Europe, USA and China article links. ECB’s delay and
troubles in practically all the member nations seem to be the most pressing
issues in Europe, while in US the Fed’s wait-and-see and the fiscal cliff are
the main items.
Earlier on
MoreLiver’s:
EUROPE
Europe’s failure to resolve its sovereign-debt crisis will force
investment-banking chiefs in the region to consider shuttering entire
businesses rather than rely on piecemeal job reductions to revive profit.
Germany is not the only EU country where there seems to be a slight disconnect
between the main political parties and frustrated voters. But it is almost
alone in not having a plausible eurosceptic party.
From MNI, citing unnamed "senior
eurozone officials" as sources
Greek leader Antonis Samaras has said talks on
Friday with Angela Merkel marked the start of new relations between Athens and Berlin but the German chancellor
remained characteristically cautious.
Who really benefits from the weak euro? – Sober
Look
The Eurozone nations are impacted quite
differently by the fluctuations in the euro. Ireland benefits the most from the weaker euro - far more than Germany as a percentage of its GDP.
Dutch set to defy austerity as left takes poll
lead – euobserver
The left-wing Socialist party is expected to
seize the largest gains in September's Dutch elections, threatening to deprive
German Chancellor Angela Merkel of one of her closest allies in response to the
eurozone debt crisis.
The crash of the Dutch housing market reminds
us of a much older market bubble – Sober
Look
With 80% of the Netherlands' GDP coming from exports, the nation is already highly exposed to global
growth. This housing market decline could tip the Dutch economy into a
recession (also
Rabobank’s 20-page report)
EUROPE: ECB
The "revised" Eurozone chain of
events – Sober
Look
How many times have we seen this scenario play
out? The Eurozone leadership declares that it has the ultimate solution that
ends up failing at the implementation stage. This certainly feels like one of
those situations. Here is the "revised" chain of Eurozone events
In ECB-time, “the coming weeks” might be more
than 4 – alphaville
/ FT
Draghi may wait until Germany’s Constitutional
Court rules on the legality of Europe’s permanent bailout fund before unveiling
full details of his plan to buy government bonds, two central bank officials
said. D’oh! With the court set to rule on Sept. 12, investors looking for
Draghi to announce a definitive purchase program at his Sept. 6 press
conference might be disappointed,
What Today's Real ECB News Really Means – ZH
The “excuse” of the ruling on September 12 only
has any substance to the extent that (b) is true – that work on the design of
the plan is incomplete. The idea that work “is not complete” may also be a
euphemism for the fact agreement on the contours of the policy is proving
elusive.
When ECB bond-buying meets collateral – alphaville
/ FT
Chart via Nomura’s rates strategists. It’s
their version of what the plumbing of the European Central Bank’s rejigged bond
purchases should look like
Interest Rate Caps vs. Bands: Can "Secret
Sauce" Make a Difference? – Mish’s
Neither bands nor caps will work in practice.
However, if the upper range is high enough where genuine buyers would step in
on their own accord, then a cap or a band could conceivably appear to work.
USA
The Definitive QE3 Odds Calculator – ZH
UBS: The primary determinant will be
the upcoming August payroll report. The chart below ignores these other factors
and offers up the odds of further easing in September based on the base case
that Bernanke’s primary concern is the state of the US labor market. July’s
8.3% unemployment rate and payroll gain of 163k put current odds of further
easing at 45%.
The FOMC Minutes & QE3 – The Big
Picture
Why Goldman Refuses To Raise Its S&P 1250
Year End Forecast –
ZH
Political realities and last year’s precedent
suggest the potential that Congress fails to reach agreement in addressing the
‘fiscal cliff’ is greater than what most investors seem to believe based on our
client conversations.
Boomers Are Breaking the Deal – John
Mauldin / The Big Picture
The “deal” with previous older generations was
that they would retire and move on, making way for the next generation. Boomers
are breaking that deal.
CHINA
Chinese central bank’s ability to ease monetary
policy is constrained by outflow – ASA