Daily updates on climate change and the global economy.

29th April 2021 Today’s Round-Up of Economic News

Markets are behaving dangerously but central banks have their heads in the sand

“…the Fed is increasingly caught up in a dilemma of its own making because the tide of cheap liquidity its $US120 billion ($155 billion) a month of bond and mortgage purchases has generated is producing some quite peculiar and potentially destabilising outcomes.”


US House prices soared by 12.0% from a year ago, the biggest increase since February 2006, near the peak of Housing Bubble 1, according to today’s National Case-Shiller Home Price Index for “February,” which reflects the three-month average of sales recorded in public records in December, January, and February…

“Ignored by CPI.”


Is The New Zealand Property Market Going Haywire?

Ultra-low interest rates, FOMO-driven mindset, and pandemic-related stimulus are seen to be turbocharging property markets across the globe, including New Zealand…”


Tasmania’s real estate market soaring, north-west prices up almost 30 per cent… There were 144 sales over $1 million, a whopping 162 per cent increase on last year.”


A staggering 123% boost in UK house purchases (Q1 2021) was… reported along with a rise in the purchase of second homes, which increased by 17% compared with Q1 last year.”


UK manufacturers’ profitability has dropped to its lowest level for a decade, according to official data that reflect the impact of pandemic-related costs and Brexit friction on the corporate sector…

The average was dragged down by a collapse in the profitability of North Sea oil and gas.”


Scottish company insolvencies expected to rise steeply. The number of Scottish companies facing insolvency is expected to rise steeply as government loans have to be paid.

“It comes despite restrictions on the economy being relaxed.”


Europe’s leaders are betting everything on red with reopening gambit.

The vaccine debacle tore EU politicians’ credibility into shreds; to open up only to spark another wave would be the final straw.”


France Demands More From EU on Growth as U.S., China Race Ahead

French Finance Minister Bruno Le Maire urged the European Union to speed up disbursements from its flagship stimulus package after the Finnish government threw a potential wrench into the process of releasing the funds.”


Germany’s domestic secret service placed one of the country’s most radical and violent groups opposed to coronavirus restrictions under surveillance, the Interior Ministry announced in Berlin on Wednesday

“The “Querdenker” group has made international headlines for being repeatedly involved in extremely brutal clashes with police where they attacked not only security forces but also media representatives.”


China labels India, Australia, Japan supply chain plan as ‘artificial’ and ‘unfavourable’ to global economy

“A move by Australia, India and Japan to establish an initiative to “strengthen supply chain resilience” in the region that is viewed as an effort to lessen dependence on China has been criticised by Beijing as an “artificial” programme that could upset the global economy.”


China is scrambling for semiconductor supremacy

“Chinese companies, along with others, have long-relied on a globalised value chain, and supplies from other companies. But this reliance has become, in the words of those at its highest levels of government, a “choke point” for the country’s technological ambitions.”


‘We will defend ourselves to the very end’: Taiwan minister’s vow as China ‘prepares final assault’

“China is “preparing for its final military assault” on Taiwan, the island’s foreign minister has told Sky News… Chinese military aircraft have been making almost daily incursions into Taiwan’s air identification defence zone recently, with April being a record month.”


Credit markets are sounding warnings for other asset classes amid India’s unprecedented surge in Covid-19 cases.

Firms have defaulted on at least 57 billion rupees (S$1 billion) of domestic bonds this year, the most on record for a similar period. Traders expect more.”


Chile’s dockworkers join nationwide protest over pensions policy.

“Chileans struggling with the financial impacts of Covid-19 are holding mass protests aimed at pushing President Sebastian Pinera to allow them to access funds from their privately held pensions for a third time during the pandemic.”


Argentina’s shale industry rattled by social unrest in Patagonia

Roadblocks to Argentina’s vast shale fields in Patagonia are about to enter their fourth week, as health workers on the frontline of the coronavirus pandemic demand higher wages to keep pace with one of the highest inflation rates in the world.”


Thousands of Colombians march to protest tax proposals

“Thousands of protesters answered calls from Colombia’s biggest unions to come out on streets around the country on Wednesday in protest against a controversial tax reform proposal.”


Algeria struggles to feed its people as crisis persists.

Strikes, unemployment, soaring prices and shortages of basic foodstuffs in Algeria, a boiling social situation is now added to a deep economic crisis caused by the fall in oil revenues and aggravated by the coronavirus pandemic.”


Chad protests turn deadly as demonstrators demand civilian rule

At least five people have been killed in Chad as demonstrators took to the streets demanding a return to civilian rule after the military took control following President Idriss Deby’s death last week.”


Nigeria’s Rivers state bans people entering, leaving at night.

Nigeria’s Rivers state will ban people crossing its borders at night due to heightened insecurity, its governor said on Tuesday, as violence and lawlessness surge across the West African country.”


Mozambique’s economy facing multiple risks as insurgency grows.

“Mozambique’s economy faces multiple challenges, including a growing insurgency against the government and recurring extreme weather events, ratings agency S&P Global said in research report.”


