Daily updates on climate change and the global economy.

Daily updates on climate change and the global economy.
Stay current with what’s happening around the world with a quick scan of top news.

Daily updates on climate change and the global economy.
Stay current with what’s happening around the world with a quick scan of top news.

Daily updates on climate change and the global economy.
Stay current with what’s happening around the world with a quick scan of top news.

Daily updates on climate change and the global economy.
Stay current with what’s happening around the world with a quick scan of top news.

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“A historic global bond-market crash threatens the liquidation of world’s most crowded trades, says Bank of America…

“‘If the bond market does not function, then no other market functions, really,’ say Ben Emons of Medley Global Advisors.

“Government bonds have racked up losses of 20% this year, as of Thursday — the worst losses since 1920, according to BofA.

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“For all of 2022, global government bonds are on course for one of their worst performances since the Treaty of Versailles, which was signed in 1919 and went into effect in 1920 — establishing the terms for peace at the end of World War I.

“Yields and bond prices move in opposite directions, so rising yields reflect the sinking prices on government debt.”

https://www.marketwatch.com/story/a-historic-global-bond-market-crash-threatens-the-liquidation-of-worlds-most-crowded-trades-says-bofa-11663953563


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Unprecedented events creating ‘extremely severe’ risk of global recession – economist Adam Tooze…

The chances of a global recession were now “extremely severe”, as central banks in many parts of the world raise interest rates to curb inflation. “It’s the single most dramatic simultaneous tightening of monetary policy ever,” Tooze said.”

https://www.theguardian.com/business/2022/sep/23/unprecedented-events-creating-extremely-severe-risk-of-global-recession-economist-adam-tooze


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Dow Plunges 500 Points: Bear Market Returns as Goldman Warns Recession Would Hit Stocks Harder.

“Stocks closed at their lowest level in more than a year on Friday as a growing number of investment analysts released grim projections for markets and the economy this year, with some arguing major indexes will plunge deeper into negative territory as the Federal Reserve tees up a more aggressive policy to fight inflation.”

https://www.forbes.com/sites/jonathanponciano/2022/09/23/dow-plunges-500-points-bear-market-returns-as-goldman-warns-recession-would-hit-stocks-harder


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Recession will be necessary to rebalance the oil market.

Restoring spare capacity to more comfortable levels will require a business-cycle downturn, which is why a recession or at least a serious slowdown is inevitable… Recessions in 1974, 1980, 2008 and 2020 all left oil production and consumption on a permanently lower trajectory than before.”

https://www.reuters.com/markets/asia/recession-will-be-necessary-rebalance-oil-market-kemp-2022-09-22/


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DEJA VU?

“As each time I publish this chart, it goes without saying that past performance doesn’t guarantee future returns.

“But, jeez, the 2007-08 and the 2021-22 Brent price charts have, so far, a spooky similarity!”

https://twitter.com/JavierBlas/status/1573323871649931265


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It’s Every Nation for Itself as Dollar Batters Global Currencies…

“While the problems… right now are in many ways reminiscent of the 1980s, the solutions are unlikely to be. Back then, the world’s economic superpowers agreed to tackle in unison the problem of persistent dollar strength, coming to an agreement in 1985 with the Plaza Accord. This time around, there’s little sign such a pact will be forthcoming as national economic interests diverge and the multi-decade shift toward greater global integration is thrown into reverse.

https://www.bloomberg.com/news/articles/2022-09-22/almighty-dollar-runs-rampant-in-an-increasingly-divided-world


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A comprehensive gauge on the health of the US economy dropped in August for the sixth straight month, reinforcing concerns about a possible recession.

“The Conference Board said Thursday that its Leading Economic Index for the United States dipped last month. The index, which tracks a range of metrics capturing activity in the jobs market, manufacturing, financial markets and housing, is designed to detect when recessions are coming.”

https://edition.cnn.com/2022/09/22/economy/conference-board-recession-signal/index.html


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Police in Iceland have arrested four men on suspicion of planning terror attacks on public buildings, including the country’s parliament, national broadcaster RUV reports.

Officers are exploring potential links to Nordic far-right groups and the police were the central target, local media has reported.”

https://news.sky.com/story/four-men-arrested-on-suspicion-of-planning-terror-attacks-in-iceland-12703740


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Sweden’s right-wing bloc ‘agreed on stricter migration policy’: report.

“The four parties backing Moderate Party leader Ulf Kristersson to become Sweden’s next Prime Minister have already agreed on stricter migration and crime policies, a source has told the Aftonbladet newspaper.”

https://www.thelocal.se/20220921/swedens-election-winning-parties-agreed-on-stricter-migration-policy/


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Muslim-Hindu tensions have been rising for months, say residents [Leicester, UK], fuelled by social media and police inaction

“Tensions boiled over last weekend, with violent unrest erupting on to the streets. People armed with sticks and bats carried out assaults, missiles and fireworks were thrown, police were injured, cars were smashed…”

https://www.theguardian.com/uk-news/2022/sep/23/how-communal-unrest-flared-leicester-muslim-hindu-tensions


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Britain’s new vision leaves onlookers with nightmares.

