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Euro crisis and global downturn
Two latest forecasts, one by the UN and another by the IMF, warn of the threat of global downturn and recession in both 2012 and 2013. Unlike the IMF estimates of 3.3 per cent, the UN forecasts show that the growth will be 2.6 per cent only in the current year 2012. The previous forecasts of UN and the IMF for this year were 3.6 and 3.9 per cent respectively. Both predict growth in developed capitalist countries will be 1.2 to 1.3 per cent only amidst very high unemployment and extreme income inequality. They also reveal that countries like China and India will now face economic slow down which have been the locomotive of the global economy, especially since the financial crisis of 2008. These projections, however, do not assess the likely severe adverse effect of steep rise in the prices of petroleum products recently due to increased tensions in the Iranian Peninsula.
Nonetheless, there is broad consensus that despite abrupt withdrawal of fiscal stimulus and bail-outs playing some role in dampening the growth, the major culprit has been the Read more…
Europe on brink of recession, unemployment above 10%
BRUSSELS: Since the start of the year, one phrase has tripped off the lips of European leaders more than any other: “jobs and growth”. After two years of debt crisis and budget austerity, there is a strong desire to shift the narrative on.To that end, the EU’s first summit of 2012, to be held on Jan 30, will focus on finding ways to kickstart growth and create jobs across the 27-country union, which is on the brink of recession and has average unemployment of 10 percent, rising to 45 percent among the young in countries such as Spain.
The problem is that after years of preaching austerity and telling wayward governments to cut spending and raise revenue, there is scarce capital readily available for investment, either at a national level or across the EU budget.
As a result, there is little expectation that Monday’s summit will produce concrete measures to boost either output or employment in the near-term, despite EU leaders first adopting their competitiveness mantra more than a decade ago.
“They don’t have much of a strategy apart from the typical laundry list of structural and labour market reforms, which is fine, but that is Read more…
Global Stock Markets Drop Again on Economy Fears
Stock markets fell across the globe on Friday, as investors showed new concern about the struggling U.S. economy and the stability of the European banking system.
The three major U.S. stock indexes — the Dow Jones Industrial Average, S&P 500 and NASDAQ — all dropped more than one percent Friday, following their decline of four to five percent on Thursday.
Asian stock indexes dropped sharply Friday, and European markets retreated as well, although not as much as on Thursday.
Analysts said that fear had overtaken stock trading, with many investors worried that officials in Europe and the U.S. will not be able to solve vexing economic and government financing issues.
In Europe, the concern is that banks are not strong enough to handle the continent’s debt problem sweeping through its financially troubled governments. Investors are also worried that Read more…
World Bank Calls On Ghana To Check Population Growth
Masahudu Ankiilu Kunateh
Mr. Javed Talat, Executive Director of the World Bank on Monday called on the Ghana Government to fashion out mechanisms that would help check the ever-growing population to solve development challenges.
He said Technology was fast moving towards reductions in job creation such that unchecked population growth could become disastrous to developing countries in terms of high rates of unemployment.
Mr. Talat made this call when he led a World Bank delegation to visit Vice President John Dramani Mahama at the Castle, Osu.
He said the World Bank had a financial facility to support developing countries to check population growth and suggested to developing countries to adopt such measures in order to advance their economies.
Mr. Talat, who is on a visit to Ghana to assess the country’s performance as part of his economic constituency commended successive governments for stabilizing the country, adding “I want to congratulate all of the leaders of Ghana for maintaining peace and tranquility over the years and I must add that Ghana stands out as a country of progress with political stability.”
The Executive Director also appealed to developing Read more…
10 Signs That Economic Riots And Civil Unrest Inside The United States Are Now More Likely Than Ever
You should let the video footage of the wild violence that just took place in London burn into your memory because the same things are going to be happening all over the United States as the economy continues to crumble. We have raised an entire generation of young people with an “entitlement mentality”, but now the economy is producing very few good jobs that will actually enable our young people to work for what they feel they are entitled to. If you are under 30 in America today, things look really bleak. The vast majority of the good jobs are held by people that are older, and they aren’t about to give them up if they can help it. It is easy for the rest of us to tell young Americans to “take whatever they can”, but the reality is that there is intense competition for even the most basic jobs. For instance, McDonald’s recently held a “National Hiring Day” during which a million Americans applied for jobs. Only 6.2% of the applicants were hired. In the old days you could Read more…
Anarchy and Austerity: Why London Won’t Be the Last City to Burn
The Great Recession gave birth to a lost generation across the world, where youth unemployment rates stretch into the 20s, 30s and even 40s. Those millions have responded with violence.
