UN Report Says Billions Face Food, Energy, Finance Crises Due To Ukraine War

United Nations Secretary-General Antonio Guterres speaks to the media regarding Russia's invasion of Ukraine, at the United Nations Headquarters in New York City, on Mar 14, 2022. (Photo: REUTERS/Andrew Kelly)  

CNBC: Russia’s war in Ukraine threatens to hurt billions, UN warns, as food and energy prices soar 

* Russia’s war in Ukraine is already taking a dramatic toll on the world economy, causing disruptions to global food, energy and financial markets, the United Nations said. 

* The “perfect storm,” which comes amid already-brewing crises related to the Covid pandemic and climate change, “threatens to negatively affect the lives of billions of people around the world,” the UN said. 

* U.S. Treasury Secretary Janet Yellen said earlier that her department will be turning its attention to the risk of an increase in global starvation rates. 

Russia’s war in Ukraine is already taking a dramatic toll on the world economy and placing a huge swath of the world’s population, especially those in developing nations, at an increased risk of harm, the United Nations warned Wednesday. 

The crisis has caused a “perfect storm” of disruptions to global food, energy and financial markets that “threatens to negatively affect the lives of billions of people around the world,” the UN said in a new report. 

Those systems were already under immense strain due to the ongoing coronavirus pandemic, as well as climate change and other historic challenges, the report said.  

Read more ....  

WNU Editor: The UN report is here .... Global Impact of war in Ukraine on food, energy and finance systems (United Nations).  

UN Report Says Billions Face Food, Energy, Finance Crises Due To Ukraine War  

Ukraine war unleashing a 'perfect storm' of crises, warns UN chief -- UN News  

UN says Ukraine war threatens to devastate many poor nations -- AP  

Poor countries face food, energy, finance crises due to Ukraine war, UN chief says -- Reuters  

Ukraine war is a 'perfect storm,' threatening food, energy, and debt crises across the globe: UN report -- FOX News  

UN: War in Ukraine "supercharging" global crises -- Axios

Is The World Facing A "Lehman Style Crisis" This Week?

Zero Hedge: Pozsar Warns Of Another "Lehman Weekend" As Russia Sanctions May Trigger Central Bank Liquidity Flood 

In a remarkable show of force and unity, western powers cast aside all their previous concerns about Russian energy export dominance, and uniliaterally announced the nuclear option of imposing sanctions on the Russian central bank coupled with targeted exclusions from SWIFT of key Russian banks. 

*EU APPROVES BANNING ALL TRANSACTIONS WITH RUSSIAN CENTRAL BANK 

The move has sparked a bank run in Russia, as locals scramble to pull out whatever hard currency they can get their hands on before it runs out, and is certain to trigger chaotic moves in FX and commodities when markets reopen on Monday. Already some Russian banks are offering to exchange rubles for dollars at a rate of 171 rubles per dollar on Sunday, compared to the official closing price of 83 on Friday before the European/US announcement about targeting the Russian central bank. In other words we are looking at a 50%+ devaluation of the Ruble. Additionally, widespread announcements of divestments in Russian equities by the likes of BP pls and the Norwegian sovereign wealth fund mean that the Russian market will be a bloodbath on Monday.  

Read more ....  

WNU Editor: Russia is definitely going to experience a 'Lehman moment' this week. Which is incredible in view of the fact that Russia has no government debt, huge trade surpluses, massive gold reserves, and hundreds of billions in foreign currencies. 

As for everyone else. 

I do not see a 'Lehman' moment. And while the everything bubble that the world has been living through for the past decade will continue, be warned that all good things will one day end.

U.S. Report: 60% Of Small Businesses That Closed During The Pandemic Have Now Shut Their Doors Permanently

A person wearing a protective mask stands by a going out of business sign displayed outside a retail on Sunday in New York City. Permanent business closures are rising, new data shows

Daily Mail: Yelp data shows 60% of small businesses that closed during the pandemic have now shut their doors permanently and 97,966 firms in total have closed for good - with restaurants and bars among the hardest hit

* New data from Yelp shows rise in permanent closures in pandemic lockdowns
* Since March, 97,966 businesses across the country have permanently closed
* That is 60% of the 163,735 total U.S. businesses on Yelp have closed since March
* Restaurants are the hardest hit category, followed by bars and nightlife
* Professional services and tradesmen have seen the lowest closure impact
* Closure rates are higher in large cities with high rent and strict requirements

New data released by Yelp has suggested that a staggering 60 percent of businesses that were forced to shut down temporarily in the coronavirus pandemic have now closed their doors permanently.

