PPCC. PIsitófilos Creditófagos. Verano 2020

[Maloserá]

Un artículo de Hans-Werner Sinn, presidente del IFO alemán de 1997 a 2016, actualmente asesor del Ministerio de Economía alemán.

The Euro Crisis’s New Clothes
MUNICH – Jul 24, 2020 - HANS-WERNER SINN

The European Union's new €750 billion recovery fund is intended to tackle crises such as collapsing manufacturing output in southern member states like Spain and Italy. But money cannot solve the problem of distorted relative goods prices within the eurozone

https://www.project-syndicate.org/commentary/european-union-recovery-fund-will-not-make-italy-spain-competitive-by-hans-werner-sinn-2020-07?utm_source=Project+Syndicate+Newsletter&utm_campaign=4b4f31e542-covid_newsletter_30_07_2020&utm_medium=email&utm_term=0_73bad5b7d8-4b4f31e542-105693509&mc_cid=4b4f31e542&mc_eid=663724af14

European Union leaders have reached agreement on a big €750 billion ($870 billion) recovery fund intended to help the EU member states hit hardest by COVID-19. But during the lengthy negotiations over the package, it became increasingly clear that Europe’s pandemic-induced economic crisis is an extension of the euro crisis that has been festering since the collapse of Lehman Brothers in 2008.

In essence, this is a competitiveness crisis brought about by the distortion of relative prices within the eurozone, which is a result of inflationary overpricing in Southern European countries. This overpricing, in turn, stemmed from the flood of capital that entered these economies after they joined the euro.

The collapse of the euro bubble following the 2008 financial crisis reversed the direction of private capital flows, leading to several rounds of intense capital flight from the Mediterranean region to Germany. This was reflected in a surge in the so-called TARGET balances that measure net payment orders and provide a sort of public overdraft credit within the eurozone. And now COVID-19 has triggered another phase of capital flight that eclipses all the others.

After the pandemic struck earlier this year, international lenders refused to roll over their outstanding loans to Southern European countries and demanded repayment, subsequently investing the money in the eurozone’s northern members, particularly Germany. Southern European investors also shifted their investments to Germany, and transferred corresponding amounts of money. These two streams of payment orders have forced the Bundesbank to tolerate open credit positions so far amounting to €1 trillion.

In March 2020, German TARGET claims increased by €114 billion – by far the biggest monthly rise since the euro’s introduction in 1999. Capital flight during two previous high points of the euro crisis, in September 2011 and March 2012, also caused Germany’s TARGET balance to spike, but by only €59 billion and €69 billion, respectively. Although capital markets cooled off slightly in April and May of this year, German TARGET claims increased again in June, this time by €84 billion. Between February and June, they rose by a total of €174 billion, to reach a record-high €995 billion.

Conversely, Italian and Spanish TARGET debts increased by €152 billion and €84 billion, respectively, during the same period. That implied debts of €537 billion and €462 billion, respectively, at the end of June – or €999 billion in total. Both this figure and the German claims number are so close to the €1 trillion threshold that one cannot help but wonder what secret forces in the background might have pulled the emergency brake.

Investors fled Spain and Italy because they no longer viewed these countries as safe bets. And the two countries’ central banks made their flight possible by providing extra liquidity via national printing presses.

Part of this liquidity came from the European Central Bank’s various asset-purchase schemes, including the Pandemic Emergency Purchase Program (PEPP) and the long-established Asset Purchase Program (APP), which the ECB has increased temporarily in response to the current crisis. Although these programs had envisaged symmetrical asset purchases by the ECB and all national central banks in the eurozone, these institutions bought a disproportionately large volume of Italian assets.

The additional liquidity also comes from a special Targeted Longer-Term Refinancing Operations (TLTROs) program worth more than €500 billion that the ECB made available to eurozone banks in mid-June. The -1% interest rate on the TLTROs was extremely favorable – so favorable, in fact, that many banks borrowed the money and immediately redeposited it with their own central banks at a rate of -0.5%. This provided them with an immediate arbitrage gain that amounted to an open subsidy by the Eurosystem.

