The Weekender! Europe, economics, markets, regulation. Note the Berkshire weekend! (added links to this on Sunday)
Previously on MoreLiver’s:
Current Specials:
Special: ECB Watch (updated)
Special:
Reinhart & Rogoff Debacle (updated)
EUROPE
A dreary May Day, the
ECB cuts rates, and could Spain become the Florida of Europe?
A little noticed fact
about the economic turmoil in southern Europe is that Portugal and Italy, two of the countries struggling the most, had
minimal growth even during the seven good pre-crisis years of 2001–07. The most
overlooked common problem of the four Southern European countries—Portugal, Spain, Italy, and Greece—is that they are all hampered by little
education and the poor quality of the education system.
Visit could set IMF against Treasury – The
Telegraph
A delegation of senior
economists will this week arrive from the IMF to conclude its annual review of
the UK economy.
Threat to the eurozone is as strong as ever – The
Telegraph
The eurozone economy
has contracted every single quarter since the end of 2011. During the first
three months of 2013, the region's GDP shrank by a punishing 0.6pc, having
fallen at a similar pace the quarter before.
Blueprint for a deep and genuine EMU – EC
(pdf)
Conference on 7-May
(Tuesday) Debating the future economic, monetary, banking and political union
SPRING
FORECAST
Spring 2013 forecast – European Commission
The EU economy –
slowly recovering from a protracted recession
The economic winter continues – Free
exchange / The Economist
The outlook has
darkened in the northern core economies of the single-currency club as well as
in the southern periphery.
Humorists At The European Commission – Krugman
/ NYT
THE
EUROPEAN CENTRAL BANK
Other central banks
publish minutes that show how this or that official exercised the power vested
in him or her by the public. Not so the European Central Bank.
Draghi Likely To Keep Euro Weak – WSJ
Free exchange: Broken transmission – The
Economist
ECB has lost control
of interest rates in periphery
Europe’s
credit crunch: Mend the money machine – The
Economist
Small businesses’
troubles in periphery are the next step in crisis
ASIA
The Japanese Experiment – Project
Syndicate
Mohamed A. El-Erian: Weeks
into Japan's paradigm shift in economic policy, optimism
that the country may end a quarter-century of economic stagnation is balanced
by fears that the authorities' new approach may make things worse. And, while
debate naturally focuses on Japan's internal maneuvers, the tipping point may
lie abroad.
MARKETS / TRADING
Which is a Better Inflation Hedge, Gold or
Houses? – The
Big Picture
If you want to be
hedged against the risk of a pickup in inflation, you would be better off
buying houses than gold.
Weekend Sentiment Summary – Short
Side of the Long
You Don’t Really Understand the Carry Trade, Do
You? – Mark Dow
Goldman: "0% Upside For S&P 500 To
Year End" – ZH
Another Week in the Books – Bespoke
Though the number of
companies that have reported this season nearly doubled from 855 up to 1,655,
the percentage of companies that have beaten earnings estimates this season
remained the same at 59%.
128 Years of Dow Components – The
Big Picture
Want to know what has
been in the Dow Jones Industrials over the past century and change? Click thru
for an interactive chart that shows the full history of the Grandpappy all of
indexes.
Weekend Reads for Investors – CFA
Institute
The Rising Influence
of Activists, Africa, and Twitter
Filtered Market Statistics and Technical
Trading Rules – NAAIM
(pdf)
Technical analysis as behavioral finance – Humble
Student
What We're Reading ~ Hedge Fund Links – Market
Folly
Book Bits | 5.04.13 – The
Capital Spectator
Measuring the 'reach for yield' – voxeu.org
Fixed-income investors
that have targets based on imperfect risk measures are tempted to take on
additional risk to raise their portfolio yields. This column argues that when
yields are low such ‘reaching for yield’ may be especially attractive. New
research that quantifies reaching-for-yield for corporate-bond investors shows
that insurance companies, which are regulated based on broad ratings
categories, assume additional risk by selectively overweighting risker bonds
within categories. There is evidence that this distorts pricing and issuance.
BUFFETT
Live Blog: Berkshire Hathaway’s 2013 Shareholder Meeting – NYT
Live Blog: Berkshire Hathaway’s 2013 Shareholder Meeting – NYT
Live Blog: Berkshire
Hathaway’s Annual Meeting – WSJ
Berkshire
Annual Meeting: Warren Buffett’s Highlights – WSJ
Rare Interview with Charlie Munger – Market
Folly
This weekend is Berkshire Hathaway-palooza and as a part of that, CNBC
sat down with Charlie Munger for a rare interview that we wanted to highlight.
