apatheticman posted:

Economics is astrology with more steps.

Bar Ran Dun posted:

losing a deposit is a very different thing than losing a loan guarantee.

I mean it’s lovely and sucks but it’s still quite different.

Mr Hootington posted:

The article isn't just about the depositors.

FizFashizzle posted:

have you considered working 7p-7a at the hospital like a real sicko

silicone thrills posted:

Still remains my favorite dumb boeing in the news thing - that time a train derailed carrying a bunch of the fuselages.

https://www.usatoday.com/story/todayinthesky/2014/07/05/train-derailment-spills-boeing-737-fueslages-into-river/12258639/

Poland and Hungary have temporarily halted imports of Ukrainian grain despite a warning from Brussels that such unilateral action would contravene EU trade policy.

After Moscow launched its full-scale invasion of Ukraine last year, the EU scrapped customs duties and quotas on Ukrainian grain imports and rerouted some shipments from blockaded Black Sea ports via Polish and Romanian roads and railway networks.

The announcement by Poland and Hungary is an attempt to placate their farmers amid a grain glut that has sent prices crashing in their domestic markets as cheap Ukrainian grain undercuts local producers.

Most of the grain was meant to be re-exported from the EU to the Middle East and Africa to help Ukraine’s economy and at the same time alleviate food shortages sparked by the war.

But the grain remained in countries close to Ukraine because of a shortage of trucks and trains to move it to neighbouring ports. A bumper grain harvest in central Europe meanwhile helped to avert a food crisis.

Struggling with high debt and weakening economies, poorer nations in Africa and elsewhere have also recently been seeking to curtail food imports.

Eastern European farmers have complained about the level of compensation offered by Brussels.

The European Commission on Sunday said it was aware of the move by Warsaw and Budapest regarding the import of Ukrainian grain and other agricultural products. Miriam Garcia Ferrer, commission spokesperson for trade and agriculture, said: “Trade policy is of EU exclusive competence and, therefore, unilateral actions are not acceptable. In such challenging times, it is crucial to co-ordinate and align all decisions within the EU.”

quote:

I'm the type of people who like to pay close attention to grocery bills. During the whole pandemic our grocery bill didn't increase that much. But starting from ~ 6 months ago it really started to go up a lot, and now it is steady at about 60% more expensive than during the pandemic. I feel like 60% is ....a lot!! Is is not?

We are a household of 2. We do 90% of the grocery shopping at trader joes, so that's the bill I'm comparing. We started doing grocery together during the pandemic. Our weekly bill was always around $70. Sometimes if we buy more snacks and frozen food or have to get staples like olive oil, the bill can go up to $90. And $90 is very rare.

In the past few months our bill stayed around $110. If we get more snacks and frozen food, the higher end would be $150. There were a few times I thought we really didn't buy that much, but still spent over $110. And I went over the bill item by item to make sure there were no mistake. Even my husband who never pays attention to how much we spent on grocery said that it was expensive.

We always buy the same thing every week. It simplifies our cooking routine and saves time. We don't eat anything super expensive like fancy steaks or super organic food. We cook most of our meals and only eat out once or twice a week. We thought we'd want to go out to eat more now that the pandemic is over, but everything is much more expensive now, and more tips are expected. We felt like it's not sustainable for us any more. I wonder how do people keep going out to eat so much?

Nonsense posted:

turbotax defaults to 70 buck version and all the online guides to help find the free version of turbotax on their own site are clogged with google ai poo poo

quote:

Intuit once participated in the IRS Free File program, a public-private partnership between the IRS and tax software companies to provide free tax filing services to millions of lower-income Americans. But it left the program in 2021 after ProPublica detailed the many ways TurboTax tricked Americans into paying to file their return.

...the IMF’s managing director Kristalina Georgieva noted that about 15 per cent of low-income countries were already in “debt distress” and almost half were in danger of falling into it.
...
While domestic laws and judges govern the bankruptcies of companies and individuals, there is no international law for insolvent countries — only a chaotic, ad hoc process that involves working through a hodgepodge of contractual clauses and tacit conventions, enduring tortuous negotiations and navigating geopolitical expediency.

A decade ago, US-based hedge fund Elliott Management exploited that landscape to notch up several lucrative victories by suing defaulters for full repayment of their debts. But this fragile patchwork is now under threat of unravelling completely due to the emergence of a new, disruptive, opaque and powerful force in sovereign debt: China.

