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Monday, December 1

1st Dec - PMI day

Previously on MoreLiver’s:

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The European OutlierKrugman / NYT
Being Bad EuropeansKrugman / NYT
The European imbalance problem is a German problem, caused by Germany’s persistent failure to have wage and price increases in line with what the euro requires…What we’re seeing, then, is the immensely destructive power of bad ideas. It’s not entirely Germany’s fault — Germany is a big player in Europe, but it’s only able to impose deflationary policies because so much of the European elite has bought into the same false narrative.

A European Plan for France and GermanyProject Syndicate
With European growth barely visible, and dangerously low inflation causing real interest rates to rise, the weight of public and private debt has grown very heavy, and another lost decade may be at hand. France and Germany – which largely drove European integration for more than six decades – must not resign themselves to this fate.

Germans now favor a dual mandate for the eurozone, inflation and growthThe Money Illusion
It doesn’t matter what the data show, the Germans will always find a reason to favor ever tighter money, ever more deflationary policies.

Time to scrap the Stability and Growth Pact
Today’s Eurozone fiscal discipline is the amalgamation of reforms implemented over ten years, with the latest and largest changes agreed in crisis settings. This column argues that the result fosters neither growth nor stability since actual fiscal policy has been powerfully procyclical. The focus on intermediate targets has distracted attention from the final objectives – debt sustainability and economic convergence. A drastic simplification of the current rules is proposed.

Sarkozy wins UMP leadership contestFT
Former president takes first step towards regaining Élysée

Sarkozy, the presidency and the threat from Le PenFT
Nicolas Sarkozy is back as leader of France’s centre-right UMP party. The stage is set for him to run for the presidency in 2017.

The potpourri of politics in ParisTradingFloor
Stephen Pope: President Hollande's popularity down to 12% * Marine Le Pen still carries widespread support * Sarkozy favourite to win in 2017 but must unite his party

Celebrating the Spanish recoveryFrances Coppola
The current account balance has been achieved almost entirely through a massive fall in the standard of living of Spain's population. I can't see anything to celebrate.

Podemos Calls for Debt Restructuring, Abandoning Euro the "Euro Trap" Mish’s
The Podemos party, a far-left populist party in Spain led by Pablo Iglesias, has come from out of nowhere to lead the polls.

The eastern European ‘booby trap bond’FT
John Dizard marvels at how Russia outmanoeuvred the west in Ukrainian finance

5 Countries Where Espírito Santo Is Involved In Money-Laundering ProbesWSJ
Fraud and financial irregularities aren’t the only things for which the collapsed Espirito Santo empire is under investigation. The family-controlled conglomerate faces money-laundering investigations involving at least five countries.

Italy’s budget progresses as Brussels watchesReuters

Cameron pulls back from EU brinkReuters
A month ago, the UK prime minister was close to advocating quotas on migrants from the EU…If Cameron had made such a pledge and failed to deliver it, he would have had to campaign to pull Britain out of the EU in the referendum he wants to hold by the end of 2017.

Will the ECB Start QE This Month?WSJ

ECB could fix euro zone flaw with risk-free bond: think tankReuters
As the European Central Bank comes closer to buying sovereign bonds, one London-based think tank says an opportunity has arisen to fix one of the euro zone's birth defects -- the absence of a credible "risk-free" asset.

An end to the great European bank deleveraging?FT
JPM: “Although a large part of this year’s €700bn increase likely reflects valuation effects of derivative books as we explain below, we see clear and encouraging signs that the deleveraging of the previous two years has at least stopped.”

Yes, I am OptimisticTim Duy’s Fed Watch
Perhaps, just perhaps, the US economic expansion has been consistently undersold, and continues to be undersold. It is worth considering that maybe it is time to just accept the good news without the desperate search for every dark cloud.

Sometimes I WonderTim Duy’s Fed Watch
Sometimes I think the Fed's underlying pessimism stems from some belief that inflation and wage pressures were about to occur when there was absolutely no reason to hold such a belief. The economy is only just beginning to move into a zone where more interesting things could happen.

Fed’s Dudley: Financial Market Reaction Key to Pace of Rate IncreasesWSJ

China’s Challenge on Deposit Insurance: Create Risk but Not PanicWSJ
China Drafts Bank Deposit Insurance in Move to Free RatesBB

Daily Central BanksWSJ
Hannon’s Take: Rising Joblessness Could Pressure Eurozone Leaders to Do Some Rethinking * Eurozone Sees Further Rise in Jobless, Fall in Inflation * Swiss Voters Reject Initiative on Central-Bank Gold * PBOC Readying Plan for Bank Deposit Insurance * Moody’s Downgrades Japan Sovereign Debt

Daily MacroWSJ
The narrative supporting a stronger dollar just gets more and more compelling…Coupled with the broader impact of a slowdown in Chinese demand and a weak eurozone economy, sliding commodity prices are compounding a poor economic performance in emerging markets

Danske DailyDanske Bank

Nordea MorningNordea
Black Friday weekend sales lower * Swedish finance minister has back-up plan

FI Eye-Opener: Free fallNordea
US Treasuries with a big rally on Friday. Oil prices continue in free fall. Inflation expectations continue to drop. Yields to see a temporary rebound higher today. Euro-area inflation drops only modestly – for now. German ECB member against further easing – no surprises here. Strong payrolls and ECB easing ahead? German, Spanish and French auctions on the agenda.

