“Global manufacturing indicators point to a slump in demand for goods at levels comparable to the 2008 financial crisis, as China’s economy sputters and consumer spending shifts toward services…
“Some observers see monetary tightening by central banks mainly in advanced economies playing a role. Large-scale easing during the pandemic sent asset prices soaring and drove overconsumption, while the accelerating rate hikes that followed created a credit crunch that dragged down demand.
“Meanwhile, demand in the massive Chinese market has been weaker than anticipated. Official data for June showed dollar-denominated imports down from the previous month and falling on the year for a fourth consecutive month.”
https://asia.nikkei.com/Economy/Demand-slump-drags-global-manufacturing-to-financial-crisis-levels
“China slides into deflation sparking fears for global economy…
“The figures come amid mounting fears China is entering an era of much slower economic growth akin to the period of Japanâs âlost decadesâ since the 1990s, which saw consumer prices and wages stagnate for a generation. On Tuesday, China revealed poor import and export data.”
“Chinaâs Country Garden misses bond payments as turmoil grips property sector.
“An official default would be a blow for an industry that typically drives more than a quarter of Chinaâs total economic activity, but which has been paralysed by construction delays, declining home sales and a lack of funding.”
https://www.ft.com/content/93601476-0c7a-452a-af33-6cc0153acac7
“Rare protests against Chinese authorities erupted in several cities as people demanded compensation for losing their homes in a government release of flood water.
“Nearly one million people in the northern Hebei province were relocated after record rains forced authorities to channel water from swollen rivers to some populated areas for storage.”
https://www.telegraph.co.uk/world-news/2023/08/08/watch-china-protests-flood-water-destroys-homes/
“Moodyâs downgrades 10 regional banks as crisis pressures persist [US]…
“Credit rating agency Moodyâs Investors Service downgraded 10 regional banks and put six other lenders on notice that they are under review, the latest blow to an industry still reverberating from the March banking crisis that led three firms to collapse.”
https://www.washingtonpost.com/business/2023/08/08/moodys-banks-downgrade/
“Consumer debt climbs as American credit card balances surpass $1 trillion.
“Consumer debt grew $17.9 billion from May to June as a credit crunch brought on by Federal Reserve rate hikes drove a sharp gain in the amount of outstanding credit for payments like mortgages and car loans. The numbers, which are not adjusted for inflation, come in well ahead of expectations at $13 billion…”
https://thehill.com/homenews/4142302-consumer-debt-climbs-as-credit-card-debt-surpasses-1-trillion/
“New Lending by Mortgage REITs Has Dried Up… Blackstone Mortgage Trust and KKR Real Estate Finance Trust halt loan origination to shore up balance sheets…
“Default rates are rising for all lenders because higher interest rates are making it tougher for many borrowers to refinance and many properties, especially office buildings, are suffering higher vacancy rates.”
https://www.wsj.com/articles/new-lending-by-mortgage-reits-has-dried-up-49551878
“Oil hedge funds place their bets on heat-fueled hurricane season…
“Bullish gasoline positions have hit their highest since the day Russia invaded Ukraine and will almost certainly rise further if record Atlantic Ocean heat draws a hurricane into the Gulf of Mexico and disrupts refineries, investors and analysts said.”
“OPEC+ crude production at lowest since August 2021 on Saudi cut…
“The latest Saudi cut as well as disruptions in Kazakhstan and Nigeria more than offset gains in Iran and Iraq, contributing to an almost 1 million b/d fall in OPEC+ output month on month.”
“Oil cuts see Saudi Arabia enter âtechnical recessionâ…
“Capital Economics wrote: âWith the Kingdomâs voluntary 1m barrels per day oil output cut set to be extended at this weekâs OPEC+ meeting, there is a growing possibility that the economy contracts this year as a whole.â”
“Why OPEC+ Will Do Whatever It Can To Send Oil Prices Higher.
“…the U.S. and its core allies see rising oil and gas prices (historically the price of gas is 70 percent derived from the price of oil) as serious economic and political threats to them, given that they are generally major net importers of energy.”
“Wind Industry Hits Rough Seas as Problems Mount…
“In recent weeks, at least 10 offshore projects totaling around $33 billion in planned spending have been delayed or otherwise hit the doldrums across the U.S. and Europe… âIf the soundest projects in the most mature markets start to sink, that is a major red flag,â said Peter Lloyd-Williams, a senior analyst at Westwood Global Energy Group.”
https://www.wsj.com/articles/wind-industry-hits-rough-seas-as-problems-mount-5490403a
“Europeâs renewable energy push is destined for ruin…
“To say that the world is on the brink of a transition away from fossil fuels is simply not true. A glance at the data shows that, at best, renewables can slow down the growth of energy produced from traditional sources. Elimination is another matter entirely.”
https://unherd.com/thepost/europes-renewable-energy-push-is-destined-for-ruin/
“Italian banks hit with surprise windfall tax.
