The risk of a double-dip recession is rising

hi, if you find this massage is interesting, share with your friends The risk of a double-dip recession is rising Posted by Philip Dru on 8/24/09 • Categorized as Economy T? he global economy is starting to bottom out from the worst recession and financial crisis since the Great Depression. In the fourth quarter of 2008 and first quarter of 2009 the rate at which most advanced economies were contracting was similar to the gross domestic product free-fall in the early stage of the Depression. Then, late last year, policymakers who had been behind the curve finally started to use most of the weapons in their arsenal. That effort worked and the free-fall of economic activity eased. There are three open questions now on the outlook. When will the global recession be over? What will be the shape of the economic recovery? Are there risks of a relapse? On the first question it looks like the global economy will bottom out in the second half of 2009. In many advanced economies (the US, UK, Spain, Italy and other eurozone members) and some emerging market economies (mostly in Europe) the recession will not be formally over before the end of the year, as green shoots are still mixed with weeds. In some other advanced economies (Australia, Germany, France and Japan) and most emerging markets (China, India, Brazil and other parts of Asia and Latin America) the recovery has already started. On the second issue the debate is between those – most of the economic consensus – who expect a V-shaped recovery with a rapid return to growth and those – like myself – who believe it will be U-shaped, anaemic and below trend for at least a couple of years, after a couple of quarters of rapid growth driven by the restocking of inventories and a recovery of production from near Depression levels. There are several arguments for a weak U-shaped recovery . Employment is still falling sharply in the US and elsewhere – in advanced economies, unemployment will be above 10 per cent by 2010. This is bad news for demand and bank losses, but also for workers’ skills, a key factor behind long-term labour productivity growth. Second, this is a crisis of solvency, not just liquidity, but true deleveraging has not begun yet because the losses of financial institutions have been socialised and put on government balance sheets. This limits the ability of banks to lend, households to spend and companies to invest. Third, in countries running current account deficits, consumers need to cut spending and save much more, yet debt-burdened consumers face a wealth shock from falling home prices and stock markets and shrinking incomes and employment. Fourth, the financial system – despite the policy support – is still severely damaged. Most of the shadow banking system has disappeared, and traditional banks are saddled with trillions of dollars in expected losses on loans and securities while still being seriously undercapitalised. Fifth, weak profitability – owing to high debts and default risks, low growth and persistent deflationary pressures on corporate margins – will constrain companies’ willingness to produce, hire workers and invest. Sixth, the releveraging of the public sector through its build-up of large fiscal deficits risks crowding out a recovery in private sector spending. The effects of the policy stimulus, moreover, will fizzle out by early next year, requiring greater private demand to support continued growth. Seventh, the reduction of global imbalances implies that the current account deficits of profligate economies, such as the US, will narrow the surpluses of countries that over-save (China and other emerging markets, Germany and Japan). But if domestic demand does not grow fast enough in surplus countries, this will lead to a weaker recovery in global growth. There are also now two reasons why there is a rising risk of a double-dip W-shaped recession. For a start, there are risks associated with exit strategies from the massive monetary and fiscal easing: policymakers are damned if they do and damned if they don’t. If they take large fiscal deficits seriously and raise taxes, cut spending and mop up excess liquidity soon, they would undermine recovery and tip the economy back into stag-deflation (recession and deflation). But if they maintain large budget deficits, bond market vigilantes will punish policymakers. Then, inflationary expectations will increase, long-term government bond yields would rise and borrowing rates will go up sharply, leading to stagflation. Another reason to fear a double-dip recession is that oil, energy and food prices are now rising faster than economic fundamentals warrant, and could be driven higher by excessive liquidity chasing assets and by speculative demand. Last year, oil at $145 a barrel was a tipping point for the global economy, as it created negative terms of trade and a disposable income shock for oil importing economies. The global economy could not withstand another contractionary shock if similar speculation drives oil rapidly towards $100 a barrel. In summary, the recovery is likely to be anaemic and below trend in advanced economies and there is a big risk of a double-dip recession.

