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• Bundesbank Maintains Opposition to ECB Bond Buying (WSJ)
• Greek Budget Talks Stumble as EU Urges Samaras to Deliver (Bloomberg)
• Fortified by euro, Finns take bailouts on the chin (Reuters)
• China Job Market for Graduates Shows Stress on Slowdown (Bloomberg)
• China Exports Fade as Inflation Eludes Targets: Cutting Research (Bloomberg)
• Japan Falters as Ito Calls for Euro Buys to Rein in Yen: Economy (Bloomberg)
• Government weighs social insurance reforms (China Daily)
• Colombia’s Split Central Bank to Weigh First Rate Cut Since 2010 (Bloomberg)

Will the Fed then just keep printing forever and ever? As an aside, financial markets are already trained to adjust their expectations regarding central bank policy according to their perceptions about economic conditions. There is a feedback loop between central bank policy and market behavior. This can easily be seen in the behavior of the US stock market: recent evidence of economic conditions worsening at a fairly fast pace has not led to a big decline in stock prices, as people already speculate on the next 'QE' type bailout. This strategy is of course self-defeating, as it is politically difficult for the Fed to justify more money printing while the stock market remains at a lofty level. Of course the stock market's level is officially not part of the Fed's mandate, but the central bank clearly keeps a close eye on market conditions. Besides, the 'success' of 'QE2' according to Ben Bernanke was inter alia proved by a big rally in stocks. But what does printing money do? And how does the self-defeating idea of perpetual QE fit with the Credit Cycle relative to Government Directed Inflation (or inability to direct inflation where they want it in the case of the ECB and BoE)?

• ECB's Nowotny - ESM banking license could be advantageous (Reuters) - just keep regurgitating headlines until they generate a short squeeze
• IMF Says China Downside Risks Significant as Growth Slows (Bloomberg)
• Moody's cuts outlook on EU stability facility to negative (Reuters)
• Rome places spending controls on Sicily (FT)
• Big banks' glory days feared to be gone for good (Reuters)
• China's CNOOC scoped Nexen, partnered, then pounced (Reuters)
• Germany backs Spanish austerity plans (FT)
• Are 2012 Games one too many for London? (Reuters)
• Euro Crisis Spreading East Damps Growth, Development Bank Says (Bloomberg)
• Japan Flags Yen-Sales Impact as BOJ Eyes More Easing (Bloomberg)

1000s of Apple luvin', disrespectful fanbois should be rushing to apologize to the BoomBustBlog editor for failure to recognize true fundamental analysis in the face of chasing leveraged beta. Unfortunately, it just won't happen...

There was a time when regulators caught red-handed abusing their privileges, aka, doing nothing in the face of glaring malfeasance, would quietly fade away only to even more quietly reappear, sans press release, as a third general counsel or some other C-grade menial role paying a minimum 6 figure compensation to the individual for years of doing nothing. This is no longer the case: it appears that the best such exposed "regulators" can hope for going forward is to get media positions. Such is the case with John Ewan. Who is John Ewan? None other than the director "responsible for the management of the setting of Libor" at the British Bankers' Association. In other words, the man whom The Sun of all non-captured publications (oddly enough, tabloids sometimes have more journalistic integrity than Reuters and the FT as we will shortly find) has dubbed Mr. Libor. The Sun continues: "In a staggering profile on the internet Mr Ewan reveals he joined the BBA in 2005 to “put Libor on a secure commercial footing”. That year Barclays traders began fiddling the figures they submitted for the Libor calculations. On the LinkedIn networking site Mr Ewan boasts of generating a “tenfold” increase in revenue from licensing out the Libor rate." He adds: “I introduced new products and obtained EU, US and Japanese trademarks for BBA Libor. "I successfully negotiated contracts with derivatives exchanges and all of the major data vendors." Well, in the aftermath of Lieborgate surely Ewan is going to someone receptive to his permissive and highly profitable tactics over the years, such as Barclays. Actually no: instead of a bank, the only place that is willing to accept Ewan is media conglomerate Reuters. And not just as anyone: "Thomson Reuters confirmed that Ewan has joined the company as head of business development for its fixing and benchmark business." We wonder how much revenue Mr. Ewan generated for Reuters?

