September 15, 2011: ECB's Stark To Leave Over Bond-Buying Row - Sources [Newsletter]

September 15, 2011

JLN Interest Rates - http://www.jlninterestrates.com


Conversation Starter


Tom Callahan - NYSE Liffe U.S. [INTERVIEW]
MarketsWiki.tv
NYSE Liffe U.S. this week reached the 10-million mark in its interest rate complex, introduced first in March of this year. Tom Callahan, CEO of the exchange, talked with John Lothian News (JLN) Managing Editor Christine Nielsen about the exchange’s growth in these contracts amid a tumultuous economic environment and evolving regulatory landscape.
http://jlne.ws/n2XoDo


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-- Christine Nielsen



Lead Stories

ECB's Stark to leave over bond-buying row-sources
Reuters
ECB Executive Board Member Juergen Stark will step down from his post because of a conflict over the central bank's controversial bond-buying programme, two sources told Reuters on Friday.
http://jlne.ws/oodBoh

ECB: ECB announces additional US dollar liquidity-providing operations over year-end
The Governing Council of the European Central Bank (ECB) has decided, in coordination with the Federal Reserve, the Bank of England, the Bank of Japan and the Swiss National Bank, to conduct three US dollar liquidity-providing operations with a maturity of approximately three months covering the end of the year.
http://jlne.ws/rjMVGZ

Treasury Prices Jump on ECB Resignation
By CYNTHIA LIN, WSJ.com
NEW YORK—Treasury prices shot higher on news that European Central Bank chief economist Jürgen Stark resigned and amid speculation that the resignation is due to disagreements over supporting the struggling euro-zone members.
http://jlne.ws/mVwBZX

Crisis forces banks to tap ECB dollar funds again
By Marc Jones, Reuters
Two undisclosed banks tapped the European Central Bank for dollar funding on Wednesday, the second time in a month the facility has been used and the latest indication of the pressure the debt crisis has put the euro zone banking system.
http://jlne.ws/qjTuLj

World Bank's Zoellick: World economy in new danger zone
Reuters
The head of the World Bank said Wednesday the world had entered a new economic danger zone and that Europe, Japan and the United States all need to make hard decisions to avoid dragging down the global economy.
http://jlne.ws/owt3gK

Mack to step down as Morgan Stanley chairman
By William Spain, MarketWatch
John Mack will step down from his position as chairman of investment bank Morgan Stanley at the end of this year, the company said Thursday. Mack, who also plans to retire from his full-time slot, will remain as a senior adviser.
http://jlne.ws/nxKIHn

Rate on 30-year mortgage falls to record 4.09 pct.
Associated Press
Fixed mortgage rates fell to the lowest level in six decades for the second straight week. But few Americans can take advantage of the historically low rates.
http://jlne.ws/nLwZCs

Auction Draws Record Low Yield
By Susanne Walker and Cordell Eddings, Bloomberg Businessweek
The Treasury sold $13 billion of 30-year securities at a record low yield as investors bet the Federal Reserve will buy more bonds.
http://jlne.ws/qz13GJ

Rogue trader causes $2 billion loss at UBS
LA Times
Swiss banking giant UBS said Thursday that a rogue trader has caused it an estimated loss of $2 billion, stunning a beleaguered banking industry that has proven vulnerable to unauthorized trades.
http://jlne.ws/qogGnn

KC Fed names Esther George as president
By MARK DAVIS, The Kansas City Star
The Federal Reserve Bank of Kansas City has named Esther George, its first vice president, to be its president and the region’s voice on monetary policy.
http://jlne.ws/qS2lvv

Geithner: Jobs Plan Can Work 'Very Quickly'
By JEFFREY SPARSHOTT, WSJ.com
WASHINGTON—Treasury Secretary Timothy Geithner said Friday the Obama administration's proposed jobs package could work "very, very quickly" to boost the economy and ultimately generate hundreds of thousands of new jobs.
http://jlne.ws/nVNNef

