25th Apr - Bernanke's Babble

Markets waiting for the FOMC details, bad macro numbers confirming that decoupling was illusionary, as expected. Of major interest are the latest bank lending figures from the ECB that now include data on national level. Surely someone will soon write about those, but expect no surprises. We kind of already know which countries are in trouble, and mirroring that, which countries are also in trouble, as they have receivables from the crisis-torn periphery.

News And Market Re-Cap – RanSquawk / ZH

Frontrunning: April 25 – ZH

Overnight Sentiment: – Bank of America / ZH

The Lunch Wrap – alphaville / FT

EM New York headlines – beyondbrics / FT

Morning MarketBeat: Our Chatty Fed – MarketBeat / WSJ

Morning Take-Out – DealBook / NYT

AM Dear Dairy – Macro and Cheese

Daily Press Summary – Open Europe

  EU Commission set to propose 6.8% increase for 2013 EU budget

TV: Bloomberg, CNBC, BBC

Debt crisis: live – The Telegraph

Europe Crisis Tracker – WSJ

Tracking Europe’s Debt Crisis – NYT

FX Options Analytics – Saxo Bank

EURO CRISIS: GENERAL
Rank by correlation, European edition – alphaville / FT
As markets ponder France’s post-election future, and the Dutch deal with the collapse of their government, some analysts are wondering which countries even qualify as being in the “core” of Europe.

Europe's terrible blunder can be rectified. Remember 1931 – The Guardian

The euro was a blood sacrifice to the Eurocrats' fanaticism. But Europe's democracy may save us from Europe's single currency

The Unbearable Slowness of Internal Devaluation – Krugman / NYT
The euro area’s economic strategy, such as it is, rests on two pillars: confidence through austerity, and “internal devaluation”. You know how the first is going; what about the second?

The Big Wrong – Krugman / NYT
Recent election results in Europe seem to have raised consciousness in a way literally years of economic data couldn’t: the austerity doctrine that has ruled European policy is a big fat failure.

The euro’s salvation lies in a little less Europe; not more Europe – voxeu.org

Avinash Persaud: Does Europe need a fiscal union to support its monetary union? This column argues that the cause of Europe’s problems is not public sector ill discipline but rather private sector ill discipline. In such a situation, it asks whether we should be trying to save a drowning man by putting him in a straightjacket.

The World from Berlin:  'Berlin Is Running Out of Allies in Euro Crisis' – Spiegel

The collapse of the Dutch government, the prospect of Socialist François Hollande as next French president and the surging popularity of far-right parties shows that budget discipline is out of fashion in Europe. Chancellor Angela Merkel is looking increasingly lonely in her fight to save the euro through painful austerity measures, write German commentators.

How should the IMF spend its 430bn US$? – bruegel

The larger the IMF’s involvement in countries of the euro area, the more it should demand from the Eurogroup collectively and Fund’s member states located in the euro area individually to address these design flaws.

The weak power syndrome – bruegel

Thus the euro zone is caught between weakness and limitation. It has not yet achieved a stable balance; for this reason, I would suggest that it is going to have to move in the direction of a greater clarification of areas of responsibility. We need more centralisation in certain areas and less in others.

Europe's New Entente Discordiale: The Other French Connection – ZH

In summary, there is now evidence an overwhelming political force in the Eurozone, perhaps almost all of French voters, are against growth and against fiscal and monetary responsibility.

EURO CRISIS: ECB

Presentation of the ECB Annual Report 2011 – ECB

Speech Vítor Constâncio to the Committee on Economic and Monetary Affairs of the European Parliament – ECB

Annual Report 2011 – ECB (pdf)

In Monetary Union, the risk that the Eurosystem central banks (that is, the ECB and the euro area NCBs) face relates to the conduct of monetary policy operations itself, not to the associated TARGET2 balances.

Press Release: Results of the Apr-2012 bank lending survey for the euro area – ECB

For the first time, detailed data series for the aggregate euro area results as well as the country-level results in terms of net percentages and/or the diffusion index for 11 euro area countries have now been made available (link to docs)

ECB to the rescue? Hold your horses – MacroScope / Reuters

The ECB will, of course, act if the crisis drives Europe right back to the brink, it’s mandate will pretty much demand it at that stage but we’re not anywhere near there yet – contrary to what many in the markets believe.

Global economic outlook - what is the best policy mix? – BIS (pdf)

Speech by Dr Jens Weidmann, President of the Deutsche Bundesbank, at the Economic Club of New York, New York, 23 April 2012.

Hearing at the Committee on Economic and Monetary Affairs – ECB

Introductory statement by Mario Draghi, President of the ECB, Brussels, at the European Parliament, 25-Apr-2012

OTHER

Saudi oil puzzle, continued – alphaville / FT

Goldman Sachs: The foremost question being: why would Saudi Arabia increase its oil production to the highest level in over 30 years to simply put the crude oil into storage?

The Earnings Beat Rate In Perspective – The Big Picture

Long time readers will know that we have called earnings beat rates a meaningless statistic.  Companies always handily “beat” the consensus and get the positive press and accolades that come with it. Further, it seems that everyone is happy with this apparent gaming of the system.

RoRo and the BoJ – alphaville / FT

The Bank of Japan’s monetary policy decision on Friday has been powerfully talked up by analysts and officials alike, with the bank under real political pressure to satisfy market expectations and announce new easing measures that target inflation and growth.

UK recession in charts – MacroScope / Reuters

Strategic Briefing 25-Apr: A New Recession For Britain – The Capital Spectator

Summaries and links to articles

Who do the politicians work for? – Deus Ex Macchiato

In other, plain words, they don’t work for you even – especially – if you are a party member. They work for the apparatus; and that, of course, means mostly those with the money, the media, and the lobbyists.

Efficiency May Be Special Case of Adaptation – All About Alpha

In the context of finance, this means that individuals will make decisions according to sometimes rough rules of thumb, “heuristics,” to survive the challenges with which they are familiar, and that “as long as those challenges remain stable, the heuristics will eventually adapt to yield approximately optimal solutions to them.”