Another strong day in the markets. My original idea for the week was to have minor strength first, followed by a sell-off. I am not changing my view from that, so if not short, at least try to get long at lower prices. If you look carefully enough, the EURUSD and S&P seem to "occasionally correlate" - and the EURUSD is also sitting below resistance levels. Meanwhile, Spanish 10y bond is back to recent highs, so all the risk markets are basically up against major resistances. Rest of the week negative, is my guess.
Couple of interesting articles: I didn't know that Bundesbank did QE in 1975. Makes its opposition today even weirder. Or actually it proves my hunch, that the Germans are really not interested in sound monetary policy for Europe - they are interested in sound monetary policy for Germany. And that's why this "thing of ours" will fail.
Previously
on MoreLiver’s:
Exit Special (collection of euro breakup/exit
research)
Special: ECB WATCH (follows the latest ”plan”)
News – Between
The Hedges
Markets – Between
The Hedges
Recal – Global
Macro Trading
The Closer
– alphaville / FT
Market
Commentary – A
View From My Screens
Tyler’s European Summary – ZH
Italy And Spain 'Steady' At
Pre-Draghi Sell-Off Levels As Front-End Softens
Tyler’s European Summary II – ZH
European
Stocks End Green; Sovereigns And Credit Not So Much
Tyler’s US Summary – ZH
Oil And
Treasuries Lead Stocks Higher As Credit Lags And Volume Remains Flaccid
Debt crisis:
live – The
Telegraph
The Euro
Crisis Blog – WSJ
FX Options
Analytics – Saxo
Bank
European
10yr Yields and Spreads – MTS indices
EUROPE
Ironisch Bundesbank lessons – alphaville
/ FT
In 1975 the
German central bank was buying government bonds because of low growth. So why
does the Bundesbank oppose it now?
Segmentation of the Euro interbank market is
significant
To what degree is the ECB flying blind? – alphaville
/ FT
Effective monitoring means having good data.
The data the European Central Bank currently have is arguably not enough for
even the macro-prudential supervision they’d like to do, let alone the more
specific kind — a troubling thought if it is to build out a regulatory
capacity.
Eurogeddon: The first two and a half years of
the euro crisis – Thomson
Reuters
A new e-book from Reuters Breakingviews edited
by Hugo Dixon. Find out which countries were fit for the single monetary policy, if
it might be better to abandon the single currency, whether the euro zone can
solve its troubles.
Also full
pdf
OTHER
How Long for Low Rates? – Project
Syndicate
Kenneth
Rogoff: Ultra-low interest rates may
persist for some time. Certainly Japan’s rates have remained
stable at an extraordinarily low level for a considerable period, at times
falling further even as it seemed that they could only rise. But today’s low
interest-rate dynamic is not an entirely stable one. It could unwind remarkably
quickly.
Political economics: The Fed on the ballot – Free
exchange / The Economist
To avoid allegations of bias or politicisation,
the Fed should stay its hand. Mr Romney, however, has now associated himself
with inaction, such that a failure to intervene is now "doing what Romney
advocates". This now makes intervention the apolitical default. And
therefore more likely.
What is Driving Investors? Hint: Many Things – The
Big Picture
Lots of folks are wondering where the retail
investor has gone. There is some instructive “thinking out loud” as to what is
going on: Why there is such light volume, why has financial television ratings
plummeted, why has America fallen out of love with equities.