Daily updates on climate change and the global economy.

29th September 2022 Today’s Round-Up of Economic News

Is a global recession coming? More experts are raising the alarm. After beginning as a murmur early in the year, warnings of an incoming global recession are growing louder by the day.

“During the past week, high-profile figures from the head of the World Trade Organization (WTO) to American Nobel Prize-winning economist Paul Krugman have sounded the alarm about the likelihood of a global downturn.”


Commodity prices slumped as a deteriorating economic outlook and surging US dollar weigh on the value of the world’s raw materials.

“On Wednesday, everything from copper to gold and cotton were trading lower amid a renewed resurgence in the greenback as traders price in a darkening global economic outlook.”


Nickel sales by commodities-dealing banks hit by soaring borrowing costs have caused spot contracts to plunge to the deepest discount to futures since the 2008 financial crisis

“…prices have slid, with fears over curbs on Russian supply giving way to worries about a worsening demand outlook.”


Apple Is Seeing Softer iPhone Demand. The Consumer Slowdown Is Getting Real.

“There’s been warnings from FedEx FDX about the economy. Walmart and Macy’s are preparing for a weaker Christmas. But nothing drives home the fact that shoppers are tightening their belts more than signs Apple won’t sell as many units of its new iPhone as it thought.”


MSC confirmed today that demand from China to the US west coast had “significantly reduced” and it would be “taking certain actions” to rebalance its capacity, starting with the suspension of an entire service.

“Until now, the major ocean carriers have used blanking strategies to take out capacity, but the demand outlook has deteriorated rapidly in the past few weeks, obliging lines to consider axing services.”


Hurricane Ian is poised to strike at the nation’s production of phosphate fertilizer, threatening supply as the cost of growing food in the US rises by the most ever.

“Florida is home to Mosaic Co.’s phosphate rock assets, where they mine product, and to facilities where they turn that rock into fertilizers like diammonium phosphate and monoammonium phosphate, commonly known as DAP and MAP.”


The Bank of England has been forced into emergency action to halt a run on Britain’s pension funds after the impact of Kwasi Kwarteng’s ill-received mini budget prompted fears of a 2008-style financial crisis…

“City sources said the surprise move, less than a week after Kwarteng’s unfunded tax giveaways, was needed to halt a “doom loop” in the bond markets that risked draining pension funds of cash and leaving them at risk of insolvency.”


British companies face highest borrowing costs on record.

“Britain’s biggest companies are facing record borrowing costs as Kwasi Kwarteng’s debt-funded tax cuts continue to wreak havoc across financial markets. Blue-chip companies that raise money by issuing bonds face record refinancing costs after the Chancellor doubled down on his fiscal plans…”


Workers strike again at UK’s largest port Felixstowe in threat to holiday shipments.

“The dockworkers at Felixstowe, the largest port in the UK, have started an eight-day strike in protest over their wages and inflation, overlapping with an ongoing strike at Port of Liverpool. Together, the two port strikes threaten imports and exports across industries…”


France Is Hit by Strikes Over Pay at Multiple Oil Refineries.

“A strike by workers at France’s oil refineries is disrupting fuel supplies in Europe’s third-largest economy, another blow to the country as it battles a sprawling energy crisis. Workers have gone on strike at oil refineries that handle more than half the country’s fuelmaking.”


French minister advises: ‘Wear a turtleneck sweater this winter’…

“Le Maire is not the only European politician to give an energy-saving lead through fashion – this summer Spanish PM Pedro Sanchez announced that he would no longer wear ties to the office, although in his case this was to keep cool as Spain imposed limits on air-conditioning.”


Germans could have to give up ‘comfort’ under emergency energy plans.

“German households will not be guaranteed gas this winter beyond what is deemed “vital for life”, under emergency plans handed to MPs… Ministers are also refusing to exempt entire sectors such as health or education from possible power cuts, because some of their gas use is not critical.”


Thousands of people rallied in several eastern German states on Monday evening to protest the government’s energy policy and sanctions against Russia.

“The protesters shouted slogans against Chancellor Olaf Scholz’s coalition government and carried banners bearing the messages “Stop the price explosion,” “Stop the war, stop the sanctions,” and “Open Nord Stream now.””


Slovakia energy crisis could ‘kill our economy’, premier warns.

“Slovakia’s prime minister said soaring electricity costs had left his country’s economy at risk of “collapse”, in the starkest comments yet by an EU leader on the effects of the global energy crisis… His warning underscores the huge consequences of Moscow’s efforts to squeeze gas supplies in response to EU sanctions…”


Citi Says European Equity Outflows Are Biggest in a Decade… Regional stocks see eight months of outflows…

“Investors are abandoning European stocks at levels last seen during the euro zone debt crisis a decade ago, according to Citigroup Inc. strategists, adding that this could represent a contrarian signal to buy.”


Nord Stream Hit Adds to Europe’s Economic Woes in 2009 Echo.

The economic damage from the shutdown of Russian gas flows is piling up fast in Europe and risks eventually eclipsing the impact of the global financial crisis. With a continent-wide recession now seemingly inevitable, a harsh winter is coming for chemical producers, steel plants and car manufacturers starved of essential raw materials who’ve joined households in sounding the alarm over rocketing energy bills.”


Sweden has found a new leak in a major undersea pipeline carrying Russian natural gas to the EU – making it the fourth discovered this week.

“Denmark and Sweden reported gas leaks in the Nord Stream 1 and 2 pipelines earlier this week, raising the possibility of a deliberate attack.”


Gas prices have risen on fears that Russia could halt supplies to Europe through Ukraine, adding to turmoil caused by damage to the Nord Stream pipelines under the Baltic Sea.

“The Kremlin-controlled gas company Gazprom said it could impose sanctions on Ukraine’s Naftogaz due to ongoing arbitration.”


Europe braces for mobile network blackouts.

“Once unthinkable, mobile phones could go dark around Europe this winter if power cuts or energy rationing knocks out parts of the mobile networks across the region… Telecoms industry officials say they fear a severe winter will put Europe’s telecoms infrastructure to the test…”


China’s Sept factory activity set for third straight monthly contraction.

“China’s factory activity is expected to have shrunk for a third month in a row in September, a Reuters poll showed on Thursday, as strict COVID measures in big cities and weakening exports growth hit orders and business confidence.”


China’s yuan sinks to record low against the dollar.

