Månedlige arkiver: mai 2012

Det er ikke bare norske offentlige ansatte som vil se 4%. #lønn #Volkswagen

Vw logoFra Reuters:

Volkswagen (VOWG_p.DE) will grant workers at its German factories a 4.3 percent pay increase despite difficulties in core western European markets amid the euro zone debt crisis.

The 97,000 workers at VW’s six western German plants and 5,000 employees at the financial services division will receive the additional pay over 13 months, starting June 1, Europe’s largest carmaker said on Thursday. Under the new contract, as many as 3,000 temporary workers will be hired permanently.

«This is a very good and acceptable compromise,» Hartmut Meine, chief negotiator for the IG Metall union, said at a press conference in Hanover, Germany. «We got a bit more than the overall industry.»

Earlier this month Germany’s largest labor union agreed with employers to increase wages across the country’s metal and engineering industry by 4.3 percent. The increase will benefit 3.6 million workers at companies including Daimler (DAIGn.DE) and BMW (BMWG.DE).


Om produktmål, inflasjon og nullrentegulvet #veldig #nerdete

Simon Wren-Lewis ved Oxford University forsøker å beskrive alternativer til inflasjonsmålet, nemlig produksjonsmål og hvordan dette vil skje når renten er tilnærmet null. Dette går inn i diskusjonen om hvorvidt sentralbanker vurderer inflasjon viktigere enn arbeidsledighet i rentesettingen, og at et inflasjonsmål er feil medisin i resesjoner.

Første gang han forsøkte å forklare dette var det algebra invlolvert. Vi vet alle hvor pedagogisk det er. Så her er han uten:

Output today depends on real interest rates today. Anything else that changes output today is called a shock. There is no Quantitative Easing (QE). For simplicity we will assume no direct linkage between output across periods. Inflation today depends on output today, but also expected inflation tomorrow. Prices were on target yesterday, and let’s assume that inflation the day after tomorrow is fixed. Now hit output today with a negative demand shock, a shock which is not repeated tomorrow. If that shock is small enough, we can offset it entirely by lowering interest rates today. Inflation today is unchanged as a result. Nothing changes tomorrow. Everyone is happy: monetary policy has done its job, by lowering nominal and real interest rates today.

Now suppose the negative shock today is so large, that even with nominal interest rates at zero, output remains too low. This reduces inflation today. With a target for NGDP, not only would this mean we missed our target today, but it would also mean that we would miss our NGDP target tomorrow, because lower inflation today would mean lower prices tomorrow if inflation tomorrow was unchanged. So monetary policy cuts interest rates tomorrow in order to raise tomorrow’s output and inflation. If this response is expected (we assume rational expectations throughout) it does two things. It raises inflation today directly (because inflation today depends on expected inflation tomorrow), and it reduces real interest rates today (real interest rates today are nominal rates today minus expected inflation tomorrow), which raises output today which in turn raises inflation today. This is why NGDP targets can be very helpful to combat the ZLB. If we instead targeted inflation, then monetary policy tomorrow might do nothing, because policy would still hit the inflation target tomorrow.

Now suppose that, despite relaxing monetary policy tomorrow, we still hit the ZLB today. Output and inflation are too low today, even though we hit the NGDP target tomorrow. There is absolutely no reason why this might not happen. Although inflation is higher tomorrow to compensate for low inflation today, real interest rates today are still not low enough to prevent output falling today. Sure, we could relax monetary policy tomorrow by yet more (assuming we are not at the ZLB tomorrow), and this could increase inflation tomorrow by enough to get real interest rates low enough today. But that would mean we overshoot our NGDP target tomorrow.

So, we hit the ZLB today, undershoot the NGDP target today, but meet it tomorrow. Now let output also depend on fiscal policy, and add some austerity today. This reduces output by yet more today. Interest rates are at the ZLB today, so monetary policy today can do nothing about it. Lower output lowers inflation today still further, but because this reduces the price level tomorrow, monetary policy relaxes by more tomorrow. This is good, because higher inflation tomorrow raises both inflation and output today, which moderates the impact of austerity. But the end result must be that the net impact of austerity is to reduce output and inflation today, and raise inflation tomorrow. (If output and inflation are not lower today, inflation will not change tomorrow. But if inflation tomorrow is unchanged, why has austerity not reduced output and inflation today?)

