PPCC: Pisitófilos Creditófagos. Primavera 2024

[Derby]

 https://www.bloomberg.com/news/articles/2024-04-30/beijing-further-loosens-home-buying-curbs-in-non-core-areas

Beijing Further Loosens Home Buying Curbs in Non-Core Areas

China’s capital city Beijing will allow families to buy one more home in non-core areas, as even the nation’s largest cities are buckling under the pressure of a record real estate downturn.

Households that reach current homeownership limits will be allowed to purchase another outside the fifth ring, according to a statement from the city’s housing commission.(...)

[Derby]

https://www.bloomberg.com/news/articles/2024-04-30/vanke-to-exit-non-core-business-divest-assets-for-liquidity

Vanke to Exit Non-Core Business, Divest Assets for Liquidity

Developer to focus on three main real estate businesses
Chairman Yu pledged to cut debt by half in five years

China Vanke Co. will exit non-core operations and divest assets as the developer seeks to boost liquidity amid the sector’s unprecedented downturn, according to a memo from a shareholder meeting on Tuesday.

The company will “trim down” and adjust its model for raising money, Chairman Yu Liang said in the meeting. It will also exit all businesses except for the three main operations, which focus on property development, real estate management services and rentals.(...)

[Derby]

https://www.ft.com/content/879f5de7-cd9b-4987-9c2b-8b23cf0f3800

China’s problem is excess savings, not too much capacity

Policymakers on either side of bitter trade dispute seem to confuse two issues

While China and its trade partners continue to clash bitterly over manufacturing overcapacity and global trade, much of the discussion seems to be occurring at cross purposes.

Excess Chinese capacity in targeted industrial sectors is one area of contention. Excess Chinese savings driven by the suppression of domestic demand is another issue. These two points of contention are very different but analysts and policymakers on either side seem to confuse the two.

In the former case, Beijing has targeted certain industries such as electric vehicles and solar panels that it believes to be strategically important, and has implemented policies that are designed to give Chinese producers in these sectors a long-term comparative advantage. There is nothing especially Chinese about this strategy. Most large economies also employ policies to support or protect favoured sectors.

As these policies work at the expense of foreign manufacturers, they often generate a great deal of outrage, but much of this reaction is self-serving. Comparative advantage, which is what drives the benefits of trade, implies that some countries are able to produce certain goods more efficiently than others. The purpose of trade, after all, is to concentrate production in those countries that have a comparative production advantage.

But comparative advantage is only realised in the exchange of goods, and not in their production. This is where the problem of excess Chinese savings emerges. China’s structurally-high domestic saving rate is the result of a decades-long development strategy in which income is effectively transferred from households to subsidise the supply side of the economy — the production of goods and services. As a result of these transfers, growth in household income has long lagged behind productivity growth, leaving Chinese households unable to consume much of what they produce.

Some of these subsidies are explicit but most are in the form of implicit and hidden transfers. These include directed credit, an undervalued currency, labour restrictions, weak social safety nets, and overinvestment in transportation infrastructure. These various policies automatically force up Chinese savings. By effectively exporting excess savings through the subsidy of the production of goods and services, China is able to externalise the resulting demand deficiency.

The fact that China dominates certain manufacturing sectors is perfectly consistent with free trade and comparative advantage. It is excess savings that creates a problem for the global economy — and it should be noted that many countries besides China engage in similar behaviour, including Germany and Japan. The problem is that these excess savings represent the suppression of domestic wages, and thus domestic demand, to achieve global competitiveness.

These are classic beggar-thy-neighbour trade policies in which unemployment — the consequence of deficient domestic demand — is exported by running trade surpluses. These surpluses must be absorbed by trade partners, usually in the form either of higher unemployment, higher fiscal deficits or higher household debt.

This is why the policy implications of the two points of contention are very different. The problem of excess savings can make the problem of excess capacity much worse. Trade-deficit countries seek to protect their economies from the excess saving of demand-deficient countries. This can be in the form of restrictions on trade or on capital inflows.

