World Economy

Donald Trump warns China he won't back down on trade tariffs

US president says he expects to move ahead on plans to raise tariffs to 25% from 1 January
Donald Trump has raised the stakes in the escalating global trade dispute between the US, China and some of America’s traditional allies ahead of a major gathering of world leaders this week.
Ahead of the G20 meeting in Argentina, which begins on Friday, the US president used a newspaper interview to warn China that he expects to move ahead on the imposition of higher import tariffs on Chinese goods.
The news sent shares lower in London and New York on Tuesday, after Trump told the Wall Street Journal it was “highly unlikely” that he would heed a call by Beijing to refrain from increasing the tariffs from the start of next year.
It paves the way for the existing 10% US import tariff on $200bn (£158bn) of Chinese goods to increase to 25% from 1 January.
Economists at the Dutch lender Rabobank said the world economy could suffer badly over the next decade if the US-China trade war escalates further, with as much as 2% of GDP growth lost by 2030.

The goals:
1- Stability in financial system
2- Price stability - fighting inflation
3- Full employment
4- Economic growth
5- Interest rate stability
6- Currency stability

This time - banking field...
what is a Corporate Action?

Corporate Action:
Corporate Action is any event that brings material change to a company and affects its stakeholders. This includes shareholders, both common and preferred, as well as bondholders. These events are generally approved by the company's board of directors. There are numerous types of Corporate Action but they all fall within either of the following two groups:
1. Mandatory Corporate Actions –the event is mandatory for shareholders, meaning that they have no choice in whether to participate when the issuer calls for it. A shareholder does not have to do anything in a Mandatory Corporate Action. Mandatory Corporate Actions are often subject to shareholder's approval at the AGM though.
2. Voluntary Corporate Actions - The event is voluntary for shareholders, meaning that they can elect and make their own choice depending on the available options. Some events allow the shareholders to take no action which will leave their securities position unaffected by the Corporate Action.

What is NE (Nash Equilibrium)?

Nash equilibrium, named after American Economist John Nash (1928-2015) is a solution to a non-cooperative game where players, knowing the playing strategies of their opponents, have no incentive to change their strategy. Having reached Nash equilibrium a player will be worse off by changing their strategy. In the Prisoner’s Dilemma game, when both players adopt the confess strategy there will be no incentive for either player to switch to a ‘deny’ strategy, unless it can be guaranteed that the other player also denies.

How you define the Fiscal Policy?

Fiscal policy
Fiscal policy is the deliberate alteration of government spending or taxation to help achieve desirable macro-economic objectives by changing the level and composition of aggregate demand (AD).

Types of fiscal policy

There are two types of fiscal policy, discretionary and automatic.

Discretionary policy refers to policies which are decided, and implemented, by one-off policy changes.
Automatic stabilisation, where the economy can be stabilised by processes called fiscal drag and fiscal boost. If direct tax rates are progressive, which means that the % of income, then a rapid increase in national income will be slowed down automatically. Fiscal drag means that, as incomes rise, the impact of rising incomes for the better off is reduced as they pay proportionately higher taxes, and the impact of rising incomes on the poor and unemployed is reduced as they come off benefits, and start to pay tax. The effect is that the increase in disposable income is moderated.

Can new technologies speed up growth in emerging economies?

https://agenda.weforum.org/2015/10/why-emerging-economies-should-embrace-disruptive-technologies/?utm_content=buffer5a078&utm_medium=social&utm_source=facebook.com&utm_campaign=buffer

Why emerging economies should embrace disruptive technologies Kemal Derviş says emerging countries can use technology to catch up with advanced economies.

Taiwan or South Korea: which is more optimistic about the outlook for the next generation?

https://agenda.weforum.org/2015/10/which-asian-economy-is-most-optimistic-about-the-future/?utm_content=buffer7a556&utm_medium=social&utm_source=facebook.com&utm_campaign=buffer

Which Asian economy is most optimistic about the future? In a poll of Asian nations, one stands out as most hopeful for the next generation

Where Do Chinese Equities Go from Here?

China is in the eye of the storm. When the storm first approached, it took investors by surprise and did some serious damage. The Chinese government stepped in and while failing at first, made an impact. When initial public offerings (IPOs) were temporarily halted, shorting was banned, and journalists and social media posters were held accountable for writing anything negative about the Chinese economy, it was abundantly clear that the Chinese government was desperate. However, after the People's Bank of China (PBOC) announced that the correction was almost over, investors regained their confidence. On Oct. 19, 2015, the Shanghai Composite Index sat at 3386.70.

Read more: Where Do Chinese Equities Go from Here? http://www.investopedia.com/articles/markets/102215/where-do-chinese-equities-go-here.asp
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Where Do Chinese Equities Go from Here? Is it time to go long or short on Chinese equities?

The IMF’s new World Economic Outlook (IMF 2015) points out that the world economy is at the intersection of at least three powerful forces.

First, China’s economic transformation – away from export- and investment-led growth and manufacturing, in favour of a greater focus on consumption and services.
This process, however necessary and healthy in the longer term, has near-term implications for China’s growth and its relations with its trade partners.

Second, and related, the fall in commodity prices.
Years of high global demand drove prices upward and spurred investment in commodity sectors. But as China began to slow earlier during the present decade, many commodity prices turned downward, starting in the second half of 2011, and their fall has accelerated recently.