Some experts say Beijing’s lending spree to developing countries and refusal to play by western-established rules represents the single greatest impediment to government debt workouts and threatens to leave some countries in debt limbo for years.

“The multilateral financial institutions are run largely by Americans and Europeans. China had hoped to be able to shape the agenda of debt relief, not to have it dictated by the west,” she says.

Jay Newman, the former Elliott fund manager who successfully sued Argentina for $2.4bn after its 2001 debt restructuring, says the emergence of China as a significant player has left the entire system in uncharted waters. “You now have one big state creditor with the power to dictate terms and the patience not to make a deal if it doesn’t suit them. It has completely changed the game.”

In a grim sign of the times, Alvarez & Marsal — one of the world’s biggest corporate bankruptcy advisers — this year set up a sovereign practice for the first time. Underscoring its expectations for the business, it hired Reza Baqir, a former senior IMF official and governor of Pakistan’s central bank, to lead the new unit.
...
Baqir is among those that say the debt restructuring process is broken, largely because it was primarily designed for a bygone era, when creditors were overwhelmingly western countries and western banks.



Decades ago, the Paris Club was formed to co-ordinate between government creditors, while bankers formed the London Club to restructure their debts. Broadly speaking, western governments drove the process, and occasionally leaned on banks to accept painful settlements.

But the decline of bank lending and the growth of the bond market shook things up in the spate of sovereign defaults that started in the early 1990s. Creditor co-ordination became trickier with myriad bondholders trading claims around the world, rather than just a handful of banks.

Argentina’s default on $80bn of bonds in 2001 led to years of fights between Buenos Aires and investors such as Elliott, which refused to accept the terms agreed by other creditors. At one point the hedge fund famously seized an Argentine naval vessel when it docked in Ghana. Its reputation became such that bondholders would sometimes invoke the mere spectre of Elliott to scare countries contemplating a default, while policymakers used it as prima facie evidence of the sovereign debt restructuring system’s weaknesses.

In the wake of the Argentine debacle the IMF responded by attempting to set up a kind of bankruptcy court for countries with itself as judge. But the sovereign debt restructuring mechanism foundered after attracting little support from the IMF’s biggest shareholders. Instead, the US championed the insertion of “collective action clauses” into bonds, which compel recalcitrant creditors to accept a restructuring agreement made by a majority. After Greece’s debt restructuring in 2012 these CACs were beefed up further.

However, many bonds still lack these clauses. Moreover, they can only help ease a restructuring agreement once it is struck. Many experts point out that they do nothing to solve the biggest fundamental problem: countries are far too slow to seek a debt restructuring as they are wary of a messy process with the potential of worsening an economic crisis and the inevitable political humiliation of defaulting.
...
When they are finally forced into a debt restructuring, the financial relief that countries secure is often too little to ensure a durable upswing. In the few cases where it does clean up their balance sheet, it sometimes only leads to another debt binge.

This flawed process has now been further complicated — some say wrecked — by China’s vast lending programme across the developing world over the past decade. Many of these loans are opaque in size, terms, nature and sometimes even existence.

The overall size of the lending programmes is hard to judge, given that China does not report most of it to the likes of the IMF, OECD or Bank for International Settlements. But AidData, a development think-tank based at William & Mary’s Global Research Institute [USAID partner lol] , estimates that the loans amount to about $843bn. China is not a member of the Paris Club, and in most cases the loans are made by its myriad state-owned or merely state-controlled banks, muddling things further.
...
“We spent 20 years focusing on contractual tweaks, assuming that bonds were the problem,” she [Anna Gelpern] says. “The problem is the state of global politics, and the fate of low-income countries just isn’t a big priority anywhere.”

Life in default

Zambia is a prime example.
...
The IMF has reached a support agreement with Zambia that is conditional on its debt burden becoming sustainable. But other bondholders do not want any relief they offer to simply go towards paying off China. Beijing has in principle agreed to accept a “haircut” on its debts, but experts say it appears to not want anything it offers to go towards improving the recovery of private creditors, leading to the impasse.

In the meantime, Zambia says it has accumulated about $1.2bn in arrears since its default. Including missed payments to various government contractors, the IMF has estimated that the arrears are actually nearly $3bn.

Highlighting how China also appears to be leveraging these situations to undermine the western-designed global financial architecture, in January it called for international organisations such as the IMF and World Bank to participate in the debt restructuring. This would overturn half a century of convention that these organisations are “super-senior” creditors exempt from debt restructurings, as participating would imperil their ability to lend to other countries.