That is how a negative demand shock today, like austerity, can raise inflation tomorrow. It only happens because we have a target for the level of NGDP, and we cannot use interest rates to kill the impact of the demand shock today, because we are at the ZLB. But the latter is where we currently are, if you ignore QE.

It follows directly that excess austerity today reduces welfare, even with NGDP targets. We still hit the NGDP target tomorrow, but only by having additional excess output and inflation tomorrow, and a bigger recession today. People are clearly worse off both today and tomorrow.

This little experiment also shows us why fiscal stimulus can be more effective than a NGDP target at stabilizing the economy at a ZLB. Just put the story in reverse. Instead of excess austerity, now have a fiscal stimulus today sufficient to get NGDP back to target today. As there is no shock tomorrow (fiscal or otherwise), we also hit NGDP tomorrow. We are back to where we want to be. Now the fiscal stimulus may have meant more spending than we might have wanted in the short term, so it’s not cost free. But in terms of output and inflation, we are clearly better off as a result of the fiscal stimulus, even though we have a NGDP target.

Her er en fin oppsummering av problemene til Spania

Spain Financial Crisis 015ea

Ett av spørsmålene som besvares er: Then how did Spain get into its current mess?

It all started with a housing bubble. During the 2000s, thanks to low interest rates and an influx of foreign capital, Spain had a furious boom in housing construction — houses that, it turned out, the country didn’t really need. Below is a graph of the price-to-rent index in Spain, which gives a sense of the sheer size of the bubble. And Spain still isn’t anywhere close to recovering. Economists Cinzia Alcidi and Daniel Gros have estimated that housing prices in Spain have fallen 26 percent, but that’s still only about half of the total decline that will ultimately need to happen:

Klikk her for mer om lokale banker, pengehullet, og resten.

Deloitte forsøker å definere og måle Shadow Banking System i USA. $9,53 billioner.

Screen shot 2012 05 30 at 15 12 33

NEW YORK, May 29, 2012 — The shadow banking system in the United States might not be as large today as regulators and market participants feared, according to a new quarterly index introduced today by the Deloitte Center for Financial Services. However, with regulatory changes and financial innovation looming, the shadow banking system could creep back very quickly, the Deloitte research group cautions.

The Deloitte Shadow Banking Index shows the volatile shadow banking system totaled $9.53 trillion at the end of 2011 ‒ more than 50 percent below its peak in 2008 ‒ and a figure considerably lower than many estimates.

“With other size estimates ranging from $10 to $60 trillion, we think shadow banking is a concept continuing to look for a better definition,” said Adam Schneider, the executive director of the Deloitte Center for Financial Services.

“The purpose of the Deloitte Shadow Banking Index ‒ focused on the U.S. market only at this point – is to help define and quantify the sector over time,” continues Schneider. “We believe this will allow a better measure of size, importance, effect of market and regulatory actions, as well as a way to assess the potential impact on regulated banking markets.”

Mer her + rapport.

Som å henge flagget opp ned. #inversekurver


Dette er Eurepo, repomarkedet for å låne i europeiske banker. Det er FT Alphaville som snakker:

Because it’s a clear signal of stress in the repo market. The Eurepo curve shows the repo rate for Euro borrowing amongst European banks at maturities from 1-day to 1-year; we interpret this inverted curve as a sign that banks are unwilling to commit the collateral (required for the repo) beyond a 1-month contract. Indeed, it appears that 1-day repos are strongly preferred. The Eurepo curve has shifted a lot in a month.

In other words, banks want to be able to get collateral back and prefer short maturities. It’s also a quite negative view on Europe’s ability to handle the crisis:

Judging from the shift in the Eurepo curve, the banks themselves don’t believe that any boosts will last longer than a month.

As Sober Look noted on Friday, inverted repo curves mean stress in the market, and looking at the shift in the Eurepo curve in the last month, the level of stress has gone up considerably…

British delegates considered the American proposals for salaries to be «monstrous», but lost the argument.

