(Die Welt) "East countries should we now not dictate morality" Italian Prime Min

"East countries should we now not dictate morality" 

Italian Prime Minister Matteo Renzi speaks out to solve the refugee crisis for the EU South-East expansion. And he reveals what he does when he wants Angela Merkel resent times.

Matteo Renzi enters vigorously. He almost bounced on the door of the Renaissance Library of Palazzo Chigi, the government palace from the 16th century, together with the photographer. Tempo is his trademark. So far, his government has renewed the right to vote, the Senate, the labor market, public administration and partly Treasury and Civil Law. The Italians he informed daily via Twitter.

Die Welt: What do you tweet today?

Matteo Renzi: ". Civil Justice A structural reform that went by almost unnoticed." We have the latest figures for the first year. They show that the transition to the telematic process (digital file management, d. Red.) Has considerably shortened the processing time. In the city of Rome it has fallen by 48 percent. This also applies to the fight against tax evasion. The digital data synchronization has transported 224,000 tax evaders to day. The ancient Romans would say 'Quantum mutatus from illo!'. How much has changed ... since we are traveling with the rickety campers through the Lombard plain!

An earlier interview with Matteo Renzi, Mayor of Florence at that time, we had done during a trip in the camper, with whom he toured in 2012 as a candidate for the presidency of the PD by Italy. In December 2013. He became party secretary, in February 2014 then Premier.


Die Welt: You are head of government and party, seem to have little competition ...


Renzi: Two years ago in Italy was stopped, fainting. It was the Italians, not I, who had tired of it. They wanted a change of pace. I took office with the intention not to end up like Greece, but to do better than Germany. Now Italy is back and on the right track.

Die Welt: What happened to Silvio Berlusconi has become?

Renzi: Berlusconi is the past. I deal with the future.

The World: Unlike him, join our Chancellor best dogs: They laugh, make jokes together. How is your relationship?


Renzi: It's a good relationship, I guess Angela very. We are very honest with each other and tell us the things as they are, even where our opinions diverge.

The World: Where is this the case?

Renzi: In the vision of European economic policy over the past ten years: It was based on austerity, not on growth. For me that was a mistake. But as long as it stays that way, I will respect the rules. With a deficit of 2.2 percent, we have enforced a labor market reform this year. 2016, the debt will fall for the first time. If I want Angela annoy me, I remind you that Germany has used for three years and exceeded the three-percent mark.

A liveried waiter brings Espresso. Matteo Renzi jumps up, takes the tray, enough even the cups on. The photographer he jokes: "No pictures, I'm not Angela Kellner."

Die Welt: What do you think of Ms. Merkel's refugee policy? Was it right to open the borders? What if they are closed again?


Renzi: We can not build new walls. Today (the interview was held on November 9, the Red.) Is the day that commemorates the fall of the Berlin Wall. Walls are built so that they tear. Walls are no protection, they are a trap. The refugee problem we must solve together and us be clear that it will take many years in Europe.

The world: Do we have such a long time?

Renzi: The summit in Malta is on the program for six months. It is important to draw new guidelines for international cooperation with African countries. In Italy I have already made ​​clear that we are still having to spend more money. We are the country which is paying the largest part in the European-Africa Fund. This is a long-term strategy.

The world: In Europe, but now reigns chaos ...

Renzi: Who says he will solve the problem within a week, only plays Marine Le Pen or other right-wing demagogues to the ball. We must not panic. In Italy, the flow of refugees for two years has swelled to twenty times to record levels. I called anyway to rest and reflection, although the opposition was storm. We need a long-term strategy, which is applied on an annual ...

Die Welt: Are not you afraid that the Union can break in the meantime to the right-wing demagogues? They are indeed in Italy, the Lega Nord.

Renzi: hits me particularly the behavior of the newer Member States. You owe Europe a lot. In some Western European countries, parties and politicians have their election and lost items to defend the European idea. Fearing the Polish plumbers went to France a referendum lost! The Western Europeans have paid a political price for the enlargement. It's not okay if these countries now dictate morality. I ask indeed anyone for help for Italy. The number of refugees who come every year to Italy, we create alone. But the entire challenge must tackle as a whole Europe. Alone Italy eventually pay each year nine billion to the Union, which also contribute to the growth of the new member states.

The World: How do you convince people like your Hungarian colleagues Viktor Orbán of it before it's too late?

Renzi: This issue concerns not only Orbán. It does not separate into right and left. It cuts across the parties. The socialists in the Czech Republic and Slovakia are on the same line as Orbán and many Poles. It is a geographical, not a political division between those who know Europe as a great ideal and those who primarily see it as an economic benefit. It embittered me to see that the walls are built, pitfalls for freedom. I want to continue to believe in the great ideal!

The world and the provisional, practical solution?