But Spanish and Italian banks needed the TLTROs in large part to compensate for the capital outflows. Or perhaps they used them simply to pay off private foreign loans that had less favorable terms. In that case, the loans that the Spanish and Italian central banks provided via their national (electronic) printing presses would not only have enabled capital flight, but also served as a means of driving private capital away by offering better terms.

Be that as it may, the eurozone remains internally unbalanced. This also becomes apparent if one looks at manufacturing output in Southern Europe. Unlike domestic sectors, the region’s manufacturers must compete internationally, and therefore have suffered the most from high relative prices. Even before the coronavirus crisis, manufacturing output in Italy was 19% below its level in the autumn of 2007, just before the real economy reacted to the financial crisis; in Spain, it was 21% lower. The downward trend has continued during the pandemic, widening the output gaps to 35% and 34%, respectively.

The new EU recovery fund is meant to address this fiasco, but money cannot solve the problem of distorted relative goods prices within the eurozone. Fixing it requires an open or real devaluation. But no one wants to talk about that. Instead, the EU’s strategy seems to be based on hope and prayer.

[senslev]

A ver si algún experto en la materia puede comentar lo que significa. Pero parece que la única salida que ofrecen es más ladrillo, supongo que el resto de actividades estarán enterradas en trámites burocráticos.

https://www.abc.es/espana/madrid/abci-comunidad-modifica-ley-suelo-para-suprimir-licencias-y-liberalizar-sector-202007291520_noticia.html

Más corrupción, más de lo mismo, qué puto asco.

[PopArt]

In essence, this is a competitiveness crisis brought about by the distortion of relative prices within the eurozone, which is a result of inflationary overpricing in Southern European countries. This overpricing, in turn, stemmed from the flood of capital that entered these economies after they joined the euro.

Artículo interesantísimo. Aunque este señor no puede estar hablando desde un punto de vista imparcial o crítico, viniendo de donde viene y asesorando a quien asesora. Está lanzando un mensaje: quiere que nos devaluemos, sólo nosotros.

Este mismo fenómeno está ocurriendo en diferido en los países del este de Europa: Hungría, Polonia, República Checa, Eslovaquia, Rumanía. Totalmente dominados por Alemania y su industria, en especial los tres primeros. ¿Por qué no se devalúan ellos también? ¿Y Alemania no tiene nada que devaluar?

Sería bueno saber exactamente a qué "bienes" se refiere cuando dice que están sobrevalorados 

Estoy de acuerdo en el análisis, y es impresionante ver cómo el dinero entra y sale de España según conviene al "ortograma". La conclusión de que los países del sur se tienen que devaluar... ahí ya podríamos tener una amigable conversación.

[saturno]

Quiénes son los "destructores de hogares" que se hicieron millonarios en EE.UU. (y cómo llegaron a la Casa Blanca)
https://www.bbc.com/mundo/noticias-53522031

Éste de javi2 (gracias) --- de lectura obligada

Y éste de Derby (gracias que ya no se sabe cómo darlas)

https://www.reuters.com/article/usa-housing-evictions/u-s-renters-owe-21-5-billion-in-back-rent-republicans-offer-no-eviction-relief-idUSL2N2F029X


The unprecedented amount of back rent is not a macro-economic game changer, said Moody’s Analytics Chief Economist Mark Zandi. But for renters, “it’s catastrophic. Very few people will be able to pay this back,” he said.

A debt spiral could haunt displaced tenants “for a lifetime,” he added.

Over the spring and early summer, as unemployment surged to levels unseen since the aftermath of the 1930s Great Depression, a patchwork of federal, state and local eviction bans kept renters in their homes.

Resumiendo (pienso en mi fase III, cuando después del rebrote, vienen las SOCIMIS se dedican a recomprar las maulas por 20K +  títulos de papel con "balor" de 300K +  la promesa de que podrán revender por más cuando vuelva a ir para arriba.)


