one hedge fund manager can pocketed $ 1,3 bio (2014)!
This reminded me of a famous Wall Street joke – about a visitor to New York who admired the gorgeous yachts of the richest bankers and brokers. After gazing long and thoughtfully at these beautiful boats, the visitor asked wryly: “Where are the customers’ yachts?” Of course, the customers could not afford yachts, even though they dutifully followed the advice of their bankers and brokers.
Post Globalization Issues and Power shift of the CenturyZeeshanMajeed15
GlobalizationWe can define globalization as the increasing interdependence and integration of economies, markets, nations, and cultures.
OR
Globalization envisages a borderless world or seeks the world as a global village.
OR
Globalization is the flow across national borders of trade, finance, people, and of course ideas.
Power shift of the CenturyEra of globalization is ending and giving way to new power centers.
Globalization world was where interconnectedness and the people used to do the same in terms of law and approaches but now we are witnessing the clash of civilizations.
We are now going to a multipolar world where at least three big regions do things increasingly differently.
The Brazilian Economy is one of the oldest publications for expert economic analysis of both the Brazilian and international economies. Through this publication, FGV’s Brazilian Institute of Economics and Finance (FGV/IBRE) compares different periods of the economy, assessing both macroeconomic considerations and scenarios related to finance, administration, marketing, management, insurance, statistics, and price indices.
For more information, and Brazilian economic index results, visit: http://bit.ly/1EA1Loz
Credit Suisse Global Investment Returns Yearbook 2016 Credit Suisse
Against the backdrop of the first interest rate increase by the Federal Reserve in almost a decade, the Credit Suisse Research Institute’s Global Investment Returns Yearbook examines similar episodes since 1900 and derives potential implications for future economic and financial market developments.
- Download the full report: http://bit.ly/1QSo6qn
- Order hard copy: http://bit.ly/1T9sTbe
- Visit the website: bit.ly/18Cxa0p
Post Globalization Issues and Power shift of the CenturyZeeshanMajeed15
GlobalizationWe can define globalization as the increasing interdependence and integration of economies, markets, nations, and cultures.
OR
Globalization envisages a borderless world or seeks the world as a global village.
OR
Globalization is the flow across national borders of trade, finance, people, and of course ideas.
Power shift of the CenturyEra of globalization is ending and giving way to new power centers.
Globalization world was where interconnectedness and the people used to do the same in terms of law and approaches but now we are witnessing the clash of civilizations.
We are now going to a multipolar world where at least three big regions do things increasingly differently.
The Brazilian Economy is one of the oldest publications for expert economic analysis of both the Brazilian and international economies. Through this publication, FGV’s Brazilian Institute of Economics and Finance (FGV/IBRE) compares different periods of the economy, assessing both macroeconomic considerations and scenarios related to finance, administration, marketing, management, insurance, statistics, and price indices.
For more information, and Brazilian economic index results, visit: http://bit.ly/1EA1Loz
Credit Suisse Global Investment Returns Yearbook 2016 Credit Suisse
Against the backdrop of the first interest rate increase by the Federal Reserve in almost a decade, the Credit Suisse Research Institute’s Global Investment Returns Yearbook examines similar episodes since 1900 and derives potential implications for future economic and financial market developments.
- Download the full report: http://bit.ly/1QSo6qn
- Order hard copy: http://bit.ly/1T9sTbe
- Visit the website: bit.ly/18Cxa0p
More than six years have passed since the subprime mortgage crisis began in the US in the summer of 2007. In the following year, it spread to the entire world economy. Its consequences have not been fully overcome yet. Thus it’s not surprising that economists’ attention has been largely devoted to short-term, crisis-related issues like financial deleveraging and repairing the balance sheets of governments, corporations and households. For the macroeconomic policy debate, this means concentrating on demand management by using monetary and fiscal policy tools in order to return to a pre-crisis growth path. Rarely has the question been asked of whether or not this is a realistic goal, i.e., whether post-crisis growth can return to pre-crisis levels. An analysis of growth perspectives in the medium-to-longterm calls for using the neo-classical growth theory, according to which there are three factors at play: labor, capital and total factor productivity (TFP). In this brief we will try to figure out what their expected dynamics are and how much each of them can contribute to economic growth in the foreseeable future.
Authored by: Marek Dabrowski
Published in 2013
What some of the most informed people in the world have said about 2016. First off, if you are expecting this quarterly to tell you all about the juicy investment opportunities available to your family in 2016, you may be disappointed
because the subsequent paragraphs are not going to discuss that information.
Although you may glean some insight from the views expressed herein, our Q2 edition will contain more financial and economic information. The opportunities we are referring to in this article are qualitative in nature - but they do come with a price tag that you determine.
There is no doubt that 2016 will be a year of economic & financial challenges, globally. In our opinion, 2016, represents an opportunity for your family to prepare. Our view is that, if you havent already started doing so, you should discuss repositioning your family’s wealth strategy to thrive in the coming years. By now you should be aware that at PANGEA, we define wealth differently than most.
At PANGEA we recognize that wealth transcends dollars and decimals to also include the human elements of personal well-being, family intellectual capital and family & community legacy. What follows in no way represents advice, rather it is a curated composition of perspectives of what some of the best informed, wealthiest families in the world have already done to prepare in advance of the finanical and economic shifts on the horizon.
