IMF

IMF Chief: ‘Optimistic’ About U.S. Economy While Stronger Dollar, Higher Interest Rates ‘Worrying’

Yesterday I caught the following on the website of Agence France-Presse. AFP reported:

International Monetary Fund chief Christine Lagarde on Sunday voiced optimism for US economic growth under President Donald Trump but warned it could herald trouble for the rest of the world.

“From the little we know, and I will insist on the little we know, because this is really work in progress… but from the little we hear, we have reasons to be optimistic about economic growth in the United States,” Lagarde said at the annual World Government Summit in Dubai.

Lagarde predicted tax reform and more investment in infrastructure were both likely under Trump…

“Now that’s the good news,” said Lagarde. “The more worrying news, if you will, is that it will have consequences on the rest of the world, and we are seeing it.”

She highlighted the strength of the dollar against other currencies, predicting a hike in interest rates regulated by the Federal Reserve.

“That’s a tightening that will be difficult on the global economy and for which economies will have to prepare,” said Lagarde.

(Editor’s note: Bold added for emphasis)

Hmm. Could the Federal Reserve use Lagarde’s concern regarding higher U.S. interest rates making things “difficult” for the global economy as one reason not to raise rates next month?

The other weekend, Euro Pacific Capital CEO Peter Schiff claimed in his YouTube vlog:

The reason the Fed didn’t give a clue that it might be raising rates in March, is because it has no intention of doing so.

(Editor’s note: Bold added for emphasis)

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s note: A qualified professional should be consulted prior to making a financial decision based on material found in this weblog. If this recommended course of action is not pursued, then it must be understood that the decision is the reader’s and the reader’s alone. The creator/Editor of this blog is not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information contained herein.)

Source:

“IMF’s Lagarde ‘optimistic’ about U.S. economy.” Agence France-Presse. 12 Feb. 2017. (https://www.yahoo.com/news/imfs-lagarde-optimistic-us-economy-104123263.html) 13 Feb. 2017.

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Signs Of The Time, Part 110

The most sobering article I’ve read yet about the deteriorating state of affairs in Venezuela. From Hannah Dreier of the Associated Press yesterday:

Tebie Gonzalez and Ramiro Ramirez still have their sleek apartment, a fridge covered with souvenir magnets from vacations abroad, and closets full of name brand clothes. But they feel hunger drawing near.

So when the Venezuelan government opened the long-closed border with Colombia this weekend, the couple decided to drain what remained of the savings they put away before the country spun into economic crisis and stock up on food. They left their two young sons with relatives and joined more than 100,000 other Venezuelans trudging across what Colombian officials are calling a “humanitarian corridor” to buy as many basic goods as possible…

Some fear what’s taking place in the “socialist paradise” is coming to the United States. I sure as hell hope not, as the International Monetary Fund is predicting 1,600% inflation for the South American country next year.

Regrettably, I do think hyperinflation could be in the cards for us down the road.

“Signs Of A Coming Time”?

An insightful piece by Dreier, which you can read over on the ABC News website here.

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Tuesday, July 19th, 2016 Food, Inflation, Signs Of The Time, Socialism, South America Comments Off on Signs Of The Time, Part 110

IMF Issues Downward Revision To Global Growth Forecast

From the International Monetary Fund website Tuesday:

Global growth continues, but at a sluggish pace that leaves the world economy more exposed to risks, says the IMF’s latest World Economic Outlook (WEO).

The WEO forecasts global growth at 3.2 percent in 2016 and 3.5 percent in 2017, a downward revision of 0.2 percent and 0.1 percent, respectively, compared with the January 2016 Update (see table).

In a recent speech, IMF Managing Director Christine Lagarde warned that the recovery remains too slow, too fragile, with the risk that persistent low growth can have damaging effects on the social and political fabric of many countries…

“The recovery remains too slow, too fragile”

Funny. That’s not what I’m hearing out of Washington and the mainstream media these days.