Geithner Says Europe Committed to Avoid a 'Lehman Brothers'
BusinessWeek
U.S. Treasury Secretary Timothy F. Geithner said "there is no chance that the major countries of Europe will let their institutions be at risk in the eyes of the market."
http://jlne.ws/qowYCb

Tim Geithner, Who Has Never Been Wrong About Anything, Rallies Markets
Wall Street Journal Blogs
So apparently CNBC aired an interview with Tim Geithner this morning, in which the Treasury Secretary told Jim Cramer there is "no chance" of a Lehman-like event happening in Europe.
http://jlne.ws/rrQbXf

Why You Shouldn't Believe Tim Geithner When He Says There Won't Be A Lehman In Europe
Business Insider
One of the big headlines from Tim Geithner's CNBC interview was his comment about how Europe won't have a Lehman Brothers.
http://jlne.ws/oh7mg7

Treasury Awards $608M in Small Business Funds
American Banker
Sixty-one small banks will receive a total of $608 million in the latest round of funding from the Small Business Lending Fund, the Treasury Department said Wednesday.
http://jlne.ws/qXse1r

A Tale of Two Speeches
Marc Chandler BBH CurrencyView
A tumultuous market environment continues to support the US dollar. Equity markets remain pressured at the end of a tumultuous weak after the unchanged ECB and BoE decisions and the Obama and Bernanke speeches allconfirmed a weaker global backdrop but failed short of backstopping market cyclical and structural concerns.
http://jlne.ws/nFBtHB

Obama Asks Congress for $447 Billion In Cuts, Spending; Tepid GOP Response
WSJ.com
President Barack Obama called on Congress Thursday to pass a $447 billion package of spending initiatives and tax cuts to boost economic growth, in what might be the White House's last chance to revive its political fortunes before the 2012 campaign kicks into high gear.
http://jlne.ws/qeoGXS

Obama speech recognizes hurdles for first time: Pimco's El-Erian
InvestmentNews
Pacific Investment Management Co.'s Mohamed El-Erian said President Barack Obama is moving for the first time to “get ahead” of U.S. economic challenges because the Federal Reserve is unable to revive employment on its own.
http://jlne.ws/pD5rQw

Experts back expanding Obama mortgage refi effort
By Ronald D. Orol, MarketWatch
A group of academics and analysts on Wednesday urged the Obama administration to expand an existing program that seeks to refinance mortgages to lower interest rates.
http://jlne.ws/ptNVYC

China Willing to Buy Bonds From Crisis Nations
Bloomberg
China is willing to buy bonds from nations involved in the sovereign debt crisis, National Development and Reform Commission Vice Chairman Zhang Xiaoqiang said in an interview with the media in Dalian yesterday.
http://jlne.ws/pxxcay

Give-up agreement can survive CFTC attack, Isda event told
Duncan Wood - Risk magazine
Despite a CFTC proposal that attacks an industry clearing document, the core of the text can survive, says lawyer at Isda's New York conference An industry attempt to develop standard documentation for cleared over-the-counter derivatives trades may have been slapped down by the Commodity Futures Trading Commission (CFTC) in a proposed rule-making on July 19, but those involved in the project aren't giving up on it yet.
http://jlne.ws/mRGBd3

Greenspan Questions Benefits Of Fed Treasury Note Purchases
WSJ.com
Former U.S. Federal Reserve Chairman Alan Greenspan questioned Friday whether ideas being floated to stimulate the U.S. economy, such as Fed purchases of Treasurys, would have much impact. Speaking in Mexico City, Greenspan said it's "unclear at this stage" whether a so-called "Operation Twist"--in which the Fed would replace short-dated paper with longer-term securities to push down interest rates over the long term--would work.
http://jlne.ws/mXOnvN

Supercommittee Open to Finding Extra Savings to Pay for Parts of Jobs Plan
By Jeffrey Sparshott and Corey Boles, WSJ.com
Lawmakers on the debt supercommittee say they are open to finding more long-term savings that could be put toward immediate measures to spur job growth, though such a move would complicate an already difficult task with a tight deadline.
http://jlne.ws/ofpGDa

