That’s what made the subprime debacle so dangerous. Millions of homes were underwater, so when borrowers didn’t pay, lenders didn’t have sufficient collateral to cover their loan exposure.
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Africa : Commodity Bridgehead to Asia
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That’s what made the subprime debacle so dangerous. Millions of homes were underwater, so when borrowers didn’t pay, lenders didn’t have sufficient collateral to cover their loan exposure.
"Many student loans are in default. According to the Fed’s most recent Household Debt and Credit Report, the student loan default rate is 11.2%, almost the same as the peak mortgage default rate in 2010. This is particularly interesting because student loans essentially have no collateral. Lenders make loans to students… but it’s not like the students have to pony up their iPhones as security" #Investorseurope stockbrokers
Twice as many sub-Saharan Africans have mobile phone access than access to paved roads. Mobile connectivity is to Africa what infrastructure is to the West.
"Without credit, how do you show a provider it is worth building a phone line and connecting you to its service? How can you guarantee its investment in you and in your phone line is going to pay off?"
Not just theory anymore: With Gates Foundation funding, malarial mosquitoes are being bred in Africa to destroy their own species.
"In Burkina Faso, Mali, and Uganda, the groundwork is being laid for a powerful kind of experiment. A project now under way aims to release mosquitoes that have been genetically programmed to drive themselves and their malaria-causing brethren toward extinction"
Over the last couple of months, there has been a noticeable disconnect between what conventional wisdom says should be the relationship between.
"Over the last couple of months, there has been a noticeable disconnect between what conventional wisdom says should be the relationship between stocks and bonds and what is actually occurring in those markets"
The African crowdfunding market amounts to about $70 million, less than 1% of the global market. Crowdfunding in Africa: opportunities and challenges.
“Crowdfunding—or the use of online platforms to raise money for business ventures from a large base of investors—has been steadily gaining traction in Africa over the past decade. A 2013 World Bank report estimated that by 2025, crowdfunding will be a $96 billion industry growing at a rate of 300 percent per year”
President Donald Trump wants to reverse much of the law adopted to prevent another financial crisis.
"President Donald Trump wants to dismantle much of the Dodd-Frank Act of 2010, which was designed to prevent another financial crisis. The law barred banks from many profitable but risky businesses, forced them to add loss-absorbing capital, and required them to make detailed plans for how to shut down in a crisis. Critics say it made banks wary of lending by overburdening them with rules, hampering the economic recovery. Bloomberg View columnists Tyler Cowen and Noah Smith met online to debate Trump’s proposal"
But the larger point is that there are always a multitude of safe, lucrative opportunities out there.
If you live, work, bank, invest, own a business, and hold your assets all in just one country, you are putting all of your eggs in one basket. You’re making a high-stakes bet that everything is going to be ok in that one country — forever. All it would take is for the economy to tank, a natural disaster to hit, or the political system to go into turmoil and you could lose everything—your money, your assets, and possibly even your freedom. #Investorseurope stockbrokers is your number one provide of online trading platforms for access to global stock markets
Chance to shine at World Economic Forum 2017 for South Africa's Gordhan, Ramaphosa. President Zuma won't be there. It's not exactly his happy place.
"At the World Economic Forum, where finance ministers attract as much attention as presidents, South African Finance Minister Pravin Gordhan’s presence this week in Davos is expected to be a show of strength, leadership and survival. It will also be a rare opportunity for South African Deputy President Cyril Ramaphosa to shine on the world stage since President Jacob Zuma will not be attending"
Oil prices faltered at the start of the second week of the year, as fears set in about a rapid rebound in U.S. shale production. For the better part of two months, optimism surrounding the OPEC deal has buoyed oil prices, but bullish sentiment from speculators are showing early signs of abating, raising the possibility that the oil rally is running out of steam.