Analyst Bove sees 150-200 more U.S. bank failures

hi, if you find this massage is interesting, share with your friends Analyst Bove sees 150-200 more U.S. bank failures Posted by Philip Dru on 8/24/09 • Categorized as Economy NEW YORK (Reuters) – A prominent banking analyst said on Sunday that 150 to 200 more U.S. banks will fail in the current banking crisis, and the industry’s payments to keep the Federal Deposit Insurance Corp afloat could eat up 25 percent of pretax income in 2010. Richard Bove of Rochdale Securities said this will likely force the FDIC, which insures deposits, to turn increasingly to non-U.S. banks and private equity funds to shore up the banking system. "The difficulty at the moment is finding enough healthy banks to buy the failing banks," Bove wrote. The FDIC is expected on August 26 to vote on relaxed guidelines for private equity firms to invest in failed banks, after critics said previously proposed rules were too harsh and would actually dissuade firms from making investments. Bove said "perhaps another 150 to 200 banks will fail," on top of 81 so far in 2009, adding stress to the FDIC’s deposit insurance fund. Three large failures this year — BankUnited Financial Corp in May, and Colonial BancGroup Inc, Guaranty Financial Group Inc in August — collectively cost the fund roughly $10.7 billion. The fund had $13 billion at the end of March. Regulators closed Guaranty’s banking unit on Friday and sold assets of the Texas-based lender to Banco Bilbao Vizcaya Argentaria SA. The FDIC agreed to share in losses with the Spanish bank. Bove said the FDIC will likely levy special assessments against banks in the fourth quarter of this year and second quarter of 2010. He said these assessments could total $11 billion in 2010, on top of the same amount of regular assessments. "FDIC premiums could be 25 percent of the industry’s pretax income," he wrote. (Reporting by Jonathan Stempel; editing by Gunna Dickson)

Do You Make These 7 Body Language Mistakes?3

hi, if you find this massage is interesting, share with your friends * of them plus the ones above to find which one(s) fit you the best. 7. Holding yourself back. So, let’s say you know most of the things above already. It isn’t exactly rocket science. So why are you still not using those tips - or tips from somewhere else - to change and experiment with how you communicate? One big reason may be that you are holding yourself back. You may hold yourself back from becoming more expressive over all or, for instance, with your hands. Or you may hold yourself back completely from taking up more space or making more eye-contact. Holding yourself back may be because of a few different reasons. The most common one is probably the one already described in the previous mistake: a fear of what others may think, say or do. Yes, people may react negatively. And yes, you might exaggerate your body language a bit too much at first by for instance sitting with your legs almost ridiculously far apart. However, people aren’t looking at you as much as you may think. They are like you. They have their own stuff to think and worry about. If you experiment with your body language, then sure, you might seem a little strange sometimes. But most of the time people will probably not even notice that you have changed something. They aren’t standing around watching your every move all day long. Also, keep in mind that if you for example are normally not that expressive then what might feel weird to you isn’t necessarily that weird to others. It’s just you comparing the old way to the new way in your own head. It’s just you getting used to being more expressive. If you change your body language for the better, most people will only react in a more positive way towards you. Because as mentioned in mistake #1, how you live your life and how you feel comes through in your body language. And if you feel great then that comes through. And emotions are contagious. So now, people you interact with feel better too. And just about everyone wants to feel positive emotions. So, yeah, you may look like fool a few times if want to change. But that’s OK. It’s a lot better than going around all of your life and holding yourself back. And if you don’t take yourself and life too seriously – mistake #3 – then your fear of looking like a fool and being rejected in some way will decrease.

