W/E: Weekly Support (updated)
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EUROPE
Europe
Bank Cleanup Driving $1.72 Trillion of Asset Sales – BB
Europe’s largest banks are finally putting
hundreds of billions of dollars of unwanted assets up for sale amid mounting
competition among buyers and regulatory pressure. A wave of deals could be a
boon to the region’s economy if the banks free up capital to increase lending.
GERMANY
Merkel
backs Guindos as eurogroup chair – FT
Selection
would mark a victory for Madrid, which has long complained that Spain is
under-represented in EU leadership positions
Record-low
bond yields, curve possibly inverting * EUR weaker
The
question now is whether Germans are more allergic to massive QE than they are
to relaxing their own budget constraints?
FRANCE
The
French crisis reflects the eurozone’s woes – FT
France condemned
by history to remain in lockstep with the Germans but clearly unable to keep
up.
Hollande
Bids to Quash Cabinet Mutiny With Minister Moves – BB
French
President Francois Hollande and Prime Minister Manuel Valls renewed the cabinet
as they moved to end an internal revolt over spending cuts and limit the mutiny’s
spread in their parliament group.
Hollande
Replaces Cabinet as EU Austerity Rebellion Stirs – BB
French
President Francois Hollande’s firing of malcontent minister Arnaud Montebourg
risks unleashing the ruling Socialist Party’s chief critic of budget cuts,
adding to an austerity backlash stirring across Europe.
Hollande
replaces firebrand minister – FT
Jonathan
Fenby: A day of reckoning – FT
Hollande
purges leftwing rebels – FT
Profile
Montebourg – loud and ambitious – FT
Insurrection
forces Hollande to act – FT
UKRAINE / RUSSIA
Vladimir
Putin may (or may not) enjoy 80% public support in Russia for his Ukraine
policy; but it has become increasingly clear that he has bitten off more than
he can chew. The question is: At what point will his position as President become
untenable?
EUROPEAN CENTRAL BANK
ECB
easing - will it work? No. 2: Liquidity and money market rates – Danske
Bank
(see the first
part, too)
The how,
what, where and when of Eurozone QE – TradingFloor
The
European Central Bank is facing mounting pressure to take steps to stimulate
growth in the euro area by creating liquidity through quantitative easing (QE).
Saxo Bank's Mads Koefoed shares his thoughts on when we can expect it - and
what this means for traders.
Draghi
May Again Find Bazooka Words Beat Action With QE – BB
Since Draghi
said last week that policy makers will use “all the available instruments
needed to ensure price stability” and are “ready to adjust the policy stance
further,” the euro has weakened and the region’s bond yields have dropped to
record lows.
UNITED STATES
MACRO DATA
Durable
Goods Report: July Data Dominated by Aircraft Orders – dshort
Durables
Goods, Excluding Bumper Boeing Orders, Suffer Biggest Drop Of 2014 – ZH
"Widespread
Slowdown In Home Price Gains": Case-Shiller – ZH
Some See
Price Gap Narrowing Between New, Existing Homes – WSJ
How Home
Prices Have Slowed Down, in Five Charts – WSJ
House
Prices: Real Prices and Price-to-Rent Ratio Decline in June – Calculated
Risk
U.S. home prices fall in June: S&P/Case-Shiller
– Reuters
More
Laid-Off Workers Are Bouncing Back, And Fewer are Taking Pay Cuts – WSJ
Consumer
Confidence Rises Again – dshort
Confidence
Spikes To 7-Year Highs, Near Record Divergence From UMich Sentiment – ZH
U.S. consumer confidence hits nearly
seven-year high in August – Reuters
ASIA
OTHER
Daily
Macro – WSJ
Attention
still focused on Jackson Hole. Draghi’s speech continues to reverberate after he dropped heavy hints
that the ECB hasn’t come to the end of what it can or will do to resuscitate
the single currency’s moribund economy and prevent it from sliding into
deflation. Especially after he warned that European inflation expectations were
starting to worry the central bank. Elsewhere, the news gets incrementally
worse on the Russia-Ukraine confrontation, the Gaza crisis, and over the Syrian-Iraqi
spiral into an ever deepening and vicious sectarian civil war.