As of August 31, 163,735 total U.S. businesses on Yelp had closed since the pandemic began in March, with 97,966 of those going on to shutter permanently, according to a report from the company.

Despite the lifting of the harshest lockdown measures in most areas, the pandemic continues to take a steep economic toll, with capacity limits and lower demand driving many small companies out of business, the data shows.

Restaurants have been among the hardest hit businesses, with 19,590 closing permanently since the pandemic began.

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WNU Editor: The U.S. is not the only country that is facing economic hard times .... Downtown Montreal sees an over 90 per cent decrease in people heading to work (CTV News). I live in Montreal, and it is surreal to see the store/restaurant closures and the empty streets. This reminds me of Russia after the Soviet Union collapsed. There was no work, and the government did not have the means to help the average citizen. People survived by relying on family and friends. It took about a decade for Russia to crawl out of that mess. Is this the future for countries like the U.S., Canada, and others? Are we all facing not a Great Depression, but a Greater Depression? You tell me.

Russian President Putin Warns Of A Financial Crisis That The World ‘Has Not Yet Seen’

Daily Mail: Putin says the US could cause a global economic crisis because of Trump's trade wars and new era of 'protectionism'

* The Russian president was speaking at an economic summit in St Petersburg
* Also attending was Emmanuel Macron and Japan's Prime Minister Shinzo Abe
* Putin said new era of protectionism was emerging, threatening global prosperity
* The French leader said he had a duty to keep working with the U.S. president

Russian President Vladimir Putin warned that the world could be heading for an unprecedented economic as a result of Donald Trump's trade policies.

Without directly naming the US President, who has slapped on tariffs and pulled out of trade deals, Putin lamented that a new era of protectionism was emerging and 'breaking' the free trade system responsible for global prosperity.

'Today we need not trade wars or even trade truces, but trade peace,' Putin told an economic summit in Saint Petersburg, also attended by Japan's Prime Minister Shinzo Abe and French President Emmanuel Macron.

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Update: Putin warns of financial crisis the world ‘has not yet seen’ (RT)

WNU Editor: When it comes to international crisis .... trade wars and protectionism .... coupled with the debt crisis .... are my number one worries. Wars are number two.

Are We On The Precipice Of A Great Depression?

Encyclopaedia Britannica

John Coumarianos, Marketwatch: Chilling ways the global economy echoes 1930s Great Depression era

Protectionism, shaky debt, and weak banking systems have consequences

One view of what caused the Great Depression in the 1930s is that the Federal Reserve failed to prevent a collapse in the money supply.

This is the famous thesis of Milton Friedman’s and Anna Schwartz’s A Monetary History of the United States, 1867-1960, and it was, more or less, the view of Ben Bernanke when he was chairman of the Federal Reserve.

The global economy today resembles that of the 1930s in several ominous ways.

Financial author Edward Chancellor recently called attention to a paper written by Caludio Borio, head economist at the Bank of International Settlements, that provides a fuller picture of the causes of the Great Depression. The paper also draws parallels between global economic conditions that led to the rise of protectionism in the 1930s and our situation now.

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WNU Editor: In 1992 the Russian economy collapse .... and it had all the hallmarks of the U.S. Great Depression of the 1930s. Mass unemployment, homelessness, no money, no social safety net,  .... I saw and experienced it all ... and I vowed to never have that happen to me and to my family again. Flash forward to today .... and trust me on this one .... there are too many similarities between that time and today. I pray and hope that I will never see it again .... an economic crash that destroys wealth and a society's sense of well being .... but we are "creatures of habit" who have a nasty habit of repeating history .... and I am seeing history repeat itself..

