‘ Ebola Fears Start to Affect Economies With Aversion Behaviour ‘

#AceFinanceNews – October 10 – The fear of Ebola is already starting to affect economies, the president of the World Bank said on Thursday.

In some countries, for example, people are already refusing to clean planes for fear of contracting the virus.

The World Bank has estimated the cost to Africa alone at some $32.6 billion.

“What we’ve seen, the so-called aversion behaviour … the $32.6 billion is not because of the virus itself, 80 to 90 percent of that is the aversion behaviour, the stop in productivity, people don’t go to work, kids don’t go to school, there’s no flights coming in, trade slows down,” Kim said in a CNBC interview.

#AFN2014

#africa, #ebola, #economies, #economy, #planes, #virus, #world-bank

` World Bank Pledges to Extend its Financial Package to Pakistan with $12 billion over 5 Years ‘

#AceFinanceNews- PAKISTAN – May 02 – With the Election winner still undecided in Pakistan today the The World Bank has decided to extend its financial assistance to Pakistan with a pledge of $12 billion for a five-year period, the country’s finance ministry said on Friday.

The reason given according to Pakistani officials, is that the loan will target “energy, economy, (fighting) extremism and education.

” Within the framework of a 2 percent interest rate loan program the first $1 billion will be transferred to the country, hit by an energy crisis and a shortfall in tax revenues, next week.

#AFN2014

#pakistan, #world-bank

` Report from ` Bristol University ‘ says the World Bank’s Poverty Line of $1.25 is too Low and Artificial ‘

#AceFinanceNews – April 11 – (RT) – The current international poverty line of $1.25 per day used by the World Bank is “too low” and “artificial,” say researchers from Bristol University, adding that the total number of poor people worldwide would increase by 30 percent in future.

The World Bank’s “estimates are flawed” as the organization has not used “different poverty measures” and only explores one angle of the problem – financial, says the study, called “The mismeasurement of extreme global poverty: A case study in the Pacific Islands,” published in Journal of Sociology.

“There is considerable controversy surrounding the ‘dollar a day’ measure used to monitor progress against the Millennium Development Goals,” adds the research, which was carried out together with specialists at the Australian National University, UNICEF Pacific and the Economic and Social Research Council (ESRC).

“Thus, the tighter definition of poverty used by the World Bank tends to lead to a better-looking poverty trend, because the poverty line is too low the trend it reports is too rosy,” adds the study.

The paper urges the World Bank to examine “non-monetary forms of disadvantage and deprivation for families, adults and children.” Researchers looked deeper at those living on the Pacific island state of Vanuatu by taking into account shelter, sanitization, water, information, nutrition, health and education to build up a more comprehensive picture of poverty, deprivation and inequality.

Read More: http://on.rt.com/5njzp6

#AFN2014

#bristol-university, #ersc, #poverty, #poverty-line, #unicef, #world-bank, #worldwide

` Ukraine meets all conditions for the `First Tranche of Financial Assistance ‘ from the IMF by end of April ‘

#AceFinanceNews – WASHINGTON – April 11 – Ukraine’s parliament-appointed Finance Minister Oleksandr Shlapak, claims that Ukraine has complied with all terms necessary for getting the first tranche of financial assistance from the IMF.

“We are here for a more specific discussion of the time and conditions of [international] support,” Shlapak told the media in Washington where the spring meeting of the IMF and World Bank is under-way.

“Moreover, Ukraine has met all of the IMF conditions for getting the first tranche.”

The IMF earlier said it would be prepared to extend to Kiev $14-18 billion within the framework of overall international assistance of $27 billion within two years.

IMF Managing Director Christine Lagarde said on Thursday the Fund’s program for Ukraine might be presented to the IMF Board of Governors late April or in early May.

#AFN2014

#imf, #international-monetary-fund, #ukraine, #ukraines, #washington, #world-bank

` World Bank advisers working in `Kiev ‘ are ` Preparing ‘ a ` Plan of Action ‘ to Support `Ukrainian Financial Sector’

#AceFinanceNews – KIEV – March 31 – Chairman of the National Bank of Ukraine (NBU) Stepan Kubiv on Monday held the final meeting with a group of World Bank (WB) experts that worked in Ukraine in the period from March 24 to 28.

