Avery Table Tents 5305   
Mohamed Hassan: "the causes of the revolution far beyond Tunisia Ben Ali and his party. "

Tunisians brought down the dictator Ben Ali. Today, they continue to fight against his men to head the transitional government. In this new chapter of our series "Understanding the Muslim world," Mohamed Hassan * ((photo-cons) explains the implications of the revolution of Tunisia and its root causes: how nationalism Liberal advocated by Tunisia under Bourguiba interests Western, plunging people into poverty, how a repressive state has put in place to maintain this system, why dictatorships in the Arab world are caused to fall, and how Islam became the condom imperialism




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(Gregory Lalieu Michel Collon)


In December 2010, riots broke out in Tunisia. A month later, President Ben Ali fled the country after twenty-three year reign. What are the causes of this revolution? And why is it popular movement succeeded in bringing down the dictator where other attempts have failed?

For there to be a revolution, it is necessary that people refuse to live as before and that the ruling class is no longer able to govern as before. On December 17, 2010, Mohamed Bouazizi, a young seller of fruits and vegetables, has sacrificed out of desperation after police had confiscated his goods himself, and that local authorities have to stop working. The conditions were ripe for a revolution broke out in Tunisia Bouazizi and suicide was the trigger.

Indeed, the Tunisians did not want to live as before: they were not accepting corruption, police repression, lack of freedom, unemployment, etc.. Moreover, the ruling class could no longer govern as before. Corruption under Ben Ali had taken a phenomenal amount while the majority of the population had to face insecurity. To maintain this status, police repression would be higher but it had reached its limits. The ruling elite was completely disconnected from the people for whom there was no interlocutor. Therefore, when popular revolts broke out, the ruling class had no choice but to quell the violence. But with the determination of the people, the repression reached its limit. This is one of the keys to the success of the popular revolution of Tunisia: it managed to reach all segments of society, including members of the army and police who sympathized with the demonstrators. The repressive apparatus could no longer function as before either. If a revolt occurs but is not able to combine different segments society, it can not lead a revolution.

Even after the departure of Ben Ali, the protests continue. The situation that Tunisians refuse is not the result of one man? For

signs "Ben Ali emerges" signs were followed by "CDR releases. Tunisians are attacking the president's political party because they fear that one of his men to take power. But in reality, the root causes that led to revolt Tunisians far outweigh Ben Ali and the RCD. It is not enough to turn the president for the people earns his freedom and improves living conditions.

corruption, unemployment, social inequality ... What are the effects of imperialist domination of the West over Tunisia. For Tunisia, after independence, became a project of the United States.

What do you mean by imperialism?


Imperialism is the process by which capitalist powers politically and economically dominated by foreign countries. Western multinationals plunder the resources of Africa, Latin America and Asia. They find opportunities for capital they will accumulate and exploit cheap labor market. I say that multinationals are not buying as they plunder the resources at their fair value and the local people not benefiting from these riches. And this looting would not be possible if these countries operated, there were no leaders to defend the interests of multinationals. These leaders are getting richer in the process. They constitute the so-called comprador bourgeoisie. They have no political vision for their own country does not produce wealth and do not develop a real economy. But personally enriched by trading resources their countries with multinationals. Obviously, the people are the biggest victim in all this!

When you're a nationalist anti-imperialist cons, you are looking to develop for yourself. You nationalize key sectors of your economy, rather than leaving the management to foreign companies. This will create a national economy in the country and you allow it to grow on the basis of independence. That's what I call a national democratic revolution: national independent because of the imperialist powers, democratic as against feudalism and the elements reactionaries in the country.

However, Bourguiba, Tunisia's first president, was considered a socialist. And during his reign, the state played a very important role in the economy.


Bourguiba's political party was socialist in name only. If the state played an important role, it was only for the benefit of an elite only. This is called state capitalism. In addition, Bourguiba has systematically eliminated all the progressive elements and anti-imperialist in his party. So that this party became the party of one man, completely subject to U.S. imperialism.

Habib Bourguiba , great actor in the struggle for independence, was president of Tunisia from 1957 to 1987


What Was Tunisia important for the United States?

To understand the importance of that country to the U.S. strategy, we must analyze the political context of the Arab world in years 50 and 60. In 1952, officers overthrew the monarchy of King Farouk of Egypt and proclaim a republic. With Nasser at the helm Egypt becomes the basis of Arab nationalism inspired with revolutionary ideas of socialism. As evidenced by the nationalization of the Suez Canal, Nasser's arrival in power is a blow to the West because the Egyptian president's policy is totally at odds with the hegemonic Western powers in the Near and Middle East. Worse still: the anti-imperialist ideas of Nasser are emulated in the region. In Yemen for example, where in 1962 a revolution divided the country, the South becoming a bastion of Arab revolutionary movement. The same year, the independence of Algeria sends a strong signal to Africa and the Third World, the imperialist powers put on alert. Libya also note the Qaddafi coup in 1969. The colonel took power and nationalized major sectors of the economy, to the chagrin of the West. The same year, the Islamic revolution in Iran toppled the Shah, one of the most important pillars of U.S. strategy in the Middle East.

short, at that time, an anti-imperialist movement defies strong strategic interests of the United States in the Arab world. Fortunately for Washington, all countries in the region do not follow the path of Nasser. It the case of Tunisia. In 1957, a year after the independence of Tunisia, Bourguiba was one of the first Arab leaders to send U.S. in the prestigious journal, Foreign Affairs. The title of the article? Nationalism best antidote to communism. For the United States who want to counter the influence of Nasser is a godsend! Bourguiba wrote in his article: "With the regard, Tunisia has chosen to make unequivocal its way into the free world from the West." We are in the Cold War. The Soviets argued that Nasser's influence grows in the region. And the U.S. needs pro-imperialist agents Bourguiba as not to lose strategic control of the Arab world.

Nasser announced the nationalization of the Suez Canal in 1956

Can we be both nationalist and pro-imperialist?

Bourguiba was a liberal nationalist with anti-communist ideas which led him to join the imperialist camp in the West. In fact, I feel like George Padmore Bourguiba Arabic. Padmore was a leading Pan-Caribbean origin. In 1956 he wrote a book called Pan-Africanism or Communism: The battle ahead in Africa. Like Bourguiba, he fed anti-communist ideas and even if he declared himself a nationalist, his political vision was largely subservient to the interests of imperialist powers. Nationalism served as a cover, their policy is far from being independent. Padmore had a great influence on the first president of Ghana, Kwame Nkrumah, one of the instigators of the African Union. Its pro-imperialist ideas were able to spread across the continent with the result that we see today is celebrated around the golden jubilee of independence in Africa, but many Africans know they have never become independent. President Nkrumah himself later regretted having taken the advice of Padmore.

In Tunisia too, the submission to imperialist interests has quickly been felt and it turned out that nationalism advocated by Bourguiba was a facade. In the 70s, for example, the President has passed a series of measures intended to attract foreign investors: tax exemption on company profits for ten years, exemption from all duties and taxes for twenty years, exemption from Tax Income property values, etc.. Tunisia has become a vast workshop of Western multinationals in recent repatriation of profits.

Tunisia did she not still been some good progress under Bourguiba?

Yes, there have been positive developments: education, status of women, etc.. First, because Tunisia were the progressives in his elite players, but they were quickly dismissed. Then, because Tunisia was to be dressed in his finest dress. Indeed, this country played a major role in the strategy of the United States to counter the influence of communism in the Arab world. But what had you on the other side? Progressive revolutionary movements that had toppled backward and monarchies who enjoyed popular support. You could not counteract this movement by advocating a feudal system. Saudi Arabia has done so because it could use its oil money for that. But Tunisia, unable to rely on such resources, should provide some progressive image. In the fight against communism, it was supposed to represent a successful Third World countries have chosen the path of liberal nationalism.

But behind the scenes was less flattering. As I said, Bourguiba has systematically eliminated the progressive elements that do not follow his steps. The anti-imperialists who wanted an independent Tunisia both economically and politically, those who wanted to assert their own position in the Third World and the Israeli-Palestinian conflict, all were opposed. Tunisia has in fact been used as a laboratory of the imperialist powers. And what was supposed to represent the success of liberal nationalism has become a dictatorship.

When Ben Ali Bourguiba succeeded in 1987, he continues on the same track?


Absolutely. One can even say that the submission to Western interests has grown. Ben Ali was a pure agent of U.S. imperialism. In 1980, as ambassador to Poland, he even served as a liaison between the CIA and Lech Walesa, the union leader who fought against the Soviet Union.

In 1987, when Ben Ali assumed the presidency of Tunisia, the country was deeply in debt by the capitalist crisis of 1973. Moreover, at that time, the ideas of Milton Friedman and his Chicago Boys were very popular. These ultra-liberal economists believed that the market is an entity capable of regulating themselves and that the state should certainly not interfere in the economy. The technical elite Tunisian largely from U.S. schools were highly influenced by theories of Friedman. Ben Ali then left the state capitalism in effect at the beginning of the era Bourguiba. Under the supervision of the IMF and World Bank, he began a privatization program much more massive than what his predecessor had already begun in the 70s.

What were the effects of this new economic policy?


First, privatization of the Tunisian economy has allowed Ben Ali and his wife's family, Trabelsi, personal enrichment. Corruption has reached a very high level, Tunisia has become a country totally subservient to imperialism, headed by a comprador bourgeoisie. Obviously, Ben Ali and his clan did not have many raw materials to selling out to Western multinationals. But they took advantage of the education system established under Bourguiba to develop a service economy. Indeed, the Tunisian workforce is highly educated and inexpensive at a time. It therefore attracts foreign investors.

Tourism has also developed strong as to become the mainstay of the Tunisian economy. Here we see the lack of political vision of the elite. Indeed, no country can develop its economy based on tourism if not first developed a national economic base. The tourism industry consumes a lot but reported very little to the Tunisian people. Imagine: while Western tourists consume hectoliters of water to bask in pools, Jacuzzis or golf course, the poor peasants in the south face of the drying soil.

But it's not just the farmers who have suffered from this policy. Overall, the social conditions of the Tunisian people deteriorated while the president's entourage has amassed a huge fortune. Everyone knew the regime was corrupt. So to maintain this system, the system should prevent any disputes. The repression became even more brutal penny Ben Ali simple criticism or even the desire for modernity and openness were not allowed. Such a situation could lead to popular revolt. Moreover, trying to monopolize his clan the wealth of the country, Ben Ali has also drew the ire of some of the traditional bourgeois Tunisia.


You say that political repression was very strong. Is there anyway today, opposition forces can guide the people's revolution now that Ben Ali has fallen?

Genuine opposition parties were banned under Ben Ali. However, some continued to exist underground. For example, the first Tunisian Communist Party could not live openly and organize like any political party in a democracy. But he continued to operate secretly through associations of civil society (teachers, farmers, doctors, prisoners ...). The PGWPP was able to form a social base and fired a solid experience of this period. It is exceptional in the Arab world.

I think two major challenges now await the opposition parties. First, they must come forward and make themselves known to the general public in Tunisia. Then they must organize a united front of resistance to imperialism. In fact, the imperialist powers seek to maintain the system without Ben Ali Ben Ali. We see now with the Union government National rejected the Tunisians, which is very positive. But the imperialist powers will not stop there. They will certainly seek to impose an International Electoral Commission to support candidates who defend to their best interests. It is therefore necessary to resist interference by creating a united front to build a true democracy.


Opposition parties are they able to overcome their differences to create such a front?

I know that some political parties were reluctant to associate Islamo-nationalist movement Ennahda. This movement emerged in the 80s. He advocated an anti-imperialist line and in fact, has suffered political repression. Why not combine Ennahda in front of resistance to the interference of foreign powers? Tunisia is a Muslim country. It is normal that a political force emerges with an Islamo-nationalist trend. You can not prevent that.

But each of these movements must be studied separately, with its own specificities. This was done by the communist PGWPP. They studied scientifically objective conditions that apply Tunisia. Their conclusion is that the Communists and Islamo-nationalists have been victims of political repression and that even though their programs differ, they share common ground: they want an end to dictatorship and the independence of Tunisia. The Communists have proposed an alliance with the Islamo-nationalists long ago. Of course, the PGWPP does not make Tunisia a Islamic state. Its political agenda is different from that of al-Nahda. But it is the Tunisian people who will judge these differences democratically. Elections should be a contest open to everyone. That is true democracy.

Precisely opposition parties gathered in front of 14 January to fight against the interim government of Mohamed Ghannouchi, a henchman of former President Ben Ali. A hopeful sign?

Absolutely, Tunisia is on the right track: all opposition parties banned so far have created a united front to prevent the system is maintained without Ben Ali Ben Ali. Also underline the role played by the base of the union UGTT. The head of the union authorized under Ben Ali was corrupt and working with the state police. But since the basis of the union put pressure on its leaders and members who UGTT were part of the transitional government have resigned. Although much remains to be done, democracy wins Tunisian institutions under pressure from the people.

Western powers opposed to that. They want to impose democracy in Tunisia where only low-intensity "good" candidates would be allowed to stand for election. If you look at the type of democracy that the United States enjoy, you come across Ethiopia. The U.S. government has provided $ 983 million to countries in the Horn of Africa for the year 2010. That same year, Prime Minister Meles Zenawi, in office since 16 years, was reelected with 99.5 percent of the vote! It's even better than Ben Ali! The reality is this: behind their rhetoric in support of the Tunisian people, the Western powers continue to actively support many other Ben Ali in the world.

The United States could not they support other candidates pro-imperialist, but in the eyes of Tunisians, were not associated with the Ben Ali era?

It would be difficult. There is a part of the comprador bourgeoisie which was lésinée by the corrupt system of Ben Ali. But this elite is not strong enough control the popular movement and not enough grounding in the Establishment to win.

The United States had also thought of another strategy: a few months ago, while Ben Ali was still in power, the U.S. ambassador has visited a Communist leader in prison. Officially, a simple observation visit in the framework of respect for human rights. Unofficially, the U.S. anticipated the departure of Ben Ali and wanted to test the waters. Their goal was to get the Communists against the Islamo-nationalists, divide the resistance to imperialism to weaken more. But the Communists Tunisia does not fall into the trap. They are very familiar with the strategy developed by Henry Kissinger in the 80s in the Middle East. They published a very good study on the subject and know they should not take orders from outside or adhere to ideologies manufactured by foreign powers.

Why the U.S. have they abandoned Ben Ali? Had he gone too far in personal enrichment? According to a cable Wikileaks, the U.S. ambassador was very critical of the system of quasi-mafioso Tunisian president, organized corruption are obstacles to investments by foreign companies.

This is not the problem. The United States does not care about corruption. Instead, it is a key element of the system of domination on the U.S. South. In fact, Washington was aware of the internal situation in Tunisia and knew that Ben Ali would not be able to govern. The West must now ensure that the replacement of Ben Ali will continue to defend their interests. The stakes are high. The capitalist crisis is causing serious problems in the West. Besides this, China is getting stronger and now provides more loans than the World Bank and other imperialist powers combined. She even wants to buy a significant portion of the debt of the euro area partly because it has economic interests with European countries, on the other imperialist powers to divide, the EU is historically associated with states USA.

In such a context, the Tunisian people's movement, under the auspices of a revolutionary leadership, could establish an independent government and take advantage of this situation of a multipolar world. The imperialist powers fear that countries that were traditionally under his rule become economically independent, turning also to China. Tunisia could build relationships with the Asian giant to develop its commercial ports. And it would seriously question the concept of the Mediterranean Dialogue, this expansion of NATO to the countries of the Mediterranean that is not a dialogue but a mere instrument of Western domination.

Another country that seems to fear democracy in Tunisia and in the region, Israel. Deputy Prime Minister Silvan Shalom said shortly after the fall of Ben Ali that the development of democracy in Arab countries threaten Israel's security. This country often called only democracy in the Middle East, would he be afraid of competition?

Under a democratic facade, Israel is a fascist, apartheid state. In the region, it can not ally with repressive dictatorial states, led by comprador bourgeoisie that weaken the body of the Arab nation. Currently, these Arab states are rich countries inhabited by poor people. But if a democratic government in the full sense of the term emerges, it will increase economically the Arab nation as a whole. And this economic development will lead to an alliance of Arab countries against the state racist oppressing the Palestinians. Israel fears this course.

Moreover, there is a very big gap between the official positions of Arab dictatorships and the popular sentiment about the Israeli-Palestinian conflict. Since Egyptian President Sadat visited Israel in 1977, Egypt's position is "we want peace." But it is a position imposed by force to the population. And the current Egyptian government is not content to maintain peaceful relations with Tel Aviv. It participates actively in the strangulation of Gaza, while the majority of Egyptians in solidarity with Palestinians.

It's the same alignment of Arab dictatorships on Washington politics. Tunisia, Saudi Arabia and Egypt are allies of the United States while the populations of these countries are anti-imperialists. I was in Egypt when Muntadhar al-Zaidi, a journalist in Iraq, threw his shoes on George W. Bush. The Egyptian population was celebrated as a hero. I heard of fathers wanting to marry their daughter with the reporter. Still, Egyptian President Hosni Mubarak is one of the most faithful allies of Washington.

Do you think the revolution Tunisia a domino effect could cause the downfall of other dictatorships in the Arab world?

70% of the population in Arab countries is less than thirty years and knows that unemployment, police repression and corruption. But all these young people want to live. And to live, they need change. This is the reality of each country. It is therefore not even need a domino effect, the objective conditions are ripe for further revolutions erupt.

People no longer want to live as before. But for their part, the ruling classes are they unable to govern as before?

course. And we see in Egypt today. There are police everywhere in this country. But it is impossible to control everything. A state police has its limitations and the Arab world have reached.

Furthermore, information plays a very important role today. Tunisians, Egyptians and peoples of the Third World are better informed through Al-Jazeera as part of an Internet and social networks on the other. The evolution of information technology has increased the level of education and consciousness of people. The people no longer a mass of illiterate peasants. You have a lot of very smart young people, with a certain practical sense, able to circumvent censorship and of mobilizing the Internet.

there in these countries the opposition forces can guide the popular revolutions?

Why Punishment is so important if these dictators were not in danger? Why the comprador bourgeoisie, so greedy, she would spend so much money in the repressive apparatus if she was not afraid to be reversed? If there was no opposition, all this would not be necessary.

the side of Western observers, many fear that the collapse of these regimes Arab favors the rise of Islamism. As summarized so finely Christophe Barbier, editor of L'Express, "Ben Ali is better than the bearded." These fears proved on of Islamism are they based?

Islamism became the condom of imperialism. Western powers justify their strategy of domination in the Arab-Muslim world under the guise of fighting against Islam. There are Islamists everywhere today. Soon, we shall find even traces of Al-Qaeda on Mars if it is useful to the imperialists!

In reality, the West has always needed to invent an enemy to justify its hegemonic designs and incredible military spending (financed by taxpayers). After the fall of the Soviet Union and the demise of the communist enemy is Islam and Al Qaeda who have played the roles of villains villains.

But the West has no problem with Islamism. It adapts very well to this trend in countries like Saudi Arabia. Moreover, he himself fostered the rise of Islamist movements to counter the Arab nationalism at a time. The real problem for the West is anti-imperialism. That's why he tries to discredit any popular movement in the Arab world who is opposed to its interests by affixing the label "Islamist."

Finally, it should not be very smart to think that the Arab dictatorships are bulwarks against the rise of religious fanaticism. Instead, these repressive regimes have led some of the population to be radicalized. Who could afford to say that such and such people have no right to democracy? In a truly democratic country, different political forces may emerge. But the bourgeoisie comprador ruling in the Arab dictatorships can not convince people. She can not even face to face. To defend the imperialist interests, you must prevent other political forces to emerge because they are likely to convince the people against a corrupt elite. The West has always sought to maintain dictatorships that served its interests by waving the specter of Islamism. But the Arab peoples need democracy. They claim it today and nobody can not go against these claims.

Source: www.michelcollon.info
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Lures & Revolutions

What happens in the Maghreb, Egypt is probably a prelude, predators waiting for their time: these insurgencies are for them, as once were the struggles of American countries South, a field of experimentation. Become cumbersome, the Ben Ali Mubarak and other (member of the International Socialist! As DSK, as Ségolène!) Will be replaced by Democrats on their own blessed by the IMF and technocrats dismal. As we will rely on the current economic system will not change anything in depth because it is the source of deadly disturbances of humanity as a whole.

All cases we defend not they come here? Address the profound evil does he not return to drastically change my lifestyle? Give yourself the luxury of denying that the neighbors poor, hitherto ignored, can live decently. Solidarity that is shared, like bread, like a handshake, like a poem, like ideas and wealth too. Let's start by sweeping our doorstep. Globalization? I felt like an illusion, an ideology of standardization and formatting of the masses. An insurgency is not a revolution: the first is the result of a situation had become intolerable while the second, in essence, is the long term, by mobilizing more than the civic conscience which should be central to any process and any political action. The game of global governance that is taking place is to discredit political thought (which has nothing to do with an ideological construct). Let us not forget that capitalism is the result of an ideology (with its strategies, policy makers and police), and in this respect is comparable to Stalinism which was only a state capitalism totalitarian. And this is capitalism, we do not too worried, is not it, when rampant in the Arab and African held an iron fist by dictators orders of multinational corporations, guided by foreign secret services. Dream holiday in Hammamet Marrakech or for a nominal price, which in the wings, has a price in human lives.

unbridled consumption, a synonym for huge profits, which suck the vast majority of people, today revealed its limitations and the risks it is incurring imminent future generations. Market forces, as we bombard the singers of the single thought, were only dressing a hateful ideology has continued to crush the living beauty of the values common to all cultures.

" That the Earth is pretty " said the poet Armand Robin, "No need also flowers!"


G. Hadey
          Brandon Smith: “Next Phase of Collapse Will Include the End of the Dollar as We Know It”   
Brandon Smith: “Next Phase of Collapse Will Include the End of the Dollar as We Know It”
SOURCE

The Federal Reserve Is A Saboteur – And The “Experts” Are Oblivious
I have written on the subject of the Federal Reserve’s deliberate sabotage of the U.S. economy many times in the past. In fact, I even once referred to the Fed as an “economic suicide bomber.” I still believe the label fits perfectly, and the Fed’s recent actions I think directly confirm my accusations.
Back in 2015, when I predicted that the central bankers would shift gears dramatically into a program of consistent interest rate hikes and that they would begin cutting off stimulus to the U.S. financial sector and more specifically stock markets, almost no one wanted to hear it. The crowd-think at that time was that the Fed would inevitably move to negative interest rates, and that raising rates was simply “impossible.”


Many analysts, even in the liberty movement, quickly adopted this theory without question. Why? Because of a core assumption that is simply false; the assumption that the Federal Reserve’s goal is to maintain the U.S. economy at all costs or at least maintain the illusion that the economy is stable. They assume that the U.S. economy is indispensable to the globalists and that the U.S. dollar is an unassailable tool in their arsenal. Therefore, the Fed would never deliberately undermine the American fiscal structure because without it “they lose their golden goose.”
This is, of course, foolish nonsense.
Since its initial inception from 1913-1916, the Federal Reserve has been responsible for the loss of 98% of the dollar’s buying power. Idiot analysts in the mainstream argue that this statistic is not as bad as it seems because “people have been collecting interest” on their cash while the dollar’s value has been dropping, and this somehow negates or outweighs any losses in purchasing power. These guys are so dumb they don’t even realize the underlying black hole in their own argument.
IF someone put their savings into an account or into treasury bonds and earned interest from the moment the Fed began quickly undermining dollar value way back in 1959, then yes, they MIGHT have offset the loss by collecting interest. However, this argument, insanely, forgets to take into account the many millions of people who were born long after the Fed began its devaluation program. What about the “savers” born in 1980, or 1990? They didn’t have the opportunity to collect interest to offset the losses already created by the Fed. They were born into an economy where saving is inherently more difficult because a person must work much harder to save the same amount of capital that their parents saved, not to mention purchase the same items their parents enjoyed, such as a home or a car.
Over the decades, the Fed has made it nearly impossible for households with one wage earner to support a family. Today, men and women who should be in the prime of their careers and starting families are for the first time in 130 years more likely to be living at home with their parents than any other living arrangement.
People are more likely to be living with their parents now than back during time periods in which young people actually wanted to stay close to their parents to take care of them. That is to say, most young people are stuck at home because they can’t afford to do anything else, not because they necessarily want to be there.
This is almost entirely a symptom of central bank devaluation of the currency and its purchasing potential. The degradation of the American wage earner since the Fed fiat machine began killing the greenback is clear as day.
The Fed is also responsible for almost every single major economic downturn since it was established. As I have noted in the past, Ben Bernanke openly admitted that the Fed was the root cause of the prolonged economic carnage during the Great Depression on Nov. 8, 2002, in a speech given at “A Conference to Honor Milton Friedman … On the Occasion of His 90th Birthday:”
“In short, according to Friedman and Schwartz, because of institutional changes and misguided doctrines, the banking panics of the Great Contraction were much more severe and widespread than would have normally occurred during a downturn.
Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve. I would like to say to Milton and Anna: Regarding the Great Depression. You’re right, we did it. We’re very sorry. But thanks to you, we won’t do it again.”
Bernanke is referring in part to the Fed’s program of raising interest rates into an economic downturn, exacerbating the situation in the early 1930’s and making the system highly unstable. He lies and says the Fed “won’t do it again;” they are doing it RIGHT NOW.
The Fed was the core instigator behind the credit and derivatives bubble that led to the crash in 2008, a crash that has caused depression-like conditions in America that we are still to this day dealing with. Through artificially low interest rates and in partnership with sectors of government, poor lending standards were highly incentivised and a massive debt trap was created. Former Fed chairman Alan Greenspan publicly admitted in an interview that the central bank KNEW an irrational bubble had formed, but claims they assumed the negative factors would “wash out.”
Yet again, a Fed chairman admits that they either knew about or caused a major financial crisis. So we are left two possible conclusions — they were too stupid to speak up and intervene, or, they wanted these disasters to occur.
Today, we are faced with two more brewing bubble catastrophes engineered by the Fed: The stock market bubble and the dollar/treasury bond bubble.
The stock market bubble is rather obvious and openly admitted at this point. As the former head of the Federal Reserve Dallas branch, Richard Fisher, admitted in an interview with CNBC, the U.S. central bank in particular has made its business the manipulation of the stock market to the upside since 2009:
“What the Fed did — and I was part of that group — is we front-loaded a tremendous market rally, starting in 2009.
It’s sort of what I call the “reverse Whimpy factor” — give me two hamburgers today for one tomorrow.”
Fisher went on to hint at his very reserved view of the impending danger:
“I was warning my colleagues, Don’t go wobbly if we have a 10 to 20 percent correction at some point… Everybody you talk to… has been warning that these markets are heavily priced.” [In reference to interest rate hikes]
The Fed “front-loaded” the incredible bull market rally through various methods, but one of the key tools was the use of near-zero interest rate overnight loans from the central bank, which corporations around the world have been exploiting since the 2008 crash to fund stock buybacks and pump up the value of stock markets. As noted by Edward Swanson, author of a study from Texas A&M on stock buybacks used to offset poor fundamentals:
“We can’t say for sure what would have happened without the repurchase, but it really looks like the stock would have kept going down because of the decline in fundamentals… these repurchases seem to hold up the stock price.”
In the initial TARP audit, an audit that was limited and never again duplicated, it was revealed that corporations had absorbed trillions in overnight loans from the Fed. It was at this time that stock buybacks became the go-to method to artificially prop up equities values.
The problem is, just like they did at the start of the Great Depression, the central bank is once again raising interest rates into a declining economy. This means that all those no-cost loans used by corporations to buy back their own stocks are now going to have a price tag attached. An interest rate of 1% might not seem like much to someone who borrows $1000, but what about for someone who borrows $1 Trillion? Yes, borrowing at ANY interest rate becomes impossible when you need that much capital to prop up your stock. The loans have to be free, otherwise, there will be no loans.
Thus, we have to ask ourselves another question; is the Fed really ignorant enough to NOT know that raising rates will kill stock markets? They openly admit that they knew what they were doing when they inflated stock markets, so it seems to me that they would know how to deflate stock markets. Therefore, if they deliberately engineered the market rally with low interest rates, it follows that they are deliberately engineering a crash in markets using higher interest rates.
Mainstream economists and investment “experts” appear rather bewildered by the Federal Reserve’s exuberance on rate hikes. Many assumed that Janet Yellen would hint at a pullback from the hike schedule due to the considerable level of negative data on our fiscal structure released over the past six months. Yellen has done the opposite. In fact, Fed officials are now stating that equities and other assets appear to be “overvalued” and that markets have become complacent. This is a major reversal from the central bank’s attitude just two years ago. The fundamental data has always been negative ever since the credit crisis began. So what has really changed?
Well, Donald Trump, the sacrificial scapegoat, is now in the White House, and, central bank stimulus has a shelf life.  They can’t prop up equities for much longer even if they wanted to. The fundamentals will always catch up with the fiat illusion. No nation in history has ever been able to print its way to prosperity or even recovery. The time is now for the Fed to pull the plug and lay blame in the lap of their mortal enemy – conservatives and sovereignty champions. They will ignore all financial reality and continue to hike. This is a guarantee.
In the Liberty Movement the major misconception is that the Fed is attempting to “catch up” to the next crash by raising interest rates so that they will be ready to stimulate again. There is no catching up to this situation. The Fed has no interest in saving stock markets or the economy. Again, the fed has raised rates before into fiscal decline (during the Great Depression), and the result was a prolonged crisis. They know exactly what they are doing.
What does the Fed gain from this sabotage? Total centralization. For example, before the Great Depression there used to be thousands of smaller private and localized banks in America. After the Great Depression most of those banks were either destroyed or absorbed by elite banking conglomerates. Banking in the U.S. immediately became a fully centralized monopoly by the majors. In a decade, they were able to remove all local competition and redundancy, making communities utterly beholden to their credit system.
The 2008 crash allowed the banking elites to introduce vast stimulus measures requiring unaccountable fiat money creation. Rather than saving America from crisis, they have expanded the crisis to the point that it will soon threaten the world reserve status of our currency. The Fed in particular has set the U.S. up not just for a financial depression, but for a full spectrum calamity which will include a considerable devaluation (yet again) of our currency’s value and resulting in extreme price inflation in necessities.
The next phase of this collapse will include the end of the dollar as we know it, making way for a new global currency system that uses the IMF’s SDR basket as a foundation. This plan is openly admitted in the elitist run magazine ‘The Economist’ in an article entitled “Get Ready For A Global Currency By 2018.
It is important to understand what the Fed actually is — the Fed is a weapon. It is a weapon used by globalists to destroy the American system at a given point in time in order to clear the way for a new single world economy controlled by a single managerial entity (most likely the IMF or BIS). This is the Fed’s purpose. The central bank is not here to save the U.S. from harm, it is here to make sure the U.S. falls in a particular manner — a controlled demolition of our fiscal structure.


The US Is Becoming A 3rd World Nation As The Economy Breaks Down: Paul Craig Roberts

 



          By 2100, Refugees Would Be the Most Populous Country on Earth   
Poverty and deadly wars are the major drivers of displacement.

The UN Refugee Agency has announced the new figures for the world’s displaced: 65.9 million. That means that 65.9 million human beings live as refugees, asylum seekers or as internally displaced people. If the refugees formed a country, it would be the 21st largest state in the world, just after Thailand (68.2 million) and just ahead of the United Kingdom (65.5 million). But unlike these other states, refugees have few political rights and no real representation in the institutions of the world.

The head of the UN Refugee Agency, Filippo Grandi, recently said that most of the displacement comes as a result of war. "The world seems to have become unable to make peace," Grandi said. "So you see old conflicts that continue to linger, and new conflicts erupting, and both produce displacement. Forced displacement is a symbol of wars that never end."

Few continents are immune from the harsh reality of war. But the epicenter of war and displacement is along the axis of the Western-driven global war on terror and resource wars. The line of displacement runs from Afghanistan to South Sudan with Syria in between. Eyes are on Syria, where the war remains hot and the tensions over escalation intensify daily. But there is as deadly a civil war in South Sudan, driven in large part by a ferocious desire to control the country’s oil. Last year, 340,000 people fled South Sudan for refugee camps in neighboring Uganda. This is a larger displacement than from Syria.

Poverty is a major driver of displacement. It is what moves hundreds of thousands of people to try and cross the Sahara Desert and then the Mediterranean Sea for European pastures. But most who try this journey meet a deadly fate. Both the Sahara and the Mediterranean are dangerous. This week, the UN’s International Organisation for Migration (IOM) in Niger rescued 600 migrants from the Sahara, although 52 did not survive.