The 10 Largest Global Economies Are All Crashing

Zero Hedge: The Stock Markets Of The 10 Largest Global Economies Are All Crashing

You would think that the simultaneous crashing of all of the largest stock markets around the world would be very big news. But so far the mainstream media in the United States is treating it like it isn’t really a big deal.

Over the last sixty days, we have witnessed the most significant global stock market decline since the fall of 2008, and yet most people still seem to think that this is just a temporary “bump in the road” and that the bull market will soon resume. Hopefully they are right.

When the Dow Jones Industrial Average plummeted 777 points on September 29th, 2008 everyone freaked out and rightly so. But a stock market crash doesn’t have to be limited to a single day. Since the peak of the market earlier this year, the Dow is down almost three times as much as that 777 point crash back in 2008. Over the last sixty days, we have seen the 8th largest single day stock market crash in U.S. history on a point basis and the 10th largest single day stock market crash in U.S. history on a point basis. You would think that this would be enough to wake people up, but most Americans still don’t seem very alarmed. And of course what has happened to U.S. stocks so far is quite mild compared to what has been going on in the rest of the world.

WNU Editor: Maybe now is the time to buy? :)

There Is No Financial Safe Haven In The World Today

Lisa Abramowicz, Bloomberg: Good Luck Finding a Place to Hide as Global Markets Crumble

Investors tend to respond to impending doom by selling risky stuff and hiding out in safer assets -- namely, bonds in places such as Germany and the U.S.

There’s a problem with that formula this time around: Traders aren’t so sure they can find anything that’s truly safe right now. So, instead of piling into sovereign debt of developed nations, traders are pulling their money out of those places as the Greek economy teeters on the brink of collapse, Puerto Rico talks about delaying some debt payments and China’s stock market suffers its biggest selloff since 1992.

Investors yanked $2.9 billion from European government bond funds last week, more than ever before, and pulled $699 million from short-term investment-grade U.S. bond funds, Bank of America Corp. and Wells Fargo & Co. data show. While these assets have traditionally been havens during rocky periods, they look less appealing now after more than six years of unprecedented monetary stimulus that pushed yields to record lows.

WNU Editor: There is always risk when it comes to how protecting/investing your money .... but I have never seen the world's financial situation as it is today .... and I have lived through my fair share of financial crashes/crisis/and collapses.

The World Is Not Ready For The Next Financial - Economic Crisis

(Click on Image to Enlarge)

The Economist: The world economy: Watch out

It is only a matter of time before the next recession strikes. The rich world is not ready

THE struggle has been long and arduous. But gazing across the battered economies of the rich world it is time to declare that the fight against financial chaos and deflation is won. In 2015, the IMF says, for the first time since 2007 every advanced economy will expand. Rich-world growth should exceed 2% for the first time since 2010 and America’s central bank is likely to raise its rock-bottom interest rates.

However, the global economy still faces all manner of hazards, from the Greek debt saga to China’s shaky markets. Few economies have ever gone as long as a decade without tipping into recession—America’s started growing in 2009. Sod’s law decrees that, sooner or later, policymakers will face another downturn. The danger is that, having used up their arsenal, governments and central banks will not have the ammunition to fight the next recession. Paradoxically, reducing that risk requires a willingness to keep policy looser for longer today.

WNU Editor: Why this economics post? Economic crisis tend to bring about wars and conflicts 12 - 18 months later. The bigger the crisis .... the bigger the conflict. That is why these times are very troubling .... we are not talking about a minor correction or a short term recession .... we are talking about events that may have the capacity to overwhelm the system. The consequences of such a development .... I shudder when I think about it.

18 Signs That The Global Economic Crisis Is About To Get Worse

18 Signs That The Global Economic Crisis Is Accelerating As We Enter H2 2014 -- Zero Hedge

Submitted by Michael Snyder of The Economic Collapse blog,

A lot of people that I talk to these days want to know "when things are going to start happening".  Well, there are certainly some perilous times on the horizon, but all you have to do is open up your eyes and look to see the global economic crisis unfolding.  As you will see below, even central bankers are issuing frightening warnings about "dangerous new asset bubbles" and even the World Bank is declaring that "now is the time to prepare" for the next crisis.  Most Americans tend to only care about what is happening in the United States, but the truth is that serious economic trouble is erupting in South America, all across Europe and in Asian powerhouses such as China and Japan.  And the endless conflicts in the Middle East could erupt into a major regional war at just about any time.  We live in a world that is becoming increasingly unstable, and people need to understand that the period of relative stability that we are enjoying right now is extremely vulnerable and will not last long.