Beijing will no doubt continue to protect and support industries it deems to be strategically important, as will the US, the EU, and the rest of the world. This will lead inevitably to clashes, rising protectionism and widespread overcapacity in some sectors. In a well-functioning global trading system, countries produce goods in which they have a comparative production advantage, and then exchange them for goods in which they don’t. Thus the global economy is better off, even if individual sectors suffer.

When the purpose of exports, however, is to externalise the problem of weak domestic demand, the global economy can only be worse off, as John Maynard Keynes noted at Bretton Woods. The world must resolve the issue of excess savings and unbalanced trade, even as individual countries clash separately over excess capacity and comparative advantage.

[sudden and sharp]

La economía española crece un 0,7% en el primer trimestre de 2024 gracias al tirón del consumo y las exportaciones
https://elpais.com/economia/2024-04-30/la-economia-espanola-crece-un-07-en-el-primer-trimestre-de-2024-gracias-al-tiron-del-consumo-y-las-exportaciones.html
La inversión aumenta con fuerza en bienes de equipo, según los datos del Instituto Nacional de Estadística

[copo]

https://www.ft.com/content/879f5de7-cd9b-4987-9c2b-8b23cf0f3800

China’s problem is excess savings, not too much capacity

Policymakers on either side of bitter trade dispute seem to confuse two issues

While China and its trade partners continue to clash bitterly over manufacturing overcapacity and global trade, much of the discussion seems to be occurring at cross purposes.

Excess Chinese capacity in targeted industrial sectors is one area of contention. Excess Chinese savings driven by the suppression of domestic demand is another issue. These two points of contention are very different but analysts and policymakers on either side seem to confuse the two.

In the former case, Beijing has targeted certain industries such as electric vehicles and solar panels that it believes to be strategically important, and has implemented policies that are designed to give Chinese producers in these sectors a long-term comparative advantage. There is nothing especially Chinese about this strategy. Most large economies also employ policies to support or protect favoured sectors.

As these policies work at the expense of foreign manufacturers, they often generate a great deal of outrage, but much of this reaction is self-serving. Comparative advantage, which is what drives the benefits of trade, implies that some countries are able to produce certain goods more efficiently than others. The purpose of trade, after all, is to concentrate production in those countries that have a comparative production advantage.

But comparative advantage is only realised in the exchange of goods, and not in their production. This is where the problem of excess Chinese savings emerges. China’s structurally-high domestic saving rate is the result of a decades-long development strategy in which income is effectively transferred from households to subsidise the supply side of the economy — the production of goods and services. As a result of these transfers, growth in household income has long lagged behind productivity growth, leaving Chinese households unable to consume much of what they produce.

Some of these subsidies are explicit but most are in the form of implicit and hidden transfers. These include directed credit, an undervalued currency, labour restrictions, weak social safety nets, and overinvestment in transportation infrastructure. These various policies automatically force up Chinese savings. By effectively exporting excess savings through the subsidy of the production of goods and services, China is able to externalise the resulting demand deficiency.

The fact that China dominates certain manufacturing sectors is perfectly consistent with free trade and comparative advantage. It is excess savings that creates a problem for the global economy — and it should be noted that many countries besides China engage in similar behaviour, including Germany and Japan. The problem is that these excess savings represent the suppression of domestic wages, and thus domestic demand, to achieve global competitiveness.

These are classic beggar-thy-neighbour trade policies in which unemployment — the consequence of deficient domestic demand — is exported by running trade surpluses. These surpluses must be absorbed by trade partners, usually in the form either of higher unemployment, higher fiscal deficits or higher household debt.

This is why the policy implications of the two points of contention are very different. The problem of excess savings can make the problem of excess capacity much worse. Trade-deficit countries seek to protect their economies from the excess saving of demand-deficient countries. This can be in the form of restrictions on trade or on capital inflows.

Beijing will no doubt continue to protect and support industries it deems to be strategically important, as will the US, the EU, and the rest of the world. This will lead inevitably to clashes, rising protectionism and widespread overcapacity in some sectors. In a well-functioning global trading system, countries produce goods in which they have a comparative production advantage, and then exchange them for goods in which they don’t. Thus the global economy is better off, even if individual sectors suffer.

