Global Crisis

World Bank Will Provide $1 Billion For Insurance In Mideast Investment

Posted on Monday, July 04, 2011

WASHINGTON - The World Bank's political risk guarantee agency said on Monday it would mobilize about $1 billion for insurance coverage for countries in the Middle East and North Africa to encourage foreign direct investment. The Multilateral Investment Guarantee Agency, or MIGA, said its underwrite...

European Banks May Need To Raise $72B To Meet Capital Requirements

Posted on Monday, July 04, 2011

LONDON/FRANKFURT - Europe's banks may need to raise over 50 billion euros ($71.6 Billion) after regulators slapped an extra capital surcharge on big lenders to make them safer and forbid the use of debt to pad out the extra cushion. Bank shares hit a low for the year as lenders in France and German...

George Soros: Country Leaving Euro Currency 'Probably Inevitable'

Posted on Monday, July 04, 2011

VIENNA - Billionaire investor George Soros thinks a country will eventually exit the euro zone and urged policymakers on Sunday to come up with a "plan B" that could rescue the European Union from looming economic collapse. Soros, famous for making $1 billion by betting against the British pound in...

France, Banks Agree To Make Greek Plan More Agreeable To Creditors

Posted on Monday, July 04, 2011

The French treasury and banks have agreed on a proposition to make a Greek debt rollover more palatable to creditors through a combination of longer maturities and less risk, Le Figaro reported on Sunday. Under the plan, creditors would reinvest just 70 percent of the proceeds reimbursed when Greek...

Interest Rates Must Rise Globally To Curb Inflation: International Report

Posted on Monday, July 04, 2011

BASEL, Switzerland - Global interest rates must rise to avoid high inflation becoming entrenched, the Bank for International Settlements said on Sunday. It also warned that delaying deficit cuts could risk intensifying the sovereign debt crisis and have grave consequences were investors to lose con...

Global Regulators Agree To Impose Extra Capital Charge On Biggest Banks

Posted on Monday, July 04, 2011

BASEL - Global banking regulators have agreed on a proposal to slap an extra capital charge on the world's biggest banks to make them safer by 2019. The surcharge is part of a series of regulatory reforms launched in response to the financial crisis, which forced countries worldwide into costly bai...

As Greece goes to privatize some of its sovereign real estate holdingsin order to raise capital

Posted on Thursday, June 30, 2011

As Greece goes to privatize some of its sovereign real estate holdingsin order to raise capital, it finds itself the only country in Europe without a centralized registry of deeds. About 40% of properties are currently in dispute and lack clear title. Why does this sound vaguely familiar? And it is ...

Five economic lessons from Sweden, the rock star of the recovery

Posted on Thursday, June 30, 2011

STOCKHOLM — Almost every developed nation in the world was walloped by the financial crisis, their economies paralyzed, their prospects for the future muddied. And then there’s Sweden, the rock star of the recovery. This Scandinavian nation of 9 million people has accomplished what the United ...

Obama's Partner in Athens

Posted on Thursday, June 30, 2011

Athens, Greece: President Obama's fate may rest, in part, on his counterpart in Athens. A year ago, the U.S. economy was poised for recovery, only to be roiled by the first Greek debt crisis. This past week, it was déjà vu: Wednesday's positive trends on Wall Street were foiled by Thursday's riots o...

Big Banks Face Criticism For Speculative Role In Global Food Crisis

Posted on Thursday, May 05, 2011

Today, rising food prices are wreaking havoc in the developing world. While some blame overpopulation, and others ethanol, another culprit has emerged of late: banks and the role of speculative commodity indexes. The primary danger of the indexes, according to a new article by Frederick Kaufman in ...

Japan Crisis Causes Drop in U.S. Mortgage Rates

Posted on Monday, April 04, 2011

The 9.0 earthquake and subsequent tsunami that devastated Japan last week sent a ripple through the U.S. mortgage markets causing interest rates to lower this week. "With the crisis in Japan, investors rushed to buy the security of U.S. Treasury bonds, which lowered its yields and other interest ...

