NIR: Reality or mirage?; U.S. FED rate remains near zero Posted on March 18, 2009March 19, 2009 by Your Financial FactSheet Jamaica Gleaner: “NIR: Reality or mirage? – Economy bears heavy burden for BOJ’s reserve” In the previous instalment of this series of articles, we pointed to the seeming attempt, early in the decade by the central bank, at obfuscation over its use of CDs in the market and the impact of these instruments on the BOJ’s balance sheet. However, since 2004, the auditors have labelled the Bank’s CDs as open market liabilities. CNNMoney.com: “FED maintains near zero interest rate policy” Information received since the Federal Open Market Committee met in January indicates that the economy continues to contract. Job losses, declining equity and housing wealth, and tight credit conditions have weighed on consumer sentiment and spending. Jamaica Observer: :”Statin reports 0.8% inflation for Feb despite major price hikes in Jan” The Statistical Institute of Jamaica (Statin) reported 0.8 per cent headline inflation for the month of February, reflecting only 0.1-1.1 per cent movement in food and other grocery items despite distributors increaseing prices by six to 20 per cent during the month of January.
How the BOJ talked big and produced little – Pt I Posted on March 13, 2009March 17, 2009 by Your Financial FactSheet Jamaica Gleaner: “How the BOJ talked big and produced little – Pt I” In response to the current global financial crisis, governments around the world have, and are, putting in place both fiscal and monetary stimuli to mitigate the impact on their respective economies. In Jamaica, our Government has recently announced, and implemented, several fiscal measures in this regard. Jamaica Observer: “Should Jamaica Continue to Place Faith in the Credit Rating Agencies?” Earlier this month Moody’s Investors Services downgraded foreign and local currency ratings on Jamaica’s government bonds, citing the deteriorations in the country’s fiscal and debt positions amid the global crisis. The news of the downgrade was met largely with indifference in Jamaica because it was generally expected. Jamaica Observer: “World Bank Crisis Reveals Growing Finance Gaps for Caribbean Countries” Developing countries like those in the Caribbean face a financing shortfall of US$270-700 billion this year, as private sector creditors shun emerging markets, and only one quarter of the most vulnerable countries have the resources to prevent a rise in poverty, the World Bank has said. Jamaica Observer: “Modern-day depression could further reduce US and Jamaica stock markets” Just over three months ago, in a December 7th article in the Sunday Observer entitled “How will the worst US recession since World War II affect Jamaica and your investments?”
The grim global equaliser Posted on March 11, 2009August 13, 2010 by Your Financial FactSheet Jamaica Observer: “The grim global equaliser” “With these words I make my covenant with you; I promise that never again will all living beings be destroyed by a flood, never again will a flood destroy the earth. I am putting my bow in the clouds. It will be the sign of my covenant with the world.” Genesis 9:11 and 13. Jamaica Gleaner: “FSC to free up unit trusts regime” Rohan Barnett, the new boss of Jamaica’s Financial Services Commission (FSC), hopes to soon lift the decade-old moratorium on new unit trusts, while the FSC continues to work with stakeholders on the longer-term matter of untangling knotty taxation questions that have stymied the creation of mutual funds here. Jamaica Gleaner: “Bernanke says regulatory overhaul needed” The United States’ financial regulatory system must be overhauled to strengthen oversight of banks, mutual funds and large financial institutions whose collapse would put the entire economy in peril, Federal Reserve Chairman Ben Bernanke said yesterday. BusinessWeek, Bovino: “The Global Economy: Strong Headwinds for Europe and Asia” Although the U.S. entered recession first, Britain and Japan—and to a lesser extent Europe—now face even larger hurdles.
World Bank says global economy will shrink in ’09 Posted on March 10, 2009March 12, 2009 by Your Financial FactSheet Jamaica Gleaner: “World Bank says global economy will shrink in ’09” The World Bank said Sunday that the global economy will shrink this year for the first time since World War II and that the global financial crisis will make it tougher for poor and developing nations to access needed financing. Jamaica Observer: “Government must prepare the nation for economic survival” The government must prepare the people for the shocks of the coming national budget and do it early. It has no control over the global economic crisis which will impact heavily on the budget – neither did the PNP Opposition when it formed the government – but government has a responsibility to do everything possible to cushion the intensity of the impact. BusinessWeek, Bovino: “The Economy: A Scorecard for the Global Slowdown” One year ago, it seemed pretty clear to Standard & Poor’s Ratings Services that the U.S. was in a recession. That has been confirmed by the National Bureau of Economic Research, which has said that the U.S. recession began in December 2007.