Archive for the ‘Economy’

  • What a Selective Default Means for Treasury Bonds>
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    What a Selective Default Means for Treasury Bonds
    The case of a selective default by the United States Government has been much pondered upon in the recent times. The exact nature of the happenings cannot be predicted by anyone. One thing is for sure, it does not imply that people would not receive their payments, but just that they will be a bit late. How long this wait will be, and who will get paid late can be guessed by anyone. Even if US administration prioritizes its debt payments, a default, however small, has the possibility of a lowered US credit rating. That’s bad news in many ways, and good news in a few. This states to the world that the United States is not credit worthy as it has always been. It also could imply that the value of the dollar could reduce with respect to currencies of other countries. The decidedly shaky environment  [...]
    at August 8th, 2011 at 04:08 am
  • Which corporate citizens shall you choose for investing?>
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    Which corporate citizens shall you choose for investing?
    The companies nowadays are in the dual trouble as they are faxed with the aim of gaining high returns in their business while keeping their social responsibility at its place. The consumers today are aware enough about the environment ad they bank on the companies who embraces the corporate social responsibility. This has made companies today (willingly or unwillingly) have become corporate citizens. After all the business has to be made while keeping the consumers satisfied. And when the consumers are well informed, then business becomes a challenge. That’s why I believe that corporate citizenship is a type of business challenge for the present day entrepreneurs. Recently in an edition of Corporate Responsibility magazine 100 best corporate citizens were named and different elements of corporate  [...]
    at April 20th, 2011 at 05:04 am
  • India – Left Leaning Congress Ups Social Spending by 17 per cent>
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    India – Left Leaning Congress Ups Social Spending by 17 per cent
    Pranab Mukherjee, Finance Minister of India unveiled the Union Budget for the financial year 2011-2012 yesterday, 28th February. The new financial year starts from 1st April. The budget focused on a good number of reforms aimed at the poor or the “aam aadmi” (the common man). The budget promised several populist measures such an as increase in social expenditure 17 % and decrease in inflation, especially food inflation. Social spending means the money earmarked for the various welfare schemes by the government to eradicate illiteracy, unemployment and other social evils. Spending was increased for the benefit of education, rural employment, food programs, and agriculture. The poor and rural masses form the large percentage of the country’s population, and are also the core support group  [...]
    at March 2nd, 2011 at 05:03 am
  • Cities are Where the Money Is – Mayors Vs Obama>
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    Cities are Where the Money Is – Mayors Vs Obama
    Just a week after the President of the United States Barack Obama and the United States Congress have put forth a suggestion to slash federal aid and grants provided to cities a study reported that cities are the actual economic drivers of the country. In 47 out of 50 states, cities are responsible for the lion’s share in the total economic output of the states. The study was released by the Brookings Institution think tank. The suggestion of cutting grants to cities is part of the ongoing attempt to reduce the federal deficit of the United States which has been projected to go above $ 1.6 Trillion in 2011. The House of Representatives passed a funding bill, the substance of which amounted to a reduction of grants to cities by $ 1.5 billion. This amount makes up 62.5 per cent of what federal  [...]
    at March 1st, 2011 at 12:03 am
  • US public debt needs the stimulus, but questions about austerity linger>
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    US public debt needs the stimulus, but questions about austerity linger
    It is incredible when you think about it. The United States has not yet been taken to task for the sheer size of US public debt by the more vigilant among us. Indeed, stimulus policies seem here to stay for the time being. Many prominent economic minds of our generation, such as Nouriel Roubini and Paul Krugman, support these financial stimulus moves, at least in the short haul. This is in some ways a good thing for nations with as huge a debt burden as the USA, since pulling out of offering these stimulus measures might end up being the catalyst for a downward deflationary spiral and that word investors and the public at large has come to fear, a double-dip recession. The only thing anyone likes double-dipped is their ice cream, of this I’m sure. However, to look at the stimulus and  [...]
    at November 10th, 2010 at 12:11 am
  • American economy a bit zombie-like>
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    American economy a bit zombie-like
    By all accounts, the American economy is a bit unhealthy as of now. Pick an economic indicator, any indicator. Third quarter GDP is at 2%, this figure released just before Halloween and causing quite a fright. Unemployment and personal consumption figures aren’t exactly stellar either, and any gains effected by the GDP were set off by net imports and sharply outdone by the increase in inventories. Consumption figures have been alright, but nowhere near what it should be and the savings rate too has fallen, presenting a picture that is not rosy at all. In a sense, the American economy is a bit like a zombie right now; it’s the walking dead, ambling along in a mindless haze. In a normal, well-balanced economy, consumption and GDP is locked in a sweet, sweet tango while savings is  [...]
    at November 3rd, 2010 at 05:11 am
  • The long road ahead>
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    The long road ahead
    A wave of infrastructure projects are sweeping across the face of this big blue rock we call planet Earth, but the United States is remarkably immune to this epidemic. And that can be put down largely to the stonewall America has presented to almost any and all opportunities to spend money. That more than anything else is hurting the improvements we need to put in place with roads, airports, seaports and railway systems across the length and breadth of the land of the free and home of the brave. Slightly worryingly, the American Society of Civil Engineers published a report that put the figure of investment needed for America at $1.6 trillion over a period spanning five years. And that’s just to bring infrastructure up to a level that can be deemed standard, so the road is long and arduous. But  [...]
    at October 27th, 2010 at 12:10 am
  • The currency war takes two to tango>
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    The currency war takes two to tango
    Imagine for a moment that you were a professor in a classroom of bright-eyed, eager young students looking to learn a thing or two about whatever it is you had set your heart out to learn, and I asked you a very simple question; who, in your opinion, kick-started the global currency war we now find ourselves embroiled in? Obviously some students, having analysed the subject in however much detail, would say that the obvious answer for this was simply China; as one of the largest currency manipulators in the world, China has been one of the most restrictive and manipulated currencies, nothing more than a puppet on a string for the Chinese monetary authorities. They have the single largest trade surplus in the world and foreign exchange reserves that are bottomless (well, not bottomless, but  [...]
    at October 18th, 2010 at 01:10 am
  • Let’s get fiscal>
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    Let’s get fiscal
    You know that things are really bad when a former Federal Reserve Chairman says that the U.S. fiscal deficit is “scary”. That is the sort of description a child might throw out, or maybe an ill-informed and slightly inarticulate student. But when someone that has headed the Federal Reserve chooses that specific word to describe the situation we find ourselves in, you know we’re in some really big trouble. The federal government is playing with fire and it needs to cut any spending on entitlements in what is a very dangerous game. Speaking at an event, Greenspan was at pains to point out the increase in debt that is being held by the American public. It is, in fact, increasing at such a rapid pace that it is swiftly eroding away any capacity we have when it comes to borrowing. The cushion  [...]
    at October 11th, 2010 at 02:10 am
  • Banking on Bernanke>
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    Banking on Bernanke
    The Federal Open Market Committee released a statement recently based on information they had received since the Committee last convened in August. Among broader things, the statement talked about The pace of recovery, and how it has slowed down of late. Household spending increasing, but being hamstrung by high unemployment levels and unavailability of credit. Inflation not being consistent with its price stability and employment mandates. How there will likely be no shift in policy from the September gathering. It’s annoying in a sense, since the Fed does acknowledge that there is an issue, but this policy is tantamount to just sweeping the issue under the carpet. The Federal Reserve has its stated aims and ambitions for the economy and even as these aims might well not be the met, the  [...]
    at September 27th, 2010 at 01:09 am
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