The current global economic crisis, its consequences, impact and the road to ...Warwick Business School
José Juan Ruiz Gómez, Director of Analysis & Strategy, Santander Group, presented on the current global economic crisis, its consequences, impact and the road to recovery in Latin America, at Warwick Business School 02/06/2009
Ricardo V Lago -Interbank- Lima-22 04 2009 neiracar
Conferencia a la alta Gerencia de Intergroup en Lima el 22 de abril , 2009 sobre perspectivas de las economias mundial y peruana y oportunidades de inversion en bolsa
[MOST SOLD]Unbound: How Inequality Constricts Our Economy and What We Can Do ...gaxevepe
From one of Washington's most influential voices on economic policy, a lively and original argument that reducing inequality is not just fair but also key to delivering broadly shared economic growth and stability.Do we have to choose between equality and prosperity? Many think that reducing economic inequality would require such heavy-handed interference with market forces that it would stifle economic growth. Heather Boushey, one of Washington's most influential economic voices, insists nothing could be further from the truth. Presenting cutting-edge economics with journalistic verve, she shows how rising inequality has become a drag on growth and an impediment to a competitive US marketplace for employers and employees alike.Boushey argues that inequality undermines growth in three ways. It obstructs the supply of talent, ideas, and capital as wealthy families monopolize the best educational, social, and economic opportunities. It also subverts private competition and public investment. Powerful corporations muscle competitors out of business, in the process costing consumers, suppressing wages, and hobbling innovation, while governments underfund key public goods that make the American Dream possible, from schools to transportation infrastructure to information and communication technology networks. Finally, it distorts consumer demand as stagnant wages and meager workplace benefits rob ordinary people of buying power and pushes the economy toward financial instability.Boushey makes this case with a clear, accessible tour of the best of contemporary economic research, while also injecting a passion for her subject gained through years of research into the economics of work-life conflict and policy work in the trenches of federal government. Unbound exposes deep problems in the US economy, but its conclusion is optimistic. We can preserve the best of our nation's economic and political traditions, and improve on them, by pursuing policies that reduce inequality--and by doing so, boost broadly shared economic growth.
More than six years have passed since the subprime mortgage crisis began in the US in the summer of 2007. In the following year, it spread to the entire world economy. Its consequences have not been fully overcome yet. Thus it’s not surprising that economists’ attention has been largely devoted to short-term, crisis-related issues like financial deleveraging and repairing the balance sheets of governments, corporations and households. For the macroeconomic policy debate, this means concentrating on demand management by using monetary and fiscal policy tools in order to return to a pre-crisis growth path. Rarely has the question been asked of whether or not this is a realistic goal, i.e., whether post-crisis growth can return to pre-crisis levels. An analysis of growth perspectives in the medium-to-longterm calls for using the neo-classical growth theory, according to which there are three factors at play: labor, capital and total factor productivity (TFP). In this brief we will try to figure out what their expected dynamics are and how much each of them can contribute to economic growth in the foreseeable future.
Authored by: Marek Dabrowski
Published in 2013
What some of the most informed people in the world have said about 2016. First off, if you are expecting this quarterly to tell you all about the juicy investment opportunities available to your family in 2016, you may be disappointed
because the subsequent paragraphs are not going to discuss that information.
Although you may glean some insight from the views expressed herein, our Q2 edition will contain more financial and economic information. The opportunities we are referring to in this article are qualitative in nature - but they do come with a price tag that you determine.
There is no doubt that 2016 will be a year of economic & financial challenges, globally. In our opinion, 2016, represents an opportunity for your family to prepare. Our view is that, if you havent already started doing so, you should discuss repositioning your family’s wealth strategy to thrive in the coming years. By now you should be aware that at PANGEA, we define wealth differently than most.
At PANGEA we recognize that wealth transcends dollars and decimals to also include the human elements of personal well-being, family intellectual capital and family & community legacy. What follows in no way represents advice, rather it is a curated composition of perspectives of what some of the best informed, wealthiest families in the world have already done to prepare in advance of the finanical and economic shifts on the horizon.
