OMFIF

China cooling spreads beyond borders, Cyber resilience and financial stability

Commentary: China cooling spreads beyond borders

By Steve Hanke in Baltimore

The Shanghai Composite Index tumbled by more than 9% in October, and has shed 25% for the year. To determine the probability of a cool down, one must look at the money supply, broadly measured. The relationship between the growth rate of the money supply and nominal GDP is unambiguous and overwhelming. It is unsurprising that Chinese stock markets have been rattled. Moreover, as China has for some time been the biggest...

http://www.allaboutshipping.co.uk/2018/11/07/china-cooling-spreads-beyond-borders-cyber-resilience-and-financial-stability/

US faces twin deficit crisis, Roundtable with Donald Kohn

Commentary: US faces twin deficit crisis

By Desmond Lachman in Washington

The US trade deficit has widened steadily over the past two years, reaching a record high of almost $1tn annually. As a result of Washington’s expansive budget policy at this late stage in the economic cycle, analysts expect that over the next two years the US budget deficit will rise to a peace-time high of more than $1tn. This makes it probable that the US will face a twin deficit problem – an outsized budget deficit and...

http://www.allaboutshipping.co.uk/2018/11/05/us-faces-twin-deficit-crisis-roundtable-with-donald-kohn/

‘Incertitudes allemandes’ back again, Global trends in interest rates

Commentary: ‘Incertitudes allemandes’ back again

By David Marsh in Berlin

German instability is back again. Angela Merkel, presiding over the ruling Christian Democratic Union as chairman since 2000 and as chancellor since 2005, will step down from the party leadership in December. She protests that she will stay the course. A fight is brewing among the (at least) four disparate candidates for the party chair. The odds are shortening on her departing from the chancellorship well before general...

http://www.allaboutshipping.co.uk/2018/11/01/incertitudes-allemandes-back-again-global-trends-in-interest-rates/

The Bulletin: In good faith

November 2018 Vol.9 Ed.10
Islamic finance scales up

Thanks to the concentration of wealth in oil-rich economies and the development of harmonised regulatory standards, the Islamic finance market is more popular than ever. Islamic finance originally focused on the retail market, but now attracts mainstream investors. The industry boasts assets worth more than $2tn, and is expected to exceed $3tn by 2020.

This month’s Bulletin looks at this small but fast-growing and dynamic market, documenting its...

http://www.allaboutshipping.co.uk/2018/11/01/the-bulletin-in-good-faith/

Central banks greening financial system, Politics in the Middle East podcast

Commentary: Central banks greening financial system

By Danae Kyriakopoulou in Geneva

Central banks’ remits have changed profoundly since the 2008 financial crisis, notably – and sometimes controversially – in relation to their monetary policy practices and quantitative easing policies. Their remits are beginning to expand into another, unexpected field: climate change.

The recognition of climate-related disruption as a source of financial risk is propelling this expansion, and central banks can...

http://www.allaboutshipping.co.uk/2018/10/31/central-banks-greening-financial-system-politics-in-the-middle-east-podcast/

Ukraine’s thorny IMF relationship, Roundtable with Donald Kohn

Commentary: Ukraine’s thorny IMF relationship

By Mark Sobel in Washington

The IMF’s relationship with Ukraine has always been among its most high profile and difficult interactions. The US and Europe have consistently encouraged the IMF to remain engaged in Ukraine, viewing this as a means of laying a foundation for greater market orientation, integrating Ukraine with the West and diminishing Russia’s regional influence.

Though the Fund has spared no effort, the relationship cannot be viewed as a...

http://www.allaboutshipping.co.uk/2018/10/30/ukraines-thorny-imf-relationship-roundtable-with-donald-kohn/

Decision time for US deficit, OMFIF-IBM Central bank digital currency report

Commentary: Decision time for US deficit

By Seema Shah in London

US President Donald Trump must choose between a larger budget deficit or a smaller trade deficit. The US has so far managed to run up its debt without alarming the markets, thanks to the dollar’s unchallenged role as the world’s primary reserve currency.

However, there are concerns the economy is starting to overheat. In the wake of stronger than expected employment data and non-manufacturing sector activity, 10-year Treasury...

http://www.allaboutshipping.co.uk/2018/10/29/decision-time-for-us-deficit-omfif-ibm-central-bank-digital-currency-report/

No-deal Brexit threat to rich EU nations, Efficacy of macroprudential policies

Commentary: No-deal Brexit threat to rich EU nations

By David Owen in London

When examining the potential fallout from the two greatest risks facing European markets, a no-deal UK exit from the European Union and possible Italian contagion, the impact on EU supply chains and cross-border banking exposures is especially important to consider.

The EU regions that would be most impacted by a no-deal Brexit are richer and have lower unemployment rates, including southern Germany and the Netherlands.

Suc...

http://www.allaboutshipping.co.uk/2018/10/26/no-deal-brexit-threat-to-rich-eu-nations-efficacy-of-macroprudential-policies/

ECB capital key dilemma on reinvestment, Africa Financial Markets Index

Commentary: ECB capital key dilemma on reinvestment

By David Marsh and Ben Robinson in London

The ECB faces potential charges of discrimination from Italy over maintaining its quantitative easing programme next year. Technical changes in allocating reinvestment of national central banks’ maturing bond holdings in 2019 could exacerbate Italy’s dispute with the European Commission over Rome’s budgetary policy.

Potential squabbles centre on the quinquennial recalculation of the ECB’s ‘capital key’,...

http://www.allaboutshipping.co.uk/2018/10/23/ecb-capital-key-dilemma-on-reinvestment-africa-financial-markets-index/

Hedging inflation with gold, The future of the dollar

Commentary: Hedging inflation with gold

By Aimee Bowkett in London

Gold has fallen out of favour in financial markets, hitting a 19-month low in August. However, it is seen as a good hedge against rising inflation. Since the gold standard was dropped in 1971, no country has seen average inflation below 2% and only 28 have seen it average below 5%.

While the Fed reduces its balance sheet, gold could be particularly attractive as a safe haven against equity market crashes. Importantly though,...

http://www.allaboutshipping.co.uk/2018/10/18/hedging-inflation-with-gold-the-future-of-the-dollar/

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