Third, there is the impending normalisation of monetary policy in the US.
Relatively favourable output and price performance in the US could soon justify an interest rate increase, but the possible global repercussions, especially in emerging and developing economies, add to current uncertainties.

Amid these developments, we project that in the near term global growth will remain moderate and uneven, with higher downside risks than were apparent at our July 2015 update. The ‘holy grail’ of robust and synchronised global expansion remains elusive.

Disparate fortunes

What do the numbers say? Broadly speaking, these reflect a reduction from our forecasts of last July. Global real GDP grew at 3.4% last year, but will grow at only 3.1% this year. For 2016, we project a rebound to 3.6% growth. We have reduced both of these numbers by 0.2 percentage points compared with our last projections three months ago.

The aggregate numbers reflect disparate fortunes between the advanced and the emerging market and developing economies.
In advanced economies we project a moderate growth pick-up this year relative to last, notably in the US and Eurozone. Unfortunately, Japanese growth seems to be faltering after a strong first quarter. Advanced economies grew at a 1.8% rate last year but we see a modest increase at 2.0% this year, then accelerating to 2.2% in 2016.

As always, the figures for advanced economies in general mask diverse prospects across individual countries.
Major commodity producers, notably Canada but also Australia and Norway, are experiencing slowdowns. Along with the fall in real incomes due to poorer terms of trade, there are also negative investment effects in the commodity-producing sectors, which have proved a significant headwind to growth even in the US.

But the downward trend in commodity prices, which, as I have noted, has accelerated recently, is having its most dramatic effects in the emerging and developing commodity exporters. For this group of countries – that now represents well over half of world GDP and will still generate the lion’s share of world growth – 2015 growth is projected to fall to 4.0% from its 2014 level of 4.6%. This rate of growth is much lower than what we saw in the recovery from the Global Crisis, and represents the fifth straight year of falling GDP growth for emerging and developing economies.

Of course, while commodities are a big part of the story, they are not the whole story: in some cases, political instability could be a bigger factor, or an overhang of debt after capital inflows and over-investment earlier this decade.

We project a rebound for next year, with 4.5% growth in emerging and developing economies, and a further pickup in subsequent years. This rebound mostly reflects an expected gradual normalisation of conditions in countries experiencing especially deep recessions this year – such as Brazil and Russia – as well as in some other economies that are currently growing much below trend, including in Latin America.

Future risks to emerging and low-income countries

To be sure, many emerging markets have increased their resilience to external shocks with increased exchange rate flexibility, higher foreign exchange reserves, increased reliance on foreign direct investment flows and domestic-currency external financing, and generally stronger policy frameworks.

That being said, we have recently become more worried about potential downside risks that may threaten this recovery – all the more so because some countries have limited policy space to respond. The new releases of the Global Financial Stability Report and the Fiscal Monitor cover financial and fiscal risks in detail. But some obvious concerns stand out.

A notable risk is a rapid decompression of bond risk premiums, leading to spikes in longer-term interest rates.
Indeed, we have already seen some of this increase for some emerging and developing economies, especially commodity exporters.

Exchange rate depreciation has generally been a helpful buffer for emerging and developing countries experiencing growth slowdowns – and has already been substantial – but could cause adverse balance-sheet effects where there is foreign currency borrowing. Some countries have proactively tightened monetary policy to keep inflation expectations well anchored.

Banks in Greece will not open on Monday as officials scrambled to prevent the country's financial system from collapsing in panic.
Account holders will face tough limits on what they can withdraw from ATMs, and the stock exchange will reportedly be shut.
The curbs on banking imposed by Greece on Sunday are known as capital controls, which are used only at times of extreme stress in a banking system. Greek officials said that banks will stay shut until July 6, and that daily withdrawals would be limited to 60 euros, or about $67. The country's banks have been bleeding billions of euros for months, even before the country's debt crisis took a dramatic turn for the worse this weekend, leading to long lines at ATMs in Athens. Tourists should still have access to cash. Visitors are not subject to the capital controls, and debt and credit cards issued abroad should function normally. Greece faces a critical deadline on Tuesday, when it must make a loan payment to the IMF. The country looks almost certain to default on that payment.

https://www.youtube.com/watch?v=NEDom-rE-O8

IMF Prepares For Greece Default, Russia And The BRICS Bank Ask Greece To Join - Episode 664 Check Out The New X22 Report Spotlight YouTube Channel – https://www.youtube.com/channel/UC1rnp-CySclyhxyjA4f14WQ Get economic collapse news throughout the d...

To be precise, it has four days to accept the conditions creditors have attached to more bailout cash, or risk a financial crisis that could force it out of the eurozone.
Greece needs to find 1.54 billion euros ($1.7 billion) to pay the International Monetary Fund by June 30 to avoid default. To do that, it needs the last tranche of its 240 billion euro ($262 billion) bailout. But the 7.2 billion euros will only be released if the anti-austerity government agrees to economic reforms, something it has resisted since February. A series of meetings over the past week have failed to reach a breakthrough, and the IMF walked away from the talks last week.
Eurozone finance ministers will try again on Thursday but the omens are not good, and if a deal is further delayed, there may not be enough time to implement it before the end of the month