Föhrenbergkreis Finanzwirtschaft

Unkonventionelle Lösungen für eine zukunftsfähige Gesellschaft

Posts Tagged ‘Recovery’

Europe’s Doom Loop in Reverse

Posted by hkarner - 16. Januar 2018

Unlike before the 2011-2012 crisis, the eurozone seems to be locked in a benign credit cycle, in which lower risk premia allow both banks and governments to refinance at lower rates, more credit is available for the real economy, and the resulting recovery increases government revenue. But how long can this cycle persist?

BRUSSELS – During the 2011-2012 euro crisis, the currency area became mired in a “doom loop,” in which weak banks in financially distressed countries rationed credit, causing a recession that intensified pressure on government finances, which were already burdened by the need to cover banks’ losses. But such self-reinforcing spirals can also operate in the opposite direction. Understanding these dynamics may be the key to determining the eurozone’s relative strength today.

In a doom loop, the expectations of default drive up risk premia until the economy reaches the brink of collapse, even if the underlying problems could be managed over time. At a certain point, when the gulf between financial-market pessimism and economic reality becomes too large, the market becomes ready for a reversal. Den Rest des Beitrags lesen »

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Betting On A Greek Recovery?

Posted by hkarner - 14. Dezember 2017

Wednesday, December 13, 2017, Observing Greece

Having just finished our regular 3-month autumn stay in Greece, it’s a good time to reflect on the impressions I could gather and what may be in store for Greece until we return there next spring. Obviously, the all-important questions are: Has Greece really turned the corner (economically, that is)? Are we perhaps witnessing the beginning of an accelerated turn-around? In short: has the time come to bet on a Greek recovery?

There have been different views in recent months. Some, like the reputable American investor Kyle Bass, predicted that „investors are getting ready to pour billions back into the Greek economy„. Others considered talk about Greek economic recovery as „fake news in action„. Today, it was Bloomberg who headlined an article „Betting on the Greek Recovery.

What stands out is that all commentators focus on the macro-side of things: Will Greece successfully exit the program? Will Greece be able to return to markets? Will yields on Greek bonds decline further? Are bank shares rising? Do banks report profits? Etc. Den Rest des Beitrags lesen »

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Record Earnings Boost Confidence in Global Markets Rally

Posted by hkarner - 6. Dezember 2017

Date: 05-12-2017
Source: The Wall Street Journal

Earnings per share hit new high, underscoring broad economic recovery

Listed companies are at their most profitable on record after a bumper year of earnings growth across global equity markets.

The earnings-per-share of a FactSet index of over 20,000 listed companies from around the world has now reached an average of $9.69, increasing nearly 19% in the last year.

That is the fastest year-over-year rise since 2011, surpassing the late-2014 high of $9.55. While the FactSet data only stretch back to 2001, increased earnings in emerging markets like China, among other factors, mean that the per-share level has likely never been higher. Den Rest des Beitrags lesen »

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The Eurozone’s Challenge: Don’t Waste the Recovery

Posted by hkarner - 17. Oktober 2017

Date: 16-10-2017
Source: The Wall Street Journal By Simon Nixon

The bloc’s robust recovery is an opportunity to strengthen its resilience to future shocks—but will governments grasp it?

French President Emmanuel Macron, and German Chancellor Angela Merkel have different priorities when it comes to reforming the eurozone’s architecture.

The International Monetary Fund had a clear message for economic policy makers gathered in Washington for its annual meetings last week: don’t waste a recovery. The global economy is enjoying a robust upswing, so governments should fix the roof while the sun is shining.

It was a message directed particularly at the eurozone. The strength of the currency bloc’s recovery has taken almost everyone by surprise, not least the IMF, which upgraded its forecast for eurozone growth in 2018 by 0.2 percentage point to 2.1% compared with its July forecast, putting it on a par with the U.S. This recovery is both broad-based, spanning all countries and sectors, and well-balanced—with household spending, exports and investment all playing their part. Den Rest des Beitrags lesen »

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What’s Really Behind the Eurozone’s Economic Turnaround

Posted by hkarner - 15. August 2017

Date: 14-08-2017
Source: The Wall Street Journal By Simon Nixon

Many economists may have underestimated the role of improvements to the supply side of the eurozone economy

It is now four years since the start of the remarkable Spanish economic recovery. Yet at the time, few saw it coming. Back in July 2013, the International Monetary Fund forecast that it would take until 2018 for Spanish economic growth to barely scrape above 1% while unemployment would remain above 25% for five years.

In fact, the Spanish turnaround had already begun: Growth exceeded 1% in 2014 and has been above 3% ever since. In that time, Spain has created more than two million jobs, bringing the unemployment rate down from a peak of 26.2% to an eight-year low of 17.2% today. Den Rest des Beitrags lesen »

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Recovery is Not Resolution

Posted by hkarner - 2. August 2017

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Explaining Global Recovery Amid Political Recession

Posted by hkarner - 2. August 2017

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Europe’s Rocky Recovery

Posted by hkarner - 29. Juli 2017

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The Global Recovery’s Downside Risks

Posted by hkarner - 6. Juni 2017

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Keen, Hudson Unpick Historical Path to Global Recovery

Posted by hkarner - 4. Dezember 2016

By  Hudson,  Hudson

REAL VISION INTERVIEW TRANSCRIPT:

Featuring: Michael Hudson, Steve Keen
Published date: 22nd of November 2016

Synopsis: With two renegade economists in one room in London for 90 minutes you can expect some pretty controversial opinions about the current economic establishment. This film has all the makings of a Real Vision classic, as Steve Keen interviews professor and author, Michael Hudson, sharing their radical views and an extraordinary depth of knowledge.

Discussing the complacency and complicity of traditional economic models, as taught in universities and adopted by central banks, Michael and Steve take us on a journey from a solar system to a galaxy of thought, taking in the history of economics to solutions for the ongoing global depression.

Highlights:

Michael Hudson: Killing the Host will be published in German at the end of the month of November. Basically, it’s a more popular version of The Bubble and Beyond. It shows that when the financial sector takes over, it’s very much like a parasite in nature. People think of parasites simply as taking the life blood of the host and draining the energy. But in order to do that, the parasite has to have an enzyme to take over the host’s brain. They take over the brain and convince the host that the free luncher is actually part of the host’s own body, and even its baby to be protected. That’s what the financial sector has done. Den Rest des Beitrags lesen »

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