Emerging Markets Archive

Leveraged loans, Current account and repatriation, Cass freight index

So for every agent that spent less than its income, another must have spent more than its income, or the output would not have been sold. It’s an ex poste identity for any currency. That means that as bank lending decelerated, assuming ‘savings desires’ are generally constant, either some other means of ...Read More

A few comments on overnight news

The threshold may be high but there is one somewhere up there: Fed should be ‘very patient’ in cutting stimulus: Rosengren (Reuters) The high number of part-time workers who would rather work full-time, the still-high unemployment rate, and very low inflation suggest significant “slack” in labor markets and “call for a very ...Read More

India Fiscal Position Weak as Elections Approach, Moody’s Says

With official unemployment around 9%? Unfortunately they listen to this nonsense and you can see the results :( India Fiscal Position Weak as Polls Approach, Moody’s Says ...Read More

The unconscious liberal

Macroeconomic Populism Returns By Paul Krugman February 1 (NYT) — Matthew Yglesias says what needs to be said about Argentina: theres no contradiction at all between saying that Argentina was right to follow heterodox policies in 2002, but it is wrong to be rejecting advice to curb deficits and control inflation now. ...Read More

Growing Pains

FLASH- Fed to taper another $10 billion Maybe they are concerned about all the interest income they are removing from the economy? ;) General comments: For GDP to grow at 3% all the pieces have to ‘average’ 3% growth And if anything is growing at a slower pace than last year, something ...Read More

Deficit maths redux- Faulty logic in 2014 GDP forecasts?

Pretty much all forecasters expect improvement in 2014 largely from what they call a reduction in fiscal drag. Their logic goes something like this (with the actual numbers varying a bit with different analysts): Without the deficit reduction in 2013 that subtracted 2% from growth, growth would have been 4%. Therefore, when ...Read More

Dallara Says Greek Euro Exit May Exceed 1 Trillion Euros

>    >    Apparently, MMT is a hard concept for the IIF to grasp. >    Yes! Incompetent disgrace. No reason an exit has to cost them anything in real terms. But because they believe otherwise they’ll work to keep Greece in. Dallara Says Greek Euro Exit May Exceed 1 Trillion Euros By Andrew ...Read More

ILO global unemployment report

They don’t need to ‘create jobs’ as there is already more to do than there are people to do it. They need to remove fiscal drag with tax cuts and/or spending increases to allow the needs to be funded: Sustained Global Unemployment: Interesting stats from the International Labor Organization noting that there ...Read More

Credit spillovers from Eur banks to EM

Makes sense. I always wondered how that loan demand was accommodated. Never looked like the kind of lending US regulators would sanction. Karim writes: Interesting table from JPM. Much larger dependence on credit from Eur banks for LATAM economies than from U.S. banks. Poland/Russia not as surprising but still large! Overall, domestic ...Read More

thoughts on the euro

So my story has been that while most thought QE was a bumper crop for the dollar- Fed printing money and flooding the system with liquidity and all that- It was in fact a crop failure for the dollar, as evidenced by the Fed turning over $79 billion in QE profits (that ...Read More