“Italy has passed a one-off 40% tax on the profits banks earn from higher interest rates, in a shock move that has seen shares plummet. A hike in official interest rates has resulted in record profits for Italian banks, prompting the government’s move.”
https://www.bbc.co.uk/news/world-europe-66440335
“Return of âstagflationâ haunts the UK.
“The National Institute of Economic and Social Research (NIESR) said the economy had suffered from five years of âlost economic growthâ, with stubbornly high inflation and semi-permanent government deficits expected in the foreseeable future.”
https://www.thetimes.co.uk/article/return-of-stagflation-haunts-the-uk-npjjsqkfv
“Higher food prices may be here to stay, the Bank of England’s chief economist has said.
“Huw Pill said that the rate at which food prices are rising was expected to slow to “about 10% by the end of the year”. But he warned a return to cheaper food was “something we may not be seeing for a while yet, if in the future at all”.”
https://www.bbc.co.uk/news/business-66433014
“Economic turmoil and spiraling prices: Just how bad is poverty in Turkey?
…”âI have been working on poverty for 22 years, but I have never seen such a bad situation,â says Hacer Foggo, a Poverty Solidarity Office Coordinator for the Republican People’s Party… âPeople cannot meet their basic needs,â Foggo told Euronews. âThis in turn is causing anxiety, depression and isolating families.â”
“Tunisian bakers stage protest against ban on subsidised flour…
“Demonstrators who rallied around him held up signs that read: “bread, freedom, national dignity,” and “thousands of employees will be laid off”. “The people you see here today have not been able to carry out their regular activity, which is the production of bread,” Jamali said.”
“Sudan at risk of disease as corpses litter streets…
“War-torn Sudan is at risk of major disease outbreaks, with thousands of unburied corpses remaining out in the open and the country’s health and sanitation infrastructure destroyed, Save the Children warned Tuesday. Residents say Khartoum is littered with dead bodies from fighting…”
https://www.newarab.com/news/sudan-risk-disease-corpses-litter-streets-charity
“The police could trigger another unrest in Nigeria [picture from 2020 unrest].
“Given the current economic troubles in the country, it is not out of place to say that we could face social unrest in the near future. But what would be the spark? …I would say that the police ranks very high on the list of possible causative factors.”
https://businessday.ng/columnist/article/the-police-could-trigger-another-unrest-in-nigeria/
“2 people are fatally shot on a fifth day of protests in the South African city of Cape Town…
“The unrest on the outskirts of South Africa’s second-largest city followed an announcement last Thursday of a weeklong strike by minibus taxi drivers, who are angered at what they call heavy-handed tactics by police and city authorities in impounding some of their vehicles.”
https://abcnews.go.com/Business/wireStory/2-people-fatally-shot-day-protests-south-african-102070614
“South Africa’s mining output has fallen further below pre-pandemic levels due to persistent electricity outages and rail disruptions, industry data shows, threatening dividend payouts to investors.
“South Africa is the world’s biggest producer of platinum and chrome and a leading producer of gold and diamonds. But the industry has been shrinking for years as ore grades decline…”
“Cubaâs economic crisis is worse than after fall of the Soviet Union, economists warn…
“Cuba, which for decades was one of the largest exporters of sugar in the world, now has to import sugar to meet its domestic demand. Six decades after the Cuban Revolution, the country is again undergoing a severe economic crisis, this time worse than the infamous âSpecial Periodâ in the 1990s…”
https://www.miamiherald.com/news/nation-world/world/americas/cuba/article278068487.html
“Haiti Rocked By Violent Protests Over Rising Gang Violence.
“Haiti has witnessed violent protest against the rising gang violence in the country. Thousands of people demonstrated in the streets, burnt tyres, attacked vehicles, and clashed with the police. Daily lives of people have been disrupted by incessant gang violence that has worsened poverty across the country.”
“Climate change hurts global economy: 59 countries will face massive debt burden in next 10 years.
“Researchers warn of potential credit score downgrades for major players like China, India, the United States, and Canada. The implications are dire, with higher borrowing costs for nations translating into increased corporate debt. The economic damage caused by climate change is already evident…”
“Looming insurance crisis could make the GFC âlook like a picnicâ…
“For all those who deny climate change is real, who argue its financial costs are minor, or who actually believe it could benefit the world, the expensive reality is being played out in all those envelopes being mailed out to insurance customers right now.”
“The climate wrecking ball striking food supply.
“Extreme weather events and our warming planet are primed to strike commodities and the food supply like never before… The latest UN climate change report suggests that human actions may have rendered the Paris Agreement’s 1.5°C target, and possibly even its 2°C benchmark, infeasible…”
https://www.axios.com/2023/08/07/climate-commodities-food-supply
You can read the previous âEconomicâ thread here. I’ll be back tomorrow with a âClimateâ thread.
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“The climate wrecking ball striking food supply.”
