“The gathering storm of human-caused threats to climate, nature and economy pose a danger of systemic collapse comparable to the 2008 financial crisis [considerably worse in my view, as we are way more indebted, and energy and resource-constrained, and the biosphere is in even greater disarray] according to a new report that calls for urgent and radical reform to protect political and social systems.
“The study says the combination of global warming, soil infertility, pollinator loss, chemical leaching and ocean acidification is creating a “new domain of risk”, which is hugely underestimated by policymakers even though it may pose the greatest threat in human history.
““A new, highly complex and destabilised ‘domain of risk’ is emerging – which includes the risk of the collapse of key social and economic systems, at local and potentially even global levels,” warns the paper from the Institute for Public Policy Research. “This new risk domain affects virtually all areas of policy and politics, and it is doubtful that societies around the world are adequately prepared to manage this risk.””
“While many bullish (optimistic) investors were attempting to shrug off the European economic slowdown several months ago, including the ECB, claiming a rebound was just around the corner in 2019, the data is here to refute that claim.
“The economic data across the Eurozone has deteriorated at an accelerated pace in 2019 as the probability that the entire Euro Area falls into a recession is rising.”
“Since 2010, the UK has endured its slowest economic recovery on record and the outlook is merely worsening… in December the UK economy contracted by 0.4 per cent…. Manufacturing has now contracted for six months in a row, while business investment has fallen for the last four quarters. By historic standards, the UK is due another recession — defined as two consecutive quarters of negative GDP growth — and Brexit (and a global trade war) have merely heightened the risk.
“An already weak economy — too unbalanced, too unproductive and too unequal — now faces the threat of a painful rupture with its largest trading partner.”
“An investigation has been opened into anti-Semitic graffiti which appeared on the front of a bagel restaurant in central Paris at the weekend.
“The word ‘Juden’ (Jews in German) was sprayed in yellow on the front window of a restaurant belonging to the Balgestein chain on the touristy Ile Saint-Louis.”
“Matteo Salvini has raised the possibility of wresting control of Italy’s sizeable gold reserves away from the country’s central bank in the latest in a series of threats to the independence of the Bank of Italy by Rome’s populist coalition.
““The gold is the property of the Italian people, not of anyone else,” Mr Salvini, deputy prime minister and leader of the League party, said in comments to reporters on Monday.”
“Argentine President Mauricio Macri is fighting economic fires on all fronts.
“Rein in inflation and cuts to utility subsidies threaten to rekindle it while also fueling public anger; get a tumbling peso in check by jacking up interest only to find industrial output has hit an almost two-decade low.”
“Promises by Nigerian presidential candidates to fix an economy that vies with South Africa’s to be the continent’s largest could be unfulfilled unless the country is weaned off its oil dependence.
“President Muhammadu Buhari, 76, a former military ruler running for a second four-year term in this week’s vote, has struggled to jump-start the economy and far from lifting growth to the annual 10 percent he promised before the previous election, gross domestic product contracted in 2016.”
“Zimbabwe’s government was on Monday denied reports that it may introduce a new currency this week, amid fears that such a move would worsen the country’s economic crisis.
“Zimbabwe has been without a currency of its own since 2008 when the government ditched the infamous Zimbabwean dollar amid crippling hyperinflation. The highest denominated banknote was Z$100 trillion at the time.”
“Companies and executives around the world are desperately trying to gauge the severity of China’s economic slowdown. But getting a clear picture is very difficult…
“The situation could be even bleaker than China’s official statistics suggest, according to many analysts.”
“The collapse in China of a complex web of debt guarantees involving several private firms highlights risks in its financial system and opens up a potentially hazardous front for an economy in the grip of its slowest growth in nearly three decades.”
Singapore is very much a ‘canary in the coalmine’ for the global economy:
“Retail sales in Singapore fell by 6.0% on a year-on-year basis in December, worsening from the 2.4% decline in the previous month as sales from all segments in the index including motor vehicle sales and computer and telecommunications equipment fell except for medical goods and toiletries and other retail items.”
“Data out this morning show that home loans in Australia slumped by 6.1 per cent in December following a 0.9 per cent decline in the previous month.
“Not only was the drop far bigger than anyone predicted but on a quarterly basis is one of the biggest falls since the series began in 1975. Data of this magnitude was last seen during the 2008-2009 financial crisis.”
“The long-awaited earnings recession has finally arrived, but investors are still too optimistic and should anticipate more disappointment as the year drags on, according to Morgan Stanley.”
The deflationary spiral beckons:
“Global central banks may keep interest rates lower for longer… The world economy is set to get fresh insight into whether inflation is turning sluggish again as the U.S. and China publish price data that’s set to endorse the decision of central banks to steer away from tighter monetary policy… While China’s factory inflation reading on Friday will probably show a mere 0.3 percent increase from a year earlier, economists at Goldman Sachs Group Inc. expect a fall back into negative territory for the first time since 2016.”
“There is a significant chance the world economy is headed for a recession in 2019, according to Nobel Prize-winning economist Paul Krugman. Market participants are increasingly worried about the prospect of a serious economic downturn in the coming months, with a long-running U.S.-China trade war souring business and consumer sentiment.”