“Global wages have fallen in real terms this year for the first time since comparable records began, the International Labour Organization said on Wednesday, arguing there was scant evidence of pay pressures stoking inflation.
“The UN agency’s annual report on pay showed that global monthly average wages in the first half of 2022 were 0.9 per cent lower in real terms than a year earlier, marking the first outright fall in worldwide living standards in the 15 years for which the ILO has published data.”
https://www.ft.com/content/3e46958a-3b51-4bc9-959d-61650589c17e
“UN warns of social unrest after ‘striking’ drop in global wages…
“ILO Director-General Gilbert F Houngbo said the deterioration in real wages would likely continue without targeted policy responses by governments. “This would increase the probability of a deeper recession… “This in turn would endanger the economic and employment recovery, further increasing inequalities and fuelling social unrest,” said Houngbo.”
“OECD: Energy Crisis Weighing Heavily on Global Economic Growth.
“The effects of the energy crisis will be felt on a global scale in 2023… The recently released World Economic Outlook, the flagship annual report from the Organization of Economic Cooperation and Development (OECD) paints a grim picture for the months and years to come as the world grapples with an unfolding global crisis the likes of which we’ve never seen.”
“IMF and WTO leaders warn don’t ‘pull the plug’ on global trade…
“IMF Managing Director Kristalina Georgieva, speaking after a meeting with German Chancellor Olaf Scholz, said globalization was facing its biggest challenge since World War Two in the wake of the COVID-19 pandemic and Russia’s war in Ukraine.”
https://www.reuters.com/business/imfs-georgieva-wto-leader-dont-pull-plug-global-trade-2022-11-29/
“More Americans tapping buy now, pay later for holiday gifts shows ‘how stressed the economy is,’ Harvard researcher says…
“On Black Friday through Cyber Monday, buy now, pay later payments through companies such as Klarna, Zip, Zilch, Affirm and Afterpay jumped 85% compared with the week before, according to the most recent data from Adobe. Buy now, pay later revenue rose 88% for the same period.”
https://www.cnbc.com/2022/11/30/buy-now-pay-later-for-holiday-gifts-is-horrible-harvard-fellow.html
“UK consumers face ‘bleak’ winter as food inflation hits new high.
“Annual growth of UK food prices rose strongly to 12.4 per cent in November, up from 11.6 per cent in October, the British Retail Consortium said on Wednesday… Responding to the figures, BRC chief executive Helen Dickinson said: “Winter looks increasingly bleak as pressures on prices continue unabated.””
https://www.ft.com/content/c0992ca9-0a5f-4264-b122-654086e8cb75
“Britain is to be disrupted by strikes every day until Christmas as trade unions seek to bring the country to a halt in a new winter of discontent.
“Rail workers, including staff at Eurostar, nurses, teachers, security guards handling cash, driving examiners and rural payments officers are planning industrial action that will affect every day over advent.”
“Only now are the true costs of [the UK’s] quantitative easing making themselves felt – all £200bn of them…
“With the return of inflation, the interest rate on reserves has risen above that of the average in the Bank’s £847bn holding of government bonds. Having banked and spent the previous profits, governments are now being forced to finance the consequent losses. Already the costs are biting hard.”
“UK bond markets are still recovering from the shock of the upheaval that followed the Truss government’s “mini-Budget”, the Governor of the Bank of England, Andrew Bailey, has said.
““We’ve obviously had a period of severe ill-liquidity in the gilt market and it’s not back to normal at the moment,” Mr Bailey told the House of Lords Economic Affairs Committee.”
“The next financial crisis is brewing in the UK’s corporate debt market…
“…the UK’s shadow banking system poses an ongoing and material risk to our financial stability, with speculation and poor practice stoked by the rock-bottom interest rates of the past 14 years. But as interest rates rise at an eye-popping pace it is likely that the next financial crisis is being incubated in the UK’s multibillion-pound corporate debt market.”
“Power cuts could affect emergency calls in France this winter – Orange CEO.
“Emergency phone calls may not be possible in parts of France if there are prolonged power cuts this winter, CEO of the country’s No. 1 telecoms operator Orange said on Wednesday, as the prospect of energy rationing looms amid the war in Ukraine. The stark warning from Christel Heydemann contrasts with the French government’s reassuring tone on the matter…”
“‘Necessary evil’: France refires coal plant amid energy woes…
“The energy crisis across Europe unleashed by Russia’s war in Ukraine has paved the way for coal’s comeback in some regions, to the dismay of politicians and activists who warn this endangers climate goals, the climate itself and public health.”
“Germany’s Largest State Declares Emergency Amid Energy Crisis…
“North Rhine-Westphalia (NRW), home to 20 of the 50 largest German companies, declared an “extraordinary emergency situation” to be able to access more loans which would otherwise be denied to the state because of a rule on how much debt a state can borrow, German broadcaster WDR reports.”
“Ukraine war: Germans struggle with influx of Ukrainian refugees.
“…as winter deepens and Russia continues to attack Ukraine’s energy infrastructure, authorities here are hastily preparing more emergency shelters… A million Ukrainians have fled to Germany since the start of the war, according to latest figures.”
https://www.bbc.co.uk/news/world-europe-63792498
“Europe Remains Russia’s Biggest Diesel Buyer.