When the purpose of exports, however, is to externalise the problem of weak domestic demand, the global economy can only be worse off, as John Maynard Keynes noted at Bretton Woods. The world must resolve the issue of excess savings and unbalanced trade, even as individual countries clash separately over excess capacity and comparative advantage.

Muy buen artículo.

Thanks  Derby

[senslev]

https://www.vozpopuli.com/economia_y_finanzas/macroeconomia/alarma-espana-necesitaria-millones-extranjeros-pensiones.html

Alarma demográfica: España necesitaría 37 millones de extranjeros para mantener las pensiones, según el BdE.

Según el Banco de España, para que la tasa de dependencia se mantenga constante en los próximos 30 años, los extranjeros tendrían que aumentar tres veces más de lo previsto.

Pues listo, somos casi 50 millones, pongamos entonces que vamos a los 80-90 millones de personas, el metro cuadrado a un par de millones de la nueva cdbc.

[Zugzwang]

https://www.vozpopuli.com/economia_y_finanzas/macroeconomia/alarma-espana-necesitaria-millones-extranjeros-pensiones.html

Alarma demográfica: España necesitaría 37 millones de extranjeros para mantener las pensiones, según el BdE.

Según el Banco de España, para que la tasa de dependencia se mantenga constante en los próximos 30 años, los extranjeros tendrían que aumentar tres veces más de lo previsto.

Pues listo, somos casi 50 millones, pongamos entonces que vamos a los 80-90 millones de personas, el metro cuadrado a un par de millones de la nueva cdbc.

¿Y dónde van a trabajar? ¿De dónde va a salir el dinero para pagar su subsistencia?

Yo esto lo veo más que nada cortina de humo. Sí ya hay un problema para sostener un estado social en mínimos, y más con el despiece del sector primario que es el que absorbe gran parte de la mano de obra extranjera no cualificada. Yo veo más que nada un camino de escenarios futuros para tranquilizar a jubilados, herederos con viviendas y próximos a la jubilación, de ofrecer una solución realista al declive demográfico.

En mi periplo de alquiler de vivienda, he recibido dos vías de negociación y rebaja de dos pisos donde el casero se mostraba inflexible. Y parece que le ha molestado a las inmobiliarias cuando he dicho que ya tenía apaño. Negocian con fuerza porque se creen que al final bajarás los brazos y aceptarás. Bajar no bajan, pero vacío no lo quieren tener.

[Derby]

https://www.bloomberg.com/news/articles/2024-04-30/rogoff-says-markets-would-upend-political-bashing-of-the-fed

Rogoff Says Markets Will Thwart Any Political Pressure on Fed

Harvard economist cites fiscal policy impact in his calculus
Rogoff says there is some ‘reversion to the mean’ under way

Harvard University economics professor Kenneth Rogoff said that financial markets would effectively impose restraint on any move by a US president to force the Federal Reserve into easing monetary policy.

“If you take away Fed independence, investors are going to get jittery, inflation expectations are going to go up, the dollar’s going to tank,” Rogoff said on Bloomberg Television’s Wall Street Week with David Westin. “For better or for worse, maybe, I think markets will throw a pretty cold bucket of water on the president if he tries to do that.”

With the Fed for now pledging to keep interest rates at the highest level in decades, investors have been eyeing speculation that former President Donald Trump might seek to force policymakers into cutting their benchmark should he win November’s election. Rogoff noted that there are also progressive Democrats who have tried to pressure the Fed into easing.

“Almost no matter who’s in power, they’re looking for ways to try to loosen monetary policy,” Rogoff said. “The progressives have ideas for taking away Fed independence too. They’re not at the tip of the tongue of President Biden or Jared Bernstein and his advisers, but they are ideas floating out there.”

