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Monday, August 20

20th Aug - US Close: Time for Guru

A special gift to my Finnish audience: check the VATT's 170-page giant on the Finland's depression of the early nineties. Given the amount of BS the dentally well-endowed people are pushing, it is a high time you as voters actually understood something about previous policy mistakes - and how we are again in a very similar situation. Every time they state there is no other option, they actually mean that there is no option for them. It is always about what's in it for them. I believe it is high time to start thinking about you and your future.

Previously on MoreLiver’s:

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Roundups & Commentary
Markets – Between The Hedges
The Closer – alphaville / FT

Market Commentary – A View From My Screens
The T ReportTF Market Advisors
Tyler’s US Summary – ZH
  Silver Spike Does Not Deter Zombie Market As Apple Touches The Sign Of The Beast

Reference
TV: Bloomberg, BBC
Debt crisis: live – The Telegraph
The Euro Crisis Blog – WSJ
Tracking Europe’s Debt Crisis – NYT
FX Options Analytics – Saxo Bank
European 10yr Yields and Spreads – MTS indices


EUROPE
More on latest ECB rumor
The ECB’s interest rate threshold: sovereign bond ceiling caps – Credit Writedowns
More thoughts on yield ceilings on euro zone sovereign debt – Credit Writedowns
Bundesbank Criticizes, ECB Denies Discussion "Yet" – Mish’s
Spiegel, Buba, the ECB and a rather predictable back and forth – alphaville / FT
Capping Yields a Major Threat to
GermanyMarketBeat / WSJ
Germany and ECB respond to Der Spiegel story – The Big Picture

Going for (long-run) Greek growthalphaville / FT
The recent price move means you’re now paying 50 cents for the chance of getting one euro of payout in 2015, up from 32 cents. So something is changing. Fascinating to consider how this might develop, because the warrants are like a convex bet for the eurozone crisis, offering a potential return many times higher than the short-term downside which you are being asked to hold. The upside is not short-term.

Why the Euro Will Survive: Completing the Continent’s Half-Built HouseForeign Affairs
The euro’s naysayers have it all wrong. True, the continent’s powerhouses have yet to agree on a clear plan to save the common currency, as each one is seeking to secure the best deal for itself. But they all also know that the collapse of the eurozone would be a political and economic disaster, so they will ultimately pay whatever price is necessary to keep it together.

Germany’s Unsustainable Growth: Austerity Now, Stagnation LaterForeign Affairs
Germany seems like Europe’s lone island of fiscal stability, but trouble lurks under its impressive export-fueled growth. An obsession with debt and austerity has blocked domestic investment as the country has ignored problems such as a shrinking work force and outdated infrastructure. Germany needs to borrow and spend more or face the end of its economic miracle.

How the Union Came Together and Why It’s Falling ApartForeign Affairs
After World War II, Europe began a process of peaceful political unification unprecedented there and unmatched anywhere else. But the project began to go wrong in the early 1990s, when western European leaders started moving too quickly toward a flawed monetary union. Now, as Europe faces a still-unresolved debt crisis, its drive toward unification has stalled -- and unless fear or foresight gets it going again, the union could slide toward irrelevance.

OTHER
Confidence and EnthusiasmHussman Funds
The present confidence and enthusiasm of investors about the ability of monetary policy to avoid all negative outcomes mirrors the confidence and enthusiasm that investors had in 2000 about the permanence of technology-driven productivity, and in 2007 about the durability of housing gains and leverage-driven prosperity. Market history is littered with unfounded faith in new economic eras, and hopes that “this time is different.”

Estimating Stock Market Returns to 2020 and Beyonddshort

The low paid and pensions, an impossible dilemma for governments?qfinance
One of the biggest dilemmas facing governments across the developed world is how to gracefully scale back expectations about the degree and scale of the State's promises on welfare and benefits, particularly pensions benefits. The trick for politicians is to find a way of doing this that does not immediately generate massive popular unrest.

UBS: Is that it for the re-leveraging cycle?ZH
Returns on capital are set to decline this year – the first time since before the financial crisis. RoE is being squeezed from all sides: asset turns, profit margins, and leverage.

GS: Japan’s fiscal/JGB enigma and conceptual frameworkZH
Japan’s debt/GDP ratio can only be stabilized through deep spending cuts that will necessarily include cuts in areas such as social security, and believe this will be extremely difficult to achieve politically.

GS On What's Really Happening In Markets And The EconomyBI
90-slide presentation from Goldman Sachs

Robots to Rule the World? Taking All Jobs? Replace Women?Mish’s

FX Comment: Latam Currencies in the Post-Dependency EraBNY Mellon

IN FINNISH
Suomen 90-luvun kriisin syyt ja seurakset (2001) – VATT (pdf)
Jaakko Kianderin 170-sivuinen järkäle. Koska harva tuntee edellistä rytinää. Globaali velkavetoinen kiinteistökupla puhkeaa, vientimarkkinat sakkaavat, kotitaloudet velkaisia, rahapolitiikasta on luovuttu. Koska te opitte – saatanan tunarit!

Stubb: Tulevaisuuden eurossa on "suunnilleen" yhtä monta maata kuin nyt – TE

Pääkirjoitus: Tuomioja käveli omaan miinaansa – IS

Tekeekö EKP politiikkaa keskuspankkina toimimisen sijaan? – tyhmyri

Kuvitteellinen keskustelu EKP:n edustajan kanssa – tyhmyri

Espanjan luhistuminen jatkuu – tätä ei korjata ilman EKP:n painokonetta tai omaa valuuttaa – tyhmyri

Antti Kaikkonen sanoo suoraan: ”Kreikka ulos eurosta. Nyt.” – US

Vieras velka tappaa sijoittajan Belizessä – Sami Miettinen / US Puheenvuoro
(keskustelu lopussa on pätevää)

625. H.V. Esko Aho – Jyrki Virolainen

Pörssi ja eläkerahat – Hannu Visti

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