March 18th, 2011 - no responses
Obama left to Brazil, he’ll arrive in Brasilia tomorrow morning.
Initially Obama would speech for tens of thousands of Brazilians, like he did in Germany in 2008, but the plans changed, he’ll now speech in the Teatro Municipal for 2200 persons. Obama will surely have a hectic week leaving the US for 5 full days, with the crisis in Libia and Japan on his head, he’s already being criticized back home.
But after this article Obama wrote himself in the USA Today, the press went somewhat milder on him like here on CNN.
CNN also has a feature on the favellas Obama will visit (actually, Cidade de Deus, yes, the one of the movie).
It’s clear that Obama’s visit is not altruistic, the man wants to export to Brazil and latin America, quoting his words:
Nearly 600 million people live in Latin America. The region’s economy grew by about 6% last year. Between 2010 and 2015, it’s expected to grow by one-third. And as these markets are growing, so is their demand for goods and services — goods and services that, as president, I want to see made in the United States of America.
In 1990, Brazil was the 16th largest market for our goods. Last year, it was the eighth largest. In 2010, our exportsto Brazil grew by more than 30% to just over $50 billion, supporting more than 250,000 jobs here at home.
Again Europe is loosing out bigtime !
And also the Brazilians know why Obama is coming to Brazil: petrol and exports. This poll clearly shows Brazil is not stupid and will dance Samba with Obama:
More on his visit the coming days.
Meanwhile this excellent article in The New York Times is wortwhile reading.
Tags: obama, obama and dilma, obama brasi, obama brazil
September 12th, 2010 - no responses
Belgium economist Geert Noels highlights in his recent article that Belgium is now riskier than Brazil when one considers trhe spreads on bonds and CDS-premiums.
As below chart highlights, the Brazilian CDS premiums remained stable at 150 while the Belgian premiums almost trippled from 48 to 153 in the last year.
Noels concludes “We -Belgians- are now seen as more risky than Brazil. And that is not so irrational if you compare both countries.”
Mr. Noels pointed publicized this report last week on the devastating effects of the industrial sector which is completely melting away in Belgium; leaving the country in a crippled position with ever increasing trade deficits.
Tags: CDS premium, geert noels
August 3rd, 2010 - no responses
We have written before on the important impact of demographics on real estate and economy on a whole.
When talking to real estate developers in Belgium, it surprises me each time that they fail to acknowledge that price appreciation of Belgian real estate from 1980 until the financial crisis occured parallel with the entry of boomers into the labour force. In countries like Belgium an massive amount of women entered the work market and all people obtained higher educational levels than their parents. The quantity and quality of labour increased, total consumption rose and so did aggregated savings. These savings took in countries like Belgium the form of real estate investments and prices rose.
Those times are over in Belgium.
The trend of an increasing amount of woman entering the labor market stopped (saturation reached), educational levels are no longer going up (top has been reached), productivity is decreasing in Belgium and so are the aggregated savings. This has nothing to do with the crisis, it is a long term Trend that started in 2004 and it’s fundaments are the demographics and the massive immigration of people with extremely low added-value to the Belgian economy.
Which brings is to what is called demographic dividend; the major drivers of real estate growth.
Demographic dividend happens when (1) falling fertility lowers child dependency and (2) when the working age population (15-64) expends but (3) before the old age dependency starts to rise significantly.
Belgian lost it’s demographic dividend completely; on the contrary, the country is going into an area of demographic deficit; not only because of the above 3 drivers, but also because of the destructive immigration policies of Belgium.
Demographic dividend goes hand in hand with rising investment and accelerating growth; the Western world enjoyed demographic dividend for the last 30 years; but now the party is over, the benefit is exhausted; no new workers are entering the job market and a massive amount of long-living baby-boomers are retiring, aggregated savings are falling. In the Western world the new morale is “walk away from your mortgage, buy an iPad”
People who believe that in Western Europe the real estate prices will recover after the financial crisis are wrong; they forget the impact of the above described much stronger negative driver. The number of 20-44 year olds, who are the ones buying real estate and first-time homes will fall by 20% in the next two decades, even up to 30% in Belgium and Spain and … China (yes, China: the 1-child policy will have a very ugly impact on China soon), and even decrease a massive 40% in South Korea.
Brazil has a very healthy fat belly of new entrants in the labour market for the coming 20 years, their time to enjoy the stimulans of demograhic dividend.
George Magnus wrote an insightful book on the theme in 2008, called “The Age of Aging“, next October his new book “Uprising: will the emerging markets Shape or Shake the world economy” will be published.
July 15th, 2010 - no responses
We reported last May on the attempts of Europe to revitalize the talks on a trade zone between Europe and the Mercosur. Not much has happened since, except for the fact that the trade balance of Europe continues to deteriorate. Last year in April their was just a tiny trade surplus of 0,1 billion in Belgium, this year (despit the Euro which decreased substantially in value and should support exports), the trade deficit amounts 1 billion Euro in April. That is massive.
Today some news on the attempt of the trade talks between Europe and Mercosur appeared again. Yet, agriculture remains a problem. Read: Europe wants to export, but prevent Brazilian imports coming in. That bird won’t fly. A lot of news on these trade talks in Europe, but not a word in the Brazilian press; Europe is far less a priority for Brazil than Mercosur is for Europe, what counts for Brazil is China and emerging markets like (South) Africa, that’s where the growth is.
Tags: europe mercorsu
July 14th, 2010 - no responses
