“U.S. Treasury Secretary Janet Yellen on Wednesday warned Congress that the United States risks a debt default and a new financial crisis as soon as the August recess if lawmakers fail to act quickly to suspend or raise the federal borrowing limit.
“In testimony to a Senate Appropriations subcommittee, Yellen said defaulting on U.S. debt obligations would be “unthinkable” and “would have absolutely catastrophic economic consequences.”“
[Tbh I have followed this annual drama for several years now and they always figure out a way because a US debt default would indeed have catastrophic consequences and most likely collapse the global financial system and who wants that, right? But in 2021 who knows!]
“Warnings of ‘big risk’ of inflation as UK government debt hits 99% of GDP: UK racks up another £24bn of borrowing in May with debt mountain hitting £2.2 trillion…
“The grim fiscal backdrop was highlighted as former chancellor Ken Clarke warned that there is a ‘big risk’ of inflation running out of control – and urged Mr Sunak to raise more revenue now…”
“‘The future is very scary’: Ireland’s Fishermen and women voice concerns for industry…
“In the Cork protest fishermen and women delivered a letter to Taoiseach Micheál Martin in which they called on the Government to protect their communities and secure the fishing industry for the future.”
“Denmark’s Top Central Banker Warns of a 2008-Style Housing Bust…
“After almost a decade of negative interest rates in Denmark — a world record — the country’s housing market now appears to have reached a tipping point, Lars Rohde said in an interview on Wednesday.”
“Germany’s finance ministry has come under fire over an attempt to secretly interfere with the questioning of a key witness during a parliamentary inquiry into Wirecard, a potential breach of parliamentary etiquette.
“The collapse of the once-highflying German payments company last summer sent shockwaves through Germany’s financial and political elite.”
https://www.ft.com/content/455ef57b-c3be-4c81-8c8c-7ac9585cf3fd
“Japan Flash PMI Indicates Further Economic Slowdown In June Amid COVID-19 Emergency And Supply Disruptions… Japan’s private sector shrank for a second straight month and at a faster pace in June.
“Manufacturing output notably slipped back into contraction after growing for four consecutive months while services output fell for the seventeenth month in a row.”
“South Korea’s financial vulnerabilities highest since 2008 financial crisis: Bank Of Korea.
“South Korea’s central bank said Monday that the country’s financial vulnerabilities had increased to their highest level since the 2008 financial crisis, calling for efforts to prevent a deepening of the financial imbalance caused by the heated real estate and digital asset markets.”
http://www.koreaherald.com/view.php?ud=20210622000827
“China’s Debt Reckoning Hammers ‘Too Big to Fail’ Borrowers.
“One of China’s most prolific debt issuers hasn’t sold a single dollar bond in 17 months… An investment grade-rated conglomerate mostly owned by the government is facing a cash crunch in a test of state support. Analysts …now say the notion of ‘too big to fail’ no longer applies in China as defaults this year exceed $23 billion, a record pace.”
“India’s Middle-Income Group Shrunk By 32 Million, 75 Million Pushed Into Poverty Due To Pandemic…
“South Asia, as a whole, is estimated to have experienced the most significant erosion in the middle class and a sharp rise in poverty due to the COVID-19 downturn. India’s dream of emulating China’s economic growth has taken a blow
“Child labor rises in Jordan as pandemic adds to economic woes…
“The unemployment rate in Jordan reached around 24 percent in the third quarter of 2020, up by 4.8 percent compared to the same period in 2019, according to official figures.”
https://www.arabnews.com/node/1882186/middle-east
“Lebanon again raises price of bread amid crippling crisis.
“Lebanon’s economy ministry on Tuesday raised the price of subsidized bread for the fifth time in a year as the country’s multiple crises worsen with no resolution in sight.”
“‘Everything is collapsing’: Colombia battles third Covid wave amid unrest…
“Colombia has reached the toughest point in the pandemic as the country is convulsed by unprecedented social upheaval and protests against economic inequality – which has only widened during the pandemic.”
“Lessons on urban agriculture and crisis management from Argentina.
“Climate change is causing the city of Rosario, Argentina, to heat up with rainfall become more and more erratic… The cities Urban Agriculture Program is helping to alleviate these issues by giveing low-income residents access to underutilized and abandoned public and private land to cultivate food.”
https://www.weforum.org/agenda/2021/06/rosario-argentina-urban-farming-economic-climate-crises/
“Climate adaptation requires billions in additional annual investments to prevent hunger…
“…annual global investments in agricultural research and development will need to increase by US $2 billion (or by 120%) between 2015 and 2050, according to a new study from researchers from the International Food Policy Research Institute.”
https://phys.org/news/2021-06-climate-requires-billions-additional-annual.html
“UN World Food Programme says 41 million on verge of famine.
“Some 41 million people in 43 countries are at imminent risk of famine, with nearly 600,000 others in four countries already experiencing famine-like conditions, the World Food Programme (WFP) has warned.”
https://www.aljazeera.com/news/2021/6/22/un-world-food-programme-says-41-million-on-verge-of-famine
“Wait Times for Chips Hit Record 18 Weeks as Shortage Deepens.
“Chip-starved industries from automakers to consumer electronics will need to wait a bit longer for components, as delays in filling orders continue to get worse.”
“Central banks step up fight against cryptocurrencies.
“Central banks have intensified their criticism of cryptocurrencies as battle over the monetary system escalates, arguing that digital tokens such as bitcoin have few redeeming features and “work against the public good”.”
https://www.ft.com/content/b6a3bf06-ad6b-4ab4-9ae3-15aca453f50d
“Downward spiral in liquidity is leading to more market shocks…
“Low liquidity means that the market now struggles to transfer risk efficiently from one participant to another. When an investor sells an asset, their sale can result in a price fall that triggers limits on trading positions known as ‘stop-losses’, forcing further sales. Lower liquidity, therefore, tends to amplify moves and exacerbate volatility.”
https://www.ft.com/content/82845ef0-28a5-4f92-b40a-c4c59e17bc27
You can read the previous ‘Economic’ thread here. I’ll be back tomorrow with a ‘Climate’ thread.
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