Disruption Has Cut Company Life-Span By 66%

Disruption is nothing new, with nearly 80% of industries that existed in the U.S. in 1900 no longer existing or being quite small today. However, the pace of disruptive forces may be accelerating, as the average age of a company listed on the S&P 500 has dropped substantially from [...]

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IFRS 9 Accounting Would Make Banks Appear More Robust During A Downturn

The new IFRS 9 accounting rules mandate that banks enhance their reserves and coverage ratios before problem loans peak, and Moody’s analysts believe the rules will indeed make banks better prepared to deal with loan losses during a downturn. Jorge Rodriguez-Valez and colleagues at Moody’s Investors Service said in their [...]

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Countries Face $70 Trillion Long-Term Savings Gap: Mercer

Eight large countries, including the U.S. and the U.K., are currently facing a $70 trillion gap between aggregate long-term savings systems and expected annual retirement income needs, underscores Mercer. In its recent report  entitled “Bold ideas for mending the long-term savings gap,” the firm highlights that the size of the [...]

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Only Regulatory Action Curbed Explosive Growth In Chinese Shadow

Thanks (and only thanks) to unified initiatives from PBoC, CBRC and CSRC, under Central government’s guidance,  the runaway growth in China's Shadow Banking "industry" has witnessed a trend reversal, notes Moody’s. David Yin and colleagues said in their July 3 research piece on Chinese banks that they believe these [...]

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Global Green Bond Issuance Could Surpass $100 billion In 2017

Though the recently-unveiled FSB Task Force on Climate-Related Financial Disclosure (TCFD) is currently voluntary in nature, Moody’s Investors Service believes the recommendations are likely to get substantial backing from large investors. Rahul Ghosh and colleagues at Moody’s said in their June 29 research note entitled “FSB Task Force Recommendations [...]

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BIS Warns Of Risk From Soaring Chinese Debt

Global growth is expected to be resilient in 2017, with advanced economies’ confidence indicators posting multi-year highs and EMEs clocking improved performances aided by higher commodity prices, notes the Bank for International Settlements. In its 87th Annual Report, the BIS report points out that the feared sharp slowdown in [...]

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Low Vol Leads To Big EM Inflows

On the back of global growth recovery and supportive monetary policy by core central banks, emerging markets logged another positive Q2 performance, notes Barclays. Christian Keller and colleagues said in their June 23 research piece titled “Calm on the surface, some turbulence beneath” that they believe global growth recovery [...]

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Australia’s Galloping Household Debt – Distribution Matters

Though relative to nominal GDP, Australia has the second highest level of household debt, HSBC analysts believe the household debt has been rising for fundamental reasons and hence doesn’t pose much worries. Paul Bloxham and Daniel Smith at HSBC in their May 16 research note titled: “Downunder Digest” reckon [...]

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Asian Exports Are Slowing

Though Asian exports clocked strong growth so far this year, Credit Suisse analysts believe the best of the export growth recovery is already behind us and Asia’s export growth will moderate from a mid-teens rate to the mid-single digits for the rest of the year. Santitarn Sathirathai and Michael Wan [...]

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What Could Go Wrong For Australia

Though tourism, education and rural exports contribute nearly one-quarter of Australia's exports, currency appreciation could pose the biggest risk for growth in these three sectors, according to Bank of America Merrill Lynch. Alexandra Veroude and Tony Morriss of BAML highlight in their May 5 research "Australia Economic Viewpoint Playing [...]

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FDI Alone has fully funded India’s Current Account Deficit

India's foreign direct investment (FDI) will remain at last year’s elevated levels, though the FDI inflows momentum may wither and the incremental gains over the next few quarters may not be limitless, according to HSBC. Pranjul Bhandari and Dhiraj Nim underscored in their May 3 research note titled “India’s external [...]

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Job Creation And Destruction By Technology And Automation

By analyzing shares of IT sectors in economic activity in major developed countries using three aspects -- output, factor inputs and household consumption (demand) -- Deutsche Bank analysts conclude that the share of IT sectors has been on the decline for household consumption. In their April 28 research piece [...]

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China's Government Debt Will Remain Stable …. If There Is No Shock

As China's government debt will edge up modestly to 37.5% of GDP in 2017 and only rise slightly next year, Moody's analysts rate China’s fiscal strength at "Very High." In their April 12 report titled “Fiscal Impulse Larger than Deficit Implies; Credit Impact Depends on Sustainability of Growth,” Marie [...]

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“Trump Trades Are Down But Not Out”: BAML

Following the failure to push through healthcare reform, Trump trades have received a new lease on life, according to Baml analysts. Claudio Piron and colleagues reiterate their long USD/short US rates bias in their March 31 research piece titled “The Waiting Game.” Booster for Trump trades Piron and team believe that [...]

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China Will Avoid Stagflation: HSBC

Despite witnessing rising prices and slowing growth, any risk of China facing stagflation is remote, according to one HSBC analyst. HSBC Chief Economist Xiaoping Ma believes it would be helpful for China to look back on how developed economies endured a painful period of stagflation during the 1970s. Lessons from [...]

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Global Growth Momentum Will Continue In 2017: Goldman Sachs

As the financial conditions impulse points to sustained improvement in global growth momentum, Goldman Sachs places global growth for 2017 at the top end of the 3% to 3.5% average pace over the past five years. Jan Hatzius and colleagues published their “GS Macro Outlook 2017” report after collating [...]

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