The IMF added:

In the United States, expected growth this year is flat at 2.4 percent, with a modest uptick in 2017. Domestic demand will be supported by improving government finances and a stronger housing market that help offset the drag on net exports coming from a strong dollar and weaker manufacturing…

You can read more about the IMF’s latest global growth forecast here on their website.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Wednesday, April 13th, 2016 Currencies, Federal Reserve, Government, Housing, Mainstream Media, Manufacturing, Recovery Comments Off on IMF Issues Downward Revision To Global Growth Forecast

IMF Statement On Greece

The Greek sovereign debt crisis has now entered a new, more disturbing phase. From an International Monetary Fund press release Tuesday night:

Statement by the IMF on Greece
Press Release No.15/310
June 30, 2015

Mr. Gerry Rice, Director of Communications at the International Monetary Fund (IMF), made the following statement today regarding Greece’s financial obligations to the IMF due today:

I confirm that the SDR 1.2 billion repayment (about EUR 1.5 billion) due by Greece to the IMF today has not been received. We have informed our Executive Board that Greece is now in arrears and can only receive IMF financing once the arrears are cleared.

“I can also confirm that the IMF received a request today from the Greek authorities for an extension of Greece’s repayment obligation that fell due today, which will go to the IMF’s Executive Board in due course.”

(Editor’s note: Bold added for emphasis)

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Tuesday, June 30th, 2015 Debt Crisis, Defaults, Europe Comments Off on IMF Statement On Greece

China Overtakes U.S. As World’s Largest Economy

“The 19th century belonged to England, the 20th century belonged to the U.S., and the 21st century belongs to China. Invest accordingly.”

-Warren Buffett, famous American investor

Lost in all the mainstream media frenzy over protests/riots related to the deaths of Michael Brown and Eric Garner was the following from MarketWatch columnist Brett Arends this morning:

There’s no easy way to say this, so I’ll just say it: We’re no longer No. 1. Today, we’re No. 2. Yes, it’s official. The Chinese economy just overtook the United States economy to become the largest in the world. For the first time since Ulysses S. Grant was president, America is not the leading economic power on the planet

The International Monetary Fund recently released the latest numbers for the world economy. And when you measure national economic output in “real” terms of goods and services, China will this year produce $17.6 trillion — compared with $17.4 trillion for the U.S.A…

To put the numbers slightly differently, China now accounts for 16.5% of the global economy when measured in real purchasing-power terms, compared with 16.3% for the U.S.

(Editor’s note: Bold added for emphasis)

While this century may very well go down in history as being “China’s Century,” I suspect the nation of 1.36 billion people will suffer setbacks (some serious) not unlike America did in the years leading up to it becoming a superpower. Despite this, the Chinese look to be taking the baton from the U.S. as far as 21st century hegemony is concerned.


“Little Apple- 2014 Hot Song in China”
YouTube Video

You can read the rest of Arends’ piece on the MarketWatch website here.

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Thursday, December 4th, 2014 Asia, Hegemony, Mainstream Media Comments Off on China Overtakes U.S. As World’s Largest Economy

Retired BP Geologist Warns Global Oil Production Declining Over 4 Percent Annually

It’s been a long time since I last talked about peak oil production. Peak what? Yeah, the mainstream media would rather run stories about alternative energy and “unconventional” oil production, as if it will somehow make up for declining “conventional” oil production before we’re hit with another energy crunch.

I’ve been following this topic for close to a decade now. And some pretty informed individuals have deduced not only is the era of “cheap” crude oil gone, but global oil production is in the midst of a steady decline. Dr. Nafeez Ahmed wrote on The Guardian (UK) website on December 23:

A former British Petroleum (BP) geologist has warned that the age of cheap oil is long gone, bringing with it the danger of “continuous recession” and increased risk of conflict and hunger.

At a lecture on ‘Geohazards’ earlier this month as part of the postgraduate Natural Hazards for Insurers course at University College London (UCL), Dr. Richard G. Miller, who worked for BP from 1985 before retiring in 2008, said that official data from the International Energy Agency (IEA), US Energy Information Administration (EIA), International Monetary Fund (IMF), among other sources, showed that conventional oil had most likely peaked around 2008.

