(a survey among 9,000 German firms) and the statistics of incoming orders for the manufacturing sector at the beginning of September revealed a continuation of the economic downturn in Germany that cannot be ignored anymore.
The business climate dropped to 94.3 points – its lowest value since November 2012.
Incoming orders (see Figure 2 below) point to a severe weakness of investment.
These factors, amongst others, further strengthen the now widespread expectation that the Federal Statistics Office of Germany (Statistisches Bundesamt) will announce negative GDP growth for the third quarter of 2019.
Since this would mark the second consecutive quarterly contraction, it means that the German economy would be officially in a technical recession.
The recession in Germany comes at a time at which the only readily available instrument in the Monetary Union (EMU) to fight recessions, namely monetary policy, is not available anymore.
Moreover, German policymakers, the media, and professional economists have imprudently ignored the downturn, so that a discussion about appropriate countermeasures on the fiscal side remained silenced and valuable time was lost.
The repercussions for several fragile member states of the EMU, such as Italy and France, could turn out to be ominous.”
Historian Bregman: “the Rich are not paying their fair share”
“how to prevent a broad social backlash – the answer is simple – stop talking about philanthropy and start talking about taxes avoidance – taxes – taxes – all the rest is bullshit” (for the top 10%)
“The main reason for the particularly high Irish GDP growth rates lies in the fact that in recent years,
attracted in large part by low corporation tax rates,
a number of large multinational corporations have relocated their economic activities,
and more specifically their underlying intellectual property, to Ireland.”
two possibilities: a race to the tax-bottom (in Germany companies pay 40% income tax consumers pay 19% tax on almost all products… where does it end?)
or
social unrest – we all shall become “criminals” claim land and pay no taxes with reference to Ireland and especially Luxembourg – how well this works for them.
Sorry – this is the EU and if this is happening inside the EU and the EU is not doing anything about it – it is corruption – cancer to democracy – people need to build a wall (or block all streets) to/from Brussels and Berlin and Dublin in order to contain the corruption. (anyone inside may chose to leave or starve)
Historian Mr Bregman: “the rich are not paying their fair share”
“find it quiet a bewildering experience – 1500 private jets flown in here (to Davos) to speak about how we are wrecking the planet”
“i hear people talking the language of participation – justice – equality – transparency – almost no one raises the real issue – tax avoidance and of the rich just not paying their fair share”
“i feel like a fire fighter conference and no one is allowed to speak about water“
“something needs to change here”
“10 years ago the World Economic Forum asked the question ‘what must industry do to prevent a broad social backlash‘ – the answer is very simple – stop talking about philanthropy and start talking about taxes – taxes – taxes”
billionaire Michael Dell: “name me one country where a top marginal tax rate of 70% has actually worked?”
“i am an historian – the answer is: The USA in the 1950s – during Republican President Eisenhower the the top marginal tax rate was 91% for people like Michael Dell – the top estate tax was more than 70% for people like Michael Dell”
“this is not rocket science – we can talk a long time about all this stupid philanthropy themes – we can invite Bono once more – we got to be talking about taxes – taxes – taxes – all the rest is bullshit“
Was Brexit about Tax Avoidance?
(City of London wants to avoid taxes like hell) “the Conservatives (Theresa MayLeader of the Conservative Party from 2016 to 2019) were vehemently opposed to Tax Evasion regulations that were being proposed by the EU.
Back in 2015, Britain rejected plans announced by Brussels to combat “industrial-scale tax avoidance by the world’s biggest multinationals”. Britain had built a corporate tax haven for multinationals that included slashing corporation tax from 28% to 20%, new favorable tax regimes for multinationals with offshore financing subsidiaries, and tax breaks for patent-owning companies. As a result, Britain saw a number of large corporations like Aon, Fiat Industrial, and Starbucks’s European operations, set up headquarters in the UK with a small number of staff in order to take advantage of these tax laws.”
Mario Marcel: High-level policy panel discussion on central bank digital currencies
Remarks by Mr Mario Marcel, Governor of the Central Bank of Chile, at the “High-level Policy Panel Discussion on Central Bank Digital Currencies”, OECD Global Blockchain Policy Forum, Paris, 12 September 2019.
Disruptive technologies in Finance or “FinTech” are transforming the financial industry landscape, challenging traditional business models. These technologies have been able to address some gaps in the traditional financial industry that can be grouped into five categories: Access, Speed, Cost, Transparency, and Security.
Leveraging on open-source technologies and Smartphone penetration, FinTech has seen fast adoption, disrupting all areas of the financial services such as payments, investments, savings & lending, insurance and risk management.
One example of the innovation across different financial services is this research framework from the World Economic Forum. Fintech innovations are identified and grouped into clusters, which in turn are a result of innovation triggered by common themes that cut across financial services. These themes are enabled by different technologies.
Chile: Capital flows and the migration of risks – the recent Chilean experience
Remarks by Mr Mario Marcel, Governor of the Central Bank of Chile, at the Session 4 “Next vulnerabilities: capital flows and the migration of risks to new corners of the financial system” at the High-level policy seminar on “Integration or Framentation? International Capital Flows in the Post-Crisis World”, arranged by the OECD and the Ministry of Finance of Japan, as Governance of G20 in 2019, Paris, 11 September 2019.
a. Which new sources of vulnerabilities are building up a decade after the 2008 crisis?
– Risks associated with the growing importance of non-bank lenders. In some EMEs, this may result in credit lending going informal due to a relatively higher cost in credit provision due to regulation.
– Risks that can emerge from a less developed financial infrastructures outside the regulatory perimeter.
– Risks attributed to disruptive FinTech activities, such as the development of crypto-assets markets, as well as cybersecurity issues.
– Risks and challenges associated with the changing nature of banks’ business model. In particular, those coming from the internationalization of banks’ activities.
b. How to better consider a cost-benefit framework for financial regulation, such as currency-based measures (CBM)?
– While the banking regulation and supervision arising from the 80s-banking crisis was restrictive in several ways, it was supported by sound monetary and fiscal policies.
Mario Marcel: Chile – the view from the Central Bank
Presentation by Mr Mario Marcel, Governor of the Central Bank of Chile, at the “Southern Cone & Andean Opportunities Conference”, arranged by JP Morgan, Santiago de Chile, 26 April 2017.
Current macroeconomic conditions and prospects in the monetary policy scenario
1. The last few months have brought mixed signals for the Chilean economy. On the one hand, 2016 ended in a low tone, with a slowdown in activity and inflation. A series of one-off events extended economic weakness into the first quarter of 2017, lowering forecasts for the year as a whole. On the other, the global outlook appears more favorable, both for the growth of trade partners and terms of trade. This suggests a gradual improvement of economic prospects for the Chilean economy which should be further supported by an expansionary monetary policy as long as inflation remains below target.
