iBankCoin
Home / World

World

European Markets and U.S. Futures Celebrate the Bailout of Portugal’s Largest Bank

“(Reuters) – European stocks rose on Monday and bond yields fell on a banking sector rebound after Portugal prevented the collapse of one of its biggest lenders and shares in the continent’s largest bank jumped in the wake of its latest earnings report.

This dovetailed with easing fears of higher U.S. interest rates following Friday’s U.S. employment report, and eclipsed growing geopolitical concerns over the Middle East and the effect of Western trade sanctions on Russia.

Lisbon on Sunday announced a near 5 billion-euro rescue of the country’s largest listed bank, Banco Espirito Santo, preventing it from collapsing and potentially destabilizing the banking sector regionwide.

“The market’s initial reaction is that it’s pretty reassuring to see Portugal moving quickly to rescue BES. Overall it eases systemic fears that had resurfaced last week,” Saxo Bank sales trader Andrea Tueni said.

On Monday, HSBC reported a larger-than-expected drop in profits, but investors looked instead to the bank’s attractive dividend yield and scooped up the shares, lifting them to a three-month high….”

Full article

Comments »

Where the World Stands

“Americans – living in a huge country which has never really been invaded, and as the sole superpower – are famous for being out-of-touch with how the rest of the world thinks.

So my fellow Americans will probably be surprised to learn that the U.S. is more or less the only country in the world which has a favorable view of Israel.

Specifically, a 2012 BBC poll found that the U.S. and Nigeria were the only countries of those polled in which the majority of people had favorable views of Israel:

But Nigeria swung negative in the 2013 BBC poll, leaving the U.S. alone of all countries polled:

Indeed, the 2013 poll shows that  Israel is the fourth least popular country in the world, trailing only Iran, Pakistan and North Korea:

Iran is once again the most negatively viewed country, with negative ratings climbing four points to 59%. Most people also give negative ratings to Pakistan (56%, up five points), North Korea (55%, up three points) and Israel (52%, up one point).

Israel Has Violated United Nations Resolutions More than Any Country In the World

Another measure of world opinion on Israel is that the United Nations has condemned Israel’s violence towards its neighbors again and again.

Haaretz noted in 2002:

Israel holds the record for ignoring United Nations Security Council resolutions, according to a study by San Francisco University political science professor Steven Zunes.

***

Israel leads the list. Since 1968, Israel has violated 32 resolutions that included condemnation or criticism of the governments’ policies and actions.

***

Zunes specifically avoided counting resolutions that are vague or unclear so that governments could claim different interpretations to the meaning of the resolutions. Thus, the famous UN Security Council resolutions 242 and 338 are not included in his study. He also did not count resolutions that only included condemnations. Instead, he focused on those that included specific calls for changes in the subject governments’ policies.

The resolutions Israel violated were either about its annexation of East Jerusalem or settlements in the territories. Israel also ignored UN Security Council resolutions that called for Israel to cease using harsh measures against the Palestinian population and to cease expelling Palestinians.

Pulitzer prize winning journalist Chris Hedges points out that Israel has broken nearly a hundred UN Security Council resolutions regarding Gaza alone.

Here is a brief sampling of UN Security Council resolutions against Israel:

Resolution 106: The Palestine Question (March 29, 1955) ‘condemns’ Israel for Gaza raid

Resolution 111: The Palestine Question (January 19, 1956) ” … ‘condemns’ Israel for raid on Syria that killed fifty-six people”

Resolution 127: The Palestine Question (January 22, 1958) ” … ‘recommends’ Israel suspends its ‘no-man’s zone’ in Jerusalem”.