Almost 30 million will need aid in Sahel this year as crisis worsens, UN warns.

“A record 29 million people will need humanitarian assistance in the Sahel and the Lake Chad basin in 2021 amid a deepening crisis, a report by the UN office for humanitarian affairs (Unocha) has estimated.”


The Federal Reserve upgraded its view of the US economic recovery, but kept interest rates close to zero and showed no signs of moving to remove support for the economy.

“At the end of a two-day meeting, officials noted the improvement in the economy and offered a brighter picture than they had in March.”


Central bankers can no longer dismiss inflation concerns – price rises are everywhere.

China seems alert to the threat but the US Federal Reserve and other major central banks in the West need to show more concern about rising prices.”


The unlikely ticking time bomb on corporate balance sheets

“Corporate debt is relatively transparent and managed through legally binding contracts…

“The value of many assets, on the other hand, is little more than a collection of best guesses. For none is this more true than goodwill, which Adam Leaver, a professor of accounting and society at the University of Sheffield, describes as “the shadow asset of the corporate debt bubble”.”


A banking crisis is often seen as a self-­fulfilling prophecy: banks fail because too many people, anticipating failure, pull their money out at the same time.

But a newly published paper co-authored by finance professor Emil Verner suggests that banks can suffer losses serious enough to cause economic downturns even when that dramatic panic never happens.”


The New York State Department of Financial Services released a report on Tuesday regarding the investigation of the New York’s financial services industry’s response to the supply chain attack of… SolarWinds…

This [SolarWinds] incident confirms that the next great financial crisis could come from a cyberattack,” said Department of Financial Services Superintendent Linda A. Lacewell.”


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

If you found value in this content, please help me continue this work by becoming a patron of my work via patreon.com.

27th April 2021 Today’s Round-Up of Economic News

Global military spending hits highest level since 1988Military spending as a share of GDP – the military burden – reached a global average of 2.4% in 2020, up from 2.2% in 2019. This was the biggest year-on-year rise in the military burden since the global financial and economic crisis in 2009…

“The US, China, India, Russia, and the UK were the top five spenders in 2020, with 62% of the global military expenditure, the survey said.”


Bank of England considers ‘going Swedish’ with Britcoin… “No cash” signs are a frequent feature in central Stockholm. In 2018, just 1pc of Sweden’s GDP was circulating in cash, compared to 11pc across the eurozone.

“The trend is being mirrored in the UK… Now, both nations are on a quest to understand how a new type of digital currency can stop the countries’ central banks being sidelined in the future of money.”


Never mind debts in Greece or Italy, it’s France that’s heading for a crisis… Which country in Europe has the most total government debt?

“…As of this month, it is France. In hock to the tune of €2.67 trillion (£2.32 trillion), this month it finally overtook Italy as the Continent’s biggest debtor – and the third biggest globally.”


Twenty retired generals and scores of ex-officers have sparked a political furore in France after calling on President Emmanuel Macron to stop the country from descending into chaos and “civil war” at the hands of Islamists

“…the appeal has gained traction just days after a woman police employee had her throat slashed by an Islamist who had entered France illegally from Tunisia before eventually being granted residency.”


Bloodletting: Spanish banking sector reels as thousands let go:

“In Spain where bank tellers were once legion, the sector is again reeling from thousands of more job cuts as a 10-year trend gathers pace due to the ongoing pandemic.”


Italy eases Covid restrictions, as parliament weighs EU recovery package amid worst recession since World War II.

“Three-quarters of Italy have begun to ease Covid measures as the nation starts to emerge from months of lockdown after regional governments and residents protested continued restrictions amid a deepening recession in the country.”


Will Teenage Debt Cripple China’s Luxury Market? …Gen Zers reportedly buy 15 percent of all luxury goods sold in China

“…a 2019 HSBC survey highlighted that the debt-to-income ratio of Chinese consumers born in the 1990s had reached a whopping 1,850 percent.”


India’s COVID surge imperils global economic recovery: US Chamber

“Myron Brilliant, an executive vice president of the Chamber, the biggest US business lobby, said on Monday that the risk of spillover effects was high given that many US companies employ millions of Indian workers to run their back-office operations.”


Zimbabwe street vendors reel under virus curbs… The UN World Food Programme in a recent report, noted “a sharp decline in the standard of living” among the urban poor…

“Zimbabwe’s economy has been struggling for over a decade with hyperinflation and an economic downturn.”


Uganda says may approach creditors for suspension of debt repayments:

“Uganda said on Monday it may approach its major creditors including China and the World Bank to negotiate a possible suspension of loan repayments amid a growing default risk after its debt load ballooned 35% in a single year.


Chad faces devastating lean season, food crisis… Lean season is the period between planting and harvesting when job opportunities are scarce and incomes plummet…

““The number of food insecure people is expected to increase from nearly 4 million (March-May 2021) to 5.1 million from June to August 2021, when food is scarce before the next harvest,” the WFP said.”