A 22-year-old woman from Nigeria was among those rescued. She was on a pick-up truck with 50 people. They left Agadez for Libya. ‘We were in the desert for ten days,’ she says. "After five days, the driver abandoned us. He left us with all of our belongings, saying he was going to pick us up in a couple of hours. But he never did." Forty-four of the migrants died. The six who remained struggled to safety. ‘We had to drink our own pee to survive,’ she said.

Getting to Libya is hard enough. But being in Libya is perilous. Violence against vulnerable migrants inside Libya continues to occur. The IOM reports the presence in Libya of ‘slave markets.’ Migrants who make it across the Sahara into Libya have told investigators that they find themselves in these slave markets where they are bought to be taken to private prisons and put to work or else sold back to their families if they can raise the high ransom payments. UNICEF reports incidents of rape and violence against women and children in these private prisons. One 15-year-old boy said of his time in a private prison, "Here they treat us like chickens. They beat us, they do not give us good water and good food. They harass us. So many people are dying here, dying from disease, freezing to death."

Danger lurks on the sea as well. This year already IOM reports least 2,108 deaths in the sea between Libya and Italy. This is the fourth year in a row that IOM has counted over 2,000 deaths by mid-year. Over the past five years, this averages out to about 10 deaths a day. Libya, broken by NATO’s war in 2011, remains a gateway for the vulnerable from various parts of Africa, countries damaged by IMF policies and by warfare. There is no expectation that the numbers of those on the march will decrease.

In a recent paper in The Lancet (June 2017), Paul Spiegel, formerly of the UN Refugee Agency suggests that the "humanitarian system was not designed to address the types of conflicts that are happening at present." With over 65 million people displaced, the various institutions of the UN and of the NGO world are simply not capable of managing the crisis.

"It is not simply overstretched," Spiegel wrote of the humanitarian system, "it is no longer fit for purpose."

These are shattering words. One problem Spiegel identifies is the assumption that refugee flows are temporary, since wars will end at some point. What happens when wars and occupations are permanent? People either have to live for generations in refugee camps or they will seek, through dangerous passages, flight to the West. He gives the example of Iran, which absorbed over a million Afghan refugees without using the camp strategy. They simply allowed the Afghans into Iranian society and absorbed them by putting money into their various social schemes (such as education and health). Spiegel also points out that refugees must be part of the designing the process for humanitarian aid. These are good suggestions, but they are not going to be possible with the limited funds available for refugees and with the crisis level of activity that detains the humanitarian agencies.

Spiegel does not deal with one of the great problems for humanitarianism: the persistence of war and the theory that more war—or the current euphemism, security—is the answer to humanitarian crises. This January, over 1,000 people tried to scale the large barrier that divides Morocco from the Spanish enclave of Ceuta. Looking at that barrier, one is reminded of the idea that walls will somehow prevent migration, a view driven by President Donald Trump. Violence met the migrants, a mirror of the violence that was visited among migrants along the spinal cord of Eastern Europe last year. Walls, police forces and military interventions are all seductive to an imagination that forgets why people migrate and that they are human beings on the run with few other options. There is a view that security barriers and security forces will raise the price of migrant and deter future migrants. This is a silly illusion. Migration is dangerous already. That has not stopped anyone. More humane thinking is necessary.

It is important therefore that the UN Deputy Secretary-General Amina Mohammed told a meeting on the Sahel on June 28 that the world leaders need to "avoid a disproportionate emphasis on security" when dealing with the multiple crises in the Sahara region and north of it. "No purely military solution" can work against transnational organized crime, violent extremism and terrorism, nor against poverty and hopelessness. Underlying causes are not being addressed, and indeed the surface reactions—to bomb more—only create more problems, not less.

In the July issue of Land Use Policy, professors Charles Geisler and Ben Currens estimate that by 2100 there will be 2 billion refugees as a result of climate change. These numbers are staggering. They are an inevitable future. By then, refugees will be the largest country on earth—nomads, seeking shelter from destruction of climate and capitalism, from rising seas and wars of greed.

 

Related Stories


          Emerging Markets: What has Changed   
(from my colleague Dr. Win Thin)

  • Chinese President Xi visited Hong Kong for the first time.
  • The US has proposed $1.3 bln of arms sales to Taiwan.
  • The Egyptian government raised fuel and cooking gas prices. significantly as part of the IMF program.
  • South Africa’s parliament has scheduled the no confidence vote on President Zuma.
  • Brazil’s central bank lowered its inflation target.
  • Brazil after President Temer was charged with corruption.

In the EM equity space as measured by MSCI, Brazil (+2.9%), Russia (+1.5%), and Turkey (+0.9%) have outperformed this week, while Czech Republic (-3.0%), Hungary (-1.2%), and Chile (-0.9%) have underperformed.  To put this in better context, MSCI EM fell -0.1% this week while MSCI DM fell -0.3%.

In the EM local currency bond space, Brazil (10-year yield -13 bp), Colombia (-6 bp), and China (-5 bp) have outperformed this week, while South Africa (10-year yield +27 bp), Philippines (+17 bp), and Hungary (+17 bp) have underperformed.  To put this in better context, the 10-year UST yield rose 14 bp to 2.28%. 

In the EM FX space, ILS (+1.3% vs. USD), BRL (+1.0% vs. USD), and SGD (up 0.8% vs. USD) have outperformed this week, while ARS (-2.5% vs. USD), ZAR (-1.4% vs. USD), and COP (-1.0% vs. USD) have underperformed. 

Chinese President Xi visited Hong Kong for the first time.  The visit commemorates the 20th anniversary of the Hong Kong handover. Xi stressed that the “one country, two systems” framework remains successful.  USD/HKD traded at its highest level since January 2016.

The US has proposed $1.3 bln of arms sales to Taiwan.  The package would reportedly contain early warning radar, anti-radar missiles, and naval torpedoes.  It was approved by the Defense Department and will move forward unless Congress blocks it within 30 days.  Of course, Chinese officials objected.

The Egyptian government raised fuel and cooking gas prices significantly as part of the IMF program.  Prime Minister Ismail said inflation (29.7% y/y in May) was likely to accelerate 4-5 percentage points as a result of the price hikes.  After a 300 bp hike in conjunction with the EGP float, the central bank remained on hold until it hiked 200 bp more to 16.75% in May.  

South Africa’s parliament has scheduled the no confidence vote on President Zuma.  After several delays, the vote will be held on August 3.  Parliament added that it has not yet decided on whether the vote will be done via secret ballot.

Brazil’s central bank lowered its inflation target.  The central bank will now target inflation at 4.25% in 2019 and 4.0% percent in 2020, down from the 4.5% target that has been in place since 2005.  The tolerance band was kept at +/- 1.5 percentage points, which came into effect this year.  
 
Politics is taking center stage again in Brazil after President Temer was charged with corruption.  This is connected to the recent secret recordings of an alleged conversation between Temer and Joesley Batista.  The charges now need to be approved by two thirds of the lower house in order to proceed.  Even if he survives the vote, the reform agenda will be delayed, if not derailed.   








Disclaimer




          Two Policy Updates   

The IMF has been reluctant to participate in the aid package to Greece that runs out the middle of next year.  It does not believe that Greek debt is sustainable.  Nevertheless, it did recently agree to provide a precautionary line of credit at the end of the program.   

The IMF decision required the approval of the board, and we thought there was a reasonable chance the US would block it.   That would have been significant, as the German and Dutch parliaments require the IMF participation, but there is no compelling reason for the IMF to participate.   The sustainability of Greece's debt is such an open question that the ECB, which accepts Greek bonds as collateral (for weekly operations) will not include Greek bonds in its asset purchase program.  Moreover, Europe can take care of its ownproblems.  Isn't that what the European Stabilization Mechanism is meant to do?  

The Trump Administration has shown little sympathy for Europe.  The US President has been particularly critical of Germany.  The new sanctions that the US Senate has approved and are now before the House of Representatives would make it more difficult to complete the Nord Stream 2 pipeline that is supposed to bring Russian gas to western Europe bypassing Ukraine.  The US commercial interest is clear too.  It wants to export more natural gas to Europe.  The US has been critical that not all European members of NATO are spending 2% of GDP on defense.  

Nevertheless, US Treasury Secretary Mnuchin appears to have approved the IMF's precautionary line of credit to Greece.  Mnuchin praised the IMF for helping stabilize the situation in Greece by working with Europe.  Mnuchin said that without the IMF's help, Greece could have once again roiled the markets.   

At the same time, the US Treasury Secretary played down the significance.  He noted that the IMF's commitment was quite small and would likely not even be used.  Mnuchin seemed to suggest it was mostly for appearances, and that it would not cost US taxpayers a penny.    He expressed support for the IMF but noted that the US was reviewing all of its contributions.  

On another front, findings of the investigation into US steel imports on national security grounds are still expectedin the coming days.  Commerce Secretary Ross had indicated the results would be ready by the end of the month.  It appears that the investigation is over and the debate over the policy response is in high gear. 

The President reportedly wants to impose tariffs and use them as the model for action on aluminum and other industries (reportedly including semiconductors, paper, and household appliances).  Reports suggest that most cabinet officials are opposed to the 20% tariff Trump is pushing.   One compromise would be a combination setting a quota on steel imports and a tariff on imports above the quota.   

US steel imports have fallen for the past two years. Setting a quota at the 2016 levels would guard against backtracking.    The prospects of a 20% tariff, however, appears to be underpinning the share prices of some of the largest US producers.  On the other hand, as consumers and producers wait for a decision, some reports suggest that it is dampening activity.  





Disclaimer




          HENRY BLODGET: Seeing more skepticism around Trumponomics   

The IMF recently cut its US GDP growth forecasts to 1.8% longer term and to 2.1% for this year and next. This is far from what Trump promised during his campaign to more than double the US growth rate to 4%, a vow that has since been downgraded to 3% by his economic team. 

Join the conversation about this story »


          China’s capital flight and US monetary policy   

China’s capital flight and US monetary policy

Yin-Wong Cheung, Sven Steinkamp, Frank Westermann 27 January 2016

In a largely closed capital market like China, illicit capital flows are inherently difficult to measure as no official data is recorded and the true volume is unobservable. However, standard proxies in the literature suggest that it is economically sizable, amounting to up to 2% of GDP in recent years. Figure 1 displays three common measures of capital flight. Although these proxies appear to follow different dynamics, they have in common that they are large and on the same order of magnitude when compared to official flows.

Figure 1. Capital flight and official flows

Data sources: National Bureau of Statistics of China, China State Administration of Foreign Exchange, Directions of Trade Statistics (IMF), International Financial Statistics (IMF), own calculations.

Measures of capital flight

The World Bank residual measure of capital flight is based on the balance of payments statistics. It compares the sources to the uses of funds – that is, it takes net foreign investment and the change in foreign debt and deducts from it the current account balance as well as the change in reserves. The remainder is a series that has widely been used as a proxy of capital flight in the literature, an unexplained component in the balance of payments.

The trade mis-invoicing measure is based on the fact that different statistical agencies record the same export/import activities, but often report different numbers. For instance, an export out of China worth $1,000 may enter the US statistics with a value of $1,000, but enter the Chinese statistics with a value of only $500. When abstracting from transportation costs this ‘under-invoicing’ of exports may be a sign of capital flight, as the remaining $500 is placed in a US bank account rather than being sent to China.

A new pattern

An interesting new pattern is the decline of total illicit flows in recent years. In particular, capital flight as measured by trade mis-invoicing has declined since the beginning of the Crisis in 2007/8. In a new paper, we explain this new finding and interpret the results in the context of China’s trend towards a gradual liberalisation of its capital account (Cheung et al. 2016).

Earlier empirical studies have shown that illicit flows, just like official flows, respond to interest differentials between countries. As capital controls exist, covered interest differentials can occur and attract portfolio rebalancing by investors on both sides. The covered interest differential has been documented to be a relevant empirical factor explaining China’s capital flight. In our extensive empirical analysis, we show that this empirical link has remarkably diminished in recent years. Using an interaction dummy variable, we show that the post-2007 response to the covered interest differential has been significantly smaller – and is hardly different from zero.

The impact of US monetary policy and other factors

A new factor that started to play a role in the post-2007 period is the relative money supply between China and the US. While China’s money supply has been rapidly increasing for many years, the US has been following an expansionary monetary policy only since the onset of the Global Crisis. Empirically, we find that this change in the relative monetary stance of the two countries has had an impact on investors’ decisions to reallocate their portfolio between the two countries. The US expansion has significantly reduced capital flight out of China, in both the trade mis-invoicing as well as a combined measure of capital flight.

This empirical result helps to explain the reduced impact of covered interest differentials. The fit of the regression, measured for instance by the adjusted R2, improves when relative money supply and a dummy variable for the post-2007 period are added to the regression. This finding is also robust when controlling for other factors in a multivariate regression setup, including relative growth rates, exchange rate regimes dummy variables, and so on.

Another new factor that becomes increasingly important is China’s gradual process of capital account liberalisation. Using the new index of capital controls by Chen and Qian (2015), we control for this process. We find that it also starts being significant in the post-2007 period. Investors appear to appreciate China’s new policies by investing their financial resources domestically. Nevertheless, we also find that the ex post realised exchange rate volatility is a negative factor for capital flight (i.e. an increase in intra-day volatility of the renminbi has a significant positive impact on capital flight out of China).

A caveat: Transportation cost and insurance

In the absence of official data, all measures of capital flight are proxies and must be interpreted with caution in general. This is particularly the case for the trade mis-invoicing measure, as exports are commonly reported without transportation cost and insurance while data on imports include these items. The IMF and other researchers typically assume a constant 10% of the net trade value for transportation and insurance when computing trade mis-invoicing proxies.

But certainly trade costs can vary both across countries and over time. The statistical significance of tariff revenues in our regressions suggests that this is indeed a potential shortcoming of the analysis. To address this issue, we construct a modified version of the trade mis-invoicing measure that uses country-specific and time-varying trade cost estimates that were computed by the CEPII institute from a standard trade-gravity equation. The main results in the empirical analysis are unaffected by this change.

Economic and policy implications

Our empirical results highlight the challenges of managing China’s capital flight. First, different measures of capital flight seem to have different empirical determinants. Second, these determinants have been changing over time. From the Chinese perspective, it is thus important to take a disaggregated analysis into account when designing further steps of financial opening.

Our regression analysis extends only to the end of 2014 and does not include the events of the past year. Our findings imply, however, that the increased volatility in the summer of 2015 and in particular the recent raise in US interest rates, which were associated with expectations of a more general reversal of US monetary policy, may be the cause of a resurgence in capital flight. This reversal has already been visible in the World Bank residual measure, as well as the combined measure, in the first three quarters of 2015.

References

Cheung, Y-W, S Steinkamp and F Westermann (2016) “China's capital flight: Pre- and post-crisis experiences”, Journal of International Money and Finance, doi:10.1016/j.jimonfin.2015.12.009.

Chen, J and X Qian (2015) “Measuring the ongoing changes in China’s capital flow management: A de jure and a hybrid index data set”, HKIMR Working Paper No.11/2015.

Topics:  Global economy International trade Monetary policy

Tags:  capital flight, monetary policy, globalisation, international trade, Fed, expansion, capital account liberalisation, money supply, illicit capital flows, trade


          Evidence that low real rates will persist   

Will interest rates be permanently lower?

John Williams 26 November 2015

Following the Global Crisis, central banks around the world brought their policy rates close to zero, as shown in Figures 1 and 2. And now a few – including the ECB, the Swedish Riksbank, and the Swiss National Bank – have crossed the zero-rate threshold and instituted negative interest rates. A period of nearly seven years of extremely low interest rates has spurred a debate over whether interest rates will return to more normal levels. Will they rebound once the effects of the global financial crisis are finally behind us? Or are low rates a permanent feature of the economic landscape? The resolution to this debate has important implications for the economy and monetary policy (Summers 2014).

Figure 1. Near-zero interest rates following the Global Financial Crisis

Source: OECD, Federal Reserve Board.

Figure 2. Negative short-term interest rates become more common

Source: OECD.

Economists have a laundry list of developments that, in theory, could cause the trend in real (inflation-adjusted) interest rates to change over time. These include persistent shifts in the rate of productivity growth, demographics, risk aversion, fiscal policy, and international factors (Congressional Budget Office 2015, IMF 2014, Council of Economic Advisers 2015, Hamilton et al 2015). However, it has proven more challenging to gauge their quantitative impact on trend interest rates.

Unfortunately, standard statistical techniques are poorly suited to distinguish whether a permanent shift in interest rates will emerge from the current situation – an extended period of low rates instituted in response to an unusually deep recession and sluggish recovery. As discussed in Laubach and Williams (2015), the fact that rates have been very low for close to seven years implies that standard statistical methods indicate that the fall in real rates is entirely due to a downward shift in trend. In particular, these methods indicate that the current trend short-term rate in the US is about –1.5. A similar conclusion is drawn for global interest rates (Hamilton et al 2015).

One way around this problem is to use a macroeconomic model that explicitly takes into account the combined behaviours of inflation, output, and interest rates in estimating the trend in real interest rates. In the Laubach-Williams (LW) model, the trend, or ‘natural,’ real interest rate is implicitly defined as that which occurs when the economy is operating at its full potential and there are no inflationary pressures in either direction. This model assumes that the trend real interest rate depends on the estimated trend growth rate of real GDP and other unspecified influences.

The model is estimated using the Kalman filter. The Kalman filter operates on the principle that one should partially adjust one’s estimate of the unobserved variables –the trend natural rate of interest, the level of potential output, and its trend growth rate – based on the discrepancies between the model’s predictions for real GDP and inflation, and the actual data.  In particular, if real GDP is lower than the model predicts, the estimate of the natural rate of interest is reduced by a small fraction of the forecast error. The output gap estimate, in turn, is based on a Phillips curve relationship between inflation, the output gap, and other variables. If, for example, inflation turns out lower than predicted, the level of potential output is revised up (that is, for a given level of real GDP, the output gap is revised down) by a small fraction, as is the estimate of the trend growth rate of potential output.

The LW estimates of the natural rate of interest display a moderate secular decline over the two decades preceding the Great Recession and a second, more substantial decline during the Great Recession (Williams 2015). Figure 3 shows the estimates of the natural rate of interest from 1980 to 2015.  The estimate of the natural rate was about 3.5% for 1990, gradually declining to about 2% in 2007, on the cusp of the Great Recession. In the recession years of 2008 and 2009, the estimated natural rate plummets to about zero, where it has remained ever since. This is an unprecedented decline and historical low for the natural rate.

Figure 3. Laubach-Williams estimates of trend short-term real interest

Note: Grey bands denote NBER recessions.

What accounts for the decline in natural rates? According to the LW model, a falling trend rate of potential output growth accounts for about half of the decline.  The final two rows of Table 1 show the contributions from changes in trend growth and the catch-all ‘other factors’ to the decline in the estimated natural rate for the periods 1990–2007 and 2007–2015.  Figure 4 shows the LW model estimates of the trend growth rate of potential output over 1980–2015. Estimated trend potential output growth was about 3.5% in 1990, declining to 3% in 2007, then falling sharply to about 2%. Note that the model does not attribute these movements in trend potential output growth to specific sources; rather they are treated as exogenous shifts.

Table 1. Alternative measures of trend real short-term interest rates

Figure 4. Laubach-Williams estimates of the trend growth rate of GDP

Note: Grey bands denote NBER recessions.

There is robust evidence of a persistent decline in the trend real interest rates using alternative approaches to estimate trend real interest rates. Laubach and Williams (2015) explore alternative versions of the LW model and in each case the current estimate of trend real rates is very low. In addition, a number of other studies have examined whether trend real interest rates are permanently lower. Although individual estimates differ, it is striking that a wide variety of approaches point to historically low levels of future real interest rates (Hamilton et al 2015, Johannsen and Mertens 2015, Kiley 2015, Lubik and Matthes 2015).

Economic forecasters and financial market participants appear to have embraced this perspective, as seen in economists’ surveys and yields on Treasury Inflation-Protected Securities (TIPS). The first row of Table 1 reports natural rate estimates implied by the long-run forecasts from the Blue Chip survey of forecasters. The second row reports real interest rates five to ten years in the future based on TIPS yields (note that TIPS did not exist in 1990). The third row reports the LW estimates. The pattern of declining trend interest rates is consistent across the three measures, although the movements in the LW estimates are noticeably larger than the other two.

What are the implications of the sizeable decline in the trend real rate of interest? First, if sustained, it implies that longer-term interest rates will also be correspondingly lower on average. Second, a lower average real interest rate implies that episodes of monetary policy being constrained at the zero lower bound are likely to be more frequent and longer (Reifschneider and Williams 2000). Third, it is a powerful reminder that one should not treat the natural rate of interest as fixed, as is often done in discussions of monetary policy rules such as the Taylor rule. Finally, estimates of trend or natural rates are subject to a great deal of uncertainty (Orphanides and Williams 2002, Laubach and Williams 2003). The various measures of trend interest rates differ by as much as 1.5 percentage points, an unusually large deviation in estimates compared to the period before the Great Recession.

So, will interest rates be permanently lower? While an unequivocal answer is not possible with the information at hand, the evidence suggests a significant decline in the trend in real interest rates. And there is little, if any, sign of a return to a more normal trend.  Taken together, this evidence suggests that it is likely that the trend in real short-term interest rates is lower than it was in previous decades, with the possibility that it may even have fallen below 1%.

Author’s note: The views presented in this article are the author’s alone, and do not necessarily reflect those of other members of the Federal Reserve System.

References

Congressional Budget Office (2015) The 2015 Long-Term Budget Outlook, June 16.

Council of Economic Advisers (2015) “Long-term interest rates: A survey”, July.

Hamilton, J D, E S Harris, J Hatzius and K D West (2015) “The equilibrium real funds rate: Past, present, and future”, Hutchins Center on Fiscal & Monetary Policy at Brookings, Working Paper 16, October 30.

International Monetary Fund (2014) World Economic Outlook: April 2014.

Johannsen, B K and E Mertens (2015) “The shadow rate of interest, macroeconomic trends, and time-varying uncertainty”, Unpublished manuscript.

Kiley, M T (2015) “What can the data tell us about the equilibrium real interest rate?” Finance and Economics Discussion Series 2015-077, Washington: Board of Governors of the Federal Reserve System, August.

Laubach, T and J C Williams (2003) “Measuring the natural rate of interest”, Review of Economics and Statistics, 85(4): 1,063–1,070. Updated estimates here.

Laubach, T and J C Williams (2015) “Measuring the natural rate of interest redux”, Federal Reserve Bank of San Francisco, Working Paper 2015-16, October.

Lubik, T A and C Matthes (2015) “Calculating the natural rate of interest: A comparison of two alternative approaches”, Federal Reserve Bank of Richmond, Economic Brief 15-10, October.

Orphanides, A and J C Williams (2002) “Robust monetary policy rules with unknown natural rates”, Brookings Papers on Economic Activity, 2002(2): 63–145.

Reifschneider, D and J C Williams (2000) “Three lessons for monetary policy in a low-inflation era”, Journal of Money, Credit, and Banking, 32(4/ 2): 936–966.

Summers, L H (2014) “US economic prospects: Secular stagnation, hysteresis, and the zero lower bound”, Business Economics, 49(2): 65–73.

Williams, J C (2003) “The natural rate of interest”, FRBSF Economic Letter, 2003-32, October 31.

Williams, J C (2015) “The decline in the natural rate of interest”, Business Economics, 50(2): 57–60.

Topics:  Global crisis Macroeconomic policy

Tags:  Fed, interest rates, zero lower bound, central bank, Central Banks, global crisis


          Estimating the equilibrium real interest rate   

The equilibrium real funds rate: Past, present and future

James Hamilton, Ethan Harris, Jan Hatzius, Kenneth West 15 November 2015

Are low real interest rates in the US here to stay? Or will the long-delayed,­ but presumably upcoming round of nominal rate hikes lead to real interest rates comparable to those that prevailed prior to the Great Recession?

There seems to be a consensus that we are heading towards a new world where the equilibrium – or long-run – value of the safe real interest rate will be lower than was conventionally thought to be normal. The Federal Open Market’s Summary of Economic Projections provides a baseline for conventional values. In December 2012, across the members of the Federal Open Market’s Summary, the median ‘longer-run’ forecast for the nominal Federal funds rate was 4%, for inflation it was 2% The implied safe real rate is thus 2%.

By contrast, Summers (2013) says that we may need to “think about how we manage an economy in which the zero nominal interest rate is... chronic”. Financial markets agree that typical rates have fallen. As of this writing, Federal funds futures over the next three years peak at about 1.5%. And in September 2015, in the Fed’s most recent Summary of Economic Projections, the median longer-run forecast for the Federal funds rate fell slightly to 3.5%. With an inflation forecast of 2%, all three sources quoted suggest a steady state real rate that is spectacular, either notably (Fed funds futures) or modestly (Summary of Economic Projections) below the 2% value that once was conventional wisdom.

Using reduced form evidence, we argue that it would be foolish to attempt to pin down a precise value for the steady state real rate. This rate is highly uncertain.  It is also highly variable.  Presumed constancy at 2% or any other value was a fiction even prior to the Great Recession. In addition, the steady state real rate is influenced by many variables.

In our view, a plausible range for the steady state real rate is wide, from a little above zero to a little below 2%.1

Determinants of the steady state real rate

An influential literature has zeroed in on growth in potential output or productivity as a prime determinant of the equilibrium rate.2 Unfortunately, the link does not seem to be present in the data, at least not in a clear or even moderately supportive way. Using rolling averages as a measure of steady state values, we find that the correlation between steady state output growth and steady state real rate is numerically small, with a sign that is sensitive to the exact sample used. This applies to averages over business cycles in the US going back to 1869 and to cross-data as well.

Here is one illustration: for the most recent seven business cycles in the US, Figure 1 plots peak to peak values of average GDP growth and of the average ex ante real rate of interest.3 To understand the figure, consider the dot corresponding to the peak in 1980:1. In the 25 quarters between the previous peak in 1973:4 and the 1980:1 peak, GDP growth averaged 2.8% and the real interest rate averaged 0.7%. Other dots are interpreted similarly.

Figure 1. Peak-to-peak average real GDP growth versus average r, quarterly data, 1969:4-2007:4

It is manifest that the link between steady state output growth and the steady state real rate is noisy. Clearly peak-to-peak GDP growth of approximately 3% can be associated with a wide range of peak-to-peak average values of the ex ante real rate – 0.7 % (1980:1), 2.9 % (2001:1) and 5.0% (1990:3). Clearly the correlation is negative (at -0.4, it so happens), rather than positive as suggested by theory. Just as clearly, dropping the 1981:3 peak would turn the correlation positive (+0.3).

We do not doubt that lower safe real rates are associated with higher spending and thus higher output, and vice versa for higher safe real rates. But that association is mediated by a host of factors, so much so that a simple bivariate relationship seems to be more noise than signal over periods as long as a business cycle. For example, the high (4.9%) average value for the real rate in the 1981:3-1990:1 cycle can be attributed in part to the overhang of high inflation from the 1970s. Investors demanded high insurance against inflation taking off again. Over time, that concern about a resurgence of inflation abated, contributing to the fall in the average value of the real rate to 2.9% in the 1990:1-2001:1 cycle. During these and other episodes, trends in inflation, time varying volatility, financial frictions, incomplete markets, heterogeneous agents, bubbles and other factors contributed substantially to the value of the steady state real rate.

The post-war average value of the ex ante real rate is 1.95%. As well, in episodes in which the rate was low, it stayed low temporarily. For example, in the cycle that ended in 2007:4, the ex ante real rate was at or below 0.3% for nearly four years (2001:4-2005:3), and below zero for over two years (2002:4-2005:1). It subsequently peaked at 3.1% in 2006:4. Hence there is evidence that mean reversion has acted as a powerful force. We are doubtful that secular stagnation looms as a force to overrule mean reversion. The possibility of such mean reversion accounts for the upper end of our 0-2% range for a possible value for the steady state rate.

Long-run tendencies of the real rate

The lower end of our 0-2% range results from a dramatically different tack. First, we look to long-term annual data. Second, we model the real rate as non-stationary. Third, we compute the steady state as an explicit time series forecast. We do so in a bivariate error correction model in which the US ex ante rate is co-integrated with a measure of the long-run, or steady state, world rate. In a given year, the world steady state rate is the median, across the 17 countries, of country-specific steady state rates. Country specific steady state rates are computed from rolling 30-year samples.

Figure 2 plots the US rate and the long-run world rate.  One can see that the annual ex ante real rate is highly variable. In the last century, this rate has shown long secular swings, going down roughly from the end for World War I to the late 1940s, up from the late 1940s to the late 1970s, and down from the late 1970s to the present. In the estimates of the error correction model, we find that if the US rate is (say) 1% below the world rate, then all else equal, we expect the US rate to move 40 basis points closer to the world rate in the next year.4 Peculiarly, there is little evidence of a symmetric effect for the long-run world rate to be pulled to the US rate. In the equation for the long-run world rate, the parallel movement is 2 rather than 40 basis points. In any event, the fit is noisy. In the equation for the US rate, the standard deviation of the residual is 260 basis points: despite co-integration, in any given year, substantial divergence between US and world rate is possible.

Figure 2. Long-run world real rate (lt' in blue) and U.S. ex-ante real rate (rUS,t' in black)

Figure 3 plots a forecast for the US rate and the long-run world rate. The forecast for the US rate asymptotes at about 0.4%, with a huge confidence interval. This 0.4% figure rationalises the lower end of our 0%-2% plausible range.

Figure 3. Forecasts for US and long-run world real rates along with 90% confidence intervals for the latter.

Monetary policy implications

All our evidence – from mean reversion or from unit roots, from narrative evidence or from formal regressions – indicates considerable uncertainty about the steady state real rate. Using a small scale New Keynesian model, Orphanides and Williams (2003) argue that uncertainty about exact value of the equilibrium rate will lead a policymaker to move interest rates more slowly than she would in the absence of such uncertainty.

We have evaluated this proposition with the Fed’s ‘FRB/US’ model (the US Federal Reserve Board model), using data that ended in 2014:4. We take data from the December 2014 Survey of Economic Projections as a baseline path for the Federal funds rate and inflation. We assume that policymakers recognise that the actual path may be above or below the baseline. We find that such uncertainty about the future real rate leads to more inertial policy. Lift-off is delayed, and there is a steeper path once rates are raised (see Figure 4).

Figure 4. Alternative funds rate paths

Conclusion

There is much uncertainty about the steady state, or equilibrium, real rate. This rate varies considerably over time. Its determinants are manifold and time-varying, with the effects of trend output growth generally dominated by those of other factors.  Looking forward, a plausible range for the equilibrium rate is wide, perhaps ranging from a little above zero up to 2%. The lower end is consistent with a view that the rate is trendy, or unit root like. The upper end is consistent with the view that the rate will mean revert to its traditional level.

References

Hamilton, J D, E S Harris, J Hatzius and K D West (2015), “The Equilibrium Real Funds Rate: Past, Present and Future” ,Proceedings of the US Monetary Policy Forum.

Laubach, T and J C Williams (2003), “Measuring the Natural Rate of Interest”, The Review of Economics and Statistics 85(4): 1063-1070

Orphanides, A and J C Williams, (2002), “Robust Monetary Policy Rules with Unknown Natural Rates”, Brookings Papers on Economic Activity 2002(2): 63-145.

Summers, L (2013), “Larry Summers Remarks at IMF Annual Research Conference”, available at https://www.facebook.com/notes/randy-fellmy/transcript-of-larry-summers-speech-at-the-imf-economic-forum-nov-8-2013/585630634864563.

Footnotes

1 Details on the discussion below may be found in Hamilton et al. (2015).

2 For example, Laubach and Williams (2003).

3 The ex-ante rate was computed from Federal funds and a forecast of inflation computed from rolling auto-regressions in GDP inflation.

4 For this and other numbers in this paragraph, see equations (5.4) and (5.5) and associated discussion in Hamilton et al. (2015).

