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Markets Are No Longer Worried About Inflation… The bad news is they are now fretting about the post-pandemic recovery

“The good news, if the market is to be believed, is that we can forget about the inflation scare. The bad news is that it might also be time to abandon hopes for a strong reopening and economic recovery from the pandemic…

“Two key bond market measures are now below their mean for the last decade (a period when for most of the time deflation was a greater concern than inflation).”

https://www.bloomberg.com/opinion/articles/2021-07-20/bond-market-says-forget-inflation-scare-worry-about-growth


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Chip Shortage Reaches Smartphone Makers… Shipments are slowing and prices are rising as companies hunt for parts; supply-chain wait times enter the danger zone…

“…customers are seeing their first significant price increases in years. Some companies have had to scale back production and delay new releases.”

https://www.wsj.com/articles/chip-shortage-reaches-smartphone-makers-11626695523


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Taco Bell is hit with nationwide ingredient shortages a week after Popeyes announced it’s been hoarding chicken as food industry struggles to catch up after the pandemic.

“…the US food industry is struggling to keep up with newly reopened restaurants, sports arenas and food halls. At Taco Bell, a message posted atop the company’s website the company apologized for its slimmed down menu.”

https://www.dailymail.co.uk/news/article-9806245/Taco-Bell-hit-nationwide-ingredient-shortages-industry-grapples-supply-constraints.html


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‘There are possibilities everywhere’: US workers demand a better deal. Labour shortages have given employees the upper hand in negotiations with companies

“companies are desperate to hire staff as continuing fears about the pandemic, a lack of childcare, and a temporary expansion of unemployment benefits have kept many workers on the sidelines.”

https://www.ft.com/content/a6501b83-79c8-479a-8f5d-bd240ccc6194


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Future flooding threat could overwhelm complacent UK banks. A Danish bank is warning lenders that the climate crisis must be considered in their long-term plans…

“Nationalbank has become so alarmed it has produced a series of warnings about the stability of its financial system. It says that long-term lending, 20 to 30 years, needs to take into account the climate crisis…”

https://www.theguardian.com/news/2021/jul/20/future-flooding-threat-could-overwhelm-complacent-uk-banks


Floods in Germany
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Wobblier eurozone banks most exposed to climate change

“The eurozone’s weaker-capitalised and less profitable banks are the most exposed to credit defaults stemming from climate change, according to a joint report from the European Central Bank (ECB) and European Systemic Risk Board (ESRB).”

https://www.risk.net/risk-quantum/7856326/wobblier-eurozone-banks-most-exposed-to-climate-change


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Hunger strike by illegal immigrants threatens to topple Belgium’s government

“A two-month hunger strike by illegal immigrants threatened to topple Belgium’s federal government on Monday as several ministers said they would resign if there were deaths.”

https://www.telegraph.co.uk/world-news/2021/07/19/hunger-strike-illegal-immigrants-threatens-topple-belgian-government/


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‘They just left us’: Greece is accused of setting migrants adrift at sea.

“Turkey and Greece have been at loggerheads over how to deal with the continuing flow of migrants along one of the most frequented routes used since the mass movement boomed in 2015.”

https://indianexpress.com/article/world/they-just-left-us-greece-is-accused-of-setting-migrants-adrift-at-sea-7411697/


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Health expert warns Tokyo Olympic bubble has burst as Covid-19 cases linked to the Games rise to 71..

“Kenji Shibuya, the former director of the Institute for Population Health at King’s College London, told Reuters: “It’s obvious that the bubble system is kind of broken.”

https://www.standard.co.uk/sport/sport-olympics/olympic-bubble-covid19-ioc-tokyo-olympics-b946632.html


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Investor doubts over China Evergrande Group intensified on Monday as a creditor’s successful demand to freeze some assets underscored concern that the embattled developer may struggle to raise funds.

“The company’s shares plummeted 16% to close at a four-year low in Hong Kong, while its listed electric vehicle unit sank 19%. Some of Evergrande’s local bonds fell to record lows.”

https://nz.finance.yahoo.com/news/evergrande-shares-bonds-slump-unit-022737268.html


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As China’s debt risks grow, here are 3 warning signs to watch.

“Weak spots are emerging in China’s growing debt pile. National debt levels have climbed to nearly four times of GDP, while an increasing number of corporate bonds have defaulted in the last 18 months.”

https://www.cnbc.com/2021/07/21/as-china-debt-risks-grow-here-are-3-warning-signs-to-watch.html


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North Koreans Alarmed by Starvation Deaths of Well-Off Ethnic Chinese.

“The starvation deaths of three ethnic Chinese residents of North Korea, who were cut off from their economic lifeline to China by a border closure to fight the coronavirus pandemic, has shocked North Koreans by showing that the economy is failing even privileged groups…”

https://www.rfa.org/english/news/korea/hwagyo-07202021220452.html


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Myanmar Lost 1.2 Million Jobs After Coup, UN Labor Agency Says

“Myanmar lost an estimated 1.2 million jobs in the second quarter following the February military takeover that paralyzed an economy already weakened by the coronavirus pandemic, according to the International Labor Organization.”

https://www.bloomberg.com/news/articles/2021-07-20/myanmar-loses-1-2-million-jobs-after-coup-un-labor-agency-says


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Employment woes in Brazil to continue for “nine years,” says World Bank.

“A World Bank report forecasts that the economic crisis caused by Covid-19 will cause negative effects on employment and salaries in Brazil for the next nine years, suggesting that full recovery will only come in 2031.”

https://brazilian.report/liveblog/2021/07/20/employment-woes-in-brazil-to-continue-for-nine-years-says-world-bank/


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Peru’s new president must appease markets to rescue economy.