The NBU press service reported that the experts with Aleksander Pankov in the head had worked in Kiev in order “to determine the priorities and activity guidelines for the Ukrainian financial sector reform that can be implemented with support of the World Bank.”

The WB experts during last week had prepared a plan of action to promote the Ukrainian financial sector reform, the NBU press service said.

This programme can be financed by means of a WB loan worth up to one billion US dollars, granted within the programme of loans for development.

“The action plan will allow the Ukrainian banking system to make a cardinal reconstruction and strengthen stability of the banking sector,” the NBU stresses.

Simultaneously with the WB expert group, a mission of the International Monetary Fund (IMF) was working in Ukraine.

The IMF mission was co-ordinating the terms for granting a loan worth 14 – 18 billion US dollars.

Russian Finance News

#AFN2014

#imf, #international-monetary-fund, #kiev, #national-bank-of-ukraine, #nbu, #ukraine, #ukrainian, #world-bank

#AceFinanceNews Moscow March 19 The Council of IMF…

#AceFinanceNews – Moscow – March 19. The Council of IMF and World Bank Governors and a meeting of the G20 financial ministers and central bank governors will be held in Washington on April 11-13.

Storchak cited the financial crisis in Greece, which was discussed within the G20 in terms of its influence on financial stability in general.

Ukraine will not be in the focus of the G20 financial meeting in Washington in April, Russian Deputy Finance Minister Sergei Storchak said “We believe that the G20 remains a club for discussing and preparing decisions on economic issues and financial markets. This is our position,” he said. He also noted that an IMF loan to Ukraine would not be on the agenda of the Washington meeting. “The IMF has a delegation in Kiev, the delegation will return and propose a program,” Storchak said, adding that the decision to issue an IMF loan to Ukraine was in the jurisdiction of the IMF governors. #AFN2014

#g20, #imf, #international-monetary-fund, #kiev, #moscow, #ukraine, #washington, #world-bank

` World Bank to tie ` Aid ‘ to ‘ Ukraine’ and Economic Reforms’

#AceFinanceNews -Allocation of financial aid to Ukraine in the amount of $ 3 billion will depend on the effectuation of structural reforms by the Kiev government, World Bank President Jim Yong Kim said in an interview with Bloomberg.

The report said that Kim, who met with acting Ukrainian Prime Minister Arseniy Yatsenyuk in Washington this week, said it would not be easy for Ukraine to carry out the changes it has pledged.

“Even in the midst of all these political difficulties, they’re going to do things like remove fuel subsidies,” Kim said on Bloomberg TV’s “Market Makers” program.

“We feel that they’re moving forward, so we’re going to be able to move forward we think fairly quickly, if they continue on that path to being committed to those reforms,” he said.

Yatsenyuk is seeking financial aid from Western donors, including $15 billion from the IMF, Bloomberg said.
As he spoke to his hosts in Washington, he promised “real reforms” to stabilize the national economy, currently plagued by a sliding currency and deepening budget deficits.

The IMF has issued persistent calls to the Ukrainian government to reduce the deficit, to allow the currency to fluctuate and to stop paying out gas subsidies that amount to 7.5% of the Ukrainian economy.

NEW YORK, March 14, Itar-Tass

#AFN2014

 

Enhanced by Zemanta

#arseniy-yatsenyuk, #government-of-ukraine, #information-telegraph-agency-of-russia, #international-monetary-fund, #jim-yong-kim, #prime-minister-of-ukraine, #ukraine, #world-bank

#AceFinanceNews KIEV In 2014 the World Bank made…

#AceFinanceNews KIEV, In 2014, the World Bank made a decision to provide additional financial aid of $3 billion to Ukraine in order to carry out reforms and key economic projects, the Ukrainian government’s press service reported on Thursday. Itar-Tass

#AFN2014

“Three billion dollars is serious funding. This sum exceeds the funding that was provided to Ukraine last year. Most funding will be used to develop and modernize housing and communal services, improve social welfare for the population,” World Bank Director for Ukraine, Belarus and Moldova Qimiao Fan said.