Renzi: The Union does not exist without common ground in addressing the great dramas and problems of our time. Immigration is a real problem. Hotspots, redistribution, repatriation, all must respect these institutions and rules. But these are technical aspects. The European Union is not just a set of rules and we are not only a union of taxpayers. Europe is a country with 500 million inhabitants. For the world, it is a model of civilization and can do this.

The world: Who has ever looked into the hot spots, know how slow in Europe much running. Is that a model?

Renzi: Everything is slow. We have been condemned by the European Court, because we have people sent back before the judgment of second instance was there. Our share of the work, even in the hot spots, we'll do. We have the people rescued from the Mediterranean, when we were still so alone. Now bring our Navy the dead from the wreck from the seabed, because we want to give them a funeral. We are human beings, not animals. If you hide a child who drowned in the hold of a cutter, then do not count election forecasts. I would put it rather a choice on the line.

The world the other way around: What can Europe do to stem the flow of refugees?

Renzi: It has to change the direction of view. The Union has been extended only to the east. But it was a tragic and historic mistake to omit the Balkans. Albania, Montenegro and Serbia have in the Union have priority.

The world must also return to operate when it is necessary?

Renzi: It can be linked to development projects in the agreements with African countries. That is our strategy. Africa will experience in the next 20 years an enormous upswing. We have begun to invest: in Egypt, Mozambique and Ghana. In Kenya and Ethiopia, there are projects. I myself have visited several countries in sub-Saharan and planning further trips. None of my predecessors in Italy did.

The world: Italy has historically close relations with Libya. Can you help with mediation and formation of a government? What is the status of the negotiations?

Renzi: There is still no solution in sight, only very delicate glimmer of hope. But intervene, bomb, can be briefly celebrate in Tobruk and then the retreat, which is not a strategy. We sit down with all his strength for a diplomatic solution to a, at all focal points of the region. In Lebanon, we are present with our UNIFIL contingent. I have just returned from Riyadh, where I met the Saudi king. I meet soon Hassan Ruhani. Like Germany, Italy is in Afghanistan on site. We need a medium-term strategy and no last-minute solutions. Last Minute makes you travel, but not politics!

(UBS) Europe Thematic Outlook 2016 : Buy crisis gaps at new high: Europe is clea

Buy crisis gaps at new high: Europe is cleansed

Time is right: Europe has just lived through 3 Black-swan like events

Crisis Gaps: surprisingly at the highest level in crisis
We were taken aback when we combined the gaps. The gap below is higher today
than at any time since the 08/09 crisis. The gaps we focus on include: 1) Real yield gap
for Equities vs Bunds where equities still offer 80% of their peak excess yield. 2) UBS
Cyclical/Defensive index is today below its 09 and 12 crisis troughs. Cyclicals are valued
for a recession (pg 19); and 3) Europe vs the US: the profit 'and' valuation gaps are at
90% of their peak at any time during the crisis.

How can they be higher than in the Mar 09 or Jul 12 meltdowns?
The US and European profit gap in early 2010 was only one-fifth what it is today.
Europe's ROE gap to the US is still at a decade high (fig 1). We may be putting the
sovereign debt crisis, austerity straight jacket, stress tests and a lock-down in credit
markets behind us, but they drove a DIVIDE between Europe and the US that is
'combined' at its highest level today. The cyclically adjusted PE (CAPE) comparison
suggests Europe is in recession. Plus, this isn't just about Technology and/or sector
differences. Our Sector Adjusted PB comparison to the US (pg 3) also shows levels
normally associated with a Europe that is in recession.

But why will gaps narrow? Europe is cleansed after 3 Black Swan like events
Europe has been through: 1) Sept 08 Lehman's shock: Financial profits fell 72% and
the profit hit was a '6.4 standard deviation' event (once in every 22,000 months); 2)
Oct 09 Greece shocked all and during 2012 Italian bond spreads experienced a 2.8
standard deviation move; 3) Jun 14 brought the commodity meltdown: the cut to
Energy earnings was a 3.5 standard deviation event and helped to wipe out Europe's
EPS growth for this year. We believe that Europe has been largely cleansed of last
cycle's material excesses and is now free to focus on growth.

Trades: Buy Europe, ROE 'catch up to US' & Cyclical dividends
1) DJStoxx 600 vs S&P500. CAPE PE & Sector Adjusted Price/Book gaps are at recession
levels; 2) ROE catch-up to US offer names with a Value Tilt; 3) Safe Cyclical Yield:
relative yield to defensives at a decade high, list offers yield of 4.7%.

WSJ : No Need to Cut Rates Now, Says ECB Council Member

No Need to Cut Rates Now, Says ECB Council Member

Comments from Ardo Hansson suggest additional stimulus is not universally supported

TALLINN, Estonia—There is no need at the current juncture for the European Central Bank to reduce its policy rates, including the deposit rate, the head of euro member Estonia’s central bank said in an interview on Wednesday.