Topics:  Macroeconomic policy

Tags:  interest rates, Fed, Federal Reserve


          A 'BRICs' Bank? No Thanks, The IMF And World Bank Are Bad Enough   
A collective effort to secure greater leverage.
          POINTS TO PONDER AND TOP NEWS   

Top World News Now                 
February 26, 2013



United States
Obama To Tell Israelis of Plan for Iran War
Obama's Paycheck Exempt From 'Sequester'
White House Sells Meetings with Obama for $500k
Pentagon to Keep Gen. Allen Probe a Secret
Kerry: US to Hasten Syria Government Change
Kerry’s first overseas trip off to shaky start
Bill unveiled to legalize medical pot
Why Should Taxpayers Give Big Banks $83 Billion a Year?
Listen up ladies! Next time there's a draft, Uncle Sam might want you too
Homeland Security Chief Threatens Long TSA Lines From Sequester
TB outbreak: LAPD urges officers to wear masks
US Internet providers start spy program to stop file-sharing
Billions at stake: US and BP clash in court over Gulf oil spill
Nation of Islam asks for gang protection
New York City homelessness continues to set new records
Canadian Asteroid-Hunting Satellite Launched into Space


Russia
Putin's KGB/FSB Converging with New IMF Banking FSB
Putin signs radical anti-tobacco bill into law
In Putin's Russia, Shooting the Messenger
Medvedev: No Grounds for New ‘Cold War’
Deputy FM Ryabkov: Iran sanctions may be lifted
Zyuganov reelected Communist chief, vows reset in left-wing politics
China, Russia ink major energy deal
Moscow 'regrets' treatment of Russians abroad
Moscow Welcomes Release of 15 Russian Sailors in Nigeria
1kg meteorite piece found in Russian Urals, biggest chunk yet discovered
Moscow Police Seize Large Cache of ‘Black Market’ Weapons
At Least 17 Amur Tigers Dead in Russia's Far East in 2012
Protests in Ukraine as EU gives May ultimatum
Ukraine wields natural gas trump card in Brussels
As Medvedev is savaged, Putin silent
State Duma Backs Putin's Foreign Assets Bill


China
Xi vows peaceful path on Taiwan
Xi calls for cross-Strait cooperation in realizing "Chinese dream"
Xi rewards Chinese missile brigade for launching 100 missiles
Hu Jintao meets KMT honorary chairman
State councilor meets South Korea's new president
South Korea's Park Warns North Against Nuclear Pursuits
Foreign Ministry: All Japanese activities regarding Diaoyu Islands illegal
Min of Environmental Protection refuses to release data from soil contamination investigation
China to halt approvals for small coal mines
2 Tibetan Monks Self-Immolate as Anti-China Protests Continue
Tibet's Growing Tragedy: Self-Immolation Protests Reach 105
5.4-magnitude earthquake jolts Tibet
BBC World Service Shortwave Radio Blocked in China
Chinese transport "workhorses" extending military's reach


United Kingdom
David Cameron: I'll stop migrant benefits
John Kerry: US Won't Back UK on the Falklands
Britain's top cardinal resigns over allegations 'he behaved inappropriately with priests'
Family Targeted in North Belfast Blast Bomb Attack
Cameron to hold talks with Kerry
Head of Cameron's local Tory branch resigns over gay marriage
Clegg denies cover up of associate's misconduct
Tory threat to rival parties over libel law
UK Ratings Cut Puts Spotlight on Budget
Will Litvinenko-MI6 links be revealed?
UK onshore wind farms to create more carbon dioxide than they save
Tax Breaks Spur Record UK Offshore Oil & Gas Spend


European Union
Berlusconi revives political career in chaotic Italian election
Italian markets celebrate Berlusconi’s poor performance in election
Italy's center-left to win lower house, leads in Senate race
Initial results indicate stalemate in Italian election
Angry Italians deliver austerity warning
EU ministers discuss horse meat crisis
EU holds breath over crucial Italy election
Topless Femen protest against Berlusconi as he votes in election
Protest votes add to uncertainty in close Italy election
Spanish Police Nab 3 Suspected of Spying for Iran
Spain police arrest 45 in Madrid after protest


Germany
Merkel holds talks with Turkish leaders frustrated by slow-moving EU talks
Germany presses Turkey for progress in lifting embargo on Cyprus
German government backs ban on far-right party
German Intel Paid Neo-Nazi Informer $240,000
Bare-chested protesters take on Berlin
Merkel: China, Russia seeing Syrian president's time is up
Merkel Raises Turks' Hope Of European Union Entry
Merkel kicks off sensitive visit to Turkey
Merkel inspects German Patriot missiles in Turkey
Germany arms the Persian Gulf monarchies
Germany patient with France on deficit


France
Hollande's Sarkozy joke riles French opposition
Ayrault: Boko Haram Claiming to Hold French Family
France blasts 'cruelty' as Boko Haram displays kidnapped family
France to pause austerity, cut spending next year instead: Hollande
Hollande urges compulsory labeling amid horsemeat scandal
France's military operation in Mali in 'final phase'
France warns of kidnappings, attack risk in Benin
France is euro 'problem child', frets Angela Merkel's party official
War For Global Energy Supremacy-World War III
Syrian Opposition Pledges to Attend Rome Summit
Syria says ready to talk with armed opposition
Kerry Vows Not to Leave Syria Rebels 'Dangling in the Wind'
Car blast rocks central Damascus, casualties reported
Assad's Army Has Fled Entire Area Bordering Israel
Syrian Refugees Riot in Jordan Camp; 3 Hurt
Nearly 100 Rebels Are Reported Killed in Mali Battle
No sign of peace or reconciliation in Mali
West African Mali forces to cost €715m

Insight Into Today’s News
Billionaires Continue To Dump Stocks
G20 issues empty declaration against currency wars
Norway Enters The Currency Wars
The Second-Mortgage Shell Game
The Last Liberal Branch of Government
US/NATO occupation of Afghanistan unraveling
Goodbye? We’ve Lost Who We Are?
US Schools Go Into Full Prison Mode
Hornady Addresses Ammo Shortage: We’re working 24/7
US Media Yet Again Conceals Newsworthy Government Secrets

Israel
Netanyahu: Arrow will help us on peace, or defense
Netanyahu urges the PA to calm rioters and stone throwers
West Bank Streets 'Boiling' as Abbas Accuses Israel of Stoking Unrest
IDF and Palestinians clash following prisoner's funeral
West Bank Protests Grow, Fears of New Intifada
Israel, US successfully test anti-missile system
Palestinian officials accuse Israel of torturing inmate to death
Palestinian Detainee’s Death in Israel Sparks Unrest
Thousands of jailed Palestinians stage 1-day hunger strike


Turkey
Erdogan holds joint press conference with Merkel
Kurdish Peace Process to Start After PKK Leave Turkey
Erdoğan: Assad a ‘mute devil’ for not defying Israel
Defense Minister Says 965 Suicides Among Soldiers in 10 Years
Turkey in Key Stage to Address Kurdish Issue
Turkey lists requests from Germany's Merkel
Turkey eyes Karabakh step from Armenia to open ways
Turkey Pressures Germany on EU Accession
Turkey says aid pledges for Syrian refugees 'unfulfilled'
Iraq shuts down 3 illegal tunnels to Syria


Egypt
Bahrain Bans Import of Plastic Guy Fawkes Masks
ElBaradei Calls for Boycott of 'Sham' Parliamentary Election
Egyptian Brotherhood Hits Back at Opposition Leader
Stripped of 'Country of Origin' Label, US Agrees to Sell Tear Gas to Egypt
Bahraini Dies After Being Struck by Tear Gas Canister
Divided Egypt opposition attacks Morsi on election call
Morsi calls parliamentary elections in April
Thousands hold anti-government protests in Egypt
New death from SARS-like virus in Saudi

Iran
World Powers May Offer Iran Sanctions Relief at Nuclear Talks
UK claims General Shateri actually died in January bombing of Hezbollah-bound weapons convoy
World Powers Seek Compromise in Iranian Nuclear Talks
Ahmadinejad Admits to Economic Pain
Iran tests suicide drones in ongoing military drill
Iran denies downing foreign drone
Iran claims it has captured a foreign ‘enemy drone’ during military exercise
Iran announces new uranium deposits discovery
Iran selects 16 new sites for nuclear plants
Iran sentences 4 to death in biggest bank fraud case
Envoy: Iran to continue talks with IAEA on nuclear program


Venezuela
Chavez warns that Africa and South America Must Unite or face Western Interventions
Indigenous Venezuelans Hold Ritual for Chavez
Colombian Rebels Call on Santos to Save Peace Talks
Villegas: Condition of cancer-stricken Chavez not "favorable"
Prosecutor Accuses Former Colombian Governor of 2000 Massacre
Bolivia's Morales says was unable to see Chavez in Venezuela
Questions about political succession whirl in Venezuela after Chavez comes home
Poll: Maduro would win vote if Chavez goes
Chávez's return is obstacle for Venezuela's embattled opposition
Bolivia's Morales arrives in Venezuela to visit President Chávez


Brazil
Falklands dispute: Argentina accuses UK of ‘defiance’ of anti-nuke treaty
Rousseff says extreme poverty almost eradicated
PM Medvedev begins visit to Brazil
Pro-Cuba Protesters Halt Dissident's Brazil Event
After Being Hounded by Protesters, Cuban Dissident Praises Brazil's Freedom of Expression
Brazil dockers end China ship protest; port strike threat
Argentina to renovate railways with Chinese trains in 2014
Union Leader Protests by Bringing Trucks to Argentine Labor Ministry
New tobacco law ignites controversy in Chile
Ex-leaders of German sect in Chile enter prison to begin sentences for sexual abuse of minors


Mexico
Official Accuses CIA of 'Managing' Not 'Fighting' the Drug Trade
Nieto Meets with San Antonio Mayor
Government Says Over 27,000 People Missing in Mexico
Mexico Slaughters Nearly 500,000 Birds Infected with Avian Flu
Guatemala Moves Up Ex-Dictator’s Genocide Trial
Police Chief in Mexican Border City on Nuevo Laredo Missing
Suspect in General’s Murder Arrives in Mexico
Mexican Police Detain 81 Migrants
Vigilantes reportedly release captives in southern Mexico

Castro successor lacks charisma but is experienced manager
Raúl Castro Says His New 5-Year Term as Cuba's President Will Be His Last
Fidel Castro makes surprise parliament appearance amid leadership speculation
Cuban parliament gathers, president to be selected
Esteban Lazo Elected New President of the Cuban Parliament
Haitians Rage as UN Rejects Payout for Cholera Victims
Yoani Sanchez May Be Top Dissident in Cuba, but She Agrees US Embargo Must Go
Medvedev Discusses Meteorite Strike with Fidel Castro
Raul Castro Mentions Possible Retirement


United Nations
UN Removes Osama bin Laden From Sanctions List
Tunisia Arrests Suspect in Killing That Sparked Unrest
African leaders sign DR Congo peace deal
At least 53 killed in rival Arab militia clashes in North Darfur
Tunisia's New Premier Promises Inclusive Government
US blocks UN resolution condemning Damascus terror bombings
Tunisia: Party Names Premier Candidate
Tunisian PM steps down after crisis prompted by political assassination
Unesco agrees 5.6 million-euro plan to save Mali's cultural treasures
Top World News Now                 
February 21, 2013

COURTESY SOCHA FAAL

 Heads up from AntiMullah. Separate vacations and Obambi brings Reggie Love back with  him. If you do  not know what this is, you need to visit/view AntiMullah.com more often to keep up with latest developments.

Tone and content reflects information not normally provided by Lame Stream Media's love fest with Obambi. And worldwide events that discredit his claims and motives for anti-American, pro-Moslem Brotherhood policies and actions.
 
Read and become knowledgeable and stop believing the incredible lies Obama feeds us at every opportunity. Lies his own Democrats increasingly have a problem swallowing and are intentionally leading our nation into certain fiscal and political destruction.


United States
GOP Resists Obama's Push for Tax Rise to Head Off Cuts
Obama Fleshes Out Plans for Infrastructure Projects
Obama considers urging the Supreme Court to overturn California’s ban on gay marriage
White House announces online espionage response policy
US issues final word on essential benefits under "Obamacare"
Anonymous thrown into China-US cyberwar scandal
Pentagon informs Congress of plans to furlough 800K civilian workers
In wake of Benghazi, rapid response Marine unit heading to Europe
US issues worldwide caution to its citizens of terror threats
Body found in restaurant rubble after Kansas City explosion
Why Americans Might Be Better Off If Their Burgers Were Made Of Horsemeat
Sex-Change Surgery Available Through Many US Colleges
Majority of US citizens say illegal immigrants should be deported
Hundreds of thousands march in Puerto Rico against gay rights
 
 

Russia
Putin Invites G20 Leaders to St. Petersburg Summit
Migrant workers call on Putin for amnesty
Lavrov: Time to end the war in Syria
Moscow: N. Korea sanctions can only impact nuclear program
IMF warns of higher inflation, slower GDP growth in Russia
Russia's missing billions revealed
Russia Tries To Remove Images of New Drone From the Internet
Russian Military to Develop Anti-Meteorite Defenses
Russia investigates 25 cases of Defense Ministry fraud - Prosecutor General
MP resigns after bloggers disclose his Florida property
Russia escalating attacks on free expression a year on from Pussy Riot protest
‘Ample Evidence’ Linking Ukraine Ex-President to Journalist Murder
French Specialists Resume Work at Chernobyl Disaster Site
Ukraine: Embezzlement At State Orphanages
Belarus Phases Out Russian Warplanes, Radars
 
 

China
Xi Jinping's campaign to purge Communist Party 'won't be easy'
Incumbent cabinet holds final meeting
China's central banker skips retirement bar to stay on
Manila to tackle sea row 'with or without China' at UN
Attacks originating from US rank 1st among overseas hackings in China
Photos show new activity at N Korea nuclear site
Spy agencies scrounge for details on North Korean nuclear test
North Korea: A nuclear 7-Eleven?
N Korean propaganda video shows Obama in flames
US Envoy Opposes S Korean Nuclear Armament
Rise in online fan clubs extolling China's party leaders
After China's multibillion-dollar cleanup, water still unfit to drink
Smog in Pearl River Delta 'worse than in Beijing'
Maoists Block Deal to Break Nepal's Long Political Deadlock
 
 

Cameron to pay respects to victims of Amritsar massacre
Cameron's India trip hits wobble with concern over helicopter deal
Sars-like virus death reported in UK
New coronavirus can infect human lungs as easily as cold virus
Magdalene laundries: Ireland to apologise to survivors
Iranian torture guard refused UK citizenship
Britain expands "bigger than burgers" horsemeat tests
Regulator warns Britain 'on the brink' of energy crisis
Scotland 'faces EU funding cut'
Tanker drivers in Scotland vote to strike
Belfast Orange Order warns members over flag protests
One in four Africans attacked in Ireland
 
 

Berlusconi accused of trying to buy votes days before election
After Bulgarian Protests, Prime Minister Resigns
Greek police fire tear gas on anti-austerity protesters
Greece welcomes Hollande with ‘news blackout’
Dutch experiment in legalised prostitution a disaster
Thieves in Belgium pull off most spectacular and dramatic diamond heist in years
Iceland considers dropping its currency
Lawmakers Threaten to Veto Tightened Budget
EU reinforces sanctions against DPRK
To Revive Honey Bees, Europe Proposes a Pesticide Ban
Anti-austerity strike to bring Greece to a standstill
Italy politicians make final drive for votes before poll
 
 

Berlusconi's possible comeback a nightmare for Angela Merkel
Merkel's Rainbow Problem: On Gay Rights, Chancellor Still a Conservative
German Officials Signal Berlusconi Isn't Their Man
Germany Sends Troops to Mali
German police raid firms over Ponzi scheme
Germany: Court Backs Adoption by Same-Sex Couples
Net activists slam Germany's open data portal
NSU victims' families want more than sympathy
Security staff at Hamburg airport to strike Wednesday in pay dispute
Swiss mayoral candidate 'pro-Hamas, pro-Iran'
Outgoing chairman of Switzerland's Novartis foregoes $78 million golden parachute deal
Norway is Afraid of Foreign Spies
 
 

Hollande: French soldier killed in northern Mali
Hollande confirms seven kidnapped in Cameroon
Hollande urges investment in Greece, growth in Europe
Hollande: France will miss 2013 growth target
French Kidnapped in Cameroon Were Taken Into Nigeria
France saw 58 percent rise in anti-Semitic attacks in 2012
Man arrested for serial attacks on Paris Chinese
France to unfreeze development aid to Mali
France Charges 11 In Alleged Kurdish Extortion Ring
 
 
War For Global Energy Supremacy-World War III
Syrian rebels threaten Hezbollah with 48-hour deadline
Syrian military reportedly shoots down Israel drone
US direct military support to Mali likely to continue after elections
Mortars Explode Near Assad Palace in Damascus
Missile kills more than 30 in Syria
Typhoid breaks out in rebel-held eastern Syria
Foreign Arms Supplies to Syrian Rebels Expanding
Pro-Assad militia now key to Syrian government’s war strategy
Russia's double dealing on arms to Assad regime leaves UK isolated over Syria
Syrian Rebels Threaten to Attack Lebanon Over Border Dispute
 
Insight Into Today’s News
Billionaires Continue To Dump Stocks
G20 issues empty declaration against currency wars
Norway Enters The Currency Wars
The Second-Mortgage Shell Game
The Last Liberal Branch of Government
US/NATO occupation of Afghanistan unraveling
Goodbye? We’ve Lost Who We Are?
US Schools Go Into Full Prison Mode
Hornady Addresses Ammo Shortage: We’re working 24/7
US Media Yet Again Conceals Newsworthy Government Secrets
 

Former foreign minister Livni joins Netanyahu coalition
Prisoner X: Benjamin Netanyahu adds to mystery
Secretary Kerry to skip Israel in first trip
Turkey, Israel Cut 1st Defense Deal Since Freezing Ties
Israel Seeks to Curb Weapons Flow to Gaza
West Bank protesters rally for release of deteriorating prisoners
Palestinian Prisoner's Hunger Strike Reaches 211th Day
Fatah Official Warns of Violence if Prisoners Aren't Freed
'Iron Dome' may be instrumental in peace process
Head of Israeli IVF unit arrested in Romania
 
 

 
 

Security deteriorating in Egypt due to political instability
Opposition Sets Conditions For Dialogue With Morsi
Morsi's advisory team less diverse after months of walkouts
Morsi Issues Presidential Decree to Appoint New Mufti
Strike, Protests Hit Egypt's Port Said for 3rd Day
Egyptians protest at Libyan border over new visa rules
Egypt ministry appeals against order to block YouTube
Egypt files new charges against Mubarak's last premier
2 Sunni groups halt roles in Bahrain crisis talks
A Palace Rift in Bahrain Bedevils Key US Navy Base
 

Iran to Conduct Military Drills Over 3 Days
Reformists Meet Khamenei To Improve 'Internal Climate'
Rivals Forced to Apologize to Supreme Leader
Ahmadinejad threat to cancel Iranian poll
Iran Pushes Nuclear-Free Mideast Plans
Syrian Prime Minister Claims Iran is Now “Occupying” Syria
MPs say sovereignty over three Persian Gulf islands is non-negotiable
Iran protests Berlin film award for banned Jafar Panahi
Fatwa Issued Against 3G Internet Operator in Iran
Iran FM Spurns Western 'Gold Trade' Offer
Stung by 'Argo,' Iran Backs Conference Denouncing 'Hollywoodism'
 
 

For the Week:

The S&P500 dipped 0.6% (up 8.2% y-t-d), and the Dow slipped 0.2% (up 8.0%). The Utilities fell 2.5% (up 6.2%). The Banks surged 4.4% (up 4.2%), and the Broker/Dealers jumped 2.6% (up 9.8%). The Transports rose 1.9% (up 5.7%). The S&P 400 Midcaps added 0.2% (up 5.2%), while the small cap Russell 2000 was unchanged (up 4.3%). The Nasdaq100 dropped 2.7% (up 16.1%), and the Morgan Stanley High Tech index sank 3.0% (up 20.3%). The Semiconductors were hit 4.9% (up 14.2%). The Biotechs dropped 3.9% (up 25.5%). With bullion dropping $15, the HUI gold index sank 4.5% (up 1.9%).

Three-month Treasury bill rates ended the week at 100 bps. Two-year government yields gained four bps to 1.38% (up 19bps y-t-d). Five-year T-note yields rose 13 bps to 1.89% (down 4bps). Ten-year Treasury yields jumped 16 bps to 2.30% (down 14bps). Long bond yields increased 12 bps to 2.84% (down 23bps).

Greek 10-year yields were little changed at 5.36% (down 166bps y-t-d). Ten-year Portuguese yields rose 10 bps to 3.03% (down 72bps). Italian 10-year yields surged 24 bps to 2.16% (up 35bps). Spain's 10-year yields jumped 16 bps to 1.54% (up 16bps). German bund yields surged 21 bps to 0.47% (up 26bps). French yields rose 21 bps to 0.82% (up 14bps). The French to German 10-year bond spread was unchanged at 35 bps. U.K. 10-year gilt yields jumped 23 bps to 1.26% (up 2bps). U.K.'s FTSE equities index fell 1.5% (up 11.2%).

Japan's Nikkei 225 equities index declined 0.5% (up 4.8% y-t-d). Japanese 10-year "JGB" yields gained three bps to 0.09% (up 5bps). France's CAC40 sank 2.8% (up 5.3%). The German DAX equities index was hit 3.2% (up 7.4%). Spain's IBEX 35 equities index fell 1.8% (up 11.7%). Italy's FTSE MIB index declined 1.2% (up 7.0%). EM equities were mostly higher. Brazil's Bovespa index rallied 3.0% (up 4.4%), and Mexico's Bolsa gained 1.8% (up 9.2%). South Korea's Kospi increased 0.6% (up 18%). India’s Sensex equities index declined 0.7% (up 16.1%). China’s Shanghai Exchange rose 1.1% (up 2.9%). Turkey's Borsa Istanbul National 100 index added 0.8% (up 28.5%). Russia's MICEX equities index gained 0.6% (down 15.8%).

Junk bond mutual funds saw outflows of $1.735 billion (from Lipper).

Freddie Mac 30-year fixed mortgage rates dipped two bps to 3.88% (up 40bps y-o-y). Fifteen-year rates were unchanged at 3.17% (up 39bps). The five-year hybrid ARM rate gained three bps to 3.17% (up 47bps). Bankrate's survey of jumbo mortgage borrowing costs had 30-yr fixed rates up a basis point to 4.01% (up 34bps).

Federal Reserve Credit last week added $0.8bn to $4.431 TN. Over the past year, Fed Credit declined $5.0bn. Fed Credit inflated $1.620 TN, or 58%, over the past 242 weeks. Elsewhere, Fed holdings for foreign owners of Treasury, Agency Debt jumped another $17.9bn last week to $3.310 TN. "Custody holdings" were up $83bn y-o-y, 2.6%.

M2 (narrow) "money" supply last week slipped $4.3bn to $13.510 TN. "Narrow money" expanded $686bn, or 5.4%, over the past year. For the week, Currency increased $2.7bn. Total Checkable Deposits fell $12.7bn, while Savings Deposits gained $6.9bn. Small Time Deposits were little changed. Retail Money Funds fell $4.1bn.

Total money market fund assets added $4.2bn to $2.621 TN. Money Funds fell $96bn y-o-y (3.5%).

Total Commercial Paper declined $5.4bn to $973.6bn. CP declined $77bn y-o-y, or 7.4%.

Currency Watch:

The U.S. dollar index fell 1.7% to 95.628 (down 6.6% y-t-d). For the week on the upside, the Swedish krona increased 3.4%, the British pound 2.4%, the Canadian dollar 2.3%, the euro 2.1%, the Australian dollar 1.6%, the Norwegian krone 1.3%, the Swiss franc 1.2%, the Brazilian real 1.1%, the Singapore dollar 0.8% and the New Zealand dollar 0.7%. For the week on the downside, the South African rand declined 1.6%, the Japanese yen 1.0%, the Mexican peso 0.6% and the South Korean won 0.4%. The Chinese renminbi gained 0.82% versus the dollar this week (up 2.42% y-t-d).

Commodities Watch:

The Goldman Sachs Commodities Index surged 5.3% (down 6.5% y-t-d). Spot Gold declined 1.2% to $1,242 (up 7.7%). Silver slipped 0.5% to $16.627 (up 4.0%). Crude rallied $3.03 to $46.04 (down 15%). Gasoline jumped 5.6% (down 9%), and Natural Gas rose 3.6% (down 19%). Copper gained 2.9% (up 8%). Wheat surged 11.1% (up 29%). Corn jumped 4.2% (up 8%).

Trump Administration Watch:

June 27 – Bloomberg (Steven T. Dennis and Laura Litvan): “Senate Majority Leader Mitch McConnell’s decision to delay a vote on health-care legislation came as a relief to some Republican holdouts, but it sets off what will be a furious few weeks of talks to deliver on the GOP’s seven-year promise to repeal the Affordable Care Act. Senate Republicans went to the White House Tuesday afternoon to meet with President Donald Trump, who also promised his political supporters he would do away with Obamacare. ‘We’re going to solve the problem,’ the president told senators. But Trump also conceded the possibility that the health bill wouldn’t pass. ‘If we don’t get it done, it’s just going to be something that we’re not going to like,’ he said… ‘And that’s OK, and I understand that very well.’”

June 29 – Reuters: “Congress will need to raise the nation's debt limit and avoid defaulting on loan payments by ‘early to mid-October,’ the Congressional Budget Office said in a report… Treasury Secretary Steve Mnuchin has encouraged Congress to raise the limit before the legislative body leaves for their August recess. But it remains unclear if a bipartisan agreement has been struck to allow the limit to be raised, as both chambers continue to be weighed down by health care and tax reform and trying to find an agreement to fund the government after the September 30 deadline.”

June 30 – CNBC (Fred Imbert): “President Donald Trump's White House is ‘hell-bent’ on imposing tariffs on steel and other imports, Axios reported Friday. The plan — which was pushed by Commerce Secretary Wilbur Ross and was supported by National Trade Council Peter Navarro, and policy adviser Stephen Miller — would potentially impose tariffs in the 20% range… During a ‘tense’ meeting Monday, the president made it clear he favors tariffs, yet the plan was met with heavy opposition by most officials in the room, with one telling Axios about 22 were against it and only three in favor, including Trump.”

June 29 – Financial Times (Stefan Wagstyl): “Angela Merkel threw down the gauntlet to Donald Trump as Germany’s chancellor pledged to fight at next week’s G20 summit for free trade, international co-operation and the Paris climate change accord. In a combative speech on Thursday in the German parliament, Ms Merkel also promised to focus on reinforcing the EU, in close co-operation with France, despite the pressing issue of Brexit. But in a sign that it may be difficult to maintain European unity around a tough approach to Mr Trump, Ms Merkel later softened her tone, as she prepares to host G20 leaders in Hamburg next Friday.”

June 27 – Bloomberg (Joe Light): “Two U.S. senators working on a bipartisan overhaul of Fannie Mae and Freddie Mac are seriously considering a plan that would break up the mortgage-finance giants, according to people with knowledge of the matter. The proposal by Tennessee Republican Bob Corker and Virginia Democrat Mark Warner would attempt to foster competition in the secondary mortgage market… Corker and Warner’s push to develop a plan marks Congress’ latest attempt to figure out what to do with Fannie and Freddie, an issue that has vexed lawmakers ever since the government took control of the companies in 2008 as the housing market cratered. The lawmakers’ plan is still being developed, and a Senate aide who asked not to be named cautioned that no decisions had been made on any issues.”

China Bubble Watch:

June 25 – Financial Times (Minxin Pei): “The Chinese government has just launched an apparent crackdown on a small number of large conglomerates known in the west chiefly for their aggressive dealmaking. The list includes Dalian Wanda, Anbang, Fosun and HNA Group. The news that Chinese banking regulators have asked lenders to examine their exposure to these companies has sent the stocks of groups wholly or partly owned by these conglomerates tumbling in Shanghai and Hong Kong. Obviously, the market was caught by surprise. But it should not be… The immediate trigger is Beijing’s growing alarm over the risks in China’s financial sector and attempt to cut capital outflows. In late April, President Xi Jinping convened a politburo meeting specifically focused on stability in the financial system. Foreshadowing the crackdown, he ordered that those ‘financial crocodiles’ that destabilise China’s financial system must be punished.”

June 26 – Wall Street Journal (Anjani Trivedi): “As Beijing looks to rein in companies that have splurged on overseas deals, it is talking up the systemic risks to its financial system. But just how serious is the problem? After all, for years Beijing has urged leading companies to ‘go global,’ and encouraged banks to support them with lending. Its words were taken to heart: Companies like sprawling conglomerate HNA Group and insurer Anbang pushed the country’s outbound acquisitions to more than $200 billion last year… Now… regulators are investigating leverage and risks at banks associated with China Inc.’s bulging overseas deals. It’s clear that Chinese banks are already heavily exposed to China’s big deal makers through basic lending. Chinese lenders had extended more than 500 billion yuan ($73.14bn) of loans to HNA alone as of last year…”

June 26 – Bloomberg: “China may finally be ready to cut the cord when it comes to the country’s troubled local government financing vehicles. Beijing’s deleveraging drive has seen rules impacting LGFV debt refinancing tightened, spurring a slump in issuance by the vehicles, which owe about 5.6 trillion yuan ($818bn) to bondholders and are seen by some as the poster children for China’s post-financial crisis debt woes. Signs the authorities may be taking a less sympathetic view of the sector has ratings companies flagging the possibility that 2017 could see the first ever default by a local financing vehicle.”

June 29 – Reuters (Yawen Chen and Thomas Peter): “The struggles of China's small and medium-sized firms have grown so acute that many are expected to become unprofitable or even go belly-up this year, boding ill for an economy running short on strong growth drivers. The companies - which account for over 60% of China's $11 trillion gross domestic product - have entered the most challenging funding environment in years as Beijing cracks down on easy credit to contain a dangerous debt build-up. Many of the firms - mostly in the industrial, transport, wholesale, retail, catering and accommodation sectors - are already grappling with soaring costs, fierce competition and thinning profits. The strains faced by small and medium-sized enterprises (SMEs) are expected to grow more visible as Beijing deflates a real estate bubble and eases infrastructure spending to dial back its fiscal stimulus.”

June 29 – Reuters (Leika Kihara and Stanley White): “One of Chinese banks’ favorite tools for increasing leverage has staged a remarkable but worrisome comeback just two months after a regulatory crackdown on leveraged investment… Chinese banks’ issuance of negotiable certificates of deposit in June nearly hit the high recorded in March… NCDs, a type of short-term loan, have become extremely popular in recent years with Chinese banks, especially smaller lenders due to their weaker ability to attract deposits. During a clampdown on runaway debt in April, Chinese regulators warned banks against abusing the tool for speculative, leveraged bets in capital markets. But after a deep but brief drop, NCD issuance has risen again as regulatory attention appeared to ease in recent weeks, hitting 1.96 trillion yuan ($287.73bn) this month, up sharply from 1.23 trillion yuan in May and just a touch below March’s record 2.02 trillion yuan."

June 28 – Financial Times (Gabriel Wildau): “Capital flight disguised as overseas tourism spending has artificially cut China’s reported trade surplus while masking the extent of investment outflows, according to research by the US Federal Reserve. A significant share of overseas spending classified in official data as travel-related shopping, entertainment and hospitality may over a 12-month period have instead been used for investment in financial assets and real estate, the Fed paper argued… Disguised capital outflows in the year to September may have amounted to $190bn, or 1.7% of gross domestic product… Chinese households have in recent years looked at ways to skirt government-imposed limitations on foreign investment as its economy slowed and the renminbi depreciated.”

June 28 – Bloomberg (Joe Ryan): “As Elon Musk races to finish building the world’s biggest battery factory in the Nevada desert, China is poised to leave him in the dust. Chinese companies have plans for additional factories with the capacity to pump out more than 120 gigawatt-hours a year by 2021, according to a report… by Bloomberg Intelligence. That’s enough to supply batteries for around 1.5 million Tesla Model S vehicles or 13.7 million Toyota Prius Plug-in Hybrids per year… By comparison, when completed in 2018, Tesla Inc.’s Gigafactory will crank out up to 35 gigawatt-hours of battery cells annually.”

June 28 – CNBC (Geoff Cutmore): “China's economic growth will accelerate because the country will finally get leaders who aren't scared, a former advisor to China's central bank said Wednesday. ‘The most important reason is that there is a new group of officials being appointed ... (who will emerge) around the 19th Party Congress which will be in mid to late October,’ said Li Daokui, who is now Dean of the Schwarzman College at Tsinghua University in Beijing. …Li said the Chinese economy will grow 6.9 to 7 percent by 2018 from 6.7 percent in 2017. China posted 6.7% GDP growth in 2016, the slowest in 26 years. ‘These (new) officials have been carefully, carefully scrutinized before they are appointed so they are clean. They are not worried about becoming targets of anti-corruption investigations,’ he added.”

Europe Watch:

June 26 – Bloomberg (Sonia Sirletti and Alexander Weber): Italy orchestrated its biggest bank rescue on record, committing as much as 17 billion euros ($19bn) to clean up two failed banks in one of its wealthiest regions, a deal that raises questions about the consistency of Europe’s bank regulations. The intervention at Banca Popolare di Vicenza SpA and Veneto Banca SpA includes state support for Intesa Sanpaolo SpA to acquire their good assets for a token amount… Milan-based Intesa can initially tap about 5.2 billion euros to take on some assets without hurting capital ratios, Padoan said. The European Commission approved the plan.”