“The declines come despite China’s central bank on Monday announcing moves to stem the yuan’s decline by making it more expensive to bet against the currency. International investors have rushed to buy up the dollar, a traditional safe haven, as aggressive rate hikes by the US Federal Reserve stoke pessimism about the global economic outlook.”


Protests in Shenzhen as China puts it into snap lockdown over Covid cases.

“Hundreds of Chinese residents in the southern city of Shenzhen have taken to the streets to demand an end to coronavirus lockdowns in a rare public protest against the zero-tolerance Covid policies imposed by Beijing. Video from Shenzhen in southern Guangdong province showed angry citizens confronting police officers…”


Asia must prepare for looming oil and gas shortages.

“An unprecedented and likely irreversible slump in global oil production capacity over the past two years, coupled with a sustained drop in the investment needed to rebuild it, is building toward an avalanche that will likely rattle the world, especially once fuel demand growth begins to recover from the economic slowdown now approaching.”


Sri Lanka power cut: Govt official blames poor oil quality, minister threatens legal action.

“As Sri Lanka grapples with a major power outage, a senior government official has blamed the poor quality of crude oil imports for the shutdown of a power plant, resulting in extended power cuts… sulphur content is too high…”


Pakistan braces for harsh winter as gas shortages loom…

“Pakistan began importing LNG seven years ago. However, the price of the commodity on the international spot, or short-term, market has risen from lows of $2 per million British thermal units in 2020 to highs of $57 in August this year after demand in Europe surged, pushing Islamabad out of the market.”


Afghanistan’s Taliban fire shots into air to disperse women’s rally backing protests.

“Women protesters carried banners that read: “Iran has risen, now it’s our turn!” and “From Kabul to Iran, say no to dictatorship!” Taliban forces swiftly snatched the banners and tore them in front of the protesters. Defiant Afghan women’s rights activists have staged sporadic protests in Kabul and some other cities…”


Iran Protests Show the Depth of Social and Economic Pain…

“Baraye is the Persian equivalent of the English word “for.” It’s a simple preposition that people are using to highlight the scale and scope of their grievances against the Islamic Republic as the country is shaken by some of the biggest demonstrations it’s seen since the 1979 revolution.”


Rockets hit central Baghdad for second day in escalating unrest.

“Wednesday’s attack took place as parliament was holding a vote to confirm its speaker. The political crisis has left Iraq without a government for nearly a year after elections last October… The standoff spiralled into street clashes killing dozens of people in central Baghdad in August…”


Nigeria’s central bank has raised interest rates to an all-time high of 15.5 per cent as it struggles to contain a surge in inflation.

“The bank raised its benchmark interest rate by 150 basis points — its third consecutive rate rise — to combat price pressures that have left citizens facing soaring costs for fuel and food.”


President Cyril Ramaphosa says ongoing blackouts are eroding people’s trust in government.

Ramaphosa was speaking after his speech was ironically interrupted by power cuts at the Local Government Summit in Boksburg. The two-day meeting was aimed at finding ways for municipalities to improve governance and service delivery to residents.”


Gang blockade cripples Haiti fuel supplies, hospitals prepare to close.

“”Some hospitals are unable to admit new patients and are preparing to close,” wrote United Nations children’s agency UNICEF in a statement on Monday, adding that three quarters of major hospitals were affected by the diesel shortages.”


Volatility in the ordinarily sedate world of bonds climbed further on Wednesday to one of the highest levels since the 2007-2009 financial crisis and recession.

2The ICE BofA MOVE Index, which tracks fixed-income volatility, rose to 158.99 on Wednesday, according to Refinitiv. That’s up from 158.12 on Tuesday — the highest reading since 2009, with the exception of a brief spike to 163.70 on March 9, 2020, during the onset of the COVID-19 pandemic…”


Bond Markets Are Nearing a Painful Inflection Point.

“This week’s bond meltdown has sent the mean 10-year borrowing cost for Group of Seven countries to its highest in more than a decade, with the average yield surging above 3%. What happens next could set the tone for financial markets and the global economy for years to come.”


A new scarcity is upon us… It’s a depressing picture of growing scarcity, whether it be in energy, materials or food.

“Much of society had been so used to what they called the ‘age of abundance’, located within the first-world with its digital services and its branded experiences and plethora of premium price points, that hardly any mainstream commentators seriously considered it would be possible to return to a time where whatever was needed was not at one’s fingertips on a store-shelf- or a smartphone screen. But that time is here.”


The Western world today faces a serious risk of slipping into another Great Depression…

“The 1920s were a decade of debt and decadence because the international system was built on an unstable pyramid of debt… The depression really set in when Europe’s collapse gave rise to a collapse of global trade. We see very similar dynamics at play in the world today…

“The collapse of Europe will take place because Europe no longer has access to sufficient energy for its economic needs… There is no going back for Europe now.”


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. And if you are already a subscriber or have donated – thank you! It is an enormous help as the cost-of-living crisis ratchets up here in the UK.

27th September 2022 Today’s Round-Up of Economic News

IMF bailouts hit record high as global economic outlook worsens… Fund hands out $140bn in loans as interest rate rises push up countries’ borrowing costs…

Experts predict that further large rate rises by major market central banks will push up borrowing costs around the world and risk triggering a severe recession. Some analysts say the IMF’s lending capacity could soon be stretched to its limits, as poor countries which are locked out of international debt market are forced to turn to the fund for support…

“Zambia and Sri Lanka — which both defaulted in the pandemic along with Lebanon, Russia and Suriname — are negotiating IMF bailouts as part of efforts to restructure their debts. Ghana, Egypt and Tunisia are in early talks for similar support.

“The IMF approved a $1.1bn bailout for Pakistan at the end of August; Argentina is set to receive $3.9bn in the next few weeks as part of its $41bn programme.”


A key gauge for raw materials prices has tumbled to the lowest in eight months amid mounting fears of a global recession.

“The Bloomberg Commodity Spot Index, which tracks futures contracts for everything from oil to copper and wheat, fell 1.6% to settle at its lowest level since Jan. 24. The measure has lost almost 22% since peaking in June and has erased all of its gains since Russia’s invasion of Ukraine.”


Oil Prices Drop as Dollar Soars and Global Recession Fears Grow.

“Oil prices continued to plummet on Monday, plunging to their lowest levels since January and continuing weeks of decline as fears of a looming global recession mount, inflation rates remain historically high and the strong performance of the U.S. dollar dampens demand.”


Hedge funds dump distillates as recession risks intensify.