Do You Make These 7 Body Language Mistakes2

hi, if you find this massage is interesting, share with your friends 3. Taking yourself or life too seriously. Generally, taking yourself or things too seriously isn’t a great idea for several reasons. It can cause you to get offended and angry or resentful for the smallest negative thing someone says or does. It can make it hard for you to let things go and instead you let them fester. It can make tasks a whole lot harder to get done as you might see everyday life as a bitter struggle. It can help you reinforce and strengthen victim thinking. This isn’t good for your interactions. And it isn’t good for your body language as your negative feelings will come through to others. It’s also not a helpful attitude to have if you want to change your body language as it can make you take this challenge all too seriously. That can cause you to get upset with yourself when you make a mistake. And make you think so much about the challenge that your thoughts get stuck in self-conscious loops. A few tips for adopting a lighter attitude towards yourself and life are to not identify so much with your thoughts and emotions, to realize that you are not you ego and to develop an abundance mentality. You can read more about those three suggestions in Lighten Up!. 4. Moving too fast and fidgety. If you move too fast you can feel stressed. The stress can then reinforce how fast you move. Or make you more fidgety. Moving fast and fidgeting around can make people around you feel stressed, nervous, distracted and uncomfortable. Shaking your leg while seated or tapping your fingers against the table rapidly are two fidgety habits. Touching your face a lot is another one. Instead of fidgeting with your hands and scratching your face you can use them to communicate what you are trying to say. Use your hands to describe something or to add weight to a point you are trying to make. But don’t use them to much or it might become distracting. And don’t let your hands flail around, use them with some control. If you have a tick or feel fidgety then learning to relax more can help you out. You can, for instance, become more relaxed by just moving slower. This will also make you seem more calm and confident. Or you can weed out your habit of touching your face simply by keeping it in mind and avoiding it. There might also be larger issues in your life that you need to resolve to decrease or remove your bad habit. You can find 36 tips for decreasing stress in your life in this article. 5. Not keeping your posture in mind. From time to time that is. You shouldn’t make mistake #2 and getting obsessed with it. Sitting or standing up straight in a relaxed manner with your head up has a few benefits: * It creates positive emotions such as alertness and feeling focused. * It can help you with first impressions as it makes you seem more interesting/attractive. * It can sometimes help you avoid pain in your back, shoulders etc. 6. Closing up. Being open and conveying that you are open is one of the most important parts of communication. If you start to close up or walk into an interaction closed up then it will be hard to establish a genuine connection. If you feel a bit wary and closed up inside then it will not only stop you from being open. It will also keep you from relaxing, smiling and laughing and having fun. A few common ways to close up is to: * Cross your arms and/or legs. You have probably already heard you shouldn’t cross your arms as it might make you seem defensive or guarded. This goes for your legs too. Keep your arms and legs open. Taking up space by for example sitting or standing with your legs apart a bit signals self-confidence and that you are comfortable in your own skin. * Not keeping eye contact. If there are several people you are talking to, give them all some eye contact to create a better connection and see if they are listening. Keeping too much eye-contact might creep people out. Giving no eye-contact might make you seem insecure. If you are not used to keeping eye-contact it might feel a little hard or scary in the beginning but keep working on it and you’ll get used to it. * Hold your drink at your chest. Don’t hold your drink in front of your chest. In fact, don’t hold anything in front of your heart as it will make you seem guarded and distant. Lower it and hold it beside your leg instead. Closing up often comes from feeling nervous or insecure. You may in some way perceive the people you are meeting as a threat. Perhaps you’re afraid that they will mock you, not like you or that you will make a fool of yourself in some way. A few tips to a shake these thoughts and feelings out of yourself is to: * Belly breathe. This is one of my favourite tips to make myself feel more relaxed and calm in just a minute or two. Read about it here. * Assume rapport. Just before a meeting, you just think that you’ll be meeting a good friend. Then you’ll naturally slip into a more comfortable, confident and enjoyable emotional state and frame of mind. This also helps you and the other people to set a good frame for the interaction. A frame is always set at the start of an interaction. It might be a nervous and stiff frame, a formal and let’s-get-to-the-point kind of frame or perhaps a super relaxed one. The thing is that the frame that is set in the beginning of the conversation is often one that may stay on for a while. First impressions last. With some practise - to remove inner resistance towards this idea and get you to feel more like you know what you’re doing – you may become pretty surprised at how effective assuming rapport is. I was. * Experiment. Have a look at a few more ways to handle nervousness. And a few tips for putting a stop to anxiety. Try a few of them plus the ones above to find which one(s) fit you the best.