US equities will drive market volatility and gains

Significance The combination of more COVID-19 cases in parts of the United States and unprecedented monetary and fiscal stimulus is straining the dollar. In parallel, the euro is benefiting from a push for closer euro-area integration. Nevertheless, the US MSCI equity index has risen by 6.3% this year, with the tech sub-index gaining 25%. Europe’s MSCI equity index is down 7.4%. Impacts ‘Big Tech’ accounts for 40% of the market capitalisation of the S&P 500 equity index and looks set to continue powering the equity rally. The world stock of negative-yielding sovereign and corporate bonds has almost doubled from end-February to over USD15tn; it may rise more. The euro reached its highest level to the dollar in over two years this month; Europe’s stimulus package should help it maintain momentum. Dollars make up nearly two-thirds of the world stock of foreign exchange reserves; this share will fall very gradually, over years.

Subject Prospects for government intervention in the airline industry. Significance The leading Gulf airlines -- Emirates, Qatar and Etihad -- have risen rapidly over the last decade to become major players in the world air transport business. This has been at the expense of long-haul carriers in the United States, Europe and Asia-Pacific. US and European airlines are demanding action that could threaten liberalisation of the international airline industry. Impacts Neither the US government nor EU authorities are likely to unravel the network of international air transport agreements. Yet both Democratic and Republican politicians will be sensitive to demands from core constituencies. Further airline industry liberalisation and growth of Gulf based airlines may therefore be delayed.


Subject Crypto market dynamics. Significance The market capitalisation of cryptocurrencies fell to below 250 billion dollars on April 6 from a record high of 827 billion on January 7. Greater regulation, coupled with more volatile global equity markets and the April 15 US tax filing deadline had prompted substantial cryptocurrency selling. However, the valuation has since recovered to more than 325 billion dollars, supported by the US deadline passing, a seminal paper on April 10 by Blossom Finance declaring bitcoin investment allowable under Sharia law and, most importantly, interest in uses for blockchain continuing to grow. Impacts Many crypto hedge funds have shut, many ICOs have failed and this will continue, but among the blockchain firms there will be big successes. The Swiss stock exchange plans to launch a cryptocurrency version of the Swiss franc; Switzerland will expand as an ICO hub. The rise in financial market volatility since February will intensify and persist as global trade tensions are increasing.


Subject Prospects for the global economy to end-2019. Significance The world economy is likely to grow by around 3% this year. This is the lower end of the 3.0-3.5% range expected six months ago. World trade is weakening amid the US-China conflict and productivity is not picking up. China is expanding fiscal policy and others may follow, perhaps Germany and the United States. Monetary tightening is off the table and some countries may loosen policy. However, this will mainly shore up growth rather than raising it.


Subject Global reserves outlook. Significance The growth of the foreign-exchange reserves of emerging and developing economies was a closely followed topic in international finance and policymaking circles in the 2000s. A new strand of academic literature suggests it might be in for a renaissance. Impacts The world will soon take more notice of the worsening US net external debt load. Paradoxically, the US economy generates these liabilities in part because the world demands them. US dollar depreciation will put domestic political pressure on large dollar reserve holders.


Subject Downward pressure on bond yields. Significance Government bond yields rose in late 2016 as a result of higher inflation and expectations of US fiscal stimulus. However, although GDP growth is picking up in the euro-area, the United States and Japan, inflation pressures remain subdued and US fiscal plans have been delayed. Combined with falling political risk in the euro-area, this has pushed yields down and the global stock of negative-yielding sovereign debt is rising again. Moreover, ultra-accommodative monetary policies continue to supress yields, distorting asset prices and contributing to the mispricing of credit risk. Impacts China’s attempts to crack down on financial leverage is seen as a bigger risk by Bank of America Merrill Lynch than a euro-area break-up. Despite the uncertainty of the UK election result, markets have been calm and the S&P 500 equity index hit a new intraday high on June 9. The loss of momentum behind reflation trading has led the dollar index to fall by 5% this year and it will remain under pressure. US technology shares fell sharply on June 9, raising concerns that their surge this year leaves them overvalued and at risk of a correction.


Significance The authorities have implemented a range of measures to prevent transmission, introduced a large fiscal stimulus package and established a multi-stakeholder task force to oversee the response and recovery. Help has also been forthcoming from the IMF, which has disbursed funds under its Rapid Financing Instrument. Impacts The continued rise of COVID-19 infections in the United States makes an early recovery of tourism unlikely. Elections may be called in the near term despite health and economic worries surrounding COVID-19. Rising levels of violent crime may work against the JLP’s electoral support.