WTI and Brent sank more than 2.5 percent in intraday trading on Monday, after a report at the end of last week showed another solid build in the U.S. rig count, the tenth consecutive week that the oil industry added rigs back into the field. Aside from a single week in October, the U.S. oil industry has deployed more rigs in every week dating back to June, a remarkable run that has resulted in more than 200 fresh rigs drilling for oil. The gains in the rig count come even as oil prices have held steady in the mid- to low-$50s per barrel.
At the start of 2017, there are two major dynamics at play occurring at the same time, each pushing in opposite directions on the market. The OPEC deal is slated to take oil off the market, while U.S. drilling is expected to add new supply. The pace and magnitude of each trend will ultimately drive oil prices one way or the other.
On the positive side of the ledger, there are early signs that OPEC members are meeting their commitments. Saudi Arabia said last week that it is lowering its production in January by 486,000 barrels per day, a volume that it promised to cut as part of the November deal. That will take output down to 10.058 million barrels per day, a level that Riyadh was only required to meet as an average over the January to June time period. Cutting to that level ahead of time is a sign of good faith from Saudi Arabia, and increases the chances that OPEC will stay true to its promises.
On top of that, Kuwait’s envoy to OPEC said that Qatar, Kuwait and Oman were also complying with the cuts. In an interview with Bloomberg, Kuwait’s Nawal Al-Fezaia said that those countries already told customers that cuts were imminent. "It’s a good time to do maintenance on oil fields during production cuts," Al-Fezaia said, noting that Kuwait will lower output from 2.89 mb/d in December to 2.7 mb/d by the end of January.
Market analysts paused a bit on news that Iraq’s oil exports from its southern ports on the Persian Gulf hit a record high in December, but the data has no bearing on whether or not Iraq will comply with the agreed upon cuts. "Achieving this record average will not affect Iraq’s decision to cut output from the beginning of 2017," Oil Minister Jabbar Al-Luaibi told Bloomberg in an emailed statement. "Iraq is committed to achieving producers’ joint goals to control the oil glut in world markets."
It is still early but all signs point to a stronger commitment from OPEC to adhere to the specifics of the cuts than market analysts might have given them credit for. That bodes well for a narrowing supply surplus – and ultimately a deficit – as well as falling inventories. In other words, OPEC is succeeding in putting upward pressure on prices.
However, the flip side of the equation is faster drilling from the U.S., where rig counts continue to climb. Oil output, according to EIA weekly surveys, is up roughly 300,000 bpd from summer lows, with more supply expected to come online in the months ahead as drilling picks up pace.
It is unclear, at this point, how rising U.S. supply and falling OPEC output will ultimately balance out. For now, the consensus seems to be tightening conditions in the first half of 2017, with much greater uncertainty in the second half, but that remains to be seen.
What is clear is that oil speculators have built up such a large bullish bet on oil that they have opened up crude to near-term downside risk. According to Reuters, hedge funds and other money managers amassed net-long positions in WTI and Brent equivalent to 796 million barrels in the last week of December, which was nearly double the amount from mid-November. The OPEC deal clearly fueled a huge speculative rush in rising oil prices, which, not coincidentally, corresponded with real gains in crude prices.
But at this point, there are very few short positions left in oil, while a massive volume of long bets have built up. That suggests two things, both of which are bearish for oil: there is not a lot of money left to go long, lowering the chances of further prices gains; and the potential for a correction in prices is very high at this point. Indeed, in the most recent week for which data is available, net-long positions declined a bit, raising the possibility that bullish bets have peaked. All it will take is a bit of bearish news to spark a downturn in prices.
There are a few minor worrying signs for oil prices that could crop up as additional bearish forces in the next few weeks. The U.S. DOE announced on January 9 a "notice of sale" from its strategic petroleum reserve, with plans to sell 8 million barrels for delivery over the course of February, March and April. Meanwhile, Libya is seeing rapid gains in oil exports after the reopening of a key export terminal, with output jumping to 700,000 bpd, according to the latest data, up sharply from the 580,000 it produced in November and the 300,000 bpd it exported before it started restoring output last summer. Moreover, Nigeria – which, like Libya, is exempt from the OPEC deal – is intent on restoring production. It may struggle to do that with the recent shuttering of the Trans Niger Pipeline, potential strikes from oil workers unions and the announcement from the Niger Delta Avengers that attacks will resume this year. In fact, production appears to have declined in December, falling 200,000 bpd to 1.45 mb/d, becau se of some of these issues. But if those problems can be overcome, Nigeria has latent production capacity that could come back online at some point.