IMF: More Clarity in Central Banks’ Inflation Targets Would Help
By Ian Talley, The Wall Street Journal
Amid high global food and fuel prices threatening to derail monetary-policy plans, central banks need to clearly identify and communicate their inflation targets or risk undermining their credibility in the markets, the International Monetary Fund said in a new report Wednesday.
http://jlne.ws/qNOyJC

Moody's cuts French banks, eurobond talk lifts markets
By John O'Donnell, Reuters
European finance ministers have been warned confidentially of the danger of a renewed credit crunch as a "systemic" crisis in euro zone sovereign debt spills over to banks, according to documents obtained by Reuters on Wednesday.
http://jlne.ws/nvPUWP

ISDA’s Voldstad Says Only Banks Should Have to Clear Swaps
By Matthew Leising, Bloomberg
Conrad Voldstad, chief executive officer of the International Swaps and Derivatives Association, said only banks should be made to process swaps with clearinghouses.
http://jlne.ws/pwvS7E

ISDA and S&P Indices to Co-brand S&P Credit Default Swap Indices
NEW YORK, Tuesday, September 13, 2011 – The International Swaps and Derivatives Association, Inc. (ISDA) and S&P Indices announced today that they will co-brand S&P’s existing Credit Default Swap (CDS) Indices as S&P/ISDA CDS Indices. The S&P/ISDA CDS Indices seek to reflect the credit default swap market for U.S. corporate credits and increase transparency for market participants

Dallas Fed President: “Uncertainty” Is Hurting the Economy, Not Fed Policy
By Stacy Curtin, Yahoo! Finance
Dallas Fed President Richard Fisher says uncertainty, not Fed policy, is hampering the U.S. and global economy. This uncertainty is twofold, he said during a speech before the National Association for Economists on Monday. It stems from the wild display of dysfunction among our elected officials in Washington over the debt ceiling debacle and from the sovereign debt crisis that has spread across Europe with no real end or viable solution site. (See: Europe's Crisis Grows As Governments Refuse To Offer Real Solutions)
http://jlne.ws/oDAGgX

FIA - Remembering 9/11: The Impact on the Futures Industry
Futures Industry Association
http://jlne.ws/peWu6A

Fed Scrutinizes Capital One-ING Deal
BY VICTORIA MCGRANE AND MAYA JACKSON RANDALL, WSJ.com
The Federal Reserve asked Capital One Financial Corp. to respond to questions that appear aimed at determining whether the proposed acquisition of ING Groep NV's U.S. online-banking business would create a bank so large and complex that its failure would pose a risk to the financial system.
http://jlne.ws/p2GFB0



Events

FIA Treasury And Rates Forum
Sept. 14, 2011
FIA Program On Growing Role Of Treasury Futures - New York City
http://jlne.ws/fQFQXP

SEFCON II
Oct. 3, 2011
WMBAA To Examine Role And Operation Of Swap Execution Facilities Under Dodd-Frank
http://jlne.ws/pY4N7S

** CN: MarketsReformWiki's Doug Ashburn will be attending this event.


MarketsWiki Questions: Exploring Financial Technology
October 5, 2011, 4:30 p.m. - 6 p.m., IIT Stuart School of Business
http://jlne.ws/oHRGmC

7th Annual FIA Asia Derivatives Conference
November 29 - December 1, 2011
FIA looks at the futures and options industry in Asia
http://www.futuresindustry.org/asia-2011.asp





Economic News

Report: Housing Inventory Hits 2011 Low
By Nick Timiraos. WSJ.com
Housing inventory dropped for the fourth straight month, falling in August to the lowest level of the year.
http://jlne.ws/nRaHLw

Chances of another recession increasing
By Leah Schnurr, Reuters
Chances the United States will lapse into another recession rose over the past month to nearly one in three as the economy faces a number of road blocks that could derail already weak growth, a Reuters poll showed on Wednesday.
http://jlne.ws/rogB9u