#itar-tass, #kiev, #ukraine, #ukrainian, #world-bank

#World : ” State of anxiety as `Global Leaders’ wait to see just how the `US Decides What to Do’ about its `Ongoing Economic Crisis’ before its to Late”

#AceGuestNews and Views says `World Economy in Disarray, Seeks Way Out’  

The world is in a state of anxiety as global leaders wait to see just how the US decides what to do about its ongoing economic crisis.
Washington DC : A16 2000 Worldbank/IMF protests

Washington DC : A16 2000 Worldbank/IMF protests (Photo credit: Wikipedia)

It seems that the international banking cartel, which includes the World Bank and IMF are more than a little nervous that the US will let its October 17 debt ceiling deadline pass without raising the US debt limit, allowing the country to borrow billions of interest burdened dollars to make a payment on the compounding interest on a multi trillion-dollar un-payable loan.

One might think that only a country the size of the US could have such a problem, but the truth is that most of the world is suffering from the same destructive cycle of debt and austerity. That is perhaps what worries the international banks most.

They fear that if the US decides that default is a solution, other countries in the same situation might make the same decision and that would send the international banking system into a tailspin, much like what happened when borrowers stopped making payments on their sub-prime mortgages, gutting the value of those loans, thereby bursting the financial bubble international banks had created when they packaged the very high risk mortgage loans and sold them to investors. They had to know, based upon their own lending criteria that the loans would likely never be paid and at some point the flow of money would be interrupted and the house of cards would fall down.

U.S. Subprime lending expanded dramatically 20...

U.S. Subprime lending expanded dramatically 2004-2006 (Photo credit: Wikipedia)

The same thing is happening again, except instead of high risk sub-prime mortgages, we are talking about high, compounding interest on government debt. The banks don’t care so much if the principle on the debt never gets paid. They do care if the payments on the interest stops because like with mortgage payments, where the interest is also paid before the principle, the interest is the profit that belongs solely to the banks. When they don’t get that money because of any interruption in the cash flow, they fail.

So what we might be faced with is a question of who should fail? Should the governments allow their economies to collapse in order to keep the banks from failing? Should the banks give up their profit to save national economies, big and small?

Or should both realize that the game is over, and make a deal. Just like someone finally looked into the value of those packaged sub-prime mortgage loans and realized they weren’t worth a plug nickel, the people of the world have looked at their worthless currencies and their unpayable debt and realized that there is no reason for them to continue to pay. Just like the home owners realized they couldn’t keep up with their ever-increasing mortgage payments and simply walked away.

It should be clear by now that the world has reached the point that where people have figured out there simply is no point. The banks refuse to invest in job creation in the West or in countries where they are not treated favorably, or rather where they are not allowed to outright enslave the people as indentured servants or debt slaves. Notice the austerity cuts are always in the social services because when countries eliminate social services, they deny people any option except for survival except to work for low wages, for long hours, without benefits and often in unsafe work environments.

Problem:

English: Mortgage debt

English: Mortgage debt (Photo credit: Wikipedia)

Countries have taken on an extreme amount of debt to pay mostly for wars. Wars are not an investment, so they don’t pay a dividend or yield a profit. The loans to pay for the wars are based upon agreements that make the governments owe additional money called interest, which is paid to the banks as a profit for giving the loans. The interest increases by being compounded through a formula that causes it to grow continuously.

Every payment by the government on the loan, goes to pay the interest, not the principle amount of the loan. That means the loan amount increases, the interest increases, but the principle or the amount actually borrowed never decreases, making the loans unpayable.

Because the banks did not keep the promises they made when the people allowed the government to give the banks money so they would not fail after the sub-prime mortgage debacle, there is high unemployment and that means very little tax revenue. As the people lose more and more of their personal wealth, they turn to the government to subsidize their growing costs for food, housing, health care, etc. 