June 28 – Reuters (Gernot Heller and Joseph Nasr): “Finance Minister Wolfgang Schaeuble… underscored Germany's concerns about what he called a regulatory loophole after the EU cleared Italy to wind up two failed banks at a hefty cost to local taxpayers. Schaeuble told reporters that Europe should abide by rules enacted after the 2008 collapse of U.S. financial services firm Lehman Brothers that were meant to protect taxpayers. Existing European Union guidelines for restructuring banks aimed to ensure ‘what all political groups wanted: that taxpayers will never again carry the risks of banks,’ he said. Italy is transferring the good assets of the two Veneto lenders to the nation's biggest retail bank, Intesa Sanpaolo (ISP.MI), as part of a transaction that could cost the state up to 17 billion euros ($19 billion).”

June 25 – Reuters (Balazs Koranyi and Erik Kirschbaum): “The time may be nearing for the European Central Bank to start discussing the end of unprecedented stimulus as growth and inflation are both moving in the right direction, Bundesbank president Jens Weidmann told German newspaper Welt am Sonntag. Weidmann, who sits on the ECB's rate-setting Governing Council, also said that the bank should not make any further changes to the key parameters of its bond purchase scheme, comments that signal opposition to an extension of asset buys since the ECB will soon hit its German bond purchase limits. Hoping to revive growth and inflation, the ECB is buying 2.3 trillion euros worth of bonds…, a scheme known as quantitative easing and long opposed by Germany… The purchases are set to run until December and the ECB will decide this fall whether to extend it… ‘As far as a possible extension of the bonds-buying program goes, this hasn't yet been discussed in the ECB Council,’ Weidmann told the newspaper…”

June 26 – Bloomberg (Carolynn Look): “It seems the sky is the limit for Germany’s economy. Business confidence -- logging its fifth consecutive increase -- jumped to the highest since 1991 this month, underpinning optimism by the Bundesbank that the upswing in Europe’s largest economy is set to continue. With domestic demand supported by a buoyant labor market, risks to growth stem almost exclusively from global forces. ‘Sentiment among German businesses is jubilant,’ Ifo President Clemens Fuest said… ‘Germany’s economy is performing very strongly.’”

June 29 – Reuters (Pete Schroeder and David Henry): “German inflation probably accelerated in June, regional data suggested on Thursday, suggesting a solid upswing in the economy is pushing up price pressures as euro zone inflation moves closer to the European Central Bank's target. The data comes only days after ECB head Mario Draghi hinted that the bank's asset-purchase program would become less accommodative going into 2018 as regional growth gains pace and inflation trends return following a period of falling prices. In another sign of rising price pressures in the 19-member single currency bloc, Spanish consumer prices rose more than expected in June… In the German state of Hesse, annual inflation rose to 1.9% in June from 1.7% in May…”

June 28 – Reuters (Gavin Jones and Steve Scherer): “He is an 80-year-old convicted criminal whose last government ended with Italy on the brink of bankruptcy - and he may well be kingmaker at the next election within a year. Mayoral elections on Sunday showed four-time Prime Minister Silvio Berlusconi's center-right Forza Italia party remains a force to be reckoned with... ‘Berlusconi sees this as the last challenge of his career,’ said Renato Brunetta, a close ally for over 20 years and Forza Italia's lower house leader. ‘He feels he has suffered many injustices and deserves one last shot. Who can deny him that?’ Matteo Renzi, leader of the ruling Democratic Party (PD), and Beppe Grillo's anti-establishment 5-Star Movement have dominated the national scene in recent years, relegating Forza Italia to a distant third or fourth in the polls. Yet in the mayoral ballots, Forza Italia and its anti-immigrant Northern League allies trounced the PD and 5-Star in cities all over the country, suggesting they have momentum behind them just as the national vote comes into view.”

Central Bank Watch:

June 27 – Wall Street Journal (Tom Fairless): “The euro soared to its biggest one-day gain against the dollar in a year and eurozone bond prices slumped after European Central Bank President Mario Draghi hinted the ECB might start winding down its stimulus in response to accelerating growth in Europe. Any move by the ECB toward reducing bond purchases would put it on a similar policy path as the Federal Reserve, which first signaled an intent to taper its own stimulus program in 2013. But the ECB is likely to remain far behind: The Fed has been raising interest rates gradually since December 2015, while the ECB’s key rate has been negative since June 2014. Mr. Draghi’s comments, made Tuesday at the ECB’s annual economic policy conference in Portugal, were laced with caution and caveats. But investors interpreted them as a cue to buy euros and sell eurozone bonds, a reversal of a long-term trade that has benefited from the central bank’s €60 billion ($67.15bn) of bond purchases each month. ‘All the signs now point to a strengthening and broadening recovery in the euro area,’ Mr. Draghi said.”

June 28 – Financial Times (Dan McCrum and Chris Giles in London and Claire Jones): “Bond and currency markets whipsawed on Wednesday as Europe’s two most influential central bankers struggled to communicate to investors how they would exit from years of crisis-era economic stimulus policies. The euro surged to a 52-week high against the dollar after investors characterised remarks by Mario Draghi as a signal he was preparing to taper the European Central Bank’s bond-buying scheme — only to drop almost a full cent after senior ECB figures made clear he had been misinterpreted. Similarly, the British pound jumped 1.2% to $1.2972 after Mark Carney, Bank of England governor, said he was prepared to raise interest rates if UK business activity increased — just a week after saying ‘now is not yet the time’ for an increase. The sharp moves and sudden reversals over two days of heavy trading highlight the acute sensitivity of financial markets to any suggestion of a withdrawal of stimulus measures after a prolonged period of monetary accommodation.”

June 25 – Reuters (Marc Jones): “Major central banks should press ahead with interest rate increases, the Bank for International Settlements said…, while recognizing that some turbulence in financial markets will have to be negotiated along the way. The BIS, an umbrella body for leading central banks, said in one of its most upbeat annual reports for years that global growth could soon be back at long-term average levels after a sharp improvement in sentiment over the past year. Though pockets of risk remain because of high debt levels, low productivity growth and dwindling policy firepower, the BIS said policymakers should take advantage of the improving economic outlook and its surprisingly negligible effect on inflation to accelerate the ‘great unwinding’ of quantitative easing programs and record low interest rates.”

Brexit Watch:

June 27 – Reuters (Guy Faulconbridge and Kate Holton): “Prime Minister Theresa May struck a deal on Monday to prop up her minority government by agreeing to at least 1 billion pounds ($1.3bn) in extra funding for Northern Ireland in return for the support of the province's biggest Protestant party. After over two weeks of talks and turmoil sparked by May's failure to win a majority in a June 8 snap election, she now has the parliamentary numbers to pass a budget and a better chance of passing laws to take Britain out of the European Union.”

Global Bubble Watch:

June 28 – Wall Street Journal (Richard Barley): “Sometimes financial markets are surprisingly bad at connecting the dots—until they can’t ignore the picture forming before their eyes. The screeching U-turn in bond markets is a good example. The world’s central banks are sending out a message that loose monetary policy can’t last forever. The shift is mainly rhetorical, and action may yet be some way off. But expectations matter, as they did when the Federal Reserve indicated in 2013 that its quantitative-easing program could be wound down. That caused global bond yields to surge, led by the U.S., and sparked extended turmoil in emerging markets. This time, the bond reversal has been centered on Europe. Ten-year German bund yields started Tuesday just below 0.25%, but by Wednesday afternoon stood at 0.37%. That helped lift bond yields elsewhere, since low German yields have been acting as an anchor. The selloff in the bund Tuesday was the worst in 22 months…”

June 28 – Reuters (Sujata Rao): “Global debt levels have climbed $500 billion in the past year to a record $217 trillion, a new study shows, just as major central banks prepare to end years of super-cheap credit policies. World markets were jarred this week by a chorus of central bankers warning about overpriced assets, excessive consumer borrowing and the need to begin the process of normalizing world interest rates from the extraordinarily low levels introduced to offset the fallout of the 2009 credit crash. This week, U.S. Federal Reserve chief Janet Yellen has warned of expensive asset price valuations, Bank of England Governor Mark Carney has tightened controls on bank credit and European Central Bank head Mario Draghi has opened the door to cutting back stimulus, possibly as soon as September. Years of cheap central bank cash has delivered a sugar rush to world equity markets, pushing them to successive record highs. But another side effect has been explosive credit growth as households, companies and governments rushed to take advantage of rock-bottom borrowing costs. Global debt, as a result, now amounts to 327% of the world's annual economic output, the Institute of International Finance (IIF) said in a report…”

June 26 – Bloomberg (Garfield Clinton Reynolds and Adam Haigh): “Greed seems to be running the show in global markets. Fear has fled, and that may be the biggest risk of all. Currency volatility just hit a 20-month low, Treasury yields are in their narrowest half-year trading range since the 1970s and the U.S. equities fear gauge, the VIX, is stuck near a two-decade nadir. While markets have signaled complacency in the face of Middle East tensions, the withdrawal of Federal Reserve stimulus and President Donald Trump’s tweetstorms, the Bank for International Settlements flagged on Sunday that low volatility can spur risk-taking with the potential to unwind quickly.”

June 27 – Bloomberg (Annie Massa and Elizabeth Dexheimer): “The growing market for exchange-traded funds hasn’t been fully put to the test, according to one of the top U.S. speed trading firms. Ari Rubenstein, chief executive officer and co-founder of Global Trading Systems LLC, told lawmakers… that while investment dollars have flooded the U.S. ETF market, the new order has not endured an extreme period of stress. Volatility, a measure of market uncertainty, has remained low. ‘In some ways the markets are a bit untested,’ Rubenstein said… ‘It’s definitely something we should talk about to make sure industry participants are prepared in those instruments.’”

June 29 – Financial Times (Javier Espinoza): “Private equity buyouts have enjoyed the strongest start to a year since before the financial crisis as fund managers have come under intense pressure from investors to deploy some of the record amount of capital they hold. The volume of deals involving private equity firms climbed 29% to $143.7bn in the first half of the year, the highest level since 2007, according to… Thomson Reuters.”

June 27 – Bloomberg (Enda Curran and Stephen Engle): “Investors aren’t sufficiently pricing in a growing threat to economic and financial market stability from geopolitical risks, and the latest global cyberattack is an example of the damage that can be wreaked on trade, Cornell University Professor Eswar Prasad said. His remarks came as a virus similar to WannaCry reached Asia after spreading from Europe to the U.S. overnight, hitting businesses, port operators and government systems.”

Fixed Income Bubble Watch:

June 27 – CNBC (Ann Saphir): “Bond investors may soon pay a hefty price for being too pessimistic about the economy, according to portfolio manager Joe Zidle. Zidle, who is with Richard Bernstein Advisors, believes the vast amount of money flowing into long-duration bonds is signaling a costly mistake. ‘Last week alone, there is a 20-year plus treasury bond ETF that in one week got more inflows than all domestic equity mutual funds, and all domestic equity ETFs combined year-to-date,’ he said… He added: ‘I think investors are going to be in a real painful trade.’”

June 26 – Bloomberg (Mary Williams Walsh): “The United States Virgin Islands is best known for its powdery beaches and turquoise bays, a constant draw for the tourists who frequent this tiny American territory. Yet away from the beaches the mood is ominous, as government officials scramble to stave off the same kind of fiscal collapse that has already engulfed its neighbor Puerto Rico. The public debts of the Virgin Islands are much smaller than those of Puerto Rico, which effectively declared bankruptcy in May. But so is its population, and therefore its ability to pay. This tropical territory of roughly 100,000 people owes some $6.5 billion to pensioners and creditors.”

Federal Reserve Watch:

June 28 – Bloomberg (Jill Ward, Lucy Meakin, and Christopher Condon): “Federal Reserve Chair Janet Yellen gave no indication her plans for continued monetary policy tightening had shifted while acknowledging that some asset prices had become ‘somewhat rich.’ ‘We’ve made very clear that we think it will be appropriate to the attainment of our goals to raise interest rates very gradually,’ she said… In her first public remarks since the U.S. central bank hiked rates on June 14, Yellen said that asset valuations, by some measures ‘look high, but there’s no certainty about that.’ ‘Asset valuations are somewhat rich if you use some traditional metrics like price earnings ratios, but I wouldn’t try to comment on appropriate valuations, and those ratios ought to depend on long-term interest rates,” she said.”

June 27 – Bloomberg (Christopher Condon): “Federal Reserve Vice Chairman Stanley Fischer pointed to higher asset prices as well as increased vulnerabilities for both household and corporate borrowers in warning against complacency when gauging the safety of the global financial system. ‘There is no doubt the soundness and resilience of our financial system has improved since the 2007-09 crisis,’ Fischer said… ‘However, it would be foolish to think we have eliminated all risks.’”

June 28 – Bloomberg (Luke Kawa): “When a trio of Federal Reserve officials delivered remarks on Tuesday, the state of U.S. financial markets came in for a little bit of criticism. When all was said and done, U.S. equities sank the most in six weeks, yields on 10-year Treasuries rose and the dollar weakened to the lowest level versus the euro in 10 months. Fed Chair Janet Yellen said that asset valuations, by some measures ‘look high, but there’s no certainty about that.’ Earlier, San Francisco Fed President John Williams said the stock market ‘seems to be running very much on fumes’ and that he was ‘somewhat concerned about the complacency in the market.’ Fed Vice-Chair Stanley Fischer suggested that there had been a ‘notable uptick’ in risk appetite that propelled valuation ratios to very elevated levels.”

June 27 – Reuters (Guy Faulconbridge and Kate Holton): “With the U.S. economy at full employment and inflation set to hit the Federal Reserve's 2% target next year, the U.S. central bank needs to keep raising rates gradually to keep the economy on an even keel, a Fed policymaker said… ‘If we delay too long, the economy will eventually overheat, causing inflation or some other problem,’ San Francisco Fed President John Williams said… ‘Gradually raising interest rates to bring monetary policy back to normal helps us keep the economy growing at a rate that can be sustained for a longer time.’”

June 29 – Financial Times (Alistair Gray and Barney Jopson): “Regulators have given US banks the go-ahead to pay out almost all their earnings to shareholders this year in a signal of their confidence in the health of the financial system. The Federal Reserve has given the green light to a record level of post-crisis distributions, including an estimated total of almost $100bn from the six largest banks. All 34 institutions passed the second part of its annual stress test, although the Fed did call out weaknesses in capital planning at Capital One… The big six US banks — Bank of America, Citigroup, Goldman Sachs, Morgan Stanley, JPMorgan Chase and Wells Fargo — are set to return to shareholders between $95bn and $97bn over the next four quarters, according to RBC Capital Markets analyst Gerard Cassidy. That is about 50% more than they were able to hand out after last year’s exam.”

U.S. Bubble Watch:

June 27 – Wall Street Journal (Shibani Mahtani and Douglas Belkin): “This is what happens when a major American state lets its bills stack up for two years. Hospitals, doctors and dentists don’t get paid for hundreds of millions of dollars of patient care. Social-service agencies help fewer people. Public universities and the towns that surround them suffer. The state’s bond rating falls to near junk status. People move out. A standoff in Illinois between Republican Governor Bruce Rauner and Democratic Speaker of the House Michael Madigan over spending and term limits has left Illinois without a budget for two years. State workers and some others are still getting paid because of court orders and other stopgap measures, but bills for many others are piling up. The unpaid backlog is now $14.6 billion and growing.”

June 28 – Bloomberg Business Week (Elizabeth Campbell and John McCormick): “Two years ago, Illinois’s budget impasse meant that the state’s lottery winners had to wait for months to get their winnings. Now, with $15 billion in unpaid bills, Illinois is on the brink of being unable to even sell Powerball tickets. For the third year in a row, the state is poised to begin its fiscal year on July 1 with no state budget and billions of dollars in the red. If that happens, S&P Global Ratings says Illinois will probably lose its ­investment-grade status and become the first U.S. state on record to have its general obligation debt rated as junk. Illinois is already the worst-rated state at BBB-, S&P’s lowest investment-grade rating. The state owes at least $800 million in interest and late fees on its unpaid bills.”

June 26 – Wall Street Journal (Lev Borodovsky): “Commercial real estate prices are starting to roll over after reaching record highs, capping a long postcrisis rally. While there is no sign that a decline would mean imminent danger for the economy, Federal Reserve Bank of Boston President Eric Rosengren recently warned that valuations represent a risk he ‘will continue to watch carefully.’ So far, prices have proven resilient, reflecting in part the unexpected 2017 decline of interest rates and the rising capital flows from diverse sources such as U.S. pensions and overseas investors.”

June 28 – Wall Street Journal (Chris Dieterich): “Booming demand for passive investments is making exchange-traded funds an increasingly crucial driver of share prices, helping to extend the long U.S. stock rally even as valuations become richer and other big buyers pare back. ETFs bought $98 billion in U.S. stocks during the first three months of this year, on pace to surpass their total purchases for 2015 and 2016 combined… These funds owned nearly 6% of the U.S. stock market in the first quarter—their highest level on record—according to an analysis of Fed data by Goldman Sachs… Surging demand for ETFs this year has to an unprecedented extent helped fuel the latest leg higher for the eight-year stock-market rally.”

June 27 – Reuters (Kimberly Chin): “U.S. single-family home prices rose in April due to tight inventory of houses on the market and low mortgage rates… and economists see no imminent change in the trend. The S&P CoreLogic Case-Shiller composite index of 20metropolitan areas rose 5.7% in April on a year-over-year basis after a 5.9% gain in March, which matched the fastest pace in nearly three years.”

June 27 – Bloomberg (Andrew Mayeda): “The International Monetary Fund cut its outlook for the U.S. economy, removing assumptions of President Donald Trump’s plans to cut taxes and boost infrastructure spending to spur growth. The IMF reduced its forecast for U.S. growth this year to 2.1%, from 2.3% in the fund’s April update to its world economic outlook. The… fund also cut its projection for U.S. growth next year to 2.1%, from 2.5% in April.”

Japan Watch:

June 29 – Reuters (Leika Kihara and Stanley White): “Japan's industrial output fell faster in May than at any time since the devastating earthquake of March 2011 while inventories hit their highest in almost a year, suggesting a nascent economic recovery may stall before it gets properly started. Household spending also fell in May, leaving the Bank of Japan's 2% target seemingly out of reach.”

EM Watch:

June 28 – Reuters (Brad Brooks and Silvio Cascione): “President Michel Temer called a corruption charge filed against him by Brazil's top prosecutor a ‘fiction’ on Tuesday, as the nation's political crisis deepened under the second president faced with possible removal from office in just over a year. Temer, who was charged Monday night with arranging to receive millions of dollars in bribes, said the move would hurt Brazil's economic recovery and possibly paralyze efforts at reform. The conservative leader said executives of the world's biggest meatpacker, JBS SA , who accused him in plea-bargain testimony of arranging to take 38 million reais ($11.47 million) in bribes in the coming months, did so only to escape jail for their own crimes.”

Geopolitical Watch:

June 29 – New York Times (Nicole Perlroth and David E. Sanger): “Twice in the past month, National Security Agency cyberweapons stolen from its arsenal have been turned against two very different partners of the United States — Britain and Ukraine. The N.S.A. has kept quiet, not acknowledging its role in developing the weapons. White House officials have deflected many questions, and responded to others by arguing that the focus should be on the attackers themselves, not the manufacturer of their weapons. But the silence is wearing thin for victims of the assaults, as a series of escalating attacks using N.S.A. cyberweapons have hit hospitals, a nuclear site and American businesses. Now there is growing concern that United States intelligence agencies have rushed to create digital weapons that they cannot keep safe from adversaries or disable once they fall into the wrong hands.”

June 28 – New York Times (Sheera Frenkel, Mark Scott and Paul Mozur): “As governments and organizations around the world grappled… with the impact of a cyberattack that froze computers and demanded a ransom for their release, victims received a clear warning from security experts not to pay a dime in the hopes of getting back their data. The hackers’ email address was shut down and they had lost the ability to communicate with their victims, and by extension, to restore access to computers. If the hackers had wanted to collect ransom money, said cybersecurity experts, their attack was an utter failure. That is, if that was actually their goal. Increasingly sophisticated ransomware assaults now have cybersecurity experts questioning what the attackers are truly after. Is it money? Mayhem? Delivering a political message?”

June 25 – Reuters: “Qatar is reviewing a list of demands presented by four Arab states imposing a boycott on the wealthy Gulf country, but said on Saturday the list was not reasonable or actionable. ‘We are reviewing these demands out of respect for ... regional security and there will be an official response from our ministry of foreign affairs,’ Sheikh Saif al-Thani, the director of Qatar's government communications office, said… Saudi Arabia, Egypt, Bahrain and the United Arab Emirates, which imposed a boycott on Qatar, issued an ultimatum to Doha to close Al Jazeera, curb ties with Iran, shut a Turkish military base and pay reparations among other demands.”

June 27 – Reuters (Foo Yun Chee): “EU antitrust regulators hit Alphabet unit Google with a record 2.42-billion-euro ($2.7bn) fine on Tuesday, taking a tough line in the first of three investigations into the company's dominance in searches and smartphones. It is the biggest fine the EU has ever imposed on a single company in an antitrust case, exceeding a 1.06-billion-euro sanction handed down to U.S. chipmaker Intel in 2009. The European Commission said the world's most popular internet search engine has 90 days to stop favoring its own shopping service or face a further penalty per day of up to 5% of Alphabet's average daily global turnover.”
          IMF stands for Insanity, Madness, Fraud   

The IMF continues to get it wrong. We're not witnessing Groundhog Day, but insanity. The IMF, central banks and treasury dept are guilty of the madness.

The post IMF stands for Insanity, Madness, Fraud appeared first on Markets and Money.


          Giá vàng hôm nay 2/7: Giá cả cầm chừng, thận trọng túi tiền   

Tuần qua, giá vàng đã đón nhận nhiều thông tin quan trọng có sức ảnh hưởng lớn là bài phát biểu của chủ tịch FED sau đó là ngân hàng trung ương Châu Âu, ngân hàng trung ương Anh. Đồng USD này xuống thấp hơn sau khi Chủ tịch Ngân hàng Trung ương châu Âu Mario Draghi đưa ra gợi ý rằng, ECB có thể sẽ phải thắt chặt chính sách tiền tệ vì rủi ro giảm phát đang dần mờ đi trên thị trường. Giá vàng còn nhận được sự hỗ trợ bởi thông tin các lãnh đạo Đảng Cộng hòa tại Thượng viện Mỹ đã hoãn một cuộc bỏ phiếu về việc cải tổ chăm sóc y tế. Quỹ tiền tệ quốc tế IMF trong một báo cáo đã hạ triển vọng kinh tế Mỹ trong năm 2017 từ mức 2.3% xuống còn 2.1%.
Giá vàng trầm lắng
Giá vàng trong nước theo xu hướng đi ngang tại hầu hết các phiên. Giá vàng trong nước ghi nhận mức giá cao nhất ở những phiên đầu tuần tại: 36,32-36,40 triệu đồng/lượng và mức giá thấp nhất khi ở những phiên cuối tuần: 36,18-36,26 triệu đồng/lượng. Như vậy tính ngay trong phiên đầu tuần, mỗi lượng vàng miếng đã sụt giảm hơn 140 nghìn đồng. Chốt phiên cuối tuần, giá vàng miếng được Tập Đoàn Vàng bạc đá quý DOJI niêm yết ở mức: 36,25 triệu đồng/lượng (mua vào) và 36,33 triệu đồng/lượng (bán ra). Tại Công ty SJC, giá vàng niêm yết chiều mua vào là 36,18 triệu đồng/lượng, ở chiều bán ra có mức giá là 36,40 triệu đồng/lượng. Tại thị trường TP.HCM, chiều bán ra niêm yết ở mức giá 36,38 triệu đồng/lượng. theo Vietnamnet
          Two Policy Updates   
The IMF has been reluctant to participate in the aid package to Greece that runs out the middle of next year. It does not believe that Greek debt is sustainable but recently agreed to provide a precautionary line of credit at the end of the program.
          Comment on Revealed: IMF Has Granted Themselves Complete Immunity From Any Form of Legal Prosecution or Taxation by Eric Stephens   
They ain't my damn ruler...
          Comment on Revealed: IMF Has Granted Themselves Complete Immunity From Any Form of Legal Prosecution or Taxation by Jerilyn Tagman   
Is this real? Cut the bullshit!!!!!
          Comment on Revealed: IMF Has Granted Themselves Complete Immunity From Any Form of Legal Prosecution or Taxation by Wesley Ball   
We're coming for you
           3월의 첫 예배    



어제의 3월의 첫 예배는 정말 오랜만에 행복한 예배 였습니다.


지난 겨우내~~ 김봉현목사님의 설교와 같이 살았다고 해도~ 과언이 아니었습니다.

설교를 듣고 들으면서~ 마음속에서 "그정도면 된거아냐?" 라고 하는 나자신과 그정도에 만족하지 못하는 나자신의 갈등을 발견할수 있었고. 그러한 갈등은 지난 금요일 저녁에 퇴근하면서 들었던, 수련회저녁집회 (2010.02.09 수련회저녁집회) 를 들으면서, 눈물이 터지고, 그러면서 정리가 되기 시작했던것 같습니다.


눈물이 터져버린 부분은, 김봉현 목사님이 경험하였던, 환란과, 하나님에 대하여 화가 난 상태로, 예수원에서 하나님과의 관계를 회복하는 모습에서, 너무나도 흡사했던 나의 모습이 투영되었기 때문이 아닌가 생각됩니다.


20대의 갈등에서, 기독교는 인생의 답이 아니다~ 라고 결론을 내리고, 세속에서의 삶과 주일도 잊고, 그 열심히 살면서도~ "계속 이렇게 나가면 혼날거 같은데.." 하는 위기감. 그리고 바로 닥쳐온 IMF 에서의 파산, 쫓겨내려간, 이천의 교회에서 회복한후에, 구복신앙으로 오해하고, 축복을 기대하면서, 기를쓰고 감당했던, 교회의 사역... 그러나, 원하는 대로 되지 않는 것에 대하여, 하나님께 화가나기 시작했고, 그 분노는 나를 죽을것 같은 상황으로 인도했으며, 살기위해서, 분당의 지구촌교회로 옮기면서, 예배의 기쁨을 다시 회복하였지만, 악한 나의 실존은 다시 구복신앙으로 돌아가려는 싸움을 계속하고 있었습니다.

태생적으로 성실하기만 하여, 무슨일을 시작하면, 중단하지 못하는 나를 잘아시는 하나님은, 강제적으로 1년을 쉬게하셨으며, 그 안식의 의미도 어느정도 깨달았지만, 예전의 나를 완전히 버리지 못하고, 여전히 갈등하면서 지난 1년을 지내왔다고 할수 있다. 그러다 만난 김봉현 목사님의 설교는 무엇이 문제인지, 알게하였고, 깨닫게 했지만, 여전히 포기되지 않는 나를 보면서, 절망하는 겨울을 보내고 있었습니다.

김봉현 목사님이 하나님과 다시 재회하셨다고 하신, 예수원의 나무등걸.... 저도 알것 같습니다. 그 부분에서 나의 눈물이 터졌고... 흐르는 눈물을 기뻐하는 시간이었습니다. 

이제는 움직여야 겠다는 생각으로, 토요일 새벽에 있는 기도회와 목자훈련에 참석하기 위하여, 토요일 새벽에 교회로 올라가면서, 남은 수련회 저녁집회 (2010.02.10 수련회 저녁집회) 의 설교 전반부를 들었습니다. 그 설교는 나의 갈등을 마무리 하는 과정으로 가고 있는데,아마도 수련회의 마지막 날을 마무리 하는 설교이어서, 나에게도 마무리가 되었던것 같습니다.

그리고, 저에 오전에 예배에 참석하기위해서 다시 분당으로 올라가면서, 아내와 같이 수련회 저녁집회의 설교 후반부를 들었는데, 그 메시지를 들으면서, 저와 아내는 예배를 회복해야 하며, 예배는 내가 하나님의 얼굴을 구하는 것이어야 함을 이해 했습니다.

그리고 참석한, 주일 예배~

작년말에 담임목사님으로 교체가 되면서, 교회를 새롭게 세우시는 담임목사님은 저의 필요를 채우시는 듯 "예배회복" 을 부르짖으셨습니다. 모든 공적예배를 담임목사님이 진행할것을 선언하시면서, 예배의 본질을 다시한번 깨우는 시간이었습니다. 아내와 나는 김봉현 목사님의 설교를 들었기에, 그 메시지는 더욱더 강렬하고, 선명하게 다가 왔습니다.

그리고, 예배를 더욱 예배되기 위하여, 예배를 섬기는 사역에 아주 자연스럽고, 즐거운 마음으로 자원할수 있었으며, 모든 사역에서 하나님을 만나기 위하여, 기쁘게 담당할수 있게 되었습니다.

이글을 쓰는 지금... 2년여의 기나긴 터널을 지나 왔음을 깨달을수 있습니다.

그리고, 그 인도자로서 하나님의 쓰임을 받으신 김봉현 목사님... 감사합니다.
목사님의 사역을 축복합니다. ㅠ.ㅠ

- 겨울아찌 / 방창현 -

P.S. 목사님과 예수원 같이 가고 싶군요. 저는 예수원회원은 아니지만, 일반 사람들과는 다른 방법으로 예수원과 조금은 특별한 관계를 유지하고 있습니다. 나무의숨 패밀리와 수련회라도 같이 갈수 있다면, 더할나위 없겠지요. ^^


          7/2/2017: Front Page: Germany: IMF in Greek bailout for ‘last time’   
The International Monetary Fund, a key creditor in Greece’s bailout, will not participate in any further rescues of the debtwracked country, Germany’s finance minister told a Greek newspaper yesterday. “We have all acknowledged [Eurozone and IMF] that...
          Market forces will drive climate change efforts as US exits Paris agreement   

·         US exit from COP21 won’t impact climate protection efforts
·         UAE opportunity to lead Middle East in growing renewable energy infrastructure
·         Berlin Green Investment Summit gathers financial, scientific and political leaders
Dubai, United Arab Emirates, 20 June 2017: Following the announcement by President Donald Trump that the United States will withdraw from the COP21 agreement, leading impact investor Jochen Wermuth, Founder and CIO of Wermuth Asset Management, has said that the move will not be detrimental to climate protection efforts. Speaking at the Berlin Green Investment Summitat the offices of the Tagesspiegel on 20 June, Wermuth said that market forces will dictate the path of climate change, following the strong growth and resulting competitiveness of renewable energy and electric vehicles.
The conditions for investment in renewable energy in the Middle East are healthy. The cost of solar energy in Dubai is now approximately USD 3 cents per kilowatt. Commitments have been made by leading Middle East countries, such as the UAE, to develop solar energy production. The Mohammed bin Rashid Al Maktoum Solar Park, for example, is a USD 13 billion project that will produce 5 gigawatts of power once completed. As a project developed in the oil-rich UAE, this is a clear example that environmental sustainability is now increasingly high on the regional economic agenda.
The global cost of energy generation from wind and solar power has continued to fall and is now offered at less than $3cent/kWh, with which oil can only compete at a price below $5/barrel. Electric vehicles are competitive, with 250 million Chinese drivers now using 100% electric cars, scooters and bikes. Meanwhile, the cost of storage is also falling rapidly. In many developed markets, renewable energy is more competitively priced than fossil fuel alternatives without the support of government subsidies, and therefore an obvious choice for forward-thinking investors.
Fossil fuel subsidies, however, remain an issue. The health costs of burning a ton of CO2 (eg. through asthma, allergies and cancer) are estimated by the IMF to be around 60/ton of CO2, with global climate change costs of around 70/ton. The total cost amounts to around 130/ton, which is what Sweden, the fastest growing OECD economy for the past 20 years, charges for CO2 emissions. According to the EU Emission Trading System (ETS), the price of CO2 emissions is as low as 5/ton, with some estimates for the price of CO2 globally as low as negative 150/ton (subsidised). In May 2017, the High Level Commission on Carbon Prices, led by Nobel Laureate Joseph Stiglitz and Lord Nicholas Stern concluded that an immediate move to CO2 prices of at least €40-€70/ton is required to limit further misallocation of capital and to have a chance of reaching the Paris agreement’s target of no more than 1.5 degrees Celsius global warming.
Jochen Wermuth commented:
“Trump’s withdrawal from the Paris agreement is not the catastrophe it seems. Mega-trends in ever cheaper renewable energy, electric mobility and storage are well established and backed by their competitiveness. As recently as a year ago, such a decision could have been detrimental, now it simply means parts of the US will be left behind. The EU and China are leading the green industrial revolution and will assume global economic leadership. The economic case for moving into renewables before the carbon bubble bursts is well understood. Market forces are now climate change’s best friends. The world of fossil fuels is slowly coming to an end, and is set to become as outdated as an unreconstructed US president attempting to extend the life of America’s coal and oil industries.”
In investment terms, major global corporates, insurers, and other institutions have shown a growing appetite, and are delivering on commitments, to divest from fossil fuels. They realize that the financial risk associated with investment in exploration for oil, coal and gas is growing. The international Divest Invest programme, which establishes commitments to investing away from fossil fuels and into environmentally-friendly alternatives, calculates that over USD 5 trillion has been withdrawn from oil, gas and coal companies by institutional and private investors globally.
Wermuth continued:

"Resource-efficient and green power companies not only contribute to the reduction of CO2 emissions, but are economically attractive and therefore offer profitable investment opportunities now and in the future. Investments in companies with established business models in the areas of resource efficiency, renewable energy and electro-mobility - whether through the purchase of shares or bonds, or private equity investments - will continue to grow in importance. In this context, growth stage private equity investment is key, as many companies in the emerging technologies space will be absent from stock markets for some time. The historical comparison is striking: the champions of the last industrial revolution - the Siemens, Rockefellers and JP Morgans - were not listed from inception, but all eventually took their place as champions, eventually replacing all but one of the constituents of the first Dow Jones Index, which had been made up mainly of steam engine railway companies. The upside potential of the green industrial revolution can therefore mainly be realised by investing in growth stage private equity, which will be of critical importance for asset allocation by institutional investors, not just for the returns it offers, but also for the strategic information new technologies and business models provide for other assets, such as bonds of oil-producing nations.”

