May 16, 2022
Slowing growth globally
It is not looking good for the global economy:
- China's growth is down well below estimates last week
- EU's growth is 2.7% compared to the 4% estimate
- Brazil's inflation has hit 12%
- USA is heading for recession.
- USA manufacturing is already down.
- six consecutive weeks of declines for the NASDAQ and the S&P500 is doing as poorly
- $2 trillion-plus wiped-out at the FAANGs
- African country inflation is growing with little room for their newly reformed "market" economies (i.e., governments) to respond.
- USA dollar is continuing its appreciation, pushing the global economy into problems.
- Goldman Chief sees recession, Goldman Economists do not see recession, but see slump.
- Inflation in the UK will cost the average family £2,400 this year – which foretells (a 40% chance of) recession. As a percentage of earnings, that number is wildly understating the impact on poorer families.
In the year ending March 2019, the average (median) annual household income in each quintile before housing costs were paid was:
- top quintile: £54,000
- second highest quintile: £35,700
- middle quintile: £26,800
- second lowest quintile: £20,500
- bottom quintile: £13,300
In the year ending March 2019, the average (median) annual household income in each quintile after housing costs were paid was:
- top quintile: £49,000
- second highest quintile: £31,600
- middle quintile: £23,300
- second lowest quintile: £16,600
- bottom quintile: £9,200
- Same for the rest of the world on real incomes
The IMF on policy response to the next recession after the one coming
Yep, that's a clear indication of everyone knows capitalism isn't stable.
The IMF is now saying that instead of unaccountable central banks giving money directly to finance capital, it should give money directly to households.
From a classical perspective, the impact is rather the same as giving money to capital. And, it doesn't address the underlying problem. More money circulating does not equal more investment in production.
Climate and food
- We are already seeing the impacts on food supply thanks to climate change.
India restricted exports [of wheat], exacerbating supply concerns and fears over increasing food protectionism. The country made the decision as a record heat wave slashes crop production
