The upheaval spawned by COVID-19 has forced governments’ hands to wield counter-offensive measures, and one popular weapon has been fiscal stimulus. Although not everyone supports massive government spending as a tool for protecting and reviving economies hard hit by crisis, history confirms its successes and provides hope for recovery.
The GDP, the aggregate value of the goods and services produced, has been the go-to statistic for comparing nations’ economic prosperity. But is it the best measure? Increasingly, its value as a comprehensive gauge is being questioned, and the hunt is on for more holistic metrics that better account for such issues as standard of living.
During its policy meeting on Thursday, September 10, the European Central Bank (ECB) decided to keep its main refinancing benchmark rate unchanged at 0 percent, along with leaving its rates on the marginal lending facility and deposit facility the same at 0.25 percent and -0.50 percent, respectively.
The United States will soon break a record: the longest period of economic expansion, last set in the 1990s. But some don’t see this growth continuing much longer; they expect a recession, or even a depression, to extinguish the growth trajectory the world’s largest economy has been following for nearly a decade. Are these fears justified? Or are there as many reasons to expect the economy to continue to soar, shattering all records?
In October 2018, S&P Global Ratings issued a stark warning pertaining to China’s mounting debt problems. According to the ratings agency, the country’s local governments may be sitting on a pile of debt worth up to 40 trillion yuan ($6 trillion).
For Better or for Worse: The Linkage Between the US Economy and the Major Economies of the Western Hemisphere
The US economy is on track to break its own record; its current 115 months of expansion is only five months shy of the record set in the 1990s. The next recession will come, maybe soon, as the economy succumbs to factors such as policy errors, foreign growth and corporate profit. And the United States will not fall alone; other Western Hemisphere countries will be dragged down with it.
The rapid adoption of artificial intelligence and machine learning in all corners of the financial sector, particularly in anti-money-laundering (AML) efforts, has excited and inspired onlookers and participants alike. But as with all innovations, there are pitfalls to unquestioning acceptance that can actually worsen the situations these technologies are meant to address. Human intelligence must work cooperatively and in the lead role alongside AI and ML to guarantee the best results.
Abu Dhabi, capital of the UAE, is rich in oil but suffers from underuse of its own human resources. Abu Dhabi’s commitment to rebalancing away from oil will be underpinned by improvements in financial education, exemplified by a new academy launched by Abu Dhabi Global Market in partnership with the London Institute of Banking & Finance.
U.S. banks are highly profitable and supporting of economic activity, as they were prior to the 2008-09 financial crisis. It is important to remember how quickly conditions can change. As a result of post-crisis prudential reforms, banks have bolstered their capital and liquidity. It is essential to preserve these hard-won improvements. It would be a mistake to assume that a severe downturn or crisis cannot happen again.
Israel, one of the 35 members of the OECD, is leading the pack in terms of economic growth, according to a recent OECD survey. And not only currently but consistently over the course of recent years. What are the reasons for the Middle Eastern country’s outstanding economic performance, and what are the factors that may hinder it