Gross Financial Investment vs. Net Financial Investment
Gross Financial Investment vs. Net Financial Investment When economists discuss investment in real capital expenditures they make a distinction between gross and net. If investment expenditures just match the depreciation of capital equipment, then gross investment rises, but net investment is unchanged. Increases in net investment, not gross investment, are what matters with regard to the future productivity of the economy. Financial institutions have been experiencing a good bit of
AUD overlay
AUD Average YTD: .8452 Australian Exporter Most Recent Action Unhedged/Short at .8701 Reversed at .8639 New Position Hedged/Long New Reversal Point .8501 Rate Achieved YTD: .7823 Australian Importer Most Recent Action Hedged/Short at .8751 Reversal Point .8679 Rate Achieved YTD: .8487
Asian Stocks Mixed After Lackluster U.S. Holiday Sales
- Total U.S. retail sales, excluding automobile sales, rose 3.6% for the holiday season spanning the day after Thanksgiving to midnight Monday, at the low end of the forecasted 3.5% to 4.5% range. Excluding gas prices, U.S. holiday sales only increased 2.4%. “The surge at the beginning of the season and the surge at the end of the season definitely resulted in the modest growth that we saw,” said Michael McNamara, vice president of MasterCard Advisors. “If we didn’t have those surges, it would
Index of Leading Indicators Sends a Compelling Message of Weak Economic Conditions
Index of Leading Indicators Sends a Compelling Message of Weak Economic Conditions The Index of Leading Economic Indicators (LEI) fell 0.4% in November following a 0.5% drop in October. The 1.2% drop in the LEI during the May to November period is the largest six month decline in six years. On a year-to-year basis, the October-November average translates into a 0.8% year-to-year drop, which is the largest drop on record since the third quarter of 2001 when the U.S. was in a recession. On a
Hungary: Cautious MNB keeps rates unchanged
At its monetary council meeting today, the Hungarian central bank (MNB) decided to keep its leading inter-est rate unchanged at 7.50% in line with the consensus expectation and our expectations. Hence, the market reaction to the rate decision should be limited. Over the last couple of months, inflation has picked up in Hungary despite a massive slowdown in domestic demand and that is clearly an argument for the MNB to ease monetary policy during 2008. However, re-cently, Hungarian inflation
Asian Stocks Recover From Early Selling
- The AUD traded higher after the Reserve Bank of Australia released the minutes for the December meeting, saying that higher interest rates may still be needed to address inflation concerns. The RBA expects inflation to exceed its 2.0%-3.0% target range in the first half of 2008, before declining to 3.0%. “But given that a rise in money market rates had occurred, members observed that a further rise in the cash rate at this meeting, by adding to these market pressures, would result in quite a
Merrill May Get $5B Cash Infusion
- The Wall Street Journal reported that Merrill Lynch is expected to get a $5 billion cash infusion from Singapore’s state-owned investment company, Temasek. Temasek’s board has given preliminary approval to the investment in Merrill, although pricing, timing and regulatory issues remain to be negotiated, the Wall Street Journal said. - New Zealand GDP growth slows down: (NZ Q3 GDP QOQ: 0.5% V 0.4% expected, RBNZ expected 0.6%, prior revised to 0.8% from 0.7%; YOY: 3.3% V 3.2% expected,
China at the crossroads
Growth locomotive. There appears to be no end in sight to China?s growth boom. Real GDP grew by 11 % this year, the strongest increase since 1994 ? despite restrictive measures implemented by the government and the central bank (pages 3-5). Need to act. The drastic surge in inflation is, however, increasingly forcing economic policymakers to adopt counter-measures. A stronger revaluation of the CNY against the USD is unavoidable. Furthermore, the central bank has already announced a tighter
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