Previously
on MoreLiver’s:
W/E: Weekly Support (updated!)
EUROPE
Europhoria once again – Bruegel
Should we view the recent fall in spreads and yields as a sign of
confidence or as another overreaction?
Having a low share of a global earnings index is not, perhaps, the end
of the world – and can, in part, be explained not just by there being no
Apple-sized behemoths in Europe but by a lack of big
IPOs. But what is more worrying, as the European earnings season picks up
steam, is what fourth-quarter corporate results show about the anaemic regional
recovery. SocGen also points out that profit margins at Europe’s non-financial
companies are only slightly higher than in 2009.
FREE MOVEMENT
Swiss vote to set
limits on immigration from EU – The
Telegraph, European
Voice, Reuters
The threat to its survival may have passed but the euro zone faces
electoral and economic crosswinds this year which could push it to break policy
taboos while challenging its ability to do so.
BANKING
EU Banks’ Debt
Addiction Threatens ECB-Led Overhaul – BB
When Europe’s leaders set out in June 2012 to break the
“vicious circle” between banks and sovereigns, they left rules for treating
government bonds untouched, an oversight that may subvert their drive to
prevent a recurrence of the debt crisis.
Danièle Nouy - Interview
with Financial Times – ECB
Chair of the Supervisory Board of the Single Supervisory Mechanism, 10 Feb 2014
GERMAN CONSTITUTIONAL COURT
Outright Monetary
Infractions – Project
Syndicate
Hans-Werner Sinn: The German Constitutional Court has delivered its
long-awaited decision on the ECB’s “outright monetary transactions” program.
The Court has now declared that it fully endorses the plaintiffs’ arguments,
and that the ECB's scheme to purchase potentially unlimited volumes of eurozone
governments' bonds does indeed violate EU law.
Wolfgang Münchau: The
OMT is a phantom programme. It was never triggered. Then again, it may have
already served its purpose: fooling investors into believing there is a
backstop when there is not…So what would happen if the ECB wanted to trigger
the scheme? Following this ruling, I am not sure the Bundesbank could
participate.
Whether or not the OMT ever becomes anything more than a vague promise
doesn’t matter because it’s already achieved its purpose–to save the euro
during a time when it was under existential attack.
OMT focuses on financial stability; avoiding deflation is no less
important. Bigger, bolder forms of quantitative easing may soon be necessary to
ward off this danger. One way or another, this tool must be made available.
What signal was Germany's constitutional
court really sending about the ECB program that many credit with saving the
euro?
The German
Establishment—Principled but Pragmatic – PIIE
Germany's Constitutional
Court ruling last Friday marks a significant escalation
in efforts to rein in the European Central Bank. The ruling's message? Either
the European Court of Justice has to stop bond purchases or German justices
will.
CRISIS COUNTRIES
Italian banks, which have raised money, sold assets and cut costs to
boost capital, may face a shortfall of as much as 15 billion euros ($20
billion) as regulators scrutinize their balance sheets this year.
There are compelling political arguments for the West to respond with a
financing program that makes it economically viable for Ukraine to choose the
EU Association Agreement that it rejected last year. But the economics make a deal hard to put
together. For now, the ball is in Ukraine’s court
Hungary’s central
bank: playing with fire – beyondbrics
/ FT
UNITED STATES
Debt Ceiling Update – Marc to
Market
FEDERAL RESERVE
Fed’s Rosengren Urges
Patience in Pulling Back on Easy Money – WSJ
Grand Central: How to
Watch Yellen’s Testimony – WSJ
Hilsenrath’s take on testimony, plus key developments around the world
As Yellen makes Fed
debut, expect theater, not fireworks – Reuters
Yellen's first test as chair of the Federal Reserve comes on Tuesday
when she faces U.S. lawmakers, some hostile to the central bank, who will want
to know how committed she is to winding down the Fed's support for the economy.
EMERGING
Flows Don’t Follow
Value, They Follow Performance – The
Reformed Broker
Emerging Markets:
Here Come the Bulls – The
Reformed Broker
In its quarterly monetary policy report released on Saturday, the People's
Bank of China signalled
that volatility in money-market interest rates will persist and borrowing
costs will rise
Traders Crying Over
Losses Missing HSBC’s Bargains – BB
HSBC, which gets more than half of its revenue from emerging markets,
says it’s time to start buying their currencies after a sell-off pushed
exchange rates to their lowest levels since 2009.
JP Morgan: EM credit
growth presents risk of “systemic global financial markets shock” – beyondbrics
/ FT
OTHER
Yellen, Carney Face
Explaining Policy as Benchmarks Near – BB
Barclays' Busted For
Stealing, Selling Confidential Financial Data Of Thousands Of Clients – ZH
Long-Term Charts 3:
Markets Since The Dawn Of Civilization – ZH
FINNISH
Stressitestien sivulliset uhrit – Nordea
Pankkien
tasesyynin sivuvaikutukset jarruttavat euroalueen talouskasvua. Vaikka EKP:n
pääjohtaja Mario Draghi antoi ymmärtää, että käänne luotonannossa voisi olla
käsillä, suurta hyppäystä ei kannata nopeasti odottaa.
Sosioekonomiset erot: työurat, eläkkeelle
siirtyminen ja eläkejärjestelmä – Eläketurvakeskus
Duunareista jaksaa eläkeikään vain 39
prosenttia – KL
Ylemmistä toimihenkilöistä vanhuuseläkeiän
saavuttaa ansiotyössä 69 prosenttia. Tämä selviää Eläketurvakeskuksen tuoreesta
raportista ”Sosioekonomiset erot – työurat, eläkkeelle siirtyminen ja
eläkejärjestelmä”
Näkökulma: Kumpi Suomea johtaa – IL
Ottaako
tasavallan presidentti Sauli Niinistö itselleen liiaksi talouspoliittista
valtaa, kirjoittaa Juha Keskinen.
Teollisuustuotanto
väheni jouluk.5,2% YoY – Tilastokeskus
Teollisuuden
uudet tilaukset vähenivät jouluk. 6,2% YoY – Tilastokeskus