Resolution 162: The Palestine Question (April 11, 1961) ” … ‘urges’ Israel to comply with UN decisions”

Resolution 171: The Palestine Question (April 9, 1962) ” … determines flagrant violations’ by Israel in its attack on Syria”

Resolution 228: The Palestine Question (November 25, 1966) ” … ‘censures’ Israel for its attack onSamu in the West Bank, then under Jordanian control”

Resolution 237: Six Day War (June 14, 1967) ” … ‘urges’ Israel to allow return of new 1967 Palestinian refugees”. and called on Israel to ensure the safety and welfare of inhabitants of areas where fighting had taken place

Resolution 248: (March 24, 1968) ” … ‘condemns’ Israel for its massive attack on Karameh in Jordan”

Resolution 256: (August 16, 1968) ” … ‘condemns’ Israeli raids on Jordan as ‘flagrant violation”

Resolution 258: (September 18, 1968) … expressed ‘concern’ with the welfare of the inhabitants of the Israeli-occupied territories, and requested a special representative to be sent to report on the implementation of Resolution 237, and that Israel cooperate

Resolution 259: (September 27, 1968) ” … ‘deplores’ Israel’s refusal to accept UN mission to probe occupation”

Resolution 262: (December 31, 1968) ” … ‘condemns’ Israel for attack on Beirut airport“

Resolution 265: (April 1, 1969) ” … ‘condemns’ Israel for air attacks on Salt“

Resolution 270: (August 26, 1969) ” … ‘condemns’ Israel for air attacks on villages in southern Lebanon”

Resolution 279: (May 12, 1970) “Demands the immediate withdrawal of all Israeli armed forces from Lebanese territory”

Resolution 280: (May 19, 1970) ” … ‘condemns’ Israeli’s attacks against Lebanon”

Resolution 285: (September 5, 1970) ” … ‘demands’ immediate Israeli withdrawal from Lebanon”

Resolution 298: (September 25, 1971) ” … ‘deplores’ Israel’s changing of the status of Jerusalem”

Resolution 316: (June 26, 1972) ” … ‘condemns’ Israel for repeated attacks on Lebanon”

Resolution 317: (July 21, 1972) ” … ‘deplores’ Israel’s refusal to release Arabs abducted in Lebanon”

Resolution 332: (April 21, 1973) ” … ‘condemns’ Israel’s repeated attacks against Lebanon”

Resolution 337: (August 15, 1973) ” … ‘condemns’ Israel for violating Lebanon’s sovereignty and territorial integrity and for the forcible diversion and seizure of a Lebanese airliner from Lebanon’s air space”

Resolution 347: (April 24, 1974)” … ‘condemns’ Israeli attacks on Lebanon”

Resolution 444: (January 19, 1979) ” … ‘deplores’ Israel’s lack of cooperation with UN peacekeeping forces”

Resolution 446 (March 22, 1979): ‘determines’ that Israeli settlements are a ‘serious obstruction’ to peace and calls on Israel to abide by the Fourth Geneva Convention”

Resolution 450: (June 14, 1979) ” … ‘calls’ on Israel to stop attacking Lebanon”.

Resolution 452: (July 20, 1979) … ‘calls’ on Israel to cease building settlements in occupied territories”

Resolution 465: (March 1, 1980) ” … ‘deplores’ Israel’s settlements and asks all member states not to assist Israel’s settlements program”

Resolution 467: (April 24, 1980) ” … ‘strongly deplores’ Israel’s military intervention in Lebanon”

Resolution 468: (May 8, 1980) ” … ‘calls’ on Israel to rescind illegal expulsions of two Palestinian mayors and a judge and to facilitate their return”

Resolution 469: (May 20, 1980) ” … ‘strongly deplores’ Israel’s failure to observe the council’s order not to deport Palestinians”

Resolution 471: (June 5, 1980) ” … ‘expresses deep concern’ at Israel’s failure to abide by the Fourth Geneva Convention”

Resolution 478 (August 20, 1980): ‘censures (Israel) in the strongest terms’ for its claim to Jerusalemin its ‘Basic Law’

Resolution 487: (June 19, 1981) ” … ‘strongly condemns’ Israel for its attack on Iraq’s nuclear facility”

Resolution 497 (December 17, 1981), decides that Israel’s annexation of Syria’s Golan Heights is ‘null and void’ and demands that Israel rescinds its decision forthwith

Resolution 501: (February 25, 1982) ” … ‘calls’ on Israel to stop attacks against Lebanon and withdraw its troops”.

