13th Nov - Deflation and the ECB

Previously on MoreLiver’s:

Tuesday: The German ECB and China's Plans

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

European Council: The EU’s secret summitry – Presseurop

A lack of openness in Brussels negotiations is often cited as a cause of the EU’s democratic deficit. But for the “Brussels' ultimate insider”, historian Peter Ludlow, behind-closed-doors meetings are a cornerstone of EU leaders’ decision-making.

Europe Looks Better, So It Must Be Time to Sell the Euro – WSJ

That’s the message one Citibank analyst is taking from the passing of a key milestone in the comparative value of euro-zone and U.S. debt.

European Rally Not Over Yet: BofA Merrill – WSJ

Le Pen, Wilders eye eurosceptic alliance for EU elections – Reuters

Eurosceptics Geert Wilders of the Netherlands and Marine Le Pen of France will discuss closer cooperation on Wednesday in a bid to capitalise on voter frustration with mainstream politics before 2014 European parliament elections.

The last thing highly-indebted Britain wants is price deflation – The Telegraph

Some European countries are already in technical price deflation, which makes the “good news” on British prices seem somewhat underwhelming

Governments must follow the ECB's rate cut with policy action – Bruegel

Besides bank restructuring in the periphery in particular, the right conditions for more growth in Germany and France need to be put in place.

Nationalism makes for bad economics, ECB edition – WaPo

But if the experiment of a united Europe is to succeed, the central bankers will have to act with the unity that they have pledged. These divisions, if they persist and widen, could come at a cost of dysfunction in the one European institution that has stood tall against the challenge of holding a disparate continent together.

Four Takeaways From Interview With ECB’s Praet – WSJ

 

  GERMANY

Brussels looks warily at German surplus – MacroScope / Reuters

Barring a last minute change of heart, the European Commission will launch an investigation into whether Germany’s giant trade surplus is fuelling economic imbalances, a charge laid squarely by the U.S. Treasury but vehemently rejected by Berlin.

One Year Later, Has the German Bubble Grown? – CFA Institute

A look at the risks that have been building in advance of the Deutsche Bundesbank’s warning about property bubbles, and what they mean for the eurozone.

Europe Follows US In Demanding Germany Explain Its Exporting Ways – ZH

Germany Blasts Back At Barroso's Bureaucratic Blathering – ZH

  UNITED KINGDOM

BOE’s Carney Finally Says ‘Rates Could Rise Sooner’ – WSJ

BOE’s New Guidance: Investors and Economists React – WSJ

BoE more upbeat on economy but in no rush on rates – Reuters

BOE Struggles With Forward Guidance – WSJ

  EUROPEAN CENTRAL BANK

Should we be worried about deflation if the ECB is? – TradingFloor

Analysis: Deflation threat in Europe may prompt investment rethink – Reuters

The threat of deflation in the euro zone could reverse a major investment trend of 2013, drawing funds out of stocks and into government bonds and cash.

ECB briefs heads of top euro zone banks ahead of stress tests – Reuters

Bosses from top euro zone banks were gathering at the ECB on Wednesday to find out what it will be looking for in its upcoming "stress tests" on their balance sheets.

EU banks outside euro zone likely to overcome stress test divide – Reuters

EU nations that lie outside the euro zone plan largely to fall in behind the European Central Bank when they check the health of their banks, helping them to avoid a "two tier" outcome in stress tests next year.

Factbox: Non-euro zone bank stress tests preparations by country – Reuters

Many of the 11 EU nations that lie outside the euro zone plan to align tests of the health of their banks closely with a European Central Bank assessment of major lenders within the currency bloc.

Plan to raid bank creditors could shatter calm – Reuters

Market euphoria and soaring demand for European bank debt could be brought back down to earth if the European Union pushes ahead with the early introduction of rules allowing Cyprus-style raids on bank creditors and big depositors.