Temaet er lønn og skatt i Verdensbanken. Husk, Verdensbanken er et resultat av et møte for over 68 år siden.

Christine Lagarde, scourge of tax evaders, pays no tax – Guardian

Christine Lagarde, the IMF boss who caused international outrage after she suggested in an interview with the Guardian on Friday that beleaguered Greeks might do well to pay their taxes, pays no taxes, it has emerged.

As an official of an international institution, her salary of $467,940 (£298,675) a year plus $83,760 additional allowance a year is not subject to any taxes.

The former French finance minister took over as managing director of the IMF last year when she succeeded her disgraced compatriot Dominique Strauss-Kahn, who was forced to resign after he faced charges – later dropped – of sexually attacking a New York hotel maid.

Lagarde, 56, receives a pay and benefits package worth more than American president Barack Obama earns from the United States government, and he pays taxes on it.

The same applies to nearly all United Nations employees – article 34 of the Vienna convention on diplomatic relations of 1961, which has been signed by 187 states, declares: «A diplomatic agent shall be exempt from all dues and taxes, personal or real, national, regional or municipal.»

According to Lagarde’s contract she is also entitled to a pay rise on 1 July every year during her five-year contract.

Base salaries range from $46,000 to $80,521. Senior salaries range between $95,394 and $123,033 but these are topped up with adjustments for the cost of living in different countries. A UN worker based in Geneva, for example, will see their base salary increased by 106%, in Bonn by 50.6%, Paris 62% and Peshawar 38.6%. Even in Juba, the capital of South Sudan, one of the poorest areas of the world, a UN employee’s salary will be increased by 53.2%.

Other benefits include rent subsidies, dependency allowances for spouses and children, education grants for school-age children and travel and shipping expenses, as well as subsidised medical insurance.

For many years critics have complained that IMF, World Bank, and United Nations employees are able to live large at international taxpayers’ expense.

During the 1944 economic conference at Bretton Woods, where the IMF was created, American and British politicians disagreed over salaries for the bureaucrats. British delegates, including the economist John Maynard Keynes, considered the American proposals for salaries to be «monstrous», but lost the argument.

Officials from the various organisations have long maintained that the high salaries are a way of attracting talent from the private sector. In fact, most senior employees are recruited from government posts.

God teknologihelg!

Ikke klag!

God helg.

Facebook på børs – Hva gikk galt?

Facebook Dislike ButtonFelix Salmon over hos Reuters har noen tanker.

Først Facebook Chief Financial Officer David Ebersman.

Ebersman didn’t make one big mistake, he made three. Firstly, as CFO, it was his job to accurately forecast Facebook’s second-quarter figures, and give the company’s banks a good feel for where they would come in. He failed so badly that he was forced to re-file the IPO prospectus just days before the deal came to market, and to whisper in his bankers’ ears that they should probably cut their forecasts for the company’s revenues.

There’s no excuse for getting that wrong, but if there was an excuse, it would be that Ebersman was too focused on the year-long process of managing an awesome IPO. Ha! He screwed that up, too, of course — not least by upsizing the deal at the last minute, raising the number of shares being sold by 25%. In hindsight, that was a very bad idea. But then, after that, he made his third major mistake: he priced the deal for perfection, at $38 per share, even as big institutional investors — the only ones who knew about the new revenue forecasts — were saying that they had no real desire to own the stock at more than $32 per share.

Så Chief Operating Officer Sheryl Sandberg.

Sandberg also conveniently recused herself from many IPO decisions, which doesn’t seem like a very good idea in retrospect. Either she had too much faith in Ebersman and Zuckerberg to do the right things, and should have been much more involved — or else she was deeply involved, behind the scenes, and therefore responsible for some significant part of the resulting fiasco.

Og M. Zuckerberg selv?

