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EUROPE
The
Italian budget: in trouble in Brussels? – FT
The
Commission now has two weeks to decide whether it can accept the Italian budget…It
will be the subjective judgement of whether the Commission can, with a straight
face, say Italy has implemented sufficient reforms
to allow for “deviation” from its debt target. The smart money right now is
that Rome will get a pass, largely for political reasons. But if you follow the
rules, it probably shouldn’t.
European
banks and the global banking glut – Pieria
So there we
have it. Forget Asian savers, the yen carry trade, Wall Street excesses. The 2007-8
financial crisis was all the fault of European policy makers and regulators.
Quicktake:
The European Parliament – BB
Unifying
the EU, or Busting It?
Charlemagne:
The squeezed middle
– The
Economist
Populist
parties are narrowing governments’ options in Europe
Cameron
eyes quotas for EU workers – FT
PM
considers cap on national insurance numbers to limit migration
GERMANY
Two new
books show that the euro crisis is far from over
Germany is coming face to face with the
reality that it's locked in a feedback cycle with its common-currency partners.
Out of
Balance? Criticism of Germany Grows as Economy Stalls – Spiegel
The latest
indicators suggest Germany's once buzzing economy is beginning to stall. The
development has created a serious dilemma for Finance Minister Wolfgang
Schäuble. Critics say spurring growth is more important than his goal of a balanced
budget.
The German
government should invest money in infrastructure, not worry about balancing its
budget
German
politics: Sedating, not leading – The
Economist
Abroad and
at home, a rising chorus is criticising Germany’s chancellor, Angela Merkel, for
her economic policies.
The
Reckoning: Kohl Tapes Reveal a Man Full of Anger – Spiegel
Helmut Kohl
spent over 600 hours speaking with the journalist Heribert Schwan about his
life's work. The secret tapes reveal a chancellor resentful of his public image
and disdainful of many of those around him, including Angela Merkel.
EUROPEAN CENTRAL BANK
European
Central Bank suffers leak of secret minutes – FT
Weaker
euro won't do much to stoke inflation – Reuters
The ECB not-so-secretly
hopes a cheaper currency will boost euro zone inflation. Good luck. The fall in
dollar-denominated commodity prices is deflationary. And with demand weak,
firms will struggle to pass on higher import prices. Only a huge euro slump
would bring real relief.
UNITED STATES
Six
charts on the shocking rise in inequality – WaPo
Roll Out
the Fire Hoses (Here Comes QE4) – Wolf
Street
Never
before in the long, comic history of mankind and its money have central bankers
taken such a keen interest in asset prices. Now they create money, out of
nowhere, for the express purpose of pushing them up.
Quicktake:
The Fed’s Taper – BB
A Slow
Farewell to a Gigantic Stimulus
The Fed
finally says “enough”
– The Money Illusion
ASIA
An
enigmatic slowdown –
The Economist
China does not need a 2008-style
stimulus, which pushed inflation far above target. But it does need a bigger
impetus than it has received thus far. Most economists looking at the nameless
chart above would conclude that the economy is failing to make the most of its
growth potential. That conclusion should not change just because the word
“China” is added to the title.
MARKETS
Global
Housing Watch October 2014 – IMF
Developments
in real estate markets have led to seemingly contradictory concerns about both
overheating and slow recovery.
The
good, the bad and the ugly of falling energy prices – Sober
Look
The recent
correction in the price of crude oil should have an immediate positive impact
on the US consumer as well as on a number of business
sectors. However there also may be a significant economic downside to this
adjustment.
Global
Macro Update – Short Side
of Long
The most
volatile week since the Eurozone Crisis during 2011 * Global stock and
commodity markets under pressure this week * Annualised returns show Treasuries
outperforming other assets
A nod
toward market monetarism at the FT? – The Money Illusion
Markets:
Into uncharted waters
– FT
After the
volatility, investors face the hard reality that stocks and bonds still look
expensive
ECONOMICS
It takes
$200bn per quarter to feed the machine – FT
The charts
suggest that zero stimulus would be consistent with 50bp widening in investment
grade, or a little over a ten percent quarterly drop in equities. Put
differently, it takes around $200bn per quarter just to keep markets from
selling off.