One senior adviser to the Chinese government says that “there is no law that requires World Bank loans to be prioritised” and that the country was “not happy” with a practice that originated in an era when western countries were generally the only creditors. “If we allow the World Bank to take precedence over us, we need to have bigger voting rights and take larger stakes at the bank. China’s duty doesn’t match its rights in development finance.”
...
China’s exceptionalism?

For the most part, experts say China seems mostly content with rolling its debts rather than restructuring them, handing out new loans to ensure that its domestic banks can be repaid in full.
...
Reinhart says that China’s lending stands out for its “extreme” opacity but stresses that its overall behaviour is not as unusual as some people say. “China is really playing hardball because it is a major creditor. US commercial banks also played hardball back in the 1980s,” she says. Baqir agrees, saying: “Whatever the colour or creed of a creditor, creditors think like creditors.”
...
“We need co-ordination from the top level, which now has other priorities,” the [Chinese government] adviser says. He also points out that the pressure on developing countries has intensified following a series of US interest rate rises, and that as a result Washington “should be responsible for the debt trap”.
...
Ironically, both Buchheit and Newman — who clashed many times over the years as the leading lawyer for and suer of bankrupt countries — advocate for the same basic approach: countries should restructure the debts they can, remain in default to China, and the IMF should drop its “kumbaya” approach and accept semi-permanent arrears to its biggest shareholders.

Mr Hootington posted:

The argument would be the government rushed to save the rich depositors money, but is not rushing to save lost jobs and lost housing.

When Ghana defaulted on its debts and reached a preliminary agreement on a $3bn IMF bailout last December, the world’s lender of last resort imposed many familiar conditions to get the country’s finances back on track [including measures to raise revenues through a rise in the rate of value added tax, tariff increases on public utilities and an end to central bank finance for the government].

One demand, however, was strikingly new, and analysts say it will change the debt landscape forever. The IMF said that before it asks its board to approve the support package, Accra must first address its domestic debts — money typically borrowed from local banks, pension funds and insurance companies.

“This has opened a can of worms, in Ghana and elsewhere,” said Thys Louw, emerging market debt portfolio manager at investment company Ninety One. “Every restructuring is going to have this issue hanging over it.”

The dilemma for governments is that as they fall into default they face a stark choice. If they force overseas creditors to shoulder all the pain, they risk losing access to foreign capital while struggling to restore their overall debt to a sustainable footing. Yet pushing losses on to domestic creditors risks wiping out local banks, pension funds and insurance companies.

The cost to taxpayers of recapitalising a banking sector can be more than the savings achieved through debt restructuring.

In Ghana, said Joe Delvaux, emerging markets distressed debt portfolio manager at Amundi, “if you just restructure the external debt, that’s not enough to get you back on a path to debt sustainability”.

Back in the late 20th century... Many countries had borrowed heavily by issuing bonds denominated in US dollars. These appealed to foreign investors because they shielded them from currency risk and other instabilities. For borrowers, they were cheaper than bonds issued at home, where lenders demanded compensation for risks such as high inflation.

But borrowing in US dollars left countries exposed to shocks beyond their control, as the 1980s and ’90s brutally illustrated in Latin America, Asia and elsewhere. In 1999, economists Barry Eichengreen and Ricardo Hausmann described reliance on foreign-currency financing as “original sin”.

Since then, urged on by the likes of the IMF and the World Bank, many emerging economies have developed deep domestic capital markets that allow them to borrow primarily at home. Brazil, India and South Africa have almost no foreign-currency public debts at all.



During years of low global interest rates, the local currency debts of developing countries accumulated almost under the radar.

“The more a country develops its financial markets, the more debt tends to be accumulated in its local market,” says Delvaux. “But the moment you are in debt distress, because local debt is a bigger component than it used to be, it becomes an integral part of what has to be considered in debt restructuring.”

[aside: see below tweet from Philipp Heimberger]
https://twitter.com/heimbergecon/status/1647105794045878274
...
But the cost of servicing domestic debt was equal to 21.5 per cent of GDP last year, according to the IMF, compared with 9.4 per cent of GDP for external debt.

Other examples are more extreme. Pakistan, which is teetering on the brink of default, has public debts equal to 75 per cent of GDP, according to the IMF, of which two-thirds is domestic. But its interest payments on domestic debts are six times those on external debts.

