DW — Coronavirus latest: World has 'clearly' entered recession — IMF head

15:51 "It is clear that we have entered recession," said IMF head Kristalina Georgieva. Due to the pandemic, the global economy experienced a "sudden stop" and the fund is now looking for a practical approach to prevent indebted countries from "falling off the cliff."

15:23 The ongoing pandemic will have a deep economic impact and recovery could be only expected in 2021, said IMF chief Georgieva. This target can only be reached if the virus is contained and liquidity problems are not allowed to turn into issues with solvency, which is the ability to pay debts.

15:17 The world has entered a recession which is as bad or worse than the global financial crisis of 2008, the head of the International Monetary Fund (IMF) Kristalina Georgieva has said. 

The next leg down in the failure of neolibetralism.

Deutsche Welle
Coronavirus latest: World has 'clearly' entered recession — IMF head

Asymmetric Protectionism — Ramanan

Ha-Joon Chang.

The Case for Concerted Action
Asymmetric Protectionism
V. Ramanan

The 2020s are set to be an economic turning point, says global banking giant — Michael Janda

Merrill Lynch global forecast that puts a spotlight on MMT and sees a decline in neoliberal globalization resulting from rising nationalism and populism. Longish.

ABC (Australia)
The 2020s are set to be an economic turning point, says global banking giant

Michael Janda

RT ‘West’s leading role is ending’: G7’s no good without India and China, Putin says

Russian President Vladimir Putin has said the leading role of the West is coming to an end, and no serious international group makes much sense anymore without economic juggernauts like China and India.

Putin shared his thoughts on the Group of Seven (G7) during the Eastern Economic Forum, held outside Vladivostok in Russia’s Far East on Thursday. He was asked whether he would attend the group’s meeting in the US next year if invited. US President Donald Trump said last month he will “certainly” invite Putin.

The Russian president hinted that G7 leaders should instead travel to Russia where the last G8 event was due to take place, in 2014, prior to Moscow’s expulsion from the group....

RT
‘West’s leading role is ending’: G7’s no good without India and China, Putin says

Moon of Alabama — Moon of Alabama U.S. Decoupling From China Forces Others To Decouple From U.S.

The now not-so-hidden agenda is to take Chimerica apart, although I haven't seen it in the Western media yet, and this is decidedly not where American business and finance want to go.

Moon of Alabama
U.S. Decoupling From China Forces Others To Decouple From U.S.

Planetary Thinking — Eric Berglöf

As policymakers, academics, and activists prepare for next month's United Nations climate summit in New York, they should consider precisely what it will take to build a truly sustainable global economy. First and foremost, the world needs a new multidisciplinary approach that is broad enough to tackle the challenge....

Project Syndicate
Planetary Thinking

Eric Berglöf

Germany Stalls and Europe Craters — Alastair Crooke

But if Germany’s manufacturing woes were not sufficient in and of themselves, then combined with the threat of trade war with Trump, the prospect indeed is bleak for Europe: And the likelihood is that any of that ECB stimulus – promised for this autumn, as Mario Draghi warns that the European picture is getting “worse and worse” – will be very likely to meet with an angry response from Trump – castigated as blatant currency manipulation by the EU and its ECB. EU Relations with Washington seem set to sour (in more ways than one)....

Strategic Culture Foundation
Germany Stalls and Europe Craters
Alastair Crooke | founder and director of the Conflicts Forum, and former British diplomat and senior figure in British intelligence and in European Union diplomacy

See also

Armstrong Economics
Economic Storm Trump Will be Blamed For Because of Bad Advisers
Martin Armstrong

Trump’s China battle heads into the danger zone — Doug Palmer

“I think the expectation is that this is going to escalate and get worse rather than coming to a place of agreement or just going away,” said Putri Pascualy, managing director at investment firm PAAMCO Prisma. “The risk in the market is political and political risk for investors is very difficult to handicap.”….

Politico

Trump’s China battle heads into the danger zone

Doug Palmer

Joseph P. Joyce — The Change in the U.S. Direct Investment Position

The U.S. has long held an external balance sheet that is comprised of foreign equity assets, mainly in the form of direct investment (DI), and liabilities held abroad primarily in the form of debt, including U.S. Treasury securities. This composition is known “long equity, short debt.” Pierre-Olivier Gourinchas of UC-Berkeley and Hélène Rey of the London Business School claim that this allocation has allowed the U.S. to serve as the “world’s venture capitalist,” issuing short-term debt in order to invest in high-yield assets. But the U.S. direct investment position has changed from a surplus to a deficit, with uncertain consequences for the international monetary system.

There is more than one reason for the change....

Angry Bear
The Change in the U.S. Direct Investment Position

Joseph P. Joyce | Professor of Economics at Wellesley College, where he holds the M. Margaret Ball Chair of International Relations. He served as the first Faculty Director of the Madeleine Korbel Albright Institute for Global Affairs.

ECRI — Predicting the ISM and Markit PMIs

Is the trade war beginning to bite the global economy, to which most countries are coupled? A leading indicator suggests that this may be developing.

ECRI
Predicting the ISM and Markit PMIs

BRICS Now a Larger Share of World Economy Than G7 — Constantin Gurdgiev

Checkpoint Asia
BRICS Now a Larger Share of World Economy Than G7

Constantin Gurdgiev

Farewell, Flat World — Jean Pisani-Ferry

A new world is emerging, in which it will be much harder to separate economics from geopolitics. It’s not the world according to Myrdal, Frank, and Perroux, and it’s not Tom Friedman’s flat world, either. It’s the world according to Game of Thrones.