“Peru’s newly-elected president, leftist trade unionist Pedro Castillo, faces an uphill battle building the market confidence he needs to address a deep economic crisis in a country battered by the coronavirus epidemic, analysts say.”

https://today.rtl.lu/news/world/a/1758911.html


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Colombia tries to keep lid on unrest with milder tax reform plan

“The government introduced the first plan in April but the backlash against it was so fierce that President Iván Duque had to withdraw it within days. The finance minister who drew it up, Alberto Carrasquilla, resigned.”

https://www.ft.com/content/218c0354-51fa-4b18-a940-137de7e3b3de


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‘A powder keg about to explode’: Long marginalized Afro Cubans at forefront of island’s unrest…

““It’s a powder keg about to explode when you have a regime that refuses to recognize that there are large communities with economic, housing, material and food deprivation,” said Guillermo “El Coco” Fariñas, a prominent Black dissident.”

https://www.washingtonpost.com/world/2021/07/19/cuba-protests-afro-cubans/


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Services on brink of collapse at NW municipalities [South Africa]

“…This is according to the MEC for Finance, Motlalepula Rosho. She says the municipal audit outcomes show that over half of municipalities’ financial systems and governance and financial information are deficient.”

https://www.ofm.co.za/article/centralsa/306186/services-on-brink-of-collapse-at-nw-municipalities


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Madagascar is on the brink of a famine it played little part in creating. The kéré – which roughly translates as famine in Malagasy – has become frequent in the south, especially during prolonged lean seasons, when agricultural production is low due to a lack of rain.

“The problem Madagascar is facing today is that the kéré arrived in certain locations as early 2017 and has never left.”

https://www.itv.com/news/2021-07-20/madagascar-is-on-the-brink-of-a-famine-it-played-little-part-in-creating


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10 years after Somalia famine, country is once again on the brink of crisis with women and girls hardest hit

“Since the 2011 famine, funding in Somalia has steadily decreased from $1,386.8 million in 2011 to the current $558.2 million*. According to the UN, if funding is not increased, hunger will continue to rise…”

https://reliefweb.int/report/somalia/10-years-after-somalia-famine-country-once-again-brink-crisis-women-and-girls-hardest


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Domestic violence, forced marriage, have risen in Sudan.

“Deteriorating economic conditions since 2020 and the COVID-19 pandemic have fuelled an increase in domestic violence and forced marriage in Sudan, a UN-backed study has revealed.”

https://moderndiplomacy.eu/2021/07/20/domestic-violence-forced-marriage-have-risen-in-sudan/


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Tunisia health minister sacked as virus cases soar

“Mehdi’s sacking is another instance of instability in a government that has seen several ministers resign over tensions with parliament and the presidency… Tunisians have lived through a decade of political turmoil and economic crisis since their 2011 revolution…”

https://www.france24.com/en/live-news/20210720-tunisia-health-minister-sacked-as-virus-cases-soar


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Crisis-hit Libya faces lean Eid as livestock prices spiral

“The guns may have fallen silent in the North African country, but its people are now fighting a deep economic crisis worsened by the Covid pandemic and drought. Few customers were stopping in the days before Eid at the Sidi Khalifa roadside market outside Benghazi…”

https://today.rtl.lu/news/world/a/1758120.html


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In crisis-hit Lebanon, celebrating Eid is for the ‘happy few’.

“Lebanon’s ever-spiralling economic crisis, political instability and shortages of basic necessities mean celebrating Eid has become a luxury only a select few can afford.”

https://www.aljazeera.com/economy/2021/7/19/lebanon-celebrating-eid-is-for-happy-few


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Yemen: UK cuts in humanitarian aid funding leaves families fearful for future.

“For Abdulwaez Sufian, who lives in a displaced persons’ camp in Yemen’s Taiz, the news that the UK is cutting its humanitarian aid budget has left him fearful that reductions in basic services provided by aid organisations could leave him unable to feed his family.”

https://www.middleeasteye.net/news/yemen-uk-humanitarian-aid-funding-cuts-war-consequences


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No Herd Immunity For Poverty

“Covid’s medium to long term effects on global extreme poverty are …gut-wrenching… The World Bank estimated that more than 150 million will be forced into extreme poverty as a result of the pandemic. This represents by far the biggest blow to the world’s poor since rates of extreme poverty began to decline in the 1990s.”

https://www.forbes.com/sites/globalcitizen/2021/07/19/no-herd-immunity-for-poverty/?sh=76c1c8a34247


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More Than a Third of Earth’s Population Faces Malnutrition Due to Covid

“As many as 3 billion people may be unable to afford a healthy diet due to the pandemic, according to a study published in Nature Food journal. This will exacerbate maternal and child under-nutrition in low- and middle-income countries, causing stunting, wasting, mortality and maternal anemia.”

https://www.bloomberg.com/news/articles/2021-07-19/more-than-a-third-of-earth-s-population-faces-covid-malnutrition


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Insurers are falling short in tackling climate risk, warns top policy adviser.

“Insurers have not gone far enough in overhauling their underwriting practices to respond to climate change, with US groups the furthest behind, according to the head of a joint initiative between the industry, World Bank and UN.”

https://www.ft.com/content/dbf28018-7e96-4a3b-bb12-637b98056c94


You can read the previous ‘Economic’ thread here. I’ll be back tomorrow with a ‘Climate’ thread.

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