It’s his company: the buck stops with him. And he did the IPO no favors at all. First, he insisted on an unprecedented level of individual control over a $100 billion public company; institutional investors never like that. And secondly, he clearly viewed Wall Street and its investors with thinly-disguised contempt, slouching into IPO meetings — when he bothered to turn up at all — in his hoodie, and signally failing to provide the outward-facing leadership that investors crave. Zuckerberg’s refusal to play the Wall Street game is admirable, in some respects — but at the same time is completely inconsistent with a desire to sell $16 billion of shares at a $104 billion valuation.

Hva med ekspertene?

On the Wall Street side of things, the shame list is topped, indubitably, by Morgan Stanley’s technology banker Michael Grimes. He worked hand-in-glove with Ebersman, and all of Ebersman’s decisions can be considered Grimes’s decisions as well. More generally, it was Morgan Stanley’s job to understand exactly what the real demand was for Facebook shares — to sound out investors and price the company just a little bit below what the market was willing to pay. And there’s no doubt that Morgan Stanley failed miserably in that job.

And then there’s the whole scandal of the buried revenue forecasts: the way that Morgan Stanley whispered the new numbers in select clients’ ears, without ever letting the broader investing public know about the downgrade. If you want to develop a reputation as an untrustworthy bank which plays favorites and leaves the little guy out to dry, you could hardly do so in a more effective manner.

Og NASDAQ-flausen:

Then, of course, there’s the Nasdaq. Read Nick Carlson’s interview with an anonymous hedge-fund manager for some of the gorier details here, but in general anything that Nasdaq could mess up, it did mess up. In short: the stock never opened at 11am, as planned, because Nasdaq’s computers weren’t up to snuff. There was a five-minute delay, and then there was a second, 25-minute delay, during which time Nasdaq switched over to a second computer system.

The whole thing turned into a complete disaster. The second computer system didn’t work as planned, and there was an enormous amount of confusion — which still hasn’t been cleared up, in some cases — about where and whether various investors actually managed to sell their stock. As a rule, if you placed an order between 11:05 and 11:30 on Friday, you’re probably in a world of pain today, and you might be relying on the Nasdaq to make you whole for your losses: while you thought you were selling at $42, you might not actually have been able to sell until the shares were at $38 or even less. It seems that the opening price of $42.05 was based only on orders received before 11:05, and ignored all orders after that time, most of which were at much lower levels. Which helps to explain the initial and chaotic plunge in the stock price.

Det var halvparten av Salmons tanker. Les hele.

Overrasket over norsk vekst? Nei, hvorfor det?

Fig 2012 05 22 01
I går kunne Statistisk sentralbyrå melde om en kvartalsvekst på 1,1 prosent i Norge i første kvartal av 2012. Hvor kom veksten fra?

Vareproduksjon utenom industrien økte med 4,8 prosent og stod for nærmere halvparten av veksten i BNP Fastlands-Norge. Utviklingen i bygge- og anleggsvirksomhet ga det sterkeste vekstbidraget, hvor aktiviteten tiltok i 4. kvartal 2011 og fortsatte inn i 2012 med en sesongjustert vekst på 3,6 prosent i 1. kvartal 2012.

Vareproduksjon og bygge-og anleggsvirksomhet er sektorer som Norges Bank Regionalt nettverk dekker. Fra den siste rentebeslutningen (10. mai) til Norges Bank:

Kontaktene i vårt regionale nettverk melder om en noe høyere aktivitetsvekst enn ventet. Det er god vekst i både sysselsettingen og arbeidstilbudet. Arbeidsledigheten holder seg lav og nokså stabil. De avtalte tilleggene i lønnsforhandlingene så langt er i tråd med anslagene fra mars. Husholdningene gir uttrykk for noe sterkere optimisme om fremtidsutsiktene. Det private forbruket er noe høyere enn lagt til grunn, og veksten i boligprisene har tiltatt.

I Pengepolitisk rapport 1/12 ble det anslått at styringsrenten ville bli holdt på dagens nivå det nærmeste året. Det er tegn til at aktiviteten i norsk økonomi er litt høyere enn ventet i mars, men uroen i finansmarkedene har igjen tatt seg opp.