One
simple reason why global stock markets are reeling – The
Telegraph
The world's
central banks have slashed stimulus by $125bn a month since the end of last
year - leading to the current market rout
What is
global market turbulence telling us? – FT
The markets
may be starting to doubt whether the central banks actually have the weapons
needed to stop global deflationary forces in their tracks… But the relief rally
on Friday, triggered by the merest hints that central banks may consider
further asset purchases, suggests that we are not there yet.
World
braces as deflation tremors hit Eurozone bond markets – The
Telegraph
'The forces
of monetary deflation are gathering. Global liquidity is declining and central
banks are not doing enough, either in the West or the East to offset the
decline,' warns CrossBorderCapital
Tighter
monetary conditions – not lower oil prices – are pushing down inflation
expectations – Market
Monetarist
Sign
wars, and stability, with price level targeting – Worthwhile
It’s
official: Inflation is dead – WaPo
Monetary
policy: Tight, loose, irrelevant – The
Economist
Interest
rates do not seem to affect investment as economists assume
5
Reasons to Worry About Deflation – WSJ
Rogoff
review of Martin Wolf’s “The Shifts and the Shocks” – Harvard
Krugman
review – The
New York Review Books
“An extraordinary work that deserves to be widely
read and discuss
OFF-TOPIC
Making
the world’s problem solvers 10% more efficient – Medium
Ten years
after a Google engineer empowered researchers with Scholar, he can’t bear to
leave it
Needed: Better
Batteries (Seriously)
– View
/ BB
One of the
truisms of the 1970s was that solar power was a pipe dream… this fact is
rapidly becoming a non-fact. The cost of solar power has fallen off a cliff -- it
is now less than 1 percent as expensive as it was in 1977.
35 Years
Ago Today, Spreadsheets Were Invented – The
Atlantic
Happy
Spreadsheet Day! It's time to celebrate the tool—and fear its capacity for
destruction.
The Best
Film About Islamic Terrorists Is a Comedy – The
Atlantic
Chris
Morris' Four Lions, released four years ago, skewers the pointlessness and
confusion of wannabe jihadists.
When the
richest woman in Monaco, real-estate heiress Hélène Pastor, was gunned down in
Nice, last May, rumors flew in the tiny principality: It was a gangland-style
assassination . . . No, it was a message from Vladimir Putin to Obama . . . No,
the strong-willed 77-year-old billionaire had angered one of her powerful
tenants . . . Delving into the Pastor family history, Mark Seal investigates a
motive for murder that couldn’t be closer to home.
These
Are the Emails Snowden Sent to First Introduce His Epic NSA Leaks – Wired
Six months
before the world knew the National Security Agency’s most prolific leaker of
secrets as Edward Joseph Snowden, Laura Poitras knew him as Citizenfour. For
months, Poitras communicated with an unknown “senior government employee” under
that pseudonym via encrypted emails, as he prepared her to receive an
unprecedented leak of classified documents that he would ask her to expose to
the world.
FINNISH
Tekeekö Saksa sen taas – töpseli seinästä – Jan
Hurri / TalSa
Finanssimarkkinat hermoilevat, eikä ihme. Ilmaisen rahan
virta keskuspankeilta uhkaa ehtyä, kun Yhdysvaltain Fed sulkee hanojaan ennen
kuin euroalueen EKP saa omia hanojaan apposen auki. Hermoilu voi pahentua – ainakin,
jos Saksa tekee niin kuin 22 vuotta sitten: vetää töpselin seinästä.
Öljyn hinnan lasku on Venäjälle liikaa – Nordea
Huomio on palannut Ukrainasta Venäjän talouteen, eikä sekään
ole miellyttävää katsottavaa. Liiketoimintaympäristö on heikentynyt entisestään
ja lännen sanktiot vaikeuttavat rahoitussektorin toimintaa. Venäjä on
painumassa luottolamaan. Lopulta myös Venäjän onni näyttää kääntyneen, kun
viime viikkoina öljyn hinnassa on nähty yllättävän suuri pudotus.
Suomi: Pohjoismaiden musta lammas – Nordea
Juhana Vartiainen: Ay-liikettä uskallettava uhmata – Verkkouutiset
Valtion taloudellisen tutkimuskeskuksen ylijohtaja Juhana
Vartiainen toivoisi, että Suomessa skallettaisiin haastaa työmarkkinajärjestöt
Ruotsin tapaan.