“Europe continues to be the biggest buyer of Russian diesel… The still high dependence on Russian diesel could become a big problem for Europe in just two months, when the EU embargo on imports of Russian oil products by sea enters into force on February 5.”
https://oilprice.com/Energy/Energy-General/Europe-Remains-Russias-Biggest-Diesel-Buyer.html
“EU Is Hooked on Russia LNG and Paying Billions to Keep It Coming.
“Liquefied natural gas imports from Russia are up about 40% in a year as buyers scramble to replace dwindling piped flows. It’s a bitter pill for many across the bloc, which has slapped heavy sanctions on the Kremlin to starve it of funds fueling the war in Ukraine.”
“‘A form of self-destruction’: Japan weighs up plan to expand nuclear power…
“In a sweeping change to the country’s energy policy, the prime minister, Fumio Kishida, has announced plans to build next-generation reactors and restart those left idle after the 2011 triple meltdown, in an attempt to end Japan’s dependence on imported fossil fuels and help meet its net zero target by 2050.”
“Bank of Japan’s $5 Trillion Bet Is Going Awry in a Hurry…
“As of the end of September, the BOJ was at least $6.3 billion in the red on its massive stockpile of Japanese government bonds. This is the first time in the Kuroda era that began in March 2013 that the BOJ announced a loss on assets it’s been hoarding. That, not surprisingly, has investors wondering the extent to which the BOJ’s stock purchases, via exchange-traded funds, might be under water, too.”
“[South Korea] Truckers’ strike triggers fuel shortage.
“A nationwide strike by the country’s unionized truckers is causing some local petrol stations to run out of gasoline and diesel, according to the energy ministry, Wednesday, prompting owners of cars and buses to brace for a full-fledged fuel shortage next week.”
https://www.koreatimes.co.kr/www/tech/2022/12/419_340878.html
“Asia’s Manufacturing Slumps as Factories Brace for Worst.
“Asia’s factories struggled in November as they contended with higher costs, weakening regional currencies and cooling global demand, and the pressure is set to continue in the months ahead. Manufacturers across the region are cutting back on output and jobs…”
“China’s high youth unemployment stokes student Covid protests…
“Young people in China, who were at the heart of a nationwide wave of demonstrations after a fatal fire in the western city of Urumqi was blamed on a lockdown, face a bleak economic outlook. Youth unemployment this year touched its highest level on record. China’s broader economy is now at one of its weakest junctures in many years.”
https://www.ft.com/content/7d286faf-dccd-453a-a413-470babc7f1cc
“China Home Sales Slump Persists Even as Rescue Efforts Mount…
“The 100 biggest real estate developers saw new-home sales drop 25.5% from a year earlier to 559 billion yuan ($78.9 billion) in November, according to preliminary data from China Real Estate Information Corp. That narrowed from a 28% decline in October.”
“Record Power Outages Risk South Africa’s Financial Stability, Central Bank Warns…
“Sustained load shedding, as the outages are called in South Africa, impacts negatively on domestic economic growth, investor sentiment and business activity, exacerbating other pre-existing vulnerabilities, the South Africa Reserve Bank said in its latest financial stability review.”
“Are South Africans on the verge of a mental blackout? Our country seems to be on a verge of two types of blackouts, one with the electricity grid, and one with the people of South Africa shutting down from stress.
“With load shedding, rising costs and end of year fatigue, Bloomberg said that many South Africans were feeling frustrated and overwhelmed, with nowhere to direct their anger… adrenal fatigue, which is caused by consistent stress, can lead to a complete shutdown from being so mentally and physically drained.”
https://www.capetalk.co.za/articles/460841/are-south-africans-on-the-verge-of-a-mental-blackout
“Nigeria’s fuel crisis worsens as shortages spread nationwide…
“”The pumps are dry, most filling stations are shut,’’ Mr Alade Joseph, a petroleum unionist said on Wednesday in Abuja as scarcity takes its toll on residents, including those in the seat of government, Abuja, where a fuel black market thrives.”
https://www.theeastafrican.co.ke/tea/rest-of-africa/nigeria-fuel-shortage-worsens-4039242
“Syria steps up fuel rationing as shortages hit mobile network.
“Prime Minister Hussein Arnous ordered a 40% reduction in the amount of fuel provided to government workers and restrictions on official travel for non-urgent purposes, according to a statement. Public transport was exempted, said the statement…”
“Crypto Lenders’ Woes Worsen as Bitcoin Miners Struggle to Repay Debt.
“Miners, who raised as much as $4 billion from mining-equipment financing when profit margins were as high as 90%, are defaulting on loans and sending hundreds of thousands of machines that served as collateral back to lenders.”
“The crypto winter claims Bitfront exchange as its latest casualty.
“Bitfront, a crypto exchange backed by Japanese social media app Line, is shutting down after failing to overcome turmoil in the industry. The announcement by the US-based exchange comes at a time when the market for digital assets is grappling with financial contagion unleashed by the spectacular collapse of another crypto exchange, FTX.”
https://edition.cnn.com/2022/11/29/business/bitfront-line-crypto-exchange-hnk-intl/index.html
You can read the previous “Economic” thread here. I’ll be back tomorrow with a “Climate” thread.
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