“Bankers sound alarm on more inflation, new financial crisis at Hong Kong summit.
“As more than 300 banking and investment executives gathered in Hong Kong to discuss “living with complexity” in the financial world, they ended up trading trepidations about an uncertain future.
““My biggest fear is there’s one more geopolitical escalation and there’s a market event,” Christian Sewing, chief executive officer of Deutsche Bank, said Tuesday at the Global Financial Leaders’ Investment Summit in Hong Kong.”
“Central banks can’t go bust, but they’re haemorrhaging money.
“The world’s oldest central bank is in need of a government bailout. Sweden’s Riksbank, founded in 1668, has asked for a taxpayer recapitalisation” worth $7 billion to plug losses racked up in the past two years… the prospect of years of losses is… damaging to central bank credibility…”
“The Big Problem With Government Debt Isn’t What You Think.
“Even if savers are happy to absorb mounting public-debt piles, today’s financial plumbing may be too creaky to bear it… Investors are worried that Western governments are issuing more bonds than investors can buy. Whether the system that transacts in those bonds can bear the load could be a much more urgent issue.”
“US debt interest payments surge past $1 trillion yearly pace, worsening concerns about massive borrowing.
“US annualized debt interest payments crossed $1 trillion in October, according to a Bloomberg analysis. The cost of debt has doubled in the past 19 months as federal deficits balloon. High interest rates have made borrowing more expensive, adding pressure on US debt.”
“Bond-market crash leaves big banks with $650 billion of unrealized losses as the ghost of SVB continues to haunt Wall Street…
“The brutal Treasury-market meltdown has hit some of the largest financial institutions hard, dragging down the share prices of big names such as Bank of America and fueling fears that the turmoil triggered by SVB’s bankruptcy may not be over just yet.”
“Bank caution to tighten the squeeze on the US economy.
“The Federal Reserve’s Senior Loan Officer Opinion Survey shows banks have tightened lending standards further while households and businesses remain wary of taking on additional borrowing. Given how important credit flow is to the US economy it makes it all the more likely that the economy will continue to slow…”
“Heard through the grapevine: one of the largest commercial mortgage brokers in the country was raided over the weekend.
“Fraud was found in loans they’d sent to Fannie Mae. This could now trigger a chain reaction of buybacks and less liquidity among Fannie lenders.”
“The [US] economy is great, why are people ”feeling” so poor?
“Well – how is this for a feeling? Since April 2020: 1) Inflation up a cumulative 20%; 2) But median wages up only 12%; 3) Monthly mortgage instalments to buy the median house: up from $1000 to $2300 (!)”
“Americans now owe $1.08 trillion on their credit cards, according to a new report on household debt from the Federal Reserve Bank of New York.
“Credit card balances spiked by $154 billion year over year, notching the largest increase since 1999, the New York Fed found.”
“S&P Warns About Subprime Auto Bonds From Flagship, CarFinance.
“Subprime bonds backed by Flagship Credit Acceptance LLC and CarFinance Capital LLC loans have been placed on negative outlook due to their worse-than-expected performance, ratings firm S&P Global Ratings said in a note.”
“The obscure statistic warning of a thumping recession for Britain…
“…a small band of economists fear that a slump in the money supply is the clearest sign yet of the economy facing a serious recession. To them, it signals that inflation will be crushed so completely that Britain instead risks falling into a deflationary trap.”
“NHS hospital declares ‘major incident’ after maternity ward suffers blackout following flooding…
“An NHS hospital has declared a major incident and evacuated its maternity ward after it lost power throughout the entire building. The blackout at Blackpool Victoria Hospital Women’s and Children’s Unit comes after severe flooding took place overnight.”
“[UK] Shoppers braced for broccoli shortages after washout October…
“Shoppers are facing a broccoli shortage after supermarket supplies were hit by wet weather, growers have warned. Broccoli stocks have fallen over the last month after poor weather impacted yields and farmers planted less because of financial pressures.”
“Euro zone recession fears harden.
“The downturn in euro zone business activity accelerated last month as demand in the dominant services industry weakened further, a survey showed on Monday, suggesting there is a growing chance of a recession in the 20-country currency union.”
“Police clashed for a second night Tuesday with protesters who oppose negotiations between Spain’s acting government and Catalan separatist parties over a possible amnesty for thousands involved in Catalonia’s independence movement.