The current global economic crisis, its consequences, impact and the road to ...Warwick Business School
José Juan Ruiz Gómez, Director of Analysis & Strategy, Santander Group, presented on the current global economic crisis, its consequences, impact and the road to recovery in Latin America, at Warwick Business School 02/06/2009
Ricardo V Lago -Interbank- Lima-22 04 2009 neiracar
Conferencia a la alta Gerencia de Intergroup en Lima el 22 de abril , 2009 sobre perspectivas de las economias mundial y peruana y oportunidades de inversion en bolsa
[MOST SOLD]Unbound: How Inequality Constricts Our Economy and What We Can Do ...gaxevepe
From one of Washington's most influential voices on economic policy, a lively and original argument that reducing inequality is not just fair but also key to delivering broadly shared economic growth and stability.Do we have to choose between equality and prosperity? Many think that reducing economic inequality would require such heavy-handed interference with market forces that it would stifle economic growth. Heather Boushey, one of Washington's most influential economic voices, insists nothing could be further from the truth. Presenting cutting-edge economics with journalistic verve, she shows how rising inequality has become a drag on growth and an impediment to a competitive US marketplace for employers and employees alike.Boushey argues that inequality undermines growth in three ways. It obstructs the supply of talent, ideas, and capital as wealthy families monopolize the best educational, social, and economic opportunities. It also subverts private competition and public investment. Powerful corporations muscle competitors out of business, in the process costing consumers, suppressing wages, and hobbling innovation, while governments underfund key public goods that make the American Dream possible, from schools to transportation infrastructure to information and communication technology networks. Finally, it distorts consumer demand as stagnant wages and meager workplace benefits rob ordinary people of buying power and pushes the economy toward financial instability.Boushey makes this case with a clear, accessible tour of the best of contemporary economic research, while also injecting a passion for her subject gained through years of research into the economics of work-life conflict and policy work in the trenches of federal government. Unbound exposes deep problems in the US economy, but its conclusion is optimistic. We can preserve the best of our nation's economic and political traditions, and improve on them, by pursuing policies that reduce inequality--and by doing so, boost broadly shared economic growth.
The Railway Supply Institute Membership BrochureBrian Kellman
The Railway Supply Institute (RSI) is home to over 250 members companies who provide products and services to the world's railroads. If your company is involved in the rail industry in any capacity, a membership, you belong with RSI. This brochure will give you a brief overview why.
FUTURE AGENDA: Future of wealth (initial-perspective) Prof. Julio J. PradoJulio Jose Prado
In the post-recession era,
there is an increasing concern
on topics related to wealth
inequality in Developed
countries, most notably in
the USA and the Euro Zone.
56% of people living in rich
countries, believe the most
pressing problem of the
economy is inequality.
The article illustrates the results of the economic development of the first fifteen years of the XXI century under the conditions of unprecedented economic freedom, globalization and the appearance of new informational sectors up to and including the first attempts at revising liberalism. The analysis of statistical data demonstrates an obvious increase in the percentage of well-off people in many countries as well as the increased economic capabilities of small, medium and large businesses, whose assets are distributed among an ever-increasing number of owners. This provides the impetus to review our collective approach to liberalization and globalization, as well as to view its unexpected strong sides that make human progress possible.
Instructions1. On the top of the page, provide the article citat.docxnormanibarber20063
Instructions
1. On the top of the page, provide the article citation in current APA format.
On the next line down, type the topic of your articles: (Gross Domestic Product (GDP)
in all caps and bold format.
2. In a double-spaced document, briefly explain the author’s purpose for writing the article. One way to understand the author’s purpose is to ask yourself why he or she wrote it. (For example, consider current and future events, politics, or anything else that may have inspired the article.)
3. Summarize the article(The criminality of Wall Street), focusing on the discussion of the topic the article addresses. Incorporate relevant economic theory that is present so that discussion of the article content is clear.
Article: The Criminality of Wall Street
Tabb, William K. Monthly Review66.4 (Sep 2014): 13-22.
The current stage of capitalism is characterized by the increased power of finance capital. How to understand the economics of this shift and its political implications is now central for both the left and the larger society. There can be little doubt that a signature development of our time is the growth of finance and monopoly power.1
In 1980 the nominal value of global financial assets almost equaled global GDP. In 2005 they were more than three times global GDP.2 The nominal value of foreign exchange trading increased from eleven times the value of global trade in 1980 to seventy-three times in 2009.3 Of course it is not certain what this increase means, since such nominal values can fluctuate widely, as we saw in the Great Financial Crisis. They cannot be compared directly and without all sorts of qualifications to the value added in the real economy. But they do give an impressionistic sense of the enormous magnitude by which finance grew and came to dominate the economy. Between 1980 and 2007, derivative contracts of all kinds expanded from $1 trillion globally to $600 trillion.4 Hedge funds and private equity groups, special investment vehicles, and mega-bank holding companies changed the face of Western capitalism. They also brought on the collapse from which we still suffer. Ordinary people may not be acquainted with the numbers (and even those best informed are not sure of their significance), but people generally understand in different and often deep ways what has been happening: namely, an ongoing process of financialization that has come to dwarf production.
What is particularly important is that despite the huge bubble created by this metastasizing growth of finance, the economy did not expand as rapidly as it had in the postwar years, before the goods producing industries lost ground in terms of employment to other sectors of the economy, and when government spending was used actively to promote growth. While the nature of much of the growth that occurred then is certainly open to criticism from all sorts of standpoints, at the time there was widespread understanding in policy circles that government spending was.
Ping Jiang discusses ways in which political unrest and economic uncertainty affect markets. Post recession, less developed markets have recovered more quickly than those with more wealth. Ping Jiang explores why seeing these differently might change thoughts on investment.
Based on Erik Reinert, How Rich Countries Got Rich ... and Why Poor Countries Stay Poor (2007), London: Constable, Chapter 8: “Get the economic activities right”, or, the Lost Art of Creating Middle-Income Countries. Further discussion on how to make upper-middle income county out of middle-income trap. And how to synchronize different aspect on developmental policy in modern era.
how to sell pi coins effectively (from 50 - 100k pi)DOT TECH
Anywhere in the world, including Africa, America, and Europe, you can sell Pi Network Coins online and receive cash through online payment options.
