Dear everyone, this article is based on a questionable premise: that the dollar is about to head off on another bull run. We know this may not happen. Thanks, us. Read more
It seems more top-tier economists are coming around to the idea that robots and technology could be having a greater influence on the economy (and this crisis in particular) than previously appreciated. Paul Krugman being the latest.
But first a quick backgrounder on the debate so far (as tracked by us). Read more
For the benefit of all, George Magnus of UBS sums up the chief problem now facing China in one neat mathematically charged paragraph:
The maths are problematic. If investment is 50% of GDP and the growth rate falls from 15% to say, 5% per annum, consumption growth has to accelerate from about 8% to an unprecedented 12% per annum or so if the underlying GDP growth rate is to stay at 7.5%. You can do the maths of alternative scenarios at leisure, but the bottom line is that rebalancing requires investment to grow more slowly than GDP, and consumption significantly faster over an extended period of time. Otherwise the model isn’t changing.
George Magnus of UBS has a 29-pager out on Monday questioning if the Asian miracle may finally be over? FT Alphaville is still poring through the details, but couldn’t wait to bring you a substantial chunk of the note which is dedicated to the role of technology and its impact on Asian market dynamics.
We’ve noted on more than one occasion that economists may be missing a trick when it comes to how technology is changing the global economy. More so, that developments like 3D printing, could even pose a black-swan risk for Asia in their own right. Read more
Intesa Sanpaolo’s chief executive says he’ll use ECB funds to buy Italian bonds…
BBVA sells the first senior unsecured bond to be issued by a Spanish bank since October… (like Intesa a few weeks ago. Both with unusually short – 18-month – maturities, however) Read more
“At a certain stage of development, the material productive forces of society come into conflict with the existing relations of production or – this merely expresses the same thing in legal terms – with the property relations within this framework of which they have operated hitherto”.
So said Karl Marx in introducing ‘A Contribution to the Critique of Political Economy’, (1859) and so quotes UBS’ George Magnus, in introducing his latest missive. Read more
UBS senior economic adviser George Magnus addresses the issue of Washington’s budgetary crisis on Monday.
As he points out, to some there is a major fiscal imbalance that has to be addressed, but no crisis — while to others the US is bust and nothing short of an immediate downsizing will neutralise a looming austerity crisis. Read more
George Magnus’ most recent report on the upcoming global structural crisis to come is so good, we thought it was worth highlighting some additional extracts.
Consider, for instance, the charts below. According to the UBS senior economic adviser, these reflect the makings of a potential debt-trap in not one, but numerous over extended OECD governments the world over: Read more
UBS senior economic adviser George Magnus has laid his cards on the sovereign crisis table.
He, for one, does not think the European Union’s weekend rescue will be enough to resolve the situation or stop it from spiralling into a structural crisis for all large debtor nations in the industrialised world. Read more
Bear market rally or start of a bull market? It is the question everyone wants answered right now. But George Magnus, senior economic adviser and green shoot weed-whacker at UBS, is in no doubt as to the answer.
Writing in Thursday’s FT, he clinically dissects the bull case, concluding the rally will stall and reverse for a number of reasons. These include, Read more
“Recession’s end“, Bloomberg commentators included in their headlines on Wednesday night, while others noted that inventory reductions indicate that the economy is nearing a bottom. Green shoots, green shoots, green shoots, blah blah blah.
UBS’s senior economic adviser George Magnus is here to put an end to all this talk of plants, taking aim via his weed-whacking financial commentary this morning on banks, capital and what’s really needed to fix the financial system. Here are some excerpts: Read more
George Magnus, senior economic advisor at UBS and author, has opinions on a wide range of subjects. In recent months, he generated spirited debate with his book about the economic impact of aging populations (‘The Age of Aging‘, John Wiley & Sons).
Since the book’s publication last year, the further collapse of markets and indications of deepening economic crisis have only underlined Magnus’s points about supporting aging populations and the growing economic pressure of expanding longevity rates. Nice summary of some of the book’s key points here at Original Dissent. Read more
UBS’s senior economic adviser, George Magnus, has thrown his hat into the bank nationalisation ring.
Magnus, like many others, is starting to see an increasing likelihood of full-scale bank nationalisation. What’s more, he reckons it may be the best way of preventing a “bad recession” from descending into a “deflationary bust.” Read more
The current deleveraging in the market is bad. Worse though, is the inevitable household deleveraging yet to come.
In his latest research, George Magnus, senior adviser at UBS, argues that unfortunately all of the above is unavoidable. Policy should, as a result, focus on containment rather than reversal. He explains: Read more
Enough of this bullishness!
The London stock market may have been testing 6000 again on the FTSE 100 on Monday. Alleged bijou banks Alliance & Leicester and Bradford & Bingley might be takeover targets. And we are certain that at RBS, Sir Fred Goodwin is as cocksure as ever. Read more
Naked Capitalism has picked up on what seems to be the week’s trend: reversing position. An odd sign of the times, or perhaps specifically, of financial stress, Yves Smith says:
On Friday, we have Citigroup, which previously stated it wouldn’t take SIV assets on to their balance sheet, relenting and doing just that. The Fed makes a few hawkish noises but still delivers a rate cut. Henry Paulson, a believer in the lightly regulated form of capitalism, going through some interesting feats of legerdemain to present the Treasury’s various shore-up-the-markets initiatives as private sector efforts (in detail perhaps, but not in conception or spirit). Read more