News and Analysis | Asymptotix

Bigger euro bailout fund needed to create space to boost growth, OECD says

Euro area finance ministers meeting this week need to boost the firepower of the European stability funds to at least one trillion euros, OECD Secretary-General Angel Gurría said today.

The current level of commitment to the rescue funds is not enough to restore market confidence, he said. A credible financial firewall will provide governments with the breathing space they need to focus crucially on revitalising Europe’s economic growth and competitiveness.

Progressive Credit Risk Management (CRM) Improving The Cost and Availability Of Corporate Credit

Progressive Credit Risk Management (CRM) transparently presents “own credit risk” to improve Asset-Backed transaction terms. When the CRM output is combined with insurance and funding methodologies, the financial benefits are striking. This is because banks rarely offer funding terms based on a due diligence process as thorough as the company themselves can execute daily.

Policymakers are keen for banks to lend. However, the banking model is broken. Many of the methodologies developed to intermediate credit are no longer cost effective or trusted by investors. Banks have responded by tightening credit issuance and de-leveraging. Alongside tougher Basel and domestic regulation, fee-earning has been hit. Banks are using general de-leveraging to cleanse their exposure to individuals, companies, other banks/ Financial Institutions and sovereigns who they believe will not only be unable or unwilling to repay debt but also unable to afford the cost of re-priced risk.

Make your own bank stress test

LTRO: Criminal Political Behaviour by Merkozy with Van Rompuy as the Marionette

Think about it, as LTRO triggers on the leap day TODAY, why is the Central Bank being forced to do this against its will? The European monetary transmission mechanism doesn't have an IMF-Equivalent; so not only is the euro a political mishmash at the concept level its a stool (sic) on two legs at the practical institutional level.

EU Money supply is at rock bottom, the pump at the 'heart' of European money supply is on life support.

That 'life support' is LTRO from the Central Bank, right? The Central Bank should be independent right? It shouldn't be pumping up the very thing that it is chartered to control, that is perversity by definition right?

THAT ARMAGEDDON SUMMER OF 2010 Lessons for LTRO2 in 2012

THE SEQUENCE OF EVENTS ON ASYMPTOTIX

SECRETS LIES & SMOKE AND MIRRORS

White Papers on Software Architecture for Financial Services by asymptotix

Warren Buffet is Misrepresenting the Logic of Gold Investment by Peter Trzaska

The Political Economy of LTRO

INTRODUCTION

It's LTRO[1] that I’m talking about this time! LTRO the latest version of “economic life support those” crackpot surgeons in the Central Banks and Treasuries of Europe have come up with. What is the issue with it? As LTRO2 approaches, to on the leap day (29/2/2012) I present a number of theses about LTRO;

1. LTRO is a workaround for Crowding Out

2. LTRO is executed via a process called 'Round Tripping' or known as a ‘Carry Trade’

3. Hedge Funds are intrinsic to the success of LTRO

4. This makes governments dependent upon Hedge Funds (& not just the banks)

5. LTRO creates a cash balloon which props up the equity market

6. LTRO is a high-risk central bank strategy which could deflate at a stroke

7. Ironically the very Hedge Funds and Asset Managers who are intrinsic to the success of LTRO are already freaked out by the high risk nature of the policy,

The Gold Market De and Re Constructed a radical forward look by Peter Trzaska

Modelling the Product Hierarchy for Financial Services

Modelling the Product Hierarchy is absoloutely crucial paticularly as technology advances in response to specifically the evolving compliance requirements in Financial Services. Therefore I have totally updated if not reconstructed this page in response to its volume of reads and the discussion it prompted. I intially developed this set of references 'to order' when working with IPL on

