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☆ How AI’s astonishing productivity gains could help curb inflation
▼ + stars: | 2023-07-12 | by ( Hanna Ziady | ) edition.cnn.com time to read: +7 min

Experts say the technology will help address a steep and prolonged slowdown in productivity growth in many Western economies, which has kept businesses’ costs higher than they would otherwise be and made inflation harder to tame. “AI has huge potential to increase productivity,” BlackRock CEO Larry Fink said at the company’s Investor Day last month. Productivity gains in Europe could be similar, albeit slightly smaller, Brynjolfsson told CNN. In some cases, productivity gains could be achieved sooner. That’s because most generative AI tools live on the internet — “the technology we already have on our desks” — making them widely accessible, Brynjolfsson said.

Persons: chatbot, —, Smart, Hannes P Albert, Bill Gates, Larry Fink, Erik Brynjolfsson, ” David McMillan, ” McMillan, Hollie Adams, Neil Shearing, Martin Neil Baily, Anton Korinek, Brynjolfsson, Goldman Sachs, ” Organizations: London CNN, Microsoft, BlackRock, CNN, Stanford University, Organisation for Economic Cooperation, Development, OECD, University of Stirling, Bloomberg, Getty, “, National Statistics, IBM, Capital, Brookings Institute, University of Virginia’s Darden School of Business, America, Productivity, Google, SAP, Goldman Locations: East, Scotland, London, United Kingdom, United States, Europe, Wimbledon

☆ China's economic downturn is more shocking than outsiders realize, says former Chinese property mogul
▼ + stars: | 2023-07-11 | by ( Filip De Mott | ) www.businessinsider.com time to read: +3 min

China's economic conditions are worse than thought, Desmond Shum told The New York Times. This will result in tighter control of the firms by Beijing, as it become less secure. These factors have already caused Beijing to acro, with the People's Bank of China implementing interest rate cuts to reignite economic activity. But in Shum's view, conditions are also making the country's top brass insecure, resulting in tighter control of the nation's business landscape, especially among foreign firms. "People talk about 'deglobalization,' but the proper term is 'reglobalization minus China,'" Shum said.

Persons: Desmond Shum, Desmond Shum —, I've, Shum Organizations: New York Times, Service, People's Bank of China Locations: Beijing, Wall, Silicon, China, acro, Vietnam, Indonesia, Sri Lanka, India

☆ India is heading for 'very high growth' but challenges remain, says Goldman Sachs CEO
▼ + stars: | 2023-06-28 | by ( Charmaine Jacob | ) www.cnbc.com time to read: +1 min

David Solomon, Chairman and CEO, Goldman Sachs, participates in a panel discussion during the annual Milken Institute Global Conference at The Beverly Hilton Hotel on April 29, 2019 in Beverly Hills, California. Michael Kovac | Getty Images Entertainment | Getty ImagesIndia has a "very, very high growth trajectory," but bureaucratic challenges persist, CEO of Goldman Sachs David Solomon said in an exclusive interview with the Economic Times. "A great deal has happened in the world and I think looking at India, people see opportunity. He said there will be changes to the terms of engagement going forward, "but that is different from a complete economic decoupling. In turn, it presents a very interesting opportunity for India, but it's also not without challenges."

Persons: David Solomon, Goldman Sachs, The Beverly Hilton, Michael Kovac, Goldman Sachs David Solomon, Solomon, it's Organizations: Milken Institute Global, The Beverly, The Beverly Hilton Hotel, Getty, Economic Times Locations: Beverly Hills , California, India, China, U.S

Just where that notional 'R-star' lies has been clouded by the wild supply-side distortions of the COVID-19 pandemic and last year's energy shock. Raising R-star from recent low levels would probably increase uncertainty in markets about its longer-term level and direction too. On the other hand, if R-star is closer to zero, as Williams has suggested should be the case, current policy is too tight. Indeed, R-star is set to fall "slightly below zero," the New York Fed chief said, without giving a time frame. This suggests that the U.S. central bank's current policy rate target range of 5.00%-5.25% is already highly restrictive, and will soon need to come down.

