Wednesday, December 25

Global Economics

Looking at economic forecasts for the global economy and the impact of national and multinational policies.

Looking At The Economic Effects Of Russia’s War
7Mar By Patti MohrNo Comments
Energy Policy, Oil & Gas, Global Economics, Types of News: Analysis

Looking At The Economic Effects Of Russia’s War

Energy Price Spikes Lead Economic Impact Of War March 7, 2022—By far, the greatest cost of Russia's war against Ukraine is the humanitarian costs: the lives lost, the forced displacement, and the psychological trauma. As the world faces down Russia's aggression, we also need to recognize and prepare for the economic effects. The battle and emerging breakdown of global trade are also having an economic impact, and it is helpful for individuals to brace themselves for that. "The near-term effects on the U.S. economy of the invasion of Ukraine, the ongoing war, the sanctions, and of events to come, remain highly uncertain," Federal Reserve Chair Jerome Powell said recently. "We will need to be nimble in responding to incoming data and the evolving outlook."-House Financial Service...
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As Sanctions Against Russia Ramp Up, US Blocks Central Bank
28Feb By Patti MohrNo Comments
Currency, Debt, National Budgets & Interest Rates, Global Economics, Globalization, Global Disintegration, Sanctions, Types of News: Brief

As Sanctions Against Russia Ramp Up, US Blocks Central Bank

The Russian Ruble fell Monday to its lowest level on record. February 28, 2022--The United States added Russia's central bank to its list of targeted sanctions against that country's war on Ukraine. As a result, Americans are barred from doing any business, such as purchasing bonds, with Russia's central bank. The block on the secondary market for ruble or non-ruble denominated bonds for U.S. investors goes into effect immediately. Furthermore, the U.S. Treasury imposed sanctions on Russia's National Wealth Fund, its Ministry of Finance, and the Russian Direct Investment Fund, its CEO and two of its subsidiaries. Global Sanctions in Action Banks around the world started implementing sanctions imposed not only by the United States, but also the European Union, United Kingdom, Ca...
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Status of the World’s Vaccination Levels
15Jan By Patti MohrNo Comments
Global Economics, Organizations, IMF, WTO, G7, Types of News: Brief, Types of News: Infographic

Status of the World’s Vaccination Levels

Vaccination Status Varies Widely By Country January 15, 2022--With the recent toss up over tennis great Novak Djokovic's vaccination status in the land down under, it is worth looking at the wider story of the vaccine distributions around the world. In terms of global health and economic recovery from the 2020-2022 pandemic, there is no issue more relevant than vaccine distribution. Even though the current makeup of vaccines are not strong enough to prevent infection with the Omicron variant, as the World Health Organization acknowledged this week, anecdotal evidence suggests they still prevent worst-case scenarios for the people who catch it. The maps below show which countries are on track for achieving mass vaccination and which are not. In the first picture, the depiction show...
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US Inflation Climbs Higher To 7 Percent
12Jan By Patti MohrNo Comments
Currency, Debt, National Budgets & Interest Rates, Global Economics

US Inflation Climbs Higher To 7 Percent

January 12, 2022--After a year of rising prices in the United States, U.S. inflation climbed even higher in December. Even with energy prices dipping down in the month, the Consumer Price Index rose 0.5 percent, bringing inflation up to 7 percent for the year. To date, the U.S. Federal Reserve has held its federal funds rate near record lows. It is currently at 0.8 percent, despite the rising consumer prices. At his confirmation hearing in the Senate Banking Committee yesterday, Federal Reserve Chairman Jerome Powell said the central bank would respond to rising inflation. ItemPrice Change (as a percent)All Items7Food6.3Food At Home6.5Food Away From Home6Energy29.3Energy Commodities48.9Gasoline49.6Fuel Oil41Energy Services10.4Electricity6.3Utility Piped Gas24.1Commodities (not inclu...
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Central Banks Fuel Stock Market Expansion in 2021
30Dec By Patti MohrNo Comments
Currency, Debt, National Budgets & Interest Rates, Finance, Investing, Global Economics, Types of News: Analysis

Central Banks Fuel Stock Market Expansion in 2021

Low-Interest Rate Environment Also Contributing To Rising Cost of Housing December 30, 2021--With near-zero interest rates by central banks in the United States and Europe, companies raised $12 trillion in 2021 sales of stocks, bonds, and new loans. That's up 17 percent from 2020, according to reporting by the Financial Times. Low-interest rates make borrowing easier and increase the money supply. The downside is they encourage riskier investments, benefit those who already own assets, and can skew the societal risk toward inflation. In effect, investors benefit while consumers pay more. Cash to Keep Flowing in 2022 The trend is likely to continue in 2022. Research by J.P. Morgan suggests the U.S. Federal Reserve will continue a "broadly accommodative" policy despite its tape...
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Eurozone Inflation Varies Widely By Country
28Dec By Patti MohrNo Comments
Currency, Debt, National Budgets & Interest Rates, Global Economics, Types of News: Brief

