“As spending climbs and revenue falls, the coronavirus forces a global reckoning:
“A rising ‘debt tsunami’ threatens even stable, peaceful middle-income countries… The pandemic is hurtling heavily leveraged nations into an economic danger zone, threatening to bankrupt the worst-affected.”
https://www.washingtonpost.com/world/2021/01/10/coronavirus-pandemic-debt-crisis/
“From Japan to the US, young people give up on finding jobs:
“Young people and former part-timers account for most of the labor market exiles. Worse, the young people among this group might also miss out on opportunities to gain the kind of work skills and experiences that further careers.”
“Derek Wood was about to achieve a lifelong dream [of making a living as a musician]. Unemployment benefits may prove to be his foil…
“His story shows how the US’s safety net for the jobless has broken down, and the intangible costs of the crisis.”
https://www.cnbc.com/2021/01/09/unemployment-how-benefits-may-have-killed-musicians-dream.html
“According to Eurostat Friday, unemployment rates slightly decreased in November in the euro area to 8.3 percent, but it is still rising sharply year-on-year due to the health crisis caused by the pandemic…
“However, young people are the most affected by the deterioration in the labor market, as the unemployment rate for those under the age of 25 rose in November to 18.4 percent (+0.4 points) in the euro area…”
https://en.royanews.tv/news/24703/Over-15-million-are-unemployed-in-EU–Eurostat
“Decision-time looms on EU budget rules as pandemic fallout grows: Positive developments for economy cannot mask long-term pain from soaring public debt.
“Faced with a Covid-induced economic disaster last year, EU member states fired every fiscal weapon they had… The question facing EU finance ministries in 2021 is what comes next.”
https://www.ft.com/content/53eb748e-743c-45a9-ae7d-dc140f988787
“Italy is considering a new stimulus package worth 24 billion euros ($29 billion) to support its healthcare system and its COVID-battered economy, Economy Minister Roberto Gualtieri said in a newspaper interview on Sunday.
“We’re considering a package worth 1.5% of our gross domestic product,” Gualtieri told Il Corriere della Sera daily newspaper.”
“The supply chain between Northern Ireland and the rest of the United Kingdom is a “boat breakdown” away from collapse as a result of the post-Brexit regulatory border, the UK’s Road Haulage Association has warned the British government.”
“There will be no spring recovery [for the UK. Chancellor Rishi] Sunak must prepare for a double-dip recession.”
“British minister Rishi Sunak expressed concern that higher interest rates might one day jack up the cost of servicing government debt, in comments published on Sunday.”
“Small UK businesses call for more support to face Covid impact: More than 250,000 companies at risk of collapse this year, quarterly FSB survey suggests.”
https://www.ft.com/content/f0193dc7-9215-4979-a85e-b93149317535
“Councils across England are facing having to make unprecedented cuts to services in the coming years, after coronavirus left them with multimillion-pound black holes in their funding.
“Early intervention and prevention projects for vulnerable families, as well as recycling schemes, are among the cutbacks most likely to be in the firing line as local authorities seek to claw back cash to avoid meltdown. And council taxpayers will be asked to stump up more…”
“[South Africa’s] Eskom Holdings SOC Ltd. is unprepared for maintenance work at Africa’s sole nuclear power plant after a steam generator leak brought forward a planned shutdown at one of the 1,800-megawatt facility’s two units…
“The shutdown, which Eskom said will last until May, will sap its ability to meet national demand. The state-run company that supplies almost all of South Africa’s power has instituted intermittent power outages across major cities since 2008 because it can’t supply the electricity the country needs. Last year was the worst on record for power cuts in the country.”
“Pakistan’s national power grid has experienced a major breakdown, leaving millions of people in darkness, government officials have said.
“”A countrywide blackout has been caused by a sudden plunge in the frequency in the power transmission system,” Power Minister Omar Ayub Khan said on Twitter.”
“Syria’s petroleum ministry on Sunday blamed U.S. sanctions for forcing it to cut by up to 24% its distribution of fuel and diesel because of delays in arrival of needed supplies.
“The war-ravaged nation already is facing a severe economic crisis that has caused major shortages in wheat and fuel products. Long lines have formed outside of gas stations and bakeries.”
“A policeman was killed Sunday in Iraq, the army said, as security forces fired to disperse a third consecutive day of protests in the city of Nasiriyah, according to medics…
“Witnesses said security forces opened fire to disperse demonstrators — including some throwing stones — from a city square that served as an epicentre of a widespread protest movement that began in 2019.
https://www.france24.com/en/live-news/20210110-iraqi-policeman-shot-dozens-wounded-in-protests
“Iran’s capture of a South Korean-flagged tanker at sea last week has been described by the US as extortion. But Tehran says it is Seoul that is the hostage taker — accusing it of holding $7bn of its cash.
“Just weeks before US president-elect Joe Biden is due to take office, the Islamic regime engaged in two moves seen as highly provocative by the west.”
https://www.ft.com/content/3549c3bc-0c7a-4b17-b45d-5acd83aad176
“U.S. sanctions aimed at stopping oil sales have battered Iran’s economy, which has been shrinking since 2018. By disrupting the Hormuz strait, Iran shows it has the power to hit back at the U.S. and drive up crude.
“Any boost in the price of oil also helps make up for the revenue Iran is losing due to the sanctions.”
“Hundreds of thousands of Taiwanese enterprises are bidding farewell to China because of rising costs and trade tensions between Washington and Beijing, marking a dramatic shift for Taiwan’s corporate landscape with significant implications for global manufacturing.
““I see a structural collapse among the ranks of Taiwanese-owned businesses in China,” said Liu Jen, editor in chief at CRIF China…”
https://www.ft.com/content/5b78a04d-e51d-45d8-b276-2bbf9b11bed2
“Ship owners facing looming deadlines to use less-polluting fuels have slashed the number of new vessels on order because they don’t know which alternative technology to switch to.
“Ammonia, hydrogen, biofuels and electrification are some of the many contenders to power the world’s future merchant fleet, but most are only in the trial stage and won’t be scalable for at least a decade. With the life of a commercial ship averaging around 20 years, opting for a technology that doesn’t take off could be very costly.
“But owners are running out of time to make the choice.”
“The global economy could be on the brink of a new commodity “supercycle” as governments prepare to use a green industrial revolution to kickstart growth following the coronavirus pandemic…
““Things like copper, nickel and cobalt are all likely to see a boost from the extra demand to build infrastructure. Even steel and petrochemicals will be needed,” said Chris Midgeley, the head of analytics at S&P Global Platts.”
[If this is “green” then what does “green” even mean?]
“Are we on the cusp of a global solvency crisis? …2020 has been characterised by a sweeping wave of corporate deterioration, which in turn has triggered widespread credit downgrades and even defaults in many instances…
“…as social-distancing measures and economic contractions persist, levels of corporate-default risk were expected to “exceed those of the 2008 financial crisis”.”
https://internationalbanker.com/finance/are-we-on-the-cusp-of-a-global-solvency-crisis/
“Is ‘hysterical’ market speculation pushing us towards another crash?
“Despite Covid, global stocks started 2021 on a high. But some analysts warn of an ‘epic’ bubble, amid fears that the flow of stimulus has created a monster.”
“On various measures, there are reasons to be fearful. The graph below shows that the US stock market is as expensive as it was on the eve of the 1929 Wall Street Crash…”
You can read the previous ‘Economic’ thread here. I’ll be back tomorrow with a ‘Climate’ thread.
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