Here's today's look at some of the top stories on markets and politics in Europe:

ICAP to pay $87 million for alleged Libor fixing

The London inter-dealer brokerage ICAP agreed to pay $65 million to U.S. and U.K. regulators to avoid civil lawsuits involving three former ICAP employees' participation in rigging the Libor interest rate. Libor is calculated as an average of interbank rates submitted by individual banks. The three ICAP brokers, all British, allegedly persuaded acquaintances in London banks to file certain rates, thus “fudging” Libor in the interests of their clients. One of the brokers, Colin Goodman, was so successful at this that he was known as Lord Libor. The three former ICAP employees were charged with fraud. About $350 trillion worth of financial products worldwide is based on the Libor, and the continuing rigging scandal, involving so far only European financial institutions, is extremely damaging to London's reputation as a top global financial center. You have to wonder if U.K. regulators would be cleaning up the mess at all, if their U.S. counterparts hadn't got involved.

U.K. sues to overturn bank bonus curb

George Osborne, the U.K. finance minister, filed suit with the European Court of Justice to have a European Union cap on bankers' bonuses removed. The cap, coming into effect in 2014, limits variable pay for the year to twice the annual salary. Osborne argued that the regulation works to reduce bankers' responsibility, because financial institutions will increase base pay to circumvent it. He is right: it is already happening. In July, the consultancy Mercer surveyed European banks, and 79 percent of them said they would raise salaries in response to the bonus cap. Europe should back off on the populist measure. There are plenty of other things to regulate in the financial sector that would actually make it safer for investors.

Nokia considers alliance with Alcatel-Lucent

After selling its mobile phone business to Microsoft, Nokia is considering an alliance with Franco-American competitor Alcatel-Lucent. The Finnish company's biggest remaining business is the making of wireless network equipment, which has little presence on the U.S. market. By contrast, Alcatel is strong in the U.S. in that area, but is growing more dynamically in optical cable networks. Nokia could buy Alcatel's wireless business with proceeds from the Microsoft deal, and thus present a bigger threat to market leader Ericsson and Chinese network equipment makers Huawei and ZTE. Even if the Alcatel tie-up does not take place, talk of it is a welcome change of subject for Nokia. In recent days, it made headlines with outgoing chief executive Stephen Elop's $25 million payoff, which outraged Finning politicians and public. Nokia chairman Risto Siilasmaa reportedly asked Elop whether he would give back part or all of the sum, but Elop refused, saying he was in the middle of a divorce. Nokia is right in seeking to put the whole Microsoft story behind it and formulate a strategy for the future.

Grohe sold to Japanese competitor

Japanese building materials company Lixil is taking over Europe's biggest supplier of bathroom fixtures, Grohe, for $4.1 billion. This is the largest Japanese investment in Germany to date. Grohe's financial investors, TPG and DLJ Merchant Banking Partners, are selling 87.5 percent of the German group, which they bought in 2004 for about $2 billion. The financial investors restructured Grohe, mercilessly cutting costs and giving rise to discussions of greedy “locusts” in the German press. Now they can book a hefty profit, and the Japanese company can help itself to the European sanitary fittings market.

Merkel's old apartment rents for $74 per night

German Chancellor Angela Merkel's former apartment in Berlin's Prenzlauer Berg area has been put up for rent on the online service Airbnb for $74 per night. It's a modest two-room, 592-square-foot lodging in a pretty, green area of former East Berlin, where Merkel lived before when she worked at East Germany's Central Institute of Physical Chemistry in the 1980s. The apartment has been completely refurbished since, in line with the gentrification of the formerly dilapidated neighborhood of old buildings. Nothing of Merkel remains there apart from the walls and the older neighbors' memories, but after Merkel's recent resounding election victory, tourists are likely to flock to the apartment.

(Leonid Bershidsky, an editor and novelist, is a Bloomberg View contributor. He can be reached at bershidsky@gmail.com).