US Business Inventories up 0.4% in July
FX Street
http://jlne.ws/pEQyqf

Census: US poverty rate swells to nearly 1 in 6
Hope Yen, Associated Press
The ranks of the nation's poor have swelled to a record 46.2 million -- nearly 1 in 6 Americans -- as the prolonged pain of the recession leaves millions still struggling and out of work. And the number without health insurance has reached 49.9 million, the most in over two decades.
http://jlne.ws/oLPPqc

Low interest rates don’t help sputtering economy
By Brian Edmonds, Marketwatch
Last month will go down in the history books as one of the most volatile on record for world financial markets. Treasurys had their largest rally since 2008, equities gyrated wildly and gold continued its surge to new record highs as the global anti-currency.
http://jlne.ws/n6QkQc

U.S. Economic Weakness Masked By Consumer Credit
Seeking Alpha
The financial news about U.S. consumer credit, a report published by the Federal Reserve, is missing the core reading of the data, and the recent conclusion has been that consumers are borrowing heavily. The implication is that economic bad times will have to wait, and I wish that was true.
http://jlne.ws/qn1HMG

New York manufacturing activity dips again
By Greg Robb, MarketWatch
Manufacturing activity in the New York region weakened again in September, according to data released Thursday, raising fresh concern over the strength of the factory sector in the third quarter.
http://jlne.ws/oNaPms

FRBSF: Expect Cont'd Sluggish Growth For Several Quarters, More Normal Recovery Pace In '13 And Beyond
Federal Reserve Bank Of San Francisco
Revisions to second-quarter GDP showed that the U.S. economy grew at a 1% rate, down from the initial estimate of 1.3% reported in July. The change was more than accounted for by downward revisions to net exports and inventories, which tend to be volatile from one quarter to the next.
http://jlne.ws/rm7Omi



Exchanges, Clearing Houses & MTFs
DTCC Announces Initiative To Revamp Processing of Continuous Net Settlement Obligations
Press Release
The Depository Trust & Clearing Corporation (DTCC) has proposed changing the way its clearing agency subsidiaries, The Depository Trust Company (DTC) and National Securities Clearing Corporation (NSCC), process Continuous Net Settlement (CNS) transactions. The enhanced process would align CNS processing into the risk management control structure used by DTC to reduce risk and boost liquidity efficiencies in the settlement of almost $870 billion in equities that trade in the U.S. markets each day.
http://jlne.ws/qtsTXj
.
Concerns in Europe send exchange shares lower
By The Associated Press
Shares of stock exchange operators fell Friday as worries over Europe's handling of its debt crisis and a further deterioration in its economy led to a stock sell-off.
http://jlne.ws/qkGWnk

NYSE Liffe, ICE Move Toward Transparency
BY CAROLINE HENSHAW AND LESLIE JOSEPHS, WSJ.com
Two exchanges that dominate trading in commodities from cocoa to sugar yielded to calls for greater transparency in their markets. On Tuesday, IntercontinentalExchange Inc. tightened its rules for coffee samplers, while NYSE Liffe introduced plans for two reports on trading positions.
http://jlne.ws/pUqmPG




Firms & Banks

Banks Took $6B in Reinsurance Kickbacks, Investigators Say
By Jeff Horwitz, National Mortgage News
Many of the country's largest banks received $6 billion in kickbacks from mortgage insurers over the course of a decade, according to a previously undisclosed investigation by the Inspector General of the Department of Housing and Urban Development.
http://jlne.ws/pKDzm4

Private banks struggle in region of rich pickings
By Kevin Brown in Singapore - Financial Times
Sir Richard Branson, the UK entrepreneur, once quipped that the best way to become a millionaire was to be a billionaire and start an airline. In emerging Asia, it is beginning to look as though something similar might be said of private banking.
http://jlne.ws/nGw7kU

Goldman Sachs to offer $25M to Chicago businesses
Chicago Tribune
Goldman Sachs is funneling $25 million in loans and educational grants to Chicago-area small businesses, Mayor Rahm Emanuel announced Tuesday.
http://jlne.ws/nHJbuF