Japanese Government Plans To Lend Struggling Businesses Up To $127B

Posted on Tuesday, March 22, 2011

The Japanese government plans to dedicate up to 10 trillion yen ($127 billion) in crisis lending to businesses to help them finance day-to-day operations and repair damage from last week's deadly earthquake and tsunami, the Nikkei newspaper reported on Saturday. The government can provide special f...

Crises in Japan Ripple Across the Global Economy

Posted on Tuesday, March 22, 2011

In the wake of Japan’s cascading disasters, signs of economic loss can be found in many corners of the globe, from Sendai, on the battered Japanese coast, to Paris to Marion, Ark. Container ships sit in the Pacific or at docks in Japan, wary of unloading tons of pork and steak because of that nat...

U.S. Economic Policy Not Changing In Response To Japan As Officials See Little Risk

Posted on Sunday, March 20, 2011

American policy makers are expressing assurance that the ongoing crisis in Japan will not affect the tenuous economic recovery underway in the United States, and anticipate no additional measures to spur growth. Friday's 9.0-magnitude earthquake off the northeastern coast of Japan has sent financi...

U.S. Dollar Falls Below Eighty Yen, Close To Postwar Low

Posted on Sunday, March 20, 2011

NEW YORK — The dollar dropped to a record low against the yen late Wednesday as Japan's nuclear crisis deepened. Debt woes in Europe, tension in the Middle East and weak economic reports at home also weighed on the greenback. The dollar plunged to 76.53 Japanese yen late Wednesday, falling far b...

Japan Could Avoid An Economic Meltdown By Pulling Together

Posted on Sunday, March 20, 2011

TOKYO - In these dark hours, Japan would do well to heed former White House Chief of Staff Rahm Emanuel's memorable maxim that you never want a serious crisis to go to waste. As the nation struggles to avert a nuclear catastrophe on the heels of a deadly earthquake and tsunami, it takes a huge leap...

China's Central Bank To Slow 'Unacceptable' Yuan Growth, Says Central Bank Official

Posted on Sunday, March 20, 2011

BEIJING - China will not tolerate any sharp yuan rises to shield local exporters, limiting annual appreciation to 3 percent in the next five years, a senior central bank official was quoted by local media as saying. China's central bank has to keep buying foreign exchange to limit yuan gains, a rep...

Japan’s Meltdown and the Global Economy’s

Posted on Sunday, March 20, 2011

Four years ago, there were fears of a financial meltdown — a term borrowed from the nuclear power industry. Now there are fears of a real meltdown. Comparing the two events may risk seeming insensitive to the rising human toll in northern Japan, but there are similarities in causation. In each c...

Saving the Yen

Posted on Friday, March 18, 2011

Howard Schneider and Neil Irwin: "The United States and other major industrialized nations will combine in a rare coordinated currency intervention on Friday to keep the Japanese yen from rising too sharply in value in the wake of the country’s recent natural disasters, a sign of the deep global con...

Who Has the Toughest Banking Rules, U.S. or Europe?

Posted on Thursday, March 17, 2011

Regulatory arbitrage is the latest buzz-phrase. Wall Street’s new parlor game is guessing whether Swiss, British or United States banks will end up with the toughest rules on capital and liquidity. But as reforms play out around the world there’s also the possibility that entire business lines will ...

Food Prices Push 44 Million Into Poverty: World Bank

Posted on Thursday, February 17, 2011

WASHINGTON -- Rising global food prices has pushed an estimated 44 million more people into extreme poverty in developing countries over the past eight months, the World Bank said Tuesday. The poverty-fighting institution said its food price index increased by 15 per cent between October, 2010, and...

RESPONSE: A "stealthy default" may punish foreign creditors

Posted on Thursday, February 17, 2011

IT'S abundantly clear that America's fiscal arithmetic simply does not add up. The implication is a continued increase in its government debt-to-GDP ratio over the medium term. But will this lead to crisis? And, if so, what kind of crisis? One option is to "do a Japan" which, despite all its diffic...

The Boom, the Bubble, and the Bust Abroad

Posted on Wednesday, February 16, 2011

The housing crisis this country has experienced over the past four years has been the worst since the Great Depression. That comes as no surprise to most Americans; as home prices fell, the country saw a vigorous debate about the crisis, and about the laws and regulations that have emerged to help p...

