Global Economy-Bad Days Are coming

[50 shades of black + 254]

One of the International Monetary Fund’s top officials warned on Tuesday that storm clouds were gathering over the global economy and that governments and central banks might not be well- equipped to cope. The fund had been urging governments to “fix the roof” during a sunny last two years for the world economy, IMF First Deputy Managing Director David Lipton said. “But like many of you, I see storm clouds building, and fear the work on crisis prevention is incomplete,” he said at a banking conference hosted by Bloomberg. He also warned that strains could leave policymakers under pressure and in uncharted waters. “Central banks would likely end up exploring ever-more unconventional measures. But with their effectiveness uncertain, we ought to be concerned about the potency of monetary policy.” Many governments won’t have much room for manoeuvre, either, having already racked up high debts. “We should not expect governments to end up with the ample space to respond to a downturn that they had 10 years ago,” Lipton said. Stimulus may also be a hard sell politically, considering the financial burden it creates, he said.The biggest immediate risk, though, is the current trade war between the United States and China. If all of the threatened tariffs are put in place, as much as three-quarters of a percent of global GDP would be lost by 2020, the IMF has estimated. “That would be a self-inflicted wound. So it is vital that this ceasefire (recently announced between Washington and Beijing) leads to a durable agreement that avoids an intensification or spread of tensions.” If it doesn’t and a stalemate sets in, there could be a damaging “fragmentation” of the global economy that causes a downturn, he said.

[pinto + 293]

Bullish or bearish?

[Petar + 76]

Simply, just ignore the IMF ! What did it say before the financial crisis in 2008?

[Pavel + 384]

It’s pretty obvious...Welcome to 2008 (soon or later)

[rainman + 263]

Yet another warning. But is anyone listening?

[50 shades of black + 254]

Call for a new multilateralism that focuses on building strong national and global defenses. Ok. But, it's necessary to include extracting domestic banks from loony multilateral Basel Accord...

[DA? + 301]

Let the weak companies go under this time.

[ThunderBlade + 231]

So, Fund needs more resources? In other words the rich and greedy want all your money.

[jaycee + 348]

Economists have predicted 10 of the last 2 recessions.

[Arjun + 39]

These people at the (((IMF))) and (((other))) institutions are the ones pushing chaos on the people so they can profit off the blood. Goldman sachs during the Davos summit right before President Trump landed said "yeah its stable now, but trouble might come soon", was that a slip of the tongue? I dont know.

[AdrianC + 42]

This storm has been brewing for some time and the biggest indicator is a current shift in global trade. While the job numbers have recovered, wealth disparity is at its worst as well as job salaries have not risen to meet the need. More people are employed but earning less, pumping less money back into the economy.  And it's not just the US. The same storm is brewing in Europe, best examples are France and Brexit. Many EU states are facing with considerable economic problems in the past few years. 

[jaycee + 348]

1 hour ago, AdrianC said:

This storm has been brewing for some time and the biggest indicator is a current shift in global trade. While the job numbers have recovered, wealth disparity is at its worst as well as job salaries have not risen to meet the need. More people are employed but earning less, pumping less money back into the economy.  And it's not just the US. The same storm is brewing in Europe, best examples are France and Brexit. Many EU states are facing with considerable economic problems in the past few years. 

I may have to disagree with you regards the UK, or at least the BBC does ...

https://www.bbc.co.uk/news/business-46520876

Wages are continuing to rise at their highest level for nearly a decade, the latest official Office for National Statistics figures show.

[ronwagn + 6,290]

https://www.cnbc.com/2018/09/25/consumer-confidence-september.html

[ronwagn + 6,290]

1 hour ago, jaycee said:

I may have to disagree with you regards the UK, or at least the BBC does ...

https://www.bbc.co.uk/news/business-46520876

Wages are continuing to rise at their highest level for nearly a decade, the latest official Office for National Statistics figures show.

https://www.marketwatch.com/story/consumer-confidence-falls-for-first-time-in-five-months-2018-11-27

[Andrew Sun + 17]

Gold price is not up in any significate way. Bond yield has gone up and then came back down again. Looks like most people are not worried. The unexpected is more likely when most people are complacent. This is why it's called the Black Swan Event.  But if the unexpected is about to happen, why are gold down and bond yield falling? See this circle keeps going until 2008 hit us all over again 😉

[jaycee + 348]

4 hours ago, Andrew Sun said:

  But if the unexpected is about to happen, why are gold down and bond yield falling?

Gold is not going up due to the very strong $. Personanally I have a lot of money on gold mines betting the $ will crack due to Trump's policies next year.

Edited December 12, 2018 by jaycee

[Clement Obarise + 1]

Global economy is really diminishing at its pace as some African countries are really surviving on loan and still recession is brewing.