MarketAxess weighs in to MiFID II debate
Press Release
MarketAxess Holdings Inc. (Nasdaq; MKTX), the operator of a leading electronic trading platform for U.S. and European high-grade corporate bonds, emerging markets bonds and other fixed income securities, reiterates its views on the range of proposals outlined in the Markets in Financial Instruments Directive II (MiFID II), which is scheduled to be finalized in October.
http://jlne.ws/qnVwIN

Fidelity Names Feingold to Run Magellan Fund
By Christopher Condon and Charles Stein, Bloomberg
Fidelity Investments named Jeffrey S. Feingold to run the $17.4 billion Magellan Fund, replacing Harry Lange who oversaw a two-thirds decline in assets in what was once the largest U.S. mutual fund.
http://jlne.ws/nbXNKw

JPMorgan chief says bank rules ‘anti-US’
By Tom Braithwaite and Patrick Jenkins, FT.com
http://jlne.ws/nEMCVc

Woes at French Banks Signal a Broader Crisis
BY DAVID GAUTHIER-VILLARS AND NATHALIE BOSCHAT, WSJ.com
France's largest private-sector banks will likely suffer further credit-rating downgrades this week, people familiar with the matter said, the latest sign that the debt crisis on the euro zone's periphery is slowly infecting the core of the region's financial system.
http://jlne.ws/qeEFfu

Bank of America to Cut Costs $5 Billion A Year
By Hugh Son, Dawn Kopecki and Max Abelson, Bloomberg
Bank of America Corp. (BAC), the biggest U.S. lender by assets, expects to cut about $5 billion in costs annually by 2013 under Chief Executive Officer Brian T. Moynihan’s plan to bolster profit and the company’s stock.
http://jlne.ws/qLpQ4J

Europe Stress Seen in French Bank Commercial Paper Rates: Credit Markets
By Matthew Leising, Bloomberg
Societe Generale SA, BNP Paribas SA and Credit Agricole SA (ACA) are being quoted higher rates than their competitors in the commercial paper market as the crisis in the euro zone spreads beyond Greece, Portugal and Italy.
http://jlne.ws/qDKi2P

Goldman Sachs Names Avanessians to Run Quant Funds, Hires Hua
Bloomberg
Goldman Sachs Group Inc. (GS) , the fifth-biggest U.S. bank by assets, said new managers will run the quantitative funds unit and that Katinka Domotorffy is retiring after 13 years at the firm.
http://jlne.ws/qko65h

Citi Relocates A$ Credit Trading To Sydney From Hong Kong
Dow Jones
SYDNEY -(Dow Jones)- Citigroup Inc.'s (C) Citi unit is relocating its Australian dollar credit trading desk from Hong Kong to Sydney and has created a new head of G-10 rate strategy for the Asia-Pacific region based in Sydney, the U.S. bank said Thursday.
http://jlne.ws/nh7OfU




Auctions & Statistics

10-Year Auction Produces Record Low Yield
By Daniel Kruger and Susanne Walker, Bloomberg Businessweek
Treasuries dropped as the government sold $21 billion in 10-year notes at a record low yield and concern eased that Europe’s debt crisis may cripple the region’s financial institutions.
http://jlne.ws/nmoUMi

Italian Bond Auction Spells More Trouble
BY EMESE BARTHA AND NEELABH CHATURVEDI, WSJ.com
Troubles increased for Italy after its closely watched auction of government bonds met with tepid demand and the country had to fork out higher yields to lure buyers, fueling concerns that a Spanish bond sale on Thursday may also prove to be a tough sell.
http://jlne.ws/piwgv8

Italian Borrowing Costs Jump at $8.8B Auction
By Jeffrey Donovan and Lorenzo Totaro, Bloomberg
Italian borrowing costs jumped at a 6.5 billion-euro ($8.8 billion) bond auction as contagion from Europe’s debt crisis leaves investors shunning the region’s most-indebted nations.
http://jlne.ws/rlwmoF

