“The coronavirus pandemic has left some of the world’s biggest shipping lines facing mounting backlogs and delays, straining international supply chains and threatening to disrupt global trade.
“Staff illness and quarantining, social distancing measures, lockdowns that affect factories’ output patterns and soaring consumer demand for goods moved by sea have all combined to place severe pressure on the container shipping industry, the backbone of globalised trade, according to its operators.
“Lars Jensen, chief planner of services for Maersk Line, the world’s biggest container ship operator, said there was a “perfect storm” created by a mix of rising demand and reduced capacity in logistics systems.
““There’s congestion in terminals,” said Mr Jensen, Maersk Line’s head of network.
““There’s a shortage of truck drivers because some have not been able to drive. Particularly out of Asia, we see a part of that is linked also to the fact that a lot of companies are restocking.”
“As a result “productivity slows down”, which “delays more ships, then we get a vicious circle”, Mr Jensen said.”
https://www.ft.com/content/eb21056b-5773-422a-ab78-92e59cddc1b5
“Covid-19 Is Creating a New Kind of Financial Midlife Crisis:
“Covid-19 has disrupted professional trajectories, forcing people to focus on other areas of life — perhaps for the first time in years… The conditions created by the pandemic are putting people to the test.”
“Economists fear that low-wage [US] service workers face a devastating winter as the latest surge of Covid-19 shutdowns keep shoppers and diners home once again.
“As more states move to shut down or limit crowds in shopping centres, restaurants and gyms, workers in retail and food service industries are positioned to repeat the mass job cuts in the spring.”
https://www.ft.com/content/2a2324bd-ceb6-4844-9dd3-073ca493f73e
“Deal or no deal, millions of jobless Americans stand to lose aid lifeline:
“Even if lawmakers enact an extension of emergency unemployment programs ahead of the Dec. 31 cut-off, lags in programming for antiquated state systems will still cause missed checks for the scores who rely on them.”
https://www.politico.com/news/2020/12/11/coronavirus-relief-unemployment-444645
“The pandemic is pummeling New York City’s commercial real estate industry, one of its main economic engines, threatening the future of the nation’s largest business districts as well as the city’s finances.”
https://www.nytimes.com/2020/12/11/nyregion/nyc-commercial-real-estate.html
“The other day, I noted that the occupancy rate of the iconic wrinkled-appearing “New York by Gehry” tower with 899 apartments in Manhattan had plunged from 98% in 2019 to 74% by September.
“This plunge in occupancy rate was the reason the $550 million loan, the only asset backing a “private-label” CMBS, had been put on the “servicers watchlist.”
“The ratio of household debt to disposable income in Canada rebounded in the third quarter as borrowing increased, while a key metric of financial pressure also ticked back up.
“Household credit market debt rose to 170.7% of disposable income on a seasonably adjusted basis in the third quarter, from a revised 162.8% previously.”
“The government is facing growing pressure to take action at the UK’s gridlocked container ports, as the looming Brexit deadline is also resulting in thousands of extra truckloads of goods heading to the Channel ports in France, causing delays and traffic queues.
“The delays radiating out from major container ports… are now being felt acutely in a number of industries.”
“Armed Royal Navy boats are being prepared to patrol the UK’s fishing waters in an apparent final warning shot to Brussels as negotiations enter the final 48 hours.
“Four of the 80-metre vessels are on standby to guard British waters from EU fishermen in case no deal is agreed on fishing rights after the Brexit transition period ends on 31 December.”
“The ECB adds another half trillion in QE, even as Italy eyes debt cancellation on the last batch:
“The central bank is in effect holding the fort through the worst of the crisis and shielding vulnerable states from markets until late 2021.”
“Italy is seizing on the torrent of stimulus in Europe to push its mountain of debt payments further into the future.
“Since the onset of the pandemic in March, the nation’s Treasury has extended the maturity on its debt stock by about a year…”
“In Europe, investors are starting to say their goodbyes to the region’s bond market, worried that soon there may not be any place left for them.
“Collapsing trading volumes are a worrying sign for the market’s future, the chief investment officer for Axa Investment Managers wrote in a recent note to clients titled “Bye Bye Bunds,” a reference to the German bonds that serve as the benchmark for Europe. The culprit? The European Central Bank, which this year has taken its purchases of debt to unprecedented levels. By the end of 2021, investors will be even more squeezed out.”
“China’s regional economies are under growing pressure to meet debt repayments after a years-long spending spree, as trillions of yuan worth of credit is set to mature next year, according to analysts.”
“Global debt has expanded at an unprecedented pace this year as a result of the Covid-19 pandemic. China and the United States are the biggest contributors to the rapid debt accumulation respectively among emerging markets and developed economies.
“Their heavy exposure needs to be addressed if the so-called debt tsunami doesn’t overwhelm the world economy…”
“The world’s stockpile of negative-yielding debt has swelled to a fresh record in a sign that demand for havens is just as intense as that for riskier assets.
“The market value of the Bloomberg Barclays Global Negative Yielding Debt Index rose to $18.04 trillion on Thursday, the highest level ever recorded.”
“Cuba said late on Thursday it would scrap its dual currency and labyrinthine multiple exchange rate system in January, effectively devaluing the peso heavily to administer bitter medicine for its crisis stricken economy…
“The devaluation comes amid Cuba’s worst economic crisis since the collapse of former benefactor the Soviet Union…”
“Decades of failed policy and reform drives that have amounted to little more than kicking the can down the road are catching up with the Algerian economy, as the dinar hit a new low this week and experts heralded more pain to come…
“The decline of Algeria’s currency continues apace.”
https://www.middleeasteye.net/news/algeria-dinar-record-low-economic-collapse
“Markets are showing mounting concern about Sri Lanka’s ability to manage debt loads, amid financial deterioration that sparked a downgrade deeper into junk Friday…
“Prices of the country’s dollar bonds show that traders …are increasingly uneasy about dwindling cash reserves for debt bills down the line.”
“”Yemen is teetering on the edge of complete collapse,” says UNICEF Executive Director Henrietta Fore…
“”Over 80 percent of people require urgent humanitarian assistance and protection. Including 12 million children, whose lives are a waking nightmare.””
You can read the previous ‘Economic’ thread here. I’ll be back on Monday with a ‘Climate’ thread.
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