See also:
https://yaleclimateconnections.org/2022/09/food-supply-and-security-concerns-mount-as-impacts-stress-agriculture/
and
https://yaleclimateconnections.org/2022/09/ags-challenging-future-in-a-changing-climate/
Its becoming obvious (which of course makes the number and vociferousness of the deniers more interesting). And the less obvious (and never mentioned) relationship to insurance rates creates the mechanism that puts to lie the projections of Tim Morgan and others.
Hello Pan
1. Watkins is a readable oil analyst. He is a bit vain though and advertises his thick books a lot. He does raise interesting questions. For instance, some time ago he posted an extensive article on SA’s recoverable reserves of oil. In it, he came up with startling kwoots based on which the extractable reserves would be significantly lower than what SA suggested.
Combining these two articles, the question arises to what extent SA is capable of increasing production significantly or at all?
I wouldn’t know the answer, not least because the oil market is extremely complex. What is clear is that there are relatively very few barrels coming onto the market at the moment and that oil discoveries will be below all expectations by 2023>.
I am inclined as a ‘depletion’ supporter đ to think that the Saudis have deliberately exaggerated their stocks under the motto ‘nothing wrong with us’ Let’s go and build a nice city Neom you regularly post about. It’s one of the ‘megalo’ projects I love reading about and can’t wait for the first ski resort to open there đ Have they gone mad or something.
2, Insurers and climate scetricians…. da’s a nice thing and a big problem as clearly utigelegated. However, every country has its own policy on ‘natural disasters’ and insurance. Last year in France, the drought caused billions in damage due to soil subsidence and cracks in houses. What matters then is whether each municipality has a ‘catastrophe naturelle’ If a municipality is placed under that regime, more money and insurance money is released than if it is not. That led to a lot of legal inequality last year because a house just across the municipal boundary suddenly fell outside the schemes. Was much litigated over.
In the Netherlands, damage caused by flooding from the sea and major rivers is not insured! Only in case of flooding by so-called secondary waterways is a payment made. Of course, hardly anyone knows this and two years ago, during the major floods in Germany/Belgium and the Netherlands, this led to huge unexpected uncovered claims by people who happened to live on a ‘primary’ river while another neighbourhood in the same city was insured because the flood was caused by a side river! Pretty sad.
That premiums will go up is certain, though, and indeed it is an argument that does carry some weight when talking to a climate sceptic anyway. Can’t be avoided đ
https://oilprice.com/Energy/Energy-General/The-Real-Facts-Behind-Saudi-Arabias-Wild-Oil-Claims.html
You ask whether “let’s sponsor Wahhabism mosques around the world to help destabilize western europe and buy up football players for a billion , but let’s not help out any refugees at all among our “fellow brother ” muslims, let europe solve all that ” Saudi has gone mad?
Questions has answered itself for years I’m sure . Some herders that would’ve happily tended their flock for centuries stumbled upon oil, that’s all.
Regarding SA and oil , I spend some months there in 2008 and at least back then the average industrial and oil industry parts were crumbling, badly conserved or expanded
Watch and quiver, latest , let’s say , documentary on the enthusiasm within the chinese army.
https://apnews.com/article/china-taiwan-documentary-attack-invasion-chasing-dreams-4105d5f0bde59337d90f1e67d149b32c
I honestly dont know if their shenanigans are equal or worse to the ski slope and mosque building of the Saudi government.
Both countries are putting in the effort to ensure we are in even more trouble after 2030 , then , no doubt already before that date
“Last month, the White House announced a $345 million military aid package for Taiwan. The move, which experts said drew on lessons from the U.S. military assistance to Ukraine, was criticized by Beijing.”
LOL –
So, the stupidity committed in Ukraine by US/NATO is to be duplicated in Taiwan. Lets see how that works out.
Dear Harmon,
To be honest, I know mostly a lot of ‘destabilised’ countries in the Mena region. That list is very long. You can argue about the cause, depending on where you are n the ‘spectrum’.
‘Is Oil a blessing or a curse’ ?
By the way, more than 40 per cent of Saudi Arabia’s population is made up of foreigners, according to the Saudi Census 022 organised by the kingdom’s General Statistics Authority.
Saudi Arabia’s population is 32.2 million with 18.8 million Saudis and 13.4 million foreigners – making up 41.6 per cent. In short just like the EU they are doing their best đ
Fair points Zip do keep in mind that Saudi immigration is only conscious import of cheap labour forces , almost none of them are disaster struck fellow muslims or economic luck seekers from Algeria like is the case in my Dutch and German homegrounds. Saudis know what their doing when it comes to spending money on all the wrong targets
About the oil.. and you being Dutch , and me being half Dutxh ..
They call that the Dutch curse dont they ? Having oil and large deposits and acutely mismanaging it
I honestly dont have an opinion on the quiet rise of BRICs, probably because I dont understand either the economic concepts, or the specific complexities of geopolitics, that get talked about in the topic. I’m motivated to keep it on my reading list though, possibly in the hope that my curiousity will one day lead to an Aha moment.
This latest musing on the webs made me smile with its final “punny” statement:
https://consciousnessofsheep.co.uk/2023/08/09/people-who-live-in-glass-houses/