Bernstein, who heads President Joe Biden’s Council of Economic Advisers, last week highlighted the importance of shielding the Fed from politics. “I can spend a long time talking to you about economies that have been brought to their knees when the independence of the central bank has been compromised,” he said.

Rogoff, a former International Monetary Fund chief economist, also said that political influence will be difficult for the Fed to reject in its entirety.

Rate Outlook

“Of course the Fed’s heart is in the right place, but it’s hard to be an island of technocratic tranquility in the middle of a sea of political turmoil,” he said.

He also said he expects long-term interest rates to remain elevated for years to come. Ten-year Treasury yields are currently around 4.66%, compared with an average of 2.36% over the past decade.

“Long-term interest rates are probably higher for as far as the eye can see,” Rogoff said. “Even after the Fed unwinds its interest-rate hikes, I think they’re going to stay higher for a very long time.”

(Updates with further comments from Rogoff starting in fourth paragraph.)

[sudden and sharp]

Mare mía...   

Endeudarse en yenes baratos para invertir en activos de más riesgo ha sido un modus vivendi en el ya clásico carry trade del yen. Japón es, de facto, el mayor tenedor de bonos americanos. Ahora, si el banco nipón interviene para parar la depreciación del yen y evitar que la inflación se dispare, tendrá que apreciarlo comprando con dinero creado de la nada, ya que no creo que suban tipos por el efecto que tendrá en pago de intereses de la deuda.

Veremos, por otro lado, si deciden vender bonos estadounidenses, con los efectos que esto puede tener en su rendimiento y en los mercados financieros. La verdad es que todo esto es muy complejo y no acabará bien, y debe ser una señal de alerta para entender que la deuda es un tema principal que debe ser abordado por los países occidentales para evitar una japonización y estar en modelo “sostenibilidad de lo insostenible”.

Suhto o muehte. 




El dilema del Samurai
https://cincodias.elpais.com/mercados-financieros/2024-04-30/el-dilema-del-samurai.html

[asustadísimos]

[Estamos tan abrumados por la acumulación de noticias que se nos ha pasado que el BBVA va a absorber el Banco Sabadell.]

[Cadavre Exquis]

https://www.eleconomista.es/banca-finanzas/noticias/12793819/04/24/bbva-traslada-al-sabadell-su-interes-en-una-fusion.html

https://www.eleconomista.es/banca-finanzas/noticias/12794085/04/24/bbvasabadell-como-seria-el-banco-resultante-de-la-fusion.html

https://www.pressreader.com/spain/el-economista/20240501/page/8/textview

La valoración de TSB, riesgo de integración y la rentabilidad: las diferencias con 2020

https://www.pressreader.com/spain/el-economista/20240501/page/9/textview

El catalán genera capital para estar en posición compradora en vez de vender

Baile de sillas: el difícil y necesario “sacrificio” de parte de las cúpulas

https://www.eleconomista.es/mercados-cotizaciones/noticias/12793919/04/24/los-analistas-y-el-mercado-valoran-a-sabadell-en-9880-millones.html

https://www.pressreader.com/spain/el-economista/20240501/page/10/textview

La catalana sube un 3,4% y BBVA cae cerca de un 7%

Saludos.

[Cadavre Exquis]

https://www.eleconomista.es/banca-finanzas/noticias/12793497/04/24/la-gran-banca-gana-66768-millones-hasta-marzo-un-173-mas-y-marca-un-nuevo-record.html

Saludos.

[Cadavre Exquis]

https://www.eleconomista.es/banca-finanzas/noticias/12792924/04/24/santander-gana-2852-millones-hasta-marzo-un-11-mas-y-marca-nuevo-record-de-ingresos.html

Saludos.

[Cadavre Exquis]

https://www.eleconomista.es/banca-finanzas/noticias/12792918/04/24/caixabank-gana-1005-millones-un-175-mas-y-eleva-al-158-la-rentabilidad.html

Saludos.

[Cadavre Exquis]

https://www.eleconomista.es/energia/noticias/12794272/04/24/espana-arrasa-en-la-subasta-del-banco-europeo-del-hidrogeno.html

Saludos.