News this week dominated, of course, by the potential vaccine and Biden’s victory. This is certainly the most optimistic general sentiment has been since the pandemic began.

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The way things are shaping up, the Biden economy appears likely to show uncanny similarities to the 2011-to-2016 Obama economy.

Joe Biden will be inaugurated in January amid an economy that is likely to be slowly recovering from collapse. The Senate will probably be in the hands of Republicans — an opposition party perhaps willing to do enough to try to prevent steep damage to the economy and markets, but unwilling to embrace the kind of multi-trillion dollar spending agenda that could generate a Biden boom. This combination would mean that the Federal Reserve would be left playing the dominant role in trying to propel an economic recovery, with the downsides that would entail.

“Much about that forecast is uncertain.”

https://www.nytimes.com/2020/11/08/upshot/biden-economy-obama-comparison.html


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A smooth transition of power in the US is looking less likely with Donald Trump blocking co-operation with Joe Biden’s team and the US attorney general authorising investigations into allegations of electoral fraud.

“The Electoral College is scheduled to formally confirm Mr Biden’s victory on 14 December with the Democrat being sworn into office in late Jan.”

https://news.sky.com/story/us-election-2020-attorney-general-william-barr-approves-fraud-investigation-12128927


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“According to Freddie Mac, rates for a [US] 30-year, fixed-rate mortgage closed out the week at 2.78% which is down from 2.81% the week before.

This is the 12th time in 2020 that [US] mortgage interest rates have reached their lowest point in the nearly fifty years Freddie Mac has administered the weekly survey.”

https://www.forbes.com/sites/amydobson/2020/11/08/mortgage-interest-rates-drop-to-the-lowest-rates-yet/?sh=4f80d2e73654


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Climate change poses a bigger risk to the world than the coronavirus pandemic or the financial crisis, Andrew Bailey [Governor, Bank of England] has warned, ordering banks to act now to protect themselves and the economy.”

https://www.telegraph.co.uk/business/2020/11/09/climate-change-bigger-risk-covid-says-andrew-bailey/

Chancellor Rishi Sunak will on Monday outline plans to launch the UK’s first green gilts in an attempt to bolster the country’s low-carbon credentials.”

https://www.ft.com/content/54a81c62-bcf7-431b-81ac-63ad22637363


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[UK] Redundancies surged to record numbers in the three months to September as the Covid-19 crisis triggered a massive rise in the unemployment rate, official figures showed today

“The collapse in employment levels took place despite efforts by Chancellor Rishi Sunak to help employers keep staff with his furlough scheme and other support measures.”

https://www.standard.co.uk/business/unemployment-surges-as-covid19-hits-employers-despite-rishi-sunak-s-furlough-scheme-b62398.html


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UK Businesses are flocking to apply for lifeline cash in order to cope with the second national lockdown as banks face a fresh flood of loan applications.

“UK lenders have so far dished out more than £60bn under the Government’s coronavirus loan schemes… Lenders are concerned about keeping their reputations intact when the time comes to collect debts.”

https://www.telegraph.co.uk/business/2020/11/08/banks-creak-weight-demand-businesses-homebuyers-rush-loans/


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A new security bill that contains a clause seeking to ban footage identifying police officers that is ‘disseminated to harm’ has caused an almighty controversy in France

“…clause 24, which would criminalise all publishing of photos or videos where a police officer or gendarme could be recognised, if there is an “intent to harm”.”

https://www.thelocal.fr/20201109/france-proposes-bill-to-ban-photos-and-videos-that-identify-police-officers


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German police said demonstrators protesting coronavirus restrictions attacked them in the city of Leipzig Saturday…

“The crowd in the eastern German city was estimated to number around 20,000… Riots also broke out in Rome on Saturday.”

https://eutoday.net/news/politics/2020/riots-break-out


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Riot police with water cannons moved on Sunday to disperse protesters outside the central elections commission building in Georgia’s capital, Tbilisi. The marchers denounced last month’s election as rigged, and called for a new vote and the resignation of the commission chief Tamar Zhvania.

“The government rejected the demand.”

https://www.bloombergquint.com/onweb/georgia-riot-police-move-in-on-protests-against-election-results


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Zambia is doing everything possible to avoid a sovereign debt default later this week, including sharing information on its Chinese debt with holders of its dollar-denominated bonds, its finance minister told Reuters on Monday.

“Sources close to the main committee of bondholders, however, said little progress had been made in debt talks.”

https://uk.reuters.com/article/zambia-debt/exclusive-zambia-doing-everything-possible-to-avoid-looming-default-finance-minister-idUKL1N2HV1CW


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Turkey’s Finance Minister Berat Albayrak has resigned from his position allegedly due to the deterioration of his health, in a move that has shocked many in the country and leaves its economy even more uncertain.

