News and Analysis: 28 June-2 July 10 | EmergingFrontierMarkets.com

Based in: Manila, Philippines

Posted on Fri, 2 July 10:

Martin Feldstein: Inflation or deflation?--The investors that I talk to these days are not sure whether to worry more about future inflation in the US or about future deflation. America's high rate of unemployment and the low rates of capacity utilisation imply that there is little upward pressure on wages and prices. But those who emphasize the risk of inflation often point to the enormous budget deficit, notes Harvard prof/ fmr US pres.'s Council Econ Advisers chair, Proj Syndicate (courtesy Brunei Times), 25 June 10

Developing countries set to account for nearly 60% of world GDP by 2030: The rapid growth of emerging economies has led to a shift in econ power - forecasts based on analysis by the late economist Angus Maddison suggest that the aggregate econ weight of developing and emerging economies is about to surpass that of the nations that currently make up the advanced world. Acc to a new report, Perspectives on Global Development: Shifting Wealth, the econ and financial crisis is accelerating this longer-term structural transformation in the global economy, OECD, 16 June 10

Ratings, credit default swaps mismatch offers opportunities in Asia: The credit ratings of most Asian sovereign borrowers are below levels implied by their credit default swaps, creating trading opportunities in the derivatives market. Credit default swaps are insurance-like contracts that protect against defaults. An intl bank says sovereign ratings on Indonesia, Philippines and Vietnam are clear examples of the mismatch bet. investors' perception of the risk of holding these nations' debt and the evaluation of credit ratings agencies, Reuters (courtesy ForexPros), 14 June 10 (Philippine economy on the mend, but challenges to sustainable growth remain, Asian Devt Bank, Apr '10 | Philippines claims banana market, Vietnam News, 2 July)

Notice from the Publisher: "Forewarned is forearmed" - famous (almost) last words? In case some of you are wondering why we did not post from Tue to Thu, 29 June-1 July, it was - again - due to a disruption in our workflow, similar to (but not the same as) what we already reported to our visitors last Jan, and just as deserving of blame and censure, EmergingFrontierMarkets.com, 2 July 10

Posted on Mon, 28 June 10:

Fiscal consolidation and financial sector reform are what's needed now: The steps taken by govts and central banks prevented a financial system meltdown and helped bring to an end the great contraction in global econ activity, but the policy tasks that lie ahead are no less daunting than they were a yr ago, acc to the Bank's annual report released today. The 1st and most immediate challenge is to make a convincing start on reducing budget deficits in the advanced economies. At the same time, greater exchange rate flexibility in some emerging markets could improve the prospects for more balanced global growth, Bank for Intl Settlements, 28 June 10 (Post-crisis policy challenges in emerging markets)

World leaders walk econ tightrope in Canada: Wary of slamming on the stimulus brakes too quickly but shaken by the European debt crisis, world leaders pledged Sun. to reduce govt deficits in richer nations in half by '13, w/ wiggle room to meet the goal. Leaders of 20 major industrial and developing nations generally sided w/ cutting spending and raising taxes, despite warnings from Pres Obama that too much austerity too quickly could choke off the global recovery. The G20 statement limits the deficit-reduction goal to the most industrialized nations, AP (courtesy Jakarta Post), 28 June 10

Playing Field: Branko Milanovic--The world at play - Soccer takes on globalization: For many of the billion spectators who watched the World Cup opening in SAfrica, the word 'globalization' may have come to mind. From advertisers to spectators, soccer embodies globalization like no other sport. And the market for professional soccer players is, by far, the most globalized labor market. A Nigerian or Brazilian soccer player can get a job more easily in Europe or Japan than a skilled surgeon or engineer. The game offers lessons for managing movement of talented professionals around the world, says U Maryland economist, Yale U, 15 June 10 (FIFA World Cup SAfrica)

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