          Business Game Changers Radio with Sarah Westall: Will the US Economy Collapse and what is China’s End Game?   
EpisodeMany economists around the world are predicting a stock market crash this fall. Some are predicting full-blown collapse, while others are merely predicting a major correction in the markets. Perhaps the later are optimists or are motivated to help keep the public calm? Maybe the others are just fear mongers? Regardless, there is widespread consensus that the US economy is very fragile and according to the IMF and the Bank of International Settlements, the world is defenseless against the nex ...
          Business Game Changers Radio with Sarah Westall: World Bank Insider: Currency Reset 95% Likely   
EpisodeKaren Hudes, World Bank Attorney for 20 years, explains the process behind the currency reset being planned as well as the corruption she witnessed at the World Bank and amongst the largest global banks. She explains how the IMF and the World Bank functions, the power structure, and discloses the four owners of the Federal Reserve.Karen studied law at Yale Law School and Economics at the University of Amsterdam. She worked in the legal department of the World Bank from 1986-2007. Karen warne ...
          Gold Rally Continues, Yuan/Dollar Peg Explained – Ep. 45   
Biggest 7-day surge in Gold prices since 2011 U.S. GDP will be lower than in Canada this year Canadian gold production will rise in 2015 Gold is rising against most currencies except the Swiss Franc The IMF still believes the U.S. economy is recovering Outlook for gold in Australia is also positive The Yuan will probably be the next peg to go, allowing it to rise against the dollar The American workforce is being rewarded for incurring large debt to engage in unproductive careers
          Pak-Rupee Makes Record Low   
The Pakistani rupee fell to a fresh record low on Saturday on negative sentiment about the country's economic outlook, as well as the deteriorating security situation in Pakistan's financial hub Karachi. The rupee closed at 86.95/99 to the dollar -- its weakest ever closing -- down from the previous record low of 86.85/90 on Friday. Dealers said they expect the currency to remain under pressure, as dollar payments are typically higher in July and August because of stronger oil demand and debt payments.

'The rupee was traded as high as 87 against the dollar,' said a dealer at a local bank. 'There were no payments today but there are some due on Monday so there was some position building plus the sentiment is still very weak.' Stalled payments from a bailout program by the International Monetary Fund (IMF) is also negatively impacting the rupee.

The IMF has criticized the Pakistan government for its patchy implementation of fiscal reforms, and has held back the sixth tranche of an $11 billion bailout program since August last year.
IMF and Pakistan officials were due to meet last month, but the meeting has been delayed and no new date has been announced.

Dealers said increased remittances from Pakistanis working abroad had supported the rupee and shielded the currency from a sharp fall in recent weeks, but increased dollar demand over the last week has pushed the rupee lower. According to official data, remittances rose 38.57 percent to $1.1 billion in the first month of 2011/12 fiscal year, compared with $791.18 million in the same period last year.

Dealers also said there were fears of portfolio inflows, which was driving down the sentiment. Dealers said the security situation of Karachi was also weighing down the rupee as at least 65 people have died in the violence which erupted on Wednesday, according to police officials. The commercial hub of Pakistan has been gripped by political and ethnic violence as well as gang wars in recent months.

          Tunisia's Challenges and Opportunities   
Tunisia's Challenges and Opportunities
Tunisia is back on a path to economic growth. But some serious challenges stand in the way. Taking bold steps today can lead to even bigger gains. The IMF is a partner with Tunisia to attain those goals.
Date: Thu, 29 Jun 2017 03:00:00 -0700
Location: , , International Monetary Fund
Program and discussion: http://fora.tv/2017/06/29/Tunisias_Challenges_and_Opportunities

          L'Informatiu Cap de Setmana - 01/07/2017   

Són les impressionants imatges de la violenta tempesta que ahir va inundar i emblanquir Girona de calamarsa. Van arribar a caure 52 litres per metre quadrat en tan sols mitja hora i els serveis d'emergència van rebre més de mig miler d'avisos. Una calamarsada que va tancar ahir el juny més calorós i també el més insòlit de la història. I avui ens hem llevat amb temperatures molt baixes per a un primer de juliol.

L'altre punt informatiu del dia és al Paranimf de la Universitat de Barcelona, on més de mig miler d'alcaldes donent suport al Referèndum. Els ajuntaments sobiranistes han escenificat el seu suport a la consulta que la Generalitat vol fer l'u d'octubre amb la lectura d'un manifest on es comprometen a cedir locals per a la celebració del Referèndum. Els alcaldes de Barcelona, Tarragona i Lleida no hi han assistit.

El Grec aixeca el vol i inicia un viatge ple de dansa, música, teatre i circ a a Grècia i al Mediterrani. El Festival compta enguany amb més d'un centenar d'espectacles, una trentena dels quals són produccions internacionals.

Segurament serà el casament més blaugrana de la història, el de Messi i Antonella. Gairebé tota la plantilla actual del Barça, i molts exjugadors. I també companys de l'albiceleste, han assistit aquesta matinada a l'enllaç de l'astre blaugrana amb la seva parella de tota la vida. La celebració, amb molt glamour i més de 250 convidats, s'ha fet a llur ciutat natal, Rosario, a l'Argentina.

 


          IMF Executive Board Approves US$16.1Million Disbursement Under the Rapid Credit Facility for The Gambia   
> IMF Executive Board Approves US$16.1Million Disbursement Under the Rapid Credit Facility for The Gambia IMF Executive Board Approves US$16.1Million Disbursement Under the Rapid Credit Facility for The Gambia Posted on: 27 June 2017 IMF Executive Board Approves US$16.1Million Disbursement Under the Rapid Credit Facility for The Gambia.
          Some curb on capital account convertibility justifiable: Reddy   
Former RBI Governor Y V Reddy has said as the head of the central bank, he had resisted the full capital account convertibility of rupee and now even the IMF has come to a conclusion that some restrictions in this regard are desirable. Reported by DNA 3 hours ago.
          Two Policy Updates   
The IMF has been reluctant to participate in the aid package to Greece that runs out the middle of next year. It does not believe that Greek debt is sustainable but recently agreed to provide a precautionary line of credit at the end of the program.
          Puigdemont diu que l'estat espanyol «amenaça» els alcaldes perquè els té por   
El President s'envolta de 500 alcaldes independentistes, molts de la Catalunya Central, en un acte al paranimf de la UB

Puigdemont diu que l"estat espanyol «amenaça» els alcaldes perquè els té por


          THE CASE FOR CHANGE   
The reality is that Oppositions seldom win elections ... Governments lose them (although that mantra is skewered just a tad by MMP).

The job of the Opposition is to convince the great unwashed that the country is going to hell in a hand-basket and that they offer an alternative that is a panacea for all ills, real and imagined.

Their task is made all the more difficult when almost every indicator has New Zealand punching above its weight in the world.   Apart from the obvious ones ... near record low unemployment; low inflation; low interest rates; a budget in surplus and growing; more new jobs on offer (85,000 in Auckland alone by 2021 with Northland, Waikato, BOP, Nelson, Tasman, Marborough and Otago all expected to exceed 2% real job growth over the same period ... source Infometrics Mar 2017) consider this ...

NZL is rated 1st out of 189 economies for ease of doing business (World Bank 2017)

NZL is rated third out of 178 economies in the Index of Economic Freedom (Heritage Foundation 2017)

NZL is rated 1st out of 142 economies in the World Prosperity Index (Legatum Institute 2016)

NZL is rated 1st = out of 168 economies in the Corruption Perception Index (Transpirancy International 2016)

NZL is rated 13th out of 188 economies in the Human Development Index (UN 2017)

NZL is rated 17th out of 141 economies in the Global Innovation Index (Cornell University 2016)

NZL has the 35th Highest GDP per capita in the World (in purchasing power parity terms ... IMF 2017).

So the simple question is why would you put all of this at risk with proposals from the other parties on offer that include shooting every 4th cow; the taxing of water; the compulsory repurchase of shares; bribes around 'free' university education (paid for by the taxpayer); a return to protectionism; reopening of the KiwiRail spur line to Gisborne that makes no economic sense; an acceleration of moves to combat global warming so called to the determent of the productive sector; the abandonment of the NZDF Capital Equipment Programme; the scrapping of Charter Schools and a return to the one glove fits all approach ... the list goes on.

The political pendulum will swing one day but not this time round.   National will form a Government and more likely than not NZ First will be part of the equation.     The real challenge for National will be in 2020.    NZ First will not survive in any substantial way post WRP especially, as history shows us, junior parties in a coalition government tend to suffer more than their senior coalition partner.   Come 2020 and National could find itself scratching for allies. 


          Boston And Corfu - A Tale Of Two Jazz Schools   
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Nov 1st 2013, 23:35, by noreply@blogger.com (Ronan Guilfoyle)




A couple of recent trips I've taken have shown the breadth of jazz education and how it can function in very different environments and on different scales, (no pun intended!). 

In the middle of October I went to the Berklee InternationalNetwork 20th Anniversary meeting at the renowned Boston school. The BIN network is an international organization made up of schools from all around the world, all of whom collaborate with Berklee in a range of ways, from curriculum sharing to credit transfer. The school in which I work, Newpark Music Centre in Dublin, has been a member for almost 10 years, and like most of the schools in the organization, we operate on a tiny scale compared to Berklee. We have 120 full time students in our school, and Berklee has 4,400 – that gives you an idea of the disparities in the size of our respective organisations.

Berklee is a giant organisation, and one which is still growing, with a new campus opened two years ago in Valencia in Spain and a new building currently rising into the Boston skyline (pictured above on the left), as well as the numerous buildings they also occupy in that city. Its facilities are second to none, with state of the art studios and performance spaces, as well as the usual classrooms and practice facilities. Berklee's giant size and fame has generated hostility as well as admiration in jazz education circles, with a viewpoint sometimes being put forward that Berklee's size mitigates against a student there getting a true quality and artistic education there. This is both inaccurate and unfair. I never studied there, but I have been a guest teacher there, and of course at our school we have wide experience of dealing with Berklee on an ongoing basis, and the reality is that Berklee has teachers and courses that are every bit as good as the physical facilities they provide. I think it's true to say that in an institution the size of Berklee, it would be easy for a shy and retiring student to get lost, but that's probably true in any school. If you go to Berklee, and you have a good idea of what it is you want to do, you can get great teachers that will help you towards that goal, as well as the benefits of living in a large musical community with a huge amount of activity going on.

One thing Berklee has always been, is a weathervane for jazz education -  as far as the world of professional music making is concerned, it has generally got its finger on the pulse of the music industry and how it relates to musicians. So at this meeting of the various schools connected to Berklee, it was very interesting for me to see how many schools were diversifying away from traditional performance studies and into the worlds of music production, composing for Gaming, film scoring, and other non-performance related pursuits. Berklee themselves have been at the forefront of many of these developments and have also pioneered online learning.



(Representatives of the BIN schools, including yours truly, gather for the family photo)

And listening to my colleagues around the world speaking and talking about their schools and courses, it struck me that as the environment for performing musicians gets more economically challenging by the day, we're already seeing a reaction from the schools in moving away from teaching performance, and towards these other more financially sustainable areas. I can see a situation where in maybe only twenty years time, high level music performance students will be in the minority in non-classical schools, and these other areas will make up the bulk of a typical schools' activities. Demand and supply. After all, who is going to spend four years, (minimum), and a lot of money on learning an instrument, and then play for the door in their professional life?

I do believe that the profession of high level performing musician is completely under threat, and could go the way of the Blacksmith in being a job that was once common, but now only done by specialists...

But this is a whole other conversation, back to the subject matter. So, having attended this meeting with colleagues from all over the world, at the world's biggest music school, a few days later I was off to teach for a few days at the Ionian University on the small and beautiful Greek island of Corfu, and it wouldn't be possible to think of a greater contrast between these two educational events.


(The view from the cafeteria!)

Berklee is in Boston, one of America's largest cities, Corfu is small and extraordinarily picturesque. It is an island very popular with holiday makers, but in October, most of the tourists have gone and you get this end of season feeling from the half empty restaurants and shops - a bittersweet atmosphere that I remembered so well from my last visit there, which had also taken place at this time of the year. I've loved Greece from the first time I went there, and I've loved it more ever since, for so many reasons.

So when an opportunity arose to to go there and teach again, along with the great Dutch drummer Eric Ineke, I jumped at it, and a few days after returning from the hurly-burly of Berklee and downtown Boston,  found myself in the quietness and Mediterranean beauty of Corfu. And from being in an institution that had more than four thousand students, I found myself working with a student body of less than fifty.

I also found myself going from one of the world's richest countries, to one which has been buffeted by economic travails in recent years - a buffeting I know all too well since Ireland has also gone through similar economic ill fortune, and our people have also been immorally impoverished in order to keep rich people rich. Greece is having an even harder time than Ireland and has suffered the economic strictures of the IMF and EU in an even more brutal way than we have. So, apart from any other reason, I was very happy to go to Greece and talk to, and work with the students there, and to be able to remind them, and me, about what is really important and of true value to us all in these horrible days - music.


Eric Ineke

So having ensconced myself in my small hotel, I met Eric for dinner and as always with this great and experienced musician, the talk turned to music in general and jazz in particular and we had a particularly stimulating discussion about the evolution of the rhythm section as a unit in jazz, and who were the greatest exponents of the art of accompaniment. It's always a pleasure being with Eric and his knowledge and experience is in evidence whether you're talking with him or having the immense pleasure of playing with him. Eric has had an amazing career and soon I'll be publishing an interview with him here on this blog in which he talks about his life and career in music. Watch this space.

For several days Eric and I worked together with the students, covering as many different areas as we could in the short time we had - how to make your music feel good, rhythm section playing, a great overview of Elvin Jones' career and music given by Eric, how to improve your rhythmic technique, ensemble playing, and individual bass and drum lessons.


Students from the Ionian University jazz programme

It was a pleasure to work with the students, who were both talented and enthusiastic and the whole programme is a credit to the course leader Dimos Dimitriadis, who has fought heroically to keep jazz education going in 3rd Level education in Greece at a time of great economic difficulty. The musical highlight of the week for me was the gig Dimos, Eric and my old friend the great pianist George Kontrafouris, did when we played at a local arts club to a packed house, and just had so much fun swinging as hard as we could and playing for such a great audience.

Corfu itself is beautiful and my daily commute to work - a twenty minute walk along the seafront to the school - was a highlight in itself. To get an idea of the beauty and character of Corfu that I experienced while there, have a look here.

At the end of my time I was genuinely sorry to leave this beautiful island, these committed musicians and the wonderful people that I met there in everyday life. But this very intense two weeks of travelling between, and working within two very different jazz education institutions showed again the adaptability of the jazz education model, and how it can flourish in two very different environments, and on two very different scales. In both places I met people who love music, who care about it and want it to succeed and who put their talents and energies towards that end.

There are a lot of naysayers about jazz education, but the most charitable thing I can say about them is that they don't understand anything about jazz education and how it works. To see what I saw in two weeks, is to see something inspiring and hopeful, and indeed touching. Despite all the crap, music lives, creativity lives, jazz lives.

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EpisodeMany economists around the world are predicting a stock market crash this fall. Some are predicting full-blown collapse, while others are merely predicting a major correction in the markets. Perhaps the later are optimists or are motivated to help keep the public calm? Maybe the others are just fear mongers? Regardless, there is widespread consensus that the US economy is very fragile and according to the IMF and the Bank of International Settlements, the world is defenseless against the nex ...
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          Benin, A Ponzi Scheme And A Long Wait For Answers   
AFP/File / by Josué MEHOUENOU with Célia LEBUR in Lagos | The IMF estimates nearly 150,000 people were defrauded of more than 150 billion CFA francs in the biggest financial scandal in Benin's history

COTONOU, BENIN (AFP, JULY 02, 2017) -- Sadiatou used to be a well-off trader of traditional cloth at the market in Benin’s economic hub of Cotonou, but now sells school equipment from the doorstep of her home.

In 2010 she sank more than 5 million CFA francs ($8,700) into an investment scheme that promised a quick profit.

“It’s a deposit I should never have made,” she told AFP. “My business took a hit and my health as well. I’ve been depressed for a long time.

“I was counting on the savings I’d make to expand my business. But it was useless. All my money has gone.”

Seven years after what was described as the biggest financial scandal in Benin’s history was revealed, 20 people this week went on trial.

Sadiatou is one of nearly 150,000 people that the International Monetary Fund (IMF) estimates were defrauded of more than 150 billion CFA francs in the Investment Consultancy and Computing Services (ICC Services) case.

Some estimates, however, say as many as 300,000 people were lured into parting with their hard-earned or borrowed cash and life-savings on the promise of 150 to 200 percent per quarter returns.

Despite repeated warnings about investing in so-called pyramid or Ponzi schemes, such scams are becoming commonplace throughout Africa.

Frank Engelsman, who heads the Amsterdam- and Paris-based Ultrascan, which specializes in detecting international financial fraud, says such schemes are booming.

“First, because the infrastructure in big cities of Africa is improving rapidly, both phone as well as Internet infrastructure — and that’s what these fraudsters need.

“Second, because in those cities... police are not trained to handle Internet international communication crimes that always cross a border between the fraudster and the victim.”

In Gabon, a business run by a Pentecostal church pastor, Yves David Mapakou, allegedly swindled up to 30,000 French and Gabonese clients by promising profits on investments.

A complaint was lodged in Paris in August last year.

Africa’s most populous nation Nigeria remains the undisputed champion of fraud, having assiduously developed “419” scams over the years — a reference to the relevant section of the criminal code.

Victims from around the world have been duped into handing over billions of dollars through a barrage of unsolicited e-mail appeals and job offers as well as promises of marriage.

Engelsman said this type of fraud has “spread from Nigeria to neighboring countries” in West Africa, taking advantage of the lack of capacity of law enforcement agencies to investigate.

“Like most bad things like crime, they tend to spread when not put to a halt, widen their scope to improve effect/income.” he added.

Development can even play a part.

“It’s easier when the infrastructure is good, in countries where also the chamber of commerce is registering companies easily and bank accounts are opened, based on one or more registrations,” he added.

The Ponzi scheme in Benin — likened to the one run by Bernie Madoff in the US that saw the financier jailed — involved paying initial investors with the money of new clients.

Textile worker Aline Aklassato said she had “no reason at all not to believe” the scheme would not work.

“Colleagues and friends had made deposits and received dividends,” she added.

“I got dividends myself for two months of 300,000 CFA francs before the difficulties started.”
          YAB PM'S SPEECH TRANSCRIPT AS DELIVERED IN GLOBAL TRANSFORMATION FORUM 22 MARCH 2017, KLCC   


 2017 GLOBAL TRANSFORMATION FORUM
https://www.najibrazak.com/bm/blog/global-transformation-forum-2017/


Assalammualaikum Warahmatullahi Wabarakatuh,
A very good morning,

Distinguished guests,

Ladies and gentlemen,

1. Welcome to the second ever Global Transformation Forum. Hosted by the Malaysian Government, and organised by our Performance Management and Delivery Unit, or PEMANDU, we are honoured to have the World Bank Group Malaysia Global Knowledge and Research Hub as our strategic partner.

2. My welcome is to all of you here – and to all those watching via live streaming on my Facebook page.

3. It’s amazing how time flies. It feels like it wasn’t too long ago when I stood on this very stage to give the opening remarks at our first Global Transformation Forum in 2015. GTF 2015 saw the likes of Arnold Schwarzenegger, Director of the UN Development Programme, the Honourable Helen Clark, Carl Lewis, Lord Sebastian Coe, and Starbucks Co-founder Zev Siegl, among many others.

4. This year’s line-up is just as impressive. We have the undisputed fastest man in the world: Usain “Lightning” Bolt; Sir Richard Branson, who left school at age 16 and went on to build his first record store a few years later. Fast forward nearly 50 years, and Virgin Group is now a multi-billion pound entity.

5. Then we have Chris Gardner, the inspiration behind the Oscar-nominated film “The Pursuit of Happyness”. To any of you who are unfamiliar with his story, for one year Chris was living on the streets of San Francisco with his toddler son.

6. Believe it or not, he slept in the toilet of a railway station, in public parks, under his desk at work when all his colleagues had left. Despite all of this, Chris succeeded in his job as a trainee on Wall Street, and then founded his own successful firm. If that isn’t a transformative story, I’m not sure what is.

7. And of course we have Jack Ma, the founder of Alibaba, a global leader in online and mobile commerce. As was announced last November, Jack has been appointed as Malaysia’s digital economy adviser. In that role, he will share his ideas and experience to spearhead Malaysia’s economy through the development of the Digital Free Trade Zone – which will be the world's first, and which Jack and I will launch later today. I’m excited.

8. The Zone will benefit entrepreneurs by offering a conducive environment for digital companies to carry out business – invigorating Internet-based innovation and thus catalysing the Malaysian economy.

9. The initiative is part of the recently launched National E-commerce Strategic Roadmap which aims to double the country’s e-commerce growth from 10.8 percent to 20.8 percent by 2020.

10. As a spur to this, I announced in the last budget that by the end of next year we want to see the cost of fixed broadband halved, and the internet connection speed doubled.

11. The growth of e-commerce is inevitable. At the moment ASEAN contributes less than one percent of global e-commerce volume. To compete with the United States, Europe and China, and to grow a new and vital sector of the economy, we need to embrace this trend. We need to embrace change and innovation.


12. That’s what makes a forum like the GTF so distinctive. The Global Transformation Forum is about bringing speakers and delegates from around the world to be exposed to creative and innovative solutions to challenging global problems, and to drive transformation. And to hear first hand their experience and how they’ve done it.

13. We’re all here to discover how some of the most successful and iconic business leaders embrace change in this increasingly unpredictable and fast-paced world. How do the greatest sportsmen of our time consistently deliver world-breaking records? What inspires a nation’s leader to catalyse positive socioeconomic change without compromising on fiscal governance?

Ladies and gentlemen,

14. Malaysia has come a long way in the years since independence in 1957. By the 1990s, we had moved into the upper middle income bracket. But the 1997-98 Asian financial crisis hit us hard, and afterwards Malaysia’s economic engine decelerated, despite the global economy being robust during the same period.

15. Economic growth prospects had weakened considerably. Private investment was also stagnant.

16. We had and we needed to take action. So in 2010 we launched the National Transformation Programme – or NTP – to drive Malaysia’s transformation into a high-income nation, based on inclusive and sustainable economic growth.

17. Through the NTP, we focused on clear socioeconomic priorities and introduced six Strategic Reform Initiatives to create better conditions for businesses to flourish.

18. Prior to the introduction of the NTP, we were caught in the middle income trap. To escape this trap, the government has had to make some tough calls, because radical change was necessary.

19. The first was to remove fuel subsidies, despite this being politically unpopular, because they simply weren’t sustainable. By 2012, fuel subsidies reached 25 billion ringgit, accounting for 13.6 percent of the total national Budget. For the sake of the country, subsidies had to be drastically cut. And that is what we did, slashing them to 3 billion ringgit by 2015.

20. At the same time, we reduced government dependence on oil revenue from 41 percent when I assumed office in 2009, to 14 percent today.



21. In a further move to diversify the country’s revenue stream, the second tough and unpopular measure we undertook was to introduce a Goods and Services Tax, or GST. Many parties resisted – including politicians who should and did know better. But had we not taken the risk, we would have been suffering today because of that sharp and sudden decline in oil prices.

22. We would, ladies and gentlemen, have been in dire straits – and facing a massive hole in the country’s budget.

23. Instead, as the result of those tough choices, we built the resilience that – even in these difficult times for the global economy – still saw us register growth of 4.2 percent in 2016. We expect a slightly higher figure for this year, and for it to rise in 2018. These figures show Malaysia growing at more than double the rates the IMF predicts for advanced economies over the same time period.

Ladies and gentlemen,

24. Between 2010 and 2016, the NTP created 1.8 million jobs, of which over one million were high-income jobs.

25. Gross National Income increased by nearly 50 percent.

26. We have almost eradicated poverty, reducing it to just 0.6 percent.

27. We have kept inflation and unemployment low, and have been acclaimed by global institutions such as the World Bank and the IMF for the reforms we have undertaken.

28. We are firmly on the path to become a high-income nation.

29. In short, we have an economic plan. That plan is working, we have delivered, we have delivered and we will continue to deliver.

But, ladies and gentlemen,

30. Breaking through to high income status is only one of the aims of the National Transformation Programme. The NTP also aims to generate benefits for all Malaysians. It is key that no Malaysian gets left behind; that the needs of all our people are met; and that all communities, whether large or small, are able to contribute to and share in the wealth of the country.

31. To help those less well-off cope with rising costs of living, and also to stimulate economic activity in the consumer market, Bantuan Rakyat 1Malaysia – or the 1Malaysia People’s Aid – was introduced in 2012. This provided targeted relief to 7.28 million households earning less than 3,000 ringgit a month in 2016.

32. Additionally, we have the target of building 1.1 million affordable and low-cost homes for middle and low-income households, including housing for civil servants and the new generation of FELDA settlers. We have already completed 21 percent, and another 22 percent are currently under construction.

33. We took these measures because ultimately, a high income economy is only meaningful if it benefits all the people, so that they have more choices, higher purchasing power, opportunities for upward mobility, better quality of life and better living standards.

Ladies and gentlemen,

34. One of the reasons why the NTP has been so successful, and why we have been able to introduce programmes such as BR1M and various targeted housing plans, is because we have maintained a strong focus on two areas: human capital, and connectivity.

35. Our people – our human capital – are our most precious asset. We always want every opportunity to be open for them, and we have instituted a huge range of programmes to ensure that training for the right skills, and funding for entrepreneurs – our future Richard Bransons - are available.

36. There are far too many programmes for me to list them all, but they include new innovation centres; increasing graduate employability; boosting female participation in the workforce, and supporting women’s place in the boardroom and leadership positions; and incentives for companies to support retraining – because with automation and new technology, learning is not something we do just at school or university.

37. It must be a lifetime process, so that we increase productivity – we need to increase the rate from the current 2.3 percent per annum to 4 percent - to ensure that Malaysia is not just ready for the future, but is leading the way in terms of the economy of tomorrow.

38. We are constantly working on this. Just this week, our Human Resources Development Fund launched their Human Capital Strategic Initiatives 2017 – even more measures to help our local workforce be continuously up-skilled and re-skilled.


Ladies and gentlemen,

39. These initiatives and programmes are not just fine words. They have tangible impacts on real people. Let me give you a couple of examples. Take Johorean Zul Izzamin. He inherited Izzamin Mini Market, a sundry shop serving mostly the local community, from his late father in 2000.

40. In 2011, he chanced upon the Small Retailer Transformation Programme (Transformasi Kedai Runcit or TUKAR programme) that was advertised in a newspaper. Zul found that he was eligible, enrolled and took the initiative to implement expert advice from TUKAR programme mentors.

41. He took a 25 thousand ringgit loan offered under the programme and renovated his shop. “Since then,” he says, “our shop income increased by 100-200 percent.” A wonderful example of the NTP in action.

42. Or take Chik Azmily bin Che Abdul Aziz. He and his wife were barely getting by on 500 ringgit a month working as daily labourers in Kelantan.



43. Chik Azmily got involved in the 1AZAM initiative, providing him with agricultural equipment, seeds, fertiliser, and herbicides. He started growing short-term seasonal cash crops such as cucumbers and watermelons and selling them to wholesalers.

44. His wife was provided with sewing machines to kick-start her tailoring work, and she managed to secure a deal with a batik factory to tailor batik shirts. Within a couple of years, they had gone from earning 500 ringgit a month to 5,000 ringgit a month. Isn’t that remarkable?

Ladies and gentlemen,

45. Side by side with our emphasis on human capital has been our emphasis on connectivity. A very important part of that involves communications and cyberspace. I mentioned our plan to double the speed of internet connections and halve the price earlier.

46. We are also in the process of transitioning from IPv4 to IPv6, which is more secure and has a capacity that is much broader and not easily overloaded. And I can assure you that Jack and I have plenty more than that to talk about!

47. But connectivity is also about infrastructure. Again, there are too many examples to list, but one I will mention is our setting of a new benchmark for public transport previously unseen in Malaysia.

48. With the launch of the Mass Rapid Transit, or MRT, last December; with the completion of the LRT Extension Project; and with the ongoing transformation of bus and taxi services, our vision of a modern world-class public transport system in our capital is now within reach.

49. The MRT will carry close to a million people over 100km daily – guaranteeing the people fast, reliable and environmentally-friendly public transportation. And if I could say once again, it is on time and on budget.

50. Likewise, the East Coast Rail Line will be a game changer for Peninsular Malaysia’s east coast, as the Pan Borneo Highway will be for Sabah and Sarawak, and the high speed rail link between Kuala Lumpur and Singapore will be for both our countries – cutting the journey time between our two capitals to a mere 90 minutes.


Ladies and gentlemen,

51. Our ongoing investment in human capital and connectivity, and our ongoing economic transformation and reforms, have had results. One of which is that outsiders look at Malaysia, and they see a place they’d like to do business – and increasingly so.

52. For instance, in 2015 we attracted 36 billion ringgit in foreign investment. Last year that rose to 59 billion ringgit.

53. This leads to healthy and growing partnerships. Take Osram, a global leader in lighting manufacturing. It has already invested 3 billion ringgit in Malaysia. It is now investing an additional 1.4 billion ringgit for an expansion project that will be the newest and largest 6-inch LED chip production site in the world.

54. Would they be doing that if, as some of our opposition politicians say, Malaysia was a failed state?


Ladies and gentlemen,

55. Let me give you another example. Some of you may have heard that Saudi Aramco recently signed an agreement to invest $7 billion – that’s dollars, not ringgit – in the 22,000-acre PETRONAS Pengerang Integrated Complex, or PIC, in Johor.

56. This joint venture won’t just establish new engines of growth and push the nation to a new frontier in technology and economic development. It will also create thousands of new jobs - at the peak of construction, up to 60 thousand new jobs in fact.

57. It will be a huge engine of growth in one of the world’s busiest shipping lanes, and at the gateway into the Asia-Pacific, the most thriving region on the planet with over 60 percent of the world’s population. It will provide training and jobs for locals, lead to the development of auxiliary industries, spur entrepreneurship and be a huge boost to human capital and to the knowledge economy.

58. PIC is very important for us, and that $7  billion shows you the confidence Saudi Arabia’s state-owned oil company has in Malaysia.

59. Again, I ask: would Saudi Aramco be making one its largest investments in a country that was going bankrupt?

Ladies and gentlemen,

60. I raise this question because, as you know, there has been a lot of talk of fake news lately. Unfortunately, the Government’s opponents here in Malaysia often prefer not to engage with us on the facts. They create false propaganda – like the idea that this is a state on the verge of bankruptcy – some of which sadly gains traction internationally.

61. This running down of Malaysia is nothing less than economic sabotage for selfish, personal political gain. If it affects perceptions abroad, it won’t be opposition politicians who will suffer. It will be ordinary Malaysians.

62. The Aramco deal was almost wrecked by such fake news. After all, many would not expect a former leader to tell lies about his own country. So when he tells people that Malaysia is facing bankruptcy, some believe him.

