[ECONOARMAGEDDON] TOMORROW WILL BE WORSE

[Falcon Analyst]

Argentina is busy dismantling itself again, in another soft coup

I believe we just failed a coup in Bolivia

[UAE Bird Expert]

[UAE Bird Expert]

Capital is on the march

Europe needs a bolder plan for capital markets

How will Europe fund the huge sums needed to invest in energy transition, digital infrastructure and defence? Despite a vast €33tn pool of savings, Europe has a plumbing problem. Its capital markets are under-developed, while its banking sector is insufficiently sized to handle the growing demands for capital expenditure. To address the investment conundrums, deeper capital markets are needed.

Yet despite multiple bazookas from the European Central Bank, growth in lending to companies in the region since 2014 has been less than half that of the US. The gap in economic performance between the two has long nagged at Europe’s policymakers. A widening divide makes this angst acute.

“We need to mobilise private savings on an unprecedented scale, and far beyond what the banking system can provide,” former Italian prime minister and ECB president Mario Draghi argued ahead of publication of his upcoming report on enhancing Europe’s competitiveness.

There is a growing chorus of calls to dust off the unfinished plans for a capital markets union, led by ECB president Christine Lagarde. Recent heavyweight reports by former Italian Prime Minister Enrico Letta and former French central bank governor Christian Noyer also argue the case.

Revitalising securitisation is the place to start, enabling insurers and pension funds to support Europe’s growth. Securitisation allows banks to transfer assets to investors, in turn freeing up their own lending capacity. This is particularly important as banks provide the majority of credit to European small and mid-sized businesses, which account for almost two-thirds of jobs.

Rules written in response to the financial crisis harshly penalised securitisations and the European market for them has never really recovered. An unintended consequence is that banks have resorted to complex synthetic transfers of risk, which only the largest can undertake, thus holding back regional banks.

Solvency II, the rule book for insurers, makes it economically unappealing to fund a long-term infrastructure project or buy a package of small business loans too, reducing potential returns and limiting available financing.

It’s time to recalibrate securitisation rules to better reflect the true risk profile of assets, keep pace with evolving capital markets and encourage investment for European growth. Reforms to Solvency II rules are also essential, along with system-wide tweaks to the banking framework and financial market standards.

The venture capital ecosystem must be nurtured, private credit harnessed and the cumbersome sustainability rules for funds recalibrated.

Above all, Europe needs a more flexible and diversified financial market. If capital markets union plans fail to deliver it may result in lower growth. It’s time to call in the plumbers.

[UAE Bird Expert]

BBC:

economy."
handout Stephen Lemelinhandout
Stephen Lemelin, a Michigan Democrat, says his grocery bill is getting lower

Analysts say it is clear that the economy is important to voters, but less clear it will prove decisive in the November election.

In 2022, when inflation was at its worst, Democrats did better than expected in mid-term elections, as concerns about abortion access drove supporters to the polls.

This time around, issues such as immigration and fitness for office are also top of many voters' minds, while economic trends appear to be moving in the right direction.

Grocery prices were up just 1% over the past 12 months, well within historic norms; and the cost of a few items, including rice, fish, apples, potatoes, and milk, has even come down a bit.

As major chains such as Target, Amazon and Walmart announce price cuts in recent weeks, there are signs the situation could continue to improve.

Some analysts also expect wages, which have increased but trailed the leap in overall prices, to finally catch up this year, providing further relief.

“We’re on the right track,” says Sarah Foster, who follows the economy for Bankrate.com. “Wage growth has slowed, price growth has slowed but, you know, prices are slowing at a much faster rate than wages.”

Stephen Lemelin, a 49-year-old father of two from Michigan, another electoral battleground, says he was pleasantly surprised by lower prices on a recent supermarket trip.

Whatever his concerns about the economy, the military veteran says his support for Mr Biden, who got his vote in 2020, has never been in doubt, given that he sees Trump as a threat to democracy.

“Nobody likes high interest rates or high inflation but that’s not under presidential control,” he says. “If you know politics, there’s really only one choice.”

[UAE Bird Expert]

Today, the Villages isn’t so much a retirement community as an empire, a collection of dozens of neighborhoods covering more than 32 square miles spread over three counties, with the bulk in Sumter County. It boasts more than 60,000 households and is expanding. Fast. Dump trucks and excavators swarm the developing areas, and new buildings spring up practically overnight. Housing prices are out of control, gripe residents. (I checked out a lovely but modest home in the Village of Chitty Chatty that was priced around $460,000.) Thanks to the thousands of new Villagers who arrive each year, the Villages was the fastest growing metro area over the past decade.

[UAE Bird Expert]

[UAE Bird Expert]

Yes

[birdenjoyer]

This is relevant to these topics. Also a great read tbh Chat GPT is Bullshit

[cumshitter]

I hate these types of posts where people say businesses just "write off" things to cheat on their taxes.

Trashing their product requires labor and effort and is a legitimate business cost. Corporations are taxed on the difference between their expenses and their total revenue. Increasing their own costs by destroying product is a legitimate business expense to ensure price standards in the industry. And every employee involved in the process of destroying capital assets is taxed on their income from the job they're lucky to have, so it all evens out.

It's only a crime if they do it by planning with another producer, which is right and just. No judge would say you don't have the right to destroy your own property. You just can't plan to destroy things together to juke the market

[BrazenSolar]

I hate these types of posts where people say businesses just "write off" things to cheat on their taxes.

Trashing their product requires labor and effort and is a legitimate business cost. Corporations are taxed on the difference between their expenses and their total revenue. Increasing their own costs by destroying product is a legitimate business expense to ensure price standards in the industry. And every employee involved in the process of destroying capital assets is taxed on their income from the job they're lucky to have, so it all evens out.

It's only a crime if they do it by planning with another producer, which is right and just. No judge would say you don't have the right to destroy your own property. You just can't plan to destroy things together to juke the market

I believe most people disagree with the concept of price control (when it means wastage).

If your stuff isn't selling, lower your prices. Don't just destroy it. It seems to make obvious sense, and people have a kneejerk reaction to seeing food being destroyed when, as you say, a lot of labor and effort was put into the initial production of it.