Naked Capitalism
Farewell, Flat World 

Jean Pisani-Ferry | Tommaso Padoa Schioppa chair of the European University Institute in Florence and is Senior Fellow at Bruegel. 

Cross-posted from Bruegel

Rabobank: Trump-Xi Meeting Is Not About Tariffs Or Trade, But Who Wins The Great Chess Game And How — Michael Every

More geopolitics and geostrategy, and how it impacts finance and economics.

The danger here is that POTUS and US hardliners see this as a zero-sum game. This greatly increases the chance that it will lead to kinetic warfare on a grander scale. The US is already deep into deploying economic, information, and cyberwarfare against a number of countries, and positioning for kinetic warfare.

The situation now is increasingly hair-trigger.

Zero Hedge
Rabobank: Trump-Xi Meeting Is Not About Tariffs Or Trade, But Who Wins The Great Chess Game And How
Michael Every | Head of Financial Markets Research Asia-Pacific, Rabobank

Disruption in the World of Trade — C. P. Chandrasekhar and Jayati Ghosh

World trade is in deceleration mode.

Real-World Economics Review Blog
Disruption in the World of Trade
C. P. Chandrasekhar and Jayati Ghosh
This article was originally published in the Business Line on June 3, 2019

Don Quijones — Global Foreign Direct Investment Flows Collapse

More and more companies either choose not to invest in other countries or are prevented from doing so.

Global foreign direct investment flows plunged by another 27% in 2018 — after having already plunged 16% in 2017 — to just $1.1 trillion, the equivalent of 1.3% of global GDP, the lowest ratio since 1999, according tonew data released by the OECD. It was the third consecutive annual plunge in global FDI flows, as more and more companies either choose not to invest in businesses or assets in other countries or are prevented from doing so.

At the peak in 2015, before the trade wars began, before the Brexit vote happened, and before China began cracking down on the capital outflows that had fueled big-ticket purchases of strategic companies across the globe as well as surging asset prices in multiple jurisdictions, global FDI flows totaled $1.92 trillion and represented around 2.5% of global GDP. FDI has since collapsed by 43%....

Globalization hits a speed bump.

Raging Bull-Shit
Global Foreign Direct Investment Flows Collapse
Don Quijones

Pepe Escobar — The EU bows to ‘systemic rival’ China

Slowly but surely, the EU is shifting its priorities to the East

Asia Times
The EU bows to ‘systemic rival’ China
Pepe Escobar

Alastair Crooke — The Dire, Unintended Consequences of Trump’s MAGA War on China

De-globalization and the collapse of the Post WWII world order. Sailing into uncharted territory.

Strategic Culture Foundation
The Dire, Unintended Consequences of Trump’s MAGA War on China

Alastair Crooke | founder and director of the Conflicts Forum, and former British diplomat and senior figure in British intelligence and in European Union diplomacy

See also

Consortium News
PATRICK LAWRENCE: Pompeo, Pence & the Alienation of Europe

Isabella Weber — What drives specialisation? A century of global export patterns

Globalisation has coincided with specialisation and wealth accumulation on unprecedented scales. By bringing together distant markets, globalisation has created an economy that resembles one big multi-division and multi-national company. This is just like Adam Smith’s concept of specialisation where the division of labour is at once the cause and the extent of the size of the market.

Patterns of production are therefore distributed unequally across countries and regions of the world. Some are predominantly the innovators and managers, some are the workshop of the world, and others simply provide the needed raw materials. This positioning in the global division of labour influences the extent to which countries participate in the creation of wealth from globalisation.

Our new research project funded by Rebuilding Macroeconomics looks at the question of what drives specialisation. Rather than rely on circular arguments around revealed comparative advantage, we reconceptualise export specialisation as a historical process drawing on commodity histories and histories of colonial economic governance. We revisit revealed comparative advantage as a descriptive measure to analyse the evolution of export patterns over time....

Sounds like mercantilism and hysteresis? Is the liberal world order a Trojan horse for neo-imperialism?

Political Economy Research Center
What drives specialisation? A century of global export patterns
Isabella Weber

Stanislav Tkachenko — G20: A Transition to Bipolarity?

Although the G20 still retains its potential to support the global economic stability, there is an impression that its mission is coming to an end. If this trend is not reversed, then, a summit or two from now, we might see the return of trade wars and competitive devaluations of national currencies. In that case, the current G20 format, built around the US leadership and hegemonic in nature, will not work at all. The nature of the G20 is that of an international forum, not an international intergovernmental organization.;;;

Valdai
G20: A Transition to Bipolarity?

Stanislav Tkachenko, Visiting Professor at the Research Center for the Economies and Politics of Transitional Countries, Liaoning University

Hites Ahir, Nicholas Bloom, Davide Furceri — Global uncertainty is rising, and that is a bad omen for growth

The global economy is growing, but so is uncertainty. This column presents a new quarterly index of uncertainty for 143 countries. The World Uncertainty Index reveals how uncertainty in the world has evolved over time, whether it is synchronised across countries, and how it compares across income groups and political regimes.

Voxeu
Global uncertainty is rising, and that is a bad omen for growth
Hites Ahir, Senior Research Officer, IMF; Nicholas Bloom, Professor of Economics at Stanford University, and Davide Furceri, Senior Economist in the Research Department, IMF