Rebound and reflation in the global economy

A year ago, there was a pervasive mood of gloom among economists and investors about prospects for the global economy in 2016. China was in the doldrums, and fears of a sharp renminbi devaluation were rife. The oil shock had caused major reductions in capital spending in the energy sector, and consumers seemed reluctant to spend the large gains they were enjoying in real household incomes.

Deflation risks dominated the bond markets in Japan and the Eurozone. In the US, the Federal Reserve seemed determined to normalise interest rates, despite the rising dollar and the weakness in foreign economies.

At the turn of the year, there were forecasts of global recession in 2016. At the low point for activity and risk assets in 2016 Q1, the global growth rate (according to the Fulcrum nowcasts) had dipped to about 2 per cent, compared to a trend growth rate of 4 per cent. It was a bleak period. The dominant regime in financial markets was clearly one of rising risk of deflation.

Since then, however, there has been a marked rebound in global activity, and in recent weeks this has become surprisingly strong, at least by the modest standards seen hitherto in the post-shock economic recovery. According to the latest nowcasts, the growth rate in global activity is now estimated to be 4.4 per cent, compared to a low point of 2.2 per cent reached in March.

The latest growth estimate is the highest reported by the nowcast models since April, 2011 before the euro crisis and the China slow-down hit global activity very hard. This relatively upbeat take on the current state is supported by alternative data sources. For example, the Goldman Sachs Global Leading Indicator has just reached its highest point since December, 2010.

The uptick in global activity growth has, of course, been accompanied by a rise in headline inflation rates in almost all major economies. Recently, I argued that this jump in inflation was still weak and patchy, and almost entirely due to the partial recovery in oil prices, which has been taken further this week by the market reaction to the OPEC decision to reduce oil production.

However, the bond markets have taken the reflation trade increasingly seriously, in part because of the assumed shift towards fiscal easing after the election of Donald Trump in the US. Although the case for a rise in core inflation in 2017 (as opposed to headline inflation) is far from convincing, the recent rebound in global activity may well give the reflation trade a further leg upwards.

Morgan Stanley says that investors have stopped asking is reflation happening? and instead they are now asking will it prove sustainable? It is easy to be sceptical about this. We could be observing nothing more than another short term spike in activity. But, for the moment, the newsflow is clearly improving in a manner that has not hitherto been seen during the faltering recovery from the Great Financial Crash. (Full details of the monthly nowcasts can be found here.)

Nowcasts show recovery in all regions

In the past few years, economic activity in the major regions has not been synchronised. There have usually been one or more sources of geographical weakness that have dragged down the global aggregate.

This no longer seems to be the case. The rebound in activity since early 2016 has been recorded in both the advanced economies (AEs) and the emerging markets (EMs), though the very recent upward spike in the last three months has been mainly in the AEs:

This surge in activity has been most pronounced in the US, but the Eurozone, Japan and China are now all growing at or above their trend rates. This is the first time that all of the major economies have been growing at above trend rates for several years:

Contributions to the rebound in global activity

We can use the nowcasts to calculate the numerical contributions made by each of the major geographical regions to global growth [1]. Here are the results:

Based on PPP weights, China alone is contributing almost half of the total growth in the world economy, with the other emerging economies contributing a further quarter. That leaves about a quarter coming from the AEs, of which more than half stems from the US. Europe and Japan are making a negligible contribution to global growth at the present time.

The following table shows how these contributions to growth have changed since the low point was reached in March, 2016:

All of the contributions are positive, indicating that the improvement in growth has been widespread in the global economy. But the largest contributions to the improvement have once again stemmed from the EMs. China alone has contributed 0.77 percentage points of of the 2.16 points improvement in the global total. Other EMs (especially Brazil and Russia) have contributed 0.90 points, while the AEs have contributed 0.48 points, half of which has come from the US. Again, the contribution from Europe and Japan has been very small.

Can this improvement be sustained?