The following are 18 signs that the global economic crisis is accelerating as we enter the last half of 2014...

Read more ....

My Comment: Only 18 signs? Number 19 is this one. :)

US Federal Reserve Has Told Asia, Latin America, Africa And Eastern Europe To Drop Dead

Emerging Market Rout Is Too Big For The Fed To Ignore -- Ambrose Evans-Pritchard, The Telegraph

The US Federal Reserve has told Asia, Latin America, Africa and Eastern Europe to drop dead.

This has the makings of a grave policy error: a repeat of the dramatic events in the autumn of 1998 at best; a full-blown debacle and a slide into a second leg of the Long Slump at worst.

Emerging markets are now big enough to drag down the global economy. As Indonesia, India, Ukraine, Brazil, Turkey, Venezuela, South Africa, Russia, Thailand and Kazakhstan try to shore up their currencies, the effect is ricocheting back into the advanced world in higher borrowing costs. Even China felt compelled to sell $20bn of US Treasuries in July.

"They are running down reserves by selling US and European bonds, leading to a self-reinforcing feedback loop," said Simon Derrick from BNY Mellon.

We are told that emerging markets are more resilient than in past crises because they have $9 trillion of reserves. But any use of that treasure to defend the exchange rate entails monetary tightening, and therefore inflicts a contractionary shock on countries already in trouble.

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My Comment: These economic shocks are beginning to have an impact .... even the Chinese are worried (and threatening).

How Yesterday's U.S. Elections Will Impact The Economy, Sequestration, And The Approaching 'Fiscal Cliff'

Election Over, Obama Faces Fresh Challenge With 'Fiscal Cliff' -- Reuters

* Pending tax increases, spending cuts pose problem
* Fate of global markets, economy at stake

WASHINGTON, Nov 7 (Reuters) - Barack Obama won re-election on Tuesday night, but the U.S. president faces a fresh challenge confronting the "fiscal cliff," a mix of tax increases and spending cuts due to extract some $600 billion from the economy barring a deal with Congress.

At stake are two separate issues - individual tax cuts due to expire at year's end and tens of billions of dollars in across-the-board federal spending cuts due to kick in the day after New Year's Day.

Failure to prevent a dive off the cliff could rattle U.S. markets, and push the U.S. economy into a recession, which could have global implications. How Obama fares with a familiar set of challenges - most notably a Republican-controlled House of Representatives - could color his second term.

Read more ....

More News On How Yesterday's U.S. Elections Will Impact The Economy, Sequestration, And The Approaching 'Fiscal Cliff'

Obama win has U.S. investors staring at fiscal cliff -- Chicago Tribune/Reuters
Up next: the fiscal cliff -- Politico
Now the real battle begins: ‘fiscal cliff’ looms for Obama with Congress deadlocked -- The Independent
Obama back at the wheel as US economy heads for a fiscal cliff -- The Guardian
Economists' advice for Obama: Avoid 'fiscal cliff' -- CBS/AP
U.S. fiscal cliff risks dragging global economy into darkness -- Uri Dadush, Special to CNN
Fiscal Future, Thy Name is Sequester -- Tim Ferguson, Forbes

My Comment: One advantage that President Obama has is that many who voted yesterday still blame President Bush for the bad economy. But .... hard decisions will still need to be made, and I am very pessimistic that they will be done. Throw in Obamacare taxes and other tax increases in the new year .... Bill Gross is right with this prediction.

Update: Oh ... oh .... this is not a good sign that compromises will be reached.

Libya's Transitional Prime Minister Knows Who Can Shed Light On The Murder Of PC Yvonne Fletcher

PC Fletcher lies fatally wounded outside the Libyan Embassy

Libya's Exiled Former Intelligence 'Knows Who Killed WPc Yvonne Fletcher' -- The Telegraph

Libya's exiled former intelligence chief knows the identity of PC Yvonne Fletcher's killer and was probably involved in her murder, the country's transitional prime minister said.

