Massive expansion of global labour supply — The massive expansion of global labour supply, particularly in the wake of China’s economic liberalisation, and the corresponding dampening effects on wage growth in the industrialised countries. According to recent studies, this effect could soon reverse as China’s working-age population will shrink asRead More →
True-sale versus synthetic securitisation In short, securitisation is the transformation of income-yielding assets (typically loans) on bank balance sheets into tradable securities. In its simplest form, the originator, usually a bank, bundles a pool of loan exposures to pass them to the capital markets. There are two main securitisation types,Read More →
Labor slowdown If new entrants and retirements follow the historical pattern, these figures imply that labour force growth could slow to around an average of 85,000 monthly. With the economy near full employment, payrolls should grow by a similar amount. That is well below the average monthly payroll gain ofRead More →
Positive demand effects will be diluted However, as new building projects also focus on these sub-markets, positive demand effects will be diluted. Because of existing demand overhangs, disadvantages are emerging on the Frankfurt residential property market from a potential relocation of employees. Price growth and the shortage of housing willRead More →
incidental activities Other income earned by an individual from incidental activities, such as from publishing articles in the professional press, is fully taxable. However, minor fees for certain activities enjoying special favour, such as coaching an amateur basketball team, are exempt. The granting of stock options by German or byRead More →
Risk outlook: Even in case of a rate shock Risk outlook: Even in case of a rate shock, prices and rents should continue to rise in 2018, The contradictory effects on housing demand imply that the effect on housing prices will be relatively small. With housing in very short supplyRead More →
Proceeds of ECB’s Bond buying European banks are in a similar position. Most of the proceeds of the ECB’s bond buying program remain on deposit with the ECB. Across the eurozone, bank loan portfolios and deposits have been little changed since the crisis. Since the ECB is unlikely to startRead More →
Impressive momentum in recent years Synthetic securitisation has seen impressive momentum in recent years which has gone largely unnoticed. Banks have increasingly tapped this market to manage credit risk and improve their capital ratios. Policymakers have paid renewed attention to securitisation markets, too. They see securitisation as a tool toRead More →
Summary The question regarding the consequences of a Brexit for the EU, the United Kingdom and Germany is expected to remain unanswered for some time. The political uncertainties and exit scenarios range from a contentious separation to a second referendum. At present, however, we can expect that Frankfurt will beRead More →
Key ‘export’ is the legal system Another key ‘export’ is the legal system, which ranks highly in all international comparisons. Germany also regularly occupies leading positions in rankings of governance and administration quality. This formidable success is the result of a unique combination of micro- and macroeconomic factors, as wellRead More →
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