-- BlackStone y los Caciques de los  Consejeros de la Casa Blanca van a completar la constitución de un parque de viviendas proto-"sociales" a partir de las viviendas de proto-desahuciados propietarios o de caseros-AirBeneberos en negative equity.

-- Trump, tiene 4 meses para montar un plan de salvamento de los cornucopianos venidos a menos, tomando como referencia a Roosevelt, eliminando la discriminación de la época, y salir reelegido con aclamaciones,

Si lo hace, saldrá reelegido, Que se hunda el SP500/Nasdag antes o después ya da lo mismo, Habremos entrado en pleno New House Deal.

Además de lo que cuenta el link de Javi2, recuerden que Trump es un macarra de New York que se hico rico (su padre) desde su juventud haciendo de super-capataz para levantar los edificios de viviendas obreras del Bronx. Para él, será como volver a sus origenes, Seguro que se toma una foto comiendo con obreros sentados en una viga bailando en el cielo, para marcar época,

Probablemente lo hará hasta bien.

(Y si no sale reelegido, pues no sé si BlackStone y los caciques que ahora campan a sus anchas en la Casa Blanca se lo pondrán tan fácil a los Demócratas, pero me temo que los Demócratas tendrán que tragar, no veo qué otra salida hay: no creo que vayan a alquilar las aceras para montar tiendas de campaña. Casi mejor lo hará la pandilla de Trump y sus amigotes).

[Vipamo]

In essence, this is a competitiveness crisis brought about by the distortion of relative prices within the eurozone, which is a result of inflationary overpricing in Southern European countries. This overpricing, in turn, stemmed from the flood of capital that entered these economies after they joined the euro.

 ¿Por qué no se devalúan ellos también? ¿Y Alemania no tiene nada que devaluar?

De entrada los tres no tienen EUR.

[Derby]

https://www.reuters.com/article/eastman-kodak-stocks/kodak-rally-builds-after-surprise-u-s-pharma-deal-idUSL3N2F13Y1

Kodak rally builds after surprise U.S. pharma deal

https://twitter.com/biochemyst1/status/1288703278499471360

PALM BEACH – Acknowledging that “he knows how bad this looks,” a good friend of the Trump family said today that his purchase of $20 million in Kodak shares just prior to the government’s announcement of funding was a coincidence related to his sudden, absorbing passion for classic film photography. Gene Salazar, a Mar-a-Lago member and regular golfing partner of the president, said that the mood to buy millions worth of Kodak stock shortly before it shot up 300% “just struck him early this morning” while he was out walking and definitely not receiving a private call from Donald Trump Jr. regarding the administration’s planned move. “I mean honestly,” he said, “If you told me that Donnie would, completely out of nowhere, throw three-quarters of a billion dollars at Kodak to produce drugs, I wouldn’t have believed you anyway.”

[Derby]

https://www.marketwatch.com/story/economy-suffers-titanic-329-plunge-in-2nd-quarter-gdp-shows-and-points-to-drawn-out-recovery-2020-07-30

Economy suffers titanic 32.9% plunge in 2nd quarter, GDP shows, and points to drawn-out recovery

Coronavirus triggers steepest recession since World War Two

The numbers: An economy badly battered by the coronavirus shrank at a record 32.9% annual pace in the second quarter, underscoring just how big a hole the U.S. finds itself in as it labors to recover from the deepest recession in American history.

The tidal wave of damage from the first global pandemic in a century was almost as bad as Wall Street expected. Analysts polled by MarketWatch had forecast a whopping 35% decline in gross domestic product, the official scorecard of the U.S. economy.

The economy began to recover in mid-May after a severe contraction at the beginning of the quarter, but the U.S. faces a long road back, analysts say. Millions of Americans are still out of work, thousands of businesses have closed and many of those that remain open have had to scale back operations because of tepid demand or ongoing government restrictions.

The recent surge in coronavirus cases in about half the states, especially large ones such as Texas, Florida and California, has also dealt a blow to a fragile economic recovery.

Previously GDP had never shrunk by more than 10% in any quarter since the government began keeping track shortly after World War Two.

What happened: Consumer spending, the main engine of the economy, contracted by a record 34.6% annual clip in the spring.