☆ The Dollar Is Still King in Europe, and It’s Swaying Interest Rates
▼ + stars: | 2023-05-28 | by ( Tom Fairless | ) www.wsj.com time to read: 1 min

The dollar has lost little of its global dominance despite some countries’ push to use other currencies. Photo: Kerem Uzel/Bloomberg NewsFRANKFURT—It’s not just Americans watching anxiously to see if the Federal Reserve raises rates or the U.S. slides into recession; so are Europeans, and indeed many other countries. That’s because for all the talk of deglobalization and de-dollarization, the dollar still reigns supreme, and financial and trade ties between the U.S. and key partners are as strong as ever. In Europe’s case, they’re even stronger.

☆ 4 of the world's elite investors agree on the biggest risks that will cause the next recession. Here's how they're each protecting clients with over half a trillion in combined assets.
▼ + stars: | 2023-05-05 | by ( William Edwards | Akin Oyedele | ) www.businessinsider.com time to read: +6 min

Below, we've their quotes on the subjects, along with how they said they're protecting their clients' money. I think it is a good chance, more than a little bit, that there will be a conflict, an invasion of Taiwan. Where to invest now: Roeper said he's bullish on aerospace companies because they're having a "pretty solid recovery" right now. The Vanguard Total Bond Market ETF (BND) offers exposure to different areas of the bond market. Where to invest now: Blake said he likes hybrid bonds, investment-grade bonds over a six-12 month duration, and private credit.

☆ Davos draws record crowds, but its relevance is fading
▼ + stars: | 2023-01-16 | by ( Julia Horowitz | ) edition.cnn.com time to read: +7 min

Data from the World Bank shows that global trade of goods and services as a percentage of total economic output peaked that year. A wooden sign on the waterfront of Lake Davos in Davos, Switzerland, on Jan. 8, 2023. Just look to Italy’s new prime minister, Giorgia Meloni, who was installed in October. Those skipping the gathering this year include US President Joe Biden, China’s Xi Jinping, Indian Prime Minister Narendra Modi, French President Emmanuel Macron and UK Prime Minister Rishi Sunak. That raises questions about whether Davos can hang on to its reputation an essential event for the rich and powerful.

☆ Global Trade Is Shifting, Not Reversing
▼ + stars: | 2022-12-31 | by ( Stephen Wilmot | ) www.wsj.com time to read: 1 min

A Volkswagen assembly plant in Mexico, a country where an established manufacturing sector is anchored by the automotive industry. More likely is a continuing reshuffling of trade flows that creates new geopolitical winners—if they are savvy enough to take advantage. Global trade took some big knocks in 2022. The Biden administration rolled out huge subsidies for making semiconductors and electric-vehicle batteries in the U.S.—industries now dominated by Asia. At the company level, following unrest in Zhengzhou, China, Apple accelerated plans to diversify iPhone manufacturing away from the country.

☆ Will 2023 be a better year for the chip sector? Wall Street pros weigh in and share their top picks
▼ + stars: | 2022-12-27 | by ( Zavier Ong | ) www.cnbc.com time to read: +5 min

It's been a tough year for the once-booming semiconductor sector. But several Wall Street pros are urging investors to take a longer-term view on the sector, given the importance of the semiconductor chip in several key secular trends. The bank said the next leg of growth for the sector will be led by government spending on renewable energy and carbon neutrality. The bank named Analog Devices , Marvell Technology , Globalfoundries and Microchip Technology among its top stock picks in the chip sector. TSMC in the headlines One chip stock that has consistently been on investors' radars is semiconductor powerhouse Taiwan Semiconductor Manufacturing Company (TSMC).

☆ ‘The reshoring craze is real’ — These companies should benefit, experts say
▼ + stars: | 2022-12-23 | by ( Michelle Fox | ) www.cnbc.com time to read: +6 min

A lot has been said about reshoring, as companies look to bring manufacturing back to their home countries, particularly the U.S. Reshoring is essentially companies returning operations to their original country from overseas. "The reshoring craze is real, especially as you continue to hear more and more about this general theme of deglobalization," he said. "They sell into the construction of the factory, they sell into the equipment of the factory, the automation of the factory." The company's equipment is needed for big semiconductor manufacturing plants as companies test chips as they are produced, Snyder said.

