Previously
on MoreLiver’s:
EUROPE
The European
Commission: Lagarde for president – The
Economist
If ever Europe needed a competent reformer with new ideas, now is the
time
GERMAN CONSTITUTIONAL COURT
German court parks
tank on ECB lawn, kills OMT bond rescue – The
Telegraph
German High Court
Blows Up Euro, Says ‘Oh Wait,’ Abdicates – Testosterone
Pit
How Germany Just
Undercut the Euro – Megan
Greene
Why Germany Is No Fan
of ‘Whatever It Takes’ – WSJ
Courts and
contradictions: Karlsruhe speaks out – The
World / FT
Who is exceeding
their powers? – The
Economist
The German court’s
futile search for Platonic essences of ‘monetaryness’ and ‘fiscalness’ – Long
and Variable
BANKING UNION
Europe’s Ungainly
Banking Revolution – Project
Syndicate
Daniel Gros: Late last year, eurozone finance ministers reached a
compromise on the basic elements of the SRM – that is, how to deal with banks
in difficulty. The deal looks ugly, but it also appears likely to work.
ECB launches public consultation
on draft ECB SSM Framework Regulation – ECB
ECB Spells Out New
Supervisory Powers in Draft Paper – WSJ
The ECB will become the ultimate authority for issuing and revoking bank
licenses in countries that sign up to the European Union's banking union
project, and assume the power to set higher capital requirements than those
applied at national level
UNITED STATES
Consumer credit and
deleveraging – Sober
Look
A very different picture emerges - one of significant consumer
deleveraging that is only now beginning to stabilize.
FEDERAL RESERVE
U.S. jobless rate forces Yellen's hand on Fed
guidance – Reuters
It was more than a
year ago that the U.S. central bank first promised not to raise interest rates
until joblessness fell to at least 6.5 percent, a pledge that policymakers
thought would hold until at least mid-2015.
Why monetary policy
should ignore bubbles – Quartz
DEBT CEILING / FISCAL
CBO: Federal Deficit
at $10 Billion in January – Calculated
Risk
We hit the debt
ceiling today. These charts show when we could default. – WaPo
The Debt Ceiling
"X-Date" Is Back: May Hit As Soon As February 28 – ZH
Secretary Lew Sends Debt Limit Letter To
Congress – US
Treasury
EMERGING
QE
Tapering: Impact Differs Amongst Emerging Markets – Moody’s
The
‘desperate duo’: currency stability – for now – beyondbrics
/ FT
Argentina,
and Ukraine: very
different circumstances, but both countries are jumping at desperate measures
to keep their currencies afloat. But meddling in the FX market doesn’t always
work.
China Spurs Market
Rout Blamed on Fed, Goldman Sachs AM Says – BB
China’s policy shifts are a bigger driver of the selloff in emerging
markets than the Federal Reserve’s decision to dial back stimulus, according to
Goldman Sachs Asset Management.
Troubled Times:
Developing Economies Hit a BRICS Wall – Spiegel
Until recently, investors viewed China, Brazil and India as a sure
thing. Lately, though, their economies have shown signs of weakness and money
has begun flowing back to the West. Worries are mounting the BRICS dream is
fading.
Emerging economies
are out – Nordea
Recent years provide a good illustration of how sentiment in financial
markets can change. About seven years ago the BRIC countries (Brazil, Russia,
India and China), eventually followed by South Africa (BRICS), were seen as
rising stars in the economic firmament. Now BRICS as a concept is hardly
mentioned anymore, and the emerging economies suffer from capital outflows.
Some of this is blamed on the Fed’s decision to taper its bond-buying
programme, but that is probably just part of the reason.
What Might Ignite
Global Contagion? – WSJ
The current sell-off in emerging markets and darkening investor mood in
advanced economies hasn’t turned into a global cascade of financial contagion. But
what could trigger widespread selling that routs the long hoped-for global
recovery?
Foreign Exchange
Controls Lift Ukraine's Currency – WSJ
Central Bank Limits Individuals Purchases of Hryvnia, Waiting Period for
Companies
Watching the 'China
taper'
– Sober Look
While the rate of US taper is modest and reasonably well defined, signs
point to slower economic expansion in China. And even in the
near-term there is little visibility on that country's growth.
Pacific Money writer James Parker recommends the most insightful
economics and finance offerings.
S&P downgrades Turkey outlook to negative from stable – Reuters
Turkish Lira Dumps After S&P Warns, Cuts Turkish Outlook – ZH
Turkey Outlook Cut by S&P Citing ‘Hard Landing’ Risk – BB
MARKETS
The Singularity:
Hedge Funds Become One with the S&P 500 – Barron’s
Earning and Revenue
Beat Rates Remain Strong – Bespoke
Is the correction
over?