Unemployment is soaring in most parts of African Countries and Companies are being shut down due to this bad economy effect. Purchasing power is outrageous in mos counties due bad state of economy and people's needs may not be met sooner if not nip at the bud.

Economy technocrats are to be up and down to infuse reasonable economic policies to make GDP grows geometrically.

[Danial Gable + 20]

tech boom 1998/99      commoditiy boom  2008/2009      usa equities boom  2018    perfect 10 year cycle.   The biggest hurdle to economic development is the american dollar,  once this crashes, which is happening- the rest of the world can rejoice.  Religion is another barrier and major one at that.   Unethical religious belief systems will undermine humanities true potential.   Donald Trump will solve the us dollar issue, and drive into the ground. The deeply disturbing religious wars that destroy future generations of  education prosperity and productivity.  War and war like behaviour is not the awsner for true prosperity, and if you dont believe me, just ask Xi......

[Dan Warnick + 6,100]

Credit is the #1 thing that has the potential to bring all other problems to bear.  Everything from countries to individuals have taken on way too much credit and no real value is being put back into the system, so credit is driving what is perceived as value.  Even stock buybacks are a sign of the fact that new value has not been put back into the system.  Buybacks bring value to existing shareholders by increasing the stock price, but they bring no additional value to new investors.  That can not be sustained.  Zero interest rates also made central banks cash poor.  What the U.S. Fed is doing by raising the rates is sucking cash back into the Fed in hopes of having some tools to fight the next crash.  But it won't be enough if the figures are right.  There is apparently 40% more debt outstanding than there was in 2008, which makes sense because companies and countries borrowed their way out of the problems back then and now the debt collector cometh and they don't have the cash.  Also those ultra-dangerous derivatives are even more entrenched into markets and debts; Tens of Trillions more.

[BHUPINDER KUMAR + 6]

I dont think so... China and India are doing well on their terms .. The RBI (central bank of India ) follows strict rules and does not play in the hands of the Govt.  There could be more credit flow in the Indian mkt soon but I don't see bad days.... IFM thinks from bookish.... knowledge ... Each society has its own mechanism to defend itself 

[Andrew Sun + 17]

On 12/13/2018 at 12:48 AM, BHUPINDER KUMAR said:

I dont think so... China and India are doing well on their terms

Do you know of a place where we can find data on how the Indian economy gets negatively affected when the Chinese GDP number slips?

By most indicators, the Chinese economy is already slowing down. Part of it is structural, part of it is due to Trump. If they hit their target this year, they may not be able to do so again in 2019. Of course the Chinese Bureau of National Statistics can always change their target to make themselves look good

Also, the Chinese can always do another round of debt fueled infrastructure spending to get out of trouble like they did back in '08 and '09. But kicking the can down the street won't make the problem go away and will definitely make the problem worse down the road. So looks like they may actually do the right thing this time and use this as an opportunity to help them deleverage.

[ronwagn + 6,290]

On 12/12/2018 at 3:44 AM, Clement Obarise said:

Global economy is really diminishing at its pace as some African countries are really surviving on loan and still recession is brewing.

Unemployment is soaring in most parts of African Countries and Companies are being shut down due to this bad economy effect. Purchasing power is outrageous in mos counties due bad state of economy and people's needs may not be met sooner if not nip at the bud.

Economy technocrats are to be up and down to infuse reasonable economic policies to make GDP grows geometrically.

Is part of the problem due to mass migration from rural to urban areas. America developed as a rural agrarian society. It seems that Africa could do so also. You also have all the modern technology and tools. 

[BHUPINDER KUMAR + 6]

On 12/15/2018 at 3:33 AM, Andrew Sun said:

Do you know of a place where we can find data on how the Indian economy gets negatively affected when the Chinese GDP number slips?

By most indicators, the Chinese economy is already slowing down. Part of it is structural, part of it is due to Trump. If they hit their target this year, they may not be able to do so again in 2019. Of course the Chinese Bureau of National Statistics can always change their target to make themselves look good

Also, the Chinese can always do another round of debt fueled infrastructure spending to get out of trouble like they did back in '08 and '09. But kicking the can down the street won't make the problem go away and will definitely make the problem worse down the road. So looks like they may actually do the right thing this time and use this as an opportunity to help them deleverage.

 

[BHUPINDER KUMAR + 6]

My sincere apologies for responding late.... Yes you may get the data ... from me .. or any info you may need... please be specific... bhupinderkumarhans@gmail.com 

[Tom Kirkman + 8,860]

The Climate Change crowd should get together with the IMF crowd and have an End Of The World Party.  Preferably on a lost island in the middle of nowhere, and with no internet.