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Wednesday, August 6

6th Aug - ECB ahead, macro worsens



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EUROPE
The ECB must move to counteract market turbulences – FT

Draghi, Juncker hold 'constructive talks' on European economy – Reuters


Market is betting against Draghi’s efforts to fight deflation – Marketwatch



  UKRAINE / RUSSIA
Ukraine crisis update – Danske Bank
U.S. Exports to Russia Plummet 34% Amid Escalating Sanctions Battle – WSJ
Europe Is Highly Dependent On Russian Gas – The Big Picture

  BANCO SANTO ESPIRITO
Europe's bank rules fall at first hurdle: Ambrose Evans-Pritchard – TradingFloor
The rescue of Portugal's Banco Santo Espirito to the tune of EUR 4.9 billion effectively signals a fall at the first hurdle for the EU's tough rules on bank failures. Ambrose Evans-Pritchard warns that the subsequent impact on taxpayers undermines every pledge made by European officials last year and is potentially incendiary in a country where austerity fatigue is rife.

Fact: Banco Espirito Santo gets a 4 billion euro recap – Bruegel
The plan will also include a bail-in of junior debtholders and shareholders as well as a restructuring of the bank, which will be split in two. BES is a test case for the new European approach to the management of banking crises and will be an important case study for policy makers.

  MACRO NUMBERS
U.K. House Prices Rise at Fastest Pace Since 2006 – BB
U.K. Industrial Production Increases Less Than Forecast – BB
UK economic growth slows in May-July: NIESR – Reuters

The Italian Conundrum – WSJ
Italy’s Second-Quarter GDP Declines, Showing Recession – BB
Italy's economy returns to recession – Reuters
Italian economy unexpectedly contracts in Q2 – TradingFloor

German orders fall at their sharpest rate in almost three years in June – Reuters

UNITED STATES
Great Graphic: US Corporate Taxes, Inversions and Surplus Savings – Marc to Market

  MACRO NUMBERS
June Trade Deficit Smaller Than Expected, Ex-Petroleum Deficit Near Record – ZH
Trade Deficit decreased in June to $41.5 Billion – Calculated Risk
Trade Gap Shrinks to Five-Month Low as U.S. Imports Drop – BB
U.S. trade deficit narrows as petroleum imports fall - Reuters
U.S. Home Prices Slowed Down in June – Calculated Risk

OTHER
Daily Central Banks – WSJ
Douglas’ Take: BOE’s MPC Nearing Division on Rate Path * Fed, FDIC Rebuke Bankruptcy Plans of 11 of Nation’s Biggest Banks * Fed’s Fisher: FOMC Moving Toward Hawkish Stance * RBI’s Rajan Sees Risk of Financial Markets Crash * Economists Prove The Success of ECB’s OMT

Daily Macro – WSJ
It’s as if markets can finally see the elephant in the room. Actually, there are three elephants, and it’s now impossible to ignore them… no matter how benign the data, we have crossed a threshold of economic recovery where the Fed is going to have to, sooner or later, signal that it’s preparing to raise rates in the New Year… the more China finds ways to disguise or artificially postpone the slowdown that its economy must undergo while it shifts from over-leveraged investment-led growth to consumer-led growth, the more painful the eventual correction is going to be… geopolitical risk: Israel, Iraq and the big one, Ukraine

Should central bankers embrace the cult of the offensive? – FT
A new article by Andrew Haldane, the Bank of England’s chief economist, is a useful reminder that the debate over how (or whether) central bankers should respond to excessive risk-taking continues to heat up as the pain of the recession gradually recedes in the US and UK.

Incredible Shrinking Yields – Bespoke
Remember a few years back when everyone used to look at the 1% yields on long-term Japanese sovereign debt and write it off as a phenomenon specific to Japan?

Dollar Flash Crashes – ZH
Appears led by major JPY buying as someone just puked a huge carry trade

FINNISH
Espanjan pankkien ongelmalainat vähenemässä – mutta mitä muhii pinnan alla – Tyhmyri

  2015 BUDJETTIEHDOTUS
Rinne: "Painopiste kotimarkkinoiden kasvuun" – YLE
Valtion velka nousee sataan miljardiin – IS
Valtion velka nousee sataan miljardiin – IL
Rinne: Venäjän-tilanteen takia ei vielä lisää velkaa – TalSa
Kesk. Tiilikainen kritisoi Stubbin ja Rinteen ristiriitaisia lausuntoja – Verkkouutiset
Slunga-Poutsalo: Suomi vakaasti Kreikan tiellä – PS

Stubb: Suomi ei voi irtautua Venäjä-pakotteista – TalSa

Pakotteet painavat Suomen syvemmälle suohon – TalSa
Jan Hurri: Analyysi EU:n ja Yhdysvaltain määräämät talouspakotteet tuskin vaikuttavat Venäjään niin kuin on tarkoitus. Ennemmin ne yllyttävät Venäjää koventamaan kuin pehmentämään otteitaan Ukrainassa. Sen sijaan pakotteista koituu vakavaa vahinkoa taloudelle – ensin Venäjällä ja heti perään Suomessa.

Telakkaratkaisussa järki voitti tunteet – TalSa
Risto Pennanen: Valtio on noussut Suomen merkittävimmäksi riskinottajaksi, vaikka monet eturivin poliitikot olisivat toisin halunneet.

Kreikkalaiset euroalueen köyhimpiä, yli kolmannes köyhyysrajan alapuolella – Verkkouutiset