Eurozone Q4 2018 GDP up by 0.2% and European Union Q4 2018 GDP up by 0.3%; 2018 annual GDP growth at 1.8% for the Eurozone and 1.9% for EU; Italy in Recession

Seasonally adjusted GDP rose by 0.2% in the Euro area or Eurozone (EA) and by 0.3% in the European Union (EU) during Q4 2018, compared with Q3 2018.

EU and Eurozone GDP up to Q4 2018
Source: Eurostat

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Delinquency and Charge-off rates across banks in the United States remain low (January 2019 edition)

We answered the question whether bad loans were really increasing for banks in the United States at the end of December. We look at Delinquency and Charge-off rates across banks for United States across different products in this post.

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Individuals now consistently contribute over 80% of all U.S. federal taxes

One big impact of the U.S. tax cut for corporations has been that corporate taxes now just contribute 8.3% of all U.S. federal taxes. As import tariffs rise, custom duties have been rising at a staggering rate, and tariffs on imported goods together with taxes levied at production now contribute 8.1% of all U.S. federal taxes. Taxes paid by individuals contribute the vast majority or 82.3% of all U.S. federal taxes.

US tax breakdown until Q3 2018

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The U.S. total wage bill to corporate profitability ratio throws up several questions

In September last year we wrote why wages weren’t rising despite record employment and labour shortages and earlier this month we wrote that U.S. Corporate profits have been growing well and have hit a record high. We explore another angle, total wages (wages including bonuses and overtime – all before taxes) to the corporate profits (before taxes) ratio.

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Europe’s aging population is set to cause huge economic challenges

We wrote about population percentage for each country by age last year. Here’s a map of population percentage for age 65 and above:

Japan has the highest percentage of over 65s at 26.56%. The other countries that make the top 25 countries for over 65s population are Italy, Germany, Portugal, Finland, Bulgaria, Greece, Sweden, Denmark, France, Croatia, Spain, Estonia, Austria, Malta, Lithuania, Czech Republic, Slovenia, Belgium, Netherlands, United Kingdom, Switzerland and Hungary all of which are in Europe.

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Rising benchmark interest rates in the United States are having little impact on