Category: Economy

Canada, Economy

Countries that are least affected by the Economic Crisis

Colin Henderson

An interesting survey of business reaction to the crisis, and which countries are least impacted.  Full ranking follows the map.  This explains a lot in terms of peoples reactions. Time will tell if this reaction remains constant, and what were the contributors to and rivers of this reaction. Countries that are Least Affected by Recession | digital inspiration The data is based on the results of a business confidence survey that was done on international business people of 24 nations to identify which countries they believe are surviving the crisis the best. Researched by Nobuyo Henderson Continue reading Countries that are least affected by the Economic Crisis

Canada, Economy

Canadian banks will require more capital to remain within targets

Colin Henderson

The IMF have released their working papers following their analysis of Canadian Banks.  Notwithstanding the positive comments about Canadian banks financial position entering the crisis, there remains potential for a requirement for increased capital as negatives in Canada could decrease bank capital by 2.5% – 3.5% over next year or two. The IMF employed the American stress test approach to Canadian banks in this exercise. Here is the current position: There are two ratios being watched – Tier 1 and Total Capital.  In a nutshell and worst case scenario, IMF are saying if 2.5% or 3.5% is taken off either … Continue reading Canadian banks will require more capital to remain within targets

Economy, Innovation

The Aftermath of Financial Crises | study

Colin Henderson

A short and useful paper offerring some points that help to frame the next few years for strategic planning purposes.  This to be read of course in the context of politicians preaching ‘road to recovery’ which leaves the uninformed with the view that we will get over this blip and back to normal. I prefer to think of this as a shift that will profoundly change things for the next few years, with some good and some not so good elements in that shift.  It may be good that the banking industry will be shaken up, and out of that … Continue reading The Aftermath of Financial Crises | study

Economy, Japan

How much do we understand the meaning of less GDP now and forseeable future

Colin Henderson

The fall in GDP for Japan appears nothing short of catastrophic, yet on a visit there last week by Nobuyo, the effects of this change are not obvious to the everyday Japanese person. One change that was noticeable in Tokyo is less foreigners (Gaizin).  The area around Roppongi and Azabajuban is normally where one can expect to see many western faces in the restaurants and bars.  No more.  Companies such as Lehman Brothers, Merrill Lynch, and AIG as well as numerous other western financial services companies had representation in Japan, however that is quickly shifting. This still does not appear … Continue reading How much do we understand the meaning of less GDP now and forseeable future

Economy

The power of positive thinking from Deutsche Bank

Colin Henderson

This is a very sensible article by Neil Hume at the FT.  He notes the extraordinary growth in bank stock prices since the infamous CitiBank memo in March, wherein he basically pronounced the worst as over, because he had removed the bad people, was instituting new processes, and working with Government. What struck me is this quote from an analyst at DB (emphasis added) On London: Banks’ rehabilitation could take time Add it all up, and the reason banks have rallied is investors are no longer worried about nationalisation and are prepared to look through two years of rising bad … Continue reading The power of positive thinking from Deutsche Bank

Canada, Economy

Bank of Canada Monetary Policy Report Apr 2009 sees economy worse that projected, but consumer credit is growing

Colin Henderson

Bank of Canada has released its quarterly Monetary Policy report.  It is useful here in the context of Canada and the impact on consumers, particularly as Canada has been painted as being in better shape than other countries.  Consumer confidence represented by purchasing is down, but consumer credit is still growing at a slower pace.  They question will be to what extent credit defaults arise over upcoming months. Speech and Report: Global industrial production has fallen sharply … … and Canadian GDP has fallen sharply too, and worse than predicted earlier .. … while the Canadian hit on wealth has … Continue reading Bank of Canada Monetary Policy Report Apr 2009 sees economy worse that projected, but consumer credit is growing

Economy1 Comment

Loan losses could reach $4 trillion | requires additional bank capitalisation of up to $725 bn

Colin Henderson

The IMF has released its semi annual Global Stability review, that few paid attention to before, but now has much increased visibility.  In particular this week, with Geithner about to release the results of the bank stress tests, this pre-empts the Fed leaving much little room to manoeuvre in understating the outcomes. Bottom line – the IMF sees $ 2.7 Tn in US based originated write offs and $ 4 Tn in total write offs, with banks absorbing 2/3 of that. IMF Global Stability Review – April 2009 Without a thorough cleansing of banks’ balance sheets of impaired  assets, accompanied … Continue reading Loan losses could reach $4 trillion | requires additional bank capitalisation of up to $725 bn

Economy

World Bank updates Global economic prospects downward

Colin Henderson

This revised forecast shifts from 2010 recovery,to an uncertain 2010 recovery.  Read through for data and forecasts on your country. World Bank updates global forecast This update of the projections in the World Bank’s Global Economic Prospects report (GEP) of December 2008, reflects the rapid  deterioration in financial and economic conditions—and the increasingly negative interaction between weakening economies and fragile financial systems—that have come to the fore since late 2008 for virtually every country in the world. gep-update-march30-2009 PDF Continue reading World Bank updates Global economic prospects downward

Economy

Transparency pledge in bank stress tests – now May 2009

Colin Henderson

Confusing messages coming out on the timing of the Bank stress tests – now expected May. Transparency pledge in bank stress tests | FT The White House on Wednesday pledged “transparency” over the stress tests used to assess the health of the biggest US banks, as officials pushed wary banks and regulators to agree to disclose as much information as possible. Robert Gibbs, US presidential spokesman, said that “early in May” there would be “transparency of determining and showing to all involved some of the results” of the tests. Continue reading Transparency pledge in bank stress tests – now May 2009