Nigeria: Hunger Looms as Food Prices Spike

With food inflation leaning at a tipping point of 23 per cent amid the recent 18.17 per cent inflation figure released by the Nigerian Bureau of Statistics (NBS), tougher times now await Nigerians, LEADERSHIP Sunday can now reveal.”


Photos and videos of a mass irregular migration attempt in Fnideq, northern Morocco went viral on Sunday… A group of young Moroccans lined up on the town’s beach in an attempt to swim from Fnideq to the Spanish enclave of Ceuta…

The situation… emphasized the frustration in the region regarding the socio-economic crisis…”


Terrorist Group Steps Into Venezuela as Lawlessness Grows

“Venezuela’s economic collapse has so thoroughly gutted the country that insurgents have embedded themselves across large stretches of its territory, seizing upon the nation’s undoing to establish mini-states of their own.”


Venezuela’s Armed Forces reported new clashes with a Colombian irregular group on the border with Bogota.

“The clashes resulted in a “significant number” of Colombian causalities, and “some” Venezuelan casualties,” said the forces in a statement on Monday.”


Mexico’s economy extended its decline as it shrank more than expected in February… The Mexican economy contracted by 5.1% in February…

Latin America’s second largest economy has been hard hit by the coronavirus pandemic…”


Prosperous Costa Rica faces reckoning on debt

“Covid-19 has brought a reckoning. As the economy contracted 4.5 per cent last year and the important tourism sector slumped 40 per cent, a debt burden approaching 70 per cent of gross domestic product proved unsustainable.”


Caribbean food security during COVID-19 can only be ensured through debt relief...

“The pandemic and global trade disruptions have highlighted the growing vulnerability of Caribbean states when it comes to importing food items. Annually, Caribbean states import food items valued at nearly US$5 billion for food security.”


Saint Vincent and the Grenadines Agriculture Minister issues food security alert

“The catastrophic situation in Saint Vincent and the Grenadines, which suffered a series of volcanic eruptions this month that left the country in a state of emergency, is affecting the availability and affordability of food…”


Puerto Rico’s population fell 11.8 percent to 3.3 million over the past decade

“Puerto Rico has suffered a string of disasters and setbacks that have led to an exodus of island residents to the U.S. mainland. Those include drought, near economic collapse because of crushing debt, and thrashings from hurricanes…”


2020 Census shows U.S. population grew at the second slowest pace in history

“The first numbers to come out of the 2020 Census show the U.S. population on April 1, 2020 — Census Day — was 331.5 million people, an increase of just 7.4 percent between 2010 and 2020…

“The slowdown is probably due to the aging of the country’s White population, decreased fertility rates, and lagging immigration.”


US companies plan price rises as inflation pressure builds

“Consumers have been put on notice to expect higher prices for goods ranging from toilet paper to washing machines to restaurant burritos, in a number of recent announcements that underline inflationary pressures across the global economy.”


Producer Prices Surge. Germany, China, other Countries Are Now Exporting Inflation, Adding to US Inflation Pressures

“…factory prices have been rising on a month by month basis for the seventh straight months — with large increases over the past three months.”


Pandemic has affected tourism 18 times more than the 2008 financial crisis: WTTC…

““Tourism is currently facing its greatest challenge in history to overcome the adverse situation left in its wake by… COVID-19. And this great challenge also requires a team effort, also unprecedented, that allows us to overcome adversity,” said Guevara Manzo.”


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

If you found value in this content, please help me continue this work by becoming a patron of my work via patreon.com.

24th April 2021 Today’s Round-Up of Economic News

The Grocery Price Shock is Coming to a Store Near You: Corn, wheat, soybeans, vegetable oils: A small handful of commodities form the backbone of much of the world’s diet and they’re dramatically more expensive, flashing alarm signals for global shopping budgets.

“This week, the Bloomberg Agriculture Spot Index — which tracks key farm products — surged the most in almost nine years…

“With global food prices already at the highest since mid-2014, this latest jump is being closely watched because staple crops are a ubiquitous influence on grocery shelves — from bread and pizza dough to meat and even soda.”


Why ‘Clean Plate’ must only be part of China’s war on food waste:

Although the Asian powerhouse has recently seen a decline in population growth, food security remains a key issue.”


USDA wants farmers’ ideas on how food supply chains can be strengthened:

Agriculture Secretary Tom Vilsack announced that the US Department of Agriculture (USDA) is seeking comments on a Department-wide effort to improve and reimagine the supply chains for the production.”


87% of Americans are worried about inflation. Americans are growing more concerned about rising costs and are consistently boosting their inflation expectations, new data show.”


Despite falling jobless claims, America’s poverty rate just reached the highest level since the pandemic began

Those who experienced the sharpest rise in poverty included children, white people, women, those with low education, and those in nearly half of U.S. states that have more restrictive unemployment-insurance payment policies.”


Medical debt is engulfing more people [in the US] as pandemic takes its toll.

“”I wake up in the middle of the night thinking about it. I just can’t believe it’s come to this,” said one woman with long-term Covid symptoms.”


The UK Government borrowed £303.1bn in the last year, an increase of £246bn on the previous year, according to figures from the Office of National Statistics (ONS).

