Morning Reading – November 30, 2010

Forbes: An Interview With WikiLeaks’ Julian Assange

In a rare, two-hour interview conducted in London on November 11, Assange said that he’s still sitting on a trove of secret documents, about half of which relate to the private sector. And WikiLeaks’ next target will be a major American bank. “It will give a true and representative insight into how banks behave at the executive level in a way that will stimulate investigations and reforms, I presume,” he said, adding: “For this, there’s only one similar example. It’s like the Enron emails.”

Silk Road Economy: Light rail. Heavy losses.

China Railway Construction Company has taken a $630 million loss on its light rail project in Mecca. The project links holy sites around Mecca and has a capacity of 90,000 passengers an hour. It had attracted considerable attention from the international media, as evidence of China’s strengthening relations with Saudi Arabia. So the loss has raised eyebrows.

FT Alphaville: Another shock from Shanghai

Another day and another miserable session for the Chinese stock market, which fell 1.3 per cent overnight to a seven week low.

FT Alphaville: Spanish bonds go beyond the parabola

While all other European sovereign markets began Tuesday’s session relativelysteady, there was one major exception — Spain.

FT Alphaville: The ‘Europeseta’ tests psychological resistance

But EURUSD is on Tuesday convincingly pushing at the 1.30 resistance level, having penetrated the “psychological” boundary on a number of occasions already..

FT Alphaville: Insolvent – Greece, Ireland, Portugal and probably Spain

Former FT blogger Willem, ‘Maverecon’, Buiter has lost none of his power to shock.

He may be the chief economist of Citigroup but that doesn’t mean he can’t speak his mind as his latest essay for the bank’s clients proves.

In it, Buiter claims Ireland is insolvent, Portugal is quietly insolvent, Greece is de facto insolvent and Spain will be insolvent once the problems in its banking sector are recognised.

Macro Man: Nightmare before Christmas

But say we were to wake up and find ourselves in their nightmare. What would We do?

TMM notes that our path from here is not exactly clear but there are options for which we have invented code names used by the leaker in Merkel’s office***:

  1. Increase the size of the EFSF (“Big Bertha”).
  2. Create a pan-European bank recapitalization fund and new stress-test round (“Groundhog Day”).
  3. Explicitly rule out the SDRM (“Horatio Nelson”). Burying head in sand optional.
  4. Instruct the ECB to go nuclear and buy bonds unsterilized (“Dr Strangelove”). Utter loss of credibility counseling to be provided by the Fed.
  5. Require Sov CDS to be 100% margined (“The Little Bighorn”). Watch Euro dive some more as all those “down with Europe” flows go into the one remaining market they can.
  6. Immediately stick Portugal and Spain into the EFSF (“2 tons of you-know-what in a 1 ton bag”). Have you ever had your shopping bags rip breaking all your eggs on the way home from the grocery store? We have.

The Big Picture: The Joy Of Stats

Hans Rosling’s famous lectures combine enormous quantities of public data with a sport’s commentator’s style to reveal the story of the world’s past, present and future development. Now he explores stats in a way he has never done before – using augmented reality animation. In this spectacular section of ‘The Joy of Stats’ he tells the story of the world in 200 countries over 200 years using 120,000 numbers – in just four minutes. Plotting life expectancy against income for every country since 1810, Hans shows how the world we live in is radically different from the world most of us imagine.

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