Abdurrahim El-Keib said he was convinced that Abdul Senussi, who has fled to Mauritania, could name the person who shot Pc Fletcher during a siege outside the Libyan embassy in London in 1984.

After laying a wreath of white roses and carnations at a memorial commemorating her death, Mr Keib said in an interview with the Guardian that Mr Senussi was the "black box" to solving the case.

He said Senussi was "directly or indirectly involved in most if not all of the crimes" of the Gaddafi regime.

Read more ....

My Comment: The truth will come out one day .... and justice will be imposed .... the only question that needs to be answered is when.

The Start Of "Late Great Depression"?

Robert Shiller - World Economic Forum Annual Meeting 2012 (Wikipedia)

We Are In Age Of ‘Late Great Depression’: Shiller -- CNBC

The world is in a state of “late Great Depression,” well-known economist and author Robert Shiller told CNBC Monday.

The Yale economics professor, who helped devise the Case-Shiller index for housing market trends, and famously called the dotcom bubble of the early 2000s and the housing market bubble later in the decade, told “Squawk Box Europe” that the world is in a “new age of austerity.”

“Our whole economy has been affected by variations in confidence. Central banks are sort of trusted, but the actions they have often affect people’s confidence by appearance rather than substance. We’re not in the most trusting mood now,” Shiller said.

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My Comment: He has a track record of being right .... and he is probably right on this prediction.

The Doom And Gloom Economic Pundits Are Predicting War Between Iran And Israel

Dr. Doom’ Sees Iran-Israel Clash, Says Buy Precious Metals -- CNBC

Political risk in the Middle East has increased significantly with war between Iran and Israel almost inevitable, and precious metals and equities investments offer some safety, Swiss money manager and long-term bear Marc Faber said on Tuesday.

"Political risk was high six months ago and is higher now. I think sooner or later, the U.S. or Israel will strike Iran—it's almost inevitable," Faber, who publishes the widely read Gloom Boom and Doom Report, told Reuters on the sidelines of an investment conference.

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My Comment: I always worry about these pundits .... they always put their money where their mouth is .... and they are usually right. But while I do not share their conviction that there will be an Israeli strike on Iran, they will probably still make money because of this monster crisis which has the capacity of becoming a real disaster that will impact everyone.

Get Ready For The Economic Apocalypse (Maybe)

'Plan For An Economic 9/11': Analysts Warn Americans To Buy Guns And Gold, Predicting Market Crash And Street Riots Within A Year -- Daily Mail

* Gerald Celente, Harry Dent and Robert Prechter all predicting big trouble
* Markets and unemployment figures posting best showings in four years
* But analysts say Americans will riot when another Great Depression hits

Just when you thought unemployment was dropping and stock markets were surging back, these three analysts today sent out a stark warning to Americans to brace for another financial crash.

Trend forecaster Gerald Celente advises buying a gun to protect your family, stocking up on gold if the dollar crashes and planning a getaway, so it’s no shock he’s preparing for an ‘economic 9/11’.

Share prices and unemployment are posting their best figures in four years since the recession hit, but Mr Celente, along with authors Harry Dent and Robert Prechter, says the rebound won’t last.

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My Comment: A part of me scoffs at the idea of an economic crash .... that the U.S. economy is still vibrant and strong and we will eventually overcome our economic problems. But .... another part of me reminds me that I was in Russia in 1992 when they experienced their "economic apocalypse", and to sum it up bluntly .... I never expected it but when it happened it devastated everyone. So ..... can the same happen in the U.S. .... sadly I will have to say yes. When will that happen .... I do not know. But like Russia in 1992 .... it will occur over a few months, and before anyone knows it, they will be out of work and out of money very quickly.

24 Stats That Illustrate The Decline Of America As A Super Power

24 Stats To Crush Anyone Who Thinks America Has A Bright Economic Future -- Business Insider

Beware of bubbles of false hope. Right now there is a lot of talk about how the U.S. economy is improving, but it is all a lie. The mainstream media can be very seductive. When you sit down to watch television your brain tends to go into a very relaxed mode. In such a state, it becomes easy to slip thoughts and ideas past your defenses. Sometimes when I am watching television I realize what the media is trying to do and yet I can still feel it happening to me.