How We're Doing Compared to the Rest of the World

Posted on Wednesday, February 16, 2011

In the past month, President Obama has pressed the autocratic president of our most important Arab ally to heed the demands of his people and step down, established a workman-like relationship with China's president, and delivered a State of the Union address that sought to "win the future." Taken t...

Imagining Life Without Fannie and Freddie

Posted on Monday, February 14, 2011

KUDOS to Treasury and the Department of Housing and Urban Development for some straight talk about the nation’s broken mortgage system. A report to Congress from those departments, published on Friday, provided some long-awaited analysis by the Obama administration about what went wrong in housi...

The Next Economic Crisis

Posted on Monday, February 14, 2011

Mumbai, India -- Like stock indexes around the world, India's Sensex plunged with the news of the unrest in Egypt, largely over fear about oil prices. But unlike other exchanges, the Sensex has not bounded back. It fell for four straight days, rebounded for one, and then on Friday fell by 2.9 perc...

Afghanistan's "Too Big to Fail" Bank Is Failing --

Posted on Monday, February 07, 2011

Guess Our System Doesn't Work There, Either The collapse of Afghanistan's largest bank will seem familiar to Americans, and so will the upcoming reports of its bailout. We've heard the story before: Unheeded warnings. Lax (or nonexistent) law enforcement. An American auditor who said nothing as th...

The Next Global Banking Crisis Is 3 Years Away

Posted on Monday, February 07, 2011

We're sowing the seeds of the next global banking crisis and the crash could be just a few years away, according to a new paper from international consulting firm Oliver Wyman. Here is The Atlantic's summary to what could be the next worldwide recession. The one-sentence description of Oliver Wym...

The 13 Countries That Control the World’s Gold

Posted on Friday, February 04, 2011

Even if 2011 has gotten off to a rough start for gold, everyone knows that the value of gold is at historic highs. What is interesting is that there is rarely a discussion about which countries actually have a lock on the world’s gold. 24/7 Wall St has compiled a list of the top 13 nations which h...

End Of Cheap Food Era As Grain Prices Stay High

Posted on Friday, February 04, 2011

CHICAGO - U.S. grain prices should stay unrelentingly high this year, according to a Reuters poll, the latest sign that the era of cheap food has come to an end. U.S. corn, soybeans and wheat prices -- which surged by as much has 50 percent last year and hit their highest levels since mid-2008 -- ...

Poll: Americans increasingly view global economy as a negative for U.S.

Posted on Friday, February 04, 2011

A growing number of Americans consider the accelerating trend toward globalization a bad thing for the United States. At the same time, a majority now sees being the world's No. 1 economic power as an important national goal. Just over one-third of all Americans see the increasing interconnection ...

Shared Norms for the New Reality

Posted on Thursday, January 27, 2011

Following a decade characterized by an explosion of global challenges, and most recently a structural economic crisis, we now live in a completely new reality. Never before has the world faced so many serious challenges simultaneously. Leaders from all sectors of society are finding it increasingly ...

IMF: EU Needs Bigger Rescue Fund

Posted on Thursday, January 27, 2011

JOHANNESBURG - Europe needs to strengthen its financial rescue fund to reduce the risk of renewed global instability as U.S. tax cuts and buoyant emerging economies help propel the recovery elsewhere, the IMF said on Tuesday. Rich nations should nurture their slower growth rates by keeping monetary...

GLOBAL CRISIS - Poverty in Numbers: The Changing State of Global Poverty from 2005 to 2015

Posted on Thursday, January 27, 2011

Poverty reduction lies at the core of the global development challenge. For the international development community, this objective serves not only as a source of motivation, but as a defining theme across its work. Many of the world’s most prominent aid organizations cite poverty reduction as their...

Poverty in Numbers: The Changing State of Global Poverty from 2005 to 2015

Posted on Tuesday, January 25, 2011

Poverty reduction lies at the core of the global development challenge. For the international development community, this objective serves not only as a source of motivation, but as a defining theme across its work. Many of the world’s most prominent aid organizations cite poverty reduction as their...

World Bank: Rich Nations' Growth Lags Need For Jobs

Posted on Saturday, January 15, 2011

WASHINGTON - Economic growth in the world's wealthier nations is still too slow to create enough jobs for the tens of millions who lost their during the worst global recession since World War Two, the World Bank said on Wednesday. In a report detailing its outlook for 2011, the multilateral lender...