Resolution 515: (July 29, 1982) ” … ‘demands’ that Israel lift its siege of Beirut and allow food supplies to be brought in”

Resolution 516 (August 1, 1982) demanded an immediate cessation of military activities in Lebanon, noting violations of the cease-fire in Beirut

Resolution 517: (August 4, 1982) ” … ‘censures’ Israel for failing to obey UN resolutions and demands that Israel withdraw its forces from Lebanon”.

Resolution 520: (September 17, 1982) ” … ‘condemns’ Israel’s attack into West Beirut”.

Resolution 573: (October 4, 1985) ” … ‘condemns’ Israel ‘vigorously’ for bombing Tunisia in attack on PLO headquarters

Resolution 592: (December 8, 1986) ” … ‘strongly deplores’ the killing of Palestinian students atBirzeit University by Israeli troops”

Resolution 605: (December 22, 1987) ” … ‘strongly deplores’ Israel’s policies and practices denying the human rights of Palestinians

Resolution 607: (January 5, 1988) ” … ‘calls’ on Israel not to deport Palestinians and strongly requests it to abide by the Fourth Geneva Convention

Resolution 608: (January 14, 1988) ” … ‘deeply regrets’ that Israel has defied the United Nations and deported Palestinian civilians”

Resolution 611: (April 25, 1988) “… condemned Israel’s assassination of Khalil al-Wazir as a ‘flagrant violation of the Charter

Resolution 636: (July 16, 989) ” … ‘deeply regrets’ Israeli deportation of Palestinian civilians

Resolution 641 (August 30, 1989): ” … ‘deplores’ Israel’s continuing deportation of Palestinians

Resolution 672 (October 12, 1990): ” … ‘condemns’ Israel for “violence against Palestinians” at the Haram al-Sharif/Temple Mount

Resolution 673 (October 24, 1990): ” … ‘deplores’ Israel’s refusal to cooperate with the United Nations

Resolution 681 (December 20, 1990): ” … ‘deplores’ Israel’s resumption of the deportation of Palestinians

Resolution 694 (May 24, 1991): ” … ‘deplores’ Israel’s deportation of Palestinians and calls on it to ensure their safe and immediate return

Resolution 726 (January 6. 1992): ” … ‘strongly condemns’ Israel’s deportation of Palestinians

Resolution 799 (December 18 , 1992): “. . . ‘strongly condemns’ Israel’s deportation of 413 Palestinians and calls for their immediate return

Resolution 904 (March 18, 1994): Cave of the Patriarchs massacre

Resolution 1322 (October 7, 2000) deplored Ariel Sharon‘s visit to the Temple Mount and the violence that followed

Resolution 1435 (September 24, 2002) demanded an end to Israeli measures in and aroundRamallah, and an Israeli withdrawal to positions held before September 2000

Resolution 1544 (May 19, 2004) “…‘calls on’ Israel to respect its obligations under international humanitarian law, and insists, in particular, on its obligation not to undertake demolition of homes contrary to that law”

Resolution 1860 (January 8, 2009) “…‘calls for’ an immediate, durable and fully respected ceasefire, leading to the full withdrawal of Israeli forces from Gaza; ‘calls for‘ the unimpeded provision and distribution throughout Gaza of humanitarian assistance, including of food, fuel and medical treatment”

Of course, America is the only country which consistently votes against such  resolutions:

Older, White American Males Are Virtually the Only People In the World Who Unconditionally Support Israel

Even with the United States, there are only certain groups which support Israel.

new poll by Pew this month shows that it is mainly Americans 50 years or older, males, conservatives and evangelicals who support Israel….”

Full article

Comments »

The IMF Warns of Shocks to Global Growth

“Sharply higher interest rates around the world could combine with weaker growth in emerging markets to slice as much as 2 percentage points off global growth in the next five years, the International Monetary Fund said on Tuesday.

In a report assessing how individual national policies could interact to undermine the world economy, the IMF also warned the conflict between Russia and Ukraine could reverberate to the rest of the region if sanctions against Russia escalate, hitting natural gas supplies to Europe and weakening European banks.

