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Another Massively Interactive European Chart

  
Analysis, Economy, Education
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With all chart porn these days focusing on Europe, the Economist may have outdone itself with this combo set of all key financial and economic statistics for European countries.

Here is the caption provided by the Economist:

 
 

EUROPE is damned if it does and damned if it doesn’t, fiscally speaking. Fears that Greece’s debt crisis presage similar episodes elsewhere in the euro zone—notably in Portugal and Spain—have sent sovereign-bond yields for several southern European countries drifting higher, and have fuelled fears about the exposure of Europe’s banks to indebted governments. Attempts to rein in the public finances may calm bond markets but they also risk weakening growth, which makes life more difficult for exporters in places like China and America, and spells trouble of a different kind for the banks.

The interactive graphic above underlines some of the problems that the European economy faces. In 2009 only Poland of the 27 countries in the European Union managed to record positive growth. Although many countries have now returned to growth, it is generally anaemic. In many countries unemployment rates have not risen as much as you might expect given the depth of the crisis—there are times when making it hard to fire people has some advantages. But the flipside of labour-market rigidity is that the unemployment rate may be “sticky”, because firms have less need to hire as recovery takes hold. That will keep demand growth subdued.

Mediocre growth rates are more of a problem for some countries than others. They spell particular trouble for those that have high levels of debt and that do not have the option to devalue their currencies. That explains why Greece was first to lose the confidence of the markets: with a public-debt-to-GDP ratio of 115% and a budget deficit of 13.6% in 2009, it was the euro zone’s outlier country. Other countries are now scrambling to avoid Greece’s fate. Ireland, another heavily indebted euro-zone member, embarked on austerity early; Portugal and Spain, whose problems stem as much from levels of external and private debt as from government borrowing, have had their hands forced. Others still are pruning before the markets exert real pressure: Britain’s debt has the longest maturity of any EU member but it is still aiming to get its finances in order within four savage years.

Full chart after the jump

Mera Bharat Mahan !

  
Analysis, Economy, Education, Life
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-According to a new Oxford University study, 55 percent of India’s population of 1.1 billion, or 645 million people, are living in poverty. Using a newly-developed index, the study found that about one-third of the world’s poor live in India.

-As measured by the new index, half of the world’s poor are in South Asia (51 percent or 844 million people) and one quarter in Africa (28 per cent or 458 million). While poverty in Africa is often highlighted, the Oxford research found that there was more acute poverty in India than many African countries combined. Poverty in eight Indian states—Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Orissa, Rajasthan, Uttar Pradesh, and West Bengal—exceeded that of the 26 poorest African countries.

–The study examined poverty across 28 Indian states, concluding that “81 percent of people are multidimensionally poor in Bihar—more than any other state. Also, poverty in Bihar and Jharkand is most intense—poor people are deprived in 60 percent of the MPI’s weighted indicators. Uttar Pradesh is the home of largest number of poor people—21 percent of India’s poor people live there. West Bengal is home to the third largest number of poor people.”

-Only 31 percent of India’s population had access to improved sanitation in 2008.

–Another study that used a household income of $US2 a day as the poverty benchmark found that India not only has more poor people than sub-Saharan Africa, but also has a higher level of poverty. In India, 75.6 percent of the population, or 828 million people, live below the poverty line as compared to 72.2 percent, or 551 million people in sub-Saharan Africa.

In the 1950’s modern bread used to cost 10 paise, 1971 – 75 paise, 1980 – Rs 1.0, Today – Rs 16. All thanks to uninterrupted deficit budgeting . The definition of poverty line is something like Rs 3500 per YEAR and 27% of the population is below it. If you take the poverty line to be something to be more realistic like Rs 3500 per MONTH – you would have 70% of our population below the poverty line.

Great NEWS :IMF to provide give €10 Billion to Greece

  
Analysis, Economy, Education
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The International Monetary Fund is looking at raising its share of Greece’s financial rescue package by €10bn ($13.2bn) amid fears that the planned €45bn bail-out will fail to prevent the country’s debt crisis from spiralling out of control.

Senior bankers and officials in Washington and Athens told the Financial Times that the IMF was in talks to increase its aid contribution by €10bn. The fund could make that sum available under a planned three-year loan, according to an Athens-based analyst familiar with the talks.

Investors and policy specialists said that expectations of the size of the three-year package in Washington policy circles had increased to at least €70bn. The EU has so far proposed to provide €30bn and the IMF €15bn. “The fund’s current ceiling for Greece is €25bn and the release of the extra amount is under discussion,” the analyst said. The IMF declined to comment on the size of the package.

Dear Readers & Traders ,We are again first in India to give this NEWS.And in afternoon or late by evening once this NEWS will be out.Then watch huge short covering across the Globe.

Technically Yours

ASR Team

Baroda ,India

The Dollar Meltdown: Book Review

  
Analysis, Economy, Education
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090-1008121154-dollar-meltdownI had the pleasure of reading a final finished copy of The Dollar Meltdown by Charles Goyette.

Congressman Ron Paul offers an opinion on the front cover to which I certainly concur: “Goyette does a great job explaining why America faces a looming financial crisis and outlines commonsense strategies for individuals to protect themselves and their families. This book truly is a must read.”

