Recently, the representative of the UNFPA in Bangladesh stated that the last census to be held in Bangladesh could be in 2021, due to the rapid urbanization of the country and the difficulty of enumeration in cities. The last Population and Housing Census, 2011, conducted by the Bangladesh Bureau of Statistics (BBS) showed the population at 149 million people.
However, should Bangladesh not conduct censuses beyond 2021, we would be losing out on valuable information that indicate where our economy and our demography are heading, and help guide policy matters. The UK is also planning similar changes and researchers are worried at the loss of invaluable info. In a world of ‘denominator management’, a small population (i.e. a small denominator) makes most economic indicators seem rosier. But to truly know where we stand and where we need to be, we need such detailed information and regular censuses, no matter how politically unpalatable or logistically nightmarish the process may be.
In the US, recent census data reveal a number of interesting facts that point to the direction of demographies and the economy. Among them are that White Americans will no longer be the majority by 2043, rural population is decreasing for the first time in the US and Asian & Hispanic populations are growing the fastest, in percentage and absolute terms respectively, becoming the bulwark of tomorrow’s labor force.
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Stocks markets in the US, Europe, South America and the Asia-Pacific are all tumbling, fueled by fears of a global recession.
The outlook for global economic growth appears dim, due to bad news from a number of fronts. In the US, factory activity in the Mid-Atlantic region fell, while US home sales unexpectedly fell in July and new claims for jobless benefits grew more than expected. In Europe, fears that the debt crisis could infect the region’s financial system resurfaced, also US federal and state regulators’ scrutiny of the US arms of Europe’s banks and some European banks’ higher interest rates for US dollar loans, led to worries about spillover of Europe’s debt crisis into the US banking system. The decreasing global consumer demand and markets contagion led to other markets’ falls.
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Stock markets are tumbling all over the world. Along the lines of my prediction in a recent post, stock markets in the US, Europe, Latin America & Asia, along with commodities markets, experienced significant declines.
Wall Street suffered the biggest fall in two years, brought about by massive “sell-offs” by investors, triggered by “great fear” of a US recession, while European markets also fell significantly, driven by the sell-off contagion and worsening debt problems in Europe’s large economies, including Spain & Italy. Latin American and Asian markets were not far behind either, as the sell-off continued on a global spree.
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Global markets are on a downward slide. Stock markets across the globe are either falling sharply (indices in New York, London, Paris & Frankfurt are falling sharply as of writing this piece), or have closed lower (indices in Japan & Hong Kong).
Meanwhile, Spanish and Italian long-term bonds are yielding their record highest – indicating a lack of faith in their sovereign debt by creditors. Also, gold prices have hit a record high, being considered the lone safe investment now.
Having woken up from the keen focus on the US debt limit issue, global markets are now focusing on the general health of the global economy. The poor health of the US economy (slow service sector growth and falling factory order statistics being indicative), the ‘unbailably’ large economies of Spain and Italy, unrest & uncertainty in the Middle Eastern nations – are all compounding the concerns of investors and markets across the globe.
Meanwhile, credit rating agencies Moody’s and Fitch have maintained their AAA rating for the US, albeit with a negative outlook on the ratings. The harsher S&P has not yet released their ratings. On the other hand, Dagong Global Credit Rating Company, China’s leading credit rating agency, has downgraded the US to A from A+ (which was, itself, a downgrade in Nov 2010). With the “Big Three” raters coming into frequent criticisms recently, rating agencies from developing economies are now gaining a stronger voice.
Overall, all these developments are signs of tougher times to come.
The Republican-controlled US Congress, the Democrat-controlled US Senate and the US President Barack Obama are playing a deadly “chicken” game with the issues regarding the US debt ceiling increase, tax raises and spending cuts.
The Republicans want to force the Democrats’ hands in not letting taxes be increased while initiating spending cuts; meanwhile the Democrats have declared dead-in-the-water any proposal that does exactly that. Neither House Speaker John Boehner (Rep) nor President Obama (Dem) has yet managed to find a middle ground acceptable to all parties.
With the August 2 deadline for raising the US debt ceiling or risking credit default looming, either party has to “swerve” or crash horribly into each other. This would have catastrophic consequences for both the US and the global economy.
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A good read of an article that discusses the possibility and impacts of a US debt default, brought about by Congress not increasing the US debt limit. The piece goes on to talk about (albeit briefly) about the global repercussions of such an event. Also, it touches on the likelihood of market movements forcing the govt’s hand.
The graph (not from the article), interestingly, paints a thousand words as it depicts the Lehman bankruptcy and the resultant cost of debt rise followed by the forced TARP announcement, resulting in some relief. Expect to see such curves just around the corner!
I am inclined to believe that the market will force some resolution to the current impasse between the Republicans and Obama’s policies. Irrespective of the outcome, the markets will suffer – default would set off a string of indices, ratings and prices fall, while resolution-imposed austerity measures will also have negative consequences, although not as profound nor catastrophic.
“US Default would Likely Cause …” from The Huffington Post