The resulting impact could prompt further gyrations in financial markets, in contrast to the recent period of market calm, the IMF said in its “spillovers” report.

Editor’s Note: New Warning – Stocks on Verge of Major Collapse

In its worst-case scenario, the IMF said the United States and United Kingdom could tighten monetary policy sooner than expected, leading to higher borrowing costs worldwide, even as key emerging market growth slows a further 0.5 percentage point over the next three years.

The two developments would reinforce each other, prompting slower growth and hurting in particular those emerging markets with large economic imbalances, such as Argentina, Brazil, Russia and Turkey.

As in past reports, the IMF said monetary tightening in rich nations would have limited negative impact on the rest of the world if it was well-communicated and prompted by better growth prospects. The impact could also be muted if higher U.S. and UK rates come as the euro zone and Japan continue monetary easing, though this “asynchronous” tightening could cause more global exchange rate volatility….”

Full article

Comments »

Do You Suffer from Learned Helplessness ?

“Why won’t America stand up for herself? Why is the country, once a country which possessed courage and conviction , now sitting idly while allowing itself to be taken to the slaughter without so much as a whimper?

The answer to the above question lies in the psychological concept known as “Learned Helplessness” as discovered by Martin Seligman.

 

“Learned helplessness” occurs when an animal is repeatedly subjected to an aversive stimulus that it cannot escape. Eventually, the animal will stop trying to avoid the stimulus and behave as if it is utterly helpless to change the situation. Even when opportunities to escape are presented, this learned helplessness will prevent any action

 

Learned Helplessness

 

seligman 2

 

Phase One

In the first phase of the learned helplessness experiment, Seligman placed a dog on an electrical grid, shocked the dog and noted that the dog would demonstrate the ability to escape the aversive stimulus.

Phase Two

In the second phase, the dog was barricaded on the grid and was unable to escape the painful shocks. Eventually the dog laid down and passively accepted the shock.

Phase Three…”

Full article

Comments »

Superpower for Hire

[youtube://http://www.youtube.com/watch?v=6LaSD8oFBZE#t=15 450 300]

Comments »

Why the Markets Ignore Geo Politics and Current Events

“LONDON (MarketWatch) — A plane carrying close on 300 innocent people gets shot down along one of the most sensitive borders in the world. Israel invades Gaza, reigniting the deepest wounds in the Middle East, and potentially sparking another regional conflict. A few hundred miles away, a militant insurgency threatens to turn Iraq into a full-blown terrorist state.

The world has not been short of things to worry about in the last week, or the news bulletins short on drama and conflict.

But how did the financial markets react? A few stocks got marked down, and goldGCZ4 +0.08%  made one of its reflex moves upwards. Yet on the whole, they barely registered any reaction. It was as if nothing of significance had happened.


Reuters

Israeli soldiers take position along a fence near the border with Gaza.

There is a message in that, and an interesting one.

The markets are no longer interested in what happens in the rest of the world. The days when geopolitics could impact the prices of stocks, bonds, commodities or currencies in any significant way have been consigned to the past.

There are two possible explanations for that: firstly that there are not any wars or revolutions any more that can dramatically change the outlook for the global economy; and secondly, that the markets are so pumped up by quantitative easing, and easy money from the central banks, that anything else that happens pales into triviality by comparison.

The truth is probably somewhere in between. Either way, investors can safely ignore war and politics from now on when they are structuring their portfolio.

The declining interest of the financial markets in what is happening around the world has been evident for some time. The Arab Spring that saw governments fall across the Middle East was probably the last set of uprisings to make any real impact, but even that was largely restricted to frontier indexes such as Egypt XX:DWEG +0.99%  , and they don’t count for a great deal in the greater scheme of things.

But it has been most noticeable this year. It is not as if the past few months have been short on drama….”

Full article

Comments »

Central Banks Say Stocks are in Full Retard Bubble Territory

“The Bank for International Settlements — the Swiss-based financial institution that acts as a counterparty to national central banks — has declared that stock markets are in a “euphoric” state and has urged central banks globally to begin tightening interest-rate policies now while economies are growing rather than wait for another recession, when it will be too late.