“Portfolio investors anticipate an imminent recession that will hit consumption of middle distillates such as diesel especially hard, based on recent position changes in futures and options markets… Middle distillates such as diesel and gas oil are mostly used in freight transportation, manufacturing and mining, so they are heavily geared to the business cycle.”


Central Banks May Stoke Risks by Raising Interest Rates Together… The most widespread rate increases on record have some economists worrying…

“…some worry that central banks are effectively pursuing national responses to what is a global problem of excess demand and high prices. They warn that central banks as a group will thus go too far—and push the world economy into a downturn that is deeper than necessary.”


Global recession fears and collapse in confidence could turn the dash for cash into a stampede.

“Investors are running for cover as recession beckons, inflation and interest rates rise and global economic confidence withers. Despite many turning to the US dollar as a safe haven, the continued rise in interest rates suggests cash will soon be king.”


U.S. dollar strength creating ‘untenable’ situation that risks financial crisis -Morgan Stanley.

“The wild swings in currencies are another pressure on the global economy and corporate earnings, which are expected to fall as the Federal Reserve’s aggressive interest rate hikes over the summer begin to weigh on spending.”


This Has Not Happened Since 1929… U.S. monetary policy continues to tighten while signs of recession abound and a major speculative bubble unwinds.

This was last attempted in late 1929 and exacerbated the ensuing stock market crash. Severe volatility should be expected if the Federal Reserve chooses to continue on its current path.”


Consumer Debt Hits Record for Most Americans, Except the Wealthy…

“Consumer debt, including credit cards, rose to an all-time high for the 118 million US households among the bottom 90%, according to the Federal Reserve’s latest data on the distribution of household wealth. The group’s debt soared by $300 billion over the last year — the largest annual gain on record — as households deal with higher prices for everything from food to clothing and rents.”


Food inflation forcing Canadians to get desperate…

“Some have opted to grow their own food. A total of 15.5 per cent of Canadians have started growing their own food just in the last year. Ontario is where the highest percentage of people started to grow their own food. Others are just trying to navigate through by using new options.”


UK bond prices collapse after sterling hits record low.

“British government bond prices collapsed on Monday, pushing yields to their highest in over a decade, amid speculation that the Bank of England might need to take emergency action after sterling hit a record low against the U.S. dollar overnight.”


Hedge funds made huge gains before the pound crash… [pictured, Crispin Odey – one of the beneficiaries]

Concerns have emerged… that leaks of the mini-budget allowed funds to short the pound. A member of the government’s opposition party, Labour Treasury Secretary Tulip Siddiq, has called for the Financial Conduct Authority to carry out a probe into whether information of fiscal policy was leaked…”


Regulators are preparing to slash red tape in the North Sea in a bid to speed up the development of oil and gas wells, as part of Liz Truss’ dash for new energy supplies

“The North Sea Transition Authority (NSTA) is also trying to identify areas that can be developed quickly as they have known reserves and are close to existing pipes and rigs, which it will try to licence ahead of others.”


Cost-of-living protest: Thousands turn out for Dublin march…

Ireland will face a new era of “forced emigration” unless the cost of living crisis is tackled by the Government, a rally in Dublin heard on Saturday… Addressing the crowd, Sinn Féin president Mary Lou McDonald said the Government must ban any rent increases for at least three years.”


Lights out, ovens off: Europe preps for winter energy crisis.

“As Europe heads into winter in the throes of an energy crisis, offices are getting chillier. Statues and historic buildings are going dark. Bakers who can’t afford to heat their ovens are talking about giving up, while fruit and vegetable growers face letting greenhouses stand idle.”


Euro crashes to record low against dollar as Italy’s Giorgia Meloni and far right win.

“The euro slid to a fresh 20-year low on Monday, falling below 96 cents against the US dollar ― the steepest decline in two decades ― after the rise of a far-right party in Italy’s election rattled investor confidence. The single currency, which came into physical circulation in 2002, slumped to $0.9550 against the greenback…”


Germany Secures Just One Tanker of Gas During Scholz’s Gulf Tour.

“German Chancellor Olaf Scholz secured just one shipment of liquefied natural gas from the United Arab Emirates, with a non-binding agreement for more, as Europe’s biggest economy struggles to replace Russian supplies.”


In Moldova, thousands in new call for government’s resignation.

Several thousand people protested in Moldova’s capital on Sunday for the second straight weekend to demand the resignation of the country’s pro-Western government amid mounting anger over spiralling natural gas prices and inflation.”


A Ponzi scheme by any other name: the bursting of China’s property bubble…

“Nearly a third of all property loans are now classed as bad debts – 29.1%, up from 24.3% at the end of last year… The market is experiencing a total collapse in confidence, analysts say… About 2m off-plan homes remain unfinished across China, according to a rough estimate by S&P. That figure will grow if sales continue to fall and developers continue to run out of money to complete projects.”


In China, home buyers occupy their ‘rotting’, unfinished properties.

“Xu and about 20 other buyers living in Xiulan County Mansion… are part of a movement of home buyers around China who have moved into what they call “rotting” apartments, either to pressure developers and authorities to complete them or out of financial necessity, as numerous cash-strapped builders halt construction amid the country’s deep real estate slump.”


Weaker Demand for Chinese Goods Spells End of Shipping Boom.

“The cost of shipping goods from China has slumped to the lowest level in more than two years as the world economy stumbles, dimming prospects for container carriers that turned in record profits during the pandemic… China’s economic slowdown is also cutting into import demand…”


China growth to fall behind rest of Asia for first time since 1990… World Bank is latest financial institution to slash Chinese economic forecast…

“China had set a GDP target of about 5.5 per cent this year, which would have been a three-decade low. But the outlook has deteriorated markedly over the past six months.”


Hong Kong is reconnecting with a world economy heading for a deep recession and stagflation…

“The ugly reality is that we are emerging from over 30 months of acute and potentially permanent economic self-harm only to join a world economy poised to tumble into its deepest recession in four decades, with stagflation of maybe five years or more.”


Crisis Level Risks Loom in Asia as Major Currencies Crack.

“The yuan and yen are both tumbling due to the growing disparity between an uber-hawkish Federal Reserve and dovish policy makers in China and Japan. While other Asian nations are digging deep into foreign-exchange reserves to mitigate the dollar’s damage, the yuan and yen’s slump is making things worse for everyone…”


Argentina has ceased to be a tire-manufacturing country as labor conflicts resulted in the closing of all three plants nationwide…

“Pirelli stopped production this weekend due to the lack of inputs because of union blockades dating back to over 100 days, joining Fate and Bridgestone. Unable to bring in nitrogen trucks Friday with such an essential input, the company Saturday closed down operations until further notice.”