Pi has not yet been launched on any exchange because we are currently using the confined Mainnet. The planned launch date for Pi is June 28, 2026.
Reselling to investors who want to hold until the mainnet launch in 2026 is currently the sole way to sell.
Consequently, right now. All you need to do is select the right pi network provider.
Who is a pi merchant?
An individual who buys coins from miners on the pi network and resells them to investors hoping to hang onto them until the mainnet is launched is known as a pi merchant.
debuts.
I'll provide you the Telegram username
@Pi_vendor_247
Poonawalla Fincorp and IndusInd Bank Introduce New Co-Branded Credit Cardnickysharmasucks
The unveiling of the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card marks a notable milestone in the Indian financial landscape, showcasing a successful partnership between two leading institutions, Poonawalla Fincorp and IndusInd Bank. This co-branded credit card not only offers users a plethora of benefits but also reflects a commitment to innovation and adaptation. With a focus on providing value-driven and customer-centric solutions, this launch represents more than just a new product—it signifies a step towards redefining the banking experience for millions. Promising convenience, rewards, and a touch of luxury in everyday financial transactions, this collaboration aims to cater to the evolving needs of customers and set new standards in the industry.
BYD SWOT Analysis and In-Depth Insights 2024.pptxmikemetalprod
Indepth analysis of the BYD 2024
BYD (Build Your Dreams) is a Chinese automaker and battery manufacturer that has snowballed over the past two decades to become a significant player in electric vehicles and global clean energy technology.
This SWOT analysis examines BYD's strengths, weaknesses, opportunities, and threats as it competes in the fast-changing automotive and energy storage industries.
Founded in 1995 and headquartered in Shenzhen, BYD started as a battery company before expanding into automobiles in the early 2000s.
Initially manufacturing gasoline-powered vehicles, BYD focused on plug-in hybrid and fully electric vehicles, leveraging its expertise in battery technology.
Today, BYD is the world’s largest electric vehicle manufacturer, delivering over 1.2 million electric cars globally. The company also produces electric buses, trucks, forklifts, and rail transit.
On the energy side, BYD is a major supplier of rechargeable batteries for cell phones, laptops, electric vehicles, and energy storage systems.
USDA Loans in California: A Comprehensive Overview.pptxmarketing367770
USDA Loans in California: A Comprehensive Overview
If you're dreaming of owning a home in California's rural or suburban areas, a USDA loan might be the perfect solution. The U.S. Department of Agriculture (USDA) offers these loans to help low-to-moderate-income individuals and families achieve homeownership.
Key Features of USDA Loans:
Zero Down Payment: USDA loans require no down payment, making homeownership more accessible.
Competitive Interest Rates: These loans often come with lower interest rates compared to conventional loans.
Flexible Credit Requirements: USDA loans have more lenient credit score requirements, helping those with less-than-perfect credit.
Guaranteed Loan Program: The USDA guarantees a portion of the loan, reducing risk for lenders and expanding borrowing options.
Eligibility Criteria:
Location: The property must be located in a USDA-designated rural or suburban area. Many areas in California qualify.
Income Limits: Applicants must meet income guidelines, which vary by region and household size.
Primary Residence: The home must be used as the borrower's primary residence.
Application Process:
Find a USDA-Approved Lender: Not all lenders offer USDA loans, so it's essential to choose one approved by the USDA.
Pre-Qualification: Determine your eligibility and the amount you can borrow.
Property Search: Look for properties in eligible rural or suburban areas.
Loan Application: Submit your application, including financial and personal information.
Processing and Approval: The lender and USDA will review your application. If approved, you can proceed to closing.
USDA loans are an excellent option for those looking to buy a home in California's rural and suburban areas. With no down payment and flexible requirements, these loans make homeownership more attainable for many families. Explore your eligibility today and take the first step toward owning your dream home.
what is the best method to sell pi coins in 2024DOT TECH
The best way to sell your pi coins safely is trading with an exchange..but since pi is not launched in any exchange, and second option is through a VERIFIED pi merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and pioneers and resell them to Investors looking forward to hold massive amounts before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade pi coins with.
@Pi_vendor_247
The European Unemployment Puzzle: implications from population agingGRAPE
We study the link between the evolving age structure of the working population and unemployment. We build a large new Keynesian OLG model with a realistic age structure, labor market frictions, sticky prices, and aggregate shocks. Once calibrated to the European economy, we quantify the extent to which demographic changes over the last three decades have contributed to the decline of the unemployment rate. Our findings yield important implications for the future evolution of unemployment given the anticipated further aging of the working population in Europe. We also quantify the implications for optimal monetary policy: lowering inflation volatility becomes less costly in terms of GDP and unemployment volatility, which hints that optimal monetary policy may be more hawkish in an aging society. Finally, our results also propose a partial reversal of the European-US unemployment puzzle due to the fact that the share of young workers is expected to remain robust in the US.
What price will pi network be listed on exchangesDOT TECH
The rate at which pi will be listed is practically unknown. But due to speculations surrounding it the predicted rate is tends to be from 30$ — 50$.