Those are scary words coming from a set of economists whose job it is to monitor how capable central banks are of responding to economic conditions with flexible monetary policy.

The subtext (and not so subtext) of BIS’s annual report is that, because many central banks have reduced interest rates to zero — the U.S. and Japan included — they are without weapons to boost the economy should another crisis hit. You can’t go lower than zero, basically.

These words from the BIS ought to terrify anyone who thought central banks were unprepared for the last recession in 2007, when U.S. interest rates were “high” at about 5.3%:

Financial markets are euphoric, but progress in strengthening banks’ balance sheets has been uneven and private debt keeps growing. Macroeconomic policy has little room for manoeuvre to deal with any untoward surprises that might be sprung, including a normal recession…..”

Full article

Comments »

The EU Sinks Its Claws Into Ukraine, Georgia, & Moldova

 

“BRUSSELS—The European Union and three of Russia’s neighbors signed sweeping trade-and-political agreements Friday, pushing the bloc’s influence eastward but potentially provoking fresh tensions with Moscow.

The deals with Ukraine, Georgia and Moldova, which lower trade barriers and promote democratic reforms, were years in the making but faced doubts recently as Moscow stepped up its opposition. Russia, which annexed Ukraine’s Crimea region in March, has said it might retaliate against the three countries by curtailing trade ties.

But EU leaders want to show they won’t let a newly aggressive Russia deter them from welcoming countries into the European orbit. Many nations on Russia’s periphery have become more eager to align with the EU as a way to protect themselves against potential Russian threats.

The leaders of Ukraine, Georgia and Moldova said Friday that the agreements are a pivotal step in aligning their countries permanently with Europe. Ukrainian President Petro Poroshenko stressed the rapid changes engulfing his country in recent months, including street protests and the previous government’s ouster, that led to this moment.

“What a great day—maybe the most important day for my country after independence day,” Mr. Poroshenko said as the heads of all 28 EU countries looked on. “It shows how dramatically things can change in a short time, if the will of the people is strong enough.”

But leaders of both sides warned of challenges ahead. EU officials stressed that the three countries must keep up their reforms. Mr. Poroshenko said the EU must stand by Ukraine as it goes through a tough transition in the face of Russian displeasure…..”

Full article 

Comments »

Euro-zone Manufacturing & Services Survey Signals a Weakening Economy

“Euro-area manufacturing and services activity weakened in June amid a further slowdown in France’s economy, underscoring the fragility of the recovery in the 18-nation region.

A Purchasing Managers Index for both industries slipped to 52.8 in June from 53.5, Markit Economics said today. That’s the 12th month the gauge has exceeded 50, the mark that signals expansion. Economists predicted a reading of 53.4, according to the median of 25 estimates in a Bloomberg News survey. A measure of Chinese manufacturing rose to a seven-month high.

The euro area is struggling to sustain a recovery that received a bleak assessment from the International Monetary Fund on June 20. Earlier this month, the European Central Bank introduced a negative deposit rate, announced targeted loans to stimulate lending and held out the prospect of asset purchases to stoke growth and inflation in the region.

“The pace of recovery is slowing down,” said Martin van Vliet, senior economist at ING Groep NV in Amsterdam. “The further weakening of the PMI vindicates the ECB’s recent decision to implement further monetary easing.”

The euro dropped 0.1 percent today and traded at $1.3582 at 10:55 a.m. Frankfurt time. The Stoxx Europe 600 Index is down 0.6 percent at 346.15.

Chinese Manufacturing

In China, a preliminary factory PMI from HSBC Holdings Plc and Markit rose to 50.8, exceeding the 49.7 median estimate of analysts surveyed by Bloomberg News, and a final reading of 49.4 in May.

The euro area’s manufacturing gauge fell to 51.9 in June after 52.2 in May, and the measure for services eased to 52.8 from 53.2.