As a ratio of GDP, borrowing was up 14.5 per cent, the highest ratio since the end of World War Two when it was 15.2 per cent.”


One clothes shop in four in Antwerp [Belgium] is in danger of going bankrupt, according to figures from the business consultancy Graydon, reports Gazet Van Antwerpen.

“Needless to say, the Covid-19 crisis has made the situation worse. Before the pandemic, Graydon said, about 9% of shoe shops were flirting with failure. That figure is now 45%.”


Banks in the eurozone and in Greece should be ready to face a significant increase in nonperforming loans in view of the pandemic crisis and prepare for active management of those loans…

“We expect a further worsening of asset quality, particularly with the gradual phaseout of support measures.”


Credit Suisse has been forced to go cap in hand to its shareholders for £1.3billion of emergency funding after suffering a double blow from the implosion of hedge fund Archegos and the collapse of Greensill Capital.

On a bleak day for the Swiss banking giant, it confessed to racking up losses of £594million in the first three months of the year.”


Emerging Market issuers raise record $191bn on foreign debt markets in early 2021

Governments and companies in developing nations borrowed on foreign markets at a record pace in early 2021, but investors say the risks are mounting as some countries endure a resurgence of coronavirus.”


Hundreds of Chileans, mostly women, headed to capital Santiago Thursday to access their pension funds in the face of an economic crisis.

Protesters banged pots and pans and disrupted traffic by setting a barricade on fire.”


Argentina can’t overcome its chronic inflation issue:

“In the first three months of 2021, price rises show no sign of slowing down. As well as being cause for concern for the government, businesses and citizens are feeling the pinch.”


Ravaged by Covid, Brazil Faces a Hunger Epidemic:

“Tens of millions of Brazilians are facing hunger or food insecurity as the country’s Covid-19 crisis drags on, killing thousands of people every day.”


Now hunger stalks India as country’s Covid crisis deepens.

A wider disaster is building, one that – if left unchecked – could start to engulf large parts of the country.”


There are 22.7 million children in Turkey and at least one-third face chronic poverty, with the COVID-19 pandemic deepening their deprivation…

“…around 7.5 million children were deprived of the conditions that were needed to support their physical and psychological development.”


Saudi Arabia announced on Friday a ban on imports of fruits and vegetables from Lebanon, blaming an increase in drug smuggling, in a measure that will add to Lebanon’s economic woes.

“Lebanon is already in the throes of a deep financial crisis that is posing the biggest threat to its stability since the 1975-1990 civil war.”


Panic in Lebanon as desert locust swarms hit farmland:

“Ersal Mayor Bassel Al-Hujairi recounted seeing “millions” of locusts flying and attacking cherry trees and crops… If these swarms multiply, they can cover the sun.”


The Next Middle East Crisis Will be Rising Food Prices:

Prices have already soared 25% in the past year and are set to rise further. Could another Arab Spring follow?”


Shortage of semiconductors, dubbed the ‘new oil,’ could dent GDP growth, boost inflation.

Soaring demand coupled with supply bottlenecks have led to a situation in which orders for everything from cars to televisions to touch-screen computers and more are on backup for six months or more.”


Global supply chains are struggling to keep pace with spiking orders volumes

“The strain on supply chains is particularly acute among manufacturers. Order volumes across the sector were up by 80% year on year in March, but invoice volumes grew by just 20% over the same period.


Prices of the world’s biggest cryptocurrency, bitcoin, fell over 13% on Friday to slump below the $50,000 level for the first since 8 March on US president Joe Biden’s tax plans. Bitcoin (BTC) dominance has also dropped below the 50% mark for the first time since 2018…

“Meanwhile, the world’s second-biggest cryptocurrency, ethereum, which hit its all-time high of $2,640.37 on Thursday, slumped as much as 14%…”


The U.S.’s mounting debt load may warrant investors rethinking their expectations for a liftoff from the Federal Reserve’s easy monetary policy

Kit Juckes, a London-based strategist at Société Générale warns the U.S.’s indebtedness may mean tighter monetary policy could prove more punishing to the economy, creating a ceiling on how high interest rates can rise.”


Money Market Funds Melted in Pandemic Panic. Now They’re Under Scrutiny.

“In March 2020, the Federal Reserve had to step in to save the mutual funds, which seem safe until there’s a crisis… Now, the savings vehicles could be headed for a more serious overhaul.”


Deadly Banana Fungus Puts World’s Top Exporter [Ecuador] on High Alert

The banana woes are just the latest example of a supply threat to crops as a cold snap slows U.S. grain planting and dry conditions plague corn in Brazil. That could all mean even higher food prices at a time when global grocery costs are spiking.


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

If you found value in this content, please help me continue this work by becoming a patron of my work via patreon.com.

22nd April 2021 Today’s Round-Up of Economic News

Economic Recovery Masks Dangers of a Divided World: Advanced economies are now forecast to enjoy cumulative growth in GDP per head between 2019 and 2022 just 1 percentage point less than in January 2020. But emerging markets and low-income developing countries are forecast to suffer hits to growth in GDP per head of 4.3 (5.8, without China) and 6.5 percentage points, respectively.

