Föhrenbergkreis Finanzwirtschaft

Unkonventionelle Lösungen für eine zukunftsfähige Gesellschaft

Posts Tagged ‘IMF’

Maintaining Banking System Safety amid the COVID-19 Crisis

Posted by hkarner - 31. März 2020

By Tobias Adrian and Aditya Narain

Today we face economic upheaval potentially more severe than we witnessed during the global financial crisis. The coronavirus pandemic is a different kind of shock. Never before have modern economies shut down at the drop of a hat. From one week to the next, many workers lost their jobs and paychecks. Restaurants, hotels, and airplanes all emptied. And consumers and businesses now face steep losses in income—and potentially widespread bankruptcies.

Pressure on the banking system is growing and higher defaults on debt are imminent. And many now expect a shock to the financial sector similar in magnitude to the 2008 crisis.

Like the health experts, bank supervisors are responding to a fast-moving and extraordinary situation. Den Rest des Beitrags lesen »

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Österreichs Häusermarkt überhitzt: IWF sieht Anzeichen für Blase

Posted by hkarner - 5. März 2020

Dank an H.G.

Um zehn bis 15 Prozent sind die Häuserpreise österreichweit zu hoch, sagt der Internationale Währungsfonds, in Wien sind es sogar 20 Prozent

Die gute Nachricht vorweg: Die österreichischen Banken haben ihre Lehren aus der internationalen Finanzkrise gezogen. Die Institute halten mehr Eigenkapital, könnten also im Notfall einen plötzlichen Einbruch in der Wirtschaft besser verkraften. Strengere Regeln der staatlichen Aufsicht haben ebenfalls dazu beigetragen, dass mögliche Gefahren, die vom Bankensektor ausgehen, heute geringer sind also vor zehn oder 15 Jahren.

So dürfen Kreditinstitute an Haushalte im Wesentlichen keine Fremdwährungskredite mehr vergeben. Die hochriskanten Franken- und Yen-Kredite, die noch in den Büchern der heimischen Institute stehen, werden weniger. Den Rest des Beitrags lesen »

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Finding Solid Footing for the Global Economy

Posted by hkarner - 20. Februar 2020

As the Group of Twenty industrialized and emerging market economies (G-20) finance ministers and central bank governors gather in Riyadh this week, they face an uncertain economic landscape.

After disappointing growth in 2019, we began to see signs of stabilization and risk reduction, including the Phase 1 U.S.-China trade deal. In January, the IMF projected growth to strengthen from 2.9 percent in 2019 to 3.3 percent in 2020 and 3.4 percent in 2021. This projected uptick in growth is dependent on improved performance in some emerging market and developing economies.

Monetary and fiscal policy have been doing their part. In fact, monetary easing added approximately 0.5 percentage points to global growth last year. Forty-nine central banks cut rates 71 times as part of the most synchronized monetary action since the global financial crisis.

But the global economy is far from solid ground. While some uncertainties have receded, new ones have emerged. The truth is that uncertainty is becoming the new normal. Den Rest des Beitrags lesen »

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Fiscal Policies For Women’s Economic Empowerment Get email updates

Posted by hkarner - 19. Februar 2020

By Stefania Fabrizio, Daniel Gurara and Lisa Kolovich

Making sure that opportunities to enter the workforce are fair and rewarding for women benefits everyone. Yet, the average female workforce participation rate across countries is still 20 percentage points lower than the male rate, largely because gender gaps in wages and access to opportunities, such as education, stubbornly persist.

Our new study finds that fiscal policy choices that address gender equality—such as investing in education or infrastructure, developing better sanitation facilities, implementing individual-based tax regimes, and offering parental leave—create more economic opportunities for women, increase growth, and reduce poverty and inequality.

When governments actively promote policies to increase female labor force participation, more women do indeed join the labor force.

Most measures pay for themselves in the long run without additional costs for governments and the added bonus—a larger workforce leads to higher economic activity and growth, which generate additional tax revenue for the country.

Inclusive fiscal policies Den Rest des Beitrags lesen »

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How High Should Government Debt Go? Economists Can’t Agree

Posted by hkarner - 18. Februar 2020

Date: 17‑02‑2020

Source: The Wall Street Journal

Economists warned a decade ago that pushing public debt above about 90% of GDP could hurt the economy. Now some aren’t so sure.

U.K. Prime Minister Boris Johnson, visiting a construction site for the High Speed 2 project in Birmingham Feb. 11, has promised to spend billions on infrastructure.

FRANKFURT—Governments around the world are loading up on debt, taking advantage of record‑low borrowing costs to extend a long economic expansion and invest for future challenges.

Economists warned a decade ago that pushing public debt above about 90% of gross domestic product could hurt growth and increase the risk of crises.

Now they aren’t so sure.

In a world of ultralow interest rates, some say higher public debt levels are feasible, even desirable. If sovereign‑bond yields remain below economic growth rates, governments should be able to issue debt without having to pay for it later, argue economists including Olivier Blanchard, former chief economist of the International Monetary Fund. Den Rest des Beitrags lesen »

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Debt will kill the global economy. But it seems no one cares

Posted by hkarner - 7. Januar 2020

Date: 05‑01‑2020

Source: The Observer

Warnings from the IMF and World Bank have been dismissed. But even if they are wrong, a demographic crisis looms

The IMF says that large amounts of corporate debt in eight key economies could become unserviceable in the event of a recession.