Paul Krugman: Why The Euro Could Be Doomed

Posted on Saturday, January 15, 2011

Call it the curse of the single currency. In this week's New York Times Magazine, Paul Krugman argues that the pace of recovery in Europe is being slowed because each country is tied to using the euro as a currency, but lacks the benefits of a single government. While the human cost of the econo...

New European Banking Regulator Will Conduct a Stress Test on Lenders

Posted on Saturday, January 15, 2011

PARIS — The European banking regulator said on Thursday that it would conduct another round of stress tests on lenders this spring, a move that investors hope will offer more clarity on the health of balance sheets than previous exercises. Also Thursday, a panel of international regulators said th...

Rising Chinese Inflation to Show Up in U.S. Imports

Posted on Thursday, January 13, 2011

BEIJING — When garment buyers from New York show up next month at China’s annual trade shows to bargain over next autumn’s fashions, many will face sticker shock. “They’re going to go home with 35 percent less product than for the same dollars as last year,” particularly for fur coats and cotton s...

Record High Food Prices Stoke Fears For Economy

Posted on Tuesday, January 11, 2011

SINGAPORE/LONDON - Record high food prices are moving to the top of policymaker agendas, driven by fears it could stoke inflation, protectionism and unrest and dent consumer demand in key emerging economies. The United Nations' food agency (FAO) said on Wednesday that food prices hit a record hig...

What Lies Ahead in 2011?

Posted on Wednesday, January 05, 2011

NEW YORK – The global economy ends 2010 more divided than it was at the beginning of the year. On one side, emerging-market countries like India, China, and the Southeast Asian economies, are experiencing robust growth. On the other side, Europe and the United States face stagnation – indeed, a Ja...

China Property Market Limps Into New Year

Posted on Tuesday, January 04, 2011

BEIJING (By Langi Chiang and Simon Rabinovitch) - Chinese housing prices are on track to dip early next year, with tighter monetary policy and rising inventories combining to take some air out of a market that some fear could yet swell into a bubble. The government launched a campaign late last y...

Global Food Prices in 2011 Face Perilous Rise

Posted on Tuesday, January 04, 2011

Food prices globally are rising to dangerous levels. There is talk of a coming crisis, like the ones that produced riots around the world in 2008 and 1974. Many of the ingredients of a disaster are present, but governments can stop the problem before it causes too much damage. A warning sign is th...

EU Debt Crisis Is 'Systemic,' According To Official's Warning

Posted on Friday, December 17, 2010

BRUSSELS/BERLIN (By Jan Strupczewski and Erik Kirschbaum): European Union leaders will be warned on Thursday that a rolling debt crisis poses a systemic threat to the euro zone as they seek to paper over divisions at a summit on how to restore confidence. European Commission President Jose Manuel B...

Revised Fed Data Raises Doubt on Foreign Appetite for Build America Bonds

Posted on Friday, December 10, 2010

Amid growing worries about state budget deficits and pension burdens, one bright spot in the municipal bond market has been data showing that foreign investment had climbed to record-setting levels. The surge was widely credited to foreign interest in the taxable bonds that dozens of states have...

Volcker Says U.S. Economic and Political Influence Globally Is Waning

Posted on Friday, December 03, 2010

There were disturbingly blunt and devastatingly negative thoughts about the current economic and political condition of the U.S. spoken by Paul Volcker, chairman of President Obama's Economic Recovery Advisory Board, last night at a Common Cause dinner in New York. He singled out the danger facing ...

An Original Plan 'B for the Eurozone

Posted on Wednesday, December 01, 2010

So Ireland is the latest recipient of EU bailout money. It is now clear to everyone that the Eurozone is very much a two-tier affair. On the one hand are countries like Germany and France, who remain relatively resilient by European standards. On the other, there are those such as Portugal, Ireland,...

Ireland Bailout: European Union Agrees To $89 Billion Loan

Posted on Wednesday, December 01, 2010

BRUSSELS — European Union nations agreed to give euro67.5 billion ($89.4 billion) in bailout loans to Ireland on Sunday to help it weather the cost of its massive banking crisis, and sketched out new rules for future emergencies in an effort to restore faith in the euro currency. The rescue deal, a...