REUTERS
The riots and fires consuming London are a story about senseless violence and crime. They are also a story about urban politics, race relations, education inequality, and British culture and society. But underneath all of that, they are part of an economic story that is universal.
For the last year, Great Britain has embraced austerity to a degree that would make some American conservatives blush. The purpose of shrinking government was to reduce debt. But the effect has been to kill the economy. With the UK tottering on the razor’s edge of recession, consumer confidence is at a record low, unemployment is rising, and even the Read more…
US stocks plunge, Dow falls more than 500 points
The Dow Jones Industrial Average plunged 4.3 percent Thursday, its worst one-day drop in more than two years, as global markets melted down over fears of another world economic downturn.
The Dow was down 512.76 points to 11,383.68; the broader S&P 500 lost 4.8 percent to 1,200.07, while the tech-heavy NASDAQ Composite plunged 5.1 percent to 2,556.39.
More turmoil over sovereign debt problems in Europe and feeble US economic data are stoking “fear that the economy is heading for a double-dip recession,” said Peter Cardillo of Rockwell Global Capital.
“The market is pricing that in,” he said.
Markets worldwide were on edge over fiscal weakness in Italy and Spain and the eurozone’s ability to contain more crisis, as the two countries’ borrowing costs surged in recent days.
Meanwhile the US Labor Department reported that weekly claims for unemployment benefits remained at a high 400,000 last week, as business and government layoffs persisted while new job creation remained sluggish.
All of the Dow’s 30 blue-chip stocks were hit by the sell-off, but losses were most pronounced in the basic materials sectors, energy and financial companies.
Unemployment rose in 90 percent of U.S. cities in June
Unemployment rates rose in more than 90 percent of U.S. cities in June, according to a report released Wednesday by the U.S. Department of Labor.
Unemployment rose in 345 large metro areas during the month, according to the report. Rates dropped in 20 cities, and remained steady in seven.
The national unemployment rate increased in June to 9.2 percent.
The statistics show a drastic change in unemployment rates in recent months. In May, unemployment rates rose in only 210 cities. In April, rates decreased in nearly all metro areas.
In June, employers added just 18,000 jobs, the lowest number in nine months. It was also a sharp decrease from the average of 215,000 jobs that were added in February, March, and April.
Many of the highest unemployment rates were seen in metro areas that are college towns. Champaign-Urbana, Ill., the home of the University of Illinois, saw its unemployment rate rise from 6.9 percent in May to 9.6 percent in June. College towns in Read more…
Brzezinski: Middle Class Unrest To Hit U.S.
Zbigniew Brzezinski, who forty years ago wrote of a highly controlled future society where the population would be subjugated by a technocratic elite, appeared on MSNBC’s Morning Joe yesterday to predict that middle class unrest caused by economic disenfranchisement would soon hit America.
“I don’t want to be a prophet of doom — and I don’t think we are approaching doom — but I think we’re going to slide into intensified social conflicts, social Read more…
NIA Releases U.S. Economic and Inflation Update
The official U.S. unemployment rate rose during the month of May to 9.1%, up from 9% in April, with only 54,000 non-farm jobs being created for the month. The real unemployment rate including short and long-term discouraged workers is now 22.3%. The Bureau of Labor Statistics (BLS) used the birth/death model to produce a positive monthly bias during the month of May of 206,000 jobs, up from 175,000 in April, 117,000 in March, and 112,000 in February. Without the birth/death model, 152,000 jobs were lost during the month of May.
By utilizing the birth/death model, the BLS is assuming that during the month of May, the number of new jobs created by start-up businesses were 206,000 greater than the number of jobs lost from companies going out of business. NIA finds this assumption to be Read more…
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