“Talk of a global economic reset must not ignore grim realities:
“The pandemic has greatly intensified existing inequality. In the US this winter, millions face unemployment and destitution. The social crisis in Europe, so far contained by furlough schemes and emergency loans, is only just beginning. Businesses in their tens of thousands have gone under.
“Not only is Brexit likely to cause more chaos in January, but national lockdowns around the world have thrown the global trading system out of sync. Mountains of containers are piled up in the wrong places. In the poorest parts of the world hundreds of millions face intensifying hunger. And supervening all that is the largest surge in public debt since the war.
“We cannot count on rapid growth to help us pay that debt. Nor will inflation come to our rescue to eat away at its real value. Europe, like Japan before it, lives under the shadow of deflation.”
https://www.ft.com/content/5834df03-d8d4-456a-b08f-fa2ee0203141
“The chasm between the haves and the have-nots, combined with racial discrimination, in America were placed under greater scrutiny in 2020, as the COVID-19 pandemic raged…
“But as stock market indexes staged a huge rebound from the lows seen in March when the pandemic first hit, the gap between the wealthy and the poor extended an already widening trend to historic proportions.”
“First, they lost their jobs to the coronavirus pandemic, and now many of the more than 20 million people unemployed in the United States may lose something else: the government aid keeping them afloat through the world’s worst Covid-19 outbreak…
“But for many of the jobless, lawmakers’ months of dithering — along with the indifference of the overstretched US unemployment systems — have already taken a toll.”
“…millions of US families struggling with COVID-19’s economic turmoil are seeking help—many for the first time—with everything from meal baskets to presents under the Christmas tree.
“The Salvation Army is projecting 6.6 million people will come to them for support, up from 2.6 million on a regular holiday season…”
https://news.yahoo.com/hungry-holidays-amid-covid-recession-113307464.html
“A flood of mail and online holiday purchases is overwhelming the U.S. shipping system. An estimated 6 million packages a day are being left stranded…
“”Our entire industry is underwater because of the demand,” said Satish Jindel, president of ShipMatrix.”
https://www.cbsnews.com/news/usps-shipping-delays-ups-fedex-holiday-packages/
“UK Postal unions have described the Christmas delivery chaos as a “nightmare” after businesses complained parcels were taking up to a month to arrive.
“Fears are growing that presents will be missing on Christmas Day as last-minute shoppers rush online and are forced to rely on overstretched delivery services.”
“Queues at Dover [UK] reached 20 miles today with long traffic jams in Calais through the night as thousands of lorries – many full of Christmas gifts and food – tried to cross the Channel amid chaos at Britain’s container ports…
“A container of goods from China to Felixstowe is now at $10,000 (£7,500) per load – four times the usual rate.”
“BMW’s Mini Plant is preparing its supply chain ahead of Brexit:
“The company, alongside many others, had ordered extra car parts to stockpile in preparation for a no-deal Brexit, but this had led to delays at the UK’s ports where they goods were being sorted.”
https://www.oxfordmail.co.uk/news/18954442.bmws-mini-plant-preparing-supply-chain-ahead-brexit/
“Volkswagen says it’s facing a massive parts shortage that’s causing production slowdowns at factories in China, Europe and North America:
“Volkswagen said Thursday it was facing production slowdowns due to a “massive” supply bottleneck caused by a shortage of semiconductor components for car electronics as global automobile markets bounce back from the pandemic sales slump.”
“Europe’s politicians need to stop any talk of the European Central Bank cancelling debt it buys as part of its asset purchase schemes, ECB board member Isabel Schnabel said on Thursday.
““A cancellation of national debts would constitute a clear violation of the European Treaties,” Schnabel said in a Twitter Q&A. “The debate is harmful and should be stopped.””
“Thirty-five European Union lenders analysed by the bloc’s banking watchdog didn’t hold enough easy-to-sell US dollar assets to cover their projected dollar cash outflows as of end-June.”