Visitor volume to Las Vegas is the highest since 2007, despite rising hotel rates, but gaming revenues are near flat.  Online gambling is popular with Europeans – the Brits and Greeks in particular – yet it has slowed over the past 3 months. ConvergEx's latest off-the-beaten-path economic indicator – gambling – shows an increasing global reluctance to leave household finances at the whims of blackjack and poker tables, be they in actual casinos or online betting parlors. Discretionary spending behavior is reliant on consumer sentiment and economic outlook; gambling is the ultimate “luxury item” because there’s absolutely no guaranteed return, so gambling behavior is a near real-time indicator of changes in consumer confidence.  Our gambling indicators, both domestic and abroad, show what feels a lot like recessionary behavior and point to another leg down in the latter half of 2012.

The effect on the USA of its casually wandering over the Fiscal Cliff will be catastrophic; adding approximately $607bln to the US deficit which in turn would sap anywhere up to 4% (according to the CBO) or possibly even 5% (if Chairman Bernanke—in full-on ‘scare Congress’ mode—is to be believed) from US GDP and send the country crashing into outright recession (or further into recession depending on how things continue to deteriorate in the coming months). “That we cannot have” was the opinion of Erskine Bowles who, along with former Sen. Alan Simpson, devised a debt reduction plan last year to prevent this doomsday scenario.... According to the OMB estimates, any attempt to do something remotely meaningful will result in at least a percentage point reduction in US GDP, which is fine in a world of 3% growth, but today that 1% is not something these guys have to play around with. In the run-up to December 31, you can guarantee that the issue of the US Fiscal Cliff will replace Europe as the major concern facing the world in general and the US in particular and, if things continue to deteriorate at their current pace, anything that will lead to even a 0.5% cut inGDP will be seen as a  disaster.

Last week when we wrote about the imminent default of Sicily which Mario Monti tried to sweep under the rug by demanding the local governor resign for not masking the situation with lies, and doing all he can to prevent the advent of reality, we noted, rather sarcastically, that the "resignation of Sicily Governor Lombardo will somehow allow all those who care about the fundamentals of Italy to stick their heads in the sand... at least until Sicily is followed by Calabria, Campania, Lazio, Abruzzo, Tuscany, Lombardy, Umbria, Liguria, Veneto and so on. At least the governors of those respective provinces now have an advance warning what the endgame is." Sure enough, now that this particular floodgate has also been opened, it is only fitting that in the aftermath of this weekend's main news that a total of 6 Spanish regions will demand bailouts, that Italy follow suit with its own blacklist, and as La Stampa has reported, there are now ten major Italian cities at risk of an imminent financial collapse, yet another factor pushing Italian yields well on their way to the country's own 7% rubicon, now at 6.34%.

• Greece should pay wages in drachmas - German MP (Reuters)
• Greece Seeks More Cuts as Deadlines Loom (WSJ)
• Greece Back at Center of Euro Crisis as Exit Talk Resurfaces (Bloomberg)
• Berlusconi seeks return to liberal roots (FT)
• For brokers like Peregrine, from bad times to worse (Reuters)
• Japan Sees More ‘Widespread’ Global Slowdown With China Cooling (Bloomberg)
• China Central Bank Adviser Forecasts Growth Slowdown to 7.4% (Bloomberg)
• London Out to Prove It's Still in the Game (WSJ)
• Stockton Reveals Bondholder Offers From Mediation (Bloomberg)
• US lawmakers propose greater SEC powers (FT)