63. In fact, he knows he is telling lies.

64. The truth is the very opposite. Millions of jobs created. Strong and consistent growth. Low inflation and unemployment. The fiscal deficit cut from 6.7 percent in 2009 to 3.1 percent in 2016. Twice the degree of social mobility than in France, Britain or the US.

65. Countless measures put in place to ensure our continued transformation into an innovative, knowledge-based economy, with sustainability and inclusivity at its core. We are working for a nation at ease with others, and proud of its unique and vibrant diversity – because I’m not just concerned about GDP or headline figures, but also public happiness and the well-being of each and every Malaysian.

Now, ladies and gentlemen,

66. I’m not saying that everything is perfect. There are some downside risks and challenges – such as managing household debt, the need to improve productivity and move up the value chain, and the problem of household savings not being sufficient to last people’s lifetimes. But we will address these head on with appropriate measures because we recognize such risks and such challenges.



67. The bigger picture is that neutral observers see what we have done, what we continue to do and our commitment to reform, and they see the results of our transformation programme thus far.

68. This is why all the major rating agencies – Fitch, Standard & Poor’s and Moody’s – and they are not easy to please, I can tell you! – have reaffirmed Malaysia as being in the ‘A’ category.

69. Let’s turn to the IMF, one of the most respected institutions in the world. Its latest assessment of Malaysia said, and I quote: “The Malaysian economy continues to perform well, despite significant headwinds, and has made significant progress towards achieving high-income status.”

70. They commended our reforms and urged us to continue with the transformation I have been sharing with you.

71. And just this month, BAV Consulting and the Wharton School of the University of Pennsylvania released their 2017 Best Countries Report. It said that Malaysia was the best country in the world to invest in. And in this category we were, and I quote: “the clear frontrunner”.

72. So this is the real story, the real facts, and the real news, about Malaysia’s transformation story.

Ladies and gentlemen,

73. In close to eight years, the National Transformation Programme has attracted the attention of the world. Malaysia has emerged as a model for other countries pursuing transformation, and offers valuable lessons that others can draw from. The progress and success of the NTP has been replicated in Tanzania, India, South Africa and Oman.

74. We have also received international recognition for the work that we have done. Just last year, the NTP was the recipient of five awards and topped the list of winners at the Global Good Governance (3G) Awards held in Istanbul, Turkey. And once again, the NTP has been nominated for Best Public Sector Reforms Programme at this year’s 3G Awards.

Ladies and gentlemen,

75. PEMANDU – headed by our renowned turnaround specialist Dato’ Sri Idris Jala – was set up in September 2009 to rigorously monitor the implementation and spearhead the NTP as well as to ensure the delivery of our transformation.

76. I would like to take this opportunity to extend my appreciation to PEMANDU and Dato' Sri Idris, for all their hard work and diligence, and also for their relentless efforts in organising the Global Transformation Forum. I would also like to thank the sponsors and the Forum’s strategic partner, World Bank Group Malaysia Global Knowledge and Research Hub.

Ladies and gentlemen,

77. Even with the achievements I have mentioned under our belt, our work is not done. The Government has recently set a new goal under the 2050 National Transformation plan, which is for Malaysia to be a top 20 country by the year 2050.

78. PriceWaterhouseCoopers have just published a report in which they predict Malaysia will have the 25th highest GDP in the world, measured by purchasing power parity, by 2030 – and the 24th by 2050. So top 20 is within our grasp.

79. But it means there is more to be done. The transformation must be continuous, and my Government will not rest in our efforts towards this.

80. At this point, I would like to express my gratitude to the civil service for their dedication in driving our country towards our aspirations, as well as to the rakyat for their continued support for our initiatives.

81. Let me say to all Malaysians: let’s come together in the spirit of Negaraku – our country, our nation – and unite to continue the transformation and build the Malaysia we all want.

82. Here’s to an exciting future based on an entrepreneurial and innovative spirit – both for Malaysia, and for all participants and speakers at the GTF.

Thank you.
          บรรยง พงษ์พานิช: วิกฤติต้มยำกุ้ง2540 ยี่สิบปีแล้ว เราเรียนรู้อะไรกับมันบ้างนะ   


 

ในวันนี้เมื่อยี่สิบปีก่อน ....2 กรกฎาคม 2540 ตั้งแต่ธนาคารแห่งประเทศไทยเรียกประชุมนายธนาคารทุกแห่งในเวลาเช้าตรู่เวลา 7.00 น. แล้วประกาศว่า ประเทศไทยจะใช้ระบบอัตราแลกเปลี่ยนเงินตราต่างประเทศแบบลอยตัว ให้เป็นไปตามกลไกตลาด ซึ่งหมายความว่า ธปท.จะไม่เป็นผู้กำหนดและจะไม่แทรกแซงขนาดหนักอย่างที่เคยทำมา (ซึ่งทุกคนก็รู้โดยทันทีเลยว่า ธปท.สารภาพว่าเงินทุนสำรองหมดเก๊ะแล้ว ไม่มีเค้าจะแทรกแซงได้อีก) ...และนั่นก็เท่ากับการประกาศจุดเริ่มต้นอย่างเป็นทางการของ"วิกฤติเศรษฐกิจ"ครั้งยิ่งใหญ่ที่สุดที่ประเทศไทยเคยมี ที่เราเรียกกันว่า"วิกฤติต้มยำกุ้ง" ซึ่งในที่สุดก็ลุกลามไปทั่วทั้งภูมิภาค มี Kimchi Crisis ของเกาหลี Abodo Crisis ของฟิลิปปินส์ Gado Gado Crisis ของอินโดนีเชียและNasi Lemak Crisis ของมาเลเซียทยอยตามมาติดๆ

ผมว่าการที่ใช้อาหารประจำชาติมาตั้งฉายาให้วิกฤติเศรษฐกิจที่ลุกลามในครั้งนั้นเป็นเรื่องที่เหมาะมากทีเดียว เพราะการลุกลามนั้นไม่ใช่เป็นการติดเชื้อโรคเท่านั้น แต่เพราะสาเหตุที่แท้จริงนั้นมันเป็นเพราะต่างก็กินอาหารแสลงเหมือนๆกัน นั่นก็คือการลงทุนที่ผิดพลาด (ลงในสิ่งที่มีผลตอบแทนไม่คุ้มค่า) และใช้แหล่งเงินทุนที่ผิดพลาด (เอาเงินกู้ระยะสั้นสกุลต่างประเทศมาลงทุนระยะยาว)

สาเหตุความเป็นไปวิธีการแก้ปัญหารวมทั้งเหตุการณ์ต่อเนื่องจากวิกฤติครั้งนั้น ผมได้เคยเขียนบรรยายรายละเอียดไว้แล้วในบทความยาว 8 ตอน ที่เขียนเมื่อ 2 กค. 2556 - 18 กค.2556 ใครสนใจไปหาอ่านได้ใน ThaiPublica นะครับ ....วันนี้จะพูดถึงบทเรียนที่ได้กับผลจากการแก้ปัญหาและอุทธาหรณ์อื่นๆ

การแก้ปัญหาวิกฤติครั้งนั้นของแต่ละประเทศนั้นแตกต่างกัน ไทย อินโดนีเซีย และเกาหลีใต้ ต่างก็ขอเข้ารับความช่วยเหลือจาก IMF ขอเงินกู้ ($ 17, $42 และ $58 พันล้าน ตามลำดับ) โดยยอมตัวเข้าผูกพันตามโครงการปฏิรูปภายใต้บันทึกข้อตกลง (LOI) ขณะที่ฟิลิปปินส์มีปัญหาไม่มากนัก เงินสำรองมีมากและดุลการค้าก็ได้เปรียบ ถึงแม้ค่าเงินจะลดลงมาก แต่เศรษฐกิจก็ถดถอยเพียงเล็กน้อย(ตำ่กว่า 5% ขณะที่ประเทศอื่นๆมากกว่า10%) ฟิลิปปินส์จึงใช้แค่Technical Assistance คำปรึกษาจาก IMF โดยไม่ต้องขอกู้ ...ส่วนมาเลเซียของคุณพี่มหาเด่ร์นั้นไปอีกแนว ประกาศไม่เอา IMF แถมด่ารายวัน (แหะๆ...จริงๆไม่ใช่รายวันแบบแถวทำเนียบเรานะครับ เป็นแค่ประมาณเดือนละครั้ง) แล้วก็มีการควบคุมการไหลเข้าออกของทุน (Capital Control) แถมกำหนดอัตราแลกเปลี่ยนตายตัว(Fixed Exchange Rate) กึ่งๆปิดประเทศบางส่วน อาศัยว่ามีเงินทุนสำรองค่อนข้างมาก กับราคาน้ำมันซึ่งเป็นสินค้าส่งออกหลักอันหนึ่งปรับตัวดีขึ้นก็เลยรอดตัวพัฒนามาได้

วันนี้วิกฤติผ่านมายี่สิบปีเต็ม ต้องบอกว่าทุกประเทศต่างก็ผ่านวิกฤติมาได้ หลังจากที่ต่างก็ชะงักงันเศรษฐกิจติดลบไปแค่ปีสองปี ในที่สุดก็ตั้งหลักเดินต่อกันได้ ซึ่งแทบทุกประเทศกลับมามีอัตราเติบโตได้ดีซึ่งถ้านับจากปี คศ.2000 ที่ต่างก็ตั้งหลักกันได้จนถึง คศ.2016 ส่วนใหญ่สามารถกลับมาเติบโตในอัตราที่น่าพอใจ ...ฟิลิปปินส์ เติบโตได้เฉลี่ย 4.95% ต่อปี ...ขณะที่อินโดนีเซีย ก็พัฒนาได้ดี เศรษฐกิจเติบโตเฉลี่ยได้สูงถึง 5.3% ต่อปีแถมประชาธิปไตยเบ่งบาน เผด็จการถูกโค่นล้ม ธรรมาภิบาลก็พัฒนา คนโกงโดนลงโทษ ดัชนีคอร์รัปชั่นปรับขึ้นจาก 17 คะแนน มาเป็น 37 คะแนน อันดับพุ่งพรวดจาก 140 มาเป็นที่ 90 ของโลก ...ด้านมาเลเซียที่ก่อนวิกฤติทำท่าจะโดนพี่ไทยแซงหน้าแต่พอหลังวิกฤติกลับเติบโตได้แข็งแรงเฉลี่ยปีละถึง 5.07%จนค่อนข้างมั่นใจว่าจะได้เป็นประเทศพัฒนาแล้วเสือตัวที่ห้าแห่งเอเชียภายในปี 2520 นี้เป็นแน่ ...ข้างเกาหลีใต้นั้น แทบไม่ต้องพูดถึง แม้จะโดนวิกฤติอ่วมต้องพึ่งเงินช่วยจาก IMF ตั้งครึ่งแสนล้านเหรียญ แต่หลังแก้ไข กัดลูกปืนปฏิรูปหลายด้านจนยังเติบโตได้เฉลี่ยสูงถึง 4.19% นับว่าโตมากที่สุดประเทศหนึ่งในเหล่าประเทศพัฒนาแล้วทั้งหลาย จนมีรายได้ต่อคนต่อปีเกือบ $28,000 รำ่รวยเป็นอันดับที่ 25 ของโลก

สรุปว่ามีเพียงประเทศเดียวที่แป้กยาว คือประเทศไทยแลนด์ของเรานี่เอง ที่ 2000-2016 เศรษฐกิจเติบโตแบบต่ำเตี้ย เฉลี่ยแค่ 3.95%ต่อปี โดยที่หกปีหลัง (2010-2016) นี่โตแค่เฉลี่ยปีละ 2.98% ที่ไม่ใช่จะแค่ตำ่สุดในเหล่าประเทศที่โดนวิกฤติเท่านั้น แต่นับว่าตำ่สุดแห่งหนึ่งในโลกในเหล่าประเทศกำลังพัฒนา (Emerging Market) เลยทีเดียว ซึ่งถ้าเทียบกับอัตราเติบโตเฉลี่ยมากกว่า 9% ในช่วงสิบปี (1986-1996) ก่อนเกิดวิกฤติแล้ว นับว่าต่างกันเป็นฟ้ากะเหวเลยทีเดียว

ผมเลยอยากชวนวิเคราะห์หาสาเหตุว่าทำไมวิกฤติเมื่อยี่สิบปีก่อน ถึงได้เปลี่ยนสถานะเราจากหน้ามือกลายมาเป็นหลังตีน จากประเทศดาวรุ่งคั่วตำแหน่งเสือตัวใหม่กลายมาเป็นประเทศติดกับดักฉายา"คนป่วยแห่งเอเชีย"ได้ขนาดนี้ ซึ่งผมขอตั้งประเด็นเป็นข้อๆเพื่อนำไปสู่การวิเคราะห์วิจัยกันต่อนะครับ

1. ในวิกฤติต้มยำกุ้งของไทยนั้น เป็นวิกฤติในภาคเอกชน ที่ลงทุนเกินตัว โดยใช้แหล่งเงินผิดประเภท คือไปกู้ระยะสั้นมาจากต่างประเทศ พอเราถูกบังคับให้ลดค่าเงิน ผู้กู้ก็ล้มระเนระนาด แต่ก็เป็นเพียงพวกพ่อค้าคนรวยส่วนใหญ่ คนทั่วไปถึงจะเดือดร้อนจากการที่เศรษฐกิจหดตัวรุนแรง แต่ก็เป็นเพียงระยะสั้น แถมลักษณะสังคมไทยที่ใครเดือดร้อนตกงานก็ยังโอบอุ้มช่วยเหลือ ไม่มีใครอดตาย ทำให้เราไม่มีวิกฤติสังคมไม่มี Social Unrest ...พอเราลดค่าเงินลงมาก สินค้าเกษตรก็ราคาพุ่งขึ้น เกษตรกรกลายเป็นดีขึ้นมาก สินค้าส่งออกอื่นๆก็พุ่งขึ้นอย่างมากเพราะมี external price adjustment (ลดค่าเงิน) ขนานใหญ่ มีการลงทุนมีการจ้างงานในอุตสาหกรรมส่งออกเพิ่มมาก คนส่วนใหญ่ได้ประโยชน์

2. ประเทศไทยมีวินัยการคลังต่อเนื่องกันมายาวนาน เราจึงมีระดับหนี้สาธารณะที่ตำ่ รัฐบาลจึงมีทางเลือกทางนโยบายที่จะใช้จ่ายเพื่อกระตุ้นเศรษฐกิจได้ค่อนข้างมาก นอกจากนั้นจากการที่เรามีรัฐธรรมนูญ 2540 ที่เน้นการกระจายอำนาจและทรัพยากร กับการให้รัฐบาลมีอำนาจบริหารมากขึ้น ทำให้เกิดนวัตกรรมประชานิยม ที่เอาทรัพยากรส่วนกลางไปใช้จ่ายแจกได้ในรูปแบบต่างๆ รวมทั้งการขยายตัวของบทบาทและขนาดของรัฐอย่างมากผ่านรัฐวิสาหกิจ และนโยบายแทรกแซงตลาดแบบต่างๆ (เช่น การคำ้ประกันราคาพืชผล) ทำให้ในระยะสั้น ยังทำให้เศรษฐกิจพอจะขยายตัวไปได้

3. จากสองข้อข้างต้น ทำให้เราผ่านวิกฤติมาได้โดยค่อนข้างง่าย ไม่มีแรงกดดันให้ต้องปฏิรูปขนานใหญ่ใดๆ เอกชนมีการเพิ่มประสิทธิภาพ เพิ่มผลิตภาพน้อย เพราะไม่มีความจำเป็น สังเกตได้จาก Total Factor Productivity ของภาคอุตสาหกรรมที่แทบไม่เพิ่มเลย การลงทุนเพื่อ upgrade productivity มีน้อย แถมการขยายตัวอย่างมากของรัฐ เท่ากับว่าเอาทรัพยากรจำนวนมากไปอยู่ในภาคที่ประสิทธิภาพ และผลิตภาพต่ำ และส่งเสริมให้การคอร์รัปชั่นขยายตัวเต็มที่

4. พอเสถียรภาพค่าเงินกลับมา มีการเกินดุลการค้าและดุลการชำระเงินต่อเนื่อง ค่าเงินย่อมถูกกดดันให้แข็งค่าขึ้น ความได้เปรียบด้านราคาย่อมหมดไป แถมประเทศเกิดใหม่รุ่นใหม่อื่นๆเริ่มมีประสิทธิภาพการแข่งขัน มีผลิตภาพมากขึ้น อุตสาหกรรมส่งออกเราก็เลยเริ่มมีปัญหา ไม่สามารถแข่งขันได้ ในขณะที่หนี้สาธารณะทั้งที่อยู่ในระบบ และที่แอบแฝงอยู่ (เช่น ขาดทุนจำนำข้าว ขาดทุนธนาคารรัฐ ฯลฯ) ก็เริ่มที่จะมีเพดานข้อจำกัด การขยายตัวแบบ"รัฐแอบอัด"ก็เริ่มจะถึงทางตัน

โดยสรุป ....ผมคิดว่า เราเรียนรู้จากวิกฤติ"ต้มยำกุ้ง"น้อยมาก เราแทบไม่ได้ใช้โอกาสจากวิกฤติในการปฏิรูปใดๆเลย สิ่งที่ทำ ก็ดูเหมือนจะเป็นแค่สร้างเสถียรภาพความมั่นคงให้กับสถาบันการเงิน (แต่ก็ด้วยต้นทุนที่สูงลิ่ว) แต่ผลิตภาพที่แท้จริงของระบบเศรษฐกิจดูจะมีเพิ่มน้อยมาก พอปัจจัยต่างๆเริ่มจำกัด เช่น การเข้าสู่สังคมสูงอายุ (แรงงานเริ่มจำกัด) เพดานหนี้เริ่มปริ่มทั้งหนี้รัฐ หนี้เอกชน หนี้ครัวเรือน ฯลฯ เราก็เลยติดกับดักลึกลงไปทุกที

ยี่สิบปีผ่านไปอย่างรวดเร็ว ...แน่นอนครับ เรามีโอกาสน้อยมากที่จะเจอวิกฤติแบบเดิมอีก แต่สิ่งที่น่าจะเจอมากกว่า จะกลายเป็นความหนืด ความอืด ที่เศรษฐกิจจะไม่เติบโต หรือโตช้า ซึ่งหลายคนบอกว่า นั่นอาจจะเป็นเครื่องป้องกันวิกฤติที่ดีได้อย่างหนึ่ง (วิกฤติมักจะตามการเติบโตที่ร้อนแรง) แต่ที่ผมกลัวมากกว่าก็คือ ประวัติศาสตร์สอนว่า ในยามที่เศรษฐกิจโตช้าความเหลื่อมล้ำจะยิ่งทวี (เรื่องนี้ Thomas Picketty ดูจะเขียนไว้ชัดในหนังสือ Capital in 21st century ของเขาว่า ระบบ Capitalism ใน Low growth economy จะค่อยๆ ถ่ายโอนสมบัติจากคนจนไปสู่คนรวย ทำให้ความเหลื่อมล้ำมากขึ้นเรื่อยๆ มันเป็นไปเองตามธรรมชาติของระบบทุนนิยม) ถ้าเป็นอย่างนี้ไปเรื่อยๆ แม้ไม่มีวิกฤติเศรษฐกิจก็อาจมีวิกฤติสังคม ซึ่งถ้าเป็นไปอย่างรุนแรง ก็อาจจะล้มล้างระบบไปเลยอย่างที่เคยเกิดในรัสเซีย จีน เวียตนาม กัมพูชา

ซึ่งถ้าเกิดวิกฤติสังคม เกิดสงครามชนชั้น มีสงครามกลางเมืองขึ้นมาจริง เราคงไม่ได้ฟื้นง่ายๆเหมือนตอนปี 2540 หรอกครับ คงต้องใช้เวลาหลายสิบปีทีเดียว


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          The IMF Advises Banks to Integrate Cryptos into Existing Infrastructure   

A June 2017 staff discussion note from the International Monetary Fund (IMF) suggests that banks should consider investing in cryptocurrencies more seriously than they have in the past. According to the IMF staff team responsible for the note, including prominent economists such as Dong He, Ross Leckow, and Vikram Haksar, “rapid advances in digital technology […]

The post The IMF Advises Banks to Integrate Cryptos into Existing Infrastructure appeared first on The Bitcoin News - Leading Bitcoin and Crypto News since 2012.


          IMF to participate for 'last time' in Greek bailout: Schaeuble   
IMF to participate for 'last time' in Greek bailout: Schaeuble"We have all acknowledged (eurozone and IMF) that the third Greek (bailout) payment will be the last with the participation of the IMF," Wolfgang Schaeuble told Greek daily Ta Nea.
          PUIGDEMONT: "DAMOS MIEDO Y MÁS QUE DAREMOS".   
Rafael del Barco Carreras

Barcelona 2-7-2017. Nos dan miedo a mí y la mayoría absoluta de los catalanes que votamos NO a la Independencia y la Corrupción en las últimas elecciones autonómicas. Nos dan miedo, y 'nos darán más' si consiguen y gobiernan su autoproclamada REPÚBLICA DE CATALUÑA. Una República gobernada por un subvencionado y charlatán ex pseudo periodista, o su colega de aventuras y discurso el historiador profesor Junqueras, que le disputa el liderazgo.

Y al mismo tiempo que los 'alcaldes por la independencia' se reunían en el Paraninfo de la Universidad de Barcelona, en algún lugar o mansión de los Pujol, se discute sobre de dónde salen y cómo se disfrazan los 3 millones de euros para liberar de la pérfida Justicia española a Jordi Pujol Ferrusola. Digo que entre los subvencionados Ómnium Cultural y su hijuela la falsa Asamblea Nacional Catalana, y sus más o menos 30.000 socios o altos cargos públicos catalanes, en reconocimiento al espaldarazo pujolista, podrían aportar 100 euros cada uno y solucionar el dilema.

La 'Fuenteovejuna del independentismo', o el cuento de nunca acabar, o los mejores sueldos de la España política, y de paso el encubrimiento del mayor saqueo sufrido en la Historia de Cataluña. Otro día HISTÓRICO.

”El Estado se da cuenta que esto va en serio, por eso amenazan; pasan de reirse, de la befa a la amenaza, al Estado de amenaza que es la demostración más clara de qué el Estado del miedo que se ha apoderado de los que se pensaban que lo tenían todo controlado”

Su Cataluña repito fue un 'incontrolado estado dentro de otro' desde 1980, y llegado el momento de la Justicia, se excita al núcleo de profesionales pujolistas que consiguieron las SEIS ELECCIONES de Pujol y las dos precarias de ARTUR MÁS.

El 80% de los municipios de Cataluña avalan el referéndum

Un 80% que apenas suma el 43% de la población catalana

en GOOGLE

Noticias destacadas



El Periódico · Hace 1 hora

Periodista Digital · Hace 13 hor

LA SECESIONISTA TV3

Més de 500 alcaldes donen suport a l'1-O

El paranimf de la Universitat de Barcelona acull l'acte de suport dels municipis al referèndum
          7/3/2017: BUSINESS: IMF pays for ‘last time’ into bailout of Greece   

THE International Monetary Fund, a key creditor in Greece’s bailout, will not participate in any further rescues of the debtwracked country, Germany’s finance minister told a Greek newspaper on Saturday. “We have all acknowledged [eurozone and IMF]...
          ASPERSIONS ON THE US$2.25 BILLION OF DOMESTIC CEDI DENOMINATED BONDS ISSUED BY THE GOVERNMENT OF GHANA   

1.         The attention of the Ministry of Finance has been drawn to a statement issued by the Minority in Parliament which seeks to cast negative aspersions on the 9.7 billion cedis (USD2.25 BILLION) domestic bond issue of the Government of Ghana.
 
2.         The Ministry considers the statement as unfortunate especially as it was fronted by Hon Cassiel Ato Forson, a former Deputy Finance Minister, who knows very well the workings and processes for the issue of domestic bonds and as such, should not be making such baseless allegations. As such, the Ministry has no choice but to surmise that these allegations are maliciously designed to malign and negate the positive news and rave reviews this landmark transaction has garnered, both locally and internationally.
 
3.         The Minority statement sets out three (3) major claims which the Ministry will like to clear.
 
(a)        That the issuance was shrouded in secrecy to the extent that other investors were denied the opportunity to participate in the transaction.
 
(b)        The transaction was “cooked” to favor a particular investor (Franklin Templeton (FT) just because a director of one of the funds FT manages,
knows the Finance Minister; and
 
(c)        The transaction should have received Parliamentary approval because it technically should be considered to be a dollar denominated sovereign bond issue due to the level of foreign investor participation and that, in the view of the Minority, it amounted to a private placement
 
Response
To the aforementioned claims, the Ministry responds as follows:
1.         The issuance was not shrouded in secrecy nor was it “cooked” for any particular investor.  The Bookrunners, (Barclays, Stanbic and SAS), on behalf of the Ministry of Finance have been mandated since 2015 to issue these domestic bonds on a regular basis as per the debt issuance calendar which Ministry of Finance (MoF) puts out every quarter. Also the book runners announce and publish every impending bond issue to the market, the week of issue and provide price guidance to the market. This particular bond issue was no different and was done in conformity with the established process. It was announced by the Book Runners to the market on March 30, via email and same published on MoF and Bank of Ghana (BoG) websites with settlement on April 3. FT was not the only participant, there were over 25 other buyers including other foreign entities, who all brought in dollars to convert to cedis to buy the bonds.
 
2.         This bond issue, like all the others done prior could not have been designed to favour any single investor. The conventional processes for the issue of bonds using the book building approach were adhered to in this particular issuance. It is our understanding that the said investor engaged various market participants and other key institutions including the IMF before deciding to participate in the bonds. It is worth noting that local investors also participated. The said investor participated in the issuance in the manner they have always done since 2006 through their local Primary Dealer, Barclays Bank and their local custodians, Standard Chartered Bank and Stanbic Bank. To have obtained preferential treatment, all the above mentioned institutions would have had to conspire to do so, a situation which is unfathomable.  The investor in question, FT, has held Government of Ghana bonds of up to USD 2 Billion prior to this transaction. Indeed FT has been buying and investing in government bonds since 2006.
 
3.         This issuance, like all other domestic bonds issued under this bond program since 2015, did not require Parliamentary approval. Approval was given under the initial application to Parliament in the 2015 Budget Statement and Economic Policy document, to run such a bond issuance program.  The Ministry of Finance has the mandate to fund the deficit as contained in the budget approved by Parliament through the issuance of debt instruments and to manage the countries debt stock
 
Impact of this Transaction
The issuance brought in significant amount of foreign currency, which was converted into cedis to purchase the bond, helping to strengthen the value of the Cedi and providing much-needed respite for the citizens of Ghana
 
The transaction will also lengthen the maturity periods of government debts thereby reducing the short term redemption and rollover pressures on government.
 
The proceeds from the bond issue are to be used for liability management and for the re-profiling of our domestic debt stock by repaying more expensive short-term debt as it matures, as such it shall not add to the total debt stock of the nation.
 
This deal is a positive move in the current debt management strategy being pursued by government and should be applauded.
 
Conclusion
The Ministry hereby informs the general public to disregard these allegations as they are unfounded and malicious and seek to undermine the credibility and integrity of your Government.
 
(Signed)
ISSUED BY THE PUBLIC RELATIONS UNIT
MINISTRY OF FINANCE


          HON. KEN OFORI-ATTA LEADS GOVERNMENT DELEGATION TO THE 2017 IMF/WORLD BANK SPRING MEETINGS IN WASHINGTON DC, USA   

April 19, 2017    The Chairman of the Economic Management Team, Vice President Dr. Mahamudu Bawumia, and the Finance Minister Ken Ofori-Atta are leading a Government delegation to the IMF/World Bank Spring Meetings to be held in Washington DC, from April 18 – 28, 2017.
 
2.         The delegation is made up of officials from the Bank of Ghana, led by the Governor, Dr. Ernest Kwamina Yedu Addison; the Chairman of the Finance Committee in Parliament, Dr. Mark Assibey Yeboah (MP); and officials from the Finance Ministry.
 
3.         Whilst there, the delegation will meet with  the World Bank President, Jim Yong Kim, as well as the IMF Managing Director, Christian Lagarde. They would also attend the African Consultative Group Meetings with Christian Lagarde and President Jim Yong Kim.
 
4.         A major highlight for the delegation is the Center for Strategic and International Studies, “Spotlight on Ghana” event, a spotlight event being organized for Ghana to examine the major political and economic trends in Ghana as the new Government charts its course.
 
5.         The Ghana event will bring together policy makers, business leaders, country analysts, opinion leaders from Ghana, the United States and beyond, to discuss Ghana's prospects for economic recovery, explore issues of governance and regional leadership and examine the multiple strands on US policy engagement.
 
6.         Other meetings the delegation would attend, include the G24 Deputies Meetings and the African Caucus Bureau. The G24 Ministerial Meeting provides an opportunity for the G24 member countries to consider key areas in which international Financial Institutions and multilateral actions can effectively complement and support their policy efforts. 
 
7.         The delegation will also hold investor related meetings with holders of Ghana’s Bonds as well as institutional investors. These meetings provide an opportunity for the delegation to highlight Government’s economic policies and strategies as well as investment opportunities in Ghana.
 
8.         Also on the agenda are meetings with Senior Executives of ratings agencies: Standard and Poors, Fitch, and Moodys. These meetings present a window of opportunity to re-emphasize government's policies and strategies in solving macroeconomic imbalances as well as strategies to ensuring debt sustainability.
 
9.         Aside the obligatory meetings with the IMF and the World Bank, the delegation will hold bilateral discussions with other partner countries, financial institutions and private sector investors.
 
About the Spring Meetings
10.       Each spring, thousands of government officials, journalists, civil society organizations, and participants from the academia and private sectors, gather in Washington DC for the Spring Meetings of the World Bank Group and the International Monetary Fund. Seminars, regional briefings, press conferences, and many other events focused on the global economy, international development, and the world's financial markets are held. END
 
(Signed)
ISSUED BY THE PUBLIC RELATIONS UNIT
MINISTRY OF FINANCE 


          Comment on Revealed: IMF Has Granted Themselves Complete Immunity From Any Form of Legal Prosecution or Taxation by Cheryl D Donka   
How many organizations are trying to rule us? No immunity for foreign politics.
          Comment on Revealed: IMF Has Granted Themselves Complete Immunity From Any Form of Legal Prosecution or Taxation by Michael Colvard   
Never
          IMF warns Barbados: Expect higher cost of living   

BRIDGETOWN, Barbados

And the Washington-based financial body says the recent Budget in which Finance Minister Chris Sinckler announced a 400 per cent increase in the National Social Responsibility Levy (NSRL), the introduction of a two per cent levy on foreign exchange, and a hike in the excise tax on gasoline and diesel is directly to blame.

It said that inflation, which stood at 3.2 per cent at the end of last year, is expected to more than double by the end of 2017.

“Inflation is expected to continue to accelerate to 6.7 per cent by year end because of the increase in the National Social Responsibility Levy (NSRL) and other taxes and fees, but revert to more historical norm in 2018 and subsequent years,” it said in its statement, following just concluded talks.

“Growth in 2017 is projected to slow to less than one per cent, reflecting the fiscal consolidation efforts introduced in the FY2017/18 Budget.”

The IMF team was here from June 20 until yesterday, at the request of the government to review recent economic developments and discuss the 2017 budget, and was led by the fund’s deputy division chief for the Western Hemisphere Judith Gold.

The Freundel Stuart administration has remained adamant that it will not seek to enter an IMF programme, despite recent warnings from noted economists that it could not fix the ailing economy on its own.

Former Prime Minister Owen Arthur, backed by several other respected economists, have sounded the alarm that Sinckler’s half-billion-dollar adjustment programme would effectively trigger a devaluation of the Barbados dollar, and that an IMF adjustment would have been far easier for the entire country to swallow.

However, with Government currently sticking to its homegrown strategy, the IMF advised the country that continued fiscal discipline with economic growth would be essential to securing Barbados’ future.

It warned that over the medium-term, further fiscal adjustment would be needed on the expenditure side to decisively reduce its debt and debt service costs.

“Transfers to public enterprises of close to eight per cent on an annual basis represent the second largest expenditure item, after the wage bill, and about the same magnitude as the interest bill on the public debt.

“Both expenditure categories weigh heavily on public finances and critical reforms are needed over the to restore sustainability and confidence,” the IMF said, adding that a reduction in transfers to public enterprises must be supported by structural reforms to reduce state agencies’ operating costs, rationalize their programmes, and raise their revenues.

The IMF also urged Barbados to be mindful of possible external shocks as Britain continues its exit from the European Union.

