The Strange Case of the Missing Crises
By Greg Ip
April 8, 2016
Capital has been flowing out of emerging markets for several years, driven by slowing growth, tumbling commodity prices, and the prospect of higher U.S. interest rates. Oddly enough, no big emerging country has gone bust as a result. The absence of a crisis is not normally worth noting. But it is in this case, because read more...
IMF: Capital Inflows Drop for 5th Straight Year
April 4, 2016
The 2016 IMF World Economic Outlook said the world's emerging markets have seen a decline in overseas investment that's hurt their development in recent years but they now can better contain risk.
The IMF said in its report that the net capital inflows of the emerging markets have now dropped for five straight years. The situation was worst in 2015. Senior IMF economist Luis Catao explained the decline. read more...
O Alimento e a Guerra Cambial
Por Luis A.V. Catão
July 6, 2011
Nos acostumamos por gerações com a comida mais barata. Desde o boom de commodities de 1973/74 (que ainda que frequentemente esquecido incluiu tanto o petróleo como os alimentos) até anos recentes, o preço mundial de commodities alimentícias em dólares apresentou uma forte tendência declinante - tanto se deflacionado pelo preço unitário global de manufaturas, como pelo Índice de Preços ao Consumidor (CPI) dos EUA (que inclui o custo de bens de serviço), como mostra o gráfico abaixo. Deflacionado por este último, o preço relativo da alimentação caiu cerca de 80%. read more...
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Will Rising Food Prices Kill the Recovery?
By Stephen Gandel
January 20, 2011
If food costs more, will you buy any less? Surprisingly enough, that simple question may be the key to whether 2011 sees a strong rebound in economic growth, or is, instead, a bust.
The issue is that raw food prices are indeed way up. Corn is at a two and a half year high. And some think it could rise by another 30% this year. Sugar was up 77% in the last six months of 2010. Beef prices are up as well. On the face of it, climbing food prices seem read more...
Brazilian Banks Return Profits with Interest
By Jonathan Wheatley in São Paulo
June 28, 2010
Regina Araújo, one of Brazil’s army of domestic servants, has just bought a cordless telephone and answering machine from Casas Bahia, a big high street retailer.
She takes the sales slip from her handbag to show the price: R$169.90 ($95). Or, that’s what she would have paid up front. Instead, she chose to pay 10 monthly instalments of R$40.15 each. read more...
A Retomada do Crédito
By Luís Catão - O Estado de S.Paulo
April 20, 2010
Um importante indicador do quanto a economia brasileira já se recuperou da crise global é a taxa de crescimento do crédito bancário, mesmo se deduzida da inflação, que alcançou a casa dos dois dígitos no 1.º trimestre. O crédito ao consumo já cresce a um ritmo mais de duas vezes superior ao do PIB. Ainda que modesta, se comparada ao período pré-crise (crescimento cinco vezes superior), a tendência à aceleração é clara. read more...
World of Investing : Take
Advantage of Global Boom
By James K. Glassman
Published: June 26, 2004
For American investors, one of the thorniest questions is how many foreign stocks to own. All investors are unilateralists at heart, biased toward the homeland, and most economists think that's a mistake.
A study by Robin Brooks and Luis Catao for the International Monetary Fund looked at the performance of 5,500 stocks in 40 markets over the period 1986-2000. The researchers found that the correlation between returns in American... read more ...
James K. Glassman's World of Investing : In Ever-Smaller World, Global Diversification Is Proving Less of a Hedge
By James K. Glassman Published: April 9, 2001
FOR DECADES, a key rule of investing was to diversify internationally. The reason was simple. When stocks in some parts of the world perform poorly, stocks in other parts of the world perform well. In other words, international markets are not closely correlated. As a result, owning a strong dose of U.S. stocks has provided balance for a non-U.S. portfolio, and vice versa.
More important, a recent study by Robin Brooks and Luis Catao for the International Monetary Fund looked at the performance of 5,500 stocks in 40 markets from 1986 to 2000. The economists found that the correlation... read more ...
Dancing in Step
Individual stockmarkets are increasingly being driven by global rather than local factors
Mar 22nd 2001 | from the print edition
AMERICA'S stockmarket has slumped as its economy has slowed abruptly, and Wall Street appears to be dragging the rest of the world's markets down with it. But why do other markets not have a mind of their own? They did have once.
Traditionally, one way that investors sought to reduce risk was by diversifying overseas: when American shares slumped, the loss there would be offset by a gain in, say, European shares. That, at any rate, was the theory. In recent years, however, read more ...