(July 29, 2018) Weekly Topics of Global Economy

[kyonmanchung]

(July 29, 2018) Weekly Topics of Global Economy

안녕하세요? 미국의 2분기 경제성장률이 무려 4.1%로 나왔습니다. 세계 최대급 석유 매장국 Venezuela가 올해 물가 1,000,000% 앙등, 경제성장률 -18% 등 경제적 재앙에 직면 -> 많은 국민의 탈주로 이어지고 있습니다.

1. U.S. Growth Hits 4.1%, Fastest Since 2014, in Win for Trump, Bloomberg

미국의 2분기 경제성장률이 2014년이래 최고인 4.1%(연율)를 기록하였습니다. 아울러 1분기 성장률도 당초 2.0%에서 2.2%로 상향 조정되었습니다.

민간소비가 4% 증가하고, 기업투자가 7.3% 증가하였으며, 여기다 순수출(X-M)도 1.o6%p 증가하였는데 대중국 대두 수출이 보복관세 부과 전에 집중되었기 때문(이 여파로 재고 투자는 1p하락)

이런 빠른 성장은 Trumpnomics에 의한 Tax cut과 재정지출 확대에 힘입은 바 크므로, Trump가 기고만장 “amazing” and “very sustainable”이라고 할만 하지요.

그러나, 이러한 성장추세가 계속 이어질지에 대해서는 부정적 의견이 많음. 왜나면 세금감면에 의한 소비 및 투자증가 효과는 차츰 약화될 것이고, 순추출의 경우 무역분쟁 본격화 이후 향방을 예측하기 어렵기 때문임.

<Remember, Y+C+I+G+X-M(지출소득방정식)에 의한 거시경제 분석의 유용성>

한편, GDP의 호조는 Fed의 9월 금리인상 가능성을 90%(CME기준)까지 높였음. Fed는 올해 3월, 6월 두차례 금리를 인상하였고 년내 두차례 더 인상을 예고한 바 있는데 9월과 12월이 될 것임. 소비자물가도 계속 오름세(4월 2.5%->5월 2.8%->6월 2.9% 각 전년동기 대비)이므로 Trump가 불평하드라도 금리인상은 불가피해 보임.   

<생각>

 감세+인프라투자확대+규제완화+보호무역을 주 내용으로 하는 Trumpnomics의 긍정적 효과(소비와 투자증가로 경제성장 가속, 자국산업보호)는 대부분 단기에 나타나는 반면, 부정적 효과(재정적자확대+조기경기과열+규제완화의 양먼성+무역감소로 인한 물가상숭 및 역성장)는 장기에 걸쳐 나타나는 것들임.

Trump의 호기가 언제까지 지속될지 두고 보죠.  

2. Venezuelan inflation predicted to hit 1 million percent this year, CNBC 

- Venezuela가 최악의 경제적 재앙으로 치닫고 있습니다. IMF에 따르면, 올해 Inflation이 무려 1,000,000%까지 치솟을 수 있고, GDP growth rate는 -18%를 기록할 것으로 예측함(3년 연속 두 자리 수 역성장).

Hyperinflation은 외국인 투자를 차단하고, 기업의 투자의욕을 손상시키며, 가계의 저축과 임금 가치를 삭감하는 등 경제 시스템전반의 활등 정지를 초래하는데, 과거 사례로는 Germany in 1923과 Zimbabwe in the late 2000s가 있음

세계 최대급 석유 매장에 천연가스, 알루미늄, 구리, 망간, 보크사이트, 금, 다이아몬드, 철광석 등 지하자원이 풍부하고, 광활 비옥한 국토(한반도의 거의 4.5배)를 가진 나라.  우리로서는 못산다는 게 이상한 나라가 왜 이 지경이 되었을까? 답은 한마디로 economic mismanagement!

경제의 석유 의존도(수출의 90% 등)가 매우 높아 유가 상승 시는 부국이 되지만 유가 하락 시는 치명타 ->유가하락 시 총수요 억제 대신 Populism에 의한 선심성 정부지출 확대 + 발권력에 의한 통화팽창 ->통화가치 하락 -> 물가 앙등(한 때 선진국 문턱에 섰던 남미 제국의 거의 공통적 패턴이지요).

2013년 Chaves대통령 사후 집권한 Maduro 대통령(최근 재선 성공)의 연이은 경제정책 실패 -> 작년 하반기 이래 외채 상환 불능 -> 외자 유입 중지. 여기에 미국의 가혹한 경제 제재(투자자산 동결에 대한 대응조치)가 설상가상.  

