The Corliss Group PR Code 85258084198: Standard Chartered warning chief gives over UAE asset bubbles
0 view | +0 today
Follow
Your new post is loading...
Your new post is loading...
Scooped by robertfourtier
Scoop.it!

Another deficit of clear thinking, Financial Blog Corliss Online Group

 Philip Bowring is appalled by the report on fiscal planning that seeks to preserve the status quo, to protect mega infrastructure spending, yet utterly fails to address our critical ...
robertfourtier's insight:
Source: https://exploreb2b.com/articles/financial-blog-corliss-online-group-another-deficit-of-clear-thinking-among-hong-kongs-fiscal-planners Philip Bowring is appalled by the report on fiscal planning that seeks to preserve the status quo, to protect mega infrastructure spending, yet utterly fails to address our critical challenges In 40 years of covering Hong Kong budgets and fiscal issues, I have never seen a document as misleading and contentious as the report of the Working Group on Long Term Fiscal Planning. It is a crude attack on health and welfare spending in order to find money for already bloated infrastructure spending. To add insult to injury, the group is mainly comprised of officials and academics enjoying huge health and pension featherbeds at public expense. The starting point for the report is true enough - that Hong Kong has an ageing population and one that is growing only slowly. This has been known long enough. The government has been aware that years of having a very low fertility rate has been a major factor in ageing - but has done nothing to address it. The document goes on to present a scare story of ever rising deficits caused by a stagnating workforce and rising demands for health and welfare spending. Yet it accompanies this with projections for sustained increases in capital works. The non sequitur is backed by references to guidelines laid down by Philip Haddon-Cave in the 1970s - that public spending should be no more than 20 per cent of gross domestic product, and that there should be a significant surplus on the operating budget to provide funds for capital works (in addition to capital works paid by capital revenue). Haddon-Cave, a realist, not an ideologue, would be appalled by official inability to see what has changed. Then, Hong Kong had a young, fast-growing workforce and the need for more infrastructure to support an economy based on manufacturing and merchandise trade. Today, we have no manufacturing, a port which is past its peak, and financial and other high-value services whose input needs are not primarily related to concrete. read related content: http://corlissonlinegroup.com/ http://corlissonlinegroup.com/blog/ http://corlissonlinefinancialmag.tumblr.com/
more...
No comment yet.
Scooped by robertfourtier
Scoop.it!

The Corliss Group PR Code 85258084198: Standard Chartered warning chief - Slashdot

The Corliss Group PR Code 85258084198: Standard Chartered warning chief gives over UAE asset bubblesStandard Chartered's local chief executive has warned that preventing asset bubbles will be the biggest challenge facing UAE authorities as the...
robertfourtier's insight:

 

Standard Chartered's local chief executive has warned that preventing asset bubbles will be the biggest challenge facing UAE authorities as the local economy expands.

 

Research from the British bank, which generates most of its income from emerging markets, said consumer leverage now represents a bigger proportion of the UAE economy than before the financial crisis and added that some measures to protect consumers would be welcome.

 

With the property crash and attendant financial crisis now firmly in the past, maintaining the current pace of economic growth required attention from the Government, said Jonathan Morris, the bank's chief executive for the UAE.

 

"The challenge the Government faces now [is] quite difference from the challenges in the recovery period," he said.

 

"A challenge for the Government will be managing growth and managing inflation."

 

Asset bubbles were likely to be the biggest concern, he added. Mr Morris said Standard Chartered did not see a bubble developing in house prices, saying the market was experiencing a "normal pricing dynamic" led by demand.

 

However, the bank said it was in favour of measures such as levies on property sales similar to those in Hong Kong and Singapore, where stamp duties are imposed on overseas buyers as a means of controlling speculation.

 

Standard Chartered said the ratio of household debt to gross domestic product increased to around 6.16 per cent last year.

 

That compares to a ratio of 5.8 per cent in 2008, before the Dubai property crisis.

 

However, interest rates are substantially lower now than then, and household debts represent a lower share of assets.

 

The ratio of household debt to assets has fallen for the past few years, and is around 25 per cent now, compared with 30 per cent in 2008. The IMF estimates that the UAE economy will decelerate this year to 3.1 per cent growth in real terms from 3.9 per cent in 2012.

 

But lending by the banking sector has accelerated significantly this year, with new credit in the first six months of 2013 higher than during the 18 months before that.

 

There has been significant growth in bank lending in the first half of the year, with net loans and advances growing by 4.3 per cent in the year until the end of June, according to the latest data from the Central Bank.

 

Consumer credit increased in June by Dh3.8 billion to Dh276.2bn, the biggest monthly jump on record and the sixth straight month of increases, which banks attributed to increased retail spending as the job market strengthens.

 

Banks were attempting to increase the volume of wholesale banking transactions to offset falling margins, Mr Morris added.

 

"The cost of funding more generally for banks has come down and loan impairments are coming down," he said.

 

"But margin compression is very real. We're having to run harder to stand still. That's a story we're seeing across the banks."

more...
No comment yet.
Scooped by robertfourtier
Scoop.it!

Corliss Online Group Financial magazine: Real role models of the global economy

Corliss Online Group Financial magazine: Real role models of the global economy | The Corliss Group PR Code 85258084198: Standard Chartered warning chief gives over UAE asset bubbles | Scoop.it
Economic policymakers seeking Successful models to emulate apparently have an abundance of choices nowadays.
robertfourtier's insight:

The world's current-account balances must ultimately sum up to zero. In an optimal world, the surpluses of countries pursuing export-led growth would be willingly matched by the deficits of those pursuing debt-led growth. In the real world, there is no mechanism to ensure such an equilibrium on a continuous basis; national economic policies can be (and often are) mutually incompatible.

When some countries want to run smaller deficits without a corresponding desire by others to reduce surpluses, the result is the exportation of unemployment and a bias toward deflation (as is the case now). As external imbalances grow larger, each phase of this cycle becomes more painful.

The real heroes of the world economy – the role models that others should emulate – are countries that have done relatively well while running only small external imbalances.


Read more: http://robertfourtier.blog.fc2.com/blog-entry-1.html

more...
No comment yet.