The comments by ECB governing council member Ardo Hansson suggest that additional ECB stimulus, which is widely expected by economists to be announced at the bank’s Dec. 3 meeting, is not universally supported within the ECB’s 25-person governing council.

Other central bankers, particularly from the eurozone’s Baltic region, have expressed skepticism about the need for additional easy-money policies, though these voices are likely not numerous enough to block any such moves should top officials want to press forward.

Mr. Hansson said that lowering the ECB’s deposit rate further from the current -0.2% can be discussed and technically it is possible, but so far there is no proposal on the table.

“Knowing what I know now, I don’t think we should take that step,” Mr. Hansson said. “But if the trend in the next few weeks turns much negative, then every option is technically possible to analyze, but in the end it has to be a pretty thorough analysis."

The ECB’s deposit rate has stood at -0.2% since September 2014. At that time, ECB President Mario Draghi signaled it would go no lower. But he changed tack after the ECB’s meeting last month, saying that lowering it was discussed.

With a negative deposit rate, the ECB effectively charges financial institutions to store surplus funds at the central bank. The measure typically has a pair of benefits: spurring banks to lend to the private sector; and weakening the exchange rate.

Hopes for additional ECB stimulus have been fanned by low inflation—consumer prices were flat annually last month, well below the ECB’s target near 2%—and signs that the eurozone’s recovery remains lackluster. Still, Mr. Hansson’s comments suggested that there is little evidence the region’s outlook has changed enough in the past few weeks to justify additional stimulus.

“We have to see how the incoming data look and look at the forecast when it emerges in December to see if there’s a fundamental need to revisit” the current projections, Mr. Hansson said.

He added that most of the indicators, such as the latest inflation and retail sales data, released since the ECB’s last meeting in Malta on Oct. 22 have been more positive than negative.

“I don’t see the situation so pessimistically,” Mr. Hansson said. “Had it been that the news coming out of Malta would be systematically negative, I think it would be different.”

In particular, he said that inflation should start rising in the coming months as the effects of steep drops in energy prices drop out of the data.

“Inflation numbers in December and January should show sharp increase in headline inflation because of the erosion of the base effect related to the energy prices. That would be interesting and important to see how big that increase in headline inflation is and how that affects the outlook and expectations,” he said.

Mr. Hansson, a known skeptic of the ECB’s broad-based asset-purchase program, known as quantitative easing, or QE, did not want to comment on whether it should be increased in December. “We still have three weeks until that meeting,” he said.

Under the program launched in March, the central bank is buying €60 billion ($65 million) in mostly government bonds a month. The program is due to run until at least September 2016, but Mr. Draghi has signaled that the central bank could expand it at its next meeting in early December.

Mr. Hansson said that because the program’s end date is still some 10-11 months away, there is “plenty of time” and “no pressing need” for the council to make a decision next month on whether to extend it or not.

“The clock is not ticking in the way that would force us to decide now,” Mr. Hansson said. “I think it would make more sense to think about it a bit later, when we get closer to the announced end of the program to see what comes next. Because then you have more information about how things are progressing.”

He added that it would "make a lot of sense” to start talking about it about six months before the program ends.

Brian Blackstone contributed to this article.

>>> US Gapping down

Gapping down
In reaction to disappointing earnings/guidance
: EVDY -27%, WPRT -15.5%, M -8.5%, MNGA -5.9%, JUNO -5.4%, XENE -4.5%, EXEL -3.6%, DOX -3%, FENG -2%, TLF -2%, MIDD -1.1%, BC -0.8%

Other news: HZNP -16.9% (responds to Express Scripts (ESRX) lawsuit and recent allegations; believe claims are without merit), INSY -11.5% (Express Scripts (ESRX) terminates relationship with specialty pharma Linden Care, sues Horizon Pharma (HZNP)), NEOS -9.6% (received Complete Response Letter from the FDA regarding the NDA for Cotempla XR-ODT), NBG -6.2% (cont weakness), MNGA -5.9% filed for $50 mln mixed securities shelf offering),), AFSI -5.4% (commences an underwritten public offering of 5 mln of its common stock), VWR -3.7% ( files for a 9 mln share offering of common stock by selling stockholder), STAY -1.8% (Extended Stay America and Extended Stay America commence 15 mln paired share offering on behalf of selling shareholders), PINC -1.8% (prices offering of 4,033,198 shares of common stock at $34.50 per share on behalf of certain selling member-owner stockholders), SMCI -1.7% (filed to delay Form 10-Q), LOXO -0.9% (announces a proposed offering of 2 mln shares of common stock)

Analyst comments: BCRX -2.9% (downgraded to Underperform at BofA/Merrill), ORCL -1.7% (downgraded to Equal-Weight from Overweight at Morgan Stanley), MET -1.5% (downgraded to Equal-Weight from Overweight at Morgan Stanley), EMC -0.6% (downgraded to Market Perform from Outperform at Wells Fargo
)