And in a sign that there is not a lot of room on the upside, a kerfuffle in the Persian Gulf over the weekend did nothing to affect oil prices. A U.S. Navy destroyer fired three warning shots towards Iranian ships, an incident that in the past would have led to a sharp, even if brief, rally in crude prices. Instead, the markets shrugged off the incident – WTI and Brent sank on the first trading day after the event, on unrelated news. "The market is overbought and under a lot of downward pressure," Bob Yawger, director of the futures division at Mizuho Securities USA Inc., told Bloomberg. "The shots fired at the Iranian boats in the Strait of Hormuz didn’t do anything to the market. A few years ago that would have added a couple dollars to the price."
Link to original article: http://oilprice.com/Energy/Energy-General/Oil-Prices-Running-Out-Of-Reasons-To-Rally.html
By Nick Cunningham of Oilprice.com
Oil prices faltered at the start of the second week of the year, as fears set in about a rapid rebound in U.S. shale production. For the better part of two months, optimism surrounding the OPEC deal has buoyed oil prices, but bullish sentiment from speculators are showing early signs of abating, raising the possibility that the oil rally is running out of steam
Poor growth and political in-fighting in South Africa is holding business back.
"The big economies of Africa are struggling. Nigeria is wallowing in a recession and even with a rise in the oil price there is little hope things will improve in the near future. South Africa is beset with slow growth and political tensions that are serving to hold back progress"
A flock of doves at Bristol Zoo have taken on the challenge of becoming foster parents – and raised a group of endangered Mauiritius pink pigeons. Different pairs of Barbary doves took o
A flock of doves at Bristol Zoo have taken on the challenge of becoming foster parents – and raised a group of endangered Mauritius pink pigeons
While 86 countries - including, you'll be relieved to hear, the UK - fall into the first category, a remarkable 50 - including Russia, China, Thailand, Vietnam, Egypt, Belarus and Cuba - are in the latter.
North Korea is up there, but is it the least free country in the world? Here are the 20 most tightly controlled countries on the planet, according to Freedom House.
The four hours I spent waiting for my next flight provided some comfort in the wake of Trump, Brexit and growing nationalism.
"Economic growth in many African countries has slowed down dramatically, prompting some analysts to question the ‘Africa rising’ story. But whatever your opinion, one thing is true: Africans are on the move within their own continent"
It’s been a tough year for Nigeria. The country has slipped into its worst recession in a generation. And as a further sign of diminishing confidence in one of Africa’s most important economic powerhouses, last week saw a ratings downgrade for several of the country’s banks based on falling confidence in the government’s ability to bail them out in the event of a banking crisis..
"It’s been a tough year for Nigeria and the government of President Muhammadu Buhari. With the country’s economy already buffeted by the fall in global oil prices, resurgent militancy in the Niger delta has had a sizeable impact on oil production levels. Meanwhile, foreign investment levels are down, and a shortage in foreign exchange has created a liquidity crisis – stemming in large part from the government’s rigid efforts to prop up the embattled naira and prevent an inflationary spike"
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The use of high quality marijuana for prescribed medication will be legalized by February 2017, following efforts by the MCC to amend the Medicines and Related Substances Act, four years since Mario Ambrosini, a late member of the Inkatha Freedom Party (IFP) tabled the proposed the Medical Innovation Bill before parliament
"South Africa is set to legalize the cultivation and use of marijuana, locally called dagga, becoming the first nation in Africa to permit its medical use by April next year after the Parliamentary health committee pedaled implementation of a proposed bill"
Rush for Nairobi businesses tightens economic ties with Indian Ocean island country after signing of double tax treaty
"Mauritian firms have injected more than Sh5 billion into the economy through acquisitions and investments in Kenyan companies, indicating tightening economic links between Nairobi and the Indian Ocean Island country"
African business leaders make use of social media to communicate with and mentor their followers, dropping pearls of wisdom in under 140 characters.
