After growth beat expectations, are we too pessimistic about the Eurozone’s chances? November 16, 2014 Christian Schulz is senior economist at Berenberg, says Yes. Remember early October? We’d just learned that German industrial output, factory orders and exports had plummeted in August by the biggest margins since Lehman. Alarm bells rang from Frankfurt to Washington. The reality is less spectacular: Germany entered an economic rough patch. Russia’s aggression against Ukraine [...]
The Eurozone is not likely to survive its own Japanese-style lost decade November 13, 2014 BEFORE the fiscal and monetary stimulus of “Abenomics”, Japan was afflicted with a chronic economic sickness. Crippled by excess private sector savings, it fell into deflation in the 1990s, despite very low nominal interest rates. Today, it is often suggested that the Eurozone is experiencing a similar malaise. Prior to the autumn, the leaders of [...]
Slum finance: We can build a new asset class by housing the desperately poor November 13, 2014 THE LATEST forecasts for global population growth continue to surprise. The number of people on our planet is thought likely to reach 11bn, or even 12bn, by the end of the century. Africa’s population is set to quadruple to 4bn. There are huge reasons for optimism, not least because world hunger has continued to fall [...]
Talent shortages could be the greatest threat to our economic health November 13, 2014 THIS week brought some long-awaited good news for Britons’ pay packets, as ONS data showed that average wages have beaten inflation for the first time since 2009. The jobs market outlook is rosier than it has been for years, but we are now facing the great irony of recovery. Having waited so long for it, [...]
With the FA castigated by Fifa, is the World Cup bidding process fundamentally flawed? November 13, 2014 David Skelton is director of Renewal, an organisation dedicated to broadening the appeal of the Conservative Party, says Yes The World Cup is an incredible event, but it is presided over by an organisation that doesn’t work. Fifa is a bunch of plutocrats, as out of touch from the passionate fans of the game as [...]
Africa is thriving: Only foreign capital can plug its $11.4 trillion funding gap November 12, 2014 In the age of 24-hour news, local and international headlines are instantly accessible, and the “developing” label placed on many nations and regions is looking increasingly out of date. The massive global economic growth witnessed over the last century was largely the result of increased international money flows. Foreign investment is vital for countries looking [...]
Finance for terrorists: Why it’s proving so hard to choke off Islamic State November 12, 2014 Islamic State’s (IS) gruesome beheading videos thrust it onto the world stage and galvanised Western military intervention. But just as the group’s propaganda machine combines medieval barbarism with the very modern power of social media, so its finances combine old-fashioned looting and pillaging with high-tech illicit funding. By many estimates, IS is now the richest [...]
As the Bank of England predicts low inflation for longer, is real wage growth here to stay? November 12, 2014 Rob Wood is chief UK economist at Berenberg Bank, says Yes. Real wage growth is here to stay, but it’s important to keep some perspective. We are finally seeing wages rise above inflation, partly because petrol and food price falls have dragged the latter down. Money wage growth remains weak, if better than a few [...]
Politicians must pledge action on airport expansion now – and end 40 years of failure November 11, 2014 The Airports Commission launched its public consultation on the three listed options for airports expansion yesterday. This follows the Commission’s clear recommendation that London and the South East needs one additional runway by 2030. Given this critical milestone in the journey to getting a political decision to build a new runway, it’s worth taking stock [...]
Is Ed Miliband a rational economic person? Or is it all about narrative? November 11, 2014 THE LEADER of the Labour party has provided us with a very effective piece of forward guidance. Ed Miliband’s statement that he would bring in a mansion tax on properties worth more than £2m has already had a dramatic impact. The market for expensive properties in London has more or less ground to a halt, [...]