경제가 극도로 악화되자 국민의 해외 탈주(fleeing)가 심화(2014년이래 150만명) -> brain drain과 work force 부족현상도 발생. 허참.

<생각> Venezuela의 경제정책 실패가 초래한 국민적 재앙을 타산지석으로 삼아야!

정견만 드림

1. U.S. Growth Hits 4.1%, Fastest Since 2014, in Win for Trump, Bloomberg

By Sho Chandra

‎2018‎년 ‎7월‎ ‎27‎일‎ ‎오후‎ ‎9‎:‎30 Updated on ‎2018‎년 ‎7월‎ ‎27‎일‎ ‎오후‎ ‎11‎:‎06

• Consumer spending rises 4% following tepid first-quarter gain
• Business investment advances; inventories offset trade boost

The U.S. economy accelerated to a 4.1 percent pace of growth in the second quarter, the fastest since 2014, letting President Donald Trump claim a win for his policies even though expansion is projected to cool.

The annualized rate of gains in gross domestic product was just shy of the 4.2 percent median forecast in a Bloomberg survey. It followed first-quarter growth of 2.2 percent that was revised from 2 percent, the Commerce Department reported Friday. Consumer spending grew 4 percent, more than estimated, while nonresidential business investment climbed at a 7.3 percent clip.

Trump seized the chance to declare his policies, including the biggest tax overhaul since the Reagan era, a success, calling the data “amazing” and “very sustainable.” The likelihood is nevertheless that the pace of expansion will slow as the effects of tax cuts fades, companies pull back in the face of foreign tariffs and the Federal Reserve raises interest rates further.

Illustrating the volatility of some elements of GDP, net exports contributed 1.06 percentage point to the pace of growth, the most since 2013, partly on a surge in soybean shipments ahead of retaliatory tariffs. Inventories subtracted 1 point, the most since 2014, Commerce said, citing soybean stocks as well as those of drugs and sundries and petroleum and related products.

Fed policy makers are expected to continue their gradual pace of interest-rate hikes aimed at keeping the economy from overheating, without moving so fast that they could choke off growth. The dollar and yields on 10-year Treasuries declined after the report, which also showed inflation excluding food and energy was lower than estimated.

“The economy is doing quite well,” said Michael Feroli, chief U.S. economist at JPMorgan Chase & Co. “It’ll be hard to repeat this performance on a sustained basis,” as the boost to demand from tax cuts may fade, the dollar’s strength could curb exports and tariffs present a risk, he said.

The latest data won’t change the pace of the Fed’s interest-rate hikes, Feroli said.

‘Great Numbers’

Trump, speaking Friday at the White House, celebrated the report and said the economy is on track to reach an annual growth rate of more than 3 percent. “As the trade deals come in one by one, we’re going to go a lot higher than these numbers, and these are great numbers,” the president said.

Economists’ forecasts for second-quarter GDP, the value of all goods and services produced in the nation, ranged from 3 percent to 5 percent. The GDP estimate is the first of three for the quarter, with the other releases scheduled for August and September when more information becomes available.

With the Friday data, the Commerce Department also released comprehensive GDP revisions going back decades. They showed a higher household-saving rate than previously reported, as well as faster growth in the first quarter of recent years, though the overall narrative of the economy’s performance over the last decade wasn’t much different.

Performance Upgrade

Early-year U.S. economic growth stronger after government revisions

Source: Bureau of Economic Analysis

The revisions also showed the economy surpassed $20 trillion in nominal dollars in the first quarter.

Even with the relatively strong pace of growth last quarter, most economists expect expansion to settle back to near its long-run rate, and some have flagged the risk of a recession in two years. While polls and historical trends suggest Democrats are primed for significant gains in November’s midterm elections, voters give Trump high marks for the economy.

GDP Goal

Compared with a year earlier, second-quarter GDP rose 2.8 percent, just shy of the 3 percent mark, which was last reached in 2015. The Trump administration’s official goal is for sustained GDP growth of 3 percent, which would well exceed the average 2.2 percent pace during this expansion and the Fed’s longer-run expectation of 1.8 percent.

One measure that economists look at for a better sense of underlying demand showed strength. Final sales to private domestic purchasers -- which exclude trade, inventories and government outlays -- grew at a 4.3 percent pace, the second- fastest since 2014.