Attempts to forecast inflexion points in global activity a year or two ahead are not very accurate. Having said that, there are some reasons for optimism that the firmer tone currently identified in the nowcasts might persist during 2017.

As noted above, the main reason for the recent uptick in global growth has stemmed from the EMs, notably from the major easing in fiscal policy in China, and the flattening in deep recessions in Russia and Brazil. The main downside risks to growth prospects in the EMs are a return to tighter credit control in China and an outflow of capital as an aggressive tightening in Fed policy pushes the dollar higher. These risks need to be watched, but do not seem imminent.

In the AEs, fiscal policy is being eased, monetary policy is still accommodative and the manufacturing sector is gaining from firmer corporate investment as the energy shock dissipates. These developments may lead to an upgrade to growth forecasts in the AEs for the first time in many years, provided that a major shock to confidence can be avoided from a shift towards populism in elections in the Eurozone next year.

Overall, we can perhaps be hopeful, though certainly not yet confident, that the global economy will begin to overcome the powerful forces of secular stagnation next year.


[1] We use PPP exchange rates to calculate the weight of each region in global GDP, a procedure which has the effect of increasing the measured contribution on the emerging economies, compared to using market exchange rates to calculate the weights.


‘West Wing’ cast to campaign for Clinton – CNN

Story highlightsSome of the cast will appear alongside Clinton on the trailThey are going to encourage residents to register to voteMembers of the massively popular NBC drama will appear with Democratic nominee Hillary Clinton at several events in Ohio on Saturday and Sunday.Actors Richard Schiff, Allison Janney, Bradley Whitford, Dul Hill, Joshua Malina and Mary McCormack will make campaign stops in the Mahoning Valley, Cleveland, Sandusky and Toledo areas on Saturday, and in the Dayton and Columbus areas on Sunday.Joss Whedon’s Avengers take shots at Trump in get out the vote videoThe actors will talk about why they’re supporting Clinton and encourage the public to register to vote, according to a campaign statement. This isn’t the first time “West Wing” — the plot of which centers on a Democratic presidential administration — clashes with real life. Janney, who played White House press secretary C.J. Cregg, made an unexpected appearance in the White House press briefing room in April. The surprised press corps had been expecting actual White House spokesman Josh Earnest for their usual press briefing. The Emmy Award-winning show has been off the air since 2006, but remains popular even a decade later.


IMF downgrades outlook for US economy – CNBC

The International Monetary Fund is downgrading its forecast for the U.S. economy this year and says America should raise the minimum wage to help the poor and offer paid maternity leave to encourage more women to work.

In its annual checkup of the U.S. economy, the IMF predicts 2.2 percent growth this year, down from 2.4 per cent in 2015, and lower than the 2.4 per cent growth it forecast in April for this year.

Still, IMF managing director Christine Lagarde, noting low unemployment and strong hiring over the past year, says “the U.S. economy is in good shape.” The American economy got off to a slow start this year. A strong dollar hurt exporters by making their goods costlier overseas. Energy companies have also slashed spending due to low oil prices.


More Body Parts Discovered After Seattle Mom Ingrid Lyne’s Murder: Police –

Sanitation workers found human remains in Seattle on Friday, and authorities say they likely belong to a mother who was killed and dismembered last week.

Investigators believe Ingrid Maree Lyne, 40, was killed in her home in the Seattle suburb of Renton by John Robert Charlton, a Seattle man with an extensive criminal record whom she met on an online dating site.

Image: Ingrid Lyne was reported missing on Saturday Image: Ingrid Lyne was reported missing on Saturday Ingrid Lyne, a 40-year-old mother of three who worked as a nurse in Seattle. via Facebook

Charlton is accused of murdering and dismembering Lyne and then driving her body parts to downtown Seattle, where various remains, including a head and a foot, were discovered in a recycling bin April 9.

The body parts have not been positively identified by authorities as those of Lyne, a nurse with three daughters. But police say they don’t have any reason to believe they are of someone else.

