Sources: Maps Of The World, Bloomberg, Riksbank, Barclays
 Photo: Today As TODAY reports, Singapore retained its status for a 10th consecutive year as the easiest country in which to do business, while emerging markets such as China and India moved up the rankings, according to the World Bank.
The World Bank’s annual Doing Business report ranks 189 countries based on 11 indicators such as the ease of starting a business, dealing with construction permits, getting electricity and obtaining credit. The 30 best performers stand out because they have rules that allow “efficient and transparent functioning of businesses and markets”, not because they have little regulation, the Washington-based development lender said in the latest report. Contributing to Singapore’s high scores was its “high-quality judicial processes”. “Resolving a commercial dispute through the Singapore District Court takes just 150 days, the shortest time recorded worldwide, and costs 25.8 per cent of the value of the claim. Efficient dispute resolution is paired with good institutions (such as specialised courts), effective case management and sophisticated court automation tools,” the report said. ... Waiting for Godot is a play written by the Irish novelist Samuel B. Beckett in the late 1940s in which two characters, Vladimir and Estragon, keep waiting endlessly and in vain for the coming of someone named Godot. The storyline bears some resemblance to the Federal Reserve’s talk about raising interest rates.
As the Mises Institute reports, since spring 2013, the Fed has been playing with the idea of raising rates, which it had suppressed to basically zero percent in December 2008. So far, however, it has not taken any action. If savers and investors expect that interest rates will remain at rock bottom forever, they would presumably turn their backs on the credit market. The ensuing decline in the supply of credit would spell trouble for the fiat money system. To prevent this from happening, the Fed must achieve two things: First, it needs to uphold the expectation in financial markets that current low interest rates will be increased again at some point in the future. If savers and investors buy this story, they will hold onto their bank deposits, money market funds, bonds, and other fixed income products despite minuscule yields. Second, the Fed must succeed in continuing to postpone rate hikes into the future without breaking peoples’ expectation that rates will rise at some point. It has to send out the message that rates will be increased at, say, the forthcoming FOMC meeting. But, as the meeting approaches, the Fed would have to repeat its trickery, pushing the possible date for a rate hike still further out. If a rush for the credit market exit would set in, it would be upon the Fed to fill debtors’ funding gap in order to prevent the fiat system from collapsing. The central bank would have to monetize outstanding and newly originated debt on a grand scale, sending downward the purchasing power of the US dollar .. and with it many other fiat currencies around the world. ... As Zerohedge reports, Bitcoin has recovered all the losses from the volatility surrounding China's currency devaluation and Black Monday equity weakness as implicit capital controls drive the Chinese into alternative currencies (as we warned would happen).
However, the last few days have seen the cryptocurrency surge to $280 - the highest in 12 weeks - as The EU's top court ruled bitcoin and other virtual currencies can be exchanged tax-free, putting them on a more equal footing with traditional cash. ...  Source: Zero Hedge As crazy as it sounds, the Saudis are going broke.
Of course you wouldn’t know it if you read the account of King Salman’s latest visit to Washington which included booking the entire DC Four Seasons and procuring a veritable fleet of Mercedes S-Class sedans. You’d also be inclined to think that everything is fine if you simply looked at SAMA holdings (i.e. FX reserves) which still total nearly $700 billion (see chart above). The problem however, is the outlook: fighting wars costs money and so does bribing the citizenry to ensure you don’t get some kind of Arab Spring-type uprising. When you endeavor to artificially suppress the price of the export that is the source for your wealth and international prestige (all in an epic attempt to bankrupt the competition and secure geopolitical “ancillary benefits”) you don’t do yourself any favors from a financial perspective and now, the Saudis are staring down a massive budget deficit and a current account that’s in the red for the first time in ages. On Wednesday, the IMF is out with a new report on the economic outlook for the Mid-East and the picture for the Saudis is not pretty. In short, Riyadh will burn through its cushion in less than 5 years under current conditions. ...  As Xinhuanet reports, the Bank of China announced on Tuesday the establishment of the Trading Centre (London), and launched BOC RMB Bond Trading Index with ceremonies simultaneously held in London, Beijing and Singapore.
The founding of Bank of China Trading Centre (London) is an important step in accordance with the BOC Group's "Global Operation with integrated management" strategy. The trading centre will provide its clients greater coverage in foreign exchange, derivatives, commodities and fixed income trading. This centre would be the Group's second largest offshore trading centre after Hong Kong, reinforcing the Group's global business network. ...  Source: Xinhua As Xinhuanet reports, China and Thailand agreed to speed up cooperation on a joint railway project, in an effort to ensure an early start within the year.
During Li's Thai visit last December, he signed a memorandum of understanding (MoU) with Prime Minister Prayuth Chan-ocha to jointly develop a medium-speed railway connecting northeast Thailand's Nong Khai province, the capital of Bangkok and eastern Rayong province. The railway will also be a section of the planned railway running through southern China, Laos and Thailand. "The railway will promote the two countries' economic development and facilitate trade cooperation and people-to-people exchanges between China, Thailand and the Indo-China Peninsula," Li noted. He also voiced support for China's Belt and Road initiative and agreed to promote bilateral cooperation within the framework in the spirit of open and transparent. According to Wang, the two countries also agreed to start a Lantsang-Mekong cooperation mechanism aimed to help countries along the river realize common development through complementary cooperation. Pramudwinai said Thailand was willing to strengthen cooperation on water resources, drought control and disaster relief under the framework of the Lantsang-Mekong cooperation mechanism. They also discussed relations between China and the Association of Southeast Asian Nations (ASEAN).  CLICK or TOUCH! - Source: Visual Capitalist As Ecns reports, the Industrial and Commercial Bank of China (ICBC) Singapore completed its first clearing of 35 million yuan via the Cross-border Interbank Payment System (CIPS) on Thursday as a major step to internationalize its currency.
The transaction, which was a trade settlement payment from Singapore's Raffemet Pte Ltd to Baosteel Resources in Shanghai, marked the first in Asia to be cleared through the newly-launched system. The CIPS system was developed and administered by China's central bank. It enables market participants outside China to clear yuan transactions with their Chinese counterparts directly from during any working day under a coding format in line with international practice. The CIPS will process a broad range of cross-border RMB transactions, including settlement of RMB trade and capital projects, as well as settlement of remittance transactions, ICBC Singapore said. "The launch of CIPS represents a turning point in the internationalisation of the yuan. As the yuan continues to rise as a popular choice among world payment currencies, CIPS will accelerate global use of the currency, with the extended operational hours and greater efficiency," said Zhang Weiwu, General Manager of ICBC Singapore. ...  As Zerohedge reports, the picture that emerges is one in which China has managed to convince Russia to settle oil imports in renminbi and in which the AIIB and Silk Road funds are set to help establish the yuan as the funding currency for billions in development projects.
While we may still be years away from the fabled “yuan hegemony,” we got still more evidence on Tuesday that despite the currency’s rather uncertain medium-term trajectory and despite a still closed capital account, China is moving ever closer to establishing the RMB as a reserve currency. In August, for the first time, the yuan moved ahead of Japan’s yen for fourth place in a league table of the most-used currencies for cross-border payments compiled by Swift, the international payments provider. ... |
