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EUROPE
The EU debate should
be about democracy, freedom, closer economic and political relationship with
the rest of Europe but not what we currently have
ELECTIONS
Despite election results, reason still rules
Europe – Reuters
Somewhat more than a harmless warning – BNP
Paribas
Paradoxically, the
fact that it will be hard to establish a partisan majority should make broader
compromises easier. These extremes are looking above all to have an influence at
the national level. The main risk is that European political ambitions will be
reduced.
The most vocal
supporter of a trade deal with the U.S., the center-right European People’s Party, is
expected to hold 213 seats in the new Parliament, down from 274 seats. In turn,
a swell of new, largely unaffiliated lawmakers will join the body, many of them
skeptical of the EU’s scope and powers.
Europe’s angry voters: Bucked off – The
Economist
Europe’s elections: The Eurosceptic Union – The
Economist
Germany’s European elections: An alternative becomes real – The
Economist
European elections in
the Nordics: Schadenfreude – The
Economist
EUROPEAN
CENTRAL BANK
The case for a better functioning securitisation
market in the European Union –
ECB
Joint paper by ECB
& BoE.
Waiting for the ECB – BNP
Paribas
FI & FX Strategy - Scandies through the
lens of ECB action – Nordea
In our view, the risk
that ECB will disappoint markets in a meaningful way is limited and when a
central bank is increasing the amount of stimulus it’s indeed difficult to end
up with the conclusion that it will lead to negative market effects. However,
things like negative deposit rates and QE is uncharted action in its nature and
can nevertheless trigger flows and chain reactions in asset space that may not
be ideal – particularly in the light of the past years one-sided action in
risky assets and fixed income spread-over, and given the abnormally high
directionality these different assets have exhibited…
Protecting European bank test data from
lucrative leaks – Reuters
It would be an insider
trader's dream to know ahead of time which of Europe's banks will fail or need more capital, and
all that data will be stored somewhere in cyberspace as the ECB assesses the
euro zone's top banks.
UNITED STATES
FEDERAL
RESERVE
Yellen’s comms adviser: more press briefings – FT
Even The Fed Admits The "Natural"
Rate Of Interest Is Lower Than Markets Are Pricing – ZH
As BofA explains, the
natural rate is unobservable and varies considerably over time.
Peterson’s Posen Argues in Favor of a
Supercharged Fed – WSJ
As the Fed begins
winding down its aggressive easy-money policies, at least one former central
banker says it should consider acting more boldly to spur stronger economic
growth.
Fed Ignores Policy Rules at Own Peril, Paper
Finds – WSJ
The U.S. economy fares best when the Federal Reserve
adheres most closely to traditional policy rules, according to new research
that suggests the recent period of unusually low interest rates may be doing
more harm than good.
With Central Bank Balance Sheets, Big May Be
Beautiful – WSJ
The Fed's ability to
pay interest on money that banks park at the central bank changes the dynamics
of monetary policy permanently, and in a good way
OTHER
On the Eurasian Customs Union Agreement – Econospeak