McDonald has announced it will launch a Vegetarian Outlet in India sometime June 2013. This will be the first vegetarian restaurant in the world! A few other fast food restaurants are fleeing into India in attempt to capture a consumer base of 1.2Billion people. Can you say "McDonaldization" I mean globalization.
India released its trade balance on Monday. Economist forecasted a deficit of -8.8Billion however their estimates were wrong. Actual number was -15.5Billion! I think they(economist) need to update their model. This means Imports outgrew exports by 15.5Billion dollars. This re-affirms our belief that India is in the process of industrialization and has a lot of growth potential.
The dreaded Troika stepped back into Greece this week to impose more restriction. Austerity is a dirty nine letter word for many Greeks. The public force (police and military) successfully opposed cuts to their pay checks. This means the ministry of Finance will look into other areas to cut…. PENSIONS are next! With unemployment almost at Spanish levels of 25% a cut to pensions will be devastating. Old age pensioners are the bread winners for large number of unemployed. Hundreds of retirees took to the street their signs and protested this week.
On a Euro wide level, Purchasing Manufacturing Index (PMI) was less than 50 indicating again another contraction in the economy. Managers are still bearish. Here are more gloomy numbers to show that Europe is in a big mess.
*Retail Sales (MoM) : Down -0.2%
*GDP(QoQ) : -0.2%
Much attention to Congressional speeches this week adverted attention away from the real problem. Unemployment is still above 8% and wont seem to go down no matter how much stimulus and tax breaks are given. Plain and Simple, business aren’t hiring new workers. Unemployment rate came out this week, it still remains above 8% at 8.1%(not seasonally adjusted). Also, manufacturing index came out showing that levels are below 50 which shows a bearish outlook in business.
As expected, interest rate remained unchanged on Wednesday. Bank of Canada kept rates at 1%. Furthermore, Purchasing Manufacturing Index is well above 50 at 62.5.
Canadians are doing well! Carney stated "As long as demand for commodities are strong Canada will do well" In other words "Expensive oil = happy Canada."