After Advancing, Dollar Pulls BackMarc to Market

Oil, Cartels, and the ECBMarc to Market

Germany Contracts, Japan Downgraded, Copper Tumbles, WTI Lowest Since 2009, Gold Up

Daily Shot: Oil selloff proves contagiousTradingFloor
Eurozone deflation appears to be worsening * Italian unemployment unexpectedly passes 13% * Commodities sector hits a four-year low

Even though oil price fall feels like 2008, it is not, thus consequences will be different. Liquidity is back this week, just as key events - ECB and, expectedly, blowout-payrolls...

Strategy Sweden – On the radarNordea
Norway: Oil below the critical 70$/b level * SEK rates: The switch, more curvature in the offing * Cross-market: 5s/10s decoupling * ECB: from if to when and how * Euro area: not all rates are low… * FX: PPM, an unreliable source to SEK weakness

The new oil price warBruegel
What’s at stake: Opec’s decision to leave its output ceiling of 30m barrels a day unchanged on Thursday has sent crude prices into a tailspin. Under normal conditions, falling oil prices would be a favorable macroeconomic development, but under current circumstances this is making the job harder for central bankers who struggle to deliver on their inflation targets.

IMF too timid to reprofile sovereign debts - S&PFT
S&P has said that the IMF's new debt "reprofiling" policy – currently under discussion – is unlikely to affect sovereign ratings because it reckons the IMF will be too timid to make frequent use of it.

Stress Indicators expose perversions of our monetary systemTradingFloor
As US real interest rates creep higher, our Stress Indicator charts reveal dangerous undercurrents in the world economy. Germany and France face being outclassed by their sprightlier Club Med and East European counterparts as the advantage of euro adoption ebbs. Japan, meanwhile, must contend with the culmination of its doomed policy of exporting its problems to the rest of us.

South Korea: Conditions continue to worsen in November – Markit
Japan: Conditions continue to improve – Markit
Japan growth eases, still suggests modest fourth-quarter rebound – Reuters
Japan’s Manufacturers Boost Investment Amid Weak Consumption – BB
China: Manuf. production declines for the first time since May – Markit
China: Manuf. PMI declines more than expected in November – Danske Bank
China PMI Drops To 8-Month Lows, Teeters On Brink Of Contraction – ZH
China November PMIs show economy cooling, argue for more stimulus – Reuters
China Factory Gauge Drops as Shutdowns Add to Slowdown – BB
Asia factories find demand lacking, in further blow to commodities – Reuters

Russia: PMI rises but input price inflation surges to highest since October 1998 – Markit
Netherlands: Conditions improve at strongest rate in nine months – Markit
Spain: PMI rises to highest since June 2007 – Markit
Italy: Output falls slightly as weakness in new orders continues – Markit
France: Contraction continues in November – Markit
Germany: PMI falls to 17-month low, signalling downturn – Markit
Greece: output unchanged, although weakness in new orders persists – Markit

Eurozone: manufacturing stagnates as big-three nations contract – Markit
Euro zone factory growth stalls in November as new orders sink – Reuters

UK: Solid domestic market drives growth of output and employment – Markit
UK manufacturing grows slightly faster in November despite lackluster exports – Reuters
UK Factory Growth Accelerates to Fastest in Four Months – BB
Domestic strength keeps the UK economy ticking along – Berenberg

ISM Manufacturing index at 58.7 in November – Calculated Risk
US PMI Plunges To 10-Month Lows, ISM Beats – ZH
US ISM manufacturing remains too high – Danske Bank
U.S. manufacturing cools, but underlying momentum remains – Reuters
Factories Keep Humming in U.S. Even Amid Global Slowing – BB

Global Manufacturing PMI Tumbles To 14-Month Low – ZH

EKP:ltä lisäelvytystä torstaina * Euroalueen marraskuun inflaatio laski * Ruotsin BKT kasvoi edellisestä neljänneksestä

Komission vipurahasto – älä edes yritä tätä itseJan Hurri / TalSa
EU:n taloussäännöt ja niitä vahtiva komissio eivät salli jäsenvaltioiden torjua investointilamaa julkisin investoinnein, vaikka valtioiden lainarahoitus on halvempaa kuin milloinkaan. Sen sijaan komissio haluaa itse elvyttää investointeja monimutkaisen vipurahaston avulla. Siihen jäsenvaltiotkin saavat sijoittaa alijäämä- ja velkarajoista piittaamatta.

Suomen talouden haasteet ja yritysten rahoitusolotSuomen pankki

Ruotsin entisen talousministerin raportti valmistuu hämmentämään eduskuntavaalejaHS
Esimakua kohutusta Suomi-raportista: "Suomalaisten palkkataso on liian korkea"

Populismin sijaan oikeat lääkkeet, SipiläKaj Turunen / US
"Perussuomalaisten Turusen työllisyyslääkkeet katastrofaalisia, EK:n lauluja"Verkkouutiset
Perussuomalaiset puolustaa työehtosopimusten yleissitovuutta – Verkkouutiset

Matti Virtanen: Taas on aika köyhäilynYLE

EU ja Britannia ja järki ja tunteetBrysselin kone / YLE
Miksi Britannia on alkanut suhtautua EU:hun aiempaa kriittisemmin. Jos Britannia lopulta eroaa EU:sta niin mitkä asiat siihen voivat johtaa ja mitä siitä seuraa. Haastateltavana Eurooppa-tutkimuksen verkoston johtaja Juhana Aunesluoma

"Suomi on kohta kuin Venäjä"KL
"Jos Suomi ei ryhdy tukemaan yksityistä pääomanmuodostusta, olemme pian kuin Venäjä. Siellä pääoman vienti on jo kannattavinta vientiä, sanoo Sammon, Nordean ja UPM:n hallitusten puheenjohtaja Björn Wahlroos.