Posts belonging to Category real estate



Why is Deflation a Central Bank’s Worst Nightmare?

In US consumer spending accounts for 70% of the economy

Once deflation sets in, it can take decades for an economy to break out of its grip—Japan is still trying to climb out of a deflationary spiral dubbed the Lost Decades that began in 1990. But what can central banks do to fight the pernicious and devastating effects of deflation? In recent years, central banks around the world have used extreme measures and innovative tools to combat deflation in their economies. Below, we discuss how central banks fight deflation. Deflation is defined as a sustained and broad decline in price levels in an economy over a period. Deflation is the opposite of inflation and is also different from disinflation, which represents a period when the inflation rate is positive but falling.

https://www.investopedia.com/

China starts to impose additional tariffs on some U.S. goods

Beijing started levying a 5% tariff on U.S. crude oil

Dell Technologies Inc (DELL.N) beat Wall Street profit estimates on

China on Sunday started to impose additional tariffs on some of the U.S. goods on a $75-billion target list, with effect from 0401 GMT.

The extra 5% and 10% tariffs were levied on 1,717 items of a total of 5,078 products originating from the United States. Beijing will start collecting additional tariffs on the rest of the items from Dec. 15.

Beijing started levying a 5% tariff on U.S. crude oil from Sunday, the first time U.S. oil has been targeted since the world’s two largest economies started their trade war more than a year ago.

https://www.reuters.com/

Paul Krugman: ‘Real Amnesia’ Around Financial Crisis

Next ‘Will Be Worse’

No one knows exactly what will cause the next financial crisis, not even a Nobel Prize-winning economist like Paul Krugman. ‘We are poorly prepared to deal with the next shock. Interest rates are still close to zero in the US and in most of the rest of the advanced world. The fiscal policy we did was badly handled in the aftermath of the 2008 crisis, and there’s no particular reason to think it will be better. In fact, there’s good reason to think it will be worse.”
Surveying the global economy, there is nothing obvious to point to — like the housing bubble in 2007 —as the next big thing primed to crash the markets. Five charts prove that the stock market is on the cusp of crashing by 70%, maybe more.  
The biggest red flag, Krugman says, is selective memory as to why the last crisis happened in the first place, particularly when it comes to shadow banking — institutions that look and function like banks but are not regulated like banks. Economists pointed at the loosely regulated market for repurchase agreements — short-term loans offered to institutional investors — as one of the main culprits behind the last financial crisis.
http://www.moneyandmarkets.com

Irish government : Brexit talks 'could collapse at any moment'

Negotiations could break down over the border issue

There is renewed fear within the Irish government that Brexit talks could collapse over the UK government’s refusal to consider staying in a customs union with the European Union. enior figures in the Irish government said privately that they fear that Theresa May’s insistence on leaving the customs union will make a hard border impossible to avoid and lead to a complete break down in negotiations.
A high-ranking member of the Irish government said “talks could collapse at any moment” in a meeting with a prominent British MP this month, a source familiar with the meeting has told Business Insider. The Irish government did not wish to comment when contacted by BI.
The EU’s chief Brexit negotiator, Michel Barnier, said on Friday that border checks between Northern Ireland and the Republic of Ireland are “unavoidable” if Britain decides to leave the customs union and single market.

http://www.businessinsider.com…  Febuary 12, 2018

US: $1.5 trillion in infrastructure spending

Trump is looking for help from Congress

President Donald Trump called on the U.S. Congress on Tuesday to pass legislation to stimulate at least $1.5 trillion in new infrastructure spending.
In his State of the Union speech to Congress, Trump offered no other details of the spending plan, such as how much federal money would go into it, but said it was time to address America’s “crumbling infrastructure.”
Rather than increase federal spending massively, Trump said: “Every federal dollar should be leveraged by partnering with state and local governments and, where appropriate, tapping into private-sector investment.” The administration has already released an outline of a plan that would make it easier for states to build tollways and to privatize rest stops along interstate highways.
http://www.reuters.com…  January 31, 2018

Trump angers US solar installers with panel tariff

Job creator, or job killer?

U.S. President Donald Trump signed into law a steep tariff on imported solar panels on Tuesday, a move billed as a way to protect American jobs but which the solar industry said would lead to thousands of layoffs and raise consumer prices.
The 30 percent tariff on solar panels is among the first unilateral trade restrictions imposed by the administration as part of a broader protectionist agenda to help U.S. manufacturers, but which has alarmed Asian trading partners that produce lower cost goods. The administration also introduced a tariff on imported washing machines. “You’re going to have people getting jobs again and we’re going to make our own product again. It’s been a long time,” Trump said as he signed the order.
But the solar industry countered that the move will raise the cost of installing panels, quash billions of dollars of investment, and kill tens of thousands of jobs, raising questions about whether Trump’s move will backfire by triggering mass layoffs.
http://www.reuters.com…  January 24, 2018

The 1% grab 82% of all wealth

More than $8 of every $10 of wealth created last year went to the richest 1%

That’s according to a new report from Oxfam International, which estimates that the bottom 50% of the world’s population saw no increase in wealth.