☆ The renewed 'Made in America' wave is going to make stuff like clothing and electronics more expensive
▼ + stars: | 2022-12-22 | by ( Jacob Zinkula | ) www.businessinsider.com time to read: +6 min

It's in response to the supply chains disruptions companies have faced in recent years. The headaches US corporations have faced are leading more of them to bring their supply chains closer to home and more under their control. Just under half (46%) said they were adjusting supply chains, and around a third (32%) said they were onshoring their workforce. But if more companies shift their supply chains closer to home, this could slowly begin to change. If reshoring companies have to raise wages to attract workers, they may decide to raise prices even further to protect their margins.

☆ Billionaire investor Bill Ackman says the Fed's inflation target isn't realistic anymore - and could result in a brutal recession
▼ + stars: | 2022-12-15 | by ( Theron Mohamed | ) www.businessinsider.com time to read: +3 min

Bill Ackman warned the Fed that slowing inflation to its 2% target is no longer realistic. He raised the prospect of a "deep, job-destroying recession" if the Fed tries to hit its goal. "The @federalreserve 2% inflation target is no longer credible," he tweeted on Wednesday. "Businesses need price stability, but can thrive in a world with 3% stable inflation." Ackman warned that attempting to force inflation down to 2% would likely cause the economy to shrink and unemployment to spike.

☆ Inflation is falling. But the days when prices rose just 2% may never return
▼ + stars: | 2022-12-13 | by ( Julia Horowitz | ) edition.cnn.com time to read: +9 min

Energy prices are pulling back because of fears of a global recession, and the price to ship a container across the ocean has plummeted. In the United States, consumer prices rose at an annual rate of 7.1% in November, the smallest increase since December 2021. Prices rose by 10.7% in the United Kingdom last month, down from 11.1% in October, according to data published Wednesday. But even if this bout of inflation has peaked, economists are warning the world may not return to simpler days when prices barely rose at all. At least for now, supply of critical minerals can’t keep up, which could force prices higher at times.

☆ Transitory inflation talk is back. But economists say higher prices are here to stay
▼ + stars: | 2022-11-30 | by ( Elliot Smith | ) www.cnbc.com time to read: +6 min

Andrew Kelly | ReutersGlobal markets have taken heart in recent weeks from data indicating that inflation may have peaked, but economists warn against the return of the "transitory" inflation narrative. Chief Investment Officer Christian Nolting told CNBC last week that the market's pricing for central bank cuts in the second half of 2023 were premature. "So from our perspective, we think inflation is going to be lower next year, but also higher than compared to previous years, so we will stay at higher levels, and from that perspective, I think central banks will stay put and not cut very fast," Nolting added. Although goods inflation will likely slow, BNP Paribas sees services inflation as stickier in part due to underlying wage pressures. "Admittedly, we think inflation volatility is still likely to fall from its current extremely high levels.

☆ IMF and WTO leaders warn don't 'pull the plug' on global trade
▼ + stars: | 2022-11-29 | by ( Andreas Rinke | ) www.reuters.com time to read: +2 min

Nov 29 (Reuters) - The leaders of the International Monetary Fund and the World Trade Organization on Tuesday warned against the negative impact of deglobalization for the global economy, arguing instead for smart moves to diversify supply chains. "Don't pull the plug on trade that makes us all better." WTO Director-General Ngozi Okonjo-Iweala, speaking at the same news conference, echoed that view, noting a WTO estimate that breaking the global economy into two trading blocs would reduce global gross domestic product by 5% in the longer term. "Retreating from trade, being protectionist will make it harder - not easier - to solve the problems we have now," Okonjo-Iweala said. She said data pointed to even lower global growth next year than the 2.7% rate the IMF had projected in mid-October.