Significance The lifting of most COVID-19 restrictions, the revival in intra-EU tourism and a strong rebound in private consumption are key factors behind the optimistic forecasts. The outlook, nevertheless, is uncertain due to COVID-19. In addition, southern European economies are not expected to return to pre-pandemic growth levels until 2023. Impacts Euro-area inflation is unlikely to rise above 2% over the coming years. Southern countries risk facing a new 'brain drain' wave once international travel returns to pre-pandemic levels. EU states with closer trade relations with the United States will benefit from the US fiscal stimulus and the appreciation of the dollar.


2021 ◽  
Vol 20 (1) ◽  
Author(s):  
Brittany Kovacs ◽  
Lindsey Miller ◽  
Martin C. Heller ◽  
Donald Rose

Abstract Background Do the environmental impacts inherent in national food-based dietary guidelines (FBDG) vary around the world, and, if so, how? Most previous studies that consider this question focus on a single country or compare countries’ guidelines without controlling for differences in country-level consumption patterns. To address this gap, we model the carbon footprint of the dietary guidelines from seven different countries, examine the key contributors to this, and control for consumption differences between countries. Methods In this purposive sample, we obtained FBDG from national sources for Germany, India, the Netherlands, Oman, Thailand, Uruguay, and the United States. These were used to structure recommended diets using 6 food groups: protein foods, dairy, grains, fruits, vegetables, and oils/fats. To determine specific quantities of individual foods within these groups, we used data on food supplies available for human consumption for each country from the UN Food and Agriculture Organization’s food balance sheets. The greenhouse gas emissions (GHGE) used to produce the foods in these consumption patterns were linked from our own database, constructed from an exhaustive review of the life cycle assessment literature. All guidelines were scaled to a 2000-kcal diet. Results Daily recommended amounts of dairy foods ranged from a low of 118 ml/d for Oman to a high of 710 ml/d for the US. The GHGE associated with these two recommendations were 0.17 and 1.10 kg CO2-eq/d, respectively. The GHGE associated with the protein food recommendations ranged from 0.03 kg CO2-eq/d in India  to 1.84 kg CO2-eq/d in the US, for recommended amounts of 75 g/d and 156 g/d, respectively. Overall, US recommendations had the highest carbon footprint at 3.83 kg CO2-eq/d, 4.5 times that of the recommended diet for India, which had the smallest footprint. After controlling for country-level consumption patterns by applying the US consumption pattern to all countries, US recommendations were still the highest, 19% and 47% higher than those of the Netherlands and Germany, respectively. Conclusions Despite our common human biology, FBDG vary tremendously from one country to the next, as do the associated carbon footprints of these guidelines. Understanding the carbon footprints of different recommendations can assist in future decision-making to incorporate environmental sustainability in dietary guidance.


Significance Follow-on action from Washington and responses from foreign actors will shape the US government’s adversarial policy towards China in semiconductors and other strategic technologies. Impacts The Biden administration will likely conclude that broad-based diversion of the semiconductor supply chain away from China is not feasible. The United States will rely on export controls and political pressure to prevent diffusion to China of cutting-edge chip technologies. The United States will focus on persuading foreign semiconductor leaders to help develop US capabilities, thereby staying ahead of China. Washington will focus on less direct approaches to strategic technology competition with China, notably technical standards-setting. Industry leaders in the semiconductor supply chain worldwide will continue expanding business in China in less politically sensitive areas.


2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Hisham Said ◽  
Aishwarya Mali ◽  
Ajay Deshmukh

PurposeConstruction trade unions have been a vital force in improving the job standards and wellbeing of trade workers. However, the union membership in the construction industry has dropped by half between 1983 and 2017. The objective of this study is to identify and assess the controlling factors of construction electrical trade unionization in the United States.Design/methodology/approachThe study involved four main steps. Literature review and industry townhall meetings were conducted to identify the electrical trade unionization factors. A new unionization trend metric was developed using available union market share data to quantify the growth and decline of local unions. Mixed-mode surveying was used to collect questionnaire and interview data on the unionization factors in different local units of the electrical trade union. Finally, the survey data from the questionnaire and interviews were merged and their correlation with the unionization trend data was assessed.FindingsThe study found that the unionization of this specialty trade is dependent on increasing the crew ratio, expanding the non-apprenticeship union membership program, organizing larger contractors, and continuing the union focus on public and heavy industrial projects.Originality/valueThe study contributes to the construction management body of knowledge by providing a data-driven industry-wide assessment of the factors that affect electrical construction unionization. The study advances the understanding of construction trade unions by narrowing the theory-practice knowledge gap, illustrating the use of macro quantitative empirical research methods, and developing a new unionization trend metric.


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