Treasury to Sell $11B 10-Year TIPs
The Bond Buyer
The Treasury Department said it will auction $11 billion 9-year 10-month inflation-protected notes on Thursday, September 22.
http://jlne.ws/raARZB






Regulators

Bullard Says Fed Can Use ‘Balance Sheet Policy’ to Add Momentum to Economy
By Greg Quinn, Bloomberg
St. Louis Federal Reserve President James Bullard said policy makers need to consider if further stimulus is needed after the U.S. economy slowed in the last few months.
http://jlne.ws/qaMqb6

CFTC member warns US cannot be ‘financial policeman’
By Telis Demos and Michael Mackenzie, FT.com
http://jlne.ws/qyUQmN

U.S. Can’t Sustain Spending and Tax Levels, CBO Head Says
Bloomberg
Congress would have to more than double its $1.5 trillion deficit-cutting goal to diminish the risk of a fiscal crisis and reduce the debt burden on the economy, the director of the nonpartisan Congressional Budget Office said.
http://jlne.ws/qNebhz

German financial authority approves Deutsche Börse - NYSE merger
Press Release
Germany’s Federal Financial Supervisory Authority (BaFin) has approved the merger of Deutsche Börse and NYSE Euronext. With BaFin’s decision, the merger has reached an important regulatory milestone in Germany. The BaFin examination is comparable to the shareholder control procedure by the stock exchange regulators. It concerns a significant acquisition of shares in the banks and financial services institutions of the Deutsche Börse Group by the parent company of the new group (Holdco) headquartered in the Netherlands, and the permissibility of this acquisition. This particularly includes Clearstream Banking AG as the central settlement institution for securities transactions, and Eurex Clearing AG as the central counterparty for the derivatives exchange Eurex.
http://jlne.ws/pqXEtt




Global News

S.Korea's swap market reflects deep concerns over Europe's fiscal crisis
By Yoo Seungki, Xinhuanet
South Korea's cross-currency swap market plunged on Wednesday as investors took hefty receiving positions in the market due to deepening concerns over the possible Greek default and the potential credit crunch of the European banks.
http://jlne.ws/nplSR1

Germany and France Back Greece on Austerity Effort
By STEVEN ERLANGER and NICHOLAS KULISH, NY Times
PARIS — The Greek prime minister vowed Wednesday to persevere with austere cuts in the struggling country’s budget, while the leaders of France and Germany promised to support Greece’s continued membership in the euro zone.
http://jlne.ws/rnW4Yr

Greece ‘integral’ to euro zone, leaders say
The Globe And Mail
Greece is an “integral” part of the euro zone, the leaders of Greece, France and Germany said in an emergency teleconference Wednesday night that aimed to calm markets and temper talk of an imminent default by Greece.
http://jlne.ws/q4vcbF

Barroso urges eurozone to act on reforms
By Kerin Hope in Athens and Joshua Chaffin, FT.com
http://jlne.ws/pe7u67

Japan's new PM vows reconstruction, economic recovery
Kuna
Japanese Prime Minister Yoshihiko Noda on Tuesday said his government will prioritize recovery and reconstruction of areas devastated by the March earthquake and tsunami, and dealing with the global economic crisis.
http://jlne.ws/o8Bikq

China willing to expand investments in Europe
MarketWatch
China views Europe as a strategic partner and stands willing to expand its investments in the region, Premier Wen Jiabao said Wednesday, urging that Europe acknowledge China’s status as a market economy.
http://jlne.ws/nEusFu

Italian Lower House Passes in Austerity Package
By GAIA PIANIGIANI, The New York Times
Prime Minister Silvio Berlusconi’s government won a confidence vote on Wednesday that paves the way for final approval of a $74 billion austerity plan to help keep Italy from being ensnared in Europe’s debt crisis.
http://jlne.ws/oUHL2f

