12th Nov - The German ECB and China's Plans

Previously on MoreLiver’s:

KEVA / Merja Ailus / Keskusta special

Monday: Quiet start for an easy week

Weekender: Linkfest

Weekender: Weekly Support

Weekender: Best of the Week

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EUROPE

Banking union: A good idea, going nowhere – FT

 “Private” banking union in Europe is a good idea that is going nowhere. Since the euro’s creation, peripheral banks have never been so crammed with their own sovereigns’ debt – 19 per cent of assets, JPMorgan reckons – and have never held fewer non-domestic government bonds.

Iceland’s capital controls – voxeu.org

Iceland’s 2008 capital controls are still in place to prevent outflows of domestic holdings in failed cross-border banks. However, it is important for the country’s future economic prosperity to lift the capital controls without endangering financial stability. This column discusses the risks of capital controls and gives policy recommendations for cases of the three former major Icelandic banks.

Business leaders and entrepreneurs across Northern Europe add weight to EU reform agenda – Open Europe

  EUROPEAN CENTRAL BANK

Next From The ECB: Here Comes QE, According To BNP – ZH

Three Things the ECB Should Do Beyond Cutting Rates – WSJ

ECB split stokes German backlash fears – FT

Divisions at the heart of the ECB over last week’s rate cut have revived fears in Frankfurt of a German popular backlash against the bank’s policy making, even as the ECB faces decisions critical to the eurozone’s future.

Reports of the survival of the eurozone may have been greatly exaggerated – The Telegraph

Last week’s surprise interest rate cut by the European Central Bank (ECB) was largely a response to the looming danger of deflation in the eurozone

  GERMANY

In spite of currency disadvantage, Germany competes on brand – Sober Look

Germany’s Lack of Reciprocity – Krugman / NYT

Don't blame Germany for the eurozone's travails, blame the euro itself – The Telegraph

Germany didn’t set out to design an economic model that impoverishes much of the rest of Europe

UNITED STATES

Yellen Would Continue Central Bank’s Openness, Fed’s Fisher Says – WSJ

ASIA

Monitor - Chinese credit crunch – Danske Bank

China's Third Plenum Concludes Big On Promises, Hollow On Actions – ZH

Macro Viewpoint: The plan for China’s next decade – Nordea

The path for China’s next decade has been laid. From the conference communique of the third plenum, we noted a few very interesting elements that deserve some attention. Despite the attention of liberalising the economy, the Chinese state will likely maintain a tight grip of the economy.

Flash Comment China – Danske Bank

Third Plenary signals bigger role for market, but not a game changer in the short run

The Return of Japan – Project Syndicate

After several years of political instability and more than two decades of economic stagnation, Japan seems to be on the mend. But whether Japan can maintain its promising trajectory partly depends on how it addresses longstanding tensions with its neighbors.

MARKETS

Great Graphic: Sovereign Ratings of High Income Countries – Marc to Market

Where Credit is Due – NYT

Large infographic on the evolution of debt through history.

Some Interesting Charts – The Short Side of the Long

Dollar Bid on Tapering Thoughts and Disinflation in Europe – Marc to Market

Global FX Strategy: More weakness for Scandies ahead – Nordea

Summary here. Weaker NOK alongside rate cuts, SEK: It's all about weakness and the USD correction won’t last – flows support EUR. More on these stories in this edition of Global FX Strategy.

FI Viewpoint: 3% is the limit – Nordea

Summary here. In the aftermath of the strong US payrolls report, the 10Y yield is heading for 3% again, driving also EUR yields higher and leading to steeper curves. We are unlikely to go higher than 3% for now, though the risk of a short-lived bigger sell-off is real. Fed tapering is looming, although not yet in December.

Rewrite the Finance Textbook: Low Risk Offers High Return – CFA Institute

Macro Strategy Review November 2013 – The Big Picture

Macro Horizons: Policy Outlook Diverging Between Asia and Europe – WSJ

Regional Economic Outlook: Middle East and Central Asia – IMF

Financial Innovation Is Depressing – BB

Because it seems to be mostly finding legal ways to deceive people into paying too much for stuff they don’t need, or failing that finding illegal ways to do that, or failing that just firing everyone and giving up.

Assets of the Ayatollah – Reuters Investigates

Reuters investigates Setad, the $95 billion economic empire behind Iran’s Supreme Leader. Khamenei controls massive financial empire built on property seizures

FINNISH

Rahan kiertonopeuden muutos Euroalueella – Tyhmyri

Kiertonopeus on pienenevä ja pienenemistrendi on noin -2,5%

MEP-vaalien lähestyessä muistia pitää virkistää – Seppo Saari

Jari Tervo: Himanen on Tukiainen – YLE

Pääministeri Jyrki Kataisen kuuden puolueen hallitus on median mukaan epäonnistunut kaikessa, mihin se on ryhtynyt. Tämä ei pidä paikkaansa. Hallitus on onnistunut fantastisella tavalla kaikkein mahdottomimmassa. Se on saanut persut ja kepun näyttämään hyvältä.

Tutkimukseksi naamioitu hömppä leviää helposti – TalSa

Media pulppuaa uutisia kyselyistä, selvityksistä ja tutkimuksista. Ne kertovat, mitä suomalaiset ajattelevat ja miten haluavat elää ja kuluttaa rahansa. Asiantuntijat törmäävät hömppätietoon mediassa lähes päivittäin.

Ajoiko aika täysin talousoppien ohi? – TalSa

Vallitsevaa talousjärjestelmää pitäisi kyseenalaistaa yliopistoissa hanakammin sanovat brittitaloustieteilijät. Suomessa Aalto-yliopiston taloustieteen professori Pertti Haaparanta kaipaa opetukseen lisää historiaa.

Näin syntyi suomalainen peliteollisuus – HS

Suomen peliteollisuus syntyi 1980-luvulla Commodore 64 -koneiden ääressä. Sen jälkeen piti vielä jaksaa yrittää parikymmentä vuotta ennen kuin bitit alkoivat muuttua miljooniksi.

Saxon Jacobsen: Suomi ja Hollanti uhka Euroopalle – KL