“Hopefully the recent stimulus measures from the ECB will help revive growth again……”

Full article

Comments »

NATO Scrambles F-16 Jets Over Lithuania After Russian Warplanes Allegedly Enter Airspace

“The Ukraine conflict continues to simmer, with the conclusive presidential election perceived as a positive even as the fighting in the eastern part of the nation intensifies, but it is NATO member Lithuania where today’s action was, where according to the Lithuanian Defense Ministry,NATO sent two fighter jets from Estonia after Lithuania said Russian vessel disturbed civilian shipping in Baltic Sea, and two Russian warplanes flew over Lithuanian airspace.

According to Bloomberg citing the Lithuanian press release, a Lithuanian warship and helicopter also deployed…..”

Full article

Comments »

The Thai Army Tries to Restore Order and Push Reforms Through a Coup

“A few minutes before 6:00 a.m. ET, the Thai army interrupted all of local TV programming to announce it was assuming power.

It’s a military coup.

This comes two days after the military declared martial law.

By default, you might think this means chaos in the financial markets.

But judging by the markets subdued initial reaction, it doesn’t seem like that big of a risk event. The Thai baht weakened barely against the dollar (see chart). The news came minutes after Thailand’s stock market closed; the SET index climbed 0.16% today.

There’s at least two reasons why today’s news isn’t rocking markets. One, the country had already been in chaos. Months of anti-government protests had already left 28 people dead and saw the ouster of Prime Minister Yingluck Shinawatra….”

Full article

 

Comments »

China To Surpass USA As World’s Largest Economy This Year

“The US is on the brink of losing its status as the world’s largest economy, and is likely to slip behind China this year, sooner than widely anticipated, according to the world’s leading statistical agencies.

The US has been the global leader since overtaking the UK in 1872. Most economists previously thought China would pull ahead in 2019.

The figures, compiled by the International Comparison Program hosted by the World Bank, are the most authoritative estimates of what money can buy in different countries and are used by most public and private sector organisations, such as the International Monetary Fund. This is the first time they have been updated since 2005.

After extensive research on the prices of goods and services, the ICP concluded that money goes further in poorer countries than it previously thought, prompting it to increase the relative size of emerging market economies.

The estimates of the real cost of living, known as purchasing power parity or PPPs, are recognised as the best way to compare the size of economies rather than using volatile exchange rates, which rarely reflect the true cost of goods and services: on this measure the IMF put US GDP in 2012 at $16.2tn, and China’s at $8.2tn.

In 2005, the ICP thought China’s economy was less than half the size of the US, accounting for only 43 per cent of America’s total. Because of the new methodology – and the fact that China’s economy has grown much more quickly – the research placed China’s GDP at 87 per cent of the US in 2011.

For 2011, the report says: “The US remained the world’s largest economy, but it was closely followed by China when measured using PPPs.”

With the IMF expecting China’s economy to have grown 24 per cent between 2011 and 2014 while the US is expected to expand only 7.6 per cent, China is likely to overtake the US this year.

The figures revolutionise the picture of the world’s economic landscape, boosting the importance of large middle-income countries. India becomes the third-largest economy having previously been in tenth place. The size of its economy almost doubled from 19 per cent of the US in 2005 to 37 per cent in 2011.

Russia, Brazil, Indonesia and Mexico make the top 12 in the global table. In contrast, high costs and lower growth push the UK and Japan further behind the US than in the 2005 tables while Germany improved its relative position a little and Italy remained the same.

The findings will intensify arguments about control over global international organisations such as the World Bank and IMF….”

Full article

Comments »

On the Matter of Artificial Neural Networks

“Imagine a major city completely covered by a video surveillance system designed to monitor the every move of its citizens. Now imagine that the system is run by a fast-learning machine intelligence, that’s designed to spot crimes before they even happen. No, this isn’t the dystopian dream of a cyber-punk science fiction author, or the writers of TV show “Person of Interest”. This is Boston, on the US East Coast, and it could soon be many more cities around the world.

In the aftermath of the Boston Marathon Bombings in April of last year, as law enforcement and the world’s media struggled to make sense of the tragedy, the Boston Police Department contacted a company well-known for developing innovative and cutting-edge surveillance technology based on advanced artificial intelligence.