To those who have, it shall be given back. But, from those who have not shall be taken even the little that they had: in January, the World Bank reported the rise in the number of people in extreme poverty last year as a result of Covid-19 at between 119m and 124m. Given the dire forecasts, this calamity seems unlikely to reverse soon…

It would be unwise to take for granted the strong recovery forecast for the advanced economies. It is possible that new variants invulnerable to today’s vaccines will sweep across the world. It is highly likely that it will prove impossible to reopen borders soon. It is possible, too, that monetary and fiscal policies will turn out to have been too strong…

Moreover, even if high-income countries, China and a few others do recover strongly, many emerging and developing countries are likely to remain in great difficulty, as a result of a painfully slow rollout of vaccines, problems in managing debt, the stresses caused by worsening poverty and limited policy space…

Nothing would be more foolish than for policymakers in rich countries to breathe a sigh of relief and turn their eyes away from the global challenges they confront.”


The pandemic devastated the once strong US labor market — that much we already knew from various economic data. On Wednesday, the Bureau of Labor Statistics added a bit more detail.

Nearly 10% of US families — 9.8% to be precise — included at least one unemployed family member last year. That was double the number from 2019, when 4.9% of families confronted unemployment.”


More than a year into the Covid-19 pandemic, millions of American remain jobless, but even as the economy reopens some employers are finding hiring an unexpected challenge.

“From fears of being infected with the coronavirus to trouble finding childcare to the lure of generous unemployment benefits, some jobless Americans are holding off on re-entering the workforce.”


Pandemic hits UK household finances harder than EU peers

“UK households have suffered a bigger income shock during the Covid-19 crisis than their French and German counterparts, and are more likely to have run up debts, according to research highlighting the inadequacy of the UK’s welfare safety net.”


UK: Tensions grow between protesters and scandal-hit police… Police and crime bill proposes sweeping reforms… At almost 300 pages long, the bill proposes to increase police powers during protests…

“This includes handing police chiefs greater authority to restrict “static” protests such as an assembly or a gathering, manage noise levels, and control start and finish times. Under the law, police do not have to give a warning that protesters could be arrested.”


Scottish fishing leaders have condemned plans for a “scandalous” blockade by French rivals that threatens to prevent them landing their catch.

“Jimmy Buchan, the chief executive of the Scottish Seafood Association, said the action at Boulogne-sur-Mer would damage UK businesses already hard hit by Brexit.”


In Germany, 60 Arrested in Protests Over COVID Restrictions

“Police in central Berlin have clashed with protesters outside the German parliament, which is considering a bill to give Chancellor Angela Merkel the power to impose tougher restrictions as the nation suffers a third wave of coronavirus infections.”


“A deepening crisis”: Passenger traffic at Europe’s airports set to fall by -64% in 2021 compared to pre-pandemic levels

“Passenger traffic at Europe’s airports is set to fall by -64% compared to 2019 as the latest data underlines what Airports Council International (ACI) Europe calls “a deepening crisis in the sector, with air traffic in a continuing downward spiral”.”


Japan’s government is expected to issue a third state of emergency on Tokyo and three western prefectures that could last for about two weeks…

[This] may push Japan back into recession… A renewed state of emergency would also cast doubt on whether Tokyo can host the Olympics in July, despite Prime Minister Yoshihide Suga’s assurances it will proceed as planned.”


Japanese financial institutions have become more exposed to market risks triggered by non-bank and overseas funds, the central bank warned on Tuesday, in the wake of losses caused by the collapse of family office Archegos Capital Management.”


A slide in the rupee is exacerbating a slump in Indian corporate dollar notes that are now among the worst performers in Asia, just as concerns mount that companies are hedging less…

The weaker rupee pushes up servicing costs on foreign debt. The currency has plunged about 2.4% against the dollar this month… Spiking Covid-19 cases threaten to worsen the selloff.”


India’s health care system and other essential services are close to collapse as a second coronavirus wave that started in mid-March tears through the country with devastating speed.

“On Wednesday, the country saw its highest daily rise in infections and deaths since the start of the pandemic…”


17 child migrants disappear every day in Europe since 2018… Some 5,768 children disappeared in 13 European countries last year alone…

“The majority of the children who have gone missing since 2018 have traveled from the Middle East and North Africa, with significant numbers arriving from Morocco and Algeria.”


President of Chad Idriss Deby dies in clashes with rebels one day after winning election

“Mr Deby, 68, died of wounds suffered on a visit to the frontline of a campaign against rebels in northern Chad, the military said on national television and radio on Tuesday.”


Thousands flee fresh clashes in Central African Republic

“Violence flared across CAR following last December’s contested elections, with armed elements allied with former president François Bozizé attacking several towns and villages. Hundreds of thousands of people were displaced within the country as well as into neighbouring ones.”


War was easier than this, says Lebanese entrepreneur hit by economic collapse… “With war you get a couple of missiles falling one day and then the next day you pick up and you go back to school or back to work and you start producing and making money,” said Suzanne Mouawad.