Dr. Miller critiqued the official industry line that global reserves will last 53 years at current rates of consumption, pointing out that “peaking is the result of declining production rates, not declining reserves.” Despite new discoveries and increasing reliance on unconventional oil and gas, 37 countries are already post-peak, and global oil production is declining at about 4.1% per year, or 3.5 million barrels a day (b/d) per year

(Editor’s note: Italics added for emphasis)

Dr. Miller, who used to prepare the annual BP in-house projections of future oil supply, not only agrees with the conservative conclusions of an earlier study by the government-funded UK Energy Research Centre (UKERC) which predicted “a sustained decline in global conventional production appears probable before 2030 and there is significant risk of this beginning before 2020,” but is dismissive of shale oil and gas preventing a decline in global oil production.

Dr. Ahmed wrote an incredibly insightful piece, which you should read in its entirety over at The Guardian website here, since this really isn’t on the radar of the American press despite EIA data showing it should be a concern.

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Thursday, January 9th, 2014 Commodities, Energy, Mainstream Media, Natural Resources, Recession Comments Off on Retired BP Geologist Warns Global Oil Production Declining Over 4 Percent Annually

Global Recession In 2013?

There’s increased talk this week about a possible global recession in 2013.

Andy Bruce wrote on the NBC News website this morning:

“Is the global economy heading into another recession? This is now becoming a genuine possibility, given events in recent months,” said Gerard Lyons, chief economist at Standard Chartered in London, in a research note.

“The inability of European politicians to address their problems suggests that uncertainty about the euro area will persist, with the periphery remaining in recession.”

(Editor’s note: Italics added for emphasis)

On Monday, Ian Talley wrote in the Wall Street Journal’s Real Time Economics blog:

There is a “non-negligible risk that the global economy will enter another recession in 2013,” the Institute of International Finance said Monday.

The IIF, an association of more than 400 of the world’s largest private banks and other financial firms, said a recession isn’t their baseline forecast. But the warning underscores a message in the IIF’s economic report that policy makers must act quickly to address budget and financial problems in Europe and the U.S. to avoid a return to a worldwide contraction.

(Editor’s note: Italics added for emphasis)

Even if a global recession doesn’t materialize next year, fallout from the 2008 financial crisis remains. According to a Reuters piece on CNBC.com this morning:

The world economy will take at least 10 years to emerge from the financial crisis that began in 2008, the International Monetary Fund’s Chief Economist Olivier Blanchard said in an interview published on Wednesday.

Blanchard told Hungarian website Portfolio.hu, in an interview conducted on September 18, that Germany would have to accept higher inflation and a real strengthening of its purchasing power as part of the solution to Europe’s problems.

But even though the focus was on Europe’s troubles now, he said, the United States also had a fiscal problem which it had to resolve.

“It’s not yet a lost decade… But it will surely take at least a decade from the beginning of the crisis for the world economy to get back to decent shape,” Blanchard said.

(Editor’s note: Italics added for emphasis)

2013 looks to be a real interesting year.

Sources:

Bruce, Andy. “Global slowdown ‘becoming a genuine possibility,’ as Europe, China decelerate further.” NBC News. 3 Oct. 2012. (http://economywatch.nbcnews.com/_news/2012/10/03/14199420-global-slowdown-becoming-a-genuine-possibility-as-europe-china-decelerate-further?lite). 3 Oct. 2012.

Talley, Ian. “Banks Group Notes Risk of Global Recession Next Year.” Real Time Economics. 1 Oct. 2012. (http://blogs.wsj.com/economics/2012/10/01/banks-group-notes-risk-of-global-recession-next-year/). 3 Oct. 2012.

“IMF Chief Economist Says Crisis Will Last a Decade.” Reuters. 3 Oct. 2012. (http://www.cnbc.com/id/49269025). 3 Oct. 2012.

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Wednesday, October 3rd, 2012 Europe, Inflation, Recession Comments Off on Global Recession In 2013?