"From South Africa to Nigeria, the high profile personalities and multi-millionaires from Africa offer their opinions on many issues while advancing their own agendas through social media"
Can South Africa avoid junk rating by Wall Street credit ratings services? Fitch's lowered outlook, and why South Africa can't ignore credit ratings.
"Credit ratings agency Fitch revised its outlook for South Africa from stable to negative, citing political risks, standards of governance and policy-making, but kept its BBB rating intact"
Botswana Eyes Rising Tourism Shine As Diamond Revenue Dims
"Traditionally reliant on mineral revenues especially from diamond sales, Botswana is banking on the seemingly fast improving tourism sector to become a central plank of its economic strategy"
In late January of the year 98 AD, after decades of turmoil, instability, inflation, and war, Romans welcomed a prominent solider named Trajan as their new Emperor.
Prior to Trajan, Romans had suffered immeasurably, from the madness of Nero to the ruthless autocracy of Domitian, to the chaos of 68-69 AD when, in the span of twelve months, Rome saw four separate emperors.
Trajan was welcome relief and was generally considered by his contemporaries to be among the finest emperors in Roman history.
Trajan’s successors included Hadrian and Marcus Aurelius, both of whom were also were also reputed as highly effective rulers.
But that was pretty much the end of Rome’s good luck.
The Roman Empire’s enlightened rulers may have been able to make some positive changes and delay the inevitable, but they could not prevent it.
Rome still had far too many systemic problems.
The cost of administering such a vast empire was simply too great. There were so many different layers of governments—imperial, provincial, local—and the upkeep was debilitating.
Rome had also installed costly infrastructure and created expensive social welfare programs like the alimenta, which provided free grain to the poor.
Not to mention, endless wars had taken their toll on public finances.
Romans were no longer fighting conventional enemies like Carthage, and its famed General Hannibal bringing elephants across the Alps.
Instead, Rome’s greatest threat had become the Germanic barbarian tribes, peoples viewed as violent and uncivilized who would stop at nothing to destroy Roman way of life.
Corruption and destructive bureaucracy were increasingly rampant.
And the worse imperial finances became, the more the government tried to “fix” everything by passing debilitating regulation and debasing the currency.
In his seminal work The History of the Decline and Fall of the Roman Empire, Edward Gibbon wrote:
“The story of its ruin is simple and obvious; and instead of inquiring why the Roman empire was destroyed, we should rather be surprised that it had subsisted so long.”
Gibbon was right. These trends are incredibly powerful. And once they reach a tipping point, they’re almost impossible to stop.
Similarly, though, no one has the ability to look into a crystal ball and predict with any certainty when it will all finally break down.
In today’s version of the Roman Empire, the United States, we can see similar circumstances.
The debt level is now rapidly closing in on $20 trillion, well in excess of 100% of GDP.
And even under the government’s most optimistic estimates, this debt is growing at a far more rapid rate than the economy could ever hope to expand.
We can see a central bank that is nearly insolvent.
We can see a commercial banking system that, even in the opinion of its own regulators (most recently the Federal Reserve Bank of Minneapolis), is still at significant risk to succumb to a major crisis.
We can see Civil Asset Forfeiture levels that have increased to astonishing rates.
These trends are pretty obvious, and they have been building for years.
And history shows that, whenever governments reach these tipping points, they tend to rely on a very limited playbook.
In ancient times, the Romans imposed wage and price controls under penalty of death.
In our modern era, governments default on the obligations they’ve made to taxpayers (for example, social security and pension payments).
They impose capital controls, preventing you from engaging in even the most basic financial transactions like withdrawing money from your own bank account.
