Some very interesting research notes outlined in the links. Draghi seems intent on going to support the short end of the bond market with unlimited ammunition, but it will probably not be enough.
Seems like
ECB will go all-in, but it will be more like "is it already in".
Previously
on MoreLiver’s:
Roundups & Commentary
News – Between
The Hedges
Markets – Between
The Hedges
Recap – Global
Macro Trading
The Closer
– alphaville / FT
Draghi
hints at short term bond buying – Kiron
Sarkar / The Big Picture
Roundup – A
View From My Screens
Difficult
to Discern Signal in Today's Price Action – Marc
to Market
US Summary: Silver Rips, Oil
Slips, Equity Dips – ZH
Reference
Debt
crisis: live – The
Telegraph
The Euro
Crisis Blog – WSJ
FX Options
Analytics – Saxo
Bank
European
10yr Yields and Spreads – MTS indices
EUROPE
Restoring confidence
in the euro area – qfinance
The only magic wand that anyone could wave over
the current mess would be a sudden pledge from the ECB to buy as much sovereign
debt as was needed to calm markets. This wouldn't cure anything, but it would
"restore confidence", at least for a while. If it was allied to a
sudden urge by all members of the eurozone to meld together into a fiscal
union, then the magic trick would be complete. However this latter point is
right up there with "pigs might fly".
Ambassadors to tell the world EU is not falling
apart – euobserver
EUROPE: ECB
The rumor is that Mr. Draghi is going to
propose a plan to buy short sovereign debt (0-3 years) without limit if a
nation fills out the requisite form and officially asks for aid with
conditionality.
Mario Draghi Reprises Hank Paulson: Demands
Full Monetization Authority Or Else Threatens With End Of Euro – ZH
Mounting his strongest case yet for ECB bond
purchases, Draghi told lawmakers in a closed-door session at the European
Parliament in Brussels yesterday that the bank has lost control of borrowing
costs in the 17-nation monetary union.
Reasons Are Justified for ECB But Will It Be
Enough? – Bondsquawk
Goldman
Sachs’ Huw Pill lists reasons for the ECB’s buying-spree initiative.
What Happens Once Mario Draghi Unleashes The
European Creosote Bank – ZH
Eventually, however, the ECB might have to
engineer a massive “Paris Club” debt renegotiation, which is how governments forgive and
restructure debt owed by developing countries.
What’s Next for the ECB? – PIIE
This will be a critically important week for
both the ECB and the euro area as a whole, even if there won’t be many details
or explicit targets provided.
EUROPE: PIIGS
Spain’s funding costs post
a Draghi-ing –
alphaville / FT
Deutsche
Bank: Spain’s average refinancing costs would have to be lowered to 3.9% for the
remainder of the decade to offset the one-off impact of the €100bn bank
recapitalization if the latter is kept on Madrid’s books.
The One Chart To Explain Why ECB's Short-Dated
Bond Buying Program Will Fail – ZH
The market expects Spain's short-dated
cost-of-funding to more than double (to 6.5% from 3% currently) over the next
three years.
Greek tax evasion, mapped and crunched – alphaville
/ FT
Very
interesting study methodology produced a map of tax evasion intensity and which
sectors and professions are most evasion-intense.
Leaked Troika Letter Demands Greek Workweek Be
Expanded To Six Days
– ZH
USA
ISM Index
ISM
Manufacturing index decreases slightly in August to 49.6 – Calculated
Risk
US: Soft
set of data supporting the case for QE3 – Nordea
Flash
Comment: US - ISM stuck below 50 – Danske
Bank (pdf)
US ISM Manufacturing – BNY
Mellon
Recession-Type
Numbers? You Bet! – Mish’s
Third Month
of Contraction – PragCap
Manufacturing
Is Sluggish For 3rd Straight Month – The
Capital Spectator
Weaker Than
Expected – Bespoke
Weak Across
the Board – Bespoke
Biggest
Miss In Construction Spending In One Year – ZH
ASIA
OTHER
New financial forecast: On your mark, get set… – Nordea
or go
straight for the full pdf
IN FINNISH
Podcast-vinkki:
"Kuinka ratkaisisin kriisin kolmessa päivässä" – euroetana
YLE:n Politiikkaradio
tarjoilee ratkaisuja eurokriisiin jo lähes liukuhihnatuotantona. Tällä kerralla
ratkaisijana on Esko Seppänen, jolta homma hoituisi kolmessa päivässä. Ratkaisu
on aivan erilainen kuin Nallella. Se alkaisi perjantaina iltapäivällä Euroopan
keskuspankissa...