So if you are interested in selling your pi network coins at a high rate tho. Or you can't wait till the mainnet launch in 2026. You can easily trade your pi coins with a merchant.
A merchant is someone who buys pi coins from miners and resell them to Investors looking forward to hold massive quantities till mainnet launch.
I will leave the telegram contact of my personal pi vendor to trade with.
@Pi_vendor_247
where can I find a legit pi merchant onlineDOT TECH
Yes. This is very easy what you need is a recommendation from someone who has successfully traded pi coins before with a merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi network coins and resell them to Investors looking forward to hold thousands of pi coins before the open mainnet.
I will leave the telegram contact of my personal pi merchant to trade with
@Pi_vendor_247
how to sell pi coins in all Africa Countries.DOT TECH
Yes. You can sell your pi network for other cryptocurrencies like Bitcoin, usdt , Ethereum and other currencies And this is done easily with the help from a pi merchant.
What is a pi merchant ?
Since pi is not launched yet in any exchange. The only way you can sell right now is through merchants.
A verified Pi merchant is someone who buys pi network coins from miners and resell them to investors looking forward to hold massive quantities of pi coins before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
how to swap pi coins to foreign currency withdrawable.DOT TECH
As of my last update, Pi is still in the testing phase and is not tradable on any exchanges.
However, Pi Network has announced plans to launch its Testnet and Mainnet in the future, which may include listing Pi on exchanges.
The current method for selling pi coins involves exchanging them with a pi vendor who purchases pi coins for investment reasons.
If you want to sell your pi coins, reach out to a pi vendor and sell them to anyone looking to sell pi coins from any country around the globe.
Below is the contact information for my personal pi vendor.
Telegram: @Pi_vendor_247
The secret way to sell pi coins effortlessly.DOT TECH
Well as we all know pi isn't launched yet. But you can still sell your pi coins effortlessly because some whales in China are interested in holding massive pi coins. And they are willing to pay good money for it. If you are interested in selling I will leave a contact for you. Just telegram this number below. I sold about 3000 pi coins to him and he paid me immediately.
Telegram: @Pi_vendor_247
The Evolution of Non-Banking Financial Companies (NBFCs) in India: Challenges...beulahfernandes8
Role in Financial System
NBFCs are critical in bridging the financial inclusion gap.
They provide specialized financial services that cater to segments often neglected by traditional banks.
Economic Impact
NBFCs contribute significantly to India's GDP.
They support sectors like micro, small, and medium enterprises (MSMEs), housing finance, and personal loans.
The Evolution of Non-Banking Financial Companies (NBFCs) in India: Challenges...
Lifting the small boats
1. Lifting the Small Boats
By Christine Lagarde, Managing Director, IMF
Address at Grandes Conferences Catholiques
Brussels, June 17, 2015
As prepared for delivery
Introduction
Good evening! I am absolutely delighted to participate again in this prestigious conference,
and I would like to thank Vice Premier Reynders for his kind introduction.
Last month, on May 6th
, I almost choked on my morning yoghurt when I saw the front page
of a leading business newspaper. There it was – a league table of the world’s best paid
hedge fund managers. It showed that the highest earner was able to pocket $1.3 billion in
2014. One man, $1.3 billion!
Together, the 25 best-paid hedge fund managers earned a combined $12 billion last year,
even as their industry suffered from largely mediocre investment performance.
This reminded me of a famous Wall Street joke – about a visitor to New York who admired
the gorgeous yachts of the richest bankers and brokers. After gazing long and thoughtfully at
these beautiful boats, the visitor asked wryly: “Where are thecustomers’ yachts?” Of course,
the customers could not afford yachts, even though they dutifully followed the advice of their
bankers and brokers.
Why is this relevant right now? Because the theme of growing and excessive inequality is not
only back in the headlines, it has also become a problem for economic growth and
development. I would like to take an economic perspective on this with you tonight. I
will not focus on the gorgeous yachts of the super-rich, who have become the face of a new
Gilded Age. It is not immoral to enjoy one’s financial success.
But I would like to bring into the discussion what I would call the “small boats” – the
livelihoods and economic aspirations of the poor and the middle class.
In too many countries, economic growth has failed to lift these small boats – while the
gorgeous yachts have been riding the waves and enjoying the wind in their sails. In too
many cases, poor and middle-class households have come to realize that hard work and
determination alone may not be enough to keep them afloat.
Too many of them are now convincedthat the systemis somehow rigged, that the odds are
stacked against them. No wonder that politicians, business leaders, top-notch economists,
and even central bankers are talking about excessive inequality of wealth and income. And
these concerns can be heard across the political spectrum. In the United States, for example,
President Obama and Republican leaders in the Congress agree that this is one of the
defining issues of our time – one that needs not only a diagnosis but a cure.
My key message tonight is this: reducing excessive inequality – by lifting the “small boats” –
is not just morally and politically correct, but it is good economics.
You do not have to be an altruist to support policies that lift the incomes of the poor and the
middle class. Everybody will benefit from these policies, because they are essential to
generate higher, more inclusive, and more sustainable growth.