– Humble
Student
For now, my inner trader is getting ready for volatility and highly
tempted to go short this market as the SPX approaches the 50 dma at about the
1810 level. My inner investor is yawning and ignoring all of the short-term
fluctuations. If he had some new cash, he would regard the current weakness as
a buying opportunity.
Are Commodities
Breaking Out? – Short
Side of Long
FX Probe Extends To Options: "Oh God, Look What We've
Uncovered" – ZH
Foreign-Exchange Options the Latest Issue to Come Under Scrutiny – WSJ
Currency Market Roiled by Trader Exits as Lawsky Probes Banks – Businessweek
ECONOMICS
Negative money – Worthwhile
There are two parallel worlds. Both worlds use bits of coloured paper as
money, because barter is very difficult. The green world uses green paper as
money, and the red world uses red paper as money. The green paper money has a
positive value. The red paper money has a negative value.
Separating real from
nominal shocks – Worthwhile
Nobody wants a monetary policy that creates nominal shocks. "Don't
do random stuff with monetary policy for no reason at all!" is clearly
sensible and uncontroversial advice. But finding a monetary policy that
separates real shocks from nominal shocks, so that real shocks don't also
create nominal shocks, is harder. But that is exactly the sort of monetary
policy we want.
Stagnation by Design – Joseph
E. Stiglitz / Project Syndicate
Our current difficulties are the result of flawed policies. There are
alternatives.
Reinhart & Rogoff
: Recovery From Financial Crises: Evidence From 100 Episodes – The
Big Picture
Comparing U.S. and
Euro Area Unemployment Rates – FED
Employment relative to the population has declined in the euro area, but
the divergence of this measure from that of the United States is more modest
than suggested by unemployment rates. The difference is that, unlike in the
United States, the share of women in the euro area labor force is increasing, and
that development accounts for roughly half of the current gap between
unemployment rates in the two economies.
Does trend-chasing
explain financial markets? – Noahpinion
Speaking as an Old
New Keynesian … - Mainly
Macro
FINNISH
Brysselin kone: EU:n ja Kiinan suhteet – YLE
Miten EU:n
ja Kiinan taloudelliset suhteet ovat kehittymässä? Haastatteltavana dosentti
Mikael Mattlin ja toimittajana Maija Elonehimo.
Elvytystä
ja kiristystä mutta ei kunnolla kumpaakaan – Jan
Hurri / TalSa
Talouspolitiikka mutkittelee elvytyksen ja
vyönkiristysten välissä mutta ei tee kumpaakaan oikein kunnolla. Tulonsiirtojen
automaattielvytys kasvattaa alijäämää ja velkaa mutta ei taloutta.
Menoleikkurit ja veronkorotukset ärsyttävät taloutta mutta eivät saa sitä
tasapainoon. Näin Suomi yhdistää kahden talousopin haitat ilman kummankaan hyötyjä.
Outo poikkeus – Suomi maksaa
luottoluokituksesta
– Jan
Hurri / TalSa
Suomi maksaa luokitusyrityksille valtion oman
luottokelpoisuuden arvioimisesta siitä huolimatta, että EU varoittaa
ostoluokitusten riskeistä ja yrittää kitkeä niitä uuden luokitussääntelyn
keinoin. Suomi toimii toisin kuin Ruotsi ja suuret EU-maat – ne eivät tilaa
saati maksa luokituksia, mutta Suomi tilaa ja maksaa.
A-studio: Velka vie hallitus vikisee – YLE
Vieraina
kansanedustajat Miapetra Kumpula-Natri (sd.) ja Kimmo Sasi (kok.)
Aalto-yliopiston professorit Heikki Niskakangas ja Sixten Korkman.
SDP:n ykköstykillä ei hajuakaan valtion velan
määrästä – PS
Saksa,
EKP ja Saksan perustuslakituomioistuin – Deutschland über alles! – Tyhmyri
Syökö
inflaatio velat – vain hetkellisesti nopean muutoksen yhteydessä – Tyhmyri
Suomi,
Seurasaari – Saloniemi
Mitä pikemmin pääsemme vanhasta teollisuudesta
irti, ainakin tilastojen valossa sen parempi meille. Ja tässä on itseasiassa se
suuri ongelma. Asioista päättävät vanhat harmaantuneet sedät joita kiinnostaa
ainoastaan se, miten juuri oma firma saataisiin pysymään pinnan yläpuolella
vielä edes hetken.
DEBATTI:
Valtion
alijäämien hoitoon ei ole olemassa ”poppakonstia” – Tuomas
Malinen / US
Outoja
käsityksiä rahapolitiikasta ja keskuspankeista – tällä kertaa asialla
tutkijatohtori Tuomas Malinen – Tyhmyri