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Things you shouldn’t do
Climateer posted a wheninfinance gif from last year, noting market-on-close commentary. Wheninfinance’s original title in bold below. That happened at work last year. Bravo, indeed.When someone decides...
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Market not ready for Polish rate cut
So the Polish central bank cut its reference rate by 50bps. And it was unexpected.Pawel Morski on twitter had a great catch:Showing that absolutely none of the economist pooled by Bloomberg had a 50bps...
View ArticleCost of currency collapse
‘Currency collapses and output dynamics: a long-run perspective’ by Camilo E. Tovar. A couple of years old, but worth reading. It’s short, too.Here’s the abstract:Currency collapses, defined as large...
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Borrowing in Spain and Italy is expensive — let’s securitize it away
One of the main problems for Europe is the broken transmission mechanism. It’s been a problem for quite some time.When the ECB cut its rate, it won’t pass through to the areas of Europe that need it:...
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The Fed’s exit strategy
I posted on the subject a week ago, and now I’ve come across a paper from the Fed’s research department from September, so it might be worth just posting it here, since it gives a timeline to a...
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The size of Africa
This from Goldman Sachs is a very good picture of just how big Africa really is:Nothing new, of course — but cool.
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Happy Pi day!
I didn’t know this was a thing, but it is awesome. Today is Pi day in the US (3.14) and Europe will have it’s Pi day on July 22 (22/7). It’s also Albert Einstein’s birthday today. Here’s Climateer with...
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Banks’ CA holdings, excess reserves, and recourse at the deposit facility
From the ECB’s monthly bulletin, out yesterday.
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Cyprus deposit tax reading [updated]
Much has been written today on the deal from last night, and I don’t have anything to add, except to say that the deposit tax on small depositors is a very, very dangerous route to take… Here are the...
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Two-tiered Europe, redux
Relatively silence from this end as of late, given other commitments (mostly exams.) I did stump upon this paper from the ECB yesterday, though, which elaborates on the discussion of the two-tiered...
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‘Love letters’
One exam done. So I was reading up on capital controls and a lot of people seem to make the Cyprus-Iceland analogy, which got me thinking about how Icelandic banks used to issue ‘love letters’ to each...
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The ECB can deal with bank funding problems
Benoît Cœuré from the ECB is usually the best when it comes to writing (and speaking) about the transmission mechanism and market operations. Since he’s responsible for Market Operations; Payments...
View ArticleFinancial innovation, Rockefeller style
Reading through papers and books of economic history of early financial innovations, I came across this nice little setup.The year was 1899. Henry Rogers and William Rockefeller wanted to buy Anaconda...
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Luxembourg AAA? Really?
Pictet with the graph:And what’s the verdict from the rating agencies for Luxembourg?Moody’s: Aaa S&P: AAA Fitch: AAAErr, okay, then. Hat tip Barnejek.
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Worst graph of the year nomination
A Danish newspaper called Børsen takes the prize for the worst graph I’ve seen in a long time:It’s a (sad) graph of the price action in Brøndby IF’s stock price (my football club). On the right hand...
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Largest arb ever based on renegotiated ISDAs?
Tracy Alloway pointed me to this cool story today, about a very large arb. It was an arb of the US Treasury vs. TIPs market. Izzy has previously written about it (#1, #2, #3, #4). The trade was rather...
View ArticleWhat have we learned from Danish negative deposit rates?
I was going to do something on negative rates, but I’m busy and Nordea has written a good primer, and I still think me and Izzy’s post from July last year when they were introduced is pretty...
View ArticleDenmark’s experience with negative deposit rates
My piece for FT AV can be found here:FT Alphaville: What the Danish negative rate experience tells us.
View ArticleEurope’s problem is monetary, but that’s not all
Lars Christensen has a pretty good post on how Europe’s problems are not fiscal when you compare it to the US. He points out — rightly, I think — that the difference in recovery between the US and...
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Probability the Danish krone breaks its ERM-II peg
The IMF is out with its review of how the fund did on the whole Greece thing. Joseph Cotterill has a good write up.I’m still reading through it, but I do want to flack one thing. On page 32 is a proxy...
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