The latest grisly discovery was found in a waste container in front of a house close to where a homeowner spotted the other body parts, police said.

Related: Suspect in Dismemberment of Washington Mom Ingrid Lyne Says He Blacked Out

“We’re confident that it is connected to last week’s homicide investigation, which was only three blocks away from where we are standing now,” Seattle Detective Mark Jamieson said Friday.

Image: Aaron Stoltz Image: Aaron Stoltz Seattle Police officer Aaron Stoltz searches garbage and recycling bins, April 15, after human remains were found in a nearby container in Seattle. Seattle Assistant Police Chief Robert Merner said authorities were investigating the probable connection between the remains found Friday and the recent murder of Ingrid Lyne, whose partial remains were found in a recycling bin earlier in the week. Ted S. Warren / AP

Charlton, 37, has a history of convictions for aggravated robbery, felony theft, grand theft auto, assault and larceny. According to court documents, he told police he and Lyne had been dating for about a month, and said they went to a Seattle Mariners game the night of April 8.

Charlton claims he drank to the point of blacking out that night, and woke up the following morning on a sidewalk in Seattle, not sure how he got there. When he was arrested, he had scratches on his chest, hand and forehead, and injuries to his face, police said.

Lyne was reported missing the morning of April 9 by her ex-husband, who stopped by her house to drop off their kids.

Seattle detectives found traces of blood and a 15-inch saw in her bathroom, plus an almost-empty box of garbage bags identical to the ones the body parts were found in.

Charlton is being held on $2 million bail and faces at least 28 years in prison. He is also charged with stealing Lyne’s car, which was found in Seattle on Monday night.

A GoFundMe page set up for Lyne’s three young daughters has raised nearly $200,000.


Ample Ideas For HVAC Around The Nation

Facilities Maintenance can help. Has the time come to replace your aging HVAC system? Do you want to upgrade the efficiency of your current set-up? Are you having issues with rooms which are uncomfortable to live in? Regardless of why you are here, this article has the tips and tricks you need to succeed.

Look for discounts wherever possible. HVAC systems can be rather costly, so you’ll want to seek out whatever discounts and deals that may be out there. When shopping around, ask about any current specials running, and look for discounts that are related to ENERGY STAR compliance. Both can save you a lot of cash.

When seeking a new contractor, ask loved ones for referrals. They’ll often have already had someone in for similar work and will know who to trust and who to avoid. Ask co-workers or other people you trust in your community for some references if your family hasn’t used anyone.

Clean the coils of your condenser fan each month. Except when you do superficial cleaning, you need to always make sure the power is off on the unit. Also, it is important to clear the outside condenser unit from any debris that maybe trapped inside.

When you are no longer using your outdoor air conditioning unit, be sure to protect it with a tight cover. This will keep it free of frost, debris and snow so that you’ll have a working unit when the spring comes and you are ready to uncover it and use it again.

Do you hear a clicking sound when your fan is turning? This may mean that there is something in the way of the blades of the fan. If it gets so bad that the blade bends, you must replace it, just unbending it will leave the fan unbalanced and can cause further issues.

Be sure to check your evaporator coil drains frequently when your air conditioner is running. If this tube backs up, you can find water damage to your walls, floors and ceilings. If you end up with mold just use a solution of bleach and water to clean out the tube.

Make sure that the HVAC contractor you plan to hire does not use subcontractors to do their work. Many people use this as an excuse to shirk their responsibility in the event that something goes wrong when your system is being worked on. Only allow this if there is a note in the contract about what will happen if there is an issue.

There are sizing calculators available to determine the proper sized system for your home. Buying a unit which is too big reduces efficiency. Check your manual to figure out what the rating is from the manufacturer to be sure you’re getting the right information.

In order to cheaply cool your home, turn the temperature up. If you take a few showers a day or just drink a cold ice water, you’ll find that you’re saving a lot of money on your utility bills by keeping the thermostat a little higher than usual in your home.

