The Lastest Macroeconomic News
10.11.2016 14:40 Trump`s win gives the global economy a new level of worry
The election of Donald Trump as U.S. president creates new uncertainties for a world economy that`s already fragile, said investors and economists who wonder how far he will take his promises to tear up trade deals and restrict immigration. The real estate billionaire struck a conciliatory tone in his victory speech, arguing he would seek good relations and partnership with other countries. That has helped world markets and U.S. stock futures to recover some of the huge losses suffered earlier. But Trump`s trashing of trade agreements -- including his promise to back out of the Trans-Pacific Partnership with Asian countries -- and the general lack of detail on key issues leave many uncertain about the direction of the world`s biggest economy and market. “We simply can`t know what type of President Trump will be,” said Paul Ashworth, chief U.S. economist for Capital Economics.
09.11.2016 11:20 Is A Russia-China Economic Alliance On The Horizon?
As Russia continues to contend with sanctions from the United States and European Union after annexing Crimea in 2014, it has cast its eye on a new ally: China. The two countries are already aligning themselves for security purposes, a prime example being their position against the U.S. missile shield deployment plans in South Korea. Both China and Russia have stated that the Terminal High Altitude Area Defense (THAAD) anti-missile system situated in South Korea to contain North Korea harms their relations with the U.S. Combine this with China`s potentially shaky relations with America (depending on the results of the election), and a stronger economic alliance between China and Russia may be on the horizon.
07.11.2016 18:27 How the oil crisis wrecked Russia and obliterated Venezuela
The future is not rosy for Russia and Venezuela. The Kremlin faces a big budget deficit, which it`s trying to close with cuts to health and education spending, and a massive 27 percent reduction in its military. Meanwhile, Russia`s economy is in recession, and projected to slightly shrink for the third year in a row. If that sounds bad, check out Venezuela, which is in utter economic pandemonium: Its GDP is projected to shrink 10 percent this year, and it`s grappling with triple-digit inflation rates. Mass strikes and protests are breaking out, and its authoritarian government is threatening to crack down. On the surface, these may seem like two very different countries with two very different sets of problems. But underneath, their woes actually share a common source: oil.
05.11.2016 11:50 Warren Buffett Doesn`t Think We Should Worry about the U.S. Economy
Analysts in the U.S. have been worrying about sluggish economic growth for the past few years, with Donald Trump saying that gross domestic production (GDP) has grown just 1%. While U.S. GDP has hovered around or below 2% in past quarters, there`s no need to fret, said Warren Buffett. In an interview with Carlyle`s David M. Rubenstein on Bloomberg late Tuesday, Buffett said there`s always compound interest - the same financial force that helped him make billions. “If you already have an already prosperous economy, and we have one of the most prosperous in the world, and you keep compounding it over time, people will be living far better 20 years from now than they are now,” Buffett said.
03.11.2016 12:36 Russia in Decline
On October 20, The Jamestown Foundation held a workshop in Washington D.C. titled “Russia in Decline,” with the participation of a veritable Who`s Who of senior American experts on Russia. It was the concluding exercise of an extensive research project on Russia designed to provide policy guidance to the next president of the United States. Prior to the workshop, the leader of the project, S. Enders Wimbush, had solicited written contributions by a dozen of the best-known Russian political commentators and economists. The bottom line of both the workshop and Russian contributions was a remarkable consensus: Russia has entered a period of prolonged decline that will take many years to reverse even if it could be stopped soon, which is unlikely. The decline is man-made and predates Russian aggression in Ukraine and Western sanctions; it is the aggregation and interaction of a variety of negative systemic trends in Russian society already in existence. Reversing these trends, the experts concluded, will be extremely difficult if not impossible. Russia`s decline is likely permanent.
02.11.2016 17:19 What is the real state of affairs in the Russian economy?