“Japan has sold 80 tons of gold used for minting coins to another arm of the government to fund part of its huge stimulus package to combat the coronavirus crisis, government officials told Reuters.
“Saddled with public debt twice the size of its economy and tax revenues hit by the pandemic-induced recession, the finance ministry is under pressure to find non-tax revenues to cover the rising cost of spending…”
https://japantoday.com/category/business/Japan-sells-gold-to-fund-part-of-its-stimulus-package
“Japan’s core consumer prices dropped in November at their fastest pace in a decade as the coronavirus pandemic hit demand, stoking fears of a return to deflation and wiping out the benefits former premier Shinzo Abe’s stimulus policies.”
“The role of China’s social safety net programme, known as dibao, has shifted over time from providing support to the poor and vulnerable to being used partly as a tool to repress dissent, according to research from a US-based social scientist…
“”…there’s a comprehensive management of public security [and] dibao is then used very specifically to control individuals.””
“At least 25 people have died, several of them due to the biting cold weather, during the three-week protest by farmers on the Indian capital’s borders, police said, as Prime Minister Narendra Modi offers to “very humbly” hold further talks with the protesting farmers…
“…at least 25 farmers have died since November 26 when tens of thousands of farmers began demonstrations against three farm laws passed by the government.”
https://www.aljazeera.com/news/2020/12/18/several-indian-farmers-dead-in-protests-against-farm-laws
“Saudi Arabia’s economy shrinks for fifth consecutive quarter…
“The world’s largest oil exporter is facing a dual crisis this year as the pandemic and lower energy prices strain its finances and the private sector.”
“Algerian President Abdelmadjid Tebboune’s first appearance since being hospitalised in Germany with COVID-19 in October was intended to reassure the country…
“But on the streets of Algiers people voiced growing impatience after the five-minute video message he gave…
“The major energy producer has been in turmoil since early last year when mass protests pushed the old president Abdelaziz Bouteflika from power…”
“In February, Libya will mark ten years of the ouster of the Gaddafi regime. The people have nothing to celebrate as the country is still mired in chaos and the United Nations is still grasping at straws to reach a political breakthrough to end the suffering.
“The Libyans traded the ouster of the regime for chaos in a country that is now a failed state.”
“Dying for a better life: On board Lebanon’s ‘death caravans’ to Europe:
“Desperation is driving hundreds of Lebanese and Syrians to risk everything to reach Cyprus by boat, but the journey is fraught with danger – and many won’t survive.”
“Ninety percent of Syrian refugees in Lebanon now live under the extreme poverty line, the United Nations has said, after an economic collapse in the country and the pandemic pushed hundreds of thousands to the brink.
“That is nearly double the extreme poverty rate the UN recorded last year…”
“I expect there will be certain areas in the US (and in the world) where people just can no longer live, as a result of drought, sea rise, wildfire, or flood.
“This realignment has the potential to be very unfair to people with poor access to capital and poor access to information (while beneficial to those with capital and data).”
https://hbr.org/2020/12/are-we-on-the-verge-of-another-financial-crisis
““The story we are basically telling ourselves is that the economy is this perpetual motion machine where you can just push a button in a central bank somewhere, and no matter what kind of economic challenges you are facing in the real economy, you can just wash that away with the creation of nominal money,” says Claus Vistesen, chief eurozone economist at Pantheon Macroeconomics.”
“Bitcoin continued to break new ground on Thursday, briefly rising past $23,000 (£16,202)…
“Thursday’s early price action marked the second new all-time high in as many days for bitcoin.”
https://uk.finance.yahoo.com/news/bitcoin-record-high-17-december-22000-092659055.html
“The global economy’s worst year since World War II is ending on a bleak note for millions of people — despite the prospects of a rebound that a coronavirus vaccine could offer.
“In the past week, data revealed how the crisis is reaping a debilitating toll on Americans’ savings, while also destroying hundreds of thousands of U.K. jobs, particularly in the hospitality industry.”
You can read the previous ‘Economic’ thread here. I’ll be back on Monday with a ‘Climate’ thread.
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