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Saturday, June 7

7th Jun - W/E: Best of the Week

Here are the ”best” from my posts of the ending week. Last week’s edition here.

Previously on MoreLiver’s:

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The new European Commission: which president, and what priorities?CER

Interview with Marine Le Pen: 'I Don't Want this European Soviet Union' Spiegel
French right-wing populist Marine Le Pen discusses the European election victory by her Front National, German dominance in the EU and her admiration for Russian President Vladimir Putin.

Economic Outlook Nordics June 2014Nordea
The Nordic countries are still at various stages in the economic cycle. Norway and Sweden are well under way, while Denmark is only slowly ascending from the bottom. Finland is hit by a renewed risk of ending up in a protracted economic recession.

Breaking down the TLTROFT
A reasonable boost for the periphery then even if net additional liquidity (due to rollovers and LTRO repayments) is still an open question and worries about the efficacy of the ECB’s own Funding for Lending Scheme are likely to keep the boost minimal — AQR, capital concerns may keep banks cautious, even if they wanted to lend away there is a demand and deleveraging issue, while larger corporates have been heading to capital markets at an increasing rate anyway.

Draghi Faces Off With Regulators Over $2 Trillion Market for Tricky DebtBB
Mario Draghi is on a collision course with regulators as he seeks to revive Europe’s asset-backed debt market to boost lending to businesses.

What Mario Draghi Did Today: Goldman Sachs ExplainsZH
It is difficult to say with certainty at this stage what the net effect of these different measures will be on lending and the economy. But the ECB has clearly bought itself time before engaging in further measures. The next step will be outright purchases of ABS, for which the “preparatory work has been intensified”. There was no indication that the Governing Council was moving closer to a large-scale asset programme, even though it was not ruled out.

ECB tries to please everyone, but failsTradingFloor
The ECB tried to please everyone by deploying all of the tools at its disposal with the exception of quantitative easing. Unfortunately, the package leaves plenty of loose ends and unanswered questions.

ECB shows activism but falls short of true QEBruegel
We welcome that the ECB has finally acted with a broad package. We also think that unanimity on the package was a very positive development and sends a strong signal of unity. We expect the package to have a positive effect, however, it will take quite some time until inflation dynamics will come back to where they should be and further measure will likely be needed. A more aggressive QE (including €35bn purchases of ESM/EFSF/EIB bonds, corporate bonds and ABS) would have anchored inflation expectations more quickly as portfolio re-balancing and exchange rate channels would have operated immediately.

Lithuania and the ECB’s governing councilFT
If Lithuania’s accession goes ahead, from January, only the members of the executive board, which include ECB president Mario Draghi, will still be able to vote at each meeting. Under the new system, the number of voters will be capped at 21, meaning there will be four central bank governors at each meeting who do not vote.

Draghi has yet to banish the threat of deflationFT
The acid test will be the path for inflation in coming months…so one test of success lies with the performance of the euro in coming months… As with 1990s Japan, deflation remains a big risk partly because no one is prepared to admit it could really happen.

Rehn: Suomen tilanne on vakavaTalSa
Talouskomissaarin tehtävät pian jättävä Olli Rehn on huolissaan Suomen talouden tilasta. Hän toivoo, että myös Suomessa pankit lisäävät yritysten luototusta Euroopan keskuspankin eilisten toimien seurauksena.

Rinne: "Suomen taloustilanne ei ole erityisen hyvä"TalSa
Tänään valtiovarainministeriksi virallisesti nimitetty Antti Rinne (sd.) keskittyy noin kymmenen kuukauden kautensa aikana Suomen työllisyyden parantamiseen.

Miten keskuspankin rahoitusoperaatiot tehoavatRoger Wessman

EKP ja toimenpiteet – liian vähän ja liian myöhäänTyhmyri