FRANCE ADDS €100 BILLION TO BAILOUT PLAN. French president François Macron, often criticized as the “president of the rich,” has announced the addition of €100 million to his country’s economic rescue plan, in part to aid the expected one million French workers who will be jobless by 2021 and deal with the country’s worst recession since World War II.
Macron, up for re-election in 2022, has loosened rules governing the labor market, sparking union protests. He also has vowed to reopen negotiations with labor groups over his plan to reform the nation’s lavish pension system.
CHINA’S STOCK MARKET LEADS OTHERS DOWN. China’s CSI 300 stock index had its worst day last week since February, dropping 4.8 percent and dragging down the U.S. Dow and NASDAQ markets. Hong Kong’s Hang Seng market fell 2 percent.
The renminbi, China’s currency, also had weakened.
Offshore investors cashed out of Chinese stocks in the benchmark CSI 300 index at a record pace, selling $2.6 billion worth of shares and bringing the market down 2.5 percent at one point before it closed the day with a 1-percent loss.
The sell-off followed a week during which the same market made its best gains in five years, rising 17 percent overall so far this year. The rise was fueled significantly by $19.2 billion invested by foreigners during the second quarter, the second-highest quarterly inflow on record.
Foreign investors can buy Chinese stocks through a formal program that accepts funds through Hong Kong.
The sharp sell-off was due to investors taking profits, not losing confidence in the market, many analysts said.
FOREIGN INVESTORS TAKE STOCK MARKET PROFITS. On 14 July, offshore investors cashed out of Chinese stocks in the benchmark CSI 300 index at a record pace, selling $2.6 billion worth of shares and bringing the market down 2.5 percent at one point before it closed the day with a 1-percent loss.
The sell-off followed a week during which the same market made its best gains in five years, rising 17 percent overall so far this year. The rise was fueled significantly by $19.2 billion invested by foreigners during the second quarter, the second-highest quarterly inflow on record.
Foreign investors can buy Chinese stocks through a formal program that accepts funds through Hong Kong.
The sharp sell-off was due to investors taking profits, not losing confidence in the market, many analysts said.
SINGAPORE ENTERS RECESSION. Singapore, the island bastion of free enterprise, reported a 41.2-percent drop in its GDP for 2020’s second quarter, throwing the nation into recession for the first time in a dozen years.
The contraction, Singapore’s biggest month-on-month loss ever, followed a 3.3-percent decline in the first quarter.
The figures add up to a 12.6-percent year-on-year contraction in the island’s GDP, the largest since 1965.
Singapore recorded among the highest per-capita COVID infection rates in Asia and imposed a strict lockdown that was lifted in early June.
Analysts expect the nation’s economy to recover quickly, in part because of a government stimulus initiative equivalent to about US$70 billion or 20 percent of GDP.
JAPAN CUTS 2020 ECONOMIC FORECAST. At its meeting on 15 July, the Bank of Japan lowered its forecast for the country’s economy this year.
In April, the bank foresaw GDP contracting by 3 to 5 percent by March 2021; it now expects the loss to be 4.5 to 5.7 percent.
The bank left its benchmark interest rate unchanged at -0.1 percent.
U.K. DOWN, GOING OUT. In May, Britain’s economy grew just 1.8 percent above April’s, the month that saw the U.K.’s GDP shrink a record amount. The kingdom’s economy remains about 25 percent smaller than it was in February.
May’s performance was weaker than analysts had expected.
TREND FORECAST: What has occurred and is occurring around the world, much of which has, and continues to be locked down with draconian restrictions, is unprecedented in world history.
To summarize, yes, there will be artificial economic rebounds as a result of massive money pumping schemes, which in turn are ballooning nations’ debt levels.
When the money-high wears off, as economies dramatically slump and equity markets crash, the reality of the severe damage inflicted by politicians on their nations will become reality.
New political parties will be formed, riots, protests and demonstrations will accelerate, civil and regional wars will erupt, and the impact of the “Greatest Depression” will take its toll.
Prepare now to Prevail and Prosper in the increasingly difficult times ahead.