☆ IMF's Georgieva, WTO leader: Don't 'pull the plug' on global trade
▼ + stars: | 2022-11-29 | by ( ) www.reuters.com time to read: +1 min

Nov 29 (Reuters) - The leaders of the International Monetary Fund and the World Trade Organization on Tuesday warned against the negative impact of deglobalization for the global economy, arguing instead for smart moves to diversify supply chains. IMF Managing Director Kristalina Georgieva told reporters after a meeting with German Chancellor Olaf Scholz that globalization was facing its biggest challenge since World War Two in the wake of the COVID-19 pandemic and Russia's war in Ukraine. "Don't pull the plug on trade that makes us all better." WTO Director-General Ngozi Okonjo-Iweala said the WTO estimated that breaking the global economy into two trading blocs would reduce global gross domestic product by 5% in the longer term. Reporting by Andreas Rinke and Andrea Shalal Editing by Chris ReeseOur Standards: The Thomson Reuters Trust Principles.

☆ Singapore minister says country won't take sides as there's no win-win scenario in fractured world
▼ + stars: | 2022-11-17 | by ( Su-Lin Tan | ) www.cnbc.com time to read: +4 min

"Global businesses have a voice and need to make their voice heard, that you prefer an integrated world, and not a fragmented world," Singapore's Education Minister Chan Chun Sing (pictured here in 2019) said. Bloomberg | Bloomberg | Getty Images"It's important to remember that a more interdependent world is a safer world. He cited Russia's war in Ukraine and the World Trade Organization dispute settlement crisis as some of the cracks in the system. "Global businesses have a voice and need to make their voice heard, that you prefer an integrated world, and not a fragmented world," Chan said. "World trade as a percent of GDP had in the past been going up very fast, which contributed to the very low rate of inflation.

☆ The world needs more economic alliances than security ones, analyst says
▼ + stars: | 2022-11-16 | by ( Su-Lin Tan | ) www.cnbc.com time to read: +3 min

Countries should strike up more economic alliances than security and defense ones, as those could make the world "more dangerous," the president of the Center for China and Globalization said on Tuesday. The U.S. for example, could consider joining — or "re-joining" — the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), Henry Wang said at the SALT iConnections conference in Singapore. "The U.S. is the vibe of globalization and [has] always taken the lead on globalization," Wang said. Wang added that there should be more economic alliances and fewer security ones such as the AUKUS, Five Eyes and the Quadrilateral Security Dialogue, an informal strategic alliance. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership is a multilateral trade deal signed in 2018 that was formed after the United States, under the Trump administration, withdrew from the Trans-Pacific Partnership.

☆ Deglobalization is not an option for any one of us, German Chancellor Olaf Scholz says
▼ + stars: | 2022-11-15 | by ( Su-Lin Tan | ) www.cnbc.com time to read: +5 min

Picture Alliance | Picture Alliance | Getty ImagesGerman Chancellor Olaf Scholz and Singapore Deputy Prime Minister Lawrence Wong have taken a united stance on continuing to work with China, but also remain committed to diversification. Scholz said Germany is keen to deepen economic ties with Asia-Pacific, not just China, in line with the pursuit of trade diversification. Olaf Scholz German chancellor"Often these are nothing but protectionism in disguise," Scholz said. Picture Alliance | Picture Alliance | Getty ImagesSingapore's Wong said the U.S. and China both have broad interests across Asia and must find a way to coexist, compete and cooperate peacefully. Picture Alliance | Picture Alliance | Getty Images"And within ASEAN, no country wants to be in a position to have the two sides between China or the U.S.

☆ China's economy could rebound soon, but longer-term growth will be 'deeply challenging'
▼ + stars: | 2022-11-01 | by ( Abigail Ng | ) www.cnbc.com time to read: +1 min

China previously "sailed on" economically while other countries struggled, but the world's second largest economy may have a difficult path ahead, according to one strategist. "China has reached that level of its development where a lot of emerging markets typically find the going getting tougher," said Mark Jolley of CCB International Securities. He pointed to the trend of deglobalization, friction between the U.S. and China as well as the weak global economy. "On both sides of the Pacific we hear a lot of wishful thinking that decoupling will promote rather than hurt domestic growth. We disagree," Ethan Harris wrote in a BofA Global Research note published Friday.

