The Economy blog

While everyone in United States, UK, and other parts of the world are keeping their money safe inside their banks or at home, some people are willing to spend tons of dollars (or whatever their currency is) which would help in the improvement of the global economic crisis.

In Asian countries, particularly China, economists and analysts said that they will be spending a lot more of what they are keeping. Today, it is actually higher than their typical everyday expenditures. However, the savings rate today at the booming market is still expected to slide down by as much as 5 percent. Nevertheless, the consumers in Asia will add more than $900 billion to the global economy every year.

China surplus is one of the leading factors why Asian countries are willing to shell out some of their savings which would help in improving the current financial turmoil.

The CIBC World Markets recently gave its predictions about the status of the economy on the following years. In the next 8 to 10 years, they said that the economy’s behavior can be compared to the behavior of an ill-tempered teenager.

The financial sector is likely to be very unstable and very erratic as well. But after a decade, it will become mature and will eventually become more capable of handling a turmoil. This is also the same view of Benjamin Tal as well as Avery Shenfeld, two of the most popular economists.

And just like the teenagers, there will also be tons of drama in the next few years of financial crisis. It can be seen in the form of the Canadian dollar (rate increasing), inflation in the U.S. economy, higher price of the resources, higher equity, weaker market bonds, and so much more.

Despite the depression, decrease in revenues, skyrocketing unemployment rates, and other negative effects of the recession, the economic crisis can still do something good (surprisingly!).

When it comes to highway safety, it seems to be doing good. Because of the economic stress, families are now cutting down their expenses and gas consumes. Few miles are now being driven which results to lower number of road accidents and fatalities as well.

According to Everett Clendemin, the captain of the N.C. Highway Patrol, it is just plain common sense but they would accept it. Based on the road reports that they had until the month of April, the rate of fatalities due to road accidents decreased. It plunge down as the economy experiences crisis.

Just a couple of days ago, President Barack Obama signed two new laws into action. The first one is the Families Save their Homes Act while the other one is the Fraud Enforcement and Recovery Act. Both of these new legislations will help address the problems that people are facing right now in this tough economy.

Helping Families Save their Home Act – this helps the reduction of foreclosure homes all over the nation. The value of each house can be up to $6,000 and at least 10 million owners of home all over the country will also have a decreased mortgage at the same time.

Fraud Enforcement and Recovery Act – there will aid in fighting fraudulent acts that sacrifices the lives and the homes of the Americans. The Department of Justice will have more tools and steps that would help in prosecuting these scams that leads to the loss of the family’s home.

The current president of the United States believe that by protecting the homeowners of the country, the economy will also be protected and hopefully bloom so they could all survive this crisis altogether.

The AAA credit rating in Britain may end because of the poor economy that UKis having today. According to S&P, it is likely that they would remove the AAA credit rating because of its autonomous debt. If there would be a low credit rating, it would affect the consumers causing a more expensive borrowing rate.

Recently, the Pricewaterhouse Coopers said that the budget of UK decreased by as much as 8.5 billion pounds last month. Moreover, they also mentioned that there is a high possibility that every household in Britain would pay more than 5,000 pounds just to balance the country’s public finances by the year 2018.

The Bureau of Labor Statistics or BLS can only consider a mass layoff  event if there are more than 50 unemployment insurance claims coming from one employer only. These claims must only be within 5 consecutive weeks.

The BLS already showed their Mass Layoff Report for the month of April including the first two weeks of May. According to the said report, there were about 3,000 events that involved mass layoff. This clearly deteriorates the job market of United States and would give a great financial ordeal to the lives of thousands of people as well. Because of this mass layoff, there were about 250,000++ who asked for their unemployment claims.

Whenever kids get their break from school and parents can have their week-long vacation, this is the time that travel agencies, hotels, and theme parks were so preoccupied. However, things might change this season.

Studies show that many families are not packing their bags for an escapade due to the unstable economy. But many of them are hoping that they would get better deals particularly in the accommodations and the air fares as well.

More and more Americans are trying to pass on their holidays and opt to stay at home or anywhere near instead. According to the survey conducted by Associated Press/GfK Roper Public Affairs & Media, one third of the one thousands Americans are no longer willing to go for a vacation due to their financial concerns.

But if there are great deals out there (low rates without compromising the fun and relaxation which is essential in a holiday), surely these people would love to take a break away from the depressing news about the economy – even for a while.

Because of the global economic crisis, thanks to the different complicated credits, the activities of the commercial real estate slowed down. This is according to the reports made by the National Association of Realtors. Aside from that, the prediction of the various indexes tells that the said sector will still become weak until the end of 2008.

Lawrence Yun, the chief economist of the NAR, said that due to the huge unemployment rate the demand for the commercial real estate declined. Moreover, there is also a great delay in the refinancing activities as well as transactions because of the lack of credit.

During the Q4 of 2008, there activity of the commercial real estate reached by as much as 108.7 percent. Unfortunately, it decreased to 103.5 percent during the Q1 of 2009. In 2008, of the same quarter, the activity reached 118.8 percent.

According to the Standard & Poor, best known as S&P, the crisis in the banks in America haven’t started this “new phase” yet. They were talking about the crisis that it is currently facing and they believe that it would last until the year 2013.

The popular credit rating agency also said that the banking and finance industry is currently being bombarded by support from the government. There are also other lenders who are supporting the banking industry as well and they are usually the ones who consider the sector as essential in the financial system.

Tanya Azarchs, the managing director of S&P said in a recent interview that it is needless to say that the banking industry will still experience the crunch for the next three or even four years.

In Britain, the blue chip index of the country decreased by as much as 0.6 percent recently. One of the main factors to blame is the weaker prices of the raw materials which take toll on the miners and the oil producers at the same time. However, both Centrica as well as AstraZeneca were offering their support despite the index’s plunge.

Last week, the FTSE had an increase in points by as much as 5 percent. Unfortunately, their points fell down by 26.59 points closing at 4,435.5 only.

One of the most renowned sales traders of the IG Markets said that the rally for the past few weeks was the major influence for the corrections that they recently had. Philip Gillett eve said that they are thankful because they thought that the corrections would be more serious. They are also hoping that there would be improvement in the weakening economy of UK in the next weeks.