“”Now the money is being held at the banks and there is no work.””


Syrian missile explodes in area near Israeli nuclear reactor, Israel retaliates

“Israel and Syria exchanged missile attacks early Thursday morning after Damascus launched an advanced surface-to-air missile that landed all the way in the Negev Desert.”


Jerusalem seethes with clashes between Jews, Arabs

“Jerusalem police report having detained more than 50 people suspected of rioting. Police Commissioner Kobbi Shabtai arrived yesterday to east Jerusalem as the situation escalated. Police fear further escalation as members of the extreme right call for supporters to come to Jerusalem and confront local Arab residents.”


Food insecurity is rising sharply in Myanmar in the wake of the military coup and deepening financial crisis with millions more people expected to go hungry in coming months, the United Nations said on Thursday.

Up to 3.4 million more people will struggle to afford food in the next three to six months with urban areas worst affected…”


Almost €500,000 of goods were stolen from EMEA [Europe, Middle East and Africa] supply chains every day in 2019 and 2020, according to new data from the Transport Asset Protection Association (TAPA).

“And TAPA warned that these figures were likely to be just the tip of the supply chain crime iceberg…

“Thefts from trucks continued to represent the vast majority if incidents last year…”


Wall Street bears battered by the Reddit crowd earlier this year have yet to regain their gumption, even with stocks at records and valuations near two-decade highs

“”There’s just mass euphoria,” said Benn Dunn, president of Alpha Theory Advisors. “No one wants to get their head ripped off by a short anymore.””


Global wine consumption fell to its lowest point since 2002 last year amid curbs on hospitality venues amid the coronavirus pandemic, according to Paris-based International Organisation of Vine and Wine…

“OIV puts the total exports of wine-producing countries at an estimated 29.6 billion euros ($35.6 billion), a figure that would represent a fall of nearly seven percent.”


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

If you found value in this content, please help me continue this work by becoming a patron of my work via patreon.com.

20th April 2021 Today’s Round-Up of Economic News

Images showing desperate Turkish citizens scrambling to grab free handouts of potatoes have stoked an ongoing debate over chronic poverty in the country

“…members of Turkey’s main opposition Republican People’s Party (CHP) claim the situation has only served to further highlight growing concerns over mass poverty, social injustice, and soaring food prices.”


Will Inflation Trip Up Emerging Economies? …A …pernicious side-effect of inflation …is the impact of food prices on emerging economies… the UN FAO world food price index has hovered around the 100 level since 2015, but in the past six months has jumped to 120.

This move, should it persist, represents a high, large cost to families in the emerging world (who spend a large share of their disposable income on food staples).”


The Egyptian economy is still in a major crisis… Data released by Egyptian officials, foremost among them those at the Central Bank, have shown a noticeable decline in all foreign currency earnings…

“Consequently, Egypt has resorted to further external and internal borrowing, leading to the exacerbation of the burden emanating from the costs of public debt, such as interest and repayments.”


Edo State Governor, Mr. Godwin Obaseki, last week, stirred a costly controversy when he claimed that the [Nigerian] federal government has had to resort to printing of currency to augment shortfall in revenue.”


The population of Zambia is paying the price for Zambia’s sovereign default – when the government missed a payment on its debt – in November 2020. The most direct impact is in the form of higher food prices.

“Overall annual inflation climbed to 22.8% in March from 22.2% in February, driven by food inflation, which jumped to 27.8%.”


Covid in Brazil: Hunger worsens in city slums.

The queue snakes around the block and each day it gets longer…

“…hungry residents of Heliopolis, São Paulo’s largest favela, waiting in line for the handout that will keep them going until the next morning.”


‘We Were Left With Nothing’: Argentina’s Misery Deepens in the Pandemic

“The pandemic has accelerated an exodus of foreign investment, which has pushed down the value of the Argentine peso. That has increased the costs of imports like food and fertilizer, and kept the inflation rate above 40 percent. More than four in 10 Argentines are mired in poverty.”


UN agency to provide food assistance for Venezuelan children:

“The efforts of the World Food Program will focus on feeding children in the areas with the highest prevalence of food insecurity. The agency plans to gradually expand programs to reach 1.5 million children…”


North Korean soldiers deployed on the border with China to ensure the anti-pandemic blockade are starving, writes Daily NK citing its own sources from the province of Chagang.

According to the publication linked to the Ministry of Unification of South Korea, North Korean troops of the Seventh Corps and the “Storm” corps received regular supplies of food until March. Since April, stocks have decreased in quality and quantity.”


China facing economic crisis as population peak nears, PBOC adviser says.

Consumption set to slump after population tops out in 2025, says Cai Fang, a member of the central bank’s monetary policy committee.”


China’s growth numbers betray waning momentum: China reported record year-over-year growth of 18.3% in the first three months of 2021.

But the more telling figure might be the economy’s 0.6% expansion compared with the quarter before–a historically sluggish pace that suggests momentum is slowing, one year into China’s coronavirus recovery.”


For Huarong, China’s biggest bad bank, it’s bailout or bust.