But she said the current priorities for global economic officials were controlling inflation, improving fiscal policy after massive spending early in the pandemic, and finding ways to buffer developing countries against the global rise in interest rates. How do we build fiscal space given that we've used up so much" fighting the initial shock of the pandemic? Studies have begun documenting a potentially permanent blow to labor supply from the pandemic. In the United Kingdom, long-term illness has sidelined more than 377,000 people since the start of the pandemic, about 1% of the labor force. It may be only the beginning of understanding what the pandemic has meant and how the world may need to prepare for the next shock.

☆ Inflation is here to stay despite rising interest rates, Asian business leaders warn
▼ + stars: | 2022-09-27 | by ( Su-Lin Tan | ) www.cnbc.com time to read: +4 min

Iya Forbes | Bloomberg | Getty ImagesInflation in consumer goods will persist as a "new normal" as the global economy undergoes structural changes, Asian business leaders warn. While rising interest rates might eventually temper asset prices, deglobalization and decarbonization could continue to drive up costs for everyday goods, said V. Shankar, chief executive of emerging markets investment manager Gateway Partners. "Despite helicopter money and zero interest rates, the reason why the price of goods stayed down for so long is because of a vast efficient manufacturing agent called China, and the integration of global supply chains." Ho Kwon Ping, executive chairman of Singapore's multinational hospitality group Banyan Tree Holdings agreed, saying higher interest rates are not the new normal, rather, zero or low interest rates were "abnormal." "The world is going, in my view, back to probably a long-term situation of low interest rates, and hopefully, low inflation, but zero inflation, zero interest rates, that's the abnormality, and not the future that we're looking at."

☆ A top fund manager shares how his inflation-focused ETF is navigating crippling price growth and the possibility of 'significant economic destruction'
▼ + stars: | 2022-09-17 | by ( James Faris | ) www.businessinsider.com time to read: +6 min

But David Schassler, who co-manages the fund while also serving as VanEck's head of quantitative investment solutions, isn't taking a victory lap. Schassler added: "This severely limits the Fed's ability to successfully fight inflation without causing significant economic destruction." "It's not only that we own the right assets, but we've been overweight the right assets within the mix of inflation-fighting assets that we own," Schassler said. His three-step process is as follows: identify the right assets to own, optimize the portfolio by diversifying, and adapt to different inflation regimes. Examples of the right assets to own, in Schassler's view, are listed above.

☆ A former top TD Ameritrade technical analyst says stocks have yet to bottom as shares of several major firms remain 'disconnected' from reality — and warns the market could fall another 22%
▼ + stars: | 2022-09-17 | by ( William Edwards | ) www.businessinsider.com time to read: +6 min

The S&P 500 is down 19% in 2022. Since January 3, the S&P 500 is down more than 19%. All except for Apple have underperformed the S&P 500, though they are more on par with the performance of the tech-heavy Nasdaq 100, which is down 28.1% this year. It currently sits at 27.54, and tends to rise when the S&P 500 falls. Markets InsiderWhen all is said and done, Bierman said he thinks the S&P 500 will bottom out somewhere between 3,000-3,300.

☆ A top stock picker at $10 trillion BlackRock shares 3 places to invest now to beat soaring inflation and recession risks
▼ + stars: | 2022-09-16 | by ( William Edwards | ) www.businessinsider.com time to read: +5 min

According to Tony DeSpirito, inflation and recession risks are the biggest threats to stocks. According to Tony DeSpirito, investors today face a two-pronged set of major risks to their portfolios: inflation and recession. The Energy Select Sector SPDR Fund (XLE) offers diversified exposure to energy stocks, while the Vanguard Financials ETF (VFH) offers exposure to the financials sector. According to BlackRock's Ben Bei, a product strategist on the firm's Active Equity Group, healthcare stocks have performed well in prior recessions. Alongside healthcare, DeSpirito recommended keeping some cash on the sidelines as markets continue to digest inflation and the risk of monetary tightening.

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