Latest news with #globalEconomy
Bloomberg
23 minutes ago
- Business
- Bloomberg
How Destabilizing Is Israel's War With Iran?
In this week's episode of Everybody's Business, we discuss the conflict's implications for the world at large, including the global economy. Listen and subscribe to Everybody's Business on Apple, Spotify, iHeart and the Bloomberg Terminal.
South China Morning Post
3 hours ago
- Business
- South China Morning Post
Will markets wake up from the Taco bubble before it's too late?
Stock markets have roared back to levels seen before 'Liberation Day' , seemingly on the mere belief that US President Donald Trump always chickens out – otherwise known as Taco – so no harm will be done in the end. However, the Taco trade is based on a bubble. Collective self-deception can work for a while but only when there is enough money behind it. Despite recent talks to de-escalate, the US-China trade war is still pushing the global economy to the brink. A looming recession and higher inflation will mean there is a lot less money available for speculation, especially for the Taco bubble. The Taco trade has worked because three major fund management firms – BlackRock, Vanguard and State Street – control large swathes of the market. These firms have a vested interest in supporting their assets. A lot of money is in circulation due to the US$8 trillion in quantitative easing undertaken by the US Federal Reserve between 2008 and 2022. Moreover, quantitative easing policies are still taking place around the world, which means there is enough money to keep the bubble going. Taco is just another psychological fix to bring back speculative courage. Trump would like to sell the recently concluded US-China trade negotiations in London as a victory for Washington. He talks about a 55 per cent tariff on China versus 10 per cent the other way round, and that rare earth minerals will soon flow to the US again.
Wall Street Journal
a day ago
- Business
- Wall Street Journal
Foreign Investment Faces Third Year of Decline on Tariff Uncertainty, UN Warns
Overseas investment by businesses around the world is at risk of falling for a third straight year as rising tariffs and geopolitical tensions freeze big decisions about where to locate factories, the United Nations warned. In an annual report, the United Nations Conference on Trade and Development said Thursday that foreign direct investment fell 11% in 2024, having also declined sharply in 2023. It said the early signs for 2025 are 'negative,' as businesses face high levels of uncertainty about the duties and other obstacles they will face in moving goods across national borders.
Bloomberg
2 days ago
- Business
- Bloomberg
The Boring Truth About Investing During a Geopolitical Crisis
Escalating fighting in the Middle East has introduced another element of uncertainty for the global economy, leaving investors large and small on edge. US stocks, bonds and the dollar have held steady over the past week. But ahead of what could be a more protracted conflict, I asked my colleague Suzanne Woolley for advice on how investors should be preparing themselves, at least financially.
New York Times
2 days ago
- Business
- New York Times
Trump Seizes on Rate Cuts Elsewhere in Bid to Pressure the Fed
If the Federal Reserve leaves interest rates unchanged as expected on Wednesday, it will be an outlier among major central banks. Policymakers at the European Central Bank, the Bank of Canada and other central banks have all announced rate cuts in recent months, largely in response to the effects of President Trump's trade war, which is expected to slow global growth. Fed officials are also worried about trade and how tariffs and other policies might affect the economy, but they have adopted a wait-and-see approach in order to better understand the impact of his policies. Fed officials cut rates three times last year, by a total of one percentage point, but have been on pause since. The European Central Bank, by contrast, has cut rates eight times over the past 12 months, by a total of two percentage points. The Bank of Canada has cut rates seven times, by a total of two and a quarter points, over a similar period. The fact that other global central banks are cutting more regularly than the Fed has galvanized Mr. Trump and underscored the tricky decision facing Jerome H. Powell, the Fed chair. Mr. Trump has increasingly pointed to the Fed's peers as he tries to jawbone Mr. Powell into cutting rates, referring to him as 'Too Late.' 'I call him 'Too Late Powell' because he's always too late,' Mr. Trump said at the White House on Wednesday, just hours before the Fed announces its latest decision on rates. 'He probably won't cut today,' Mr. Trump said, adding that the Fed should cut rates by 2.5 percentage points, which would be one of the biggest moves in the central bank's history. 'I don't expect anything, maybe he does a little bit,' he said, noting that central banks in Europe had cut more often. Mr. Trump has long beaten up on the Fed and Mr. Powell for not cutting rates quickly enough for his liking. Last month, for example, Mr. Trump cited rate cuts in Europe and China and posted on social media: 'What is wrong with Too Late Powell? Not fair to America, which is ready to blossom? Just let it all happen, it will be a beautiful thing!' But the Fed is grappling with a different set of economic factors than other large economies as it tries to keep inflation stable despite steep U.S. tariffs and maintain a solid labor market. Inflation remains above the Fed's 2 percent target and officials have expressed concern that Mr. Trump's tariffs could reignite price gains. At the same time, the labor market is showing some signs of softening, putting its goals in tension. That balancing act seems to matter little to Mr. Trump, who on Wednesday floated another idea: 'Am I allowed to appoint myself to the Fed?' he asked, somewhat facetiously, before repeating that rates should be slashed.
