GeoPolitical Futures title: China as a Lender of Last Resort GPF subtitle: Beijing's high interest loans have been criticized for creating “debt traps” for cash-strapped borrowers. By: Geopolitical FuturesDate: 31 March 2023 "China has become a major rescue lender for heavily indebted countries. In 2022, loans to countries in debt distress accounted for 60 percent...
Banking
The rich world’s housing crunch is far from over (The Economist)
7 Apr, 2023
The Economist title: The rich world’s housing crunch is far from over The Economist subtitle: Markets can be split into three camps: early adjusters, bullet-dodgers and slow movers Date: 2 April 2023 "At times during the long boom that followed the global financial crisis of 2007-09, it seemed as if house prices would never stop rising. Sales surged as a cocktail of...
The inflation-recession cycle
6 Apr, 2023
My blog of yesterday, Inflation + falling house prices = ?, might have suggested that inflation and a recession are independent. Well, a period of inflation is usually indeed followed by a recession. The diagram below shows their relationship in time. Unfortunately, that diagram does not show the trigger. SOURCE of diagram The missing link between inflation and a...
Inflation + falling house prices = ?
5 Apr, 2023
Many countries are experiencing an apparent anomaly: inflation + falling house prices. IMF-2023: "Global housing markets are retreating after years of steady gains". "Two-thirds of the economies for which the OECD tracks housing prices saw declines for their most recent quarter of available data." Some examples: Australia, Canada, Denmark, Ireland, Netherlands, New...
Inflation: demand versus supply-side
4 Apr, 2023
Usually, inflation is caused by excess demand (eg, business, consumers). The common Central Bank policy is to reduce demand by raising interest rates. Generally, it takes time before a lower inflation becomes visible. A policy of reducing interest rates creates hyperinflation (eg, Turkey). There is, however, another cause: supply-side inflation. "A damaged supply...
China’s Demographic Balloon Is Rapidly Losing Altitude (WSJ)
18 Feb, 2023
Wall Street Journal title: China’s Demographic Balloon Is Rapidly Losing Altitude WSJ subtitle: Country’s population decline isn’t just about fewer low-cost workers. It will hit China’s development strategy in another way, too. By: Nathaniel Taplin Date: 13 February 2023 "Beijing has spent the past week needling Washington over the forcible deflation and subsequent...
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