Special Reports

Japan's Economy May be Struggling but its Debt is Sustainable
Published: 2/25/2010 1:09:10 PM By: Anna Fedec, contact@tradingeconomics.com

At the beginning of February, Standard & Poor’s downgraded Japan’s long-term outlook rating to negative. Yet, unlike Greece, which is also troubled by a rising national debt, the probability that Japan will default on its government bonds is pretty small.

Consumer Confidence in U.S. Falls
Published: 2/23/2010 10:38:02 AM By: TradingEconomics.com, Bloomberg

Confidence among U.S. consumers fell more than anticipated in February to the lowest level since April 2009 as the outlook for jobs diminished, a sign spending may be slow to gain traction as the economy recovers

Greece Needs Help but EU Bureaucracy May Be Fatal
Published: 2/17/2010 12:29:47 PM By: Anna Fedec, contact@tradingeconomics.com

It has been almost two months since S&P and Moody's downgraded Greece’s sovereign rating after it became clear that the Eurozone country may default on its government bonds. Yet, besides a guideline on how to solve the budget problems and a promise of support if things get out of control, the Euro Area members are not rushing to provide any financial help to its troubled pal. Moreover, many EU members seem to be underestimating the magnitude of problems in Greece which may prove to be a serious mistake in the months ahead.

Eurozone Gives Greece 30 Days to Show Good on Deficit
Published: 2/15/2010 7:07:34 PM By: TradingEconomics.com, Reuters

Euro zone states urged Greece on Monday to announce more deficit-control steps by mid-March if needed, but said nothing new of last week's pledge to defend the country if debt market pressures spin out of control.

EU Demands Greek Cuts in Bid to Uphold Euro Stability
Published: 2/11/2010 9:58:39 AM By: TradingEconomics.com, Bloomberg

European leaders ordered Greece to get the bloc’s highest budget deficit under control and said they were prepared to take “determined” action to staunch the worst crisis in the euro currency’s 11-year history.

Germany and France Will Not Let Greece Default
Published: 2/10/2010 7:52:34 PM By: Anna Fedec, contact@tradingeconomics.com

In 1997, the European Union established the Stability and Growth Pact. The main objective was to maintain fiscal discipline in countries adopting the Euro. However, very few envisioned that after a few years, Greece would be close to default on its debt and only a minority of EU members would be respecting the basic rules of the stability pact.

Quantitative Easing is Helping Wall Street Traders
Published: 12/9/2009 10:36:35 PM By: Anna Fedec, contact@tradingeconomics.com

Quantitative easing and other unconventional monetary policy measures did not have the positive results that many economists and politicians expected. In fact, it remains exceptionally difficult to get credit. However, it is indisputable that these measures of mass liquidity deployed by central bankers over the last 18 months are having a positive impact on investors' confidence judging by the recent performance of the world's stock markets. Still, the jury is still out and it may take years to assess the full influence of quantitative easing on the economy.

Debt Bubble May Hamper Global Recovery
Published: 12/3/2009 11:25:19 AM By: Anna Fedec, contact@tradingeconomics.com

Last week's announcement that Dubai World could no longer service its outstanding debt highlighted the fact the world economy remains fragile. Indeed, the burst of a debt bubble may be next in the line, after a series of devastating asset and housing bubbles.

A Weak US Dollar in Not in the Long-Term Interest of China
Published: 11/4/2009 11:14:39 AM By: Anna Fedec, contact@tradingeconomics.com

Since July 2008, China has kept the value of Yuan close to 6.82 per US dollar, oscillating around very narrow band. And like the dollar, the Renminbi has been falling against other currencies, not only undermining the reduction of global imbalances but also making exports from other countries less competitive against cheaper Chinese products.

Consumer Confidence in U.S. Unexpectedly Falls
Published: 10/27/2009 10:32:34 AM By: TradingEconomics.com, Bloomberg

Confidence among U.S. consumers unexpectedly fell in October for a second month as Americans fretted about a lack of jobs.