In other words, if you want to see more durable growth, you need to generate
more equitable growth. With this in mind, I would like to focus on three issues:
1. The global economic outlook.
2. The causes and consequences of excessive inequality.
3. The policies needed for stronger, more inclusive, and more sustainable growth.
1. The Global Economic Weather Is Not Helping Much
Let me start by describing the global economic weather map, as we see it. According to the
IMF’s spring forecast, the global economy will grow 3.5 percent this year – about the same
as last year – and 3.8 percent in 2016.
Advanced economies are doing slightly better than last year. In the US, the outlook still is for
a strong expansion – the weak first quarter was just a temporary setback. Prospects in the
Euro Area are improving, partly because of monetary easing by the European Central Bank.
And Japan seems to finally reap the first rewards of its “three arrows” recovery strategy
(monetary, fiscal, and structural).
2. Forecasts for most emerging and developing economies are slightly worse than last year,
mainly because commodity exporters are affected by price declines, especially for oil. And
recent data releases have reinforced this picture. But there is a tremendous diversity of
national trends – from still strong growth in India to recession in Brazil and Russia.
So the good news remains that the global recovery continues. But growth remains moderate
overall and uneven across countries.
What about the years beyond 2016, the second half of this decade? Well, here is where I
have to share some not-so-good news with you. Our view at the IMF is that the growth
potential of both advanced and emerging economies is likely to be lower in the years to
come. This is partly because of changing demographics and lower productivity. Our concern
is that this will bring more challenges in the labor markets, less-solid public finances, and
slower improvements in living standards.
This is the “new mediocre” about which I have been warning. For the “small boats”, it means
that the wind is picking up, but it is not strong enough to reduce high unemployment. It is
not strong enough to bolster middle-class incomes and drive poverty reduction. It is simply
not strong enough to lift the “small boats” – even as the yachts are enjoying the breeze out
on the high seas.
So, what is going on? Are we to resign in the face of unfavorable weather? Is there no hope
for the captains of the “small boats”, whether they are here in Belgium or anywhere in the
world?
2. Causes and Consequences of Excessive Inequality
The short answer is: there is hope, but to see it, we need to step back and look at the global
picture before we zoom in on the country level.
Imagine lining up the world’s population from the poorest to the richest, each standing
behind a pile of money that represents his or her annual income.
You will see that the world is a very unequal place. There is obviously a vast gulf between
the richest and the poorest. But if you look at the changes in this lineup over time, you will
notice that global income inequality – that is, inequality betweencountries – has
actually fallen steadily over the past few decades.
Why? Because average incomes in emerging market economies, such as China and India,
have risen much faster than those in richer countries. This shows the transformative power
of international trade and investment. The massive global flows of products, services,
people, knowledge, and ideas have been good for global equality of income – and we need
more of that. So we can further reduce the gap between countries.
But – and this is a big ‘but’ – we have also seen growing income inequality within countries.
Over the past two decades, inequality of income has risen substantially in most advanced
economies and major emerging market economies, especially in Asia and Eastern Europe.
In advancedeconomies, for example, the top 1 percent of the population now account for
about 10 percent of total income. And the gap between rich and poor is even wider when it
comes to wealth. Oxfam estimates that, in 2016, the combined wealth of the world’s richest
1 percent will overtake that of the other 99 percent of people. In the United States, a third of
total wealth is held by 1 percent of the population. Latin America has been a bright spot
with declining inequality levels – although it remains the world’s most unequal region.
If you put all this together, you see a striking divergence between a positive global trend and
mostly negative trendswithin countries.
China, for example, has been at the sharp end of both trends. By lifting more than 600
million people out of poverty over the past three decades, China has made a remarkable
contribution togreater global equality of income. But in the process, it has become one of the
world’s most unequal societies – because many rural areas remain poor and because income
and wealth have risen sharply in the cities and at the top levels of Chinese society.
In fact, economies like China and India seem to fit neatly into a traditional narrative which
says that extreme inequality is an acceptable price to pay for economic growth. Much like air
pollution, some may be tempted to say that inequality is simply part of the deal – get over
it!
New consensus
But there is a growing new consensus that countries should notaccept this Faustian tradeoff.
For example, analysis1
by my colleagues at the IMF has shown that excessive income
3. inequality actually drags down the economic growth rate and makes growth less sustainable
over time.
Earlier this week, we released our latest IMF analysis2
which provides the hard numbers for
my key message – that you need to lift the “small boats” to generate stronger and more
durable growth.
Our research shows that, if you lift the income share of the poor and middle class by1
percentage point, then GDP growthincreases by as much as 0.38 percentage points in a
country over five years. By contrast, if you lift the income share of the rich by 1 percentage
point, then GDP growth decreases by 0.08 percentage points. One possible explanation is
that the rich spend a lower fraction of their incomes, which could reduce aggregate demand
and undermine growth.
In other words, our findings suggest that – contrary to conventional wisdom – the benefits of
higher income are tricklingup, not down. This, of course, shows that the poor and the middle
class are the main engines of growth. Unfortunately, these engines have been stalling.
A recent OECD study, for example, shows that the living standards of the poor and lower
middle class in advanced economies have been falling relative to the rest of the population.
This kind of inequality holds back growth because it discourages investment in skills and
human capital – which leads to lower productivity in a large part of the economy.