In Egypt, public debt is 88 per cent of GDP, according to the IMF, of which three-quarters is domestic. Interest on domestic debt costs 10 times the interest on external debt.
...
“The issue was, are we acknowledging that we are in a crisis and how are we going to share the burden to get us out of it,” [finance minister Ken Ofori-Atta] said. With debt service eating up 70 per cent of government revenues before the default, he added, spending on health, education and infrastructure “had come to a jagged halt”.

Bar Ran Dun posted:

I mean it’s lovely and sucks but it’s still quite different.

FizFashizzle posted:

have you considered working 7p-7a at the hospital like a real sicko

BornAPoorBlkChild posted:

https://twitter.com/Xxsethmonsterxx/status/1647403546281689093?t=8euVhcVpys1sTU7mjAtTBg&s=19

webcams for christ posted:

Organizing for better working conditions is as important as ever.

Some weekend reading excerpts:



[url=https://www.ft.com/content/7bbd9ba2-81e4-463c-a6e2-67362a4d10a8]

webcams for christ posted:

excerpts

[url=https://www.ft.com/content/19add278-aa83-45f8-a84f-12750f32258f]

webcams for christ posted:

excerpts
[url=https://www.ft.com/content/7e008f0d-1ae9-4b8a-8caf-4e014fdf2f41]

webcams for christ posted:

and of course from the IMF themselves:

On average, fiscal consolidations do not reduce debt-to-GDP ratios. lmao
(credit to Adam Tooze for pulling the graph)

BornAPoorBlkChild posted:

https://twitter.com/incxgnegrx/status/1647640854583037954?t=C0l4kJRnqlvmdYStB1N60w&s=19

https://twitter.com/Xxsethmonsterxx/status/1647403546281689093?t=8euVhcVpys1sTU7mjAtTBg&s=19

Glumwheels posted:

Stolen from Reddit, this is in Seattle. Just major cash grabs by grocery chains and food mfgers/suppliers.

Mr Hootington posted:

Not being tech doesn't mean you didn't bank there

Ebola Roulette posted:

I've noticed something similar. My groceries used to average $120 a week but in the last month I can't get my total under $150 no matter what (store brand vs name brand, cutting out snacks, etc) and it's been as high as $180

webcams for christ posted:

and of course from the IMF themselves:

On average, fiscal consolidations do not reduce debt-to-GDP ratios. lmao
(credit to Adam Tooze for pulling the graph)

That Works posted:

Used to be I could get 1 weeks worth of groceries for my partner and I at just under $95 on average. In a rare week we would break $100 and only go over that other times when I was restocking a few big items at once (detergents, spices etc).

I haven't seen a shopping bill under $135 since the end of last summer. We also dropped most of the meat from our diet shifting over to beans and eggs (we raise chickens). Meat used to be one of the bigger expenses on the list and even without any of that most weeks it's at least 20% more expensive now vs less than 1 year ago. Fortunately we are in a good spot financially (for now) but this is hosed up for people on the margins.

Gunshow Poophole posted:

basically my household to a T.

also hoo boy: Cat Food lmao the wet food my cats eat was $47.52 a rack in November 2021 and it is now 64.92

silicone thrills posted:

Still remains my favorite dumb boeing in the news thing - that time a train derailed carrying a bunch of the fuselages.

https://www.usatoday.com/story/todayinthesky/2014/07/05/train-derailment-spills-boeing-737-fueslages-into-river/12258639/

quote:

Based on your household income and the number of people in your household, YOU are in the UPPER income tier, along with 18% of adults in PHOENIX-MESA-SCOTTSDALE.

Gunshow Poophole posted:

basically my household to a T.

also hoo boy: Cat Food lmao the wet food my cats eat was $47.52 a rack in November 2021 and it is now 64.92

Pittsburgh Fentanyl Cloud posted:

Just in time to avoid uncomfortable observations on declining material conditions, our friends at the Pew Research Center have redefined Middle Class to just mean “earns from 2/3rds to 2x median income” instead of basing it on any sort of lifestyle or security measurement.

https://www.pewresearch.org/fact-tank/2020/07/23/are-you-in-the-american-middle-class/

Gunshow Poophole posted:

basically my household to a T.

also hoo boy: Cat Food lmao the wet food my cats eat was $47.52 a rack in November 2021 and it is now 64.92

deadwing posted:

mine went from 30 bucks a case two months ago to 45 bucks a case last month lol