Economist’s “News and Views” Sunday 7-14-2024
Stocks At ‘1929’ Peak; 'Storm' About To Hit, Force Fed Capitulation | Tavi Costa
David Lin: 7-13-2024
Tavi Costa, Portfolio Manager at Crescat Capital, discusses the dangers of stock market valuations, the coming steepening of the yield curve, the deteriorating economy, and the Fed's response to current macroeconomic conditions.
0:00 - Intro
2:00 - Yield curve steepening
10:45 - Currencies
12:20 - Bull vs. Bear steepener
18:40 - Financial vs. “real” assets
20:57 - Fed cuts
24:00 - China’s “gold rush”
26:47 - Gold price outlook
29:50 - Dollar outlook
32:30 - Which “real asset” will outperform?
37:00 - Mining industry
47:30 - Gold’s price “floor”
Japan Dumps $22B USD In Desperate Currency Rescue, US Instructs EU To Cut Away China Investments
Sean Foo: 7-13-2024
Japan has had enough and begins its currency intervention. The Bank of Japan dumps $22 Billion dollars in order to prop up the Yen, but this is pointless.
Meanwhile, the economic war is escalating with the US telling Europe to cut investments into China. Here's what you must know!
Timestamps & Chapters:
0:00 Japan's Desperate Currency Rescue
2:45 BOJ Hiding From Janet Yellen
5:29 US Tells EU To Stop Investing In China
8:31 America's True Agenda
11:17 Economic War Escalate
US Pressure on Africa to Choose World Bank Over China: What is going on?
Fastepo: 7-14-2024
Over the past two decades, China has significantly expanded its infrastructure projects across nearly every African country. This involvement includes massive investments in roads, railways, ports, and other critical infrastructure, amounting to over $140 billion in loans for various projects.
As of 2020, around 49 African countries had signed agreements under China's Belt and Road Initiative (BRI), highlighting the extensive reach of these projects.
China-Africa trade surged from $11.67 billion in 2000 to $257.67 billion in 2022, making China the leading trading partner for many African countries, surpassing traditional partners like the UK and the US.
Chinese FDI flows to Africa rose from $75 million in 2003 to a peak of $5 billion in 2021. Western critics, popularized the term "debt-trap diplomacy" to describe China's strategy.
This term suggests that China provides loans for infrastructure projects that recipient countries cannot afford to repay, ultimately allowing China to exert strategic control over these nations. Examples often cited include Zambia and Uganda.
Zambia, for instance, is heavily indebted to China, with approximately $5.05 billion owed, which is about 30% of its total external debt and roughly 20% of its GDP. In Uganda, there are fears that the Entebbe International Airport could be taken over by China due to the terms of their loan agreements.
However, this perspective is contested. Proponents argue that China's investments have brought significant infrastructure improvements and economic benefits to Africa. They note that many Chinese projects have created jobs, enhanced business opportunities, and facilitated connectivity.
For instance, Chinese telecommunications company Huawei has expanded digital connectivity across 40 African countries. Furthermore, Chinese-built railways, like the one connecting Nairobi to Mombasa in Kenya, are seen as critical to boosting local economies.
Critics from the West argue that these benefits are overshadowed by the long-term economic risks and the lack of transparency in Chinese loan agreements. They assert that the opacity and potentially exploitative nature of these loans can undermine the sovereignty and financial stability of African nations. In contrast, defenders of China's involvement highlight the historical context of Western colonialism and the ongoing need for infrastructure in Africa, which Western countries have not adequately addressed.
They argue that labeling Chinese investments as "debt-trap diplomacy" oversimplifies the complex economic relationships and the mutual benefits derived from these projects. In this video, we delve into the heart of China's relationship with Africa, investigating why many African countries favor partnerships with China over those with Western nations.
Additionally, we discuss the initiatives by the European Union and the United States—Global Gateway and Build Back Better World (B3W)—and how these compare to China's efforts.