Here are
the best article links from my ending week’s blog posts. Previous ‘Best of’ is here.
Previously on MoreLiver’s:
EUROPE
Euro area PMIs show a divided
Europe – Danske
Bank (pdf)
Special: Cameron's Speech – MoreLiver’s
Daily
Special: LTRO repayments – MoreLiver’s
Daily
CRISIS
OVER?
All pain and no (productivity)
gains – alphaville
/ FT
One of the
reasons that the eurozone’s peripherals should be willing to put up with
austerity is that it’s helping address internal balances and address falls in
competitiveness. That’s the story being sold by the politicians at least.
Great Graphic: Europe's Unit
Labor Costs and Productivity – Marc
to Market
Italy now has the highest unit labor
costs in the euro area and has seen no substantial improvement since the onset
of the crisis. France also has seen little
improvement. The labor market reforms
are pending and may change change this, but it is too early to tell. In addition, Portugal's improvement seems to have stalled
recently.
Eurozone crisis: It ain’t over yet – voxeu.org
All G7
economies are struggling in the post-crisis climate, but US GDP has recovered to pre-crisis levels,
while the Eurozone simply hasn’t. This column portrays the global crisis as a
transitory shock for the US, but as a quasi-permanent shock for
Europe. The policies that are needed get
the Eurozone back on track do not seem to be politically feasible. As tension
rises with every quarter of stagnation, prospects for the survival of the euro
are not only not improving, they are actually getting worse.
Europe's Cognitive Dissonance – ZH
Many are
arguing that all is well, crisis averted and the world can go on its merry way
to Dow 30,000. However, the reality is extremely different in the real economy
Analysis: No respite for euro
zone in long rebalancing slog – Reuters
The euro
zone crisis is entering a new, treacherous phase for governments, which can
only cross their fingers that slow-burn reforms will pay off before voters get
fed up with austerity and high unemployment.
SUMMITS
Europe and the danger of soft-pedalling – Macroscope
/ Reuters
We’ve been
here before. When the drumbeat of market pressure eases, euro zone policymakers
have tended to lose their sense of urgency.
Euro Ministers Set to Clash
Over Terms of Channeling Bank Aid – BB
European
finance ministers gathering for the first time this year begin the long march
to enacting policies they promised to subdue the debt crisis, beginning with
how to channel firewall funds directly to banks.
Euro Area Grapples With ESM
Rules as Legacy Assets Loom – BB
Ministers
seek an agreement in the first half of this year on how and when the 500
billion-euro ($668 billion) European Stability Mechanism can bypass governments
and provide direct help to banks.
PIIGS
Haven for Oligarchs: Europe's Mounting Reluctance to Bail Out Cyprus – Spiegel
There is
growing resistance in Europe to the planned aid program for Cyprus, because it would also benefit
illegal Russian money parked in bank accounts in Cyprus. The government in Nicosia is willing to make concessions, but
Brussels is demanding more reforms.
Why Cyprus Is Big Enough To Cause Trouble – ZH
UBS: The conditionality that comes with this programme does not go down
well with the current Cypriot government, whereas politicians in core eurozone
countries have started to point fingers at the small economy’s low-tax, soft
banking regulation business model. What emerges is the threat of another
deadlock
Italy: Economy Rotting While Focus on Elections – Marc
to Market
Unappreciated
by many is the fact that the Italian economy has seen the largest contraction
(7%) since the crisis began within the euro zone after Greece.
Per capita income is back, according to former ECB's Bini Smaghi, to
where it was in the mid-1990s (talk about a lost decade).
Is Grexit dead? The IMF seems
to think not. – Brussels
blog / FT
It’s Mostly Fiscal (Transfer),
all over again – alphaville
/ FT
We saw this
coming from the IMF all the way back in March 2012 — when Greece’s PSI was just over, and vague notions of
OSI were already in the air.
Spain back under the spotlight soon? – Open
Europe
Spain's public deficit for 2012 will be
somewhere around 7% of GDP - higher than the target of 6.3% of GDP agreed with the European
Commission… A day of bad news for Spanish Prime Minister Mariano Rajoy and his
government - not least because Spain had already obtained a relaxation
of its deficit target for this year.
UNITED STATES
The Legacy of Timothy Geithner – Economix / NYT
The Legacy of Timothy Geithner – Economix / NYT
Mr. Geithner came to Treasury in the middle of a
severe financial crisis, a set of problems that he helped to create and then
worked hard to prevent from worsening. As president of the Federal Reserve Bank
of New York, starting
in 2003, he watched over – and failed to defuse – the buildup of systemic risk.
Special: FED in 2007 – MoreLiver’s Daily
Koo: I’LL tell YOU when we’re delevered! – alphaville / FT
Nomura’s
Richard Koo believes the news of deleveraging’s end are premature.
