Keith Wade (Schroders) | Clearly, Japan’s debt is significantly higher than the US’. However, it is stable rather than rising. This reflects the poor position of US government finances before Covid-19, where the budget deficit was running at 6.3% of GDP at a time when the economy was doing well with unemployment at less than 4%, a 50-year low. (In net terms the comparison is less stark with Japan at 180% GDP versus 114% in the US).
The European Commission is concerned about the management of NPLs after the impact of the pandemic and the economic slowdown in the Q4. However, Brussels is reluctant to create a bad bank, mainly because of the high costs of creating a European agency to manage these assets. Instead, the EC proposes to reform the insolvency and debt recovery regime, with the aim of unifying legislation at European level. At the same time, making it easier for banks to get rid of doubtful assets on their balance sheets.
The new strain of coronavirus which has emerged in the UK has led to a long list of countries freezing air traffic with the island, including Spain. In fact from today, only Spanish residents and citizens will be able to return home from the UK. The measure, which has been taken in coordination with Portugal, will mean the cancellation of around 200 daily flights. This will be particularly prejudicial for the Canary Islands, where 1 out of every 2 tourists is British.
The cable will connect the US to Spain and the UK once completed in 2022. This new expanded collaboration between Telxius and Google will allow Google to connect the new cable to the Telxius Cable Landing Station (CLS) in Sopelana, Spain, and leverage the rich interconnection and advanced transmission capabilities of the nearby Derio Communications Hub.
The positive trend in the euro area trade balance increased in October by 10.3% year-on-year, reaching 30 billion euros, according to data on international trade in goods published by Eurostat. By items, exports of goods from the euro area to the rest of the world contracted by 9%, to 199.3 billion euros. The fall was offset by a sharper decline in exports, which fell by 11.7%, to 169.3 billion euros. Commercial activity amongst the euro members fell by 6.8% in the tenth month of the year, to 166.1 billion euros.
Litecoin, Dash, and Binance Coin have also made double-digit gains in the dizzying rally, which comes amidst a string of positive headlines. PornHub made cryptocurrency the default payment option on Tuesday, the Federal Reserve committed to additional stimulus on Wednesday, and Elon Musk whipped up a social media frenzy on Sunday by asking MicroStrategy CEO Michael Saylor how to buy large amounts of Bitcoin.
On Sunday at 11:55 p.m., an agreement was reached in the U.S. Congress for the $900 billion fiscal stimulus bill that will relieve the impact of the Covid19. This program represents 4.2% of US GDP. Today, the House is expected to vote on the bill, followed by the Senate.
The Spanish airline and its UK parent company IAG have approved the acquisition of Air Europa for €500 M. With the provison that SEPI facilitates the final agreement. This figure is half of what was agreed a year ago when the operation began to be forged due to the impact of the pandemic. The payment will not be made until 2026.
Last week the government published the terms and conditions for the 5G auction to be held in Q1 21. Eight frequency blocks (700 MHz) will be bid on with a total starting price of 1,170 million euros, a one-off payment and a 20-year usage period. Obligations of 100% coverage are established for populations of more than 20,000 inhabitants in a period of 3 years, equivalent to providing service to 70% of the population. In addition, coverage will have to be given to highways, freeways and high-speed train stations.
Peter Isackson | A year ago, Elon Musk was officially worth about $20 Bn. Two weeks ago, he became the world’s second-richest person, with a fortune estimated at $128 Bn. Thus, Musk deserved a lengthy video interview with the Wall Street Journal. It could probe into how Musk managed to become the world’s wealthiest and most admired innovator. The Journal couldn’t saddle any random hack with that formidable task, and so its editor-in-chief, Matt Murray, rose to the occasion. The interview lasted half an hour and can be viewed on YouTube.