“There are important downside risks related to the increase in domestic and global uncertainty, including the impact of the Brexit on the British pound,” the IMF said.

It stressed that while the Barbadian economy continues its recovery on the back of stronger tourism performance, improving public finances remains a critical challenge.

 

Read more: http://www.caribbean360.com/news/imf-warning-barbadians-told-expect-incr...


          "Watch for it" - Sun. PM KTFA Thoughts/News   
KTFA

MilitiaMan » July 2nd, 2017

I like that they have updated the site 07/02/2017. Notice how easy it will be to calculate the numbers when they drop the zeros.. Hmm https://cbi.iq/news/view/235

Don961 » July 2nd, 2017

Iraqi Federal Police parade, dance in streets of west Mosul

By Rudaw 45 minutes ago (video in link)

MOSUL, Iraq – Iraqi Federal Police paraded and danced in the streets of west Mosul on Sunday. With the city largely under Iraqi control, security forces face the task of clearing many bombs and explosives left behind by ISIS.

“In the battle for Mosul, we have destroyed the barriers that ISIS worked on for two years. ISIS dug many trenches and planted many bombs. Thanks be to God we have removed all of these barriers and the city is returned to its people. We have promised the people and now we are declaring this good news to the people of Mosul, to you, and to all the people of Kurdistan as well. Returning Mosul to its own people is our Eid,” Colonel Rahim, head of the federal police bomb disposal squad, declared.

Final victory in the city has not been declared, yet. “ISIS is remaining in some alleys of Old Mosul, but we can say that the entire Old Mosul has been retaken,” noted Colonel Hamid Hussein, commander of the Rapid Response Force.

The celebration, however, brought a rare smile to the citizens of Mosul. Many children joined in the fun, dancing with soldiers in the streets.

( Raucous video in link )

The task now facing Iraqi security forces is to clear the streets, alleys, and houses of explosives. ISIS has often rigged booby traps as one of its tactics.

“Now we are investigating the districts in Old Mosul to remove the bombs,” said Karim Lami, a commander in the federal police, told Rudaw. He added that they had retaken Sanjkhana neighbourhood.

“There are many bombs in the districts of Mosul. We will remove all of them in a short time, God willing. In order to defuse them quickly, we ask people to inform us if they find any bombs,” said Colonel Rahim.

The Mosul offensive began on October 17, 2016. Iraqi security forces, Kurdish Peshmerga, Hashd al-Shaabi fighters, and the US-led international coalition to defeat ISIS joined forces to defeat ISIS in the city.

http://www.rudaw.net/english/middleeast/iraq/020720172

Aggiedad77 » July 2nd, 2017

FRANK.....WOW.......ALAK has been listening to your CC's or taking our notes.....

The first paragraph indicates many things you have already covered that would be happening.....inflation under 2%.....maintaining a fixed exchange rate.....exceeding IMF reserve forecasts.....working on non-oil revenue increases......tightening of borders......you've talked of all these things recently.....and done so pointing out they are of high interest to the IMF......

Kudos to you and TEAMS for the monumental efforts.....proof positive here IMO that we are on the right track.....it's coming.....watch for it......that is....the BEST is coming...IMO. Aloha Randy

Don961 » July 2nd, 2017

Keywords «morning»: our economy overcome the difficult phase

07/03/2017 0:00

It revealed that the central bank reserves exceeded the expectations of the IMF $ 10 billion

Baghdad / Tariq al - Araji

The central bank confirmed that Iraq has overcome the difficult phase «pessimistic» that have passed over the past two years, which were accompanied by statements are not based on facts raised in horror Iraqi street.

Showed the bank , which is the «safety valve» for the economy and monetary policy of the country indicators, the inflation rate did not exceed 2 percent, while kept the dinar on a fixed exchange rate, in addition to the index raised interest in supporting global institutions as exceeded the central bank reserves ceiling IMF forecasts ten billion dollars , despite the extraordinary circumstance that is going through the country, but despite the relative recovery of the Iraqi economy, the central bank governor on the Keywords called on the government to rely more on revenue (non - oil), venerating and lack of dependence on oil in this large proportion in the budgets, also stressed the need to take Government planning its sound financial and economic revitalization and development of the private sector and encourage investment and to stop the dumping policy of the country and the improvement of the domestic industry and stop the chaos at the border crossing points.

Keywords and as usual , to talk clearly fully and explicitly, revealed in his interview with «morning», that an important meeting will be held with the International Monetary Fund in the month of August and will be based on the reimbursement of Iraq Fund grants and loans agreed the launch of the requirements of them after submission (supplementary budget) to pay the dues of peasants contractors and suppliers , and several sections of other expenses.

Keywords also pointed out that the central bank has made significant progress over the past two years regarding the fight against money laundering and the financing of terrorism and the smuggling of foreign currency procedures, stressing oblige the bank to banks relevant to take inter action in this regard, as well as cooperation with international institutions and financial institutions led to the conversion of many of the money - laundering and the financing of files terrorism to justice the first time.

The following is the text of the meeting: overcome the difficult stage

* What is your calendar 's financial and economic situation of Iraq and presented by the Bank in this regard?

* If we want to measure the strength of the economic and financial country; it must be considered to economic, financial and monetary policy factors, the monetary situation is a reflection of the economic situation, and if we consider the economic situation of the country, you have to look at the real factors to the development of real Kalsnaaah, agricultural and other sectors especially the case General monetary reflection of the state and not of origin.

As for the economic situation in Iraq; many of the analyzes and statements released pessimistic statements are not based on facts, as this speech at the beginning of last year , 2016 through the threat of the collapse of the dinar, to finish to overcome the difficult conditions that accompanied the decline in oil prices and the situation experienced by the country in the war against terrorism, as the cash reserve exceeded the central bank's forecast of the international Monetary Fund with ten billion dollars, and kept the exchange rate on the stability, and did not extend past the level of inflation barrier of 2 percent, and this is a very important indicators of the world understood by international institutions accredited and enjoys the status of a task in the calendar Oaudha Countries and the strength and stiffness of their economies to face conditions and shocks and risks;

but - with very Alosv- many in Iraq do not see it the same degree of importance or neutral and carefully when evaluating the economic situation. The previous risk has become at present (non - existent), but I do not say that the difficulties and challenges ended, and the role of the central bank is trying to push these challenges and reduce their impact on the economic situation; however , the first line of defense remains the responsibility of the executive branch ( the government) with regard to the proper planning financial and economic revitalization and development of the private sector and encourage investment and to stop the dumping policy of the country and the improvement of the domestic industry and stop the chaos at the border crossing points,

it is strange to turn attention towards the central bank , who is dealing as valve Aman- to take this role because of the weakness of all the episodes that we have quoted wa T should be corrected, it has the central bank introduced by the end of 2015 and 2016 (about twenty trillion dinars) to support the Treasury and the payment of salaries, and should not rely on it in the future, and have the central bank since the duration of the process of pushing the government towards that there will be control over their expenditures and adapt to these challenges and that a new plan of the financial situation based on reliance on revenues placed (non - oil) and not to rely on this oil ratio large. International grants and loans

* What is the extent of coordination with the IMF and the World Bank to launch grants and loans to Iraq? And the extent of Iraq 's commitment to Ptosyatema economic and monetary reform?

* The meetings with the International Monetary Fund periodically based on the agreement (credit recovery) signed by Iraq with the Fund, and are reviewed on things that have been agreed upon, as well as economic, financial and monetary framework of the country, because the support and facilities the process provided by the Fund and thus inflicted the World Bank and other countries involved in this Thread depends primarily on the reports provided by the international Monetary Fund, and the importance of those reports and audits carried out by the Fund is not only related to it; but is the way to give the green light to financial institutions and other countries to provide support and grants based on the Positive reports it provides, such reports In order to be positive must show his commitment to Iraq ( to maximize revenue and reduce unnecessary expenditures), and therefore considered the review with useful Fund for Iraq as it is a lot of style trends in spending.

At the last meeting was at the International Monetary Fund, observations on compliance with assignments due in the general budget of the state and the presence of Diffraction them sometimes, and we have explained to them that Iraq -obgm is relatively stable conditions experienced Bha- can not adjust melodious it because of a lot of variables and conditions , and having understood it demanded that there be a legal cover for these emerging changes, so the basic requirements for the international Fund before the meeting to be held early next August , whichever is an important meeting for Iraq to be able to receive payments Kadmh- is a request for ( a supplementary budget )

It is fall within what the Iraq at the time of the payment of contractors, farmers, processors and other receivables do not exist within the (federal budget) and indicated IMF requirements in this area to the article says (in case it is needed to prepare the budget complementary to the implementation of the payment of dues; for the government provides a supplementary budget for the development of a legal cover for the payment of these receivables as well as make some adjustments based on the change that took place on oil prices or because of the increase in some expenses existing) and the objective of the IMF from these observations is to be retained on the ceilings specified for the expenses and revenue . Iraq 's financial rating

* How do you evaluate coordination with the Organization (Financial Action Task Force)? What is the classification of financially Iraq according to this organization?

* The Organization (Financial Action Task Force) on measuring the extent of the obligation of States to fight money laundering and the financing of terrorism, and Iraq has cut off whatever it way, after that there were observations and a report prepared by the end of 2012 was alarming, and it was Iraq and the jurisprudence threatened to put in (blacklist) , after efforts and through the issuance of a new law to combat money laundering and activate the anti - money Laundering Office by the Central Bank and the inter measures taken by the Bank as part of a follow - up to the banks and financial Institutions

and the development of many of the procedures relating to regulation and control over the financial and banking sector in particular, could not that Iraq is out of danger after it was heading from the (gray area) to (black), but we have moved from (gray) to (follow - up area) and we now expect to build on fulfill Iraq's requirements of the organization and the obligations that come out of the subject (follow - up). Anti - Money Laundering

* What are the mechanisms used by the central bank to control money laundering and currency smuggling operations difficult?

* The foreign currency movement abroad issue requires to be placed in the correct and regulatory standards enable the central bank to achieve its foundation the judge to verify the legality of the money and it is not linked to financial crimes or money laundering offenses or the financing of terrorism, and the role played by the central bank, especially in recent years , as the granting of this subject and developed great attention from the regulatory mechanisms in this direction by forcing banks to follow the rules and procedures associated with the law of anti - money laundering and the financing of terrorism committed by banks and financial institutions

to take a number of due diligence measures towards the knowledge of the customer and with FH money sources and movement and, accordingly; the Central Bank - the first time - requires banks to establish special anti - money laundering units to manage compliance and risk management and the development of programs and database and information relating to all operations carried out by banks and units, and this is part of the process of anti - money laundering and the financing of terrorism.

There are other parts are outside the frameworks of the Central Bank requires the concerted and other efforts of institutions in dealing with them, because financial institutions or banks is a ring of the rings may be the last, especially since the money and financial crimes laundering operations are operations precede the entry of money to the bank and operations bleaching complex processes go through several stages , and is taking the proceeds of these crimes is not deposited the bank directly understand they have various means and methods of multiple waste out of this money, and a lot of money suspicious go towards the purchase of real estate or gold , or set up fake companies or interfaces and then record the proceeds of these companies Connect this money.

Therefore; the fight against money laundering and the financing of terrorism requires the cooperation of all parties and linking all professions Steering supervised and that what the Bank is yet to arrange the banking sector house by obliging them a set of rules and procedures and formations we have to link selling the dollar process of the level of commitment to this procedures and criteria established in front of banks to enter the window to buy the dollar and leading us as a central bank to exercise a supervisory role, and now the banks a set of procedures for verifying the integrity of money and open files to customers dealers by the level of income and provide the bank with Final statements correspondent banks abroad to know the fate of the money and where you went. Judicial files

* Is there coordination with international organizations and banks to control the movement of money and reduce the phenomenon of money laundering?

* Yes , there is cooperation now between the central bank and organizations , central banks in several countries and there are an exchange of information, because the movement of funds reflected in the result system or device on the operations of the conversion, if the conversion dollar operations read all of it passes through the US Federal Bank and through a particular system can the US Treasury to know each movement of the movements of the money, so we share the information has been a lot of transactions involving suspicions, especially with regard to the financing of terrorism and has referred to the elimination of the diagnosis, and these efforts have been activated in the last two years and there were no issues have stirred the The judiciary entitled (money) laundering in the past.

The central bank needed to the role and cooperation of other institutions to activate this activity, especially the Office of the (anti - money laundering) of the Bank does not conduct inspections directly, but called to inform the Office receives communications from other parties, if there were processes of corruption must be our notice by the authorities involved in combating corruption, and if there are operations relating to the financing of terrorism must be reported movement of terrorists and the movement of money and their areas by the security services; and so on , but the central bank and through the transactions carried out by banks and the operations of the conversion can put some doubts and suspicions and begin operations t Qiq related information, but the main source of these remain outside the bank , and this is still weak.

http://www.alsabaah.iq/ArticleShow.aspx?ID=139934

          Official Coordination or Is the Market Getting Ahead of Itself?   
Here are the data points that the consensus narrative connects.  The BIS encourages countries not to dawdle and remove accommodation when appropriate. The Bank of Canada indicated that after several quarters of strong economic expansion and robust labor market growth, it is time to re-think its monetary stance. 

In a close (5-3) vote, the Bank of England left rates on hold in June, and Governor Carney who had forcefully argued against raising rates seemed more open.  It has removed some accommodation provided after last year's referendum through raising the capital buffer. 

The ECB has been gradually evolving its risk assessment and forward guidance.  The downside risks to growth have dissipated, it says, and the threat of deflation has been turned back. Many understood Draghi to have also indicated readiness to begin removing accommodation.   There is a coordinated effort underway to take away the proverbial punch bowl.

Two major central banks meet in the week ahead.  Both the Reserve Bank of Australia and Sweden's  Riksbank are likely to also tilt their neutral stance toward a little less accommodation.  Through statement rather than deeds, the respective monetary authorities can downplay the likelihood that economic conditions will warrant further easing.  

This may have more market impact in Australia, where there are some lingering ideas that rates may still be cut, and the Australian dollar is trading at the upper end of a year-old trading range.  In fact, as the first half ended, the Australian dollar is flirting with a trend line drawn off the April and November 2016 spike highs and the highs from March this year.  It is found near $0.7725. 

The euro's price action had traced out some kind of topping pattern against the Swedish krone. Whether it is a triple top or a head and shoulders pattern, the neckline ( ~SEK9.70) broke dramatically, and the initial target near SEK9.60 was approached before the weekend.   It also corresponds to a 50% retracement of this year's euro rally.  The next target is in the SEK9.50-SEK9.55 area.  

Ironically, the only major central bank that the market is skeptical about seems to be the Federal Reserve.  The troika of leaders (Yellen, Fischer, and Dudley) as well as a couple of regional Fed Presidents not only want to press ahead with the course, and added to their arguments a discussion about financial conditions and rich equity valuations.   Depending on one's assumptions, the Fed funds futures strip implies around a 15% chance of a hike in September and around a 45% chance of a hike.  

The story that is spun suggests that officials everywhere are telling investors that the gig is up, that peak QE is behind us and a new monetary cycle is at hand.  We are skeptical and suspect that the narrative is getting ahead of itself.  The Vice President of the ECB quickly tried to explain that Draghi was not announcing a change in policy.  

Draghi had, we thought, been clear that the preconditions of removing accommodation, namely a durable and sustainable increase of inflation, had still not been achieved.   Even before last week's comments, we anticipated that in September, the ECB would likely announce an extension of its asset purchases into the first half of 2018 albeit at a reduced pace.  Draghi also seemed clear that he was opposed to lifting the deposit rate before the asset purchases were complete. 

Nor did Carney flip-flop from the Mansion House Speech.  He outlined his considerations if monetary accommodation should be removed.  It seems clear from Carney's comments that those considerations would not be addressed in weeks but months.  

If the market ran on what it thought it heard, the economic data due out in the coming days might provide a reality check.  The final eurozone PMIs will likely confirm the moderation seen in the flash reading.  Germany and Spain will likely report a decline in May industrial output. Unemployment in the region is expected to have steadied at 9.3% in May.  It is down from 10.2% in May 2016, but it is still not at politically acceptable levels.  Retail sales are expected to have decelerated to a 2.3% year-over-year pace from 2.5% in April.  It would be the slowest pace in three months.  

The UK June PMIs are expected to have softened.  It would be the second consecutive decline. The composite average in Q2 is unlikely to show improvement from Q1, suggesting growth is still around a 0.2%-0.3% pace.  While median forecasts call for an increase in industrial production and manufacturing output, it appears to come at the cost of a deterioration in the trade balance.  

The sell-off in European bonds dragged US bonds lower, but premium the US offered narrowed.  The US 10-year premium over Germany, for example, narrowed 16 bp last week to nearly 180 bp; the smallest premium since last November.  It peaked near 235 bp late last year.  The US two-year premium slipped only a single basis point last week, but in the three-week slide, the premium has narrowed by 11 bp.  The two-year premium peaked near 222 bp in early March, and since then has found a base near 192 in each month (April, May, and now June).  

We suspect that officials in Europe will be more likely to protest a premature backing up of interest rates than US officials.  This taper tantrum began in Europe.  They will likely want to prevent it from getting out of hand.  The data highlight of the holiday-shortened US week is the employment data, and a bounce back after a soft May report is expected.  Non-farm payrolls are expected to have expanded by around 175k-180k in June, with a 0.3% increase in average hourly earnings.  The unemployment rate has fallen from 4.8% in January to 4.3% in May, where it likely remained.  The underemployment rate (U-6) fell from 9.4% in January to 8.4% in May.  It too is not expected to have changed in June.  

Central bankers, especially the Americans, are convinced that some Phillip's Curve is at work,  whereby higher labor costs (spurred by demand relative to supply) are passed along to customers through higher prices.  As long as slack in the labor market is being absorbed, many Fed officials will be confident that, at some point, wages will rise, and there will be an increase in the general price level (inflation).  

However, before getting to the jobs report, there will be other data that will likely play on investor concerns about the trajectory of the economy and prices.  Even if the manufacturing ISM picks up as suggested by the various Fed manufacturing surveys and the Chicago PMI reported before the weekend, prices are likely to have softened.  Price paid may have fallen for the third month.  

Softer goods prices would be acceptable, perhaps, if it was associated with an increase in demand. However, the continued gradually slowing in auto sales warns of a headwind on retail sales. If the median expectation that the US bought cars and light vehicles at a 16.5 mln unit pace in June, then it will mark the slowest quarter since Q1 14.  
The Bank of Japan has not discussed its exit strategy.  Some have argued that by shifting policy toward targeting the 10-year yield, which requires the purchase of fewer JGBs, that the BOJ has already begun tapering.  We do not think this is a fair assessment, and it is one that the BOJ itself rejects.  The sell-off in European bonds spurred a global move and the JGB was not immune.  We expect a robust defense by the BOJ.    

While we suspect the eurozone economy is more likely to moderate than accelerate, the Japanese economy is accelerating.  The Tankan Survey kicks off the quarter and improvement is expected across the board, including a healthy jump in capex plans, which are expected to be the strongest in a year and a half.   Japan's Composite PMI stood at its highest level in at least three years in May.  It may be little changed in June.   The resounding defeat of the LDP in the Tokyo election prompt another supplemental budget. With numerous accusations of improprieties and favoritism, Prime Minister Abe may find his political agenda challenged, even as there appear no alternative to Abenomics.  

The Bank of Canada has unambiguously warned the market that it is considering raising rates. The market believes it.  The OIS appears to have discounted an 80%-85% chance that a 25 bp hike will be delivered on July 12.  Canada reports both jobs and trade in the week ahead.  Theoretically, they have the ability to disrupted official plans, but most likely they won't.  

Job growth has been sizzling.  Canada has generated 316.8k jobs over the past 12 months, and a solid two-thirds have been full-time positions.  Wages have firmed recently.  For the past three-quarters, the economy has grown around 3.5% and appears off to a solid start in Q2. Canada's trade balance has improved, helped by a recovery in non-energy exports.  The impact of the softwood lumber duties will be of interest.  How much was volume impacted or how much simply meant US consumers paid a higher price?

For two month's the euro has alternated between weekly gains and losses.  In the saw-tooth pattern the weekly advances have been larger than the weekly losses; hence the uptrend.  If the pattern is to remain intact, it will be a down week for the euro, which is consistent with a further clarification by the ECB and soft economic data in the EMU (and the UK).  We expect the market to turn cautious ahead of $1.15.   

Sterling has advanced for eight consecutive sessions.  It is the longest streak in two years.  It has approached an important technical area that kept the May rally in check ($1.3055).  A push above this level early in the week ahead could be similar to the end of a boxer's punch, as opposed to a sustained breakout, especially if the fundamental data suggest Carney's caution will continue to prevail.  

With the BOJ lagging behind the other central banks, short yen cross positions have been in momentum and carry buckets.  The dollar's weekly close above JPY112.00 was a constructive price development.  A downtrend line from the year's high intersects at the end of next week near JPY112.50.  A break of this would further lift the tone.  On the downside, the JPY111.20-70 offers an initial base.  

There are events next week that may be under-appreciated.  The first is that Japan and the EU are getting very close to a trade agreement.  In fact, the July 6 summit is likely to produce a political agreement to remove all customs duties in the bilateral trade.  The deal, according to estimates, could triple EU agriculture exports to Japan, and increase overall EU exports by a third.  

Next week concludes with the G20 meeting in Hamburg Germany on July 7-8.  The theme is a fair and free trade.  It will be one of the more difficult summits to paper over the distinct tensions as is the usual fare. There are broad tensions with the United States.  The withdrawal from the TPP and the Paris Accords, the sanctions that threaten the Nord Stream 2 pipeline, the reported requests for unilateral concessions from some Asian trading partners, supporting Le Pen in France, and the threat to put a tariff on steel imports are all flash points.  

The inability to distinguish a squabble among friends and allies with strategic disputes with adversaries risks raising trade tensions and isolating America at a time when international cooperation is sought on a wide range of issues, including fighting terrorism and reining in North Korea.  This could have a longer-term impact on the dollar, and underpin the underlying desire for an alternative, for which we would continue to argue that there is no compelling candidate. 


However, the key to the dollar's performance in the time frame that matters to most investors lies with cyclical considerations and the US economic and monetary policy. The debate within the Republican Party, which has a majority in both chambers, has paralyzed the legislative process, creating the famed gridlock, in a similar but different way that as the inter-party rivalry has sometimes fostered. The lack of convincing legislative progress on healthcare, for which the opposition to the Affordable Care Act was most united, raises questions about the broader economic agenda, and recently prompted the IMF t o revise down its growth outlook for the US.   






Disclaimer






          บรรยง พงษ์พานิช: วิกฤติต้มยำกุ้ง2540 ยี่สิบปีแล้ว เราเรียนรู้อะไรกับมันบ้างนะ   


 

ในวันนี้เมื่อยี่สิบปีก่อน ....2 กรกฎาคม 2540 ตั้งแต่ธนาคารแห่งประเทศไทยเรียกประชุมนายธนาคารทุกแห่งในเวลาเช้าตรู่เวลา 7.00 น. แล้วประกาศว่า ประเทศไทยจะใช้ระบบอัตราแลกเปลี่ยนเงินตราต่างประเทศแบบลอยตัว ให้เป็นไปตามกลไกตลาด ซึ่งหมายความว่า ธปท.จะไม่เป็นผู้กำหนดและจะไม่แทรกแซงขนาดหนักอย่างที่เคยทำมา (ซึ่งทุกคนก็รู้โดยทันทีเลยว่า ธปท.สารภาพว่าเงินทุนสำรองหมดเก๊ะแล้ว ไม่มีเค้าจะแทรกแซงได้อีก) ...และนั่นก็เท่ากับการประกาศจุดเริ่มต้นอย่างเป็นทางการของ"วิกฤติเศรษฐกิจ"ครั้งยิ่งใหญ่ที่สุดที่ประเทศไทยเคยมี ที่เราเรียกกันว่า"วิกฤติต้มยำกุ้ง" ซึ่งในที่สุดก็ลุกลามไปทั่วทั้งภูมิภาค มี Kimchi Crisis ของเกาหลี Abodo Crisis ของฟิลิปปินส์ Gado Gado Crisis ของอินโดนีเชียและNasi Lemak Crisis ของมาเลเซียทยอยตามมาติดๆ

ผมว่าการที่ใช้อาหารประจำชาติมาตั้งฉายาให้วิกฤติเศรษฐกิจที่ลุกลามในครั้งนั้นเป็นเรื่องที่เหมาะมากทีเดียว เพราะการลุกลามนั้นไม่ใช่เป็นการติดเชื้อโรคเท่านั้น แต่เพราะสาเหตุที่แท้จริงนั้นมันเป็นเพราะต่างก็กินอาหารแสลงเหมือนๆกัน นั่นก็คือการลงทุนที่ผิดพลาด (ลงในสิ่งที่มีผลตอบแทนไม่คุ้มค่า) และใช้แหล่งเงินทุนที่ผิดพลาด (เอาเงินกู้ระยะสั้นสกุลต่างประเทศมาลงทุนระยะยาว)

สาเหตุความเป็นไปวิธีการแก้ปัญหารวมทั้งเหตุการณ์ต่อเนื่องจากวิกฤติครั้งนั้น ผมได้เคยเขียนบรรยายรายละเอียดไว้แล้วในบทความยาว 8 ตอน ที่เขียนเมื่อ 2 กค. 2556 - 18 กค.2556 ใครสนใจไปหาอ่านได้ใน ThaiPublica นะครับ ....วันนี้จะพูดถึงบทเรียนที่ได้กับผลจากการแก้ปัญหาและอุทธาหรณ์อื่นๆ

การแก้ปัญหาวิกฤติครั้งนั้นของแต่ละประเทศนั้นแตกต่างกัน ไทย อินโดนีเซีย และเกาหลีใต้ ต่างก็ขอเข้ารับความช่วยเหลือจาก IMF ขอเงินกู้ ($ 17, $42 และ $58 พันล้าน ตามลำดับ) โดยยอมตัวเข้าผูกพันตามโครงการปฏิรูปภายใต้บันทึกข้อตกลง (LOI) ขณะที่ฟิลิปปินส์มีปัญหาไม่มากนัก เงินสำรองมีมากและดุลการค้าก็ได้เปรียบ ถึงแม้ค่าเงินจะลดลงมาก แต่เศรษฐกิจก็ถดถอยเพียงเล็กน้อย(ตำ่กว่า 5% ขณะที่ประเทศอื่นๆมากกว่า10%) ฟิลิปปินส์จึงใช้แค่Technical Assistance คำปรึกษาจาก IMF โดยไม่ต้องขอกู้ ...ส่วนมาเลเซียของคุณพี่มหาเด่ร์นั้นไปอีกแนว ประกาศไม่เอา IMF แถมด่ารายวัน (แหะๆ...จริงๆไม่ใช่รายวันแบบแถวทำเนียบเรานะครับ เป็นแค่ประมาณเดือนละครั้ง) แล้วก็มีการควบคุมการไหลเข้าออกของทุน (Capital Control) แถมกำหนดอัตราแลกเปลี่ยนตายตัว(Fixed Exchange Rate) กึ่งๆปิดประเทศบางส่วน อาศัยว่ามีเงินทุนสำรองค่อนข้างมาก กับราคาน้ำมันซึ่งเป็นสินค้าส่งออกหลักอันหนึ่งปรับตัวดีขึ้นก็เลยรอดตัวพัฒนามาได้

วันนี้วิกฤติผ่านมายี่สิบปีเต็ม ต้องบอกว่าทุกประเทศต่างก็ผ่านวิกฤติมาได้ หลังจากที่ต่างก็ชะงักงันเศรษฐกิจติดลบไปแค่ปีสองปี ในที่สุดก็ตั้งหลักเดินต่อกันได้ ซึ่งแทบทุกประเทศกลับมามีอัตราเติบโตได้ดีซึ่งถ้านับจากปี คศ.2000 ที่ต่างก็ตั้งหลักกันได้จนถึง คศ.2016 ส่วนใหญ่สามารถกลับมาเติบโตในอัตราที่น่าพอใจ ...ฟิลิปปินส์ เติบโตได้เฉลี่ย 4.95% ต่อปี ...ขณะที่อินโดนีเซีย ก็พัฒนาได้ดี เศรษฐกิจเติบโตเฉลี่ยได้สูงถึง 5.3% ต่อปีแถมประชาธิปไตยเบ่งบาน เผด็จการถูกโค่นล้ม ธรรมาภิบาลก็พัฒนา คนโกงโดนลงโทษ ดัชนีคอร์รัปชั่นปรับขึ้นจาก 17 คะแนน มาเป็น 37 คะแนน อันดับพุ่งพรวดจาก 140 มาเป็นที่ 90 ของโลก ...ด้านมาเลเซียที่ก่อนวิกฤติทำท่าจะโดนพี่ไทยแซงหน้าแต่พอหลังวิกฤติกลับเติบโตได้แข็งแรงเฉลี่ยปีละถึง 5.07%จนค่อนข้างมั่นใจว่าจะได้เป็นประเทศพัฒนาแล้วเสือตัวที่ห้าแห่งเอเชียภายในปี 2520 นี้เป็นแน่ ...ข้างเกาหลีใต้นั้น แทบไม่ต้องพูดถึง แม้จะโดนวิกฤติอ่วมต้องพึ่งเงินช่วยจาก IMF ตั้งครึ่งแสนล้านเหรียญ แต่หลังแก้ไข กัดลูกปืนปฏิรูปหลายด้านจนยังเติบโตได้เฉลี่ยสูงถึง 4.19% นับว่าโตมากที่สุดประเทศหนึ่งในเหล่าประเทศพัฒนาแล้วทั้งหลาย จนมีรายได้ต่อคนต่อปีเกือบ $28,000 รำ่รวยเป็นอันดับที่ 25 ของโลก

สรุปว่ามีเพียงประเทศเดียวที่แป้กยาว คือประเทศไทยแลนด์ของเรานี่เอง ที่ 2000-2016 เศรษฐกิจเติบโตแบบต่ำเตี้ย เฉลี่ยแค่ 3.95%ต่อปี โดยที่หกปีหลัง (2010-2016) นี่โตแค่เฉลี่ยปีละ 2.98% ที่ไม่ใช่จะแค่ตำ่สุดในเหล่าประเทศที่โดนวิกฤติเท่านั้น แต่นับว่าตำ่สุดแห่งหนึ่งในโลกในเหล่าประเทศกำลังพัฒนา (Emerging Market) เลยทีเดียว ซึ่งถ้าเทียบกับอัตราเติบโตเฉลี่ยมากกว่า 9% ในช่วงสิบปี (1986-1996) ก่อนเกิดวิกฤติแล้ว นับว่าต่างกันเป็นฟ้ากะเหวเลยทีเดียว

ผมเลยอยากชวนวิเคราะห์หาสาเหตุว่าทำไมวิกฤติเมื่อยี่สิบปีก่อน ถึงได้เปลี่ยนสถานะเราจากหน้ามือกลายมาเป็นหลังตีน จากประเทศดาวรุ่งคั่วตำแหน่งเสือตัวใหม่กลายมาเป็นประเทศติดกับดักฉายา"คนป่วยแห่งเอเชีย"ได้ขนาดนี้ ซึ่งผมขอตั้งประเด็นเป็นข้อๆเพื่อนำไปสู่การวิเคราะห์วิจัยกันต่อนะครับ

1. ในวิกฤติต้มยำกุ้งของไทยนั้น เป็นวิกฤติในภาคเอกชน ที่ลงทุนเกินตัว โดยใช้แหล่งเงินผิดประเภท คือไปกู้ระยะสั้นมาจากต่างประเทศ พอเราถูกบังคับให้ลดค่าเงิน ผู้กู้ก็ล้มระเนระนาด แต่ก็เป็นเพียงพวกพ่อค้าคนรวยส่วนใหญ่ คนทั่วไปถึงจะเดือดร้อนจากการที่เศรษฐกิจหดตัวรุนแรง แต่ก็เป็นเพียงระยะสั้น แถมลักษณะสังคมไทยที่ใครเดือดร้อนตกงานก็ยังโอบอุ้มช่วยเหลือ ไม่มีใครอดตาย ทำให้เราไม่มีวิกฤติสังคมไม่มี Social Unrest ...พอเราลดค่าเงินลงมาก สินค้าเกษตรก็ราคาพุ่งขึ้น เกษตรกรกลายเป็นดีขึ้นมาก สินค้าส่งออกอื่นๆก็พุ่งขึ้นอย่างมากเพราะมี external price adjustment (ลดค่าเงิน) ขนานใหญ่ มีการลงทุนมีการจ้างงานในอุตสาหกรรมส่งออกเพิ่มมาก คนส่วนใหญ่ได้ประโยชน์