“Several protestors in Madrid waved Spanish flags and shouted insults against the acting prime minister, Pedro Sánchez, and some of them self-identified as “nazis” in chants.”
“German chancellor Olaf Scholz agrees ‘historic’ stricter migration policy.
“After a marathon session of talks in Berlin that continued into the early hours of Tuesday, Scholz said the measures would help speed up asylum procedures, restrict social benefits for migrants, and provide more federal funding for local communities.”
“Italy signs accord to send migrants to Albania, in deal slammed by rights groups.
“Italy will build two detention centers in Albania to house migrants trying to reach its shores, Prime Minister Georgia Meloni said Monday, in an attempt to control migration figures that have almost doubled in the year since she took office.”
“China’s Central Bank Vows Liquidity Help for Debt-Laden Regions.
“China will provide emergency funding to heavily indebted local governments as needed, central bank Governor Pan Gongsheng said — comments that underscore the importance authorities place on the problem.”
“Falling pork prices threaten to push China back into deflation…
“The price of pork in China, which is the world’s largest producer and consumer, has long followed a boom-and-bust cycle as smaller farmers pile into the market in response to rising demand. That leads to oversupply and triggers sharp price falls, forcing the same farmers to retreat.”
“Mexico implements emergency cash plan after hurricane.
“Mexico’s central bank, commercial lenders and other government authorities have activated emergency plans to provide banknotes after a hurricane struck coastal areas. The Bank of Mexico (Banxico), has also authorised relief for credit card debt.”
“Rebel fighting cuts power lines to Congolese city of Goma…
“Virunga National Park, which operates the network that supplies about 80% of Goma’s electricity, said on Monday that clashes between Congo’s army and the M23 rebels had severed the main power lines to Goma, a city of over 2 million people and the capital of North Kivu province.”
“Darfur refugees report new spate of ethnically driven killings.
“People fleeing to Chad have reported a new surge in ethnically-driven killings in Sudan’s West Darfur as the paramilitary Rapid Support Forces (RSF) took over the main army base in the state capital, El Geneina. On Tuesday, a Reuters reporter saw a trail of men crossing from Darfur into Chad at Adre…”
“Israel plans ‘indefinite’ controls over Gaza, says Benjamin Netanyahu…
“Netanyahu told ABC News on Monday that Israel would maintain an indefinite grip over Gaza, which is home to 2.3mn Palestinians, to ensure its own security. It was his first explicit comments on the country’s plans for the Palestinian enclave after its war with Hamas.”
“UK withdraws some embassy staff from Lebanon and tells nationals to leave.
“The Foreign Office has withdrawn some embassy staff from Lebanon and is advising British nationals to leave the country while they still can amid increasing concern about violence and unrest connected to the conflict in Gaza.”
“‘There Is Nothing Here’: Afghan Refugees Forced From Pakistan Struggle To Find Shelter.
“Nasrallah has spent days in a crowded makeshift camp for Afghan refugees returning from neighboring Pakistan. Like thousands of other returnees, he does not have proper shelter and sleeps out in the open with his family.”
“The World’s Broken Food System Costs $12.7 Trillion a Year…
“According to a report from the Food and Agriculture Organization of the United Nations (FAO), the total hidden costs of the world’s food system add up to $12.7 trillion dollars—roughly 10 percent of global GDP.”
“Global rice markets are in crisis amid ‘artificial’ shortage…
“Rice is a crucial staple for over half the global population and the world is bracing for its most significant shortage in 20 years. India’s export ban on rice is reverberating through global rice markets, threatening food security if developing nations cannot afford or access rice.”
“Extreme weather pushes global wine production to lowest level in more than 60 years.
“Global wine production has fallen this year to its lowest level since 1961 as vineyards were pummelled by extreme weather events, the International Organisation of Vine and Wine (OIV) has said. Output reached 244.1 million hectolitres, down seven percent from 2022…”
“‘Insanity’: petrostates planning huge expansion of fossil fuels, says UN report…
“The world’s fossil fuel producers are planning expansions that would blow the planet’s carbon budget twice over, a UN report has found. Experts called the plans “insanity” which “throw humanity’s future into question”. The energy plans of the petrostates contradicted their climate policies and pledges, the report said.”
You can read the previous “Economic” thread here. I’ll be back tomorrow with a “Climate” thread.
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