Eurozone Inflation Varies Widely By Country

As the euro-area grows, so does euro-area inflation rate. Overall, the inflation rate reached 4.9 percent by year's end. Some see the rise in prices moderating next year. While others see it persisting and posing a threat to the economic recovery. With the rise in oil prices and supply bottlenecks making global trading more expensive in 2021, consumers around the world are coping with higher prices. Central banks in Europe and the United States are beginning to reduce their stimulus programs. Yet the European Central Bank plans to continue purchasing assets, albeit at a slower pace, while maintaining its policy of zero-to-negative interest rates into 2022. What's interesting is that the inflation rate varies widely in the eurozone, from a moderate 2.2 percent annualized increase in ...
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Fed Keeps Funds At Near Zero, Focuses on Labor Participation Rate
15Dec By Patti MohrNo Comments
Currency, Debt, National Budgets & Interest Rates, Global Economics

Fed Keeps Funds At Near Zero, Focuses on Labor Participation Rate

December 15, 2021--Despite high and rising inflation, the U.S. Federal Reserve decided today to keep its federal funds rate between zero and 0.25 percent. The Federal Reserve statement acknowledged that inflation has "exceeded 2 percent for some time." Furthermore, the unemployment rate is at 4.2 percent--which is significantly close to the 4 percent target that Federal Reserve Chair Jerome Powell mentioned in March. Defining Employment In his comments to reporters in a virtual conference held today, Powell seemed to expand the definition of "maximum employment" that the Fed has traditionally considered. For example, asked to define maximum employment, Powell discussed not only the unemployment rate but also "a broad range of indicators" including: the labor participation rate...
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U.S. Treasury Breaches $28.9 Trillion Debt Limit
30Nov By Patti MohrNo Comments
Currency, Debt, National Budgets & Interest Rates, Global Economics, Types of News: Brief

U.S. Treasury Breaches $28.9 Trillion Debt Limit

Treasury Secretary Yellen Says Uncertainty Exists Over Cash Balance On Dec. 15 November 30, 2021—The U.S. government breached its $28.9 trillion debt limit and is using extraordinary measures to borrow money to pay its bills, the Congressional Budget Office reported today. The CBO outlined the extraordinary measures the government is currently taking to stay afloat. The U.S. government has "no room to borrow under its standard operating procedures," the CBO said. If the Treasury transfers $118 billion to the Highway Trust Fund on December 15, as the recently passed Infrastructure Investment and Jobs Act directs it to do, it is likely to run out of cash. Running on Empty If the U.S. government runs out of options, it "would ultimately lead to delays of payments for some governme...
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Fed Comes Under Pressure As Inflation Persists
30Nov By Patti MohrNo Comments
Currency, Debt, National Budgets & Interest Rates, Global Economics, Types of News: Brief, Types of News: Videos

Fed Comes Under Pressure As Inflation Persists

Fed Chair Says Inflation Now Likely To 'Linger Well Into Next Year' November 30, 2021—After months of downplaying inflation as a temporary condition, U.S. Federal Reserve Board Chair Jerome Powell said inflation has now spread much more widely beyond the sectors impacted by supply chain bottlenecks. 'Transitory' No More "I think it's probably a good time to retire that word and explain what we mean," Powell told senators at a Banking Committee hearing. Surging Economic Growth The U.S. economy is now growing at 5 percent, which is the "fastest pace in many years," Powell said. Meanwhile, the unemployment rate is down to 4.6 percent. Asked by Sen. Jack Reed, D-R.I., about the drop in the U.S. labor participation rate, Powell said fears about the pandemic are the likely cause. ...
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WHO ID’s Omicron As Covid ‘Variant of Concern’
26Nov By Patti MohrNo Comments
Global Economics, Types of News: Brief

WHO ID’s Omicron As Covid ‘Variant of Concern’

Governments And Markets React To Variant Found in South Africa November 26, 2021--The World Health Organization identified a new variant, called Omicron, as a cause for concern on Friday and established a technical advisory group to study it. It comes as much of the world tries to recover from economic recessions due to the global pandemic. "This variant has a large number of mutations, some of which are concerning. Preliminary evidence suggests an increased risk of reinfection with this variant, as compared to other VOCs," said the WHO release. Financial markets reacted worldwide as governments instituted travel bans and braced for the potential for infection rates to rise. The scientific name is SARS-CoV-2 variant: B.1.1.529. Since scientists first discovered it on November...
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