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Tuesday, April 9

9th Apr - US Close: Soros, Yen, LTRO



Soros requests Germany to leave the euro or accept eurobonds. The sources of demand and supply of the yen is also interesting. 


Instead of continuously posting the regular links, they are now moved to a permanent page. My standard posts would thus in the future only have article links and my own thoughts. If this is ok with you, fine. If not, drop me a message.


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EUROPE
Germany’s ChoiceProject Syndicate
George Soros: Contrary to popular opinion in Germany and elsewhere, the euro crisis – for which Germany is disproportionately responsible, owing to its dominant position – is far from over. Despite the complex political and economic origins of Europe’s current malaise, the solution can be summed up in one word: Eurobonds.

How to save the European UnionThe Guardian
George Soros: There is a strong case for Germany to make a definitive choice whether to accept eurobonds or to leave the euro

Catching up on the LTRO flowalphaville / FT
Barclays’ forecast puts the breach of the ‘psychological level’ of €200bn, below which Eonia may start to be sensitive to changes in liquidity conditions, in Q3/Q4 if the pace of weekly repayments remains at around €6bn (the average weekly payback, excluding the two big repayments on the first day of the exit option window for each operation).

US keen for Germany to lead EU out of crisiseuobserver
US treasury secretary Jack Lew on Tuesday hinted that Germany should boost its internal demand to help Europe get out of the crisis.

Press release Results of the Eurosystem’s first Household Finance and Consumption SurveyECB

European Governments' Unpaid BillsMarc to Market
For the first time, last October Eurostat published a note on the "stock of liabilities of trade credits and advances".     These are the unpaid liabilities of governments used to purchase goods and services.  These are, incidentally are not included in the Maastricht definition of government debt.

The economic outlookBIS (pdf)
Speech by Mr Øystein Olsen, Governor of the Norges Bank (Central Bank of Norway), to invited foreign embassy representatives, Norges Bank, Oslo, 4 April 2013.

  PIIGS
Euro or Drachma, or Both? A Temporary Parallel Currency ConceptEconoMonitor
Only our suggestion of a parallel currency combines the advantages inherent in the internal devaluation and exit policies: it provides instant devaluation while staying within the euro community with a defined schedule for full reintroduction of the euro as the sole legal tender

Italian Politicians Enter Government Countdown PhaseWSJ
The clock is ticking for politicians in Italy ahead of April 18, when newly-elected lawmakers begin to vote for a new head of state, writes Christopher Emsden.

UNITED STATES
361 Capital Weekly Research BriefingThe Reformed Broker

ASIA
Fitch Downgrades China and Thoughts about the YuanMarc to Market

Front-Running Markets Get Carried Away By Bank of JapanWSJ
“For every Japanese investor seeking yield, there is a foreign one searching for returns from Japanese equities”

Mr Soros Trumps Mrs WatanabeZH
The bulk of JPY selling pressure has come during non-Tokyo trading hours,

Japan’s currency war has just begunMacroBusiness
Global macro UBS analyst, Syed Mansoor Mohi-uddin, has a very neat little note out this morning summarising the revolution that has just taken hold of Japanese monetary policy

Taking QE to a whole new levelSober Look

OTHER
The Global Growth QuestProject Syndicate
Mohamed A. El-Erian: The last few years have highlighted the declining potency of long-standing growth models. Moreover, the search for more robust growth models will take much longer and be more complicated than many recognize – especially as the world economy pivots away from unfettered globalization and high levels of leverage.

Nordea Risk Perception Index – Week 15Nordea (pdf)
Return to more comfortable levels, but low-for-long is acknowledged (summary here)

Commodities Forecast Update Danske Bank (pdf)
Rebound in Q2 but no H1 catch-up with equities

Global exports are on the rebound - will corporate sales follow?TradingFloor
The 6-month lagged annual change in global exports explains around 60 percent of the annual change in S&P 500 revenue. Given the recent uptick in global exports we are increasingly confident about corporate revenue figures for the next few quarters.

Stress testing banks - what have we learned?BIS (pdf)
Speech by Mr Ben S Bernanke, Chairman of the Board of Governors of the Federal Reserve System, at the "Maintaining financial stability: holding a tiger by the tail" financial markets conference, sponsored by the Federal Reserve Bank of Atlanta, Stone Mountain, Georgia, 8 April 2013.

Book Review: Quantitative ValueCFA Institute

World Economic Outlook (WEO)IMF
Chapter 3: The Dog That Didn't Bark: Has Inflation Been Muzzled or Was It Just Sleeping? * Chapter 4: Breaking through the Frontier: Can Today's Dynamic Low-Income Countries Make It?

Pirates of the Caribbean: Global Resistance to Tax Havens GrowsSpiegel
Tax havens cause hundreds of millions of euros in annual damage to national economies around the world and they create an uncontrollable parallel economy. The recent Offshore Leaks investigative reports are helping to fuel efforts in Europe and the US to have them eliminated.

  THATCHER
How Mrs Thatcher smashed the Keynesian consensusFree exchange / The Economist

Euro-Skepticism was Thatcher’s Most Relevant Legacy; Had Europe Only ListenedMish’s
http://globaleconomicanalysis.blogspot.fi/2013/04/euro-skepticism-was-thatchers-most.html

Five thought-provoking reads on Margaret ThatcherThe World / FT