“Albayrak… announced his resignation in an Instagram post last night… Despite claiming his resignation was for health reasons, it comes a day after Erdogan fired the central bank’s governor and replaced him with Naci Agbal, who was the finance minister prior to Albayrak.”

https://www.middleeastmonitor.com/20201109-turkey-fm-resigns-amid-economic-crisis/


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Voters in coronavirus-battered Jordan will head to the polls on Tuesday to elect a new parliament amid a deepening economic crisis worsened by the pandemic.

“With few resources and a high dependency on foreign aid, particularly from the IMF, members of the new parliament will have as their main goal the restructuring of the country’s debt, estimated at more than 100 percent of its GDP.”

https://www.aljazeera.com/news/2020/11/8/jordan-to-elect-new-parliament-amid-deepening-economic-crisis


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Riot police fired water cannon at crowds of Thai pro-democracy protesters as they attempted to reach Bangkok’s Grand Palace on Sunday to hand-deliver letters urging reform of the country’s powerful monarchy.

“Demonstrations have spread across Thailand in recent months, led by young people who have risked lengthy jail sentences…”

https://www.theguardian.com/world/2020/nov/08/police-fire-water-cannon-thai-pro-democracy-protesters


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China’s coal imports have dropped by 47 per cent in October compared with the corresponding period last year as trade tensions with Australia worsened.”

https://www.australianmining.com.au/news/china-coal-imports-almost-halve-year-over-year/

Peabody Energy, the world’s largest private sector coal producer, said there was a risk it could go bankrupt for the second time in five years, as it raced to renegotiate debts in the wake of tumbling demand for the fossil fuel.”

https://www.ft.com/content/7ef222f6-616c-4831-8193-9429f2ce9661


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Australian workers lost a total of $47bn in wages in the first eight months of the Covid-19 recession – the equivalent of $5,885 each when spread across the country

“Both men and women suffered cuts to hours and neither group has fully recovered, according to the longitudinal survey of more than 3,000 people.”

https://www.theguardian.com/australia-news/2020/nov/10/australian-workers-lost-47bn-in-wages-during-first-eight-months-of-covid-recession-study-says


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In the decade since the global financial crisis, there’s been a large build-up in sovereign debt by almost all Western nations… the COVID-19 pandemic has accelerated the trend.

At some point policymakers …face a difficult set of choices. Do they go down the path of deleveraging via fire (inflation) or ice (deflation)?

“…In an ideal world, the Royal Bank of Australia can lay up kindling around the barn, chip sparks at it, get a nice toasty campfire going, then dampen it down again at will. But as this country knows all too well, fires usually end up being much harder to put out than they are to start.”

https://www.afr.com/markets/equity-markets/beware-of-burning-down-the-barn-to-bury-the-debt-20201108-p56ci6


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The Reserve Bank of New Zealand’s growing dominance of its bond market is sparking unfavorable comparisons with Japan.

“The RBNZ’s ownership of the nation’s outstanding nominal government bonds has rocketed from 6% to 37% in the space of seven months, according to calculations by Bloomberg based on data from the central bank.”

https://ca.finance.yahoo.com/news/japanification-stalks-zealand-debt-37-013223619.html


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All eyes in the fintech world were trained on Ant Financial last week, after the Chinese group was dramatically blocked from launching its $37bn initial public offering at the eleventh hour. Theories abounded about the reasons: it was a political slapdown; there were technical shortcomings in the company’s prospectus disclosures.

An additional motive, though, is more fundamental. As Ant has morphed from a tech group that processes payments into a giant credit platform, it has become a potential systemic risk.”

https://www.ft.com/content/3bf4cec5-eabf-4d98-aed5-abee83837ad8


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Banks have been told that relying on a small number of external suppliers could put financial stability at risk, sounding a warning months after the collapse of German payments provider Wirecard had a knock-on effect on British fintech firms

“”A major disruption, outage or failure at one of these third parties could create a single point of failure with potential adverse consequences for financial stability and/or the safety and soundness of multiple financial institutions,” The Financial Stability Board said.”

https://www.telegraph.co.uk/business/2020/11/09/watchdog-warns-banks-reliance-external-suppliers/


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World leaders are running out of time to forge a green recovery from the Covid-19 crisis, with only a year to go before a crunch UN summit that will decide the future of the global climate, leading experts have warned.

“Progress on a green recovery, which would reduce emissions while repairing the damage from the pandemic, has been hampered by the need for an emergency rescue of stricken economies around the world.”

https://www.theguardian.com/environment/2020/nov/09/world-is-running-out-of-time-on-climate-experts-warn


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There is a risk of a new world war if current, smaller conflicts escalate out of control, drawing in more countries and weapons, the head of the UK armed forces has warned.

General Sir Nick Carter said the global economic crisis caused by the coronavirus pandemic could also trigger new security threats, even war.”

https://news.sky.com/story/risk-of-new-world-war-is-real-head-of-uk-armed-forces-warns-12126389


You can read the previous ‘Economic’ thread here and visit my Patreon page here. I’ll be back tomorrow with a ‘Climate’ thread.

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