An Information Framework for Financial Services Supervision

In my initial version of this blog / web-page; this is all I had to say;-

" Below a set of references, typically 'asymptotix-eclectic' which provide a roundup of captured and developed IP in this space to date. "make your Life easy"! There is no need to re-invent the wheel, IBM and SAP have been thinking about it for decades "

http://www.tdan.com/view-featured-columns/5400/

ftp://service.boulder.ibm.com/software/data/mdm/pdf/IFW_Process_GIM.pdf

http://mike2.openmethodology.org/wiki/Guidelines_for_Using_the_FSLDM

http://help.sap.com/saphelp_nw04/helpdata/en/f8/580f40763f1e07e10000000a1550b0/frameset.htm

http://www.ibm.com/developerworks/websphere/library/techarticles/0909_nigam/0909_nigam.html

Below the (NEW, Feb 2012-version) reconstruction and update of asymptotix material on modelling the Product Hierarchy in Financial Services

“you can't have a product without a customer”

SAS linx as REFERENCES asymptotix

I recently got invited to go & talk to a SAS shop, a big one! This has not happened for a while (to me), well it wouldn't, would it? These (recent) days I (have been) a confirmed R man¹, maybe a wee bit of S+ but R; Revolution R² if possible but R; Hadoop³ ⁴yes, Netezza⁵ ⁶, yes & the deliriously beautiful SAP HANA⁷ but for me it has to be R, well that's the way I have attitudinised⁸ it here on asymptotix!!

STATEMENT OF THE MEMBERS OF THE EUROPEAN COUNCIL 30 JANUARY 2012

TOWARDS GROWTH-FRIENDLY CONSOLIDATION AND JOB-FRIENDLY GROWTH

Over recent months, there have been tentative signs of economic stabilisation but financial market tensions continue to dampen economic activity and uncertainty remains high. Governments are undertaking strong efforts to correct budgetary imbalances on a sustainable basis but further efforts are needed to promote growth and employment. There are no quick fixes. Our action must be determined, persistent and broad-based. We must do more to get Europe out of the crisis.

Copula Dependence Structure on Stock Market with Application to Risk

Bayesian Methods in Portfolio Credit Risk Management

Bayesian Methods in
Portfolio Credit Risk Management
A dissertation submitted to the
SWISS FEDERAL INSTITUTE OF TECHNOLOGY
ZURICH
for the degree of
Doctor of Sciences
presented by
JONATHAN ERIK PURVIS WENDIN
MSc. Engineering Physics KTH
born 17 April 1978
citizen of Sweden
accepted on the recommendation of
Prof. Dr. Alexander J. McNeil, examiner
Prof. Dr. Peter L. Bühlmann, co-examiner
Prof. Dr. Philipp J. Schönbucher, co-examiner

Basel III liquidity standard and strategy for assessing implementation of standards

The GHOS endorsed the Committee's comprehensive approach to monitoring and reviewing implementation of the Basel regulatory framework. GHOS Chairman and Governor of the Bank of England Mervyn King noted that "the focus on implementation represents a significant new direction for the Basel Committee. The level of scrutiny and transparency applied to the manner in which countries implement the rules the Committee has developed and agreed will help ensure full, timely and consistent implementation of the international minimum requirements".

European Disunion indecision 2011

Inside the French ambassador's 19-bedroom mansion, finance ministers and central bankers from the world's largest economies heard Dominique Strauss-Kahn, then-head of the International Monetary Fund, deliver an ultimatum. Greece, the country that triggered the euro-zone debt crisis, would need a much bigger bailout than planned, Mr. Strauss-Kahn said. Unless Europe coughed up extra cash, the IMF, which a year earlier had agreed to share the burden with European countries, wouldn't release any more aid for Athens.

9 December 3 AM: Statement by euro area heads of state or government

The European Union and the euro area have done much over the past 18 months to improve economic governance and adopt new measures in response to the sovereign debt crisis. However, market tensions in the euro area have increased, and we need to step up our efforts to address the current challenges. Today we agreed to move towards a stronger economic union. This implies action in two directions:

- a new fiscal compact and strengthened economic policy coordination;

- the development of our stabilisation tools to face short term challenges.

European Commission Green Paper on the feasibility of introducing Stability Bonds - Official Version

Brussels, 23 November 2011

European Commission Green Paper on the feasibility of introducing Stability Bonds

Will Merkel Change Her Tune on Stability Bonds?

