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“Most of us are dreading the credit card bills in January after a Christmas shopping spree, but it (probably) won’t reach $188 trillion.

“As the festive holiday approaches, the International Monetary Fund is thinking about debt and whether the world is vulnerable to another recession.

“Commenting on the latest figures from its global debt database, the IMF warned that “many countries may be ill-prepared for the next downturn”.”

https://www.telegraph.co.uk/business/2019/12/19/want-christmas-188-trillion-debt-pile/


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Clearly there are worrying signs about global growth. Large parts of Europe and Japan have essentially stalled. Growth in China is the weakest in nearly three decades. The trade war between China and the United States helped slow U.S. growth from above 3 percent last year to near 2 percent this year.

“More broadly, there are mounting doubts about the ability of political and economic leaders to deal with a recession.”

https://www.theepochtimes.com/is-canada-entering-a-recession_3175375.html


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“On a Friday afternoon in November, the long story of the global economic crisis reached a milestone: More than a decade after the fact, a court convicted senior executives from major banks for crisis-era crimes. …

“They’d been convicted of hiding them. The cover-up wasn’t just worse than the crime. It was the crime.”

https://www.bloomberg.com/news/articles/2019-12-19/wall-street-magic-tricks-make-banks-look-safer-than-they-are


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Investors don’t think the Federal Reserve is being straight with them, according to a survey published Wednesday by RBC Capital Markets…

“”I want to emphasize that growth of our balance sheet should in no way be confused with the large-scale asset purchase program that we deployed after the financial crisis,” Fed Chairman Jerome Powell said in October.”

https://www.marketwatch.com/story/most-stock-investors-think-the-fed-has-restarted-emergency-stimulus-despite-denials-says-rbc-survey-2019-12-18


This decade’s surge in corporate debt could pressure stocks in 2020 as corporate earnings slow to a crawl, hurting the ability of companies to timely repay that debt and keep the solid credit ratings that allow them to borrow so cheaply, according to a theory laid out by UBS strategist Francois Trahan.”

https://www.cnbc.com/2019/12/18/a-10-trillion-debt-burden-coming-due-one-day-could-hit-the-stock-market-and-amazon-ubs-proposes.html


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The [shale] slowdown is starting to hit the local and regional economy in West Texas

“A recent Dallas Fed survey said that Texas on the whole could lose 8,100 jobs in the oil and gas sector, double what the bank thought previously. Median home prices in the Permian have slid 2.6 percent since August.”

https://oilprice.com/Energy/Energy-General/Texas-Is-Already-Feeling-The-Shale-Slowdown.html


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Wednesday marked two months since anti-government protests against structural inequality began in Chile.

“Government officials are advancing a variety of measures in response to the demands of demonstrators, but protests are expected to continue as are crackdowns and alleged abuses by security forces.”

https://www.aljazeera.com/news/2019/12/chile-protests-2-months-ready-continue-191218150734536.html


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Bolivia’s attorney general’s office ordered the arrest of exiled former president Evo Morales on Wednesday following the interim government’s accusation of sedition and terrorism.

“Public prosecutors in La Paz signed an order for police to detain the 60-year-old and take him to the attorney general’s office.”

https://www.france24.com/en/20191218-bolivia-prosecutors-order-arrest-of-ex-president-evo-morales-in-exile-in-argentina


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Europe will probably see an increase in rates of corporate defaults in 2020 as credit quality deteriorates. Moody’s expects the rate of defaulting junk-rated issuers to triple, pushing the figure above the long-term average after an extraordinarily quiet year…

“The lack of defaults belies the increase in negative rating actions and deterioration in credit quality…”

https://www.globalcapital.com/article/b1jj12mtdhyztf/default-rate-to-rise-in-europe-next-year-after-eerily-quiet-2019


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Police detained hundreds of people in New Delhi and southern city of Bengaluru on Thursday and shut down the internet in some places as protests entered a second week over a new citizenship law that critics say undermines India’s secular constitution.”

https://www.reuters.com/article/us-india-citizenship-protests/hundreds-detained-in-india-for-defying-ban-on-protests-against-citizenship-law-idUSKBN1YN0KJ


India is facing a “Great Slowdown” with its economy headed for intensive care unit primarily due to a “second wave” of the twin balance sheet crisis at banks, former Chief Economic Adviser Arvind Subramanian has said.”

https://www.thehindubusinessline.com/economy/indian-economy-is-facing-a-great-slowdown/article30340782.ece#


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Hong Kong’s exports will shrink by a further 2 per cent in 2020, the second year in a row of contraction following a 4 per cent fall in 2019…

“…according to the latest forecast by the city’s trade development body.”

https://www.scmp.com/news/hong-kong/hong-kong-economy/article/3042693/hong-kong-exports-shrink-2-cent-2020-second


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China’s phase one deal with the United States will neither lead to balanced trade nor end a broad rivalry between the two countries, according to an influential Chinese researcher… ““It won’t be [fixed] as quick as five to 10 years,” Fan added.”

https://www.scmp.com/economy/china-economy/article/3042757/trade-war-china-us-tensions-will-persist-despite-phase-one


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Brace for more defaults by China state-owned businesses, analysts warn. A huge bond default by a large state-owned business spooked investors last week, prompting experts to question if it’s a sign that Chinese government bailouts may be dwindling.”

https://www.cnbc.com/2019/12/19/investing-china-state-owned-firms-could-see-more-defaults-fewer-bailouts.html


A top adviser to China’s central bank has warned of a possible “chain reaction” of defaults among the country’s thousands of local government financing vehicles…”

https://www.ft.com/content/be52259a-2163-11ea-92da-f0c92e957a96


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“Faced with sluggish demand for durable goods, firms scaled back industrial production. Global trade—which is intensive in durable final goods and the components used to produce them—slowed to a standstill

“Central banks reacted aggressively to the weaker activity… These policies averted a deeper slowdown…”

https://blogs.imf.org/2019/12/18/2019-in-review-the-global-economy-explained-in-5-charts/


Economies across the world are suffering and experts believe that if the situation does not improve then we may be heading towards a global recession in the coming year.”

https://www.maschinenmarkt.international/english/global/articles/892254/


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The Bank of England has launched one of the most ambitious attempts to date to quantify the risk that climate change poses to the financial system.

“Bank officials told journalists that the value of every asset on the face of the planet will be affected by climate change. Where values change, there is financial risk and the bank wants to measure it – and then manage it.”

Good luck with that, Bank of England!

https://www.bbc.co.uk/news/business-50836228


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