Global Recovery More Important Than Currency Intervention
Published: 10/23/2009 10:53:46 AM By: Anna Fedec, contact@tradingeconomics.com

Last week, Brazil announced the implementation of a 2% tax on capital inflows for fixed income and equities. Apparently, this decision was intended to prevent a bubble in the Bovespa and stop the Brazilian real for appreciating any further. However, although there is more and more discussion about the damaging effect of high/low exchange rates it is unlikely that any significant coordinated action will take place in the near future.

Group of 20 Agrees on Far-Reaching Economic Plan
Published: 9/26/2009 1:45:52 PM By: TradingEconomics.com, Bloomberg

Group of 20 leaders said they will crack down on risk-taking by banks and better align economic policies as they turned from crisis management to delivering a new set of rules for the world economy.

G20 Meeting Is Crowded With Conflicts of Interest
Published: 9/24/2009 4:25:28 PM By: Anna Fedec, contact@tradingeconomics.com

This week, leaders of the Group of 20 leading nations are meeting in Pittsburg. This meeting is happening the third time in less than a year and the agenda is expected to include calls for bigger financial markets regulations, global intervention to trim down trade imbalances and further discussion over protectionism. But with so many different interests in the same table will the major economies have the ability to solve some important issues?

A Trade War Between China and the US Will Damage Both Economies
Published: 9/16/2009 10:46:03 AM By: Anna Fedec, contact@tradingeconomics.com

Last week, President Barack Obama announced the United States would impose tariffs of up to 35% on tires from China. In response, Chinese government pledged dumping and subsidy probes of chicken and auto products from the US. However, regardless of which country is right or wrong, those protectionism moves are leaving both countries in very difficult position because by entailing trade restriction they can equally loose.

Government Spending May Lead US into a Double dip Recession
Published: 7/23/2009 12:17:45 PM By: Anna Fedec, contact@tradingeconomics.com

Government spending is rising day-by-day. The list includes: $787bn spent for the fiscal stimulus, at least $600bn for the TARP funding, unlimited resources for bank takeovers, loans to the financial institutions, and so on. But on the wake of declining tax revenues, how are those programs being financed? And more importantly, who is paying for it?

US Government Bailout (Update)
Published: 7/9/2009 8:07:30 PM By: Anna Fedec, contact@tradingeconomics.com

The lending capacity of the United States financial system has declined significantly over the last eighteen months as huge losses on loans and toxic securities have smashed capital in the financial sector. Hence, in a attempt to inject additional liquidity into the financial system, the U.S. Treasury along with the Federal Reserve has set out a series of programs to clean up the balance sheet of distressed financial institutions.

A Look to European Stimulus Plans
Published: 7/5/2009 12:29:34 PM By: Anna Fedec, contact@tradingeconomics.com

Since the beginning of the global financial crisis, European governments have been criticized for falling short of implementing a coordinated fiscal stimulus. However, although European countries have been slow in applying the stimulus packages, they haven’t stayed much behind the United States.

Public Debt May Rise To Unsustainable Levels
Published: 6/24/2009 4:58:33 PM By: Anna Fedec, contact@tradingeconomics.com

The term “too big to fail” has led to several bailouts and to an unprecedented increase in public debt. Indeed, the gross public debt of the ten richest countries in the world will grow by $9 trillion in the next three years reaching 106% of GDP, up from 78% in 2007, according to International Monetary Fund. More importantly, although there is little danger that countries will default on its bonds, it will take generations to pay for all this debt.

World Bank Cuts Forecast for Global Growth
Published: 6/22/2009 8:23:05 AM By: Tradingeconomics.com, Bloomberg

The World Bank said the global recession this year will be deeper than it predicted in March and warned that a flight of capital from developing nations will swell the ranks of the poor and the unemployed.

Government Bailouts and Weapons of Mass Liquidity
Published: 5/31/2009 1:55:48 PM By: Anna Fedec, contact@tradingeconomics.com

The lending capacity of the United States financial system has declined significantly over the last eighteen months as huge losses on loans and toxic securities have smashed capital in the financial sector. Hence, in a attempt to inject additional liquidity into the financial system, the U.S. Treasury along with the Federal Reserve has set out a series of programs to clean up the balance sheet of distressed financial institutions.

Comparing Stimulus Plans across the G20
Published: 5/31/2009 1:42:53 PM By: Anna Fedec, contact@tradingeconomics.com

With interest rates close to the zero, many countries have turned to fiscal stimulus to prevent their Gross Domestic Product from declining further. However, despite their common goal, some will fail, others will succeed.

