Singapore economy shrinks 4.1% in third quarter

AFP NewsOctober 14, 2016

Better Than WWEyesterday

I hope that Indian guy knows his work

17% contraction in manufacturing is a clear indication our currency is too high

We had priced ourselves out of the market be it in currency, cost of operating business, etc

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  TRUST WHO THAN.6 hours ago

  Precisely
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  ricky l10 seconds ago

  Weak demand does not mean our currency is too strong.

  That is even by depreciating the currency, weak demand means that consumers will still not buy - due to falling business confidence (not investing) and consumer confidence (not buying).

  Singapore is both a net exporter and net importer - whereby we import raw materials, intermediate products and make it or assembled it into finished products and sell it. Or we import finished foods and products for our consumption (as we don't grow them).

  The strength of our currency is based on a basket of currencies (based on our trade partners) we where move up and down - to ensure trade competitiveness.

  Our monetary policy is trade focus.

  So until and unless protectionism is lifted, unless more trade agreement are approved - to prop up more demand - business demand, and consumer demand will continue to be languishing.

  

  ricky l10 seconds ago

  So if our currency is weaken - it means we will need to pay more for the imports vis-a-vis US dollars - and when we convert the imports into finished goods for export - then we need to sell at a higher price - and we will not be competitive.

  But if our currency is at the right level - we buy import at a lower price and our finished goods will be less expensive - and our finished products will be more competitive when we export overseas when converting into US dollars. (As our currency is stronger).

  

  ricky l10 seconds ago

  If you understand multiplier effect or circular flow of income :-

  When business confidence grow - business will invest more.

  When consumer confidence grow - consumer will buy more.

  When there are less protectionism - trade will increase.

  All these will lift the World Economy - and demand will rise.

  Now the whole World is facing :-

  (1) lowering of business confidence - business not investing.

  (2) lowering of consumer confidence - consumer not spending.

  (3) growing protectionism - like brexit, donald trump syndrome.

  Only when the above are overcome - World Economy will grow.

  That is why Donald Trump is a great sinner.

  

  ricky l10 seconds ago

  And Government spending is also nearing the tail end :-

  (1) US not collecting enough income tax - to prime the Economy by spending on infrastructure.

  (2) Japan has been upping its Government spending by increasing national debt - a few times --- and now seems to be tapering.

  But unable to get private enterprise to invest more - due to falling population (reducing consumers to spend).

  (3) China has been fueling its State Enterprises, private enterprise with easy credit from its banks - and its national debt has reached more than 200 over % in national debt - and this is no longer sustainable. Government spendings in building infrastructure has also ended up in many property and infrastructure that are not used.

  --- So one very important aspect of Economy priming - through Government expenditure --- is not working --- leading to World Economic slowdown.

  Of course another leading factor is the plummeting oil price that have hit the marine engineering in drill for oil - due to oil gluts and falling price - like OPEC, non-OPEC, Iran, Iraq new supply, Russia etc --- all these lead to Countries flourish with oil money previously - now face money crunch due to fall in oil price --- dampening world demand.

  

  ricky l10 seconds ago

  All the above negative factors :-

  (1) Poor consumer confidence

  (2) Poor business confidence

  (3) Growing trade protectionism

  (4) Losing stamina in Government spendings

  (5) Low oil price

  All result in Slow Global Economic Growth worldwide ---- and if this is plot into an Economic Model ---- all economic variables for growth - plummet ---- contributed by all falling demands (consumer demand, business demand, government demand).

  

  ricky l20 seconds ago

  So how to prop up World Economy?

  (1) Boost trade - eg. finalised and approve trade agreement to improve trade - generate demand.

  (2) Boost business confidence - by encouraging business investment - when more trade, business confidence boost, and will increase investment.

  (3) Boost consumer confidence - by ensuring job security, consumer confidence grow and spending increase - and will lead to business investment.

  (4) Targeted Government spendings to boost growth - business confidence improve, increase investment, increase jobs, lead to increase consumer spendings with more income.

  (5) Oil price reach a sustainable level that boost oil drilling and oil exploration and oil revenue.

  All the above will help to bring about World Economic Growth and improve demand.

  Thus Government and Countries should collaborate, cooperate on business, trade, investment, travel - that will boost World Economy.

  Not engage in hostilities and conflict --- that will not help World Economy to grow.

  

  ricky l10 seconds ago

  和气生财，动气挂彩，生气烧财。