ASIA
Both barrels? – Free exchange / The Economist
Japan seems to be preparing to embark on
a major effort to right its economic ship. As it does so, an interesting debate
is emerging over just what the Japanese economy needs.
Special: Bank of Japan – MoreLiver’s
Daily
China Economic Paradigm Nearing End Game – naked
capitalism
GMO, in a
compelling analysis, not only confirms the skeptics’ case but provides reasons
why the Chinese growth model faces an end game. While it may not be nigh, it
seems to be closer than most people think.
ECONOMICS
Deep Dive: Financial Repression Reconsidered – Marc
to Market
Ending 'Too Big to Fail': A Proposal for Reform
Before It's Too Late
– FED
(With
Reference to Patrick Henry, Complexity and Reality), Remarks before the
Committee for the Republic, Washington, D.C. · January
16, 2013
Have we solved 'too
big to fail'? – voxeu.org
The Subprime Crisis became the Global Crisis when one
too-big-to-fail bank was allowed to fail. This column argues that
too-big-to-fail is far from gone despite years of reform efforts. It is
important that it not be forgotten. Further analytical work, weighing the costs
and benefits of different structural reform proposals, would help keep memories
fresh and policies on the right track.
More
Ideological Excuse Making for Bad Banks – The
Big Picture
The end of 200 years of
expansion? – alphaville
/ FT
Tim Morgan
of Tullet Prebon has been threatening this tome for a while. And now it has
actually appeared…click to read…
Monetary targetry: Might Carney make a
difference? – voxeu.org
The Bank of
England’s Governor-elect has argued for a switch to a
nominal GDP target. This column points out
problems with nominal GDP targets, especially in levels. Among other
issues, nominal GDP targeting means that uncertainty surrounding future real growth rates
compounds uncertainty on future inflation rates. Thus the switch is likely to
raise uncertainty about future inflation and weaken the anchoring of inflation
expectations.
The practicalities of the
currency wars – alphaville
/ FT
Winning the
“currency wars” isn’t easy. From Citi’s Steven Englander on Tuesday
Currency Wars: Causes and
Consequences – Marc
to Market
World Economic Outlook Update – IMF
Global
growth is projected to increase during 2013, as the factors underlying soft
global activity are expected to subside. However, this upturn is projected to
be more gradual than in the October 2012 World Economic Outlook (WEO)
projections.
Special: Davos World Economic Forum – MoreLiver’s
Daily
MARKETS & TRADING
How Bucket Shops Lured the
Masses Into the Market – BB
Daily Quickie – HistorySquared
A Quick
Look at Global Real Estate Bubbles For Hints of Bank Risks
Location, Location, Location – alphaville
/ FT
The 2013
Demographia International Housing Affordability Survey – a piece of work often
quoted by bubble hunters and rubbished by the property bulls
Long-term pessimism,
short-term frothiness, and the recovery in world wealth – alphaville
/ FT
Viewed in
longer perspective the state of investor risk appetite is severely depressed –
arguably worse than at any time in the last 25-30 years.
IN FINNISH
Persuuntunut IMF
– Henri
Myllyniemi / US Puheenvuoro
Kansainvälisen valuuttarahasto IMF:n uusin Kreikkaraportti
on luettavissa täältä. Raporttia on maamme tiedotusvälineissä käsitelty perin
ylimalkaisesti.
Navigaattori – Auringonnousua Aasiassa – Nordea
(pdf)
Kiinassa ja Japanissa talousnäkymät ovat piristymässä *
BRIC-valuutat - vahvistumisen vuosi 2013 * Euriborien nousu on alkanut *
Yrityksen tulokseen kohdistuva valuuttakurssiriski
Euromaat jäävät
valuuttasodan ristituleen – Jan
Hurri / TalSa
Japanin keskuspankki BoJ ilmoitti samaan tapaan kuin
Yhdysvaltain Fed aiemmin, että se ryhtyy ostamaan kotivaltionsa velkakirjoja
määrää ennalta rajaamatta. Tarkoitus on heikentää jeniä vaikka väkisin. Fed
tekee samaa dollarille. Näin käydään valuuttasotaa – jossa euro on jäänyt
ristituleen.
Raimo Sailas: Suomi
ajelehtii EU:ssa ajopuuna – TalSa
Suomen asemasta
eurokriisin setvimisessä tulee mieleen ajopuu. Eteenpäin ajelehditaan, eikä
vaihtoehtoja ole. Näin näkee helmikuun 11. päivä eläkkeelle jäävä
valtiosihteeri Raimo Sailas. Hän ennustaa, että hallitus joutuu vielä syömään
aiempia sanojaan.