Reuters (August 22)
The “boom-to-bust saga” of China Evergrande Group drew closer to the end with its formal “delisting from the Hong Kong stock exchange on Monday,” which as the largest by market value and volume in recent years.” For investors, “the journey has been anything but grand.” After achieving a $9 billion market cap in its 2009 IPO, Evergrande rocketed ahead, growing “more than five-fold to $51 billion eight years later only to plummet to earth,” with it’s current value approximately $282 million and creditor claims of approximately $45 billion. “The company’s journey from stock exchange darling to a pariah in the financial markets is a cautionary tale of unbridled debt-fuelled expansion in the world’s second-largest economy.”
Tags: Boom, Bust, Cautionary tale, China. Evergrande, Creditor claims, Debt-fuelled, Delisting, Expansion, Hong Kong, Investors, IPO, Market value, Pariah, Stock exchange, Volume
Wall Street Journal (May 21)
“Computer science is hotter than ever at U.S. universities. But students graduating this month are discovering their degrees are no longer a surefire ticket to tech-industry riches.” As tech giants slow expansion and embrace artificial intelligence, they “now have less need for entry-level hires—or are shedding jobs” so graduates “are finding it harder than they ever thought it would be to land a job.”
Tags: AI, Computer science, Entry-level hires, Expansion, Graduates, Students, Surefire, Tech industry, U.S., Universities
The Economist (May 28)
Signs suggest “America’s markets are entering a new, more worrying phase.” Falling share prices could initially be attributed to the Federal Reserve’s policy moves, but “in recent weeks share prices have kept falling, even as bond yields have dropped back,” a combination suggesting recession. “Indeed, the mix of Fed tightening, slowing gdp and rising production costs has the ominous feel of the later stages of a business cycle. The expansion is barely two years old. Yet investors are already worried that corporate profits are under threat.”
Tags: Bond yields, Business cycle, Expansion, Falling, Fed, GDP, Investors, Markets, Ominous, Production costs, Profits, Recession, Share prices, Signs, Tightening, U.S., Worried, Worrying
Bloomberg (November 16)
China’s Q3 expansion is “the weakest since the government began releasing quarterly data in 1992. An obvious cause is the ongoing trade war…, but the economy would be decelerating even without that as is transitions away from the high debt, often wasteful growth model of the past. The knock-on effects are global, affecting companies and consumers alike.”
Tags: China, Debt, Decelerating, Economy, Expansion, Government, Q3, Trade war, Wasteful growth
Wall Street Journal (August 31)
Another recession “could be devastating for people who have only just recovered.” The record long U.S. expansion “has showered” the top 1% of households with “staggering new wealth,” but bypassed others. “The bottom half of all U.S. households, as measured by wealth, have only recently regained the wealth lost in the 2007-2009 recession and still have 32% less wealth, adjusted for inflation, than in 2003…. If another recession comes, it could be devastating.”
Wall Street Journal (May 20)
“The Japanese economy unexpectedly grew in the first quarter of 2019 supported by government spending, although there were some worrying signs connected to the U.S.-China trade dispute.” The economic expansion (2.1% annualized) surprised economists who thought “the first-quarter figure would be flat or slightly negative.”
Tags: China, Economists, Economy, Expansion, Government, Japan, Spending, Trade dispute, U.S., Unexpected
The Economist (September 22)
“Mr Abe may be burning to give Japan a more normal foreign policy, but what it needs most is a more normal economy. His signature policy—Abenomics—is far from complete. The fiscal and monetary expansion, his first two “arrows”, were supposed to buy time for the third and most important one: sweeping structural reforms, leading to enduring growth. The economy should take precedence over constitutional reform… Otherwise, Mr Abe will be remembered less for his long tenure than for wasting it.”
Tags: Abe, Abenomics, Arrows, Constitutional reform, Economy, Expansion, Fiscal, Foreign policy, Growth, Japan, Monetary, Structural reforms
Reuters (April 27)
For “the first time since March 2008 the BOJ used the word ‘expansion’ to describe the state of the economy, signaling its conviction that the recovery was gaining momentum.” Still, some “analysts doubt inflation will accelerate as quickly as the BOJ projects, with slow wage growth keeping households from boosting spending.”
Tags: Analysts, BOJ, Economy, Expansion, Household spending, Inflation, Momentum, Recovery, Wage growth
The Economist (May 21)
Before the WWII, available date suggests business “cycles aged like people…. the odds of tipping into recession rose as an expansion got older.” Since then, however, the data is counter-intuitive, indicative of “ageless recoveries.” “Since the 1940s age has not withered them: an expansion in its 40th month is just as vulnerable, statistically, as one in its 80th (each has about a 75% chance of surviving the next year).”
Tags: Ageless recoveries, Business cycles, Counter-intuitive, Data, Expansion, Recession, Vulnerable, WWII
Financial Times (May 2)
More needs to be done on fiscal and monetary co-operation. “The past few weeks have highlighted the limits of monetary policy expansion. The current framework combining quantitative easing and negative interest rates is offering rapidly diminishing returns because it is not producing the large, permanent increase in the money in circulation that would be required to turn inflation expectations around and lift the world economy out of deflationary deadlock.”
Tags: Cooperation, Deflationary deadlock, Diminishing returns, Economy, Expansion, Expectations, Fiscal, Inflation, Limits, Monetary, Negative interest rates, Quantitative easing