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My Comment: These stats are startling, with #8 and #24 being the most numbing of the 24.

The World Economy Is Heading Towards A Black Hole

The World Economy: Be Afraid -- Economist

Unless politicians act more boldly, the world economy will keep heading towards a black hole.

IN DARK days, people naturally seek glimmers of hope. So it was that financial markets, long battered by the ever-worsening euro crisis, rallied early this week amid speculation that Europe’s leaders had been bullied by the rest of the world into at last putting together a “big plan” to save the single currency. Investors ventured out from safe-haven bonds into riskier assets. Stock prices jumped: those of embattled French banks soared by almost 20% in just two days.

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My Comment: A sobering assessment on where we are. Read it all.

Europe's Staggering Youth Unemployment Numbers

Europe's Angry Youth: Flash Points Across the Continent -- Spiegel Online

Violent riots like those that raged through London and Britain this week have rung the alarm bell for politicians. Frustration is also high among young people in other nations across Europe. As the gap between rich and poor widens, the next outbreak could happen in a number of countries.

For four days earlier this week, young people in Britain rioted, marauding through the streets of England's big cities. Prime Minister David Cameron called off his summer holiday in Tuscany to deal with the situation, and members of parliament were recalled from their recess.

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My Comment: The unemployment stats from Spain and Greece are astounding, but with no place to work and/or numerous obstacles to open your business .... this sense of dissatisfaction and rebellion can quickly evolve into the sense of despair and frustration that is felt across the Mediterranean in the Arab world that resulted in the 'Arab Spring'.

Update: Established Democracies Face a Summer of Despair -- New York Times/AP

Is The U.S. FED Responsibile For The Arab Spring Uprisings?

Graph 1. Source: IMF food price index, Bloomberg, Europe Economics

How The Fed Triggered The Arab Spring Uprisings In Two Easy Graphs -- The Telegraph

It is possible to join the dots between the Fed’s second phase of quantitative easing and the revolutions in the Middle East.

One curious aspect of recent events in the Middle East and North Africa is how unwilling most commentators have been to join the dots between the Federal Reserve’s second phase of quantitative easing and these revolutions. I’m less queasy. Of course, all revolutions have many causes, and I don’t mean to belittle the achievements of brave non-violent protesters, desperate self-immolators, or saloon-car rifle-wielders. But, as a trigger and driver of these events, the Fed seems very clearly to have achieved more in the Arab world in six months than the Pentagon achieved in decades.

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My Comment: The last two paragraphs in this report sums up nicely why much of the Arab world is in turmoil ....

.... When food prices rises faster, revolutions become more likely. And in a number of Arab states, food prices are already higher (and more exposed to international commodity price rises) than other states ....

.... The case is clear and simple, but nonetheless powerful for that. QE2 drove up food prices, as we ought to have expected. Rapid food prices rises led to revolutions, as we ought to have expected ....

Indeed.

Fears Of Inflation Are Mounting Around The Globe

Global Price Fears Mount -- Wall Street Journal

As Food, Raw Materials Soar, Europe's Central Bank Head Warns on Inflation

Inflation fears—fueled by spiraling food, oil and raw material prices—are mounting around the globe, prompting the head of the European Central Bank to signal that it could raise interest rates in the future even though some countries have been weakened by the Continent's debt crisis.

In an interview with The Wall Street Journal ahead of this week's annual meeting of the World Economic Forum in Davos, Switzerland, Jean-Claude Trichet warned that inflation pressures in the euro zone must be watched closely, and urged central bankers everywhere to ensure that higher energy and food prices don't gain a foothold in the global economy.

Read more ....

My Comment: I lived during the inflation period of the late 1970s and early 1980s .... and in Russia when the Soviet Union broke up in the early 1990s .... it is not pretty.

Expect more unrest (like in Tunisia) to hit a large number of countries when this inflationary cycle .... which is coming .... hits us this year and/or next.