The decline was especially sharp in services T— travel, tourism, medical care, eating out and the like. Businesses that rely on large groups of customers and heavy store traffic bore the brunt of government lockdowns after the pandemic erupted. Spending on services nosedived 43.5%.

Households also spent far less on goods, though the decline wasn’t quite as steep. Purchases dropped 11.3%. Americans bought more groceries and other household staples with many working from home, but sales of clothing, gasoline and many other goods all fell sharply.

Business investment also stumbled badly as companies froze or slashed spending. Outlays on infrastructure such as oil rigs sank 35% while spending on equipment shrank by 37.7%. Both are record declines.

Investment in new housing also shriveled up by 38.7%, but it appears to have sprung back quickly. Record low mortgage rates have spawned a rash of new home sales and spurred builders to step up construction toward the end of the quarter.

The level of inventories also shrank by a whopping $234.6 billion annual rate in the second quarter, compared to an $80 billion dropoff in the first quarter.

Companies cut back on production as sales slumped and exports tumbled. That’s also weighed heavily on the economy, though production has picked up in the last few months after the economy largely reopened.

Government spending was a mixed bag. The federal government stepped in with massive infusions of aid for businesses, households and the unemployed, but states and localities have suffered a big drop in tax revenue even as expenses soared.

Overall government outlays edged up 2.7% in the spring. Federal spending jumped more than 17%, offsetting a 5.6% decline in state and local outlays.

Trade was a smaller drag on the economy. Exports dwindled by 64% in the second quarter, topping a 53% drop in imports. The coronavirus caused massive disruptions in the flow of global trade and a worldwide slump resulted in far less demand.

It may be months if not years before trade fully recovers, economists say, especially with the U.S. and China still at loggerheads on a number of issues. The two countries have the world’s largest economies.

The rate of inflation, meanwhile, fell at a 1.9% pace in the second quarter. The cost of many goods and services have fallen as companies cut prices to try to drum up sales. Inflation is likely to remain low until the pandemic fades.

Looking back at the first quarter, the originally reported 5% drop in GDP was unchanged. The pandemic struck in early March and tore a huge hole the economy in the final month of the quarter.

Big picture: The economy is primed to expand in the third quarter, but the surge in coronavirus cases has already taken some air out of the recovery. Economists polled by MarketWatch predict GDP will expand 18% from July to September, though estimates are likely to be ratcheted down.

The path of the recovery depends heavily on whether Congress passes another massive relief package, economists say, and whether the virus is brought under control again. Prolonged uncertainty will only cause Americans to save more and spend less and hurt the economy.

What they are saying?: “The virus is the boss,” said corporate economist Robert Frick of Navy Federal Credit Union. “The longer this goes on, the deeper the damage.”

Market reaction: The Dow Jones Industrial Average DJIA, +0.60% and S&P 500 index SPX, +1.24% were set to open lower in Thursday trades. Stocks have traded in a narrow range for the past few weeks.

[Maloserá]

Artículo interesantísimo. Aunque este señor no puede estar hablando desde un punto de vista imparcial o crítico, viniendo de donde viene y asesorando a quien asesora. Está lanzando un mensaje: quiere que nos devaluemos, sólo nosotros.

Interesantísimo sin duda. Y aquí tenemos a Hans, barba luterana, mochila y a andar en el campo.
Es la primera foto que encontre de él en una actividad de ocio. No prueba nada, pero lo dice todo.

[Derby]

Trump pide retrasar las elecciones presidenciales de 2020

https://www.bbc.com/news/world-us-canada-53597975

Donald Trump calls for delay to 2020 US presidential election

Donald Trump has called for November's presidential election to be postponed, saying increased postal voting could lead to fraud and inaccurate results.

He suggested a delay until people can "properly, securely and safely" vote.

There is little evidence to support Mr Trump's claims but he has long railed against mail-in voting which he has said would be susceptible to fraud

US states want to make postal voting easier due to public health concerns over the coronavirus pandemic.