The pace of expansion in consumer spending, which accounts for about 70 percent of the economy, exceeded projections for 3 percent and contributed 2.69 percentage points to growth. Purchases of new autos were a major factor, along with spending on health care, housing and utilities and food services and accommodations. That followed a downwardly revised 0.5 percent pace of consumption growth in the prior three months.

In addition to lower taxes, consumers’ purchasing power is benefiting from steady hiring, an unemployment rate that’s near the lowest since 1969, improving finances, relatively low borrowing costs and contained inflation.

Business Investment

The growth in nonresidential business investment contributed almost 1 percentage point to growth though the 7.3 percent pace was slower than the first quarter’s 11.5 percent. Spending on structures advanced 13.3 percent following a 13.9 percent gain in the prior period, while equipment investment cooled to 3.9 percent and intellectual property spending slowed to 8.2 percent.

Housing remained a weak spot in the economy amid signs that the sector is poised for its broadest slowdown in years. Residential investment contracted at a 1.1 percent rate, the fourth decline in five quarters. The drag on overall growth, though, was negligible.

The contribution from net exports reflected a 9.3 percent gain in shipments abroad and a 0.5 percent increase in imports. In addition to soybeans, exports were boosted by petroleum and related products. “Producers may have front-loaded some goods for exports ahead of the tariffs,” JPMorgan’s Feroli said.

Government spending increased at a 2.1 percent rate, adding 0.37 percentage point to growth. Federal outlays rose 3.5 percent, the second-fastest rate since 2014, boosted by defense spending. State and local outlays advanced 1.4 percent.

Spending Power

The data showed consumers’ wallets grew at a slower pace. After- tax incomes adjusted for inflation increased at a 2.6 percent annual pace, after 4.4 percent in the prior quarter. The saving rate fell to 6.8 percent from 7.2 percent, which was revised from 3.3 percent as part of the comprehensive update.

First-quarter gross domestic income, adjusted for inflation, was revised to a 3.9 percent gain from a previously reported 3.6 percent.

Price data in the report indicated that inflation was in line with the Fed’s goal. Excluding food and energy, the central bank’s preferred price index rose at a 2 percent annualized rate last quarter, following 2.2 percent in the first three months of the year.

1-2. Fed to send clear message that more rate hikes are coming

By Greg Robb

Published: July 28, 2018 1:05 p.m. ET

Discussion of strong growth, pickup in inflation will point to September moveShare

The Federal Reserve will issue a statement declaring strong growth and inflation moving to its 2% target, making clear more interest rate hikes are coming.

“All they need to do is to point to current growth and inflation numbers and it tees up the next rate hike in September,” said Diane Swonk, chief economist at Grant Thornton.

Read: U.S. economy accelerates to 4.1% rate in second quarter, fastest in almost 4 years

The Federal Open Market Committee will release a statement at 2 p.m. Wednesday after two days of talks.

There will not be updated economic forecasts or a press conference from Fed Chairman Jerome Powell.

Because there is no press conference, analysts are pretty certain the central bank will not move rates at the meeting. Although the Fed always insisted it could raise rates at a non-press-conference meeting, it never has.

This is the second-to-last FOMC meeting without a chance for reporters to ask the Fed chairman any questions. Powell announced last month there will be a press conference after all eight FOMC meetings in 2019.

This year, the Fed has a total of eight meetings, with only four press conferences.

“Next year, we’ll get to hear directly from Powell on subtle changes in views that don’t make it into a statement now,” said Dean Maki, chief economist at Point72 Asset Management.

Analysts welcome the change.

“Why waste four meetings per year,” said Roberto Perli, a former Fed official and now partner at Cornerstone Macro LLC.

The Fed does not have much work to do in its statement, analysts said.

The Fed has penciled in two more moves this year, expected at the meetings with press conferences in September and December. The FOMC raised rates by a quarter-point in March and June to a range between 1.75 and 2%.

Read: Fed lifts interest rates and aims for another pair of increases later this year

Investors are already on board a September rate hike, pricing in 90% chance of a move, according to the CME Group’s FedWatch tool.

Downside risks from trade tensions have not yet altered the Fed’s resolve to follow a gradual course of tightening, said Ellen Zentner, chief U.S. economist for Morgan Stanley.

Michale Feroli, chief U.S. economist at JPMorgan Chase, said the Fed is still scrambling to get interest rates “onsides” or up to neutral, around 3%.

Once the Fed gets rates that high, the decisions will get harder, he noted.

“Once you get back to neutral, it is more of a judgement of whether the economy is overheating,” he said.