The warning signs are clear. Debt is rising on every continent and especially in the business sector, which has spent the past decade ramping up its borrowing to previously unheard‑of levels.

Last October, the International Monetary Fund said that almost 40% of the corporate debt in eight leading countries – the US, China, Japan, Germany, Britain, France, Italy and Spain – would become so expensive during a recession that it would be impossible to service. In other words, tens of thousands of businesses, employing millions of people, would have gambled with high levels of borrowing and lost, making themselves insolvent.

Worse, the IMF said the risks were “elevated” in eight out of 10 countries that boasted systemically important financial sectors, adding that this situation was a repeat of the years running up to the last financial crisis.

Last month, the World Bank joined in. It said emerging‑market and developing economies (EMDEs) had pushed their borrowing to a record $55 trillion (£42tn) in 2018. Den Rest des Beitrags lesen »

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The Economic Cost of Devaluing “Women’s Work”

Posted by hkarner - 31. Dezember 2019

Kristalina Georgieva, Cristian Alonso, Era Dabla-Norris, and Kalpana Kochhar

As much as half of the world’s work is unpaid.  And most of it is done by women.

This imbalance not only robs women of economic opportunities. It is also costly to society in the form of lower productivity and forgone economic growth. It follows that a fairer allocation of unpaid work would not only benefit women, but would also lead to more efficient work forces and stronger economies.

For these reasons, reducing gender imbalances in unpaid work is part of the United Nations Sustainable Development Goals.

Examples of unpaid work include cooking, cleaning, fetching food or water, and caring for children and the elderly.  These tasks are not counted as part of economic activity because they are difficult to measure based on values in the marketplace. Yet their economic value is substantial, with estimates ranging from 10 to 60 percent of GDP.

In our new study, we find that unpaid work declines as economic development increases particularly because there is less time spent on domestic chores. Social institutions and values can constrain the redistribution of unpaid work by preventing men from sharing the burden at home.

Unpaid work declines as economic development increases.

Overworked and underpaid Den Rest des Beitrags lesen »

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Striking the Right Balance Between Sustainable Development and Sustainable Debt

Posted by hkarner - 20. Dezember 2019

By Kristalina Georgieva

Over the past two decades, sub-Saharan Africa has made considerable economic progress: extreme poverty levels have declined by one third; life expectancy has increased by a fifth; and real per capita income has grown by about 50 percent on average. Yet, sub-Saharan Africa is still only half-way to meeting the Sustainable Development Goals.

To achieve these goals, sub-Saharan Africa will need financing. One of the ways to access financing is through borrowing. It makes sense for governments to incur debt if done wisely. If debt is used to finance projects that boost productivity and living standards, such as investing in roads, schools, and hospitals—and if governments can recoup enough of the benefits of these investments to repay the incurred debt—then borrowing is worthwhile.

But room for borrowing has become more limited in this region as public debt levels increased rapidly between 2011 and 2016—they have since stabilized at around 55 percent of GDP on average. Countries in the region have also relied more heavily on commercial borrowing on domestic and international financial markets—such borrowing accounted for more than 70 percent of the increase in debt stock this decade. This shift to non-concessional financing means more spending on debt service, and less on social and infrastructure investment. Den Rest des Beitrags lesen »

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2019 in Review: The Global Economy Explained in 5 Charts

Posted by hkarner - 19. Dezember 2019

By Gita Gopinath, Gian Maria Milesi-Ferretti, and Malhar Nabar

Global growth this year recorded its weakest pace since the global financial crisis a decade ago, reflecting common influences across countries and country-specific factors.

Rising trade barriers and associated uncertainty weighed on business sentiment and activity globally. In some cases (advanced economies and China), these developments magnified cyclical and structural slowdowns already under way.

Further pressures came from country-specific weakness in large emerging market economies such as Brazil, India, Mexico, and Russia. Worsening macroeconomic stress related to tighter financial conditions (Argentina), geopolitical tensions (Iran), and social unrest (Venezuela, Libya, Yemen) rounded out the difficult picture. Den Rest des Beitrags lesen »

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The Power of Text: How News Sentiment Influences Financial Markets Get email updates

Posted by hkarner - 17. Dezember 2019

By Damien Puy

How do investors react to news? This question has been at the core of the financial research agenda for several decades. Now, two forces make this question even more pressing.

First, innovations in information technologies have dramatically increased the reach of financial and economic news and the speed at which it travels. Real time newswires, such as Reuters and Bloomberg, generate and disseminate information almost instantaneously to an ever-increasing set of market participants.

Second, a growing number of countries, especially emerging markets, have opened their financial markets to the rest of the world. This makes it possible for foreign news to affect local market conditions much more directly.

For a long time, however, studying the impact of news on investors’ behavior and asset prices remained a daunting task. What is news exactly? What does it talk about? And how can we identify, in a systematic way, good (or bad) news? Den Rest des Beitrags lesen »

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