“If Chinese authorities opt not to save China Huarong Asset Management, it could trigger a chain reaction of financial risks.”


China’s Illegal Fishing To Worsen Philippine’s Food Security Problem.

Opposition Sen. Francis Pangilinan warned of a serious fish supply shortage if the Chinese presence remains in the West Philippine Sea…”


The Australian Defence Force is war-gaming what its combat role would be in a potential military conflict with China over Taiwan, sources have revealed.

Military officials in Canberra have been planning out ‘worst case’ scenarios in which Collins-class submarines and Super Hornet fighter jets would be deployed to the Taiwan Strait…”


Is Japan ready for a Taiwan crisis? Scenarios warn of food and fuel shortages.

“Not a day goes by without Taiwan in the news. U.S. military leaders warn of the possibility of a Taiwan Strait contingency. U.S. President Joe Biden and Japanese Prime Minister Yoshihide Suga underscored the importance of peace and stability across the strait during their meeting Friday.”


US condemns Russian plan to block the Black Sea as ‘yet another unprovoked escalation’ amid fears Kremlin will attack Ukraine’s water supply facilities.

“Washington has condemned the ‘unprovoked escalation’ of Russian plans to block the Black Sea, which could prevent access to Ukrainian ports.”


Russia’s central bank will raise its key interest rate on Friday by 25 or 50 basis points, amid high inflation and intensified geopolitical risks, a Reuters poll showed on Monday.

“A rate hike became more necessary recently when the rouble took a hit from a new wave of sanctions and inflation, the central bank’s main area of responsibility, showed little signs of slowing.”


[India’s] bankers fear the lockdown-like curbs, including curfews, travel restrictions and mall shutdowns, are likely to hurt borrowers, triggering a second wave of defaults.

Without a repayment moratorium like the one announced by the RBI last year, the defaults are likely to pinch banks harder.”


Large euro zone banks have been underreporting their risky assets by 275 billion euros by using their own models to quantify potential losses, the European Central Bank said on Monday.


Monday Monetary Meltdown – Velocity of Money Crosses a Dangerous Threshold.

“Money is simply not being spent in our economy [USA] and that’s not the sign of a healthy economy. Of course, we’ve been heading this way for two decades now back from the 90s, where $1 earned would circulate through the economy and average of 2.2 times, generating 3.2 GDP Dollars.

“Now the velocity of money is getting close to 1…”


Millions at risk of famine without urgent help, governments warned

“World leaders are facing a call to act immediately to stop multiple famines breaking out, exacerbated by the coronavirus pandemic and caused by conflict, climate crisis and inequality.”


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

If you found value in this content, please help me continue this work by becoming a patron of my work via patreon.com.

17th April 2021 Today’s Round-Up of Economic News

The economy is running on a stimulus-fuelled caffeine high. What will happen when it wears off? [Caffeine is putting it mildly!]

“…One-time spending has rarely been the catalyst for long-term growth. Fiscal and monetary policy that now serve as irresistible tailwinds could soon turn into headwinds.”


Biggest Banks Can’t Keep Up With U.S. Money Printing: Bank of America, Citigroup and other retail-facing banks are all experiencing declining loan growth as deposits surge…

“… the magnitude of the government response to the Covid-19 crisis is causing some difficulties at the largest U.S. financial institutions.”


High street’s woes hit UK’s private landlords… the coronavirus crisis has emerged as a profound threat for …private commercial property investors, who range from local entrepreneurs and self-employed professionals… to wealthy millionaires on national newspaper rich lists.

The pandemic has pushed many tenants to the brink and forced painful discussions about who will take the hit as incomes in retail plummet, leaving behind a swelling pile of rent arrears.”


New research reveals… more than 440 firms in banking and financial services have relocated part of their business, moved employees or set up new entities in the EU following Brexit.

Banks have moved or plan to move more than £900bn in assets to the EU, equivalent to 10 per cent of the entire UK banking system. Insurance firms and asset managers have transferred more than £100bn.”


The euro zone economy will recover at a much weaker rate this quarter than expected only a month ago, according to a Reuters poll of economists who cited a slower vaccine rollout as the biggest risk over the next three months.”


Germany warns of lasting economic damage as Covid cases spin out of control:

Germany’s decentralised health system that seemed to work so well at the start of the pandemic is now a slow-moving disaster a year on.”


“…the European speculative-grade default rates are being pencilled in at 4.7% according to Moody’s and 5.3% according to S&P.

However, Moody’s baseline forecast estimates a sharp decrease in default rates by the end of this year. We think this is too optimistic… we expect default rates to stay elevated for longer.”


Inequality virus’ threatens ‘catastrophe for all’ unless crisis can be overcome together… said UN Deputy Secretary-General, Amina Mohammed.

Developing countries have faced “ballooning debt burdens” and constrained fiscal budget, and high borrowing costs, with a limited ability to respond to the pandemic, Ms. Mohammed explained.

The diverging world that we are hurtling towards is a catastrophe for all of us”, she spelled out.”