Britain’s new economic agenda represents the biggest gamble for growth in a major Western democracy in at least 40 years, for which the chance of success fell instantly as investors ditched sterling assets… Investors reacted with dismay to the combination of free spending, unfunded tax cuts and huge increases in government borrowing announced by finance minister Kwasi Kwarteng on Friday.”

https://www.reuters.com/markets/europe/britains-new-vision-leaves-onlookers-with-nightmares-2022-09-23/


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The UK Is Really Trading Like an Emerging Market Right Now [Except, unfortunately, we are a debt-bloated *receding* market with no future of robust growth; unable to cope with significantly higher interest rates.]

“It is extremely unusual for a developed market currency to weaken at the same time as yields are rising sharply,” wrote George Saravelos, Deutsche Bank AG strategist, in a note to clients. “But, this is exactly what has happened since the new Chancellor’s announcement. We worry that investor confidence in the UK’s external sustainability is being eroded fast.”

https://www.bloomberg.com/news/articles/2022-09-23/the-uk-is-really-trading-like-an-emerging-market-right-now


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Banking and financial firms in London are closely studying and updating contingency electricity supply plans to protect themselves and their customers in case power outages hit the UK this winter.

“Some banks are discussing the idea of again encouraging the work-from-home policies from previous Covid lockdowns or using offsite locations, representatives of the trade association UK Finance, coordinating the talks, told Bloomberg.”

https://oilprice.com/Latest-Energy-News/World-News/London-Banks-Prepare-For-Possible-Blackouts.html


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Estonian Premier Warns of Blackouts if Russia Cuts Grid Access.

Estonian Prime Minister Kaja Kallas warned that Russia could be preparing to disconnect the three Baltic countries from its electricity grid, leading to potential blackouts amid a broader energy crisis. The warning came as Russia delayed plans on Saturday to test the connection between its main power network with its Kaliningrad exclave…”

https://www.bloomberg.com/news/articles/2022-09-23/estonian-premier-warns-of-blackouts-if-russia-cuts-grid-access


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Energy crisis leaves Germany’s toilet paper makers struggling to clean up.

“Making a single 2-metre-wide “mother roll” of toilet paper at Germany’s Essity plant in Mainz-Kostheim, where the Main river meets the Rhine, uses 700 kilowatt-hours of natural gas — enough to heat a family home for several weeks during the winter… “At [the current gas] price level, it will mean an automatic deindustrialisation for Germany…”

https://www.ft.com/content/3fa477c0-73a1-4054-b791-7c9a281697e2


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VW may shift output from Germany over gas shortage.

“Volkswagen Group could shift production out of Germany and eastern Europe if a shortage of natural gas persists, the latest sign that the energy crisis unleashed by Russia’s invasion of Ukraine threatens to shake up Europe’s industrial landscape.”

https://europe.autonews.com/automakers/vw-may-shift-output-germany-over-gas-shortage


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Mercedes races threat of gas rationing by making extra parts.

“Mercedes-Benz is stockpiling parts it makes using natural gas in a move to keep production going for several weeks even if Germany introduces drastic fuel rationing… This will allow carmaking operations in Alabama and Beijing to keep going even if a shortage of natural gas in Germany forces operations in the country offline.”

https://europe.autonews.com/automakers/mercedes-races-threat-gas-rationing-making-extra-parts


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Energy crisis will have ‘disastrous’ impact on European recycling ambitions…

“As a major running cost of plastic recycling facilities, with plants running 24 hours, seven days a week, energy utilities usually equate to 15 to 20 per cent of total operational costs. Following a 400 per cent increase in energy prices, they now look to represent up to 70 per cent of operational costs.”

https://resource.co/article/energy-crisis-will-have-disastrous-impact-european-recycling-ambitions


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European Steel makers fear deepening crisis from energy crunch as output halted…

“GENK, Belgium (Reuters) – Spiralling energy costs have forced steel makers to cut output across Europe, threatening mass plant shutdowns some warn could be permanent in a sector that employs more than 300,000 and contributes tens of billions of euros to the region’s economy.”

https://uk.investing.com/news/stock-market-news/steel-makers-fear-deepening-crisis-from-energy-crunch-as-output-halted-2760135


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Euro-Zone Consumer Sentiment Hits Record Low on Energy Woes.

“Euro-area consumer confidence slumped to its lowest level on record as households brace for a winter energy crunch and a further acceleration of already soaring inflation… Confidence gauge declines to -28.8; economists expected -25.5.”

https://www.bloomberg.com/news/articles/2022-09-22/euro-zone-consumer-sentiment-hits-record-low-on-energy-crisis


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Eurozone downturn deepens in September as price pressures intensify.

