Gold is still falling in price as investors seek safety in the US dollar in preference to gold, silver and the euro.
Category archives: Political/Economic
Political ‘turmoil’ forecast for 2012-13
A column in the FT forecasts political “turmoil” as 2012 and 2013 bring presidential elections in the US and France, a leadership transition in CHina, and the election of a new chancellor in Germany. “Election pressures threaten to complicate an already very difficult and unpredictable policy dynamic.” http://blogs.ft.com/the-a-list/2011/10/03/2012-elections-portend-even-greater-volatility-than-this-year
Pessimistic outlook for economy, x4
The UK building industry, PwC, the new director general of the IoD all have a pessimistic outlook on the economy. And the Treasury is concerned about the “very great” risks to the UK economy, if the euro were to break apart.
European defence ‘weakened’
As US defence cuts and an increasingly assertive China focus US attention closer to home, European defence cuts and previous reliance on US support through NATO are revealing that Europeans “may no longer have the defence capabilities to look after themselves, or their own backyard, without US help.”
The plenitude economy / plenitude society
As Einstein famously pointed out, you cannot solve a problem by using the same thinking that created the problem in the first place. This short video proposes one idea for how we could move forward: shorten the working week from five days to four, and increase the number of employees (all on lower salaries).
Banks are still creaking
Bank of America is to charge $5/month for use of its debit cards. Wells Fargo and JP Morgan are testing similar fees, at $3/month. The economic system must be winding itself tighter and tighter if they are having to resort to this kind of action to stay afloat. http://www.thedailybeast.com/cheats/2011/09/29/boa-announces-5-debit-fee.html
European banks innovate
Unsecured debt has traditionally been a core part of the business of many european banks. In the face of the eurozone crisis, and looming new regulation, those banks are shifting to secured debt (“covered bonds”) but also new financial instruments that sit somewhere between ‘covered’ and ‘uncovered’.
Meanwhile, in an emerging economy not far away…
Brazil’s inflation is above target. The central bank cut interest rates by 0.5% at the end of August, on the expectation that slower global growth would hurt Brazil’s exporters. That may well happen, but the immediate impact has been a rise in domestic inflation, to just over 7%.
Expected long term US inflation falls
Projetions for US inflation over the next 30 years have fallen to just under 2%. You might say that growth expectations are similarly low. http://www.ft.com/cms/s/0/cdfa208e-e912-11e0-ac9c-00144feab49a.html
New taxation “would benefit investors”
Discussion around the introduction of a ‘Tobin Tax’ is increasing. The tax would benefit long term investors and increase transaction costs of short-term investors. This would bring more (systemic) stability to the markets. The German and French governments are in favour, as is Bill Gates. The UK government wants London to opt out.