Daily
Central Banks – WSJ
Hilsenrath’s
Take: Aircraft Orders Help U.S. Recovery, Ideas Jump Needed *Odds and Ends as
Jackson Hole Notebook Closes * BOJ Pushing for Greater Global Yen Role * Draghi
Brings Inflation Expectations Firmly Into Focus * Bank of Israel Cuts Key
Interest Rate to Record Low
Few
surprises at Jackson
Hole
symposium *USD continues to be undervalued * Political concerns in France now at forefront
Are we
overthinking everything in finance? – TradingFloor
Finance
world should more often admit lack of collective understanding * Old-school
grand economic theories do not hold against today’s real-time data * Fed wise
to be data driven; its dynamic approach to policy should be lauded
Recap
2014-08-25 – Global
Macro Trading
Quick
corrections followed by surges higher * J-Hole Yellen ambivalent, Draghi not as
dovish as people think.
Daily
Shot – TradingFloor
German
business confidence due to Ukraine and slowdown in Eurozone exports * 10-year
Bund hits record low, 3-year government notes also go negative * Fed behind the
curve on interest rate rise timeline
Today is
about Politics and US Durable Goods Orders – Marc
to Market
If The
Fed Is Preparing For Tighter Policy, Why Are Yields Still Falling? – Alpha
Now
STOCKS
Crossing
SPX 1000 in 1998 vs SPX 2000 Today – The
Fat Pitch
[US stocks
markets, first part technical analysis (The easy money has been made), this one top-down macro] So far
so good and I remain cautiously optimistic. However, these three tripwires bear
watching as they could warn of the start of either a serious correction or the
start of a bearish impulse in US equities.
FOREX
Rising
risk of currency market volatility – FT
Mohamed
El-Erian: After a prolonged period of
monetary policy alignment, advanced economies are embarking on increasingly
contrasting paths. This “multi-track” world of central banks reflects notable
divergence in underlying economic performance.
Great
Graphic: Currency Volatility Firming – Marc
to Market
Euro To
Remain Under Pressure On Worsening Rate Differential – Alpha
Now
The euro
peaked against the dollar in May. Its subsequent decline was accelerated by the
worsening rate differential between the yields of two-year notes of Germany and the U.S.
Avoid
trying to bottom pick EURUSD – TradingFloor
Bonds
markets re already pricing in what the market knows. QE is coming, but whether
the ECB is ready to deploy it, is another thing. The next CPI data and the
declining value of EUR should follow in lockstep.
FINNISH
Navigaattori: Niukka vaalivoitto heikentää Ruotsin
kruunua – Nordea
Muita aiheita: Draghi vauhditti euron heikentymistä * Odotukset
EKP:n lisätoimista painavat eurokorkoja * Raakaöljyn tuotantonäkymät vakautuvat
* Osakkeiden arvostus saa tukea osinkotuotosta * Rupla kelluu vapaasti jo ensi
vuonna * Korot ennätysmatalalla * Vuokrasopimuksen inflaatiosuojaus * Euroalueen
inflaatio putoaa kohti nollaa
Taloudellinen katsaus elokuu 2014 – Aktia
Kansainvälinen talous: kasvua geopoliittisten riskien
varjossa * Rahapolitiikassa EKP:n ja FEDin tiet eroavat * Euroalueella lyhyet
korot pohjassa pitkään * Suomessa kasvu karkaa kauemmaksi * Venäjän talouden
heikkous iskee montaa eri reittiä pitkin
Yritys nettoaa miljoonia EU-passien myynnistä – Verkkouutiset
Maltan valtio ja brittiläinen Henley & Partners
järjestävät asiakkailleen EU-kansalaisuuksia hieman yli miljoonan euron
kappalehintaan, asiakkaina arabit, venäläiset ja kiinalaiset
Tulisiko ministerin erota? – Jyrki
Virolainen
Elvytys ja sen ymmärtäminen oikein – Hannu
Visti
Vähittäiskaupan pikaennakko: heinäkuussa myynti -0,7% YoY – Tilastokeskus
Heinäkuun työttömyysaste 7,0 prosenttia – Tilastokeskus