2. ประเทศไทยมีวินัยการคลังต่อเนื่องกันมายาวนาน เราจึงมีระดับหนี้สาธารณะที่ตำ่ รัฐบาลจึงมีทางเลือกทางนโยบายที่จะใช้จ่ายเพื่อกระตุ้นเศรษฐกิจได้ค่อนข้างมาก นอกจากนั้นจากการที่เรามีรัฐธรรมนูญ 2540 ที่เน้นการกระจายอำนาจและทรัพยากร กับการให้รัฐบาลมีอำนาจบริหารมากขึ้น ทำให้เกิดนวัตกรรมประชานิยม ที่เอาทรัพยากรส่วนกลางไปใช้จ่ายแจกได้ในรูปแบบต่างๆ รวมทั้งการขยายตัวของบทบาทและขนาดของรัฐอย่างมากผ่านรัฐวิสาหกิจ และนโยบายแทรกแซงตลาดแบบต่างๆ (เช่น การคำ้ประกันราคาพืชผล) ทำให้ในระยะสั้น ยังทำให้เศรษฐกิจพอจะขยายตัวไปได้

3. จากสองข้อข้างต้น ทำให้เราผ่านวิกฤติมาได้โดยค่อนข้างง่าย ไม่มีแรงกดดันให้ต้องปฏิรูปขนานใหญ่ใดๆ เอกชนมีการเพิ่มประสิทธิภาพ เพิ่มผลิตภาพน้อย เพราะไม่มีความจำเป็น สังเกตได้จาก Total Factor Productivity ของภาคอุตสาหกรรมที่แทบไม่เพิ่มเลย การลงทุนเพื่อ upgrade productivity มีน้อย แถมการขยายตัวอย่างมากของรัฐ เท่ากับว่าเอาทรัพยากรจำนวนมากไปอยู่ในภาคที่ประสิทธิภาพ และผลิตภาพต่ำ และส่งเสริมให้การคอร์รัปชั่นขยายตัวเต็มที่

4. พอเสถียรภาพค่าเงินกลับมา มีการเกินดุลการค้าและดุลการชำระเงินต่อเนื่อง ค่าเงินย่อมถูกกดดันให้แข็งค่าขึ้น ความได้เปรียบด้านราคาย่อมหมดไป แถมประเทศเกิดใหม่รุ่นใหม่อื่นๆเริ่มมีประสิทธิภาพการแข่งขัน มีผลิตภาพมากขึ้น อุตสาหกรรมส่งออกเราก็เลยเริ่มมีปัญหา ไม่สามารถแข่งขันได้ ในขณะที่หนี้สาธารณะทั้งที่อยู่ในระบบ และที่แอบแฝงอยู่ (เช่น ขาดทุนจำนำข้าว ขาดทุนธนาคารรัฐ ฯลฯ) ก็เริ่มที่จะมีเพดานข้อจำกัด การขยายตัวแบบ"รัฐแอบอัด"ก็เริ่มจะถึงทางตัน

โดยสรุป ....ผมคิดว่า เราเรียนรู้จากวิกฤติ"ต้มยำกุ้ง"น้อยมาก เราแทบไม่ได้ใช้โอกาสจากวิกฤติในการปฏิรูปใดๆเลย สิ่งที่ทำ ก็ดูเหมือนจะเป็นแค่สร้างเสถียรภาพความมั่นคงให้กับสถาบันการเงิน (แต่ก็ด้วยต้นทุนที่สูงลิ่ว) แต่ผลิตภาพที่แท้จริงของระบบเศรษฐกิจดูจะมีเพิ่มน้อยมาก พอปัจจัยต่างๆเริ่มจำกัด เช่น การเข้าสู่สังคมสูงอายุ (แรงงานเริ่มจำกัด) เพดานหนี้เริ่มปริ่มทั้งหนี้รัฐ หนี้เอกชน หนี้ครัวเรือน ฯลฯ เราก็เลยติดกับดักลึกลงไปทุกที

ยี่สิบปีผ่านไปอย่างรวดเร็ว ...แน่นอนครับ เรามีโอกาสน้อยมากที่จะเจอวิกฤติแบบเดิมอีก แต่สิ่งที่น่าจะเจอมากกว่า จะกลายเป็นความหนืด ความอืด ที่เศรษฐกิจจะไม่เติบโต หรือโตช้า ซึ่งหลายคนบอกว่า นั่นอาจจะเป็นเครื่องป้องกันวิกฤติที่ดีได้อย่างหนึ่ง (วิกฤติมักจะตามการเติบโตที่ร้อนแรง) แต่ที่ผมกลัวมากกว่าก็คือ ประวัติศาสตร์สอนว่า ในยามที่เศรษฐกิจโตช้าความเหลื่อมล้ำจะยิ่งทวี (เรื่องนี้ Thomas Picketty ดูจะเขียนไว้ชัดในหนังสือ Capital in 21st century ของเขาว่า ระบบ Capitalism ใน Low growth economy จะค่อยๆ ถ่ายโอนสมบัติจากคนจนไปสู่คนรวย ทำให้ความเหลื่อมล้ำมากขึ้นเรื่อยๆ มันเป็นไปเองตามธรรมชาติของระบบทุนนิยม) ถ้าเป็นอย่างนี้ไปเรื่อยๆ แม้ไม่มีวิกฤติเศรษฐกิจก็อาจมีวิกฤติสังคม ซึ่งถ้าเป็นไปอย่างรุนแรง ก็อาจจะล้มล้างระบบไปเลยอย่างที่เคยเกิดในรัสเซีย จีน เวียตนาม กัมพูชา

ซึ่งถ้าเกิดวิกฤติสังคม เกิดสงครามชนชั้น มีสงครามกลางเมืองขึ้นมาจริง เราคงไม่ได้ฟื้นง่ายๆเหมือนตอนปี 2540 หรอกครับ คงต้องใช้เวลาหลายสิบปีทีเดียว


เผยแพร่ครั้งแรกใน:
FacebookBanyong Pongpanich

ติดตามความเคลื่อนไหวของ ประชาไท ทางอีเมล คลิกอ่าน http://goo.gl/8xIcV หรือเฟซบุ๊ค http://fb.me/Prachatai

          China overall PPP GDP will pass US+Japan+Germany combined by 2022   
The IMF has increased the projected GDP growth for China to 6.7 percent in 2017 and average annual growth of 6.4 percent between 2018-20. Previous predictions from the IMF had China at 6.2% or less GDP growth from 2018 to 2020. Based on the lower projections the IMF had China with purchasing power parity GDP increasing for $16600 now to $23960 in 2022. If China matched the improved GDP growth then per capita GDP would be about $24800 in 2022. It would still another 10 to 15 years beyond 2022 (2032 to 2037) for China to move up from slightly
          Economist on "Should i really be doing a PhD in Economics?"   

OP here, not IMF troll. Just considering working in IMF as a potential career but haven't confirmed anything yet


          Comment on The decision to build new State House by Mwansa   
Zambia is broke and Revenue is declining as the Economy shrinks. The Zambia Debt Stock is high relative to Zambia's GDP and Export Earnings. The govt can only build a New State House from New Chinese Borrowingshould at a time govt is failing to finance Universities, Hospitals, maintain existing roads,Eurobonds need to be re-financed and the Debt Stock is already too high. It will financial irresponsibility if the IMF Board approve the $1.3 billion loan without stringent domestic and external Debt limits,Budget Deficit limits etc. Building a New State House is not a priority and should be postponed for now. Furthermore the IMF Board should not approve the $1.3 billion loan until the illegitimate Lungu govt restores Rule of Law, respects Constitutionalism,Good Governance and Human Rights. IMF should not give the Lungu govt to continue persecuting HH and his UPND Supporters who are in Jail for Political Reasons. HH and his Supporters should be released from Prisons unconditionally,unharmed and let the Presidential Petition be heard without fail. Without Economic ,Financial and Political Reforms no IMF Loan, No Western Financial Assistance to the illegitimate Lungu govt in Zambia.
          Comment on EPA to launch Red Team/Blue Team program to evaluate climate science  by Salvatore Del Prete   
https://www.iceagenow.info/sun-might-change-climate/ Global cooling began this year and should continue going forward putting an end to the AGW fraud. Solar parameters finally reaching the criteria which should result in lower global temperatures. Solar criteria is now moving to the values I had said would be significant enough to cause global cooling, following 10+ years of sub – solar activity(2005-present) in general. Duration is now needed for my low average value solar parameters. I am of the opinion that if solar conditions are extreme enough it could move the terrestrial items which govern the climate to threshold values to one degree or another. This is perhaps part of the reason why abrupt climate change has occurred in the past. TERRESTRIAL ITEMS global cloud cover global snow cover/sea ice cover volcanic activity major sea surface temperatures atmospheric circulation LOW AVERAGE VALUE SOLAR PARAMETERS NEEDED TO CAUSE GLOBAL COOLING SOLAR FLUX – SUB 90 – IS IN PLACE SOLAR WIND SUB 350 KM/SEC – GETTING TOWARD THIS COSMIC RAY COUNTS – 6500 UNITS + – IS IN PLACE AP INDEX 5 OR LOWER – COMING DOWN OF LATE EUV/UV LIGHT- EUV 100 UNITS OR LOWER – IS IN PLACE- UV LIGHT DOWN IMF 4.2 NT – NOT REACHED YET ON A REGULAR BASIS. SOLAR IRRADAINCE OFF .15% not reached yet. All given solar effects enhanced by a weakening geo magnetic field.
          Record trade deficit may result in mini budgets   

Staff Reporter Islamabad Islamabad Chamber of Small Traders on Sunday said record trade deficit is becoming unmanageable and it may soon result in new IMF loan and mini-budgets. The trade deficit for eleven months has touched an all-time high mark of thirty billion dollars leaving the government with little options but to seek another IMF […]

The post Record trade deficit may result in mini budgets appeared first on Pakistan Observer.


          IMF Executive Board Approves New US$ 312.1 Million Arrangement Under the Extended Credit Facility (ECF) for Chad and Cancels the Current Arrangement   
– Board’s decision enables immediate disbursement of US$48.8 million for Chad. – The arrangement will support the authorities’ stabilization and recovery strategy and help foster long term robust and inclusive growth. – The arrangement will help stabilize the fiscal position, support a sustainable balance of payments position, and help rebuild the regional international reserve pool. […]
          Moody's Downgrade of Italy Was Not Justified: Expert   
"We do have political uncertainty in Italy but that's not immediate, this Moody's downgrade is in direct conflict with the tone of the IMF report which came out on Italy about six weeks ago, where it noted that Italy has one of the largest primary surpluses amongst the euro zone," Bob Parker, senior advisor at Credit Suisse, told CNBC.
          The Money Shot – The Rand, SAA Bailout & Nike   
Market update: overall the JSE closed ½% higher on Friday which means for the month we are “only” 2.5% down. The Rand had a complete blowout on Friday afternoon: was it that a date has been set for the vote of no confidence or that Reuters reported that Gigaba said SA may have to get help from IMF (does he even know what that means?). Or maybe it was the announcement that SAA will receive a R2.3bn bailout? Private sector credit extension on the increase… how is it possible that banks are lending more money to consumers in this environment? Naspers raised R1bn via a bond issue through its international arm, Myriad International – nice shopping purse. Nike reported a decent set of results last week, just after Bloomberg ran a story saying that “Not even Tiger Woods could make Golf profitable for Nike".
          Comment on You wouldn’t think it, but Brexit is not the biggest threat to the Irish economy right now by Deco   
The ECB always was the greatest threat to the Irish economy. Like a drug pusher is the greatest threat to the health of people in an area. And ECB's purpose is to regulate Ponzi-economics. It's tool is loose monetary policy. The problem is not that the ECB will raise interest rates. The problem is that the ECB encourages malinvestment via lower interest rates, which destabilize the asset markets and cause asset prices to be overpriced. One only has to look at the asking prices of real estate in SECD (South East County Dublin), to see the confluence of institutional Ireland price gouing the rest of society, and asset price overextension combined again. Given Irish direct labour taxes, and indirect taxes, these assets are priced very heavily. This is indicative of a massive misallocation of resources again. And for the ECB is not merely history repeated itself. It is also a double intervention. Because the ECB ensured that the institutional state got buy in for the bailout regime, by not messing with the largesse of the institutional state. The odd thing about the IMF, is that the IMF were always marginalized in the Troika. Two thirds of the Troika was nEU imperial. And those two thirds were supporting the political garrison institutional state complex - who in return were supporting nEU imperial power. It was obvious that the Irish economy was never reformed. It was simply re-ponzified. Borrowing moved to the public sector. In fact there was even borrowing on the public sector to facilitate debt write downs of the politically favoured, and sales to vulture fund investors with strong political connections both in the US, and in the institutional state here. Ireland might be a great country for a certain form of business (Las Vegas on the Liffey) but for (private sector) working stiffs it is a rigged game. With TASC, FF, and the "Labour" party all vying to be the back seat driver in whatever counts as local government (which anyway is turning into a rubber stamp for Brussels, on matters that are outside the scope of favourtism, and market rigging). And it is interesting to hear of debt write downs. The ever tigerish Catherine Murphy has been raising these relentlessly in the Dail. I just hope that she did not steal any apples in any orchards as a kid, otherwise we will hear about it, in the most horrific script writing ever seen. The problem for the ECB is that it has to do something to be seen to be fighting inflation, whilst it runs a regime of Ponzi-economics to favour the well connected. And it is clear that debt levels are too high, therefore there is a massive correction in the works due to unsustainable debt. Therefore the ECB WILL raise interest rates, so that it can lower them when there is a crisis. James Rickards has highlighted how the US Fed are in the process of doing the same. Ireland will probably cope with the ECB this time. A Tech sector crash is an entirely different matter. Spain might cope. Portugal probably will not. In fact I expect Portugal to stick it to the ECB, rather than accept a lecture. And Italy is highly vulnerable - and has a clown waiting to take over the government. France has a massive internal capital misallocation problem, which has occurred for decades - and which will be made worse by another centralizer running the government. As usual the important firms in Paris and Frankfurt will get "advance notice". But even that might not save the Frankfurt bank that Renzi called Monte Passchi multipled by a factor of 100. It is the unknowns that are going to cause the problem. 2008 showed us that highly regulated firms, can be caught out when a Ponzi-scheme falls apart. Policy since then has been to ensure that the Ponzi-scheme is always liquid. This is not good policy. Had Madoff a seat on a central bank, his funds would never have unravelled. That is the nature of bad central banking.
          By 2100, Refugees Would Be the Most Populous Country on Earth   
Poverty and deadly wars are the major drivers of displacement.

The UN Refugee Agency has announced the new figures for the world’s displaced: 65.9 million. That means that 65.9 million human beings live as refugees, asylum seekers or as internally displaced people. If the refugees formed a country, it would be the 21st largest state in the world, just after Thailand (68.2 million) and just ahead of the United Kingdom (65.5 million). But unlike these other states, refugees have few political rights and no real representation in the institutions of the world.

The head of the UN Refugee Agency, Filippo Grandi, recently said that most of the displacement comes as a result of war. "The world seems to have become unable to make peace," Grandi said. "So you see old conflicts that continue to linger, and new conflicts erupting, and both produce displacement. Forced displacement is a symbol of wars that never end."

Few continents are immune from the harsh reality of war. But the epicenter of war and displacement is along the axis of the Western-driven global war on terror and resource wars. The line of displacement runs from Afghanistan to South Sudan with Syria in between. Eyes are on Syria, where the war remains hot and the tensions over escalation intensify daily. But there is as deadly a civil war in South Sudan, driven in large part by a ferocious desire to control the country’s oil. Last year, 340,000 people fled South Sudan for refugee camps in neighboring Uganda. This is a larger displacement than from Syria.

Poverty is a major driver of displacement. It is what moves hundreds of thousands of people to try and cross the Sahara Desert and then the Mediterranean Sea for European pastures. But most who try this journey meet a deadly fate. Both the Sahara and the Mediterranean are dangerous. This week, the UN’s International Organisation for Migration (IOM) in Niger rescued 600 migrants from the Sahara, although 52 did not survive.

A 22-year-old woman from Nigeria was among those rescued. She was on a pick-up truck with 50 people. They left Agadez for Libya. ‘We were in the desert for ten days,’ she says. "After five days, the driver abandoned us. He left us with all of our belongings, saying he was going to pick us up in a couple of hours. But he never did." Forty-four of the migrants died. The six who remained struggled to safety. ‘We had to drink our own pee to survive,’ she said.

Getting to Libya is hard enough. But being in Libya is perilous. Violence against vulnerable migrants inside Libya continues to occur. The IOM reports the presence in Libya of ‘slave markets.’ Migrants who make it across the Sahara into Libya have told investigators that they find themselves in these slave markets where they are bought to be taken to private prisons and put to work or else sold back to their families if they can raise the high ransom payments. UNICEF reports incidents of rape and violence against women and children in these private prisons. One 15-year-old boy said of his time in a private prison, "Here they treat us like chickens. They beat us, they do not give us good water and good food. They harass us. So many people are dying here, dying from disease, freezing to death."

Danger lurks on the sea as well. This year already IOM reports least 2,108 deaths in the sea between Libya and Italy. This is the fourth year in a row that IOM has counted over 2,000 deaths by mid-year. Over the past five years, this averages out to about 10 deaths a day. Libya, broken by NATO’s war in 2011, remains a gateway for the vulnerable from various parts of Africa, countries damaged by IMF policies and by warfare. There is no expectation that the numbers of those on the march will decrease.

In a recent paper in The Lancet (June 2017), Paul Spiegel, formerly of the UN Refugee Agency suggests that the "humanitarian system was not designed to address the types of conflicts that are happening at present." With over 65 million people displaced, the various institutions of the UN and of the NGO world are simply not capable of managing the crisis.

"It is not simply overstretched," Spiegel wrote of the humanitarian system, "it is no longer fit for purpose."

These are shattering words. One problem Spiegel identifies is the assumption that refugee flows are temporary, since wars will end at some point. What happens when wars and occupations are permanent? People either have to live for generations in refugee camps or they will seek, through dangerous passages, flight to the West. He gives the example of Iran, which absorbed over a million Afghan refugees without using the camp strategy. They simply allowed the Afghans into Iranian society and absorbed them by putting money into their various social schemes (such as education and health). Spiegel also points out that refugees must be part of the designing the process for humanitarian aid. These are good suggestions, but they are not going to be possible with the limited funds available for refugees and with the crisis level of activity that detains the humanitarian agencies.

Spiegel does not deal with one of the great problems for humanitarianism: the persistence of war and the theory that more war—or the current euphemism, security—is the answer to humanitarian crises. This January, over 1,000 people tried to scale the large barrier that divides Morocco from the Spanish enclave of Ceuta. Looking at that barrier, one is reminded of the idea that walls will somehow prevent migration, a view driven by President Donald Trump. Violence met the migrants, a mirror of the violence that was visited among migrants along the spinal cord of Eastern Europe last year. Walls, police forces and military interventions are all seductive to an imagination that forgets why people migrate and that they are human beings on the run with few other options. There is a view that security barriers and security forces will raise the price of migrant and deter future migrants. This is a silly illusion. Migration is dangerous already. That has not stopped anyone. More humane thinking is necessary.

It is important therefore that the UN Deputy Secretary-General Amina Mohammed told a meeting on the Sahel on June 28 that the world leaders need to "avoid a disproportionate emphasis on security" when dealing with the multiple crises in the Sahara region and north of it. "No purely military solution" can work against transnational organized crime, violent extremism and terrorism, nor against poverty and hopelessness. Underlying causes are not being addressed, and indeed the surface reactions—to bomb more—only create more problems, not less.

In the July issue of Land Use Policy, professors Charles Geisler and Ben Currens estimate that by 2100 there will be 2 billion refugees as a result of climate change. These numbers are staggering. They are an inevitable future. By then, refugees will be the largest country on earth—nomads, seeking shelter from destruction of climate and capitalism, from rising seas and wars of greed.

 

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          Bill Blain: "Welcome To The Second Half In Which Many Are Very Concerned About A Bubblicious Market Reversal"   

From Bill Blain of Mint Partners.

Morning Porridge - July 3rd 2017

“If you can keep playing tennis when somebody is shooting a gun down the street, that’s concentration…”

* * *

Welcome to the second half of 2017. This week is likely to be thin - the first week of the great summer slowdown and Wimbledon, US holidays and payrolls on Friday.

But... what comes next?

We've muddled through the first half. It’s been confusing, interesting and frustrating in equal measure. Global Equities have added over $14 trillion – and with Global Market cap now at $76 trillion, they are about equal to Global GDP. (That’s not a level to panic about overvaluation – but it’s worth noting.) The positives, I am reliably informed, include improving signs of global growth, a supposed economic renaissance in Europe, and a general switch away from bonds into equity. Lots of participants remain very concerned on the prospects for bubblicious stock market reversal later this year, but others point to yet more upside. After all, stock market surprises don’t occur when everyone predicts them…..

The numbers can paint the story:

GDP expectations: In Jan the IMF forecast 3.6% global GDP Growth. Europe was seen at 1.6%, US at 2.3% and UK at 1.4%. These are now forecast as Global growth at 3.5% GDP (down 0.1%), Europe down at 1.4% (down 0.2%), US at 2.5% (up 0.2%), and UK down at 1.3% (down 0.1%). Nothing to panic about.

Global Stocks: FTSE was 7177 Jan and 7346 this morning. Dow was 19881 in Jan and 21350 this morning. Nothing to fret about… 

Global Bonds: 10-yr Treasuries were 2.45% in Jan, and 2.31% this morning. 10-yr bunds were 0.36% in Jan and 0.46% this morning. 10-year Gilts were 1.42% in Jan and 1.28% this morning. Nothing to get stressed over…

In short, it’s been an up, down and shake it all about kind of year… There are clear signals of concern about what the withdrawl of “extraordinary monetary policy” will mean. Normalisation is seen as a threat by some, but by others as a very useful “reset” to get markets back on a properly priced realistic track.

However, the political picture has been very mixed – and looks likely to continue to lead markets. We're moving into a new phase as existing relationships are re-drawn at all levels, from the geo-political, to Brexit concerns. All have the ability to move market sentiment.

In Europe there is a new mood in play: the massive concerns earlier this year about French political stability were unfounded and Macron has kick-started a new era of hope for the EU. We still have doubts about Italy, but Merkel looks untouchable. The ECB has the occasional wobble (like last week’s mixed messages) about how its going to rein in QE, but the main risk for markets is the new Macron/Merkel axis over-promises and under-delivers growth and reform, potentially triggering a new confidence reversal across Europe just as the ECB runs out of capacity for further QE. The market very much expects the "do-whatever-it-takes" dictum means the ECB will step in and stabilise.  

However, we have a significant leadership vacuum elsewhere in the West.

The UK's strong and stable government proved illusionary, and has crashed into disorder just as the critical Brexit negotiations begin. Are markets really pricing in the fact their does not actually appear to be any plan? It’s less than helpful the mixed signals and apparent disunity at the BOE about timing the next hike also suggest dither and weakness.

In the US Donald Trump's unfulfilled promises and rabid twittering are not only embarrassing, but potentially destabilising, raising doubts about leadership, policy implementation and Fed independence of action. 

Trump is notionally "leading" an increasingly fragmented and distracted West while Putin remains very much in charge in Russia and Xi imposes his will across SE Asia. The weekend’s 20th anniversary of Hong Kong's "liberation" from Britain was a blunt message to the former colony: "forget the past, your future is China". Weak occidental leadership opens opportunities for Russia and China.

And what about Japan – where the Abe era looks to be sliding? Abe’s LDP is losing seats and confidence in him is dropping. Things change slowly in Japan, but the new girl on the Block, Tokyo Mayor Yuriko Koike is described as Japan’s Macron by my senior Japan watcher, Martin Malone. And even the Bank of Japan is thinking about how much more to dosh into markets – the answer is less.

Markets move on confidence, and confidence is a function of politics...

Bit of fun this morning as I heard an Irish politician arguing Ireland should follow the UK out of Europe. Hah. But he may have a point.. after all, the Irish have got all the roads and EU infrastructure grants they can possibly use…


          IMF Programme: Salary Cuts, Heavy Taxes Haunt Cameroonians   
By Yerima Kini Nsom Cameroonians will soon be grappling with another wave of salary cuts and heavy taxes when Government fully bows to the nitty-gritty of another Structural Adjustment Programme, SAP, with the International Monetary Fund, IMF. If Government fully gives in to the IMF programme, another slash of civil servants’ salaries will be in the making. The IMF holds that the State wage bill is too heavy for an ailing economy like Cameroon. In 2016, the State wage bill stood at FCFA 955. 2 billion, of this amount, retired personnel take home FCFA 194 billion. According to the 2017 budget, civil servants will take home FCFA 998.5 billion as salaries in addition to the FCFA 205 billion that retired workers are bagging as benefits. Experts hold that a cut in salaries will bring unsound consequences on the economy. They insist that corruption increased three fold when the salaries of civil servants were cut by almost 70 percent in 1993. Besides, the 1993 cuts stirred a dangerous wave with members of the Cameroon Public Servants Union, CAPSU, demonstrating in the streets of some towns in the country for several months. Cameroon is once more under the heat of the IMF SAP. The country is bowing to diktats of the Bretton Woods Economic gendarme in the wake of the ongoing economic asphyxia ailing countries of the CEMAC Sub Region. The move was sanctioned by IMF’s FCFA 390 Billion loan to Cameroon recently. The implication of the loan compels President Biya’s country to fully bow to austerity measures, given that the country is facing a continuous decline in petrol revenue. The IMF is urging Cameroon to widen its tax base so as to increase non-oil revenue. According to IMF’s Deputy Director, Mitsuhiro Furusawa, Cameroon can only get out of the current crisis if it embarks on the stringent management of the State budget by enhancing public investments that will stimulate growth. From every indication, 2018 is a difficult economic year for Cameroonians who, will be hunched with more and heavier taxes. Even President Paul Biya’s directives on the 2018 annual budget are predicated on widening the nation’s tax base. IMF’s rescue plan is one with a heavier taxation burden on Cameroonians. It will be a logical continuation because 30 new taxes were introduced in the 2017 budget. For instance, the increase of special tax on petroleum products increased prices at filling station. A sojourn Tax of FCFA 1000 to 5000 per night was imposed on hotels in the country. With an increase and introduction of new taxes, economists are already expressing fears that it will provoke an outburst of inflation on basic commodities, especially foodstuff. For one thing, the IMF is also advising Cameroon to continue with the privatisation of some State corporations in the adjustment programme. Thus, State corporations like the National Oil Refining Company, SONARA, the Cameroon Telecommunication Corporation, CAMTEL and the Cameroon Postal Services, CAMPOST, are being earmarked for privatisation. The move is coming at a time when Parliament is studying two draft laws aimed at better management of State corporations and public enterprises. The IMF holds that State corporations are so poorly managed that they become liabilities to the State instead of assets for economic growth. For one thing, appointment of managers and recruitment of personnel in such corporations is more often predicted on other considerations, which continued to milk the State dry through the payment of subsidies. According to the Minister of Finance, Alamine Ousmane May, the State paid FCFA 32. 7 billion to State enterprises by June 2017. This is an indication that servicing Cameroon’s debts that stand at a circa FCFA 5000 billion will be an uphill task. The logical beginning of Cameroon’s march to the IMF adjustment programme was on December 23, 2016, when President Paul Biya chaired an extraordinary meeting of CEMAC Heads of State. The meeting was to address the declining economic situation in the Sub Region. The continuous fall of the prices of petrol in the world market as well as some internal crisis had put CEMAC countries in a difficult situation. The IMF Director General, Christine Lagarde, who attended the meeting in the company of the French Minister of the Economy and Finance, Michel Sapin, insisted that CEMAC countries must bow to certain measures in order to survive. The choice was that between the devil and the deep sea for they were asked to choose between the IMF structural adjustment programme and the devaluation of the FCFA. The CEMAC countries chose the former. It is for this reason that Cameroon is hearkening to the IMF programme with all the unsound consequences. The programme compels the country to cut its coat according its size by way of the stringent management of public finances and by inflicting a heavy tax burden on the people. Despite the huge wage bill, it is reported that shady deals in which ghost civil servants continue to receive salaries, are still very much alive. Measures the Ministry of Public Service and Administrative Reforms has taken to rid ghost workers from the civil servants pay roll have not been able to fully eradicate the phenomenon. Corruption and complicity of some officials have made it possible for civil servants who abandoned their jobs and travelled for greener pastures abroad, to continue to receive their salaries. Even the civil servants census a few years ago, did not help matters.
          Bill Blain: "Welcome To The Second Half In Which Many Are Very Concerned About A Bubblicious Market Reversal"   

From Bill Blain of Mint Partners.

Morning Porridge - July 3rd 2017

“If you can keep playing tennis when somebody is shooting a gun down the street, that’s concentration…”

* * *

Welcome to the second half of 2017. This week is likely to be thin - the first week of the great summer slowdown and Wimbledon, US holidays and payrolls on Friday.

But... what comes next?

We've muddled through the first half. It’s been confusing, interesting and frustrating in equal measure. Global Equities have added over $14 trillion – and with Global Market cap now at $76 trillion, they are about equal to Global GDP. (That’s not a level to panic about overvaluation – but it’s worth noting.) The positives, I am reliably informed, include improving signs of global growth, a supposed economic renaissance in Europe, and a general switch away from bonds into equity. Lots of participants remain very concerned on the prospects for bubblicious stock market reversal later this year, but others point to yet more upside. After all, stock market surprises don’t occur when everyone predicts them…..

The numbers can paint the story:

GDP expectations: In Jan the IMF forecast 3.6% global GDP Growth. Europe was seen at 1.6%, US at 2.3% and UK at 1.4%. These are now forecast as Global growth at 3.5% GDP (down 0.1%), Europe down at 1.4% (down 0.2%), US at 2.5% (up 0.2%), and UK down at 1.3% (down 0.1%). Nothing to panic about.

Global Stocks: FTSE was 7177 Jan and 7346 this morning. Dow was 19881 in Jan and 21350 this morning. Nothing to fret about… 

Global Bonds: 10-yr Treasuries were 2.45% in Jan, and 2.31% this morning. 10-yr bunds were 0.36% in Jan and 0.46% this morning. 10-year Gilts were 1.42% in Jan and 1.28% this morning. Nothing to get stressed over…

In short, it’s been an up, down and shake it all about kind of year… There are clear signals of concern about what the withdrawl of “extraordinary monetary policy” will mean. Normalisation is seen as a threat by some, but by others as a very useful “reset” to get markets back on a properly priced realistic track.

However, the political picture has been very mixed – and looks likely to continue to lead markets. We're moving into a new phase as existing relationships are re-drawn at all levels, from the geo-political, to Brexit concerns. All have the ability to move market sentiment.

In Europe there is a new mood in play: the massive concerns earlier this year about French political stability were unfounded and Macron has kick-started a new era of hope for the EU. We still have doubts about Italy, but Merkel looks untouchable. The ECB has the occasional wobble (like last week’s mixed messages) about how its going to rein in QE, but the main risk for markets is the new Macron/Merkel axis over-promises and under-delivers growth and reform, potentially triggering a new confidence reversal across Europe just as the ECB runs out of capacity for further QE. The market very much expects the "do-whatever-it-takes" dictum means the ECB will step in and stabilise.  

However, we have a significant leadership vacuum elsewhere in the West.

The UK's strong and stable government proved illusionary, and has crashed into disorder just as the critical Brexit negotiations begin. Are markets really pricing in the fact their does not actually appear to be any plan? It’s less than helpful the mixed signals and apparent disunity at the BOE about timing the next hike also suggest dither and weakness.

In the US Donald Trump's unfulfilled promises and rabid twittering are not only embarrassing, but potentially destabilising, raising doubts about leadership, policy implementation and Fed independence of action. 

Trump is notionally "leading" an increasingly fragmented and distracted West while Putin remains very much in charge in Russia and Xi imposes his will across SE Asia. The weekend’s 20th anniversary of Hong Kong's "liberation" from Britain was a blunt message to the former colony: "forget the past, your future is China". Weak occidental leadership opens opportunities for Russia and China.

And what about Japan – where the Abe era looks to be sliding? Abe’s LDP is losing seats and confidence in him is dropping. Things change slowly in Japan, but the new girl on the Block, Tokyo Mayor Yuriko Koike is described as Japan’s Macron by my senior Japan watcher, Martin Malone. And even the Bank of Japan is thinking about how much more to dosh into markets – the answer is less.

Markets move on confidence, and confidence is a function of politics...

Bit of fun this morning as I heard an Irish politician arguing Ireland should follow the UK out of Europe. Hah. But he may have a point.. after all, the Irish have got all the roads and EU infrastructure grants they can possibly use…