Emerging markets fall behind their developed-world counterparts:

While developed-world markets look forward to a recovery, emerging market stocks have tumbled as foreign investors pull out cash.”


Unwelcome Inflation Heats Up in Mexico, Brazil, and as Always in Argentina:

“Brazil’s central bank struck back with shock-and-awe rate hike. Mexico’s central bank faces tough spot after big hit to economy. Argentina’s inflation exceeds 42%.”


Cuba’s economic woes may fuel America’s next migrant crisis:

“The pandemic hammered Cuba’s tourist industry, which suffered a 75% decline – a loss of roughly $2.5 billion… These external shocks hit an economy already weakened by the decline in cheap oil from crisis-stricken Venezuela… Since Cuba imports most of its food, the island nation has experienced a food crisis.”


‘It’s a day off’: wiretaps show Mediterranean migrants were left to die

“The conversation, recorded by prosecutors in Sicily investigating sea rescue charities for alleged complicity in people-smuggling, lays bare the indifference of individuals on the Libyan side to the plight of migrants and to international law.”


Hunger Deepens in West Africa, With 31 Million People at Risk

“More than 31 million people in the region are expected to be food insecure and unable to feed themselves between June and August, a period when food is scarce ahead of the next harvest, the United Nations organization said in a statement Friday.”


‘It is really bad’: Nigerians go hungry as food inflation soars

““Not long after Nigeria’s statistics agency revealed that one in three people in the continent’s largest economy were unemployed, on Thursday it announced that food inflation has accelerated at the highest pace in 15 years, compounding the misery of many households.”


U.N. agencies said Friday that tens of thousands of Nigerians are fleeing deadly attacks by armed groups and the continuing clashes between the rebels and national forces in the country’s troubled northeastern Borno state

The incidents mark the latest violence in the Lake Chad basin area which in recent years has uprooted some 3.3 million people…”


US warns pandemic could push some Middle East countries to collapse: By the end of 2021, the number of people in the MENA region living beneath the poverty line will reach 192 million, the World Bank’s estimates.

“”As a result, some states are likely to experience destabilizing conditions that may push them close to collapse,” the intelligence report said.”


The price of iftar [Ramadan evening meal after fast] is soaring across much of the Arab world… food prices have steadily risen in recent months…

“…in the Arab world, where most countries are net importers of food, particularly staples such as grains, the effects are particularly severe.”


Syria devalued the official price of its local currency on Thursday, two days after the central bank governor was sacked, state media reported.

The decision came as the Syrian pound has continued to crash in recent months in the war-torn country, hitting record lows and throwing more Syrians into poverty.


“With food and fuel, Hezbollah braces for the worst in Lebanon collapse…

Lebanon’s Hezbollah has made preparations for an all-out collapse of the fracturing state, issuing ration cards for food, importing medicine and readying storage for fuel from its patron Iran, three sources familiar with the plans told Reuters.”


A recovering world economy that depends upon the synchronized, smooth running of global supply chains is now being slammed by what has turned out to be synchronized disruptions

The pressures on supply chains are increasing and global disruptions are likely to only get worse as summer approaches and the economy booms. Disruptions have converged at the same time in three important pillars of the global economy – shipping, computer chips, and plastics.”


Fans of bubble tea may soon find themselves unable to enjoy the beverage as the US reportedly faces what may be a months-long shortage of boba

“…a backlog at US ports occurring as a result of the ongoing pandemic means that the ingredients used to make the popular drink… aren’t becoming available fast enough to keep up with the demand.”


The spread of the arbitrage economy – Troubles rise as companies exploit the opaque gaps between regulations

“The debacle at Archegos bears a remarkable resemblance to the near-collapse of the Long-Term Capital Management hedge fund in 1998, which foundered because of overleveraged positions in risky derivative instruments. Despite frenetic regulatory activity since then this experience raises the worrying possibility that we are in a vicious circle where financial crises breed rafts of new regulations which in turn breed more financial arbitrage which precipitate further, bigger crises.”


Nasdaq Is Entering A Mighty Bubble: A moving 18-month slope of the NASDAQ provides overwhelming evidence that the index has ascended far above its normal path.

If the NASDAQ pops, its bursting power is so strong that the aftermath can be comparable to that of the Great Depression.”


Bloated Central Bank Balance Sheets: There are good reasons to believe that there will be no return to the pre-QE configuration of balance sheets.”


Global markets have got central banks over a barrel.

Both bond and stock markets have become so dependent on ultra-loose monetary policy, so hyper-sensitive to any perceived possibility of a change in conditions, that there is little monetary authorities can now do to avert the dreaded taper tantrum if they threaten the status quo…

The new normal is a world with lots of QE and rock-bottom interest rates. Anything else will cause ructions in stimulus-dependent markets.”

[This is not in any way “normal” and nor is it sustainable. This is hyper-financialisation, as the financial system keeps stretching and mutating in an ultimately doomed effort to offset growth constraints in the physical economy of goods and services. The elastic limit approaches.]


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

If you found value in this content, please help me continue this work by becoming a patron of my work via patreon.com.