Last week’s
Econ & Markets here.
Previously on MoreLiver’s:
ECONOMICS
Slow Money – Big
Money – Fast Money? – Bruce Krasting
With the DOW blowing
by milestones I went looking for other things that were at record levels. The
first one that I looked at was M2. No surprise at all, M2 is bigger than ever.
Where Austerity Really Rules – mainly
macro
Many of us
rightly complain about the damage austerity politics is doing in both the UK and the US. However, in terms of simple numbers,
this is nothing compared to what is happening in the Eurozone. The table below,
based on numbers from the latest OECD Economic Outlook, may look a little
complicated, but it clearly establishes this point.
Quantitative easing does not address the fundamental
problems underpinning struggling western economies – europp
/ LSE
Quantitative
easing has been adopted by a number of central banks in the wake of the global
financial crisis. John Doukas takes an in-depth look at the effects of
quantitative easing, arguing that it not only fails to increase real economic
activity, it also increases unemployment and encourages outsourcing to
developing countries that offer higher rates of return. He concludes that
economic growth and job creation should be the priority of western governments
and not of central banks.
Fancy stimulus tools: policy vs. politics – noahpinion
Looking for a Robust Defence of Austerity – Mainly
Macro
Resources & suggested reading for readers
of The Little Book of Economics – Greg
Ip
Why fiscal problems don’t have fiscal solutions – Felix
Salmon / Reuters
Why politicians ignore economists on austerity – mainly
macro
Blogs review: The Minimum Wage debate – bruegel
In his
State of the Union Address, US President Barack Obama resurrected a pledge to
raise the minimum wage he had made during the 2008 campaign. In an effort to
fight inequality, alleviate poverty and make work more attractive President
Obama proposed proposed a $9 federal minimum wage, indexed to inflation. This
has generated a lot of writings in the blogosphere, with the main issues
revolving around the classic questions of the employment effect of the minimum
wage as well as its efficacy as a means of redistribution.
REGULATION
How Many Billions Of Drug-Laundered Money Does
It Take To Shut Down A Bank? – ZH
“If you're caught with an ounce of cocaine,
the chances are good you're going to go to jail... for the rest of your life.
But evidently, if you launder nearly a billion dollars for drug cartels and
violate our international sanctions, your company pays a fine and you go home
and sleep in your own bed at night - I think that's fundamentally wrong.”
HFT-Limiting Experiment Underway in Germany – All
About Alpha
The Germans
seem prepared to experiment with limits on high-frequency trading, as we see in
a recent Bundestag vote that leaves the particulars to BaFin. I spoke recently
to David Weild, a former vice chairman of NASDAQ, about this experiment and
about related issues.
Meet the Most Indebted Man in the World – The
Atlantic
Former
Société Générale rogue trader Jérôme Kerviel owes the bank $6.3 billion. Here's
what his case tells us about financial reform.
30 years of financial inefficiency – Triple
Crisis
The claim
that the financial sector has been ‘functionally inefficient’ was made 30 years
ago by James Tobin, and it’s great to have a quantitative basis to make this
sort of judgment.
MARKETS
Abenomics or just
your garden variety carry trade? – TradingFloor
Abenomics is simply another excuse to dive into carry
trades as the risk on/risk off market continues – this time with the JPY at the
centre of things rather than the USD. Mind the gap in JPY crosses on the next
equity sell-off.
Can Technical Analysis Boost Portfolio Returns? – CFA
Institute
P/E Ratios Creeping
Higher – Bespoke
The Dow’s new high: Rally
drivers – The
Economist
Buttonwood: Desperately
seeking yield – The
Economist
Barclays:
"Equities Surge Masks Real Fragilities" – ZH
Take The Zero-Hedge
Test – Cassandra
Does Tokyo
Who Moved Markets in
2012? – Macro
Advisers
Dow 36,000 Is Attainable Again – BB
Asset Location: The New Wealth Management
Value-Add For Optimal Portfolio Design? – Nerd’s
Eye View
Electronic trading
changed Wall Street forever – TradingFloor
In 1996, Island was
launched as the first electronic matching engine. This triggered a battle
between humans and computers from which the latter emerged victorious. The
battlefield has now moved to other parts of the industry.
Factor Analysis: Part
6–Common Problems – The
Analysis Factor
Bridgewater May Be the Hottest Hedge Fund for
Harvard Grads, but It’s Also the Weirdest – The
Daily Beast
Bridgewater
Associates is the $145 billion hedge fund elite college grads are clamoring to
work for. Daniel Gross on the oddball firm’s special sauce.