IMF Sees Central Banks Boosting Gold Reserves As It Predicts Weaker Global Growth

Central banks around the world are still adding to their gold reserves. Francesca Freeman wrote on the MarketWatch website this afternoon:

The central banks of Turkey, Russia, Korea and Kazakhstan boosted their gold reserves in July, according to data from the International Monetary Fund.

According to IMF data, Turkey increased its holdings by 44.7 metric tons to 288.9 tons, Russia increased its holdings by 18.6 metric tons to 936.6 tons, Korea increased its holdings by 15.5 metric tons to 70 tons, and Kazakhstan increased its holdings by 1.4 metric tons to 103 tons.

And yesterday, the managing director of the International Monetary Fund, Christine Lagarde, discussed the international organization’s outlook for the global economy. Leslie Wroughton wrote on the Reuters website this morning:

The International Monetary Fund is set to cut its forecast for global growth next month with uncertainty over whether European policymakers will keep promises to address the euro zone crisis weighing on confidence, the head of the IMF said on Monday.

“We continue to project a gradual recovery, but global growth will likely be a bit weaker than we had anticipated even in July, and our forecast has trended downward over the last 12 months,” IMF Managing Director Christine Lagarde said.

In July, the IMF cut its global growth projection for 2013 to 3.9 percent but left its 2012 forecast at 3.5 percent.

Lagarde said the euro zone debt crisis posed the greatest risk to the world economy but that the U.S. fiscal cliff also presented a “serious threat.”

(Editor’s note: Italics added for emphasis)

Lagard also talked about countries other than the United States and from within the Eurozone. Wroughton added:

Lagarde said emerging market economies were now clearly slowing and there was “great concern” in poor countries about rising food prices and volatile commodity prices. There were also signs of growing frustrations with political transitions in the Middle East, she added.

Would that be the so-called “Arab Fall” she was talking about?

Sources:

Freeman, Francesca. “IMF: Turkey, Russia, Korea boosted gold reserves.” MarketWatch. 25 Sep. 2012. (http://www.marketwatch.com/story/imf-turkey-russia-korea-boosted-gold-reserves-2012-09-25?link=MW_latest_news). 25 Sep. 2012.

Wroughton, Leslie. “UPDATE 1-IMF chief sees shaky confidence denting global growth.” Reuters. 25 Sep. 2012. (http://in.reuters.com/article/2012/09/24/imf-lagarde-idINL1E8KOBWQ20120924). 25 Sep. 2012.

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Tuesday, September 25th, 2012 Asia, Banking, Commodities, Debt Crisis, Emerging Markets, Europe, Food, Middle East, Precious Metals, Recovery Comments Off on IMF Sees Central Banks Boosting Gold Reserves As It Predicts Weaker Global Growth

IMF’s Lagarde: U.S. Fiscal Cliff Is ‘Risk Number One’ To Global Economy

Washington policymakers have seen Europe’s ongoing sovereign debt crisis as a welcome distraction away from America’s financial woes. But Christine Lagarde, Managing Director of the International Monetary Fund, recently pointed out the danger our economic ills pose to the global economy. From MNI (a leading provider of global foreign exchange and fixed income markets news/intelligence) last Thursday:

The looming US fiscal cliff is the number one risk globally at present, followed by the Eurozone and then the threat of another oil price surge, IMF head Christine Lagarde says.

Lagarde, speaking at the Global Investment Conference here, said the Eurozone is clearly at the epicentre of the crisis right now but is far from the only risk at present.

Risk number one … is clearly the fiscal cliff in the United States of America, where the deficit and debt to GDP ratios are actually worse than in the Eurozone,” she said.

Although the US does not face the Eurozone’s challenge of trying to secure accords with a host of states, its legislators are also struggling to take action.

“There is great uncertainty as to how Congress is going to actually deal with this fiscal cliff,” she said.

(Editor’s note: Italics added for emphasis)

According to Reuters on Sunday, Congress will try to work something out concerning this “fiscal cliff”- after the November elections. From their website on July 29:

The U.S. Congress is unlikely to resolve looming tax and spending issues before the Nov. 6 elections, a top Senate Democrat said on Sunday, but lawmakers are working on a proposal to tackle the issue after the elections.