Consider putting a standing fan next to your bed if you want to turn off your air conditioning at night to save money. You can set it to oscillate from your toes to your head, blowing cool air over your body and letting you sleep comfortably all night long.

Make sure that the HVAC contractor you plan to hire does not use subcontractors to do their work. Many people use this as an excuse to shirk their responsibility in the event that something goes wrong when your system is being worked on. Only allow this if there is a note in the contract about what will happen if there is an issue.

Looking for an efficient way to cool your home? Consider installing a whole-house evaporative cooler. They use water to cool air instead of traditional chemical coolants, using a ton less energy to cool your home than those other units. That said, they do work best in dry climates and not at all in humid ones.

Be sure to check your Filter Check light frequently on any stand-alone units. If it is on, turn the unit off as you can’t operate it without a filter in place. Don’t operate the unit if the filter is still wet, though clean the filter carefully and return it to its proper location.

If you feel like you are spending too much money on your cooling and heating, there is a simple way to reduce this cost. Raise or lower the temperature depending on the season. A single degree in temperature change can equate to almost a nine percent savings in cooling and heating costs.

Never hire an HVAC contractor that does not hold a valid license from your state. There are people out there that will offer to do less expensive work since they have no license. While it may seem like a bargain, you will have lots of issues in the event that something goes wrong.

When you hire a contractor to do a job, be sure to listen to what they tell you. For example, they can give you advice on how to keep your HVAC in working order. Ask about maintenance tips and how often you should be cleaning or servicing the unit.

You should focus on finding an HVAC contractor that can offer you a warranty on the work they are doing. This is a sign that they are confident in their ability to get the job done well. This will protect you in the event that is not done right and needs to be fixed.

Don’t just hire the first contractor you meet or call. Before going ahead with one, be sure to compare multiple options. They should meet all of your requirements, be it offering a great guarantee to being able to come and do the work on your budget and within your timeline.

Check the licensing of any HVAC company that you plan to hire. Start by making sure they are fully licensed. They should be in compliance with your state’s business laws. Good HVAC companies should be fully insured. This is to protect their company, their employees, and their customers should anything happen when they are performing a service at the home of a customer.

Proper maintenance is key to having a good working HVAC system. Don’t let your system go bad, use the tips here to inspect it for problems to ensure that you don’t have costly repairs down the road. Keep checking it and remember the tips here to use as guide so you know what to look for.

facilities maintenance


Juneau mayor died of natural causes, police say – Fox News

Police awaiting autopsy results

The mayor of Alaska’s capital city appears to have died from natural causes, police said Wednesday, shortly after an autopsy was completed.

The announcement came one day after officials said newly-elected Mayor Stephen “Greg” Fisk’s body was found with evidence of external injuries.

Officials at the time tentatively ruled out gunshots, drug use or suicide as a cause of death.

According to the findings, the external injuries sustained by Mayor Fisk were consistent with an injury due to falling or stumbling into objects. No foul play is indicated,” police said in a statement ahead of a news conference in Juneau.

Fisk, 70, was found by his adult son Ian in the older man’s Juneau home Monday afternoon.

There was no sign of forced entry into Greg Fisk’s home.

Police did not describe Fisk’s injuries, saying they were waiting on an autopsy report from the state medical examiner in Anchorage. Police spokeswoman Erann Kalwara said investigators were hopeful the report would be completed in a couple of days.

Fisk, who was elected to a three-year term as Juneau mayor in October, lived alone in a house above the city’s downtown. His son went to his father’s home to check on him Monday after the mayor had missed previously scheduled appointments.

In their official statement Monday, police acknowledged rumors of an assault but said those rumors were “speculation.”

An attack was “one of the possibilities out there, but there’s others that could have happened,” Police Chief Bryce Johnson told theJuneau Empire newspaper. “There could’ve been a fall. There’s lots of things that would cause it.”

Kalwara told the Associated Press that in some cases, it’s obvious at the scene that a person died of natural causes.