Europe’s Crisis of Liquidity

Posted on Wednesday, December 01, 2010

Instead of long-term insolvency, running out of cash is what causes financial crises like the one slowly unfolding in Europe. Yet much of the effort by policy makers around the globe has been to shore up solvency, not stabilize sources of financing. Unless that changes, the world will lurch from cri...

How Germany got it right on the economy

Posted on Wednesday, December 01, 2010

BERLIN It may be turkey week in America, but it's goose month in Germany. In many restaurants, you can get goose in your salad and goose in your soup to go with your goose entrée. Diners fairly honk their way through November. But then, Germans have something to honk about. Germany's economy is...

Debt crisis escalates in Europe; fears grow about Spain

Posted on Wednesday, December 01, 2010

LONDON -- The debt crisis in Europe escalated sharply Friday as investors dumped Spanish and Portuguese bonds in panicked selling, substantially heightening the prospect that one or both countries may need to join troubled Ireland and Greece in soliciting international bailouts. The draining confi...

The Spanish Prisoner

Posted on Wednesday, December 01, 2010

The best thing about the Irish right now is that there are so few of them. By itself, Ireland can’t do all that much damage to Europe’s prospects. The same can be said of Greece and of Portugal, which is widely regarded as the next potential domino. But then there’s Spain. The others are tapas; Sp...

Roubini Maps Out Nightmare Scenario of Domino Debt Collapse in Europe

Posted on Wednesday, December 01, 2010

"We have too much private debt in the case of Ireland," according to Nouriel Roubini. But the nub of the crisis is this: "We have decided to socialize the private losses of the banking system. Now you have a huge increase in public debt—going from 7 percent to 100 percent of GDP. Soon it will be 12...

Roubini Maps Out Nightmare Scenario of Domino Debt Collapse in Europe

Posted on Monday, November 22, 2010

"We have too much private debt in the case of Ireland," according to Nouriel Roubini. But the nub of the crisis is this: "We have decided to socialize the private losses of the banking system. Now you have a huge increase in public debt—going from 7 percent to 100 percent of GDP. Soon it will be 12...

The Debt Problems Of The European Periphery

Posted on Friday, November 19, 2010

The Baseline Scenario Last week’s renewed anxiety over bond market collapse in Europe’s periphery should come as no surprise. Greece’s EU/IMF program heaps more public debt onto a nation that is already insolvent, and Ireland is now on the same track. Despite massive fiscal cuts and several years ...

Ireland Debt Crisis: Contagion Fears Loom Over EU Meeting

Posted on Friday, November 19, 2010

BRUSSELS — An anxiously awaited meeting of European finance ministers ended Tuesday without an agreement to bail out Ireland's debt-stricken government, though both Irish and EU officials vowed to stabilize the banks at the center of the crisis and keep it from spreading to other fragile economies c...

O.E.C.D. Sees Global Recovery Slowing

Posted on Friday, November 19, 2010

PARIS — Global growth prospects have clouded recently as a result of regional imbalances, persistently high unemployment and the failure of private consumption to pick up the slack created by the withdrawal of government stimulus, the Organization for Economic Cooperation and Development said Thursd...

Capital Failure

Posted on Wednesday, November 17, 2010

The Group of 20 summit for heads of government this weekend will apparently “hail bank reform,” particularly as manifest in the Basel III process that has resulted in higher capital requirements for banks. According to leading authorities on the issue, however, the Basel process is closer to a disas...

Joseph Stiglitz To Obama: The Fed's Dollar Policy Is Hurting Other Nation's

Posted on Wednesday, November 17, 2010

Nobel Prize-winning economist Joseph Stiglitz, dismissing the Federal Reserve’s quantitative easing as a “beggar-thy-neighbor” strategy of currency devaluation, called on America to learn the art of stimulus from China. President Barack Obama has defended the Fed’s controversial program, tellin...

Obama: Strong US Economy Key To Global Recovery

Posted on Wednesday, November 17, 2010

SEOUL, South Korea — Celebrating America's Veterans Day, President Barack Obama on Thursday saluted the bravery of U.S. troops who defended South Korea during its war with North Korea and condemned the communist north for continuing on a course that he says deepens its isolation from the rest of t...

