Google Analytics

Tuesday, April 17

17th Apr - Dam the Flows?

Today's regular briefings for the US market opening and a host of again very pessimistic writings on the euro crisis. There are some hidden gems here, so read the summaries. Richard Koo, the interest rate guru at Nomura is already calling for restrictions on capital movement.


News And Market Re-Cap – RanSquawk / ZH
Frontrunning: April 17 – ZH
The Lunch Wrap – alphaville / FT
EM New York headlines – beyondbrics / FT
Morning MarketBeat: Apple Woes Contained, For Now – MarketBeat / WSJ
Morning Take-Out – DealBook / NYT
Daily Press Summary – Open Europe
  Germany rejects Sarkozy’s demands for ECB intervention to promote growth; IMF members call on Europe to increase bailout funds further

Debt crisis: live – The Telegraph
Europe Crisis Tracker – WSJ
Tracking Europe’s Debt Crisis – NYT
FX Options Analytics – Saxo Bank

EURO CRISIS
IMF still won't admit truth about the euroThe Telegraph
It is often said that travel broadens the mind. Not so for finance ministers gathering in Washington DC this week for the spring meeting of the International Monetary Fund and G20. For them, the agenda will seem wearily familiar.

Why Richard Koo’s idea won’t save the EurozoneFelix Salmon / Reuters
Koo: Eurozone governments should limit the sale of their government bonds to their own citizens. Salmon: limiting buyers to few assets would not make them purchase certain assets.

The Big Rift Between Germany and FranceTestosterone Pit
But his intent on debating the role of the ECB wasn’t a U-turn. He’d long advocated that the ECB act more directly in the debt crisis, one of the many points of conflict between him and Merkel—all swept under the rug during their dog and pony shows last October and November when they tried to portray a unified front in dealing with Greece. But now he has re-found his very French voice.

Europe’s balance sheet recession is a symptomPragmatic Capitalism
I see increasing chatter about a “balance sheet recession” in Europe, debt crisis or even a potential banking crisis.  But this is merely a symptom of what’s really ravaging EuropeEurope has a currency crisis.  The Euro is unworkable as is.

EURO CRISIS: SPAIN
Spanish-Bailout Chatter RisingMarketBeat / WSJ
“It is clear Spanish banks have been buying Spanish government bonds in an attempt to play the carry trade,” former Rothschild banker Kiron Sarkar wrote. Given rising bond yields, he said, the banks will see “material losses.” For now it seems the banks have run out of money and can’t buy any more bonds. That means Spain is going to have a “real problem” funding the rest of its financing needs this year.

The pain in Spain – reduxMacroScope / Reuters
The only other possible sentiment shifter in the short-term would be if the IMF managed to raise significant new crisis-fighting resources which could be deployed to defend a country like Spain

OTHER
Disclosure, transparency, and market disciplinevoxeu.org
Faith in market discipline has been shattered by the financial crisis. This column argues that the failure of market discipline has different roots. It points to a lack of transparency and efficiency, particularly when it is needed most. In order to rectify this, however, it is not enough to merely increase the provision and disclosure of information. Instead, transparency depends on how that information is interpreted and used.

Four trends in central bank-landalphaville / FT
 …make fantastic political punching bags, and the popularity of this tactic is growing…(maybe) moving away from inflation targeting…not liking the euro…becoming equities-curious.

Dividends Keep You AnchoredThe Psy-Fi Blog

Global Trade Set for a Downturn?Alpha Now / Thomson Reuters
traffic through the Suez Canal in Egypt – a key cargo transportation route – has nosedived in recent weeks and months.

What five years of crisis history tells usalphaville / FT
the crisis sparked by subprime mortgages now has nearly five years’ worth of observational data. This is very exciting for nerds, since the conclusions from studying the period will get progressively more meaningful and insightful — something not lost on the credit strategy team at Deutsche Bank when they published their 2012 Default Study on Monday.

OFF-TOPIC
FiveBooks Interviews: Keith Lowe on the Aftermath of World War TwoThe Browser
Europe after the war was a scene of both physical and moral destruction. The author of Savage Continent recommends essential reading for understanding the suffering, dislocation and fighting after the war was over

A Curated Linkfest For The Smartest People On The Web!Simoleon Sense

The Perils of Paying for StatusScientific American
Knowing when to pass on that luxury limo or overpriced pen

#EconohipstersNPR
Econ nerds ran wild on Twitter today with a pair of hashtags -- #econohipster and #econohipsters. Here are a few of our favorites.

Visualizing Ocean ShippingSapping Attention
1) about 100 years of ship paths in the seas, as recorded in hundreds of ship's log books, by hand, one or several times a day. 2) seasonality: it compresses all those years onto a single span of January-December, to reveal seasonal patterns.