Before publication, I read a preliminary copy which explains this quote on the back jacket “The Dollar Meltdown is the definitive guide to where we are, how we got here, and what the best investment opportunities are looking ahead, regardless of one’s personal views on the raging inflation/deflation debate”

Others on the back jacket endorsing the book include Jim Rogers, Lew Rockwell, and Peter Schiff.

Step by step Goyette outlines Where we are, How we got here, and What to do. The book is a nice blend of facts, humor, and practicality. It is easy reading and very difficult to put down. (more…)

$673 Billion In Commercial Paper Maturing Through July 16 As CP Rates Creep Higher

  
Analysis, Economy, Education
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As an increasing number of analysts evaluate the impact of Europe’s rolling defaults and failed auctions on Europe’s liquidity and particularly its shadow liquidity system, best seen in rising European Commercial Paper rates, is it about time to take a look at our own back yard. According to the Federal Reserve there is $673 billion in Commercial Paper maturing in the next 6 weeks alone, of which the bulk, Non-ABL Tier 1 CP amounts to $328 billion, ABL CP totals $292 billion, and Non-ABL Tier 2 CP totals $34 billion. What is concerning is that just like in Europe, rates here in the US for the various tranches of Commercial Paper have started rising. And as this is arguably one of the biggest components of the US shadow liquidity system, it bears close watching, especially if spreads continue leaking wider as they have recently. One thing to keep in mind: the Fed’ CPFF emergency facility has now been retired, and any hitch in the CP market will necessitate another brand new involvement in broad liquidity provisioning by the Fed. Then again, just as in the Central Bank liquidity swap case, which was reactivated on a moment’s notice, we don’t see any problem with the Fed announcing the CPFF program going live with no notice.

The chart below shows a maturity distribution of various CP tranches over the next six weeks.

And the recent rates on the three key CP tranches can be seen in the chart below. All three are trading at their 2010 wide levels.

More hungry in India than in Sudan

  
Analysis, Economy, Education
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NEW DELHI: India dropped two ranks to 67th among 84 developing countries in the International Food Policy Research Institute’s annual “Global Hunger Index” for 2010. Even Sudan , North Korea and Pakistan rank higher than India.

While the report, released on Monday, shows that the proportion of undernourished in India is decreasing, the worsening ranking indicates that other developing countries have done better in tackling hunger. India is home to 42% of the underweight children under the age of five in the world.

The policymakers in India , who are are still fighting over the need to have an expansive National Food Security Act , should look at the following data more closely: in 2005-06 , about 44% of Indian children — below five years — were underweight, and nearly half — 48% — were stunted.

The food insecurity is so rampant across the country that India is clubbed with minor economies like Bangladesh, Timor-Leste and Yemen, recording the highest prevalence of underweight in children under five.

At the beginning of the liberalization era in the early 90s, 24% of the population was undernourished. The situation marginally improved to 22% between 2004 and 2006. Almost 60% of children below five were recorded as underweight in 1988-92. The condition has remained dismal as the latest figure shows 43.5% between 2003-08.

The GHI ranks countries on a scale of 100, with 0 being the best score (no hunger) and 100 the worst. It is composed of three equally weighted indicators: the proportion of undernourished in the population, the prevalence of those underweight in children under five and the under-five mortality rate.

The figures for India are 22% (as of 2004-6 ), 43.5% (2003-8 ) and 6.9% as of 2008, respectively. These give India a composite GHI of 24.1, which is classified as alarming in terms of the food security situation.

The strife-torn Democratic Republic of Congo ranks at the bottom of the list of 84 countries with significant levels of hunger. The data has been compiled for 122 countries in all; the remaining 38 countries have a GHI of less than 5 and are not included in the rankings. No data has been recorded for highly developed countries.

South Asia has the highest GHI for any region in the world, at 22.9. The region has, however, made greater progress since 1990 than sub-Saharan Africa, the report adds. India is ranked below all other major South Asian countries — Sri Lanka is ranked 39th, Pakistan 52nd and Nepal 56th.

India’s hunger is not purely a product of its middle-income status. While economic progress and hunger levels tend to be inversely correlated (countries with higher gross national income typically have lower GHI scores), some countries are exceptions to the norm. China has lower hunger levels than its GNI per capita would suggest, while India has higher hunger levels than would be expected from its income per capita, calculations made by the report’s authors show.

The 2010 report focuses on child malnutrition, which is the biggest component of hunger worldwide. In India, high 2010 GHI scores are driven by high levels of underweight children, resulting from the low nutritional and social status of women in the country, the report says.



Portuguese Bank Borrowings From ECB More Than Double In May, Hit All Time Record of €35.8 Billion

  
Analysis, Economy, Education, Forex
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Alas, the deteriorating funding environment in Portugal is not a fluke – according to the Bank of Portugal, bank borrowings from the ECB surged in the past month, and doubled from €17.7 billion to €35.8 billion in May. As Steven Major from HSBC said, quoted by the FT: “These yields are approaching that magic number of 5 per cent that is likely to be charged by the European stability fund. If the yields keep going up at this rate, then they will be paying much more than 5 per cent next month, which is arguably unsustainable.” And confirming the non rose-colored glasses reality was another banker who said: “These yields are not sustainable. Portugal will have to access the emergency stability fund if they continue to rise at this rate.” Elsewhere, Greece continue to be bankrupt.

The chart below shows total borrowings from the ECB by Portuguese banks…

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