Dick Durbin, the No. 2 Democrat in the Senate, said a bipartisan group of eight lawmakers is in talks to develop a solution to the steep tax increases and spending cuts, known as a “fiscal cliff,” that take effect at the end of the year if no action is taken.

Stay tuned…

Sources:

“IMF Lagarde: US Fiscal Cliff Key Global Risk; Oil A Worry.” MNI. 26 July 2012. (https://mninews.deutsche-boerse.com/index.php/imf-lagarde-us-fiscal-cliff-key-global-risk-oil-worry?q=content/imf-lagarde-us-fiscal-cliff-key-global-risk-oil-worry). 1 Aug. 2012.

“Durbin: US ‘fiscal cliff’ solution unlikely before election.” Reuters. 29 July 2012. (http://www.reuters.com/article/2012/07/29/usa-congress-fiscalcliff-idUSL2E8IT1AZ20120729). 1 Aug. 2012.

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Wednesday, August 1st, 2012 Borrowing, Commodities, Debt Crisis, Deficits, Energy, Europe, Fiscal Policy, GDP, Government, Spending Comments Off on IMF’s Lagarde: U.S. Fiscal Cliff Is ‘Risk Number One’ To Global Economy

IMF, World Bank Warn Global Economy Has Entered Danger Zone

When the World Bank president said last week the world had entered a new economic danger zone, it grabbed my attention.

But when the chief economist of the IMF said today that the world economy had entered a dangerous new phase, I decided I better share their concerns with you.

Associated Press’ economic writer Christopher S. Rugaber reported this afternoon:

The world economy has entered a “dangerous new phase,” according to the chief economist of the International Monetary Fund. As a result, the international lending organization has sharply downgraded its economic outlook for the United States and Europe through the end of next year…

“The global economy has entered a dangerous new phase,” said Olivier Blanchard, the IMF’s chief economist. “The recovery has weakened considerably. Strong policies are needed to improve the outlook and reduce the risks.”

(Editor’s note: Italics added for emphasis)

Rugaber talked about the IMF’s outlook for the United States. He wrote:

The IMF expects the U.S. economy to grow just 1.5 percent this year and 1.8 percent in 2012. That’s down from its June forecast of 2.5 percent in 2011 and 2.7 percent next year…

Unemployment is likely to average 9 percent next year, the IMF’s report said, echoing a recent estimate by the Obama administration.

The concerns of the International Monetary Fund follow those voiced by the head of the World Bank last week. Reuters’ Lesley Wroughton wrote on September 14:

World Bank President Robert Zoellick said on Wednesday the world had entered a new economic danger zone and Europe, Japan and the United States all needed to make hard decisions to avoid dragging down the global economy.

“Unless Europe, Japan, and the United states can also face up to responsibilities they will drag down not only themselves, but the global economy,” Zoellick said in speech at George Washington University.

“They have procrastinated for too long on taking the difficult decisions, narrowing what choices are now left to a painful few,” he said ahead of meetings of the World Bank and International Monetary Fund next week…

“The time for muddling through is over,” Zoellick said. “If we do not get ahead of events; if we do not adapt to change; if we do not rise above short-term political tactics or recognize that with power comes responsibility, then we will drift in dangerous currents.”

(Editor’s note: Italics added for emphasis)

Disregard such warnings at your own peril.

Sources:

Rugaber, Christopher S. “IMF: World economy enters ‘dangerous new phase’.” Associated Press. 20 Sep. 2011. (http://news.yahoo.com/imf-world-economy-enters-dangerous-phase-142632262.html). 20 Sep. 2011.

Wroughton, Lesley. “UPDATE 3-World Bank chief says world economy in danger zone.” Reuters. 14 Sep. 2011. (http://www.reuters.com/article/2011/09/15/worldbank-zoellick-idUSS1E78D0XK20110915). 20 Sep. 2011.

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Tuesday, September 20th, 2011 Asia, Employment, Europe, Fiscal Policy, GDP Comments Off on IMF, World Bank Warn Global Economy Has Entered Danger Zone
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