(37-minutes video)
On Questions to Buffett – Aleph blog
I’m going to comment
on three articles written before Buffett’s party. I am not picking on these because they are
dumb. I am picking on them because they
are brighter than most, but still don’t get Buffett.
Buffett maps out hopes for Berkshire without
him – Reuters
Warren Buffett on
Saturday gave the most extensive comments to date about the future of Berkshire
Hathaway Inc after he is gone, saying he still expects the conglomerate to be a
partner of choice for distressed companies.
Berkshire Hathaway's Annual Meeting 2013 – BB
ECONOMICS
FISCAL
POLICY
Lessons on Fiscal Policy Since the Recession – Economix
/ Reuters
Self-defeating austerity shocks – voxeu.org
Europe’s austerity-first approach has triggered
research-based efforts to evaluate the effectiveness of debt-reduction
strategies. This column, based on a US empirical study, suggests that an ‘austerity
shock’ in a weak economy may be self-defeating. Public-debt reduction
historically occurs gradually amid improved growth. If policymakers, firms and
households respond as in the past, we should expect lower deficits amid higher
growth and, eventually, decreasing debt ratios.
Fiscal consolidation: At what speed? – voxeu.org
Olivier Blanchard,
Daniel Leigh: The debate about fiscal consolidation reduces too often to
shouting matches about the value of fiscal multipliers, or about the existence
of a critical debt-to-GDP ratio. This does not do justice to what is a complex
choice, depending on many factors. Our purpose in this article is to review the
relevant factors at play and allow for a richer discussion.
Blanchard on Fiscal Policy – Mainly
Macro
What we need is a rule that obliges governments to switch from
consolidation to stimulus at or near the ZLB. Otherwise, the next time a
large crisis hits (and Romer plausibly suggests that could be sooner rather
than later), we will have to go through all of this stuff once again.
Playing Whack-a-Mole With Expansionary
Austerity – Krugman
/ NYT
There’s Even Bigger Problems in the Reinhart
& Rogoff Thinking…. – PragCap
MONETARY
POLICY
Where to exit to? Monetary policy
implementation after the crisis
– ECB
Speech by Benoît
Cœuré, Member of the Executive Board of the ECB, at the 15th Geneva Conference
on the World Economy: “Exit strategies: time to think about them” Geneva, 3 May 2013
Can And Should The Fed Battle
Bubbles? – EconoSpeak
Probably not very
much, even though critics have blamed expansionary monetary policy in the past
for exacerbating both the dot.com bubble of the late 1990s and the more recent
and more destructive housing bubble whose collapse (and related derivatives
markets) precipitated the Great Recession.
Richard Koo On The Ineffectiveness Of Monetary
Expansion – ZH
REGULATION
Preventing The Next Catastrophe: Where Do We
Stand? – iMFdirect
The financial sector
as a continued source of shocks. The question, then, is what to do.
IMF Conference--Financial Structure: The Issues – IMF
A New Fed Thought for ‘Too Big to Fail’ Banks:
Shrink Them – DealBook
/ NYT
Daniel K. Tarullo, a
governor at the Federal Reserve, described a measure aimed at requiring the
biggest banks to hold extra capital. Many might prefer to become smaller banks
instead.
Tarullo’s speech on capital and regulation – alphaville
/ FT
Fed governor Dan
Tarullo’s speech Friday on bank capital and regulation could well invigorate
the same amount of public discussion as Jeremy Stein’s speech on the role of
monetary policy and asset bubbles did.
The Lessons of the North
Atlantic Crisis for Economic Theory and Policy – iMFdirect
Around The Tax-Avoiding World In 53 Minutes – ZH
FINNISH
Uskoo
ken tahtoo: virallisesti Suomi hyötyy kriisistä – Jan
Hurri / TalSa
Suomen julkinen velka paisuu kaksinkertaiseksi
ja budjettitalous kyntää uutta alijäämää minkä ehtii. Vienti tökkii ja
vaihtotasekin vuotaa. Talous takkuaa ja työttömien suomalaisten määrä kasvaa
kymmenien tuhansien vuosivauhtia. Mutta väliäkös vitsauksista – virallisesti
"Suomi on hyötynyt kriisistä valtavasti".
Koska
tulee 100 000 euron seteli? – Jukka
Hankamäki
Suomen
vienti vaikuttaa myytiltä – Henri
Myllyniemi / Piksu
Draghikin
turhautuu – Henri
Myllyniemi / US Puheenvuoro