Monday, May 20

Finance, Investing

High finance, equity markets and economic data related to it.

3Mar By Patti MohrNo Comments
Currency, Debt, National Budgets & Interest Rates, Global Economics, Types of News: Brief

U.S. Federal Reserve Says Economic Outlook Has ‘Changed Materially’ as Coronavirus Spreads

March 3, 2020--Over a week into turbulence in the financial markets from a global outbreak of the coronavirus, the U.S. Federal Reserve cut its policy rate by 50 basis points amid signs that the economic outlook has "changed materially." Federal Reserve Chair Jerome Powell said he expects the COVID-19 virus to impact the global economy "for some time." It has already affected tourism and travel industries and threatens to disrupt global supply chains. "The magnitude and persistence of the overall effects on the economy, however, remain highly uncertain, and the situation remains a fluid one," Powell said on Tuesday. Globally, the COVID-19 virus has infected at least 90,893 people across 21 countries and killed 3,110, the World Health Organization reported today. Market Turbulence...
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21Jan By Patti MohrNo Comments
Currency, Debt, National Budgets & Interest Rates, Types of News: Brief

Global Debt Rises to $188 Trillion

In case you missed it... (We did!) Jan. 21, 2020-Global debt rose by $3 trillion in 2018 to reach $188 trillion, according to data released late last month by the International Monetary Fund. The data suggests many countries will be "ill-prepared" for the next economic downtown, an IMF blog post asserted. Referencing the data in an interview today with CNBC, IMF chief Kristalina Georgieva said the low interest rates fueled higher risk investments, such as stocks. She added that loose monetary policies are responsible for a significant amount of global growth.
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US Debt Tops $22 Trillion as Lawmakers Deliver New Deal
23Jul By Patti MohrNo Comments
Currency, Debt, National Budgets & Interest Rates, Domestic Politics, Global Economics, Types of News: Brief, United States

US Debt Tops $22 Trillion as Lawmakers Deliver New Deal

July 23, 2019--U.S. lawmakers agreed to raise the limit on incurring national debt to $22 trillion to July 31, 2021. They also agreed to a two-year budget agreement that increases spending by $320 billion. Democratic House Speaker Nancy Pelosi called it a "bold, bipartisan and a victory for Democrats and the American people." President Donald Trump said in a tweet the deal is "a real compromise in order to give another big victory to our Great Military and vets." According to Pelosi's statement, the deal increases both defense and non-defense spending and avoids a government shutdown. The U.S. national debt has risen from $11.9 trillion in 2009 to $22 trillion in 2019. Meanwhile, the interest on the debt (marketable non-government) has risen from 2.28 percent to 2.5 percent in t...
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Big Tech May Pose Big Risks for Finance Firms, Consumers
25Jun By Patti MohrNo Comments
Big Tech, Digital Economy, Finance, Investing, Types of News: Analysis

Big Tech May Pose Big Risks for Finance Firms, Consumers

June 25, 2019 -- As big technology firms expand their services to include finance, it is poses new risks to consumers, competitors and financial systems. With large customer bases, access to massive amounts of data and the ability to scale-up quickly, technology-service providers like Alibaba, Amazon, Apple, Facebook, Google, Groupon and Tencent are poised to change the financial-services industry, international analysts say. A Ripe Opportunity for Growth Currently earning just 11 percent of their revenues from their financial services, many tech firms are eyeing the field as a means to make big profits. New services include payments systems, digital money, money management, insurance and lending. "Big techs have the potential to loom large very quickly as systemically rele...
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U.S. Debt Doubles Under A Decade of Deficits
5Nov By Patti MohrNo Comments
Currency, Debt, National Budgets & Interest Rates, Types of News: Analysis

U.S. Debt Doubles Under A Decade of Deficits

Nov. 5, 2018--The U.S. national debt doubled over the last decade, from $10 trillion in 2008 to over $21 trillion this year, as the government continually spent more money than it raised in revenue. The largest deficits came during the Obama Administration in the aftermath of the 2008-09 global financial crisis: $1.4 trillion in 2009, $1.29 trillion in 2010 and $1.3 trillion in 2011. The U.S. economy had fallen into recession at the end of 2007 and did not begin to recover until June 2009. By 2014, however, the economy resumed steady annual growth. National Debt Even during today's relative strong economic growth period, annual deficits are reaching close to $1 trillion a year. The annual deficit is projected to reach $833 billion this fiscal year and $984 billion in FY2019. As ...
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U.S. Economy ‘Strong,’ Fed Says; Others Warn of ‘Darkening’ Global Economic Outlook
14Jun By Patti MohrNo Comments
Currency, Debt, National Budgets & Interest Rates, Global Economics, Organizations, IMF, WTO, G7, Types of News: Brief