Economic Crisis Sidelines Fate of the World’s Poorest

Posted on Thursday, November 11, 2010

WASHINGTON — Last year, after a personal appeal from President Obama in which he cited his own family’s experiences in Kenya, world leaders gathered at the Italian hill town of L’Aquila pledged $20 billion over three years to help millions of the world’s poorest farmers grow enough food to feed them...

Government Support of Homeownership in

Posted on Tuesday, November 02, 2010

Critics have said that governments in countries with homeownership rates similar to those of the U.S. don't subsidize homeownership, so why should the U.S.? In many cases, that’s just not true. Here are some examples of how other governments support to encourage homeownership. Canada Homeowners...

China banks

Posted on Friday, October 29, 2010

Scattered throughout Wednesday’s third-quarter numbers from Bank of China and Agricultural Bank of China, the first of the country’s big lenders to report, are homilies about “promoting [the bank’s] healthy development” and “managing risks and sharpening competitiveness.” This isn’t just the stand...

US can afford to take greater risks

Posted on Wednesday, October 27, 2010

Published: October 27 2010 01:35 | Last updated: October 27 2010 01:35 From Mr John Bishop. Financial Times Sir, Martin Wolf does well to contrast the fiscal policy approaches adopted by the US and the UK when both have ballooning budget deficits to manage (“Britain and America seek different p...

Scramble to adjust to a new reality

Posted on Wednesday, October 27, 2010

By Geoff Dyer Published: October 27 2010 Financial Times If a global financial meltdown can be said to have a winner, then that would be China. Its economy has rebounded rapidly after the government responded to the crisis quickly and in size. While many developed countries are still wilting,...

Economy: Move from investment to consumption

Posted on Wednesday, October 27, 2010

By Geoff Dyer Published: October 27 2010 Financial Times China’s economy is running into headwinds. Most governments in the developed world would love to have its problems, yet all the same, the country’s growth outlook is becoming more uncertain. The authorities themselves were probably surp...

Property: Housing at risk of going out of control

Posted on Wednesday, October 27, 2010

By Geoff Dyer Published: October 27 2010 Financial Times If the Chinese economy were to suffer a nasty accident over the next few years, it is likely that housing will be at the bottom of it. Given the underlying demand for housing, it might seem surprising even to entertain the prospect of a ...

A Gray Market in Real Estate

Posted on Thursday, October 21, 2010

ORDOS, China — As the real estate action in Kangbashi New Area reached a fevered pitch last year, banks that are controlled by the national government, concerned about overbuilding, began restricting loans to property developers here. Many builders barely broke stride. They turned to undergrou...

A Comparison of EU and U.S. Financial Regulatory Reforms

Posted on Thursday, October 21, 2010

On October 7, the International Centre for Financial Regulation and Brookings held a joint meeting to improve understanding of the European financial regulatory agenda and the similarities and differences in priorities and legislation with U.S. regulatory initiatives. At the meeting, participants co...

Bernanke lectured Japanese officials for mishandling their economy.

Posted on Thursday, October 21, 2010

By JON HILSENRATH As a Princeton professor in the 1990s, Ben Bernanke lectured Japanese officials for mishandling their economy. Jon Hilsenrath discusses Bernanke's criticism of Japan's central bank a decade ago, saying it offers hints of what the Fed's next steps might be. Today, Tokyo's econ...

China

Posted on Friday, October 08, 2010

Having worked in financial news for more than 15 years I understand well why reporters and columnists regularly develop narrative arcs to explain complicated economic issues. After all, these storylines often are the easiest way to get people to comprehend esoteric topics like gyrations in the g...

and the US

Posted on Tuesday, October 05, 2010

Just three years since America began dragging the world into its deepest recession in seven decades, Goldman Sachs Group Inc., Credit Suisse Holdings USA Inc. and BofA Merrill Lynch Global Research are forecasting that this time will be different. Goldman Sachs predicts worldwide growth will slow 0....

China

Posted on Thursday, April 23, 2009

China now has over $2 trillion in US reserves and debt. Boy we sure better be nice to them! And we're going to need them to buy eve more in order for us to come up with the money to fund all this bail out spending....

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