Britain to sue ECB over threat to City
By Alex Barker in Wroclaw and George Parker and Jeremy Grant, FT.com
Britain is to sue the European Central Bank for setting rules that allegedly handicap the City of London and would force one of the world’s largest clearing houses to decamp operations to the euro area. The unprecedented legal action underlines the depth of ministerial concern over the ECB policy, which comes as the UK engages in a turf war with France and Germany over Europe’s financial markets infrastructure.
http://jlne.ws/naP1Qy

Australian Foreign Minister Kevin Rudd Warns on Protectionism
By ENDA CURRAN And ANDREW CRITCHLOW, WSJ.com
Australian Foreign Minister Kevin Rudd warned Wednesday against the world slipping toward protectionist trade policies in response to the European debt crisis and dramatic fluctuations in currency markets that are adding to global uncertainty.
http://jlne.ws/rmxkG8

Greek collateral issue no longer explosive: Austria
By Michael Shields, Reuters
A euro zone row over collateral to back loans to Greece has lost its "explosive" power under a plan that would let every member country decide for itself whether to make use of the facility, Austrian Finance Minister Maria Fekter told Reuters.
http://jlne.ws/o5HRig

Wen: World Must Cut Deficits, Not Rely on China
Bloomberg
Chinese Premier Wen Jiabao, facing calls to widen support for indebted European countries, signaled that developed nations should cut deficits and open markets rather than rely on China to bail out the world economy.
http://jlne.ws/nDIkPP

EU's Barroso: Will present options on euro bonds
By Gilbert Reilhac, Reuters
The European Commission will soon present options on how the euro zone might issue bonds jointly, its President Jose Manuel Barroso said on Wednesday, but warned there was no simple solution to a debt crisis that threatens Europe's economic and political future.
http://jlne.ws/qzyMNg

Swiss tax deals with Germany and Britain complicate tax negotiations inside EU
SwissInfo
The bilateral tax agreements concluded by Switzerland in August with Germany and Britain have become a bone of contention in the European Union.
http://jlne.ws/nlAVVO

Nomura plans European staff cuts
By Jonathan Soble, Financial Times
Nomura plans to lay off about five per cent of its staff in Europe, or between 250 and 300 people, as part of an effort to reduce costs and restore profitability, according to a person briefed on the matter.
http://jlne.ws/pkPEq2

Merkel Quells Speculation on Greek Default
BY MARCUS WALKER AND NOÉMIE BISSERBE, WSJ.com
German Chancellor Angela Merkel sought to quash talk that cash-strapped Greece might have to declare bankruptcy soon or even leave the euro zone, rebuking her junior coalition partner for fueling market speculation about Greece's fate.
http://jlne.ws/qHNk5N

Critics of Italian Austerity Plan Find Rallying Point
By ELISABETTA POVOLEDO, The New York Times
In the persistently quarrelsome climate that marks Italian politics, bipartisan agreement tends to be the exception rather than the rule. Unless, it turns out, a city’s patron saint is concerned.
http://jlne.ws/pxJilD

Italy in talks with China on bonds: BBG
By Jamie Coleman, Forex Live
A quick pop from the 1.3570s to 1.3624 on a Bloomberg headline that Italy is in talks with China’s sovereign wealth fund to buy Italian bonds. China’s been buying this crap for more than a year…why the market would expect miracles in beyond me…They’ve got Greek debt out the ying-yang…(is that a Chinese term? Yes, it means bought to soon).
http://jlne.ws/okjgcI

Germany’s Schaeuble: Must be prepared for everything
By Jamie Coleman, FX Street
Regarding Greek insolvency, says government has to consider all eventualities EUR/USD sliding again, now at 1.3575.
http://jlne.ws/qIjxQ0

Stress levels high on euro zone, Greek troubles
By Ana Nicolaci da Costa, Reuters
A key measure of financial stress hit its widest level in more than two years on Friday as challenges for the euro zone mounted and with investors expecting little from a Group of Seven financial summit.
http://jlne.ws/nxOlDE4

UK joins toughest bank regimes
By Brooke Masters, James Wilson and Matthew Steinglass, FT.com
http://jlne.ws/nuK1B3




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