Showing posts with label Spain. Show all posts
Showing posts with label Spain. Show all posts

Sunday, March 17, 2013

Borrowing ‘Riches’ no More

With the Economic Recession bringing about Unprecedented levels of Public Debt, The Industrialized Nations on Earth are facing their Worst ever fears of Insolvency and High Levels of Inflation if Current Profligate Fiscal and Monetary Policies Continue Unabated

Riches running on debt

It was for the first time ever since World War II that the public debt of the industrialized nations actually crossed the primary balance figure as percentage of GDP showing the biggest signs of crumbling for the global financial system triggered by the subprime mortgage crisis. In fact, overall fiscal balances (net of government financial rescue programmes) have been deteriorating sharply since the crisis began, rising by 20 to 30 percentage points of GDP in just 3 years. But the biggest problem this time is that employment and growth are unlikely to return to pre-crisis levels in the foreseeable future partly due to large scale outsourcing. Thus, unemployment and other benefits would be paid for several years and high levels of public investment will have to be maintained.

It’s costly getting old

With the European economies ageing fast led by big EU economies countries like Germany, Italy and Spain coupled with their cradle to grave kind social welfare systems, EU is in for a long rough ride with a further swelling of its healthcare and pension budgets in the future. greece has already capitulated while many others are almost insolvent. On the other hand, USA, the world’s most populous nation with a near universal healthcare system, is already bleeding with a colossal budget deficit resulting in sky high debt levels. It is projected that in order to meet its age-related spending liabilities the United States would need a permanent improvement in its budget balances of the order of 2.6% of 2009 GDP in the next 50 years and 3.2% in 75 years.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

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Tuesday, October 16, 2012

Alright, Hallelujah! What next?

How religious leaders can help the world for its betterment

A close scrutiny exemplifies the fact that be it the Pope in Christianity or Dalai Lama in Buddhism, Rabbis in Judaism or Imams in Islam, religious leaders do all have implicit and explicit influences in the lives of even non-devotees.

To start off with, Pope Benedict XVI. Given the current global scenario, each of the Pope’s visits, addresses to the common people, official statements marks history. For instance, his mind-boggling address to the youths of Germany, inter-faith talks with Jews and Muslims and many other similar visits to Brazil, Austria, Poland, Spain, Turkey and the US have been overwhelmingly successful in garnering more international attention than his religious designation should warrant.


Source : IIPM Editorial, 2012.

For More IIPM Info, Visit below mentioned IIPM articles.
 
IIPM : The B-School with a Human Face
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Friday, July 27, 2012

“If The World Collapses, we will feel The Pain”

Arvind Mehta, Joint Secretary, Ministry of Commerce, Government of India

B&E: What is the growth forecast of commerce in 2011 for India?
Arvind Mehta (AM): Exports should touch $300 billion. It’s a little ambitious to my expectations, mainly because of 3 or 4 major sectors. Petroleum exports are going to be high mainly because we have gained higher refinery capacity. This is presupposing that no major bump happens in the European economy, which is an area of great concern. The American Economy is also a concern but right now, the focus is on what’s happening in Italy, Greece, Portugal, Spain, and Ireland.

B&E: What would be the level of impact on Indian economy if there is a European economic crisis, something which is very much expected?
AM: There can be an overall slowdown that can impact the domestic side also. But I am always optimistic that we can outperform the other economies. So whatever happens, it has to be seen in relevant terms, as we are looking at 8.5% economic growth right now.

B&E: Talking about inflation, how much do you think this could impact the entire demand-supply situation?
AM: Everybody seems to take inflation numbers wrongly and it is difficult to have a guess but generally if you look at it the optimistic way, then the authorities try and contain the inflation rate to below 5% but that never works out. The more realistic kind of people talk about the Inflation rate at about 7-8% which is reasonably a good estimate. So if your monsoon is good, we should not worry about double digit inflation and if it’s good and you are able to control inflation even at the level of 7-8%, then it’s something, which the Indian economy has been taking its stride since many many years in the past. In fact, one good news happening in a sense is if we look at last year’s inflation, which was close to 11% and the growth rate, which was almost 9%. So in nominal terms, we grew at nearly 20% and in real terms, we grew at nearly 9%.

B&E: Do you feel that falling growth rate combined with the European and American economic situation could hamper our growth?
AM: We have seen some slowdown; at least that’s what most people think. There is rationale in the view that Indian economy will also see some slowdown but as long as export markets are not impacted too heavily, the slowdown may be more moderate in comparison.


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