Protests in Colombia against President Petro’s tax reform.

“Thousands of protesters marched on Monday against economic and social reforms proposed by Colombian leftist President Gustavo Petro – which he says will fight inequality – just 50 days after he took office… Some marchers compared Petro’s governance so far to authoritarianism and said objections to his administration would mount.”


Fuel shortages at Cape Town airport threaten tourism recovery.

“The shortage of jet fuel at Cape Town International Airport could disrupt the schedule of airlines and force them into refuelling detours, potentially increasing their costs at a time when the aviation and tourism industries are showing strong signs of recovery after Covid-19.”


Protests Over Water Shortages Shut Longest South African Highway.

“Part of South Africa’s longest highway, which runs from Cape Town to Zimbabwe, was shut on Monday by protesters who were demonstrating over water shortages… The situation remains tense and the public order police unit is on the scene, police spokeswoman Loraine Earle said by phone.”


Catastrophic Grid Failure Causing Widespread Blackouts in Nigeria.

“Nigeria’s national electricity grid woes show no signs of abating with the grid collapsing again on Monday, leaving many parts of the country without power. Nigeria’s national power grid has collapsed at least four times this year, with the authorities blaming technical problems for the breakdowns.”


Sudan: Market Closures Spread Across the Country Amid Economic Insecurity.

“In protest against tax increases by state governments in Sudan, markets in El Obeid, capital of North Kordofan, El Gedaref, capital of El Gedaref state, and Ed Damazin, capital of Blue Nile state, will close between Sunday and Thursday, as the country’s economy continues to stagnate.”


Protests in Tunisia’s capital amid inflation, food shortages.

“Some gathered burned tyres, while others chanted, “Where is Kais Saied?”, in reference to Tunisia’s president, who is under pressure as the North African country faces a financial crisis, with inflation running at nearly nine percent and shortages of some food items in stores across the country.”


Renewed militia clashes rock western Libya; 5 killed.

“A new round of infighting between rogue militias in western Libya has killed at least five people, including a 10-year-old girl, health authorities said Monday, the latest bout of violence to rock the North African nation mired in decadelong chaos.”


Poverty and Inflation: Egypt’s Economy Hit by Global Turmoil…

“For the nearly third of Egyptians living in poverty, and the millions more in poor conditions, the country’s economic woes mean life is much harder than off-season shopping — they’re finding it harder to put food on the table. A decade after deadly protests and political upheaval rocked the Middle East’s most populous nation, the economy is still staggering and has taken new hits.”


Daily blackouts put Lebanon’s ancient artefacts at risk…

“For the museum’s stone objects, climate control is not an issue. But for items such as frescoes, mummies and textile, metal or organic artefacts like Bronze Age weaponry and Roman leather armour, temperature and humidity control – and therefore power – is essential.”


Tense calm in Baghdad as new protests planned for Oct 1…

“Demonstrators, mostly of the younger generations, had camped out in the capital’s Tahrir Square and other public squares from October 2019 until early 2020, decrying endemic corruption, poor services and unemployment by the former Iraqi government led by Adil Abdul-Mahdi.”


Iran protests: at least 450 arrested in northern province…

“Protests sparked by the death in police custody of 22-year-old Mahsa Amini have spread across the country. They have been met with internet shutdowns and violent repression. The official death toll in the unrest is 41, and human rights groups say the true number may be higher.”


Photos: Sri Lankan police fire tear gas to disperse protesters.

“The Sri Lankan police violently dispersed hundreds of demonstrators a day after severely curtailing protest rights in response to months of unrest sparked by the island nation’s sharp economic downturn. President Ranil Wickremesinghe has taken a tough line against activists who forced his predecessor to flee the country…”


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. And if you are already a subscriber or have donated – thank you! It is an enormous help as the cost-of-living crisis ratchets up here in the UK.

24th September 2022 Today’s Round-Up of Economic News

“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.

“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.”


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.”


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.”


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.”



“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!”


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.


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.”


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.”


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.”


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…”


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.”


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.”


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.”


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…”


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…”


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.”


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.”


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.”


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.”


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.”


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.”


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…”


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.”


[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.”


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.”


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.”


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.”


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.


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.”


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.”


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.”


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. And if you are already a subscriber or have donated – thank you! It is an enormous help as the cost-of-living crisis ratchets up here in the UK.

22nd September 2022 Today’s Round-Up of Economic News

World powers are paralysing the UN and pulverising the planet… Global warming will not wait for geopolitics to cool down…

“Ukraine will continue to harden and deepen the divide between the United States and Europe in the West and Russia and China in the East.

“With the four comprising some 60 percent of the world economy, and all the veto powers at the UNSC, expect their conflict and collision to sap the energies of the United Nations and paralyse the multilateralism that could help the world to tackle global disasters.”



A Great Copper Squeeze Is Coming for the Global Economy…

“You wouldn’t know it from looking at the market today, but some of the largest miners and metals traders are warning that in just a couple of years’ time, a massive shortfall will emerge for the world’s most critical metal — one that could itself hold back global growth, stoke inflation by raising manufacturing costs and throw global climate goals off course.”


A global manufacturing slowdown suggests worse is to come.

““Is a global recession imminent?” asks a new report by the World Bank. The answer—that one very well might be—will not be a surprise to manufacturers… Debt loads around the world remain alarmingly high, and many country’s economies lag below their pre-pandemic trendline. Their leaders will be watching the slowdown in global manufacturing with considerable trepidation.”


IMF chief warns there will be ‘people on the street’ globally unless steps taken to ease inflation… [On the other hand, they’re hardly going to be thrilled with a swingeing recession either]

“”It is important to think that this compounded impact of multiple crises is already testing the patience and resilience of people. And if you don’t take action to support the most vulnerable, there would be consequences,” she told CNN’s Christiane Amanpour.”


US Fed hikes interest rate to highest level since 2008.

Intensifying its fight against chronically high inflation, the United States Federal Reserve has raised its key interest rate by a substantial three-quarters of a point for a third straight time, an aggressive pace that is heightening the risk of an eventual recession.


