Daily updates on climate change and the global economy.

Daily updates on climate change and the global economy.
Stay current with what’s happening around the world with a quick scan of top news.

Daily updates on climate change and the global economy.
Stay current with what’s happening around the world with a quick scan of top news.

Daily updates on climate change and the global economy.
Stay current with what’s happening around the world with a quick scan of top news.

Daily updates on climate change and the global economy.
Stay current with what’s happening around the world with a quick scan of top news.

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Ten years ago, deteriorating confidence in the value of US sub-prime mortgages threatened a liquidity crisis. The US Federal Reserve injected considerable capital into the market, but could not prevent the 2008-2009 global financial crisis…

“Most developed country governments are now more heavily indebted than in 2008, when they bailed out large financial institutions, but failed to sustainably revive the world economy. Major monetary authorities do not have much policy space left after long pursuing unconventional expansionary policies.

“Meanwhile, developing countries have been subject to increasing international integration, e.g., through global value chains, foreign financial institutional investments and increased short-term capital flows induced by the unconventional monetary policies of the US Fed, ECB and Bank of Japan, while debt-sustainability concerns for some are growing again.

“These vulnerabilities have been compounded by growing trade protectionism, and dwindling precautionary reserve holdings of many developing economies as global trade has slowed. Even before President Donald Trump’s election, developed countries had effectively killed the Doha Development Round, not least by opting for bilateral and plurilateral, instead of multilateral free trade deals.

“Trump’s more explicit rejection of multilateralism in his efforts to eliminate major US bilateral trade deficits are now expected to further set back prospects for world economic recovery. Despite pious declarations to the contrary, most national policymakers typically turn from rhetoric about international cooperation to focus on domestic issues.

“It has not been different this last time. A decade after the worst economic downturn since the 1930s’ Great Depression, the world economy remains vulnerable.”


“U.S. interest rates are moving higher because the U.S. government is taking on more longer term debt and global central banks are stepping back from some of the easy policies they adopted in the financial crisis… For its part, the European Central Bank is also stepping away from easy policies, though more stridently. It is expected to soon end its asset purchase program. That, too, could pressure global rates higher.”


“The Bank of England is poised to raise interest rates above the level set since the aftermath of the financial crisis for the first time, despite a weakening outlook for the British economy and growing risks from Brexit.”


“Factory growth stuttered across the world in July, heightening concerns about the global economic outlook as an intensifying trade conflict between the United States and China sent shudders through trading partners.”


“President Trump is expected to provide an update on the China trade war later today. Expectations are that the $200 billion worth of Made in China goods being tossed around to get hit with a 10% duty at American ports will now be upped to 25%.”


“Police fired tear gas to disperse stone-throwing protesters in Harare on Wednesday as the main opposition leader accused the ruling party of trying to rig the result of Zimbabwe’s election.”


“South Africa’s white farmers on Wednesday criticized the ruling African National Congress’ (ANC) decision to endorse constitutional changes to allow the state to seize land without compensation, saying the move would be “catastrophic”.”


“Saudis are increasingly taking on such “low status” jobs in a new age of austerity when gas is no longer cheaper than water, with the government trimming oil-funded subsidies and tackling sluggish economic growth and high unemployment.”


“Mohammad is among the hundreds of thousands of Afghan migrants who once flocked to Iran for work but who have returned to their war-torn homeland amid a crippling economic crisis.”


“The southern city of Basra was once known as the “Venice of the East” because of its freshwater canals, and Iraq itself is still known as the “Land Between the Two Rivers” — the Tigris and the Euphrates — which have nourished civilizations since antiquity. But upstream dams in Turkey, Syria and Iran have shrunk the rivers and their tributaries, seasonal rainfall has dropped and infrastructure has fallen into disrepair. The result is an acute lack of freshwater…”


“The Pakistan Bureau of Statistics (PBS) has said that the Consumer Price Index-based inflation rate in Pakistan has surged to a four-year high in the month of July 2018.”


“Turks registered 64,341 motor vehicles in June, a decline of 36 percent from May and 33 percent compared with the same month of 2017, the Turkish Statistical Institute said on its website on Wednesday.”


“According to the United Nations High Commissioner for Refugees (UNHCR), at least 23,000 people have fled Nicaragua to Costa Rica due to the neighboring country’s violent conflict.”


“Venezuelan gangs are already making their influence felt in Guayanese territory. In April miners in the town of Eterinbang, south of Whitewater, reported that heavily armed sindicatos had set up a base on the Cuyuni river and were attacking boats that refused to give in to their extortion attempts.”


“The last time Argentine companies embarked on buyback programs on a large scale was during the 2008-2009 financial crisis that plunged Argentina into recession. The only other time was in 2002, when the country defaulted on its foreign debt and the economy collapsed.”


Not good, as we need robust debt growth: “State and local governments and companies are expected to issue fewer bonds this year for the first time since 2015, a cautionary sign for the economy as market volatility and rising interest rates start to weigh on appetites for borrowing. Global bond issuance is expected to fall to roughly $6 trillion in 2018, down 4.2%.”


Read yesterday’s ‘Economy’ thread here.

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