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Wednesday, November 12

12th Nov - Europe badmouthed

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Germany doesn’t understand that it has a responsibility to the rest of EuropeWaPo
German economic policy is the haunting fear that somewhere, someone may be breaking a budget rule. This Puritanism is hurting Germany's economy, and keeping Europe stuck in an even Greater Depression too.

Lew warns of European ‘lost decade’FT
The US Treasury secretary will warn Europe that it risks a “lost decade”, in an unusually blunt attack on the economic policies of America’s biggest ally.

Lew Calls on Europe to Do More to Avert ‘Lost Decade’BB
U.S. Treasury Secretary Jacob J. Lew called on Europe to do more to avert a lost decade of growth, saying central bank easing alone isn’t enough.

How can Europe avoid secular stagnation?Bruegel
Demand shortage, unit labor cost divergence and substantial debt overhang

The spectre of deflation hangs over Europe – and we should all be scared George Magnus
Political spectres have haunted Europe for a long time. For Karl Marx, it was communism, for Churchill fascism, and for the baby boomer generation the Soviet ‘menace’. Now we also have an economic spectre in the form of deflation. It may scare people like inflation did in the 1970s, but we should fear it for good reasons.

The case of the disappearing Fiscal CompactCEPS
Following the Commission’s autumn forecast showing that only five euro-area countries exhibit a fiscal balance better than the 0.5% of GDP deficit allowed by the Fiscal Compact, Daniel Gros and Cinzia Alcidi attempt to explain in this new Commentary why there is precious little policy debate over these flagrant treaty violations. They find that it is not possible to put fiscal policy in a legal straightjacket and that the tight rules enshrined in the new Treaty and in national constitutions are discarded as soon as they become politically inconvenient.

Juncker Fends Off Tax Critics, Seeks Disclosure of BreaksBB
European Commission President Jean-Claude Juncker sought to blunt an early challenge to his leadership by rebutting allegations that he presided over sweetheart corporate tax deals during almost 19 years as prime minister of Luxembourg.

Ponytailed Professor’s Ascent in Spain Dimmed by ECB BetsBB
Name a Mediterranean euro member with an upstart political group that’s anti-austerity, pro-debt renegotiation and ahead in polls. Greece? Yes. And now Spain.

Opinion polling leaves little doubt Podemos could break into the mainstream of Spanish politics at next year’s general electionEuropp / LSE

The UK inflation report: four things to watch – FT
A Bank of England dovecote? – Reuters
Live blog: Bank of England quarterly inflation report – FT
Inflation Report – BOE
Bank of England sees inflation below one pct, slower rate rises – Reuters
GBP kneejerks lower on BoE Inflation Report release – TradingFloor
Why no loosening, if conditions mean a greater, below-target deviation? – Long and Variable
Carney leads analysts to water, but can’t make all of them think – Reuters

Survey: access to finance of enterprises in the euro area Apr-Sep 2014ECB

Dear ECB...get your act together on bond buyingTradingFloor
You could argue that with the structure of Eurozone sovereign yields already so low that the game of yield limbo has almost run its course. In which case, it's tempting to ask what good will sovereign bond buying by the ECB do? However, with the risk of “lowflation” or even deflation omnipresent, it is surely worth trying. But getting the ECB to agree on anything is another matter.

Industrial production up by 0.6% in both euro area and EU28 – Eurostat
Euro zone industry output rises slightly in September – Reuters
U.K. Unemployment Remains at 6% as Wage Growth Accelerates – BB
UK wages rise more than expected, unemployment rate stays unchanged – Reuters

BOJ's Miyao: chance high that QE exit debate can begin in second half of FY 2015Reuters
BoJ board member Ryuzo Miyao said on Wednesday there is a high chance that the central bank can begin debating an exit to its quantitative easing in the second half of fiscal 2015, the most specific comments to date about when that debate will start.

BOJ’s Sato Sees Inflation Expectations RisingWSJ

Daily Central BanksWSJ
Hilsenrath’s Take: Troubling Signs of Deflation in China * Bank of England Signals Later Than Expected Rate Rise * Plosser: Raise Rates Soon Or Risk Falling Behind The Curve * ECB’s Balance-Sheet Goal Takes a Hit * BOJ Board Member Calls for Government Progress on Reforms

Daily MacroWSJ
The Asia-Pacific Economic Cooperation summit concluded with a surprising amount of deal-making on the part of China.

Danske DailyDanske Bank

FI Eye-Opener: Still breaking recordsNordea
German yields edge lower in quiet trading. Yields with more downside left. Intra-Euro-area spreads narrow. Japanese equities hit 6-year highs on hopes sales tax hike will be delayed. BoE inflation report and Draghi’s speech ahead. New German 2-year benchmark and more.

Consolidative Tone Persists, Dollar MixedMarc to Market

Suomen pankeista tiedetään liian vähänTalSa
Johannes Niemeläinen: Suomen Pankki on kuluvan syksyn aikana käsitellyt tutkimuksissaan yritysrahoituksen tarjontaan vaikuttavia seikkoja. Vielä vertailukelpoista tietoa Suomen pankkisektorista on kuitenkin vähän.

Kreikan velat jäävät lainoittajilleYLE
Kreikan velkojen jonkinlainen saneeraus siivottiin keväältä eurovaalien ja komission kokoamisen alta, mutta nyt velkavaltio on jälleen kokouspöydillä.

Kansalainen ErkkoKemppinen

Wahlroos vs. Vartiainen ym.Roger Wessman