Big U.S. banks’ prime rate soars to highest since financial crisis… The move follows a similar hefty hike by the Federal Reserve…

Hopes of a soft landing have waned in recent months as the Fed remains steadfast in its decision to keep raising rates until data shows a sustained pullback in consumer prices.”


A global backlash is brewing against the Fed… Surge in US borrowing costs is having spillover effects for the rest of the world…

“Rate rises, while necessary to quell inflation, have become so aggressive the World Bank warned last week they risk sending the global economy into a devastating recession that would leave the world’s poorest countries at risk of collapse… Yet, it is difficult to see what the US central bank can do but raise rates.


As recession looms, central banks have no good options.

“As the world’s biggest investment banks prepare to report third-quarter earnings in October, the signals are bad across the board… As the financial world gathers in Washington DC for the annual meetings of the IMF and the IIF, it faces one of the grimmest outlooks on record.”


Global Recessions Are Relatively Rare. Simultaneous Rate Increases Could Trigger One… Today, the global economy is already experiencing a much steeper growth slowdown than was seen in the run-up to earlier global recessions

“It’s an impossible situation for economic policy makers. All the signs point toward a sharp global economic downturn as the main engines of growth sputter: the United States, China, and the euro area. Ordinarily, the remedy would be to stimulate growth by slashing interest rates, cranking up public spending, and cutting taxes. This time, however, the opposite is taking place.”


UK’s mounting debts unsustainable if sweeping tax cuts go ahead, warns IFS.

“Fuelling concerns that the UK’s precarious financial position will spark a run on the pound, the chancellor, Kwasi Kwarteng, is expected to reverse an increase in national insurance payments and cut corporation tax at a cost to the Treasury of £30bn.”


British pound, euro stuck in a ‘doom loop,’ TD strategist says.

“The pound and euro are trapped in a “doom loop” caused by soaring energy prices that feed into weaker economic growth and lower currency values, wrote strategists including James Rossiter in a note on Friday.”


Germany’s biggest gas importer Uniper is nationalised after huge losses.

“The German government has said it will nationalise the country’s biggest gas importer, Uniper, as it battles massive losses amid Europe’s energy crunch. The Finnish company Fortum that had controlled Uniper said Russia’s squeeze on supplies since the invasion of Ukraine meant that the unit had lost €8.5bn (£7.4bn) to date.”


German industry suffers worst shock since 1949 from Putin’s energy stranglehold.

“Prices of industrial products jumped by almost 46pc over the past year, according to the Federal Statistical Office, which is the biggest ever increase on records dating back to 1949 when Germany was divided and recovering from the Second World War.”


Europe energy crisis may deepen with looming liquidity crunch…

“Europe’s problems in sourcing oil and gas this winter after a dispute with Russia may be exacerbated by a new crisis in the market where prices are already red-hot: a liquidity crunch that could send them spiralling higher still… The ECB declined to offer fresh comment.”


European governments spend half a trillion euros on energy crisis…

“Governments in Europe have earmarked nearly 500 billion euros in the last year to cushion citizens and companies from soaring gas and power prices, according to research published by think-tank Bruegel on Wednesday.”


‘The situation has deteriorated.’ Deutsche Bank forecasts deeper Europe recession amid a war-fueled energy crisis…

“Hopes for a “mild recession” in Europe this winter have been abandoned by Deutsche Bank strategists, who have dramatically slashed their 2023 growth forecasts… That downgrade comes after the indefinite closure of the Nord Stream 1 pipeline for Russian gas into Europe, that was announced in early September.”


Thousands protest in Brussels over cost of living crisis.

“Rising food prices, startling energy bills, and frustration with politicians and employers brought 10,000 people to the streets of Brussels on Wednesday. Dressed in green, blue and red, the colours of the three main unions – the anger was palpable as they gathered in the city centre.”


Italy’s banking system braces for winter energy crisis, election spillovers.

“Reporting from Milan, CNBC’s Joumanna Bercetche highlights the impacts the Italian banking system could experience from the energy crisis and a potential economic contraction this winter.”


China’s rulers seem resigned to a slowing economy… Gone are the days when they led the world in recession-busting…

“Thanks to its deep property slump and the government’s “zero-covid” policy, which entails lockdowns in response to every outbreak of the virus, the economy is now forecast to grow by less than 3% in 2022, according to banks such as Nomura, Morgan Stanley and ubs. That is far below the official target of 5.5%.”


Japan intervened in forex market to stem weak yen…

“The Japanese government has intervened in the foreign exchange market to sell dollars for yen to stem the Japanese currency’s recent sharp falls, top currency diplomat Masato Kanda said on Thursday. “We have taken decisive action (in the exchange market),” he told reporters…”


South Korean won falls through key level after Fed hike.

“South Korea’s won tumbled past the psychologically important 1,400 level against dollar for the first time in 13-1/2 years on Thursday on the U.S. Fed’s aggressive tightening and defying official warnings against sharp currency moves.”


Thai acting PM asks finance ministry to monitor weak baht – official.

“There were concerns about weakness in the currency and also oil prices, Anucha Burapachaisri told a briefing. The baht was trading at its weakest level in more than 15 years against the dollar.”


South Africa’s economy is reeling under the most severe electricity blackouts in the country’s history, as load-shedding threatens to trim growth further in the continent’s most industrialised economy.

“The escalation has meant most South Africans have been without power for at least six hours a day, hammering an economy which has been struggling to re-emerge from the effects of the Covid-19 pandemic.”


Default ‘a real possibility’ for Ghana, Fitch senior director says.

“Sovereign debt default is “a real possibility” for Ghana, and any kind of domestic debt restructuring could severely threaten the local banking sector, a senior director from the ratings agency Fitch said on Wednesday.”


Maldives: Closing in on an economic crisis… The Maldives is said to be in a brittle economic state, slowly inching closer to what Sri Lanka and Pakistan are experiencing…

“Tourism is the nation’s economic mainstay but future predictions of complete recovery to pre-COVID levels are not encouraging, as the current trends indicate. The IMF has said as much, linking anticipated short-falls this year…”


Iran death toll rises as protests intensify.

“Iranian authorities said on Wednesday three people including a member of the security forces had been killed during unrest sweeping the country, as anger at the death of a woman in police custody fuelled protests for a fifth day.”


Barricades and ditches limit access to fuel terminals in Haiti… protests intensified last week when the government confirmed the adjustment to increasing fuel price…

“For over a week, the capital and other cities have remained blocked, with their shops, public and private institutions closed and without access to transportation…. A number of lootings of humanitarian institutions, banks, schools, religious organizations and state offices like the Civil Protection have been reported.”