Euro Tumbles After ECB Hints At QE – ZH

Germany’s Weidmann Defends ECB Against Charges It’s Hurting Savers – WSJ

  MACRO NUMBERS

Euro area industrial production points to modest Q3 GDP growth – TradingFloor

UNITED STATES

Fed’s Kocherlakota: Expectations of Fed Taper Are ‘Puzzling’ – WSJ

Why Has Nobody Gone To Jail For The Financial Crisis? Judge Rakoff Says: "Blame The Government" – ZH

ASIA

  CHINA’S PLENARY

China Plenary Ends, Significance Yet to Be Determined – Marc to Market

The initial official coverage seemed to emphasize the upgrading of market forces.

Hedging bets – FT

China's ruling Communist Party has pledged at its Third Plenum to give the market a “decisive” role by 2020, but its commitment to the state’s pre-eminence is unchanged.

Third Plenum: The Analysts’ Take – WSJ

The morning after the plenum before… - alphaville / FT

How to make “comprehensively, deepening reform” in China – The A-list / FT

Was the outcome of the Third Plenum “unprecedented”, as one member of the standing committee expressed beforehand? Or at least “comprehensively deepening reforms”, as characterised officially?

Understanding Japan’s GDP: A Guide for the Perplexed – WSJ

Japan on Thursday will release preliminary data for the third quarter’s gross domestic product, which will serve as a progress report on Prime Minister Shinzo Abe's economic policies and provide a key input into discussions of next year's budget.

OTHER

Central Banks Risk Asset Bubbles in Battle With Deflation Danger – BB

Central banks are finding it’s easier to push up stock and home prices than it is to prevent inflation from falling short of their targets.

Inflation is Dead? Not Everywhere – WSJ

Until the richer countries can spur enough domestic spending to generate jobs and find buyers for the surfeit of goods now produced by their lower-income counterparts, the price of both those goods and of labor will stay depressed in the developed world.

FINNISH

Navigaattori – Nordea

Deflaatiosta Euroopan kriisimaiden uusi uhka * Pitkät korot nousu-uralla * Asuntomarkkinoiden ahdinko painaa Norjan kruunua * Option suojauskustannus vain osa preemiosta

Tässä kisassa euro jää helposti jumboksi – Jan Hurri / TalSa

Keskuspankit käyvät kisaa siitä, kenen valuutta heikkenee eniten. Kaikki haluavat heikon valuutan, jotta talous lähtisi kasvuun muita nopeampi. Kaikki eivät voi tätä kisaa voittaa eikä yksi voi kuin hävitä. Euron rakenne ja säännöt tarkoittavat, että se ei voi olla valuuttojen suurin pudottaja.

Kiinnostaako ketään totuus alkoholin matkustajatuomisista? – Soininvaara

Suomiko seuraava kriisimaa? ”Mennyt ei ole tae tulevasta” – Uusi Suomi

Brysselin kone: Enemmän federalisaatiota Euroopan unioniin – YLE

Miksi EU:ta kannattaisi muutta aiempaa federalistisemmaksi.Haastateltavana on Eurooppafederalistien vt. puheenjohtaja Saku Lehtinen ja toimittajana Maija Elonheimo.

Onko Suomen leijona luovuttanut? – Risto Pennanen / TalSa

Suomen leijona kuulostaa tappioon alistuneelta hetkellä, jolloin kaivattaisiin jälleenrakentamista.

Saksan toimet syyniin – Henri Myllyniemi / US Puheenvuoro

Mikään ei koskaan muutu – Juhani Huopainen / US Puheenvuoro

Maan hallitukselta oikea päätös: Veropäätökset luovat pohjaa kasvulle – EK

Orpo: Suomen suurin yritysveroremontti sitten 90-luvun – Verkkouutiset

Suomelta tiukat reunaehdot kriisipankkien pelastamiselle – Verkkouutiset

EU:n komissio ruotii Suomen taloutta tarkemmin – YLE

Suomen kilpailukyvyn nopea lasku huolestuttaa komissiota. 16 maata mukana.