Daily Collateral's blog

Daily Collateral's picture

Citi's Buiter: Greece will be forced out of the euro regardless of who wins the Sunday elections





Greece is on its way to becoming a "new, critical fragile state," and the ECB and EU will have to keep it on life support for years after it exits the common currency.

 
Daily Collateral's picture

Morgan Stanley, coming to the funnies section of a newspaper near you





Morgan Stanley's *hilarious* comic strip on our *hilarious* credit markets.

 
Daily Collateral's picture

SocGen: US is "daring the rest of the world to sell the dollar"





Société Générale head of foreign exchange research Kit Juckes on the US dollar dynamic, QE 3, 4, and 5, "even lower rates for even longer than you thought," and the Bank of Japan slowly learning to match policies with the Fed.

 
Daily Collateral's picture

On war in Europe





"Even on the eve of war, however, there was still considerable optimism that the peace would hold. Europe had experienced several decades without a major war, and in the meantime, industrialization and relatively free international trade had produced rapidly rising standards of living. A war that would destroy the fruits of this progress seemed irrational.

 

 
Daily Collateral's picture

SocGen: Tuesday's FOMC was "as good as it gets" for QE3 hopefuls





"Rationalising away the imminent risk of inflation, the Fed leaves the door wide open for a QE3 announcement in April."

 
Daily Collateral's picture

Kit Juckes: The USA's gentlemen's agreement with Japan and China is coming to an end





Looks like it's time to start looking for somewhere else to peddle those Treasuries -- but then, when hasn't it been?

 
Daily Collateral's picture

Albert Edwards: JPY devaluation exacerbates risk of China hard landing, drags them into currency war





"We are a hair's breadth or, more exactly, one recession away from a market panic on outright deflation -- a panic that will send the central banks into a printing frenzy that will make their balance sheet expansion so far seem like a warm-up act for the main show." Albert Edwards

 
Daily Collateral's picture

A word from Barclays on LTRO subordination of senior unsecured debt in the Euro bank funding market





The European Central Bank's recent LTRO programs have effected a significant increase in the amount of encumbered assets -- those pledged as collateral in repo transactions, central bank funding operations, and covered bond issuance as lenders increasingly demand over-collateralized borrowing arrangements to protect against credit risk -- on balance sheets across the pan-European banking system.

 
Daily Collateral's picture

Fed economists slam TARP (LTRO?) in a paper measuring the rescue fund's effect on risk-taking at TBTFs





Paging the eurozone: Coercing banks to lend into a recession didn't work here in 2008. It made things worse.

 
Daily Collateral's picture

BIS: Clearing CDS through a CCP could cost “G14 dealers” $100B in margin requirements





The BIS published a working paper estimating the costs of moving off-balance sheet derivatives trading to central exchanges in terms of daily margin requirements could be, for a dealer like Deutsche Bank, upwards of $8B, and for JPMorgan, $5B in times of volatility. The cost to the biggest 14 swaps dealers in terms of initial margins? Over $100B.

 
Daily Collateral's picture

Probability Map: Morgan Stanley's Vincent Reinhart still says 75% chance of Fed QE3 by June





Newsflash: the Fed controls the economy. It's working on financial markets. Former Fed official and Treasury put-master Vincent Reinhart, who is now the chief U.S. economist at Morgan Stanley, says the only way QE3 doesn't happen is "if the economy surges or equity investors continue to embrace risk," in which case "the Fed would cheerfully keep its plans on the shelf." The only problem is it looks like we just had the "surge" and it didn't seem to impress the Federal Reserve, and every time they try to exit a buying program, the market tanks.

 
Daily Collateral's picture

Wall Street’s weekend LTRO conversation: Stealth sovereign bailouts





Analysts are questioning the "double-down effect" the ECB's LTRO exercises are creating in eurozone sovereign spreads. Citi notes a spike in the purchase of government securities since the initial take-up in December.

 
Syndicate content
Do NOT follow this link or you will be banned from the site!