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. And if you are already a subscriber or have donated – thank you! It is an enormous help as the cost-of-living crisis ratchets up here in the UK.

20th September 2022 Today’s Round-Up of Economic News

Vulnerable countries demand global tax to pay for climate-led loss and damage.

“The world’s most vulnerable countries are preparing to take on the richest economies with a demand for urgent finance – potentially including new taxes on fossil fuels or flying – for the irrecoverable losses they are suffering from the climate crisis, leaked documents show.”


Coal rush! Energy crisis fires global hunt for polluting fuel… Prices for thermal coal, used to generate electricity, have leapt to record levels as a result of the war, which has led to many European countries losing access to vital supplies of natural gas and coal from their top provider Russia.

“Buyers in Europe and beyond are now vying to pay top dollar for coal from often remote mines in places such as Tanzania, Botswana and even potentially Madagascar.”


In July, the European Parliament made a remarkable decision: it approved a law designating natural gas as a sustainable energy source…

“…Russia’s invasion of Ukraine has changed perceptions entirely. Instead of potentially stranding natural gas assets in the decade ahead, policymakers have shifted their attention to how they can keep the lights on and homes warm this winter. Tens of billions of euros of investment in gas projects will follow.


OPEC+ Is Now 3.6 Million Bpd Below Its Oil Production Target.

“The OPEC+ group continues to vastly underperform its collective oil production target, with the gap between the quota and actual output widening to a massive 3.58 million barrels per day (bpd) in August, according to delegates and OPEC data Argus has seen.”


Lithium shortages ‘will mean cars must switch to hydrogen’…

“The latest quarterly update from the Advanced Propulsion Centre states that expected shortages of battery-grade lithium in this decade mean domestic manufacturers must prepare to “mitigate” against lacking supplies and to “diversify powertrain choice in the short to medium term”.”


The U.S. dollar is experiencing a once-in-a-generation rally. For the rest of the world, that is a big problem. The dollar’s role as the primary currency used in global trade and finance means its fluctuations have widespread impacts…

“The surge threatens to exacerbate a slowdown in global growth and amplify inflation headaches for global central banks. In a worrying sign, attempts from policy makers in China, Japan and Europe to defend their currencies are largely failing in the face of the dollar’s unrelenting rise.”


Florida insurance crisis deepens as rates soar, companies fall.

Long known as the nation’s most hurricane-prone state, Florida has achieved a new status that is aggravating hurricane anxieties and threatening real-estate values. Florida has the worst property-insurance market.”


Puerto Rico’s Bankrupt Power Utility Heads Toward Litigation After Debt Talks End.

Puerto Rico’s bankrupt power utility and bondholders may face off in court Wednesday in the wake of Hurricane Fiona’s damage after mediation talks over the agency’s $9 billion debt restructuring ended last week without a deal.”


Europe races to prepare for energy crunch this winter.

“Germany was pressing on Monday to secure liquefied natural gas contracts with Gulf producers and other European states outlined measures to conserve energy, with Russian flows running at severely reduced levels as winter approaches.”


Europe’s Truckmakers Stockpile Gas as Energy Crisis Worsens…

“Mercedes-Benz Trucks, a unit of the world’s biggest commercial vehicle maker Daimler Truck Holding AG, is switching to oil for a large part of production at plants in Germany, according to division head Karin Radstrom. Volkswagen AG’s Traton SE, owner of the Scania and MAN brands, has a “huge” gas tank on the way and is going back to “good old coal,” said Chief Executive Officer Christian Levin.”


‘Crippling’ Energy Bills Force Europe’s Factories to Go Dark.

Manufacturers are furloughing workers and shutting down lines because they can’t pay the gas and electric charges… Makers of metal, paper, fertilizer and other products that depend on gas and electricity to transform raw materials into products from car doors to cardboard boxes have announced belt-tightening.”


Finland’s grid operator renews power outage warning…

“As a result of “great uncertainties, people in Finland should be prepared for power outages caused by possible electricity shortages this coming winter,” Fingrid Oyj said in an updated forecast of power availability… Last week, Finnish utility Fortum confirmed that in October, it will reactivate an idle coal-fired power plant on Finland’s west coast…”


Germany is heading into recession as inflation is set to top the 10-percent mark, the Bundesbank said in its monthly report on Monday.

““There are mounting signs of a recession in the German economy in the sense of a clear, broad-based and prolonged decline in economic output,” the report said. The central bank projects a moderate contraction for the current quarter and more pronounced declines in activity in the final quarter of this year and the first quarter of next year.


Global recession is coming. New export orders for Germany (blue) – a key export engine of the global economy – have fallen off a cliff.

“This isn’t about Germany, but about weak global demand across Europe and China, which is weighing on German exports.

Others aren’t far behind.”


Europe braces for far-right Italy this week.

“Last week the European Parliament’s turn provided the show in the European political scene… This week Europe is bracing for the shock of having a far-right leader head the eurozone’s third largest countries — which also happens to be one of most indebted.”


Protests erupt across Austria demanding solution to cost of living crisis.

“On Saturday, September 17, trade unions and other working class sections hit the streets across Austria protesting the government’s inefficiency in tackling the ongoing cost of living crisis… People across Europe have been reeling under an acute cost of living crisis marked by soaring inflation in food and fuel prices.”


Moldova: Thousands participate in anti-government protest amid high inflation.

“On Sunday, thousands of people took to the streets of the capital city outside Moldova’s government to denounce high inflation and fuel prices while also calling for the resignation of the country’s pro-Western president Maia Sandu and her government.”


Frugal is the new cool for young Chinese as economy falters…

“This new frugality, amplified by social media influencers touting low-cost lifestyles and sharing money-saving tips, is a threat to the world’s second-largest economy, which narrowly avoided contraction in the second quarter. Consumer spending accounts for more than half of China’s GDP.”


Even State-Backed China Developers at Risk of Surging Default, Citi Says…

“Bad debt climbed to about 29.1% of total property loans in the first half of this year, up from 24.3% at the end of 2021, according to calculations by Citi’s team including Judy Zhang. The increase is largely attributable to developers controlled by the Chinese government, the analysis showed.”


South Africa is facing a risk of an unprecedented level of blackouts this week after units at two of its coal-fired power plants broke down.