“The Eurozone economic downturn deepened in September, with business activity contracting for a third consecutive month, according to preliminary survey data. Forward-looking indicators, such as new order inflows, backlogs of work and future output expectations, point to the decline gathering further momentum in coming months.”

https://ihsmarkit.com/research-analysis/eurozone-downturn-deepens-in-september-as-price-pressures-intensify-Sep22.html


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Europe’s vegetable farmers warn of shortages as energy crisis bites.

“Across northern and western Europe, vegetable producers are contemplating halting their activities because of the financial hit from Europe’s energy crisis, further threatening food supplies… Surging power and gas prices will impact crops grown through the winter in heated greenhouses…”

https://www.reuters.com/world/europe/europes-vegetable-farmers-warn-shortages-energy-crisis-bites-2022-09-22/


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China cuts soybean mix for feed to shore up national food security

“In a move to lower animal feeding costs, maintain food inflation at a manageable rate and protect national soybean reserves, the Chinese government is calling for farmers to cut their soybean use and opt for feeding alternatives such as nutrition enriching amino acids.”

https://www.foodingredientsfirst.com/news/china-cuts-soybean-mix-for-feed-to-shore-up-national-food-security.html


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[India’s] Rupee Closes at Its Weakest Ever After Hitting a New All-Time Low of Over 81 Per Dollar.

“The rupee breached 81 per dollar for the first time ever on Friday before recovering to under that level as the Reserve Bank of India intervened but still ended the day at its weakest level as the dollar powered ahead to a new 20-year high.”

https://www.ndtv.com/business/rupee-recovers-to-under-81-per-dollar-but-still-ends-at-its-weakest-ever-3370826


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Pakistan PM says ‘all hell will break loose’ without debt relief…

“In an interview with Bloomberg TV on Friday morning, Sharif sought a moratorium on Pakistan’s debt repayment from the Paris Club (a group of rich creditor countries) and others, saying there is a “yawning gap” between what is being asked for and what is available.”

https://www.aljazeera.com/news/2022/9/23/pakistan-pm-says-all-hell-will-break-loose-without-debt-relief


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Death toll from Iran unrest climbs to 31 as protests spread…

““The people of Iran have come to the streets to achieve their fundamental rights and human dignity… and the government is responding to their peaceful protest with bullets,” Iran Human Rights (IHR) director Mahmood Amiry-Moghaddam said in a statement, publishing a toll after six days of protests.”

https://www.thehindu.com/news/international/many-killed-as-iran-protests-spread-over-mahsa-aminis-death/article65922366.ece?homepage=true


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Banks in Lebanon will remain shut indefinitely after the country’s banking association said a spate of bank heists had made opening branches too dangerous.

“The banking association’s statement was issued on Wednesday evening, before banks were scheduled to reopen on Thursday after a three-day shutdown.”

https://www.aljazeera.com/news/2022/9/22/lebanon-banks-will-remain-shut-indefinitely-after-heists


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Scores dead in worst sinking of migrant boat from Lebanon in recent years…

The country, which has been mired since 2019 in a financial crisis the World Bank has described as one of the worst in modern times, has become a launchpad for migration, with its own citizens joining Syrian and Palestinian refugees clamouring to leave the country.

https://www.theguardian.com/world/2022/sep/23/scores-dead-in-worst-sinking-of-migrant-boat-from-lebanon-in-recent-years


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Syria still risks economic collapse, says UN envoy… Geir Pedersen, the UN special envoy for Syria, says that the country faces a ‘crisis of epic proportions for the Syrian people.’

“Syria, once at the top of the global agenda, now competes for attention with an array of global crises, including climate, the war in Ukraine, and its impact on food and global energy security.”

https://www.al-monitor.com/originals/2022/09/syria-still-risks-economic-collapse-says-un-envoy#ixzz7fn7P66We


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Living in darkness: How South Africa’s blackout is affecting lives.

“If it is dark at the Mfusis it’s because of power cuts. The South African family of five now has to enter power cut mode; meaning: rely on battery torches and candles. The state-owned power utility is implementing scheduled blackouts. and sometimes gives just a few hours notice. Life has become a rush for the Soweto residents.”

https://www.africanews.com/2022/09/22/south-africa-life-during-the-blackout


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Thousands of young people have staged a coordinated “global climate strike” across Asia, Africa and Europe in a call for reparations for those worst affected by climate breakdown.

“From New Zealand and Japan to Germany and the Democratic Republic of Congo, activists walked out of schools, universities and jobs to demand rich countries pay for the damage global heating is inflicting on the poor.”

https://www.theguardian.com/environment/2022/sep/23/thousands-call-for-climate-reparations-and-justice-in-global-protests


You can read the previous “Economic” thread here. I’ll be back on Monday with a “Climate” thread.

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