Drivers of excessive inequality
So, the consequences of excessive income inequality are increasingly clear – but what about
its causes?
The most important drivers of extreme inequality are well known – technological progress
and financial globalization.3
These two factors have tended to widen the earnings gap
between higher- and lower-skilled individuals, especially in advanced economies.
Another factor is the overreliance on finance in major economies such as the United States
and Japan. Of course, finance – especially credit – is essential to any prosperous society. But
there is growing evidence, including from IMF staff4
, that too much finance can distort the
distribution of income, corrode the political process, and undermine economic stability and
growth.
In emerging and developing economies, extreme income inequality is largely driven by an
inequality of access – to education, health care, and financial services. Let me give you some
examples:
Almost 60 percent of the poorest youth population in sub-Sahara Africa has fewer than
4 years of schooling.
Nearly 70 percent of the poor in developing economies give birth without access to
doctors or nurses.
More than 80 percent of the poor in developing economies do not have bank accounts.
Of course, another major factor is low social mobility. Recent studies have shown that
advanced economies with lower levels of mobility across generations tend to have higher
levels of income inequality. In these countries, parents’ income is a major determinant of
children’s income. It suggests that, if you want to move up in society, you need to grow up
on the right side of the tracks. This doesn’t sound fair.
With these kinds of disadvantages – with this kind of inequality of opportunity – millions of
people have little or no chance of earning higher incomes and building up wealth. This is – in
the words of Pope Francis – an “economy of exclusion”.5
3. Policies for Stronger, More Inclusive, More Sustainable Growth
Policymakers can, in our view, generate a swell under the bow of the “small boats”. There
are recipes for stronger, more inclusive, and more sustainable growth in all countries.
The first priority – the number one item on the list – should be macroeconomic stability. If
you do not apply good monetary policies, if you indulge in fiscal indiscipline, if you allow your
public debt to balloon, you are bound to see slower growth, rising inequality, and greater
economic and financial instability.
Sound macroeconomic policies are the poor’s best friend – and so is good governance.
Endemic corruption, for example, can be a strong indicator of profound social and economic
inequality.
The second priority should be prudence. We all know that actions need to be taken to
reduce excessive inequality. But we also know that a certain level of inequality is healthy and
4. helpful. It provides incentives for people to compete, innovate, invest, and seize
opportunities – to upgrade their skills, start new businesses, and make things happen.
At their best, entrepreneurs have what economist John Maynard Keynes called “animal
spirits” – a sometimes boundless confidence in their own unique ability to shape the future.
In other words, standing out from the crowd is an essential driver of prosperity.
The next priority should be to adjust policies to country-specific drivers of inequality,
including political, cultural, and institutional settings. No more one-size-fits-all, but smart
policies – potential game changers – that could help reverse the trend towards greater
inequality.
Smart fiscal policy
One potential game changer is smart fiscal policy. The challenge here is to design tax and
spending measures that have minimal adverse effects on incentives to work, save, and
invest. The objective must be to promote both greater equality andgreater efficiency.
This means widening the tax revenue base by – for example – clamping down on tax
evasion; reducing tax relief on mortgage payments from which the rich benefit most 6
; and
reducing or removing tax relief on capital gains, stock options, and the profits of private
equity investments funds, known as “carried interest”.
In many European countries, it also means reducing high labor taxes, including through cuts
to employer social security contributions. This would provide a strong incentive to create
more jobs and more full-time positions – which would help stemthe tide of part-time and
temporary jobs that have contributed to rising income inequality.
On the expenditure side, it means expanding access to education and health care. In many
emerging and developing economies, it means reducing energy subsidies – which are costly
and inefficient – and using the freed-up resources for better education, training, and
stronger safety nets.
According to a recent IMF study, governments around the world will subsidize the cost of oil,
gas and coal to the tune of $5.3 trillion this year. This is the equivalent of what they spend
on public health each year.
Promoting greater equality and efficiency also means relying more on so-called conditional
cash transfers. These are immensely successful anti-poverty tools that have contributed
significantly to the reduction in income inequality in countries such as Brazil, Chile, and
Mexico.
During my recent visit to Brazil, I had the opportunity to visit afavela and witness first-hand
the so-called Bolsa Familiaprogram. This program provides aid to poor families – in the form
of pre-paid debit cards – on condition that their children go to school and take part in
government vaccination programs.
Bolsa Familia has proven to be both efficient and cost-effective: for expenditure of 0.5
percent of GDP per year, 50 million people are being supported – that’s one in every four
Brazilians.
Structural reforms
In addition to these smart fiscal policies, there is another potential game changer – smart
reforms in vital areas such as education, health care, labor markets, infrastructure, and
financial inclusion. These structural reforms are essential to lift potential economic growth
and boost income and living standards over the medium term.
If I had to pick the three most important structural tools to reduce excessive income
inequality, it would be education, education, education. Whether you live in Lima or Lagos,
in Shanghai or Chicago, in Brussels or Buenos Aires, your income potential depends on your
skills, your ability to harness technological change in a globalized world.
Higher incomes require higher human capital and policies that bring together more teachers
and students in 21st
-century class rooms, with better books and access to online resources.