“In this case, we just can’t confirm that yet or rule anything out,” she said Tuesday afternoon.

Citing Johnson, however, Kalwara said there was no apparent gunshot wound and “nothing at the scene to indicate there were drugs involved.”

Likewise, “There’s nothing on scene to indicate it was a suicide,” she said.

The Empire reported that Fisk’s next-door neighbors said they hadn’t seen the mayor all day Monday and hadn’t heard any disturbance to indicate an assault. Chief Johnson also told the paper that investigators had found no evidence of a break-in.

Ian Fisk said in an email statement that his family is grieving privately.

“We sincerely appreciate the support of the community and we recognize that, as would be the case with any public figure, his death brings a lot of attention,” Ian Fisk wrote. “At this time we have no reason to speculate as to the cause of his death and are awaiting the results of his autopsy. Meanwhile I will not be responding to any further media requests of any kind, and ask for your understanding.”

Fisk, a fisheries consultant, handily defeated incumbent Merrill Sanford in the Oct. 6 election to become mayor.

Bob King, a veteran of Alaska politics who worked as press secretary to former Gov. Tony Knowles and as a fisheries aide to former U.S. Sen. Mark Begich, was Fisk’s next-door neighbor, friend and campaign manager.

“He wanted to focus on strengthening Juneau’s role as Alaska’s capital city,” King told The Associated Press on Tuesday.

Fisk wanted to encourage development of Juneau’s waterfront and pledged to push the federal government to restore jobs that had been moved to Seattle from Juneau, King said.

Fisk also intended to work for more affordable housing in the city whose downtown is bounded on one side by the ocean and on the other by mountainsides.

“He had a lot of different thoughts and he really jumped into it,” King said.

Fisk had served on boards and commissions but had never run for office. When he asked King to be his campaign chairman, King didn’t give Fisk much of a chance but helped out in minor ways, he said. Fisk ran an active campaign, going door-to-door to speak to voters and hear their concerns. Fisk ended up taking nearly two-thirds of the vote.

“He earned every one of those votes that he got,” King said.

Fisk was sworn in Oct. 20, said city clerk Laurie Sica. Deputy Mayor Mary Becker was named acting mayor.

“I think this was a terrible day for all of Juneau,” Downtown Business Association president Jill Ramiel told the Juneau Empire . “He was never afraid to say what he thought.”

The Associated Press contributed to this report.


Source: Suspect spoke of ‘baby parts’ after Planned Parenthood shooting – CNN

Story highlightsOfficial says suspect expressed anti-abortion and anti-government views Suspect Robert Dear, 57, is held without bail and set to appear in court Monday afternoonPlanned Parenthood says suspect was motivated by opposition to abortionDear, 57, told them he has anti-abortion and anti-government views, but that doesn’t mean those opinions were his motive for allegedly shooting up the Colorado Springs clinic on Friday, the official said. It’s too early to tell, as investigators are still processing evidence.

After a nearly six-hour bloody standoff that left one police officer dead and five others wounded, the accused shooter dropped his gun after a SWAT team drove up an armored police vehicle, a BearCat, and cornered him, the official said.

Planned Parenthood shooting suspect Robert Dear.Planned Parenthood shooting suspect Robert Dear.Law enforcement officers found propane tanks in the area of Dear’s car in the parking lot and believe he was trying to shoot them to cause an explosion, the official said.

More about Planned Parenthood

‘Crime against women’In the absence of an announced motive, public officials in Colorado and beyond are drawing their own conclusions about the attack.

It was a “crime against women receiving health care services,” said Attorney General Loretta Lynch. She pledged the full resources of her office to investigate.

“Inferences (could be made) from where it took place,” Colorado Springs Mayor John Suthers told the Denver Post.

Vicki Cowart, president of Planned Parenthood of the Rocky Mountains, went beyond an inference, saying the shooter “was motivated by opposition to safe and legal abortion.”