Det vil være en stund til vi ser en så langvarig og høy vekst i Norge som vi hadde fra 2003 og til slutten av 2007.
Screen shot 2012 05 23 at 22 39 05 Når det er sagt, veksten i Norge begynner å virkelig å presse renten opp, uavhengig av de andre faktorene.

Men dette var vel ingen overraskelse?

Når blir prisen Hellas betaler for å bli i eurosonen for stor?

Pest eller kolera 2
(Oppdatert: Link til WSJ sin spørrerunde av konsekvensene av Grexit, nederst.)

Tilfellet Hellas er kanskje det klareste eksempelet på pest eller kolera på en stund.

Pesten er prisen Hellas betaler (og har betalt) for å forbli i eurosamarbeidet. La oss se på symptomene. Landet er inne i sitt femte år i økonomisk tilbakegang. Arbeidsledigheten er 21,7 prosent. Det oversettes til 1,1 millioner arbeidsledige, 46 prosent flere enn 12 måneder siden. For de mellom 15 og 24 år er ledigheten 54 prosent, som kan forklare den store oppslutningen til Left Coalition. Ledigheten er størst i de store byene, og dermed er Athen en by på randen.

Pesten er budsjettkuttene som del av avtalen med EU, den europeiske sentralbanken og det internasjonale pengefondet. De skal betale gjeldsavdragene til Hellas i bytte for kutt i mistelønnen, 15 000 færre offentlig ansatte, kutt i pensjoner og kutt i helsevesenet.

Faktum er at da pensjonsalderen foreslås å heves fra 53 til 67, er det ikke bare politikerne som har skylden for pesten, teknokratne har også byller på hendene.

Pesten er også i ferd med å ta over demokratiet. Den sittende statsministeren er ikke folkevalgt, og valget som skulle avklare dette endte i fullt kaos. Perifere partier fikk uvanlig høy oppslutning, og ingen av partiene presterte å danne regjering. Opposisjonspartiene klarer ikke å bestemme seg hvorvidt de mener at gjeldsavtalen med EU er for streng og at de ønsker at Hellas skal forlate euroen. Det siste punktet er ikke klart, og usikkerheten tar grekerne med seg inn i andre valgrunde.

Hva er så kolera? Drakmer er kolera. Innførsel av den gamle myntenheten betyr at Hellas gir opp eurosamarbeidet, og må over natten sende ut drakmer til alle landets banker. Det var tidligere statsminister George Papandreou, mannen som er langt fra plettfri i denne tragedien, som har estimert at det vil koste mellom 500 milliarder og 1 billion euro hvis Hellas forlater eurosamarbeidet. Det er opptil tre ganger størrelsen på nasjonalproduktet til Hellas. Hvorfor vil det bli så kostbart?

Det største tapet vil være på gresk gjeld som ikke vil bli tilbakebetalt i euro. Det vil gå værst utover Tyskland og Frankrike. Redningsfondet vil tape penger, og den europeiske sentralbanken vil også tape store penger. Men dette er ikke kolera for landene involvert. Hvorfor er det kolera for Hellas?

For grekere vil innføringen av drakmer innebære enrom risiko. Hvor mye vil euro veksles for? Hvor mye vil et brød koste? Hvor mye vil importen av olje, bensin, mat og medisiner koste?

Hvis dette skjer uventet og kaotisk trekker alle ut sparepengene sine (som er i euro) ut av bankene. Bankene er ikke i stand til å betale sine lån og går konkurs. Hvis verdien på drakmer faller vil prisene øke, hvis ikke vil man få mindre betalt for samme vare. Hvem vil det?

Matmangel, politisk kaos, bensinmangel, politisk kaos, medisinmangel, politisk kaos. Politisk kaos, mindre turisme (som er nesten 20% av BNP).

Dette er den moderne versjonen av pest eller kolera for grekere. Og husk: Pesten er allerede sluppet fri. Tenk fort.

23/5: Her er Wall Street Journal sin spørrerunde til analytikerne. Danske Bank sier bl.a.:

“We are in for a long period of uncertainty but we believe that ultimately a deal will be struck between the EU/IMF and Greece that keeps Greece in the euro and austerity will continue. The alternative is too severe for both the EU and Greece.”