2. Venezuelan inflation predicted to hit 1 million percent this year, CNBC 

• "Sadly, it is a long story of economic mismanagement."
• Over 1.5 million people have left the county since 2014.

Silvia Amaro | @Silvia_Amaro

Published 7:36 AM ET Fri, 27 July 2018

Venezuela is arguably going through one of the largest economic disasters in world history, with prices soaring uncontrollably each day.

The International Monetary Fund (IMF) said this week that the Latin American nation is "stuck in a profound economic and social crisis" and that inflation will hit 1 million percent by the end of the year. The Fund compared the situation in Venezuela to Germany in 1923 and Zimbabwe in the late 2000s, where the collapse in demand for money led to historically high prices and dramatic social issues.

"Hyperinflation brings the economic system to a halt: It scares off foreign investors, discourages local business, destroys the value of savings and wages for households, thus damaging long-term economic growth," Francesco Filia, chief executive officer at the London-based fund Fasanara Capital, told CNBC via email.

"It makes serial defaults and capital controls inevitable. Once set in motion, it is very hard to stop, as the credibility of policymakers is badly damaged," he added.

How did Venezuela get here?

"Sadly, it is a long story of economic mismanagement," Zsolt Papp, emerging market debt investment specialist at J.P. Morgan Asset Management, told CNBC over the phone Friday.

The Venezuelan economy is heavily dependent on oil exports which once made the country very rich. It's said to have the largest proven oil reserves in the world. Oil leaving the country accounts for about 90 percent of its total exports. When oil prices began to collapse in 2014, the cash received by Caracas dropped significantly — bringing new economic challenges.

The regime of Nicolas Maduro, who replaced Hugo Chavez in 2013, opted to keep the official exchange rate overvalued and tightened the government's control over access to U.S. dollars — meaning that it became harder for Venezuelans to change their bolivars, the national currency, for the greenback. This further increased the number of bolivars available and provoked a decrease in imported goods. Lower imports boosted domestic prices, thus taking inflation to record levels.

The economic problems in Venezuela are mostly a result of the policy direction taken by Maduro. Instead of cutting spending — traditionally seen as an unpopular measure among voters — Maduro opted to print even more money, contributing further to inflation.

Furthermore, Venezuela has also been hit by international sanctions. The United States prohibited dealings in new debt from the Venezuelan government and the country's state oil firm, arguing these help the government, which the U.S. described as a "dictatorship."

The economic difficulties in Venezuela led the country to miss debt repayments to international investors last year. Missing payments not only increases its debt pile, but also worsens the opinion that money managers have of Venezuela. Losing credibility among investors reduces Venezuela's chances of getting more credit.

"We need to see change in policymaking. Until we see a change in policy, it is difficult to see how the economy will turnaround," Papp also told CNBC. He said it is "very safe" to forecast that an end to the Venezuelan crisis won't come in the next months, but it will rather take some years.

What next?

According to the IMF, growth is set to sink 18 percent this year, the third consecutive double-digit fall.

"We expect the government to continue to run wide fiscal deficits financed entirely by an expansion in base money, which will continue to fuel an acceleration of inflation as money demand continues to collapse," the Fund said Monday.

Given the scale of the problems, even the recent rebound in oil prices is unlikely to dramatically shift the situation in Venezuela, Papp from J.P. Morgan Asset Management said.

In an attempt to fight hyperinflation, Maduro announced Thursday plans to cut five zeros off the country's currency, rather than the three he had previously said. The new notes will come into circulation next month.

However, even the highest denomination note will only be worth $6 by the end of August and as little as 20 cents by the end of the year, the Financial Times reported Friday.

As a result, Venezuelans are fleeing the country. According to data from the United Nations, published last May, over 1.5 million people have left the county since 2014.

"Thousands continue to legally enter daily in neighboring countries," the report said, adding that expectations are the flows will continue during 2018.

The high number of people leaving Venezuela brings further economic problems. Not only does the country become a victim of so-called brain drain, but it also begins to a lack a labor force.

[모러바(volt)]

세계경제에 이해가 많이가고 마지막 타산지석까지.오늘도 소식보다는 공부 많이하고 갑니다.

[도드람]

미국경기가 좋다가 나빠질 거라면
울 나라는 나쁘다 좋으려나? 정말 걱정이네....합리가 실종되고 증오만 있는 나라

[도드람]

파키스탄이 구제금융을 신청 할거란 뉴스가 있던데 이쪽 아세안들 어찌 돌아 갑니다
탁월한 정보력과 판단력을 기초로 좀 알려주세요 ^^