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Monday, February 15

15th Feb - ECB could accept NPLs as collateral

Previously on MoreLiver’s:
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Bloomberg Brief: Brexit SpecialBB
It simply isn’t possible to know in advance how much fear will set in to markets or how consumers and businesses in the U.K. will respond. That’s because there are no good precedents. Still, it is possible to model a stylized scenario that captures some of the potential impact. Confidence, credit provision and exchange-rate risk could all combine to deliver a nasty shock to the British economy.

A Rise of Anti-Disintegration Moods in EUeuinside

Europe's Convinced U.S. Won't Solve Its ProblemsView / BB

EU gives Greece three months to fix its borders – Politico
Will Greece Become a Refugee Bottleneck? – Spiegel
Greece & Schengen – Klaus Kastner
Italian Foreign Minister: 'The Toughest Crisis in EU History' – Spiegel
French PM says Merkel’s migration policy ‘unsustainable’ – Politico
EU Is Poised to Restrict Passport-Free Travel – NYT
Turkish-German Pact: EU Split by Merkel's Refugee Plan – Spiegel

ECB rate cut likely but no appetite for now for radical easing: policymakersReuters

Draghi's Knack for Market Turnarounds on Review as Doubt GrowsBB
ECB president to appear before European Parliament on Monday * Investors less willing to rally to negative-rate policies

Wolfgang Münchau: Four signs another eurozone financial crisis is looming – FT
The markets are saying they are losing faith in Draghi’s pledge to do ‘whatever it takes’

ECB in talks with Italy over buying bundles of bad loansReuters
ECB is in talks with the Italian government about buying bundles of bad loans as part of its asset-purchase program and accepting them as collateral from banks in return for cash, the Italian Treasury said.

Italy’s Banking Crisis Spirals Elegantly out of ControlWolf Richter
How to dump toxic waste on the public through the backdoor.

ECB’s quantitative easing programme: limits and risksBruegel
The ECB has made a series of changes to its QE programme in order to expand the universe of purchasable assets and have more flexibility in the execution of the programme. However this might not be enough to sustain QE throughout 2017. The extension of the programme also raises questions about its potential adverse consequences.

ECB's 'Whatever It Takes' May Be Too Much for German Top Court BB
ECB's OMT bond-buying program returns to German top tribunal * Case exposes German judges' struggles with EU rulings

Introductory statement by President Mario DraghiECB
Hearing at the European Parliament’s Economic and Monetary Affairs Committee

Euro-area price expectations call for ECB to act BB

The case for “global quantitative tightening” Sober Look
In January 2016, global foreign reserves (FX) continued their decline after an absolute peak in June 2014, declining significantly in distressed emerging countries and some notable oil-producing economies

Paul Krugman: What Have We Learned Since 2008?Princeton
FX: critical levelsNordea
Has risk aversion peaked yet? The USD has a good chance to recover against the EUR and the JPY then... Bad news is no news, which could be sufficient to cause some repricing.

CONJONCTURE January 2016BNP Paribas
History and major causes of US banking disintermediation * How long the Commodity Blues will play?

Eco PerspectivesBNP Paribas
Editorial : Europe’s resilience * US : Zero no more * Eurozone : Once more unto the breach! * Germany : A mild winter * France : 2016, the year unemployment finally levels * Italy : A gradual recovery * Spain : Dynamic economy, log-jammed politics * Brazil : Downfall! * Russia : Low oil prices threaten fragile stabilization * India : Public banks under scrutiny * China : The year starts off badly * Japan : Slow but steady * Ireland : Wind in its sails

Eco EmergingBNP Paribas
Editorial : Seems like dejà vu * Brazil : Downfall! * Russia : Low oil prices threaten fragile stabilization * India : Public banks under scrutiny * China : The year starts off badly * Malaysia : Rough spell * Poland : In the same boat * Romania : Fiscal stimulus * Saudi Arabia : Fiscal austerity needed but not sufficient * Colombia : Between hope and disappointment * Argentina : A long road ahead * South Africa : In ill-times * Ivory coast : Still going strong

Bank recapitalisation and economic recovery after financial crisesvox
Decisive and early recapitalisation of banks can shorten recessions by several years and help speed up recovery.

Danske DailyDanske Bank

Euro rates updateNordea

Draghi to the rescue? Yields rise as risk appetite returns, euro weakens as equities rise

Morning MarketsTF
Japanese shares soared on Monday and the Nikkei 225 closed 7.16% higher despite new data revealing a 1.4% contraction in GDP in the fourth quarter of 2015 compared to expectations of a 1.2% narrowing. Meanwhile the one ingredient missing from last week's market carnage has now returned to the fray – China.

Daily ShotTF
Bank CDS spreads are catching up with widening bank bond spreads and the price-to-book of major US banking shares has dropped to crisis-era levels which seems overdone as the US banking system is the healthiest it's been in years. The last few weeks have brought a dramatic shift in market expectations of the US Federal Reserve's policy trajectory. And in the Eurozone markets now expect rates to be cut by 23 basis points this year — deep into negative territory. In fact markets are now pricing in cuts by nine out of 10 G-10 central banks this year.

Daily Press SummaryOpen Europe

Other EU countries would not want the UK to succeed after Brexit, Hammond warns * Cameron and Merkel present united stance on EU reform ahead of crucial week * HSBC keeps HQ in London but warns Brexit could see some jobs move to Paris * New survey of British and German entrepreneurs finds strong support for UK remaining inside the EU * New poll: Six out of ten voters do not expect Cameron to get a good EU deal * French PM: We’re not in favour of permanent refugee quotas and won’t be taking more refugees * Irish PM warns voters over potential political instability, citing Portugal as an example * Pension reform continues to divide Greece and its creditors

Brussels PlaybookPolitico
Brexit week — New Cold War — Republican fight club

Global Stocks Soar On Stimulus Hopes After Miserable Chinese, Japanese Data; Short Squeeze


FX UpdateTF
The market is setting a hopeful tone to start the week as China is back from holiday and talking up its currency. ECB speakers later today are the chief interest as US markets are closed for President’s Day.

From the FloorTF
China's central bank fixed the yuan surprisingly stronger calming fears of a further devaluation and igniting a rally across Asian markets with Japanese equities soaring. Japan's Nikkei jumped more than 7% and the yen softened against the dollar as risk-off sentiment subsided.

Draghilla mahdollisuus yllättää tänään * Riskinottohalukkuus elpyi perjantaina * Kiina palasi lomilta heikoin eväin * USA:n vähittäismyynnin vahvuus yllätti myönteisesti

Maahanmuutosta tulossa kehysriihen jättiriita - hintalappu tulisi julkiMTV
Timo Haapala: Riitely maahanmuutosta iskee hallituksen sisälle nyt uutta reittiä, kehysriihen kautta.  Hallituksen edessä on rankka tappelu, pannaanko/piilotetaanko maahanmuuttokustannukset budjettikehyksiin, vai hoidetaanko asia lisävelalla - silloin maahanmuuttokustannuksille tulee myös julkinen hintalappu.

Jan Hurri: Tämän takia Deutsche Bank voi olla sinunkin painajaisesiTalSa
Analyysi Euromaiden yhteinen euro, yhteinen pankkiunioni ja nyt myös yhteiset miinuskorot varmistavat, että kaikilla eurokansalaisilla on myös yhteiset pankkipainajaiset. Yksi niistä voi olla Deutsche Bank. Jos se kaatuu, Suomi kuuluu sijaiskärsijöihin.