Economist Yakov Mirkin gave another pessimistic forecast about the state of affairs in the Russian economy. According to him, Russia will face a decline in living standards, an economic setback and fluctuations in GDP growth on minimal levels. At the same time, international experts say that the Russian economy has been stabilizing, whereas Standard and Poor`s and Fitch have upgraded the ratings of major Russian companies. What is happening in reality? Pravda.Ru requested an expert opinion from Vice-Rector of the Financial University under the Government of the Russian Federation, Doctor of Economic Sciences, Professor, Honored Economist of the Russian Federation, Sergei Silvestrov. "Who is closer to the truth about the current state of affairs in the Russian economy? Can Russia boast of any success in overcoming the crisis?" "There are no large-scale changes at this point. It is only agriculture that shows some improvement, and this is largely a consequence of the allocation of state credits and tax incentives from the government. All other sectors of the Russian economy are, unfortunately, stagnating.
02.11.2016 13:50 Russia could miss some economic 2017 targets
Even with crude oil prices holding relatively stable, a former finance minister in Russia said it will be tough for the oil-based economy to hit 2017 targets. Russian Prime Minister Dmitry Medvedev said the federal budget was based on oil priced at around $40 per barrel, about $10 per barrel less than the current level. Central Bank Gov. Elvira Nabiullina said the rate of inflation is expected to be close to its low-end outlook of around 5.5 percent this year and the International Monetary Fund said there are prospects for "modest" recovery starting in 2017. Alexei Kudrin, the director of Russia`s Center for Strategic Research and a former finance minister, was quoted by Russian news agency Tass as saying, meanwhile, the budget deficit for this year could be as high as 3.9 percent of gross domestic product. "The plan for next year is 3.1 percent, which will be difficult to fulfill," he said.
31.10.2016 15:45 China`s Only 15% Of The Global Economy But Contributes 25 - 30% Of Global Growth
It`s entirely possible to become a little over-enthusiastic about the size of China`s economy. Yes, assuming that we don`t count the European Union as one economy, it`s the second largest economy on the planet. If we do agglomerate Europe then it`s the third. But it`s also true that it`s around 15% or so of the global economy. That`s massively up from where it was in recent decades, entirely true, but it`s not that it is anything like the majority of what is going on out there. We should be careful with these numbers of course, they`re not going to be accurate. We simply don`t measure the global economy in any particularly accurate manner. We could well be out by a few percentage points either way here. So keep that in mind. However, there`s another way of looking at that Chinese economy and that`s to think of its contribution to global growth. There it`s more like 25-30% of total growth as the Chinese themselves are saying: On the other hand, as the second largest economy, China`s economic transition and growth is increasingly influencing the world economy. “It is estimated that the contribution of China`s economic growth to the world economy is expected to maintain at 25 to 30 percent, he said.
29.10.2016 12:46 The World Economy Without China
Is the Chinese economy about to implode? With its debt overhangs and property bubbles, its zombie state-owned enterprises and struggling banks, China is increasingly portrayed as the next disaster in a crisis-prone world. I remain convinced that such fears are overblown, and that China has the strategy, wherewithal, and commitment to achieve a dramatic structural transformation into a services-based consumer society while successfully dodging daunting cyclical headwinds. But I certainly recognize that this is now a minority opinion. For example, US Treasury Secretary Jacob J. Lew continues to express the rather puzzling view that the United States “can`t be the only engine in the world economy.” Actually, it`s not: the Chinese economy is on track to contribute well over four times as much to global growth as the US this year. But maybe Lew is already assuming the worst for China in his assessment of the world economy.
27.10.2016 11:23 Sanctions Damage Russian Economy but Don`t Work as Political Tool
The sanctions imposed on the Russian economy cost the country up to 1 percent of the GDP growth every year but they do not work as an instrument of political influence, former Russian Finance Minister Alexei Kudrin said Wednesday. "Russia bears significant expenses because of the sanctions. I always mention the figure from 0.8 percent to 1 percent of the GDP growth that is not achieved… annually. That`s why the words that the sanctions are insignificant are not true. They have a significant impact on our economy, growth and living standards," Kudrin told reporters. The former minister added at the same time the sanctions were not effective as a political tool. "It is another matter that [the sanctions] as the political tool do not function, do not work. I agree with this. It has not influenced our policy at all," Kudrin added. Following the beginning of the Ukrainian crisis, the European Union and the United States accused Moscow of meddling in Kiev`s internal affairs and imposed several rounds of sanctions against Russia, as well as decreasing the general level of cooperation with Russia. The Russian authorities have refuted the allegations, warning that the Western measures are counterproductive.
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