They grab assets and retirement savings. They freeze accounts.
This isn’t theory or conjecture– it’s reality. Each one of these examples has actually taken place in the developed world in the past few years.
It’s not crazy or radical to acknowledge these simple facts.
Actually, denying them and pretending like these problems don’t exist seems pretty crazy.
And understanding the truth doesn’t mean that the world is coming to and end. Far from it.
But it does make sense for rational, thinking people to take some simple steps to distance themselves from the consequences of such obvious trends.
For example, if your banking system is deeply flawed, don’t keep all of your money there. Easy. Why take the chance?
Instead, consider holding a bit of cash, or perhaps move some funds to a more conservative, well-capitalized bank that’s backed by a government with zero debt.
If the fundamentals of your currency are pitiful and your central bank is nearly insolvent, don’t keep 100% of your assets denominated in it.
Consider diversifying into other currencies or owning some real assets, like productive land, profitable businesses, precious metals, cash-producing real estate.
If your government is flat broke and losing money every year, don’t keep all of your assets there, especially your retirement savings.
Consider structuring a better retirement plan where you have the latitude to move funds outside the conventional financial system and away from their easy reach.
These concepts ensure that, no matter what happens (or doesn’t happen) next, you’ll always be in a position of strength.
There may be good emperors and bad emperors, devils and saints.
And the consequences of the trends they’ve created may come to pass tomorrow, next month, next year, or perhaps (by some miracle), never at all.
But it’s hard to imagine you’ll be worse off for having a portion of your savings in a safe, well-capitalized bank as opposed to an illiquid one.
It’s hard to imagine you’re worse off because it’s more difficult for frivolous plaintiffs to sue you.
Or that the completely legal steps you’ve taken have reduced your tax bill.
Or that your new retirement plan is safer and exposed to more lucrative investment options than ever before.
Rational, thinking people don’t ignore such obvious risks. They understand that the biggest risk of all is doing nothing.
The solutions are simple, effective, and absolute no-brainers. All it takes to implement are the proper tools, the right education, and the basic will to take action.
"If your government is flat broke and losing money every year, don’t keep all of your assets there, especially your retirement savings. Consider structuring a better retirement plan where you have the latitude to move funds outside the conventional financial system and away from their easy reach. These concepts ensure that, no matter what happens (or doesn’t happen) next, you’ll always be in a position of strength" Sovereign Man
However, the big challenge is to get people in rural Africa to change their habits, according to Chad Larson: “Most of these people have been used to burning kerosene for their lighting. Their parents probably did the same thing.
"In rural Africa, the energy needs of inhabitants are very low. Mostly, people need electricity to power a few lightbulbs, to recharge their mobile phone and to plug in their portable radio. M-Kopa Solar sells basic systems which cost around USD 200 to the people with low power needs. M-Kopa offers these customers a payment plan of 50 dollar cents a day over a period of one year to purchase the system"
She received 64,227,373 votes to Trump's 62,212,752 million, according to the latest tally.
"Hillary Clinton is now more than two million votes ahead of President-elect Donald Trump in the popular vote count for the US presidential elections, a tally compiled by the Cook Political Report showed Wednesday"
Healthcare companies are developing new digital technologies to give consumers more control over the care they receive. That could upend the industry’s move toward greater consolidation and scale.
"In the not-distant future, financially accountable, tech-enabled consumers may avail themselves of a range of discrete digital health services from a variety of providers. As a result, they would be able to create their own health-management ecosystems, acting as stewards of their care and controlling not just where they access it but also how and from whom, as well as the price they pay"
Why should you travel by bus In Madagascar? It shows respect and interest in the Malagasy, and closes the gap between vahaza (foreigners) and locals.
"Given that it’s a long, slow trip from Tana to Fort Dauphin, it’s no surprise most tourists opt for the two-hour flight instead. But by taking the bus, I was inadvertently claiming solidarity in the hardships and challenges the Malagasy face on a daily basis"