Tag: World Recession

Why Not Use Patriotism To Help The Economy?

Politicians have used patriotism for everything from going to war to selling stupid little magnets…..maybe they should try it to sell the recovery of the economy…….China is!

China’s securities watchdog has resorted to investors’ patriotism to help stabilise volatile markets, urging firms not to let diving stocks tarnish the 60th anniversary of the Communist Party‘s rule.Brokerages and fund managers have been told their “top duty” was to protect social stability by helping the market keep an even keel, a memo distributed by the Shanghai branch of the China Securities Regulatory Commission said.

“A stable and safe capital market is related to vital interests of investors, stability of the economy and financial market and the overall situation of social harmony and stability,” it said in the memo seen by AFP and dated Thursday. National Day takes place on October 1.

The notice was issued after the benchmark index slumped 6.74 percent on Monday, the biggest single fall in 14 months as concerns mount over slowing lending growth and a new share supply glut.

Analysts have said policy decisions, rather than economic fundamentals or company balance sheets, are often the main drivers in the nation’s stock markets.

If  it works for China will the politicians try and repackage a Communist policy to fit the capitalism of the US?  Interesting question huh?

A Fossil Of Days Gone By

The Prez has made a trip to Itlay to meet with the leaders of countries of the G8 and a couple of other guest countries.

From the NY Times:

While the richest countries have produced the bulk of the pollution blamed for climate change, developing countries are producing increasing volumes of gases. But developing countries say their climb out of poverty should not be halted to fix damage done by industrial countries.

As various sides tried to draft an agreement to sign Thursday, those tensions scuttled the specific goals sought by the United States and Europe. The proposed agreement called for worldwide emissions to be cut 50 percent by 2050, with industrial countries cutting theirs by 80 percent. But emerging powers refused to agree because they wanted industrial countries to commit to midterm goals in the next decade and to follow through on promises of financial and technological help for poorer nations.

They are trying to tackle all problems and issue a statement…but the G8 is a dinosaur of the 20th century that needs to be displayed with other dinosaurs in a museum.  It should be shelved to be studied by students of international relations.  The days of the G8 have lasped, the members are of the industrialized nations, that has exluded the developing countries like Brazil, China and India.  Granted they have been in attendence now for several years, but why continue with the G8 dinosaur.

There is a G20, which is basically the finance ministers of 20 countries that include all major economies, why disband the G8 and let the G20 stand in its place.

I must agree with the French president and the German chancellor.

As reported by Reuters:

Among the G-8 leaders, German Chancellor Angela Merkel and French President Nicolas Sarkozy have been particularly vocal that the G-8 needs to be expanded to better represent the world’s population and economies. Sarkozy told reporters on Wednesday that a possible formula would be to have the G-8 meet within the structure of a G-20, major economies taking the lead on ways out of the economic crisis, or a G-14, combining the industrialized nations and emerging economies forums.

The G8 accomplishes nothing…they meet…they talk…they issue statement and all remains the same.  I realize it is a show of diplomacy, but at least they could accomplish something other than spending money on a working vacation.

The G8 is a fossil and serves NO important purpose….time for it to be religated to history.

World Recession Continues

As the recession continues in the US, the world is not doing so well either.  The International Monetary Fund’s updated World Economic Outlook, released Wednesday, predicts world economic growth of negative 1.3 percent this year, marking “by far the deepest global recession since the Great Depression”. Not since the 1930s has the global economy undergone a collective contraction.The IMF predicts that the world economy will grow by 1.9 percent in 2010. Advanced economies will stagnate, with average GDP growth of exactly zero. These estimates may prove optimistic, especially given the Fund’s repeated revisions of the 2009 figures. In any case, IMF Chief Economist Olivier Blanchard acknowledged that there would be no rapid recovery from the current economic crisis. He noted that, historically, wherever recessions are preceded by financial crises they are more severe and longer lasting.

The IMF is not the only source for doubt.

The global financial crisis could become “a human and development calamity” for many poor countries, the World Bank said, urging donor nations to speed delivery of money they have pledged and consider giving more.

Developing countries, its main constituency, face “especially serious consequences with the crisis driving more than 50 million people into extreme poverty, particularly women and children,” the bank said Sunday.

Ministers attending the IMF-World Bank meetings said they saw signs that the world economy is stabilizing, but it will take until mid-2010 for the world to emerge from the worst recession in decades. They said stimulus packages, bank recapitalization and other actions taken by governments and central banks to deal with the crisis are beginning to show results.

World Economy Just Sucks

The United Nations says the world economy faces its worst downturn since the Great Depression.

It expects world economic output to shrink by as much as 0.4% in 2009, due to a slump among developed countries – particularly the US and in Europe.

This would mark the world economy’s first year of contraction since the 1930s, the UN said.

The UN expects developed economies to shrink by up to 1.5%, while developing nations should expand by at least 2.7%.

But because of higher population growth in developing countries, income per capita for the world as a whole is expected to fall in 2009.

And the slowing of growth in the poorest countries “suggests a significant setback in the progress made in poverty reduction in many developing countries over the past few years.”

The UN’s World Economic Situation and Prospects 2009 report gives three forecasts for growth next year – a baseline forecast of 1% growth, a pessimistic scenario of a 0.4% contraction and an optimistic scenario of 1.6% growth.

This compares with growth of 2.5% in 2008 and 3.8% in 2007.

The report said that developed economies have led the downturn, but that the global nature of trade and finance meant that economic weakness had spread rapidly to developing countries.

It warned that the international community had been complacent about the impact of the global financial crisis on poorer countries.

They are facing higher borrowing costs and lower export growth.

The UN also says that the downturn highlights key failures in the international financial system.