A hermit’s shantyDear is being held without bail in a Colorado Springs jail, according to the El Paso County Sheriff’s Office. He is due to appear in court Monday afternoon.

Shown in police photos with dark hair and a fluffy white beard, the suspect appears to have lived a long time in rural solitude in the Carolinas, then more recently in Colorado. Over a decade ago, he had some run-ins with the law while living in South Carolina, but was never convicted.

Photo of Robert Lewis Dear's cabin in Black Mountain, North CarolinaPhoto of Robert Lewis Dear's cabin in Black Mountain, North CarolinaIn 1997, Dear’s wife accused him of domestic assault, although no charges were pressed, according to records from the Colleton County Sheriff’s Office in South Carolina.

In 2002, Dear was charged with being a peeping tom; those counts were dismissed.

In 2003, he was arrested and charged with two counts of animal cruelty, but he was found not guilty in a bench trial.

He later made his home in a hermit shanty in the mountains of North Carolina, CNN affiliate WLOS reported. It published a photo of a small, basic cabin in the woods of Buncombe County.

The sheriff’s office there knew Dear from a single a civil citation issued in 2014 for allowing his dogs to run wild.

Fear, horror, disbelief among witnesses

Anti-Obama brochuresAbout a year ago, Dear chose the crossroads community of Hartsel, Colorado, as his home, according to public records. It is nestled in grassy plains and rolling foothills framed by Rocky Mountain ranges and is about an hour and 20 minutes’ drive from Colorado Springs.

Dear bought a spread — 65 miles west of the Planned Parenthood clinic — for $6,000.

Zigmond Post, a neighbor, said Dear brought him some anti-Obama pamphlets once. “That’s about all I’ve run into him,” he said.

It’s safe to say that few people knew who Dear was until he walked out of the Colorado Springs Planned Parenthood after allegedly shooting 12 people and terrorizing many others.

Scanners relay police plansConversations captured over the police scanner gave glimpses into the drama inside the clinic as well as the strategic debate about how to stop the suspect and get his hostages to safety at the same time.

Joan Motolinia’s sister was among those inside. She called him Friday afternoon, and he could hear the shooting in the background, he said.

“She couldn’t say much because she was afraid,” Motolinia said, shedding tears as he recounted the call.

Beloved officer killedOfficer Garrett Swasey died along with two civilian victims in the hail of bullets. He was an elder in his church and a former figure skating artist.

Swasey was a University of Colorado Colorado Springs officer who rushed to the clinic to offer his assistance. “There was no way any of us could have kept him here,” said UCCS Police Chief Brian McPike. “He was always willing to go…he had an enthusiasm that was hard to quell.”

Colorado Springs Police Chief Peter Carey said that the identities of the other two victims probably won’t be released until Monday, after autopsies have been performed.

Obama: ‘Enough is enough’In a statement on Saturday, President Barack Obama offered praise for Swasey, condolences to the families of the victims and condemnation of the attack as another example of gun violence.

“This is not normal. We can’t let it become normal,” Obama said. “If we truly care about this — if we’re going to offer up our thoughts and prayers again, for God knows how many times, with a truly clean conscience — then we have to do something about the easy accessibility of weapons of war on our streets to people who have no business wielding them.

“Period. Enough is enough.”

Planned Parenthood videosPlanned Parenthood has recently endured intense political and social opposition.

Eight undercover videos released over the summer by anti-abortion activists have stirred caustic criticism against the reproductive health clinic. It has even filled the halls of Capitol Hill, where conservative politicians have demanded its defunding.

Planned Parenthood has said the videos, which alleged illegal fetal organ sales, were heavily edited and inaccurate.

At least three of the organization’s buildings have been vandalized since September, not long after the last video appeared.

CNN’s Ben Brumfield wrote and reported and Pamela Brown reported. CNN’s Kevin Conlon, Greg Botelho, Faith Karimi, Joe Sutton and Andreas Preuss contributed to this report.