Previously on MoreLiver’s:
Roundups &
Commentary
News – Between
The Hedges
Markets – Between
The Hedges
Recap – Global
Macro Trading
The Closer – alphaville
/ FT
US: Volatility Gets A
Harding On Taper Chatter – ZH
EUROPE
To succeed in the twenty-first
century, the European Union needs to move forward now toward greater
integration. This is how to do it.
During a hearing on
the constitutionality of the ECB’s measures to prevent the eurozone from
falling apart, Andreas Vosskuhle, President of Germany’s Constitutional Court, raised an important question: Do non-German
economists condemn the ECB’s measures as unequivocally as most German experts
do?
ESM
ESM’s direct recap plan: Really ‘breaking the
link’? – Brussels
blog / FT
Remember a year ago
when eurozone leaders promised to “break the vicious circle” between banks and
sovereign governments by allowing the eurozone’s €500bn rescue fund to bailout
struggling banks instead of leaving the task to cash-strapped national
treasuries?
No Break for Periphery Banks – CFR
EU ministers
apparently made little progress last week on terms under which the European
Stability Mechanism (ESM) would recapitalize weak banks, though they still hope
for an agreement by end month.
ECB
Under trial – Free
exchange / The Economist
Germany regards
European integration, of which the euro is the apotheosis, as a crucial
national interest. The judges in Karlsruhe are wary about reaching any judgment
that would conflict with this overriding foreign-policy objective.
The ECB is not breaching the law – Free
exchange / The Economist
We have invited Holger
Schmieding, chief economist at Berenberg Bank, to discuss the legality of the
ECB's actions.
A broad deepening of
fiscal integration leading toward a "fiscal union" in the euro zone
requires deeper public support than currently exists both inside and outside Germany, ECB Governing Council member Jens Weidmann
said.
Yves Mersch: The European Central Bank’s role
in overcoming the Crisis – ECB
UNITED STATES
FOMC preview – Danske
Bank (pdf)
Once again Bernanke
faces a communication challenge
Fed heading for exit: stand clear of the
closing doors – Nordea
(pdf)
Or the summary here.
Watch What Fed Says, Not What It Does – WSJ
At this week's Fed
monetary policy meeting, it comes down more to what officials will say, than
what they'll do.
The Fed’s Tapering Trial Balloon – WSJ
“It may be that
policymakers wanted to ‘test the waters,’ determine the pervasiveness and
ultimately force the shake out of some carry trades,” BCA Research wrote in a
report.
Why the Fed’s ‘Tapering’ Matters So Much – WSJ
Ahead of the Fed’s
two-day meeting, beginning tomorrow, here’s a look at what has happened in the
markets since Bernanke said on May 22 that the Fed could start pulling back its
bond buying sometime within the next few meetings.
FOMC Meeting Begins Tomorrow – Tim
Duy’s Fed Watch
This FOMC meeting is
about the Fed regaining - or further losing - control over its communication
strategy. Bernanke will attempt to
detail how exactly the data flow is supportive of scaling back asset purchases
in the next few months (I believe the Fed prefers September) while at the same
time disassociating asset purchases from interest rate policy.
Taper talk persists despite missed jobs,
inflation targets – MacroScope
/ Reuters
So, either
policymakers see brighter skies ahead or they want to get out of QE3 for other
reasons they may rather not air too publicly: worries about efficacy or
possible financial market bubbles.
FT Joins The Fray: "Fed Likely To Signal
Tapering Move" – ZH
Ben Bernanke is likely
to signal that the US Federal Reserve is close to tapering down its
$85bn-a-month in asset purchases when he holds a press conference on Wednesday,
but balance that by saying subsequent moves depend on what happens to the
economy.
What The Fed Is Looking At – ZH
From an economics
perspective it was just a matter of time before conditions began to break down;
gains in equity indexes to record highs amid sluggish economic performance were
simply unsustainable.
JPMorgan: "Fed Stimulus Inflated Prices....Removal
Could Create Tail Event" –
ZH
Then:
Risk-On/Risk-Off: Ironically, positive data caused equities and bonds to trade
lower on increased probability of tapering (good data were bad for stocks)….Now:
the "Fed Regime": ecent bouts of positive correlation of equities,
bonds and commodities, suggest that the Fed’s stimulus inflated prices of a
broad range of financial assets, and removal of the stimulus could create a
tail event in which prices of all assets could go down.
What the Fed tapering debate and Justin Bieber
obsession has in common – Wonkblog
/ WP
If the economy evolves
as expected, has the Fed become any more or less inclined to maintain its easy
money policies than it was a few months ago? I am reasonably confident that the
answer to that is no, and that the volatility we’ve seen in markets around the
tapering debate is not grounded in something real.
MACRO
DATA
Empire Manufacturing:
A Weak Stronger Than Expected Report – Bespoke
NY Fed Manufacturing
Index Improved in June – WSJ
Headline Beats Despite
Plunge In Most Indicators, "Labor Market Conditions Worsened" – ZH
FINNISH
Wahlroos:
Tärkeimmästä asiasta vaiettiin Kultarannassa – HS
Nordean hallituksen puheenjohtaja Björn
Wahlroosin mielestä presidentin järjestämässä keskustelussa pitäisi keskittyä
Euroopan talouteen ja sen rahapolitiikkaan, mutta niihin ei avauskeskustelussa
kajottu.
Tuomioja:
EU:lle ei ole Suomessa vaihtoehtoja – HS
Maailman muutos kirvoitti ulkopolitiikan
tuntijoilta monta erilaista vertauskuvaa presidentti Niinistön
Kultaranta-keskusteluissa
Attacin
raportti nostatti raivon Saksassa: "Kreikka-tuki mennyt lähes pelkästään
pankeille" – YLE
Süddeutsche Zeitung -sanomalehden siteeraaman
raportin mukaan Saksa on antanut Kreikalle hätälainaa 207 miljardia euroa,
josta lähes 160 miljardia euroa on mennyt pankeille ja sijoittajille.
Puheen
Iltapäivä: Mielipiteitä Suomen nykytilaan ja tulevaisuuteen – YLE
Kirjailija ja kolumnisti Kalle Isokallio
kertoi Puheen iltapäivässä totuuksia Suomen tilasta. Toimittaja Miia Krause