Emerging and developing economies need to promote more equal access to basic education,
while advanced economies need to focus more on the quality and affordability of university
education. Even those countries with the highest educational standards should do more.
Another important tool is labor market reform. Think of well-calibrated minimum wages
and policies to support job search and skill matching. Think of reforms to protect workers
rather than jobs. In the Nordic countries, for example, workers have only limited job
protection, but they benefit from generous unemployment insurance that requires jobseekers
to find new positions. This model7
makes the labor market more flexible – which is good for
growth – while safeguarding the interests of workers.
5. Labor market reforms also have an important gender dimension. Across the globe, women
have been facing a triple-disadvantage. They are less likely than men to have a paid job,
especially in the Middle East and North Africa. If they do find paid employment, it is more
likely to be in the informal sector. And if they eventually get a job in the formal sector, they
earn just three-quarters as much as men – even with the same level of education, and in the
same occupation.
Countries like Chile and the Netherlands have shown that you can sharply increase female
labor force participation through smart policies that emphasize affordable childcare,
maternity leave, and workplace flexibility. You also need to remove legal barriers and tax
discrimination that continue to hold back women in many countries.
Worldwide, there are about 865 million women who have the potential to contribute more
fully to the economy. So the message is clear: if you care about greater shared prosperity,
you need to unleash the economic power of women.
You also need to foster greater financial inclusion, especially in developing economies.
Think of microcredit initiatives that turn poor people – mostly women – into successful
micro-entrepreneurs – as I could recently see in Peru. Think of initiatives to build credit
histories for people without bank accounts. Think of the transformative impact of cell-phone-
based banking, especially in Sub-Saharan Africa.
By improving their access to basic financial services, poor families in developing economies
can invest more in health and education, which leads to higher productivity and higher
income potential. If you want to reduce excessive income inequality in developing
economies, you need to increase financial equality.
Conclusion
All these policies and reforms require leadership, courage, and collaboration. This is why I
am calling on politicians, policymakers, business leaders, and all of us here to translate good
intentions into bold and lasting actions.
In particular, policymakers need to take advantage of what I think is a once-in-a generation
opportunity for development.
In September, the United Nations will host a major summit that will seek to replace the
Millennium Development Goals with a new set of Sustainable Development Goals. And a U.N.
conference next month will try to finance this ambitious new development agenda.
In December, leaders from196 countries will meet in Paris to seek agreement on a
comprehensive deal to cut carbon emissions. This deal would go a long way towards
protecting the interests of the poorest members of society who are the first victims of
climate change.
There are many cynical voices out there, questioning the need for action in these areas and
declaring defeat well before the battle has begun. We must be able to prove these cynics
wrong – by focusing minds, by forging partnerships, and by setting theright goals.
I sincerely hope that, by the end of this year, we will be able to look back and say, ‘we did
it’. “We re-energized global economic growth.’ ‘We reached a historic agreement on climate
change.’ ‘And we launched a brand new development agenda with ambitious goals and solid
financing.’
On all these issues, I see an important role for the IMF. Our key mandate is to promote
global economic and financial stability. This is why we have been deeply involved in
development – by helping our 188 member countries to design and implement policies and
by lending to countries in times of distress, so they can get back on their feet.
In Sub-Saharan Africa, for example, many countries have applied sound macroeconomic
policies over the past decade, and they are now reaping the benefits in the form of stronger
growth and higher living standards. The IMF has supported these efforts through new
instruments, such as zero-interest loans, as well as increased financing and capacity
building.
We are also stepping up our research on inequality, gender, and climate-related issues
because they are – as we say – macro-critical.
In addition, we are looking into how we might increase access to our loans for developing
countries to help them buffer external shocks. In particular, we will increase our focus on
helping the poorest and most fragile countries.
6. Consider the latest migrant tragedies in the Mediterranean and on Southeast Asian shores.
These cramped migrant boats represent the most fragile states and communities. They are
the smallest of the “small boats” – a powerful reminder of the most extreme inequality of
wealth and income. The economy of exclusion is staring us right in the face.
It is often said that we should measure the health of our society not at its apex, but at its
base. By lifting the “small boats” of the poor and the middle class, we can build a fairer
society and a stronger economy. Together, we can create greater shared prosperity – for all.
Thank you.
1
IMF note on Redistribution, Inequality, and Growth.
2
IMF note on the Causes and Consequences of Income Inequality.
3
These two factors feature prominently in the academic literature and public discussions
about inequality. The results of our latest note on the Causes and Consequences of Income
Inequality confirm the findings in the literature.
4
A recent IMF note on Rethinking Financial Deepening shows that, after a point, financial
development damages growth. An IMF Working Paper and a recent BIS paper argue that it is
possible to have too much finance.
5
Apostolic Exhortation by Pope Francis: “Just as the commandment ‘Thou shalt not kill’ sets
a clear limit in order to safeguard the value of human life, today we also have to say ‘thou
shalt not’ to an economy of exclusion and inequality.”
6
Half the rich world’s governments allow their citizens to deduct the interest payments on
mortgages from their taxable income
7
For more information on the Nordic model: IMF note on Labor Market Policies, IMF paper on
Jobs and Growth.