With Valencia bust, Spanish bonds at all-time record spreads to bunds, and yields at euro-era record highs, Spain's access to public markets for more debt is as good as closed. What is most concerning however, as FAZ reports, is that "the money will last [only] until September", and "Spain has no 'Plan B". Yesterday's market meltdown - especially at the front-end of the Spanish curve - is now being dubbed 'Black Friday' and the desperation is clear among the Spanish elite. Jose Manuel Garcia-Margallo (JMGM) attacked the ECB for their inaction in the SMP (bond-buying program) as they do "nothing to stop the fire of the [Spanish] government debt" and when asked how he saw the future of the European Union, he replied that it could "not go on much longer." The riots protest rallies continue to gather pace as Black Friday saw the gravely concerned union-leaders (facing worrying austerity) calling for a second general strike (yeah - that will help) as they warn of a 'hot autumn'. It appears Spain has skipped 'worse' and gone from bad to worst as they work "to ensure that financial liabilities do not poison the national debt" - a little late we hesitate to point out.

• Gunman kills 14 in Denver shooting at "Batman" movie (Reuters)
• Full retard meets Math for Retards: Spain Insists $15 Billion Aid Need for Regions Won’t Swell Debt (Bloomberg)
• World braced for new food crisis (FT)
• Banks in Libor probe consider group settlement (Reuters)
• U.S. banks haunted by mortgage demons that won't go away (Reuters)
• Ireland Bulldozes Ghost Estate in Life After Real Estate Bubble (Bloomberg)
• China will not relax property control policies (China Daily)
• Russia, China veto U.N. Security Council resolution on Syria (Reuters)
• Kim to reform North Korean economy after purge (Reuters)

In the eyes of our most decorated ‘scientists’, the brilliance and guile of Ingvar Kamprad, Sam Walton, Ray Kroc, Asa Candler, Richard Branson, Steve Jobs, and millions of others are far less important than an effective government bureaucracy. His entire book, in fact, is an impassioned argument for even more government control and redistribution of wealth. Right… because it’s been working so well. These ideas are totally absurd. Yet this what passes as science today. And because it’s science, society simply believes it to be true. No doubt, people in the future will look back, and they’ll wonder… but they won’t understand one bit.

• Lieborgate fallout: Bank of England Governor Sir Mervyn King faces MPs (Telegraph)
• Yahoo's brand new CEO to seek maternity leave shortly (NYT)
• China’s Foreign Investment Drops 6.9% In June (Bloomberg)
• Falling property investment drives China H1 FDI drop (Reuters)
• German Court Delays Ruling on Fund (WSJ)
• Fed's George Says U.S. Growth May Not Exceed 2% in 2012 (Bloomberg)
• China Echoes 2009 Stimulus Planned Railway Spending Boost (Bloomberg)
• ZEW: Investor Outlook For German Econ At Six-Month Low (MNI)
• Fed Shifts Focus To Jobs As Unemployment Stalls Above 8% (Bloomberg)
• Goldman Builds Private Bank (WSJ) - lock in those deposits asap
• UniCredit, Intesa Among 13 Italian Banks Cut By Moody’s (Bloomberg)

Former Google employee Marissa Mayer is now Yahoo's CEO. Good luck to the longs and Dan Loeb. In the meantime, hear (sic) she is. In the meantime, those who like us, were a little confused, this is all you need to know.

• Looks like the troops won't be steamrolled: JPMorgan Blaming Marks On Traders Baffles Ex-Employees (Bloomberg)
• The Goldman "Huddle" goes to Blackrock - Surveys Give Big Investors an Early View From Analysts (NYT)
• At least housing has bottomed: London House Prices Plunge As Supply Rise Adds To Lull (Bloomberg)
• Christine Lagarde and Nicolas Sarkozy embroiled in new corruption inquiry (Telegraph)- at least that fraud they created: Others helped them create it.
• Heat Leaves Ranchers a Stark Option: Sell (NYT)
• Merkel Gives No Ground on Demands for Oversight in Debt Crisis (Bloomberg)
• The euro skeptics have the best lines again (FT)
• Wen Says China’s Economic Recovery yet to Show Momentum (Bloomberg)
• Europe’s Banks Face Tougher Demands (FT)
• Madrid Region To Sell 100 Office Buildings Amid Austerity (Bloomberg)
• China eases taxes for foreign companies (FT)