“Eskom Holdings SOC Ltd. earlier on Sunday began cutting 6,000 megawatts from the national grid, in what it calls Stage 6 power cuts, after generation units tripped at the Kusile and Kriel power stations. That’s sufficient energy to supply almost 4 million South African homes.”


Turbulence in Nigeria dollar market hits airlines and investors.

“So tight is the supply of dollars in Nigeria these days that even big international airlines are struggling to repatriate revenue from ticket sales. Emirates announced it would suspend flights to and from Nigeria from September, only resuming flights to Lagos when the central bank released $265mn of the estimated $464mn that airlines say it was sitting on.”


From tea to cars, Egypt and Tunisia struggle to pay for imports…

“Supermarket shelves in Tunisia have been stripped bare in recent weeks. Cooking oil, coffee, sugar and butter are all hard to find, especially outside the capital. Some supermarkets even ration bottled water. Shoppers at malls in Cairo had a similar experience all summer: stocks of consumer goods, from clothing to furniture, are running low.”


Israel risks crossing Hezbollah ‘red line’ as it prepares to connect to disputed gas field…

Lebanon, which is still technically at war with Israel, claims part of the Karish field as its own. Events took a dramatic turn over the summer, after Energean brought a production vessel into the field in June despite protestations from Beirut that the reservoir should not be developed until US-mediated maritime border negotiations which began in 2020 are completed.”


Lebanon currency hits new low, sparking protests…

“Amid the turmoil, the pound plunged to 38,600 against the greenback on Monday, according to websites monitoring the exchange rate, a record low for the beleaguered currency. For decades, the Lebanese pound was pegged at 1,507 to the dollar, meaning that it has lost around 95 percent of its black market value since 2019.”


Climate Change, Political Instability, Economic Crisis: Is Pakistan A Failing State?

“Pakistan has been delineated as a failing state by scholars, researchers, historians and analysts for some time. They base their argument on political and economic instability in the country since 1947. However, if there is anything that can brand Pakistan as a failing state, it is intensification of climate change.”


Iran: Five killed in protests over death of Mahsa Amini who was detained for allegedly violating Iran’s hijab rules.

“Mahsa Amini, 22, fell into a coma and died after being arrested in Iranian capital, Tehran, on Friday. Police say she had a heart attack – but her father has insisted she had no health problems.”


Massive protests after dozens of female students have videos ‘leaked’ in India…

“Punjab chief minister Bhagwant Mann has ordered a high-level investigation into the incident and appealed to students to avoid rumours after protests turned violent. On Sunday morning, several students claimed that videos of at least 60 students bathing were leaked on the internet and that subsequently some girls attempted suicide…”


Photos: War-ravaged Sri Lankan Tamils suffer amid economic crisis…

“Under a blazing sun, a 44-year-old Tamil man tends his rented patch of peanut field in Sri Lanka, only able to move around on his hands because an air raid in 2009 took both his legs and injured his left arm. “I have more difficulties than a daily wage labourer,” said Singaram Soosaiyamutthu…”


Misery deepens in Haiti as unrest rages and water shortages bite.

“Many residents of Haiti’s capital Port-au-Prince have been forced to shelter at home this week as gunfire broke out and burning tires blocked streets during protests over fuel price hikes and crime. The unrest slowed or halted companies that typically deliver water in the city…”


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. And if you are already a subscriber or have donated – thank you! It is an enormous help as the cost-of-living crisis ratchets up here in the UK.

17th September 2022 Today’s Round-Up of Economic News

FedEx warned that a global recession could be coming, as demand for packages around the world tumbles.

Shares of FedEx (FDX) plunged 21% Friday — the biggest one-day drop in its history — after the company warned late Thursday that a slowing economy will cause it to fall $500 million short of its revenue target.

“The weakening global economy, particularly in Asia and Europe, has hurt FedEx’s express delivery business. The company said demand for packages weakened considerably in the final weeks of the quarter.

What’s more, FedEx said it expects business conditions to further weaken in the current second quarter, which runs through November.


Global cargo market sags as softer economy points to gloomy Christmas…

“The Christmas holiday season is usually frantic for air cargo and shippers moving newly launched smartphones, toys, and apparel from factories in Asia to the United States and Europe. But Western retailers including Costco Wholesale Group and Macy’s Inc have found their shelves overflowing with unsold merchandise, suggesting they misjudged demand…”


Oil prices and financial markets brace for recession.

“…a broad range of financial indicators from fixed income, equity and commodity markets, as well as individual share prices for bellwether companies, all point to a significant slowdown in the cycle in the next six months.”


The World Bank has warned that leading central banks risk sending the global economy into a “devastating” recession next year if policymakers raise interest rates too high over the months ahead and stress financial markets.

“The Washington-based organisation called on monetary authorities in the big economies to co-ordinate their actions to reduce the overall amount of tightening.”


[US] Mortgage rates surpass 6 percent for the first time since 2008.

“Mortgage rates shot above 6 percent this week for the first time in 14 years as inflation has remained resistant to the Federal Reserve’s efforts to tamp it down. The dramatically swift escalation has chilled what had been a hot U.S. housing market, increasing pressure on an economy plagued by unremitting inflation.”


Fears that the British economy is already in recession after a slump in retail sales last month triggered heavy selling of the pound on international money markets taking it to a 37-year low against the dollar.

“With average UK wages continuing to fall behind rising prices and the Bank of England expected to push up interest rates next week, sterling fell by more than 1% against the US currency to $1.135, its lowest since 1985.”


The number of companies in England and Wales declared insolvent jumped by 43% in August, according to government data, which adds to concerns for the health of the UK economy.

“Economists are concerned that businesses will increasingly struggle as consumers cut back spending amid high inflation.”


Wood pellet shortages in France cause prices to soar.

“The price of wood pellets is soaring in France due to a growing shortage of the wood-burning stove and pellet stove fuel as people prepare early for winter and more households entering the wood pellet market.”


Aluminium Shortages are Here (and could get much worse). Europe’s Power Crunch Cuts Zinc and Aluminum Capacity in Half.

“Europe has lost about half of its zinc and aluminum smelting capacity within the past year, and a further surge in power prices could knock more plants offline over winter, the region’s biggest metal producers warned.”


German drinks makers suffer as energy crisis hits carbon dioxide supplies.

“A shortage of carbon dioxide is causing German drinks manufacturers to cut production and warn of bankruptcies, in the latest sign of how Europe’s energy crisis is sending shockwaves through the region’s economy.”