“The billionaire boom is not a sign of a thriving economy but a symptom of a failing economic system,” said Winnie Byanyima, executive director of Oxfam International.
The head of the advocacy group argued that the people who “make our clothes, assemble our phones and grow our food” are being exploited in order to enrich corporations and the super wealthy. The study, released ahead of the World Economic Forum in Davos, was produced using data from Credit Suisse’s(CS) Global Wealth Databook.

http://money.cnn.com …  January 22, 2018

Apple to pay $38 billion in cash taxes

 $30 billion U.S. investment plan

Apple Inc (AAPL.O) will open a new campus as part of a five-year, $30 billion U.S. investment plan and will make about $38 billion in one-time tax payments on its overseas cash, one of the largest corporate spending plans announced since the passage of a tax cut signed by U.S. President Donald Trump.
The company has been under increasing pressure to make U.S. investments since the 2016 presidential campaign, when Trump targeted the iPhone maker for making products in Asian factories.
While Apple has announced no plans to change that practice and experts say it would be economically impractical to make iPhones in the United States, the company has begun to emphasize its U.S. economic impact, from developers who sell software on its App Store to the tens of billions of dollars per year it spends with U.S. suppliers.
http://www.reuters.com/ … Thu., 18  January 2018

Who are the world’s 500 richest people?

Bloomberg Billionaires index

The Bloomberg Billionaires Index is a daily ranking of the world’s richest people. Details about the calculations are provided in the net worth analysis on each billionaire’s profile page. The figures are updated at the close of every trading day in New York.
http://www.bloomberg.com… Thu., 28  December 2017

Senate approves GOP tax plan

First overhaul of the US tax code in more than 30 years

In a vote in the early Wednesday morning hours, the Senate approved the final version of the first overhaul of the US tax code in more than 30 years, handing President Donald Trump and congressional Republicans their most significant legislative victory of 2017.
The bill passed along party lines, 51-48 with the final result announced by Vice President Mike Pence who presided over the vote. Sen. Jeff Flake, the last undeclared Republican, voted yes.
http://www.cnn.com… Wed., 20  December 2017

UK could pay £50bn Brexit divorce bill

Bowing to EU pressure

The UK has bowed to EU demands on the Brexit divorce bill in a move that could result in the UK paying £50bn to Brussels, in an attempt to get France and Germany to agree to move negotiations to trade.
Non-stop behind-the-scenes negotiations have led to a broad agreement by the UK to a gross financial settlement of £89bn on leaving the bloc, although the British expect the final net bill to be half as much.
http://www.theguardian.com…  Wed., 29  November 2017

Dark clouds gathering on the horizon' for Britain's economy

UBS upgrades pessimistic forecast for UK growth

he Swiss bank UBS has admitted that the outlook for the UK is not as bad as it thought in the immediate aftermath of the European Union referendum and that the economy is well-positioned to benefit from strong global growth. While uncertainty about the final outcome of Brexit might weigh on economic progress, the bank did not believe it would derail future economic expansion.

UBS forecast that the UK will grow 0.7pc in 2018 has been upgraded to 1.1pc and the bank believes this rate of acceleration will be sustained into 2019. This is still a fairly negative view compared to other economists. The consensus view is that the economy will grow by 1.4pc next year. The Bank of England thinks it will be 1.6pc.

http://www.telegraph.co.uk…  Fri., 24  November 2017

Britain's economy is already weaker because of Brexit

Business investment is being affected by uncertainties

The Bank of England didn’t mince words today on the effect of Brexit on the British economy. “Brexit-related constraints on investment and labour supply appeared to have been reinforcing the marked slowdown,” the central bank wrote in its inflation report.
The BOE added that while Britain was being held back by Brexit, the rest of the world was heading into a period of strong growth. “Uncertainties associated with Brexit were weighing on domestic activity, which had slowed even as global growth had risen significantly,” the bank said.
http://www.msn.com…  Fri.,  03  November 2017

"Brexit is stupidest thing any country has done"

Michael Bloomberg says it is ‘hard to understand why a country doing so well wanted to ruin it’

Michael Bloomberg, the billionaire media mogul and former mayor of New York, has said Brexit is the “single stupidest thing any country has ever done” apart from the election of Donald Trump as US president.
Bloomberg argued that “it is really hard to understand why a country that was doing so well wanted to ruin it” with the Brexit vote, in a series of outspoken remarks made at a technology conference in Boston a fortnight ago.
At that event, Bloomberg, 75, also warned that some workers at the financial media company that bears his name were asking to leave the UK and US because they think the two countries no longer like immigrants and are no longer welcoming.
http://www.theguardian.com…  Wed  25  October 2017

Insurance and Hurricanes

Irma test Florida’s flood insurance 

Hurricane Irma could test a nascent private flood insurance market in Florida that some advocates say is a model for making U.S. flood coverage more affordable and commonplace in high-risk areas. Florida’s private flood insurance market represents a tiny sliver of all flood policies in the state, but if a hurricane does hit Florida later this week, policyholders, industry and the federal government will see how private insurance performs in one of the country’s largest flood-prone markets.

“It’s a new breed of insurance in Florida,” said Loretta Worters, a spokeswoman for the Insurance Information Institute, an industry-funded communications group. “You have these companies that have never been tested for flood. We’ll have to see how it works.” Even before Hurricane Harvey triggered massive flooding in Texas last week, U.S. lawmakers were looking at alternatives to the indebted government-backed model of flood insurance.

http://www.reuters.com…  Wed.,  06  September 2017