U.S. Economy ‘Strong,’ Fed Says; Others Warn of ‘Darkening’ Global Economic Outlook

June 14, 2018-The U.S. economy is "rising at a solid rate," the Federal Reserve said yesterday as it raised its short-term interest rate from 1.75 to 2 percent and projected two more increases this year. A strong labor market, household spending, and business investment are strengthening the economy while the inflation rate hovered around 2 percent, the Federal Open Market Committee statement said. Asked about U.S. trade tensions between the United States and its partners, Federal Reserve Chairman Jerome Powell said he hears rising concerns from business leaders who are delaying investment decisions. He added, however, that at this point, it is simply "a risk" rather than a current reality. "Right now, we don't see that in the numbers at all," Powell said. "The economy is very str...
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European Central Bank Continues Stimulus, Sees 2.4% Growth This Year
8Mar By Patti MohrNo Comments
Currency, Debt, National Budgets & Interest Rates, Types of News: Brief

European Central Bank Continues Stimulus, Sees 2.4% Growth This Year

March 8--The Governing Council of the European Central Bank left three key interest rates at their current rates and said it would continue to do so "an extended period of time, and well past the horizon of the net asset purchases." The ECB Governing Council said inflation is "consistent" with its aim of 2 percent. The three key interest rates are the 1.) main refinancing operations, 2.) the marginal lending facility, and 3.) the deposit facility. Those will remain unchanged at 0.00%, 0.25% and -0.40% respectively. Continued Liquidity The ECB plans to continue to purchase net assets at the current rate of €30 billion per month, putting liquidity back into the system through at least the end of September 2018. "This will contribute both to favorable liquidity conditions and to an...
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Market Correction Could See 40 Percent Drop, JP Morgan Exec Says
8Mar By Patti MohrNo Comments
Finance, Investing, Global Economics, Types of News: Brief

Market Correction Could See 40 Percent Drop, JP Morgan Exec Says

March 8--Although equity markets are still in a growth cycle, an eventual correction could mean a decline of 20 to 40 percent, according to a top executive at JP Morgan Chase & Co. "Markets are functioning, and we're doing well," Daniel Pinto, JP Morgan Co-President and Co-Chief Operating Officer, said in an interview with Bloomberg Television on Thursday. "We know there will be a correction at some point." Pinto estimated that the markets have two to three years before the end of the growth cycle. He said that while volatility has come down, markets are still going to react to "anything that relates to inflation or growth." Eventually, when liquidity dries up, markets could fall as much as 40 percent. "The most important thing for someone like us is just to be prepared. Be...
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Government Regulators Raise Alarms on Virtual Currencies
18Feb By Patti MohrNo Comments
Big Tech, Digital Economy, Cryptocurrency, Types of News: Brief

Government Regulators Raise Alarms on Virtual Currencies

As virtual currencies like Bitcoin, Ethereum and Ripple rise in use and value, government regulators around the world are paying closer attention, issuing consumer warnings, and are looking for ways to regulate them. The international nature of virtual currencies, also called cryptocurrencies, allows them to operate outside the reach of national governments. But increasingly, regulators are considering ways to oversee the exchanges or, in some cases, ban them. The Rise and the Risk Cryptocurrencies are gaining in popularity and in dollar terms. The combined value of cryptocurrencies reached $800 billion earlier this year before falling down to $433 billion. In the past five years, Bitcoin's value alone rose from $5 billion in 2013 to $115 billion in 2018. Observers say the wild flu...
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Amid Protests, Brazil Passes 20-Year Austerity Plan
16Dec By Patti MohrNo Comments
Currency, Debt, National Budgets & Interest Rates, Domestic Politics, Global Economics

Amid Protests, Brazil Passes 20-Year Austerity Plan

News Brief Damaged by a two-year recession, corruption scandals and protests at home, Latin America's largest economy turned to constitutional reforms to control its rising debt and spending. Brazil's Senate voted 53-16 in favor of a 20-year cap on spending increases for social welfare programs. The House has already passed the bill, which becomes law. The constitutional amendment, PEC 55, will cap government spending on health care, education and social security through 2036 at current rates adjusted for inflation. Supporters said it will create certainty in fiscal budgets, control rising debt, and attract foreign investment. They said the amendment also guarantees a floor for the spending programs. Opponents, however, said the spending caps would hurt the poorest and lock fu...
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