How gas rationing at Germany’s BASF plant could plunge Europe into crisis…

“BASF-produced chemicals are used to make anything from toothpaste to vitamins, from building insulation to nappies. It is one of the world’s biggest manufacturers of ibuprofen for painkillers, and its single largest customer industry is the automobile industry…”


Germany takes subsidiary of Russian oil giant Rosneft under state control.

“Germany has taken the German subsidiary of the Russian oil giant Rosneft under state control, putting three refineries into a trusteeship ahead of a partial European embargo on Russian oil at the end of the year. The federal network regulator will become the temporary trust manager of Rosneft Germany…”


Germany Working on Historic Takeover [ie nationalisation] of Three Gas Companies [Uniper, VNG AG and Securing Energy for Europe GmbH]…

“The three companies are central pillars of Germany’s energy infrastructure, bringing gas from all over the world to fire Europe’s power stations, run factories and heat homes. Their physical assets help store and transport energy, while their teams of traders buy and sell billions of euros of contracts each year to keep the continent’s economy afloat and societies stable.”


China’s property woes deepen in August as prices, sales and investment drop.

“Woes in China’s property market worsened in August, with official data showing home prices, sales and investment all falling in August, as a mortgage boycott and developers’ financial strains further hurt confidence in the sector.”


Coronavirus in China: food shortages and chaos reported in locked down Lhasa.

“People are confined to their homes or in hospitals but officials and volunteers are falling sick, leading to supply breakdowns. The city of 860,000 has recorded more than 540 infections so far, along with many more asymptomatic cases.”


Indonesian gig drivers fear hardship after fuel price hike…

“”I sometimes don’t eat a proper meal the whole day to allocate my cash for fuel. If I don’t have fuel, how can I work?,” asked Ridwan, a contractor for Gojek — which alongside Singapore’s Grab is among Asia’s most valuable start-ups.”


What is happening in Venezuela?

The humanitarian crisis in Venezuela was triggered by the economic collapse that began in 2014 and has been deepening ever since. A quarter of the population is in need of aid… The country’s health system has collapsed, and hyperinflation paired with shortages of essential resources such as water, fuel and medicine continue, causing social unrest.”


Lenders urged to cancel Zambia debt as country faces economic collapse.

“More than 100 economists and academics have urged international lenders to crisis-stricken Zambia to write off a significant slice of their loans during financial restructuring talks this month. Zambia is seeking up to $8.4bn (£7.3bn) in debt relief from major lenders, including private funds…”


Zimbabwean bakers’ profits crumble amid Russia-Ukraine crisis…

“The southern African country is already in the throes of an economic crisis due to high inflation. Ninety percent of the country is unemployed, according to the Zimbabwe Congress of Trade Unions (ZCTU) and its manufacturing output is on a decline.”


Nigerian inflation hits 17-year high.

“Inflation in Nigeria hit a 17-year high of 20.5 per cent in August, driven by soaring prices of food, diesel and a weakened currency, data released by the statistics agency on Thursday showed. The Nigerian currency has depreciated by almost 25 per cent against the dollar since the start of the year…”


‘The country is being suffocated,’ say Tunisians weary of food shortages…

“Rationing has become commonplace, while supermarkets and small local shops have yawning gaps on shelves once crowded with everyday products. Government announcements on the food shortages have been confusing, attributing the absence of basic foodstuffs both to speculators and selfish hoarders.”


Lebanese banks to close next week after more branches are stormed.

“Lebanese banks have said they will soon announce a three-day closure next week over mounting security concerns following a series of incidents involving people seeking access to their savings by entering banks armed with guns. On Friday, eight banks were held up by depositors who demanded their own money…”


Over 200 dead in Armenia-Azerbaijan clashes this week.

“Armenia said Friday that at least 135 of its troops died in border clashes with Azerbaijan this week, bringing the overall toll to more than 200 following the countries’ worst fighting in two years. Both sides accuse each other of initiating the clashes, which erupted on Tuesday…”


At least 24 killed in clashes on Kyrgyzstan, Tajikistan border…

“Clashes on the border that began earlier this week grew into large-scale fighting on Friday involving tanks, artillery and rocket launchers. As part of the shelling, Tajik forces struck the regional capital, Batken, with rockets.”


Afghanistan blames border clash on Pakistan’s bid to build post.

“The Taliban government in Afghanistan has blamed the Pakistan army’s attempt to build a security post at their border as the reason behind Tuesday’s cross-border skirmish, causing multiple deaths on both sides, including at least three Pakistani soldiers.”


Sri Lanka’s economy shrinks 8.4% amid fertilizer, fuel shortages.

“Sri Lanka’s economy shrank 8.4% in the quarter through June from a year ago in one of the steepest declines seen in a three-month period, amid fertilizer and fuel shortages during the nation’s most severe financial crisis in more than seven decades.”


Traffic, water shortages, now floods: the slow death of India’s tech hub?

“Last week, after the city’s heaviest rains in decades, the Yemalur neighbourhood was submerged under waist-deep water along with some other parts of Bengaluru… flooding during the monsoon has raised fresh questions about the sustainability of rapid urban development, especially if weather patterns become more erratic and intense because of climate change.”


The World Has a $1 Trillion La Nina Problem.

“It’s all but guaranteed the world will see another year of weather disasters that destroy homes, ruin crops, disrupt shipping and threaten lives… As climate change pushes weather disasters to new extremes… another year of La Nina means the world is hurtling toward $1 trillion in weather-disaster damages by the time 2023 wraps up.


Extreme hunger soaring in world’s climate hotspots, says Oxfam.

“Within the countries studied, 48 million people are currently suffering from acute hunger, up from about 21 million people in 2016. Of these, about 18 million people are on the brink of starvation, according to the Oxfam report published on Thursday.”


UN food chief warns of ‘tsunami of hunger’…

David Beasley, executive director of the UN World Food Programme, said the 345 million people facing acute food insecurity in the 82 countries where the agency operates is two-and-a-half times the number of acutely food insecure people before the Covid-19 pandemic hit in 2020.


You can read the previous “Economic” thread here. I’ll be back on Monday with a “Climate” thread, although the news cycle may be somewhat slow then due to the Queen’s funeral.

If you found value in this content, please help me continue this work by becoming a patron of my work via Patreon. And if you are already a subscriber or have donated – thank you! It is an enormous help as the cost-of-living crisis ratchets up here in the UK.