Sta Hungry Stay Foolish

Stay Hungry. Stay Foolish.

A blog by Leon Oudejans


China as a Lender of Last Resort (GPF)

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...

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The rich world’s housing crunch is far from over (The Economist)

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...

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The inflation-recession cycle

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...

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Inflation + falling house prices = ?

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...

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Inflation: demand versus supply-side

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...

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China’s Demographic Balloon Is Rapidly Losing Altitude (WSJ)

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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