In a tweet, Mr Trump said "universal mail-in voting" would make November's vote the "most inaccurate and fraudulent election in history" and a "great embarrassment to the USA".

https://www.cnbc.com/2020/07/30/trump-suggests-delaying-election-amid-fraud-claims-but-has-no-power-to-do-so.html

Trump suggests delaying election amid fraud claims, but has no power to do so

(...) Trump has no power to unilaterally delay elections, which were set for the first Tuesday in November through a mid-19th century law passed by Congress. Since then, it has never changed, said presidential historian Michael Beschloss.

[Derby]

https://www.cnbc.com/2020/07/30/weekly-jobless-claims.html

U.S. weekly jobless claims rise for a second straight week, total 1.434 million

[Maloserá]

Trump pide retrasar las elecciones presidenciales de 2020...

Está preparando el terreno para su momento Chávez. Esto si que sería un evento.
Hace unos días había leído este artículo y me pareció ciencia ficción. Ahora ya no.

https://www.theguardian.com/commentisfree/2020/jul/27/trump-loses-election-what-happens-possibilities

...
The problem begins – but does not end – with Donald Trump, who, in his recent interview with Chris Wallace, once again reminded the nation that losing is not an option. He will reject any election that results in his loss, claiming it to be rigged. Alarming as this may be, Trump alone cannot crash the system. Instead, an unusual constellation of forces – the need to rely heavily on mail-in ballots because of the Covid-19 pandemic; the political divisions in the key swing states of Michigan, Wisconsin and Pennsylvania; and a hyper-polarized Congress – all work together to turn Trump’s defiance into a crisis of historic proportions....

[Cadavre Exquis]

https://twitter.com/matthewbennett/status/1288825347945959425

Saludos.

[Derby]

Trump pide retrasar las elecciones presidenciales de 2020...

Está preparando el terreno para su momento Chávez.

Trump ya empieza a tener claro que su reelección peligra (que bien que le viene el coronavirus). Los datos de hoy de paro, hundimiento del pib, fallecidos por el covid; son francamente malos. Debe pensar que si le dan un par de meses más, lo conseguirá...

[Derby]

https://news.sky.com/story/china-says-uk-has-poisoned-relations-and-will-pay-the-price-if-it-shuns-beijing-12039070

China says UK has 'poisoned' relations and will 'pay the price' if it shuns Beijing

Liu Xiaoming cautions Britain against allowing "Cold War warriors" - a reference to Trump's White House - to further damage links.

China's ambassador to London has accused the UK of "seriously poisoning" relations between the countries - and warned it would "pay the price" if it shunned Beijing.

(...) condemned the decision to exclude Huawei from the UK's 5G network, and warned the UK not to interfere in Chinese internal affairs over Hong Kong.

"These actions have seriously poisoned the atmosphere of the China-UK relationship," he said.

"China respects UK sovereignty and has never interfered in the UK's internal affairs.


"It is important the UK will do the same - namely, respect China's sovereignty and stop interfering in Hong Kong's affairs, which are China's internal affairs, so as to avoid further damage to the China-UK relationship."

Mr Liu insisted his comments were intended to "threaten nobody".

"We just let you know the consequences," he said.

"People regard some of my remarks as threatening words. I think they quote my remarks out of context.

"But, if you do not want to be our partners and our friends, you want to treat China as a hostile country, you will pay the price.

"That means you will lose the benefits of treating China as opportunities, as friends. And you will bear the consequences of treating China as a hostile country."  (...)

[Derby]

https://www.cnbc.com/2020/07/30/volkswagen-posts-940-million-first-half-loss-and-cuts-dividend.html

Volkswagen posts $940 million first-half loss and cuts dividend as pandemic hammers sales

Volkswagen has reported an operating loss of 800 million euros ($940 million) for the first half of 2020 and cut its dividend as the coronavirus pandemic hammered car sales.

This compares to a profit of 10 billion euros for the same period last year. Group sales fell by 23.2% while deliveries plunged 27.4% year-on-year, with the percentage gap to last year’s performance falling consistently since May as worldwide shutdowns caused demand to crater.