The costs are growing because the bank is also printing money and that increases the amount of money in circulation, making the money less valuable. So the value of the currency is also falling and it takes more dollars to purchase anything for that reason. It is called inflation. So, we have a situation where no money is being earned, not by the government and not by the people. Everyone is existing on debt. That means money is not circulating and growing, it is simply going to pay the banks on the debt.

Many people think that this is simply a problem of too many bills or over spending and not enough money from revenue to pay the bills. Because they see the problem that way, it makes sense to them that the solution to the problem is to drastically cut spending by cutting non-essential services paid for by the government.

English:

English: (Photo credit: Wikipedia)

This cutting off public services and subsidies is called austerity. 

Because the problem is not simply a matter of too many bills and not enough money, austerity does not help and actually makes the situation worse. Austerity is equivalent to removing vital organs from a patient dying from losing too much blood, claiming they must be removed because they require blood and the amount of blood is too low.

In fact, austerity actually accelerates the death, or collapse of the economy. It does this by stripping the economy of billions of dollars that produce goods, sustain jobs, finances consumption, which lead to profits, creating incentive for economic activity. Austerity is like taking a bleeding patient and opening up their arteries so they will bleed to death faster. This acceleration in decline also destabilizes societies and can lead to mass social disorder and chaos.

Solution:

BradyBondFig

BradyBondFig (Photo credit: Wikipedia)

What would happen to world economies if the international banks began to fall like dominoes? Nothing. By refusing to invest in job creation or infrastructure or energy in the West, they have made themselves irrelevant. Just like the major transnational corporations headquartered in the US, they pay such few taxes that countries don’t really depend upon their tax dollars for revenue anymore. The dwindling middle class carries most of the tax burden and as they fall deeper into poverty due to falling wages, the middle class is paying less tax and it is the loss of their tax dollars that is financially crippling western countries who are suffering from record-breaking unemployment.

What would happen if the dying economies were to suddenly collapse as the result of the debt/austerity cycle? Billions of people would be almost immediately reduced to paupers and governments would be reduced to an office with a fax, a receptionist and a lock for the red phone. There would likely be panic and a complete breakdown of social order.

The banks, rich with interest payments would lose nothing and would simply move on to ply their trade in the cash starved developing world. Problem for the banks is that after watching the fall of the largest economies in the world, the leaders of Africa and Asia are not likely to want anything to do with the international central banking system and so the banks will be all dressed up in ill-gotten gains, but will have no place to go.

The solution is to be found in a deal between the international banks and the governments. There are three basic and essential components to any deal that has a hope of success for both the banks and the governments in debt.

1. The compounding interest on the loans owed by the government must be written off by the banks. 

2. The cost to fund the government’s budget deficit without any austerity measures and the national debt must be consolidated. To this consolidated amount we must add another amount, which cannot be greater than 20% of GDP.

3. This entire amount must be loaned by the banks to the government for a simple flat fee not to exceed 15% of the total amount of the loan.

Such a deal benefits the bank in many ways. Here are three of the most important ways the banks benefit from the deal. 

1. The banks holding the notes can share the amount of compounding interest to be written off and distribute the write off over several years, significantly reducing their tax liability for those years.

2. The old debt is paid off completely, which strengthens the financial statements, significantly increasing the amount of cash and removing the old debt from the books. This gives the banks the ability to make new loans to more people and to make more money, rather than continuing to carry an unpayable debt on its books. They can perhaps triple the size of their loan portfolios.

3. They will not fail due to a major cash flow interruption and will earn a priceless amount of goodwill from the general public, the SEC and the DOJ who might otherwise be compelled to investigate the banks should there be a credit freeze, or the stock market crash, interest rates take a big unexplained jump, or should any other extraordinary economic or financial disruptions take place as a result of a US default on the loan.

When we look at it this way, it’s very easy to see that a deal between governments and the banks to prevent default and economic collapse is a win/win situation. It also creates a new model for economic recovery that removes austerity from the equation and actually allows cash starved governments to access the cash they need without the burden of compounding interest, to get their economies back on the path of growth by creating real jobs.

Courtesy and by:  Anisa Abd el Fattah

 

Enhanced by Zemanta

#united-states, #wikipedia, #world-bank