Stability bonds. That is the new moniker given by the European Commission to euro bonds as it moves toward presenting its most definitive proposal yet for the debt pooling measure on Wednesday.

Indeed, European Economic and Monetary Affairs Commission Olli Rehn was in Berlin on Tuesday to tout Brussels' three-option studyon how bonds issued jointly by the 17 euro-zone member states could help stem the debt crisis.

Niall Ferguson on United States of Europe 2021

Niall Ferguson, Professor of History at Harvard University, has written a tendentious new book, “Civilization,” which asserts, with similar certainty, that we are now living through “the end of 500 years of Western predominance,” that while China is on the rise, the question is not whether East and West will clash, but whether “the weaker” — that is, the United States and Europe — “will tip over from weakness to outright collapse.”

What price the new democracy? Goldman Sachs conquers Europe

This is the most remarkable thing of all: a giant leap forward for, or perhaps even the successful culmination of, the Goldman Sachs Project.

Read the article here: http://www.independent.co.uk/news/business/analysis-and-features/what-pr...

Cutting Eurostat to Pieces

The present writer took up his Eurostat post in March 1991, right after Desert Shield. He was told then that Eurostat "had no right" to publish economic analyses and those instructions were repeated from time to time ever since. No Eurostat publication that he has seen contained any fruits of the officially forbidden research.

Flash estimate for the third quarter of 2011: Euro area and EU27 GDP up by 0.2%

GDP increased by 0.2% in both the euro area (EA17) and the EU27 during the third quarter of 2011, compared with the previous quarter, according to flash estimates published by Eurostat, the statistical office of the European Union.

In the second quarter of 2011, growth rates were +0.2% in both zones.

Compared with the same quarter of the previous year, seasonally adjusted GDP increased by 1.4% in both zones in the third quarter of 2011, after +1.6% in the euro area and +1.7% in the EU27 in the previous quarter.

US Bank exposure to PIIGS

Five US banks have released some data (SEC filings) of their exposure to PIIGS.

Source WSJ

Economist: Europe's deepening crisis

Autumn forecast 2011-13: Growth at a standstill

Commission Vice-President for Economic and Monetary Affairs Olli Rehn said: "Growth has stalled in Europe, and there is a risk of a new recession. While jobs are increasing in some member states, no real improvement is forecast in the unemployment situation in the EU as a whole. The key for the resumption of growth and job creation is restoring confidence in fiscal sustainability and in the financial system and speeding up reforms to enhance Europe's growth potential. There is a broad consensus on the necessary policy action. What we need now is unwavering implementation. On my part, I will start using the new rules of economic governance from Day one."

ECB Overnight Deposits 2011 (statistics)

Lenders increased overnight deposits at the European Central Bank to the highest level in more than 16 months.

Banks parked 299 billion euros ($412 billion) with the Frankfurt-based ECB yesterday, up from 288 billion euros on Nov. 4. That’s the most since June 30, 2010, and compares with a year-to-date average of 71 billion euros.

ECB Overnight Deposits 2011

The big fat Greek Drahma

Yesterday, Giorgos Papandreou was at the center stage for

EZ politix is not a Western movie

did the Greeks call the referendum because they had advanced intelligence that the #EFSF would not be able to raise a cent?

Windows Server 8

Microsoft has not announced a ship date for Windows Server 8, although roadmap documents released some time ago pegged it for 2012 (earning it the nickname of Windows Server 2012). A developer's preview of Windows Server 8, including Hyper-V, was made available during Microsoft's BUILD conference in Anaheim, Calif., in September.

Much more than a minor upgrade, Windows Server 8 brings many new features and functionality. The software is currently a Developer Preview release. This means Windows Server 8 isn't even available for beta testing yet.

Windows Server 8 is a much more significant release than Windows Server 2003 or Windows Server 2008. Both of those products were good, but they were mostly evolutionary. In Windows Server 8, Microsoft has taken a much bolder approach and is creating an OS that's by far the most innovative since Windows 2000 Server.