The IMF Is Receiving an Upgrade. Will it Work?
Published: 4/28/2009 2:25:04 PM By: Anna Fedec, contact@tradingeconomics.com

Not a long time ago, many investors were questioning the need of the International Monetary Fund. However, with the worsening of the global financial crisis, the need for a lender of last resort has emerged, bringing the organization to the light again. But, will the IMF be able to help the world’s economy and is the institution really necessary for overseeing the global financial system?

U.S. Weapons of Mass Liquidity
Published: 4/21/2009 12:38:56 PM By: Anna Fedec, contact@tradingeconomics.com

The lending capacity of the United States financial system has declined significantly over the last eighteen months as huge losses on loans and toxic securities have smashed capital in the financial sector. Hence, in a attempt to inject additional liquidity into the financial system, the U.S. Treasury along with the Federal Reserve has set out a series of programs to clean up the balance sheet of distressed financial institutions.

G20 Agrees $1,100bn to Fight Crisis
Published: 4/2/2009 11:41:23 AM By: TradingEconomics.com, Financial Times

World leaders on Thursday agreed to “fight back” against the global recession with $1,100bn in funding for the International Monetary Fund, regional development banks and international trade finance, but did not commit themselves to a new round of fiscal stimulus.

Will the G20 Be Able to Fix the Global Economy?
Published: 3/25/2009 3:51:24 PM By: Anna Fedec, contact@tradingeconomics.com

On April 2, leaders from twenty of the world’s most advanced and emerging countries will meet in London to discuss a way to pull out the global economy out of the financial crisis. But has the so called G20 Group any ability and legitimacy to solve this difficult problem?

U.S. Treasury Announces $1 Trillion Toxic-Debt Plan
Published: 3/23/2009 5:53:12 AM By: TradingEconomics.com, Bloomberg

The U.S. Treasury announced a plan aimed at financing as much as $1 trillion in purchases of distressed assets to help a financial system that is “still working against recovery.”

Europe Unemployment at Two-Year High; Inflation Slows
Published: 2/27/2009 5:51:49 AM By: TradingEconomics.com, Bloomberg

European unemployment rose more than economists expected in January and inflation slowed, adding to arguments for the European Central Bank to cut interest rates more to revive the economy.

G-20 Calls for `Broad' Policy Action
Published: 11/15/2008 12:54:17 PM By: TradingEconomics.com, Bloomberg.com

World leaders agreed more must be done to shore up the global economy and improve regulation of financial markets, leaving details on how to do that to individual countries.

European Leaders Vow Bank Guarantees
Published: 10/12/2008 1:53:46 PM By: TradingEconomics.com, Bloomberg.com

European leaders agreed to guarantee bank borrowing and use government money to prevent big lenders from going under, trying to stop the financial hemorrhage and stave off a recession.

What to Expect This Week
Published: 9/20/2008 2:25:37 PM By: Anna Fedec

After an extraordinary week where the world's most important financial markets came close to a collapse, the week ahead is likely to bring some good news.

What to Expect This Week?
Published: 8/30/2008 1:52:51 PM By: TradingEconomics.com, contact@tradingeconomics.com

This week central banks decisions will take the center stage. The European Central Bank, the Bank of England, the Bank of Canada and the Reserve Bank of Australia are all expected to keep interest rates on hold.

What to Expect This Week?
Published: 8/23/2008 10:25:42 AM By: TradingEconomics.com

This week, housing data for the United States is likely to show that new home sales declined in July, home prices felt further but existing home sales went slightly up...

What to Expect This Week?
Published: 8/16/2008 1:49:14 PM By: TradingEconomics.com

This week will be very light in terms of economic releases. In the United States, despite the recent easing in energy and food prices producer price inflation is likely to grow further boosted by second round effects of high commodity prices.

What to expect this week?
Published: 8/2/2008 4:26:08 PM By: Trading Economics

This week, the market will be focus on the outcome of several central banks meetings. The United States Federal Reserve, European Central Bank, Bank of England and Reserve Bank of Australia are expected to keep rates unchanged due to signs of further economic slowdown.