Roundups &
Commentary
News – Between The Hedges
Markets – Between
The Hedges
Recap – Global
Macro Trading
The Closer – alphaville / FT
US: Dow Surges Despite Weak Data, European Crisis, And Military Coup – ZH
EUROPE
The religion of bribes – Linkiesta
/ Presseurop
Corruption is a key
factor in failure of the Eurozone countries facing economic difficulties. They
are for the most part, Catholic countries, a religion that has always shown a
higher tolerance for corruption than for other sins.
Euro Crisis Back? Someone Tell the Euro Traders – WSJ
PORTUGAL
The fun part of the
eurozone crisis, if there is one, is that you never know where to look. After
the Cyprus crisis three months ago, the hunt was on for
the next small peripheral country that would create a headache. Slovenia was a popular bet. So, among some hedge fund
managers, was the Netherlands, where house prices are dropping alarmingly.
There was a frisson of concern about Croatia’s accession to the EU. But it turns out that
the next country to administer a shock, two years on from its bail-out, is Portugal.
In the light of the
PGB sell-off we revisit the current crisis backstop facilities in this
Q&A
“Coalition’s hara-kiri” – Presseurop
The double resignation
of Finance Minister Vitor Gaspar and Foreign Minister Paulo Portas has
seriously weakened the government of Pedro Passos Coelho and jeopardised the
reforms negotiated with creditors, notes the Portuguese press.
Fears revive of Portuguese PSI – Euromoney
The immediate panic
over severe strains in Portugal’s coalition government in reaction to voters’
austerity fatigue is raising fears beyond a delayed restoration of market
access.
My view is that debt
relief ultimately will be required. Perhaps the near-term risk to watch is
deposit flight. Deposits, which are down
10 percent over a year earlier, have been falling in line with assets as
Portuguese banks delever. What happens
next could be the first real test of whether the precedents set in the Cyprus restructuring will cause meaningful contagion
when the risk of restructuring rises.
The forgotten man of the eurozone
returns to the headlines as Portuguese government struggles to stay afloat – Open
Europe
Portugal has only met its deficit targets due to
one-off measures while competitiveness adjustments have slowed and contingent
liabilities remain a hidden risk. With the country on the cusp of an
unsustainable debt burden any delays would likely be the final straw which
pushes Portugal into needing some form of further assistance.
UNITED STATES
Fed Ready for September Taper After Shocking
Market, Meyer Says – BB
Policy makers are
ready to start tapering bond purchases in September after Chairman Ben S.
Bernanke shocked markets by announcing a conditional timetable, said former Fed
Governor Laurence Meyer.
Payrolls Could Share Spotlight with Global
Events – WSJ
The calendar and
global events are working against investors who hoped to take positions ahead
of Friday’s June jobs report.
Data Deluge: The Good, the Bad & the Ugly – WSJ
MACRO
NUMBERS
ISM Non-Manfacturing
Index
Indicates slower
expansion in June – Calculated
Risk
Crashes To Lowest
Since February 2010, New Orders Devastated To July 2009 Levels – ZH
Slowest Growth Since
February 2010 – dshort
Hits Lowest Level
Since February 2010 – Bespoke
Service Industries
Unexpectedly Grew at Slower Pace in June – BB
Service sector growth
slows to three-year low in June: ISM – Reuters
U.S. June ISM Manufacturing Report on Business (Text) – BB
ASIA
According to our Bank
Credit Analyst service, current Japanese policies will be insufficient to
finally break deflation’s grip. The good news is that policymakers are not
without options.