Previously on MoreLiver’s:
EUROPE
MEPs vs the
budget, the euro appreciates, and Italy heads to the polls.
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.
(Sep-Oct 2012)
New European economic forecasts: The
ever-receding recovery – Free
exchange / The Economist
Paul De Grauwe and the Rehn of Terror – Krugman / NYT
Paul De Grauwe and the Rehn of Terror – Krugman / NYT
Polish leader cautious on euro entry – euobserver
Polish
leader Donald Tusk has said his country will only join the euro once it is
"100 percent ready," with 2017 said to be a target date.
Sergei
Magnitsky, a lawyer who died in a Moscow jail in 2009 after making
allegations of tax fraud against interior ministry officials, is to be tried on
tax-evasion charges in a Russian court beginning on Monday. Charles Clover, Moscow bureau chief; Geoff Dyer,
diplomatic correspondent; and Neil Buckley, east Europe editor, join Gideon Rachman to
discuss what this strange posthumous trial says about Putin’s Russia and how could it affect relations
with Europe, and particularly the US.
Paul De Grauwe and the Rehn of Terror – Krugman
/ NYT
The multiplier myth – bruegel
Applying a
naïve multiplier analysis would thus suggest that the fiscal multiplier is not
even zero but actually negative. This simple analysis suggests that different
factors may have been responsible for the actual contraction of GDP.
UK DOWNGRADE
What took you so long, Moody’s? – alphaville
/ FT
The final verdict on George Osborne as
Chancellor – mainly
macro
The Friday night drop – Buttonwood
/ The Economist
Huge Opportunity from Moody’s Downgrade of U.K. – View
/ BB
UK's George Osborne Responds To Moody's Downgrade – ZH
ECB
A central bank crisis – Coppola
Comment
I have
argued for a long time now that the problem in the Eurozone is not the
fundamentals in the individual countries, it is the design and construction of
the Euro. The Euro is a fiat currency disconnected from a sovereign - and that
is a very strange beast indeed. To a considerable extent, the European policy
makers are making things up as they go along, and therefore making considerable
mistakes.
Markets Could Start Looking for ECB Easing Now – WSJ
If this is
the point at which financial markets start expecting the Fed to tighten policy
then it should also be the point at which markets start to look for the
European Central Bank to ease, writes Nicholas Hastings.
Not such a big rush this time – Nordea
The ECB
announced 356 banks would return a total of EUR 61bn of the 3-year money they
took from the central bank in the second 3-year LTRO early last year.
PIIGS
Obsess all you’d like about President Obama’s
nomination of Mary Jo White to head the Securities and Exchange Commission. Who
heads the agency is vital, but important fights in Washington are
happening in quiet rooms, away from the media gaze.
The Sequester: Absolutely everything you could
possibly need to know, in one FAQ – Wonkblog
/ WP
ASIA
Why Tokyo
Is Unlikely to Pursue an Aggressive Foreign Policy – The election of the
hawkish Shinzo Abe as Japan's prime minister has the world worrying that Tokyo
is about to part with its pacifist strategy of the last 70 years. But Japan's new leaders are pragmatic, and so
long as the United States does not waver in its commitment to
the country's defense, they are unlikely chart a new course.
Catching up With China: Tocquevillian
Revolution, Credit Bubble Morphs and Grows, South Sea, War – HistorySquared
A brief history of the Chinese growth model – mpettis
A simple model of growth crises – Free
exchange / The Economist
It is worth
remembering, though, that one of the biggest potential threats is that the
government, worried about financial excess, will tighten policy too much, in
the process generating the economic disaster it hoped to avoid. It's very
reasonable to wring our hands over dodgy looking investment. But we should also
keep in mind that there are worse things in the world than credit-market
overheating.
In China, discussions on capital account
liberalisation have recently intensified. The Chinese government plans to
gradually liberalise certain capital account items in the areas in which there
is sufficient demand from the real economy and areas with relatively low
investment risk, while maintaining tight regulation/supervision over the other
items of the capital account and the financial sector. In response, Korean
financial institutions need to establish strategies that will enable them to
take part in this change, especially in the areas expected to undergo capital
account liberalisation in the early stage.