Behavioral Recognition Systems, Inc. (BRS Labs) is a software development company based out of a nondescript office block in Houston Texas, with the motto: “New World. New security.”

Headed by former Secret Service special agent John Frazzini, the company brings a crack team of security gurus to bear on its ambitious artificial intelligence projects. With the heavy traffic of Houston’s West Loop South Freeway churning out fumes and noise just outside, BRS Labs has developed one of the most advanced, and perhaps most sinister, surveillance platforms known to man.

Reason-based analysis

AISight (pronounced “eyesight”), works by using a particular form of reason-based analysis of video footage that promises to change the way humans conduct their surveillance of other humans.

Artificial intelligence is already in use across surveillance networks around the world. At high security sites like prisons, nuclear facilities or government agencies, it’s commonplace for security systems to set up a number of rules-based alerts for their video analytics. So if an object on the screen (a person, or a car, for instance) crosses a designated part of the scene, an alert is passed on to the human operator. The operator surveys the footage, and works out if further action needs to be taken.

This method of detecting suspicious behaviour has a number of drawbacks: it’s labour-intensive for the operators, each rule has to be programmed by a technician, and routinely generates more false positives than anything useful. What’s more, it means you can’t move the camera or change the environment without having to reprogram all your rules.

BRS Labs’ AISight is different because it doesn’t rely on a human programmer to tell it what behaviour is suspicious. It learns that all by itself.

The system enables a machine to monitor is environment, and build up a detailed profile of what can be considered “normal” behaviour. The AI can then determine what kind of behaviour is abnormal, without human pre-programing.

Artificial neural networks….”

Full article

Comments »

Despite Low Growth and Falling Import & Exports, China Says No Immediate Stimulus is Planned

“(Reuters) – Chinese Premier Li Keqiang ruled out major stimulus to fight short-term dips in growth, even as big falls in imports and exports data reinforced forecasts that the world’s second-largest economy has slowed notably at the start of 2014.

Li stressed on Thursday that job creation was the government’ policy priority, telling an investment forum on the southern island of Hainan that it did not matter if growth came in a little below the official target of 7.5 percent.

“We will not take, in response to momentary fluctuations in economic growth, short-term and forceful stimulus measures,” Li said in a speech.

“We will instead focus more on medium- to long-term healthy development.”

His comments are among the clearest yet on the government’s plans for the economy, which has rattled global investors this year with a surprisingly lackluster performance.

Trade data on Thursday showed exports unexpectedly fell for the second consecutive month in March, the worst showing in more than four years, while imports fell by the most in 13 months.

Exports fell 6.6 percent in March from a year earlier, following an 18.1 percent slide in February, and imports fell 11.3 percent, their weakest performance in 13 months.

Economists were most worried by the fall in imports, which was seen confirming weakness in manufacturing and consumer demand. Some of the fall in exports was attributed to figures early last year being inflated by fake invoices before a government crackdown around the middle of 2013…..”

Full article

Comments »

The Business Cycle Does Not Exist Anymore

“What does it mean to be the world’s reserve currency?

Everbank’s Chuck Butler sums it up nicely in the following quote:

“Remember, the country with the reserve currency gets to receive loans at discounted borrowing costs. Also, commodities are priced in the reserve currency, meaning central banks around the world must hold the currency in their reserves to facilitate trade.”

Furthermore,

“Trading nations need dollars to lubricate trading and as foreign exchange reserves that bolster the value of their own currency and provide the asset base for the expansion of credit within their own nation”

Many different currencies have held reserve status throughout history.

This is important to note because it goes to show that, just like everything else, reserve currency status doesn’t last forever.

 

At present, the US dollar is the world’s main reserve currency.

 

That status has been a gift for the US: it has allowed it to run a deficit in perpetuity.

 

But it has also been a curse:

“The demand for safe assets feeds tha t exorbitant privilege enjoyed by the United States. This contributes to a weakening of US policy discipline as the country tends to excessively rely on easy credit in normal times and very expansionary macroeconomic policies in times of crisis. The outcome is excessive US indebtedness. The corporate sector was in debt prior to the burst of the dot-com bubble in 2001; so were the household and financial sectors before the eruption of the sub-prime crisis in 2007-08; and the official sector is in debt today.”

Moving on.

Let’s assume for a moment that the US recovers, the dollar appreciates in value relative to other currencies, the trade deficit shrinks, and QE comes to end.

 

That all sounds good, right? Yes, but maybe not for other countries – specifically those with current account deficits.

The end of easy money and artificially low interest rates will not bode well for the emerging markets.

The “faulty five” – aka the “BI ITS” – Brazil, India, Indonesia, Turkey and South Africa are particularly vulnerable because they rely on external financing to operate.

A stronger USD has multiple negative implications for their economies.

Before we continue let’s introduce the idea of Triffin’s Dilemma.

 

And now for a bit of history…..”

Full article

Comments »

Central Banks Fret Over Too Little Inflation

“The rise in consumer prices slowed across the world’s largest economies in December, fueling concerns that too little inflation, rather than too much, could threaten the global economy’s fragile recovery.

The Organization for Economic Cooperation and Development Tuesday said the annual rate of inflation in its 34 developed-country members rose to 1.6% from 1.5% in November, while in the Group of 20 leading industrial and developing nations it fell to 2.9% from 3.0%.

Although up slightly, the low level of inflation across developed countries will worry central bankers, since many regard annual price rises of 2% as consistent with healthy economic growth. The rise in the inflation rate was driven by higher energy prices, while the core rate of inflation—excluding energy and food—was unchanged at 1.6%.

When inflation is low, companies, households and even governments have a harder time cutting their debt loads, a particular problem for a number of highly-indebted nations in the euro zone.

When prices start to fall, consumers can postpone purchases in the expectation that they will get better value for their money in the future. That can in turn weaken economic activity, and create further deflationary pressures. Following the difficulties Japan has experienced in getting out of its long period of deflation, central banks in other countries are anxious to avoid a similar struggle.

The threat of low inflation, and the possibility that prices may start to fall, is most pressing for the European Central Bank, whose governing council meets Thursday. Figures released last week showed consumer prices in the euro zone rose by 0.7% in the 12 months to January, a decline in the annual rate of inflation from 0.8% in December…..”

Full article

Comments »

Global PMI Data Turns in a Mixed Bag

“…….

China: Official PMI: 50.5 — down from 51 in December.
China: Non-manufacturing PMI: 53.4, down from 54.6 in December.
South Korea: HSBC Manufacturing PMI: 50.9 — up from 50.8 in December.
Indonesia: HSBC Manufacturing PMI: 51.0 — up from 50.9 in December.
India: HSBC Manufacturing PMI: 51.4, up from 50.7.
Russia: HSBC Manufacturing PMI: 48.0, down from 48.8.
Ireland: Investec Manufacturing PMI: 52.8, down from 53.5.
Netherlands: NEVI Manufacturing PMI: 54.8, down from 57.0
Poland: HSBC Manufacturing PMI: 55.4, up from 53.2.
Turkey: HSBC Manufacturing PMI: 52.7, down from 55.0
Spain: Markit Manufacturing PMI: 52.2, up from 50.8.
Czech Republic: HSBC Manufacturing PMI: 55.9.
Italy: Markit/ADACI Manufacturing PMI: 53.1, down from 53.3.
France: Markit Manufacturing PMI: 49.3, up from 47.0.
Germany: Markit/BME Manufacturing PMI: 56.5, up from 54.3.
Eurozone: Markit Manufacturing PMI: 54.0, up from 52.7.
Greece: Markit Manufacturing PMI: 51.2, up from 49.6.
UK: Markit/CIPS Manufacturing PMI: 56.7, down from 57.2.
Australia: Ai Group PMI — 5 a.m.
Brazil: HSBC Manufacturing PMI — 6 a.m.
U.S.: Markit Manufacturing PMI — 9 a.m.
Canada: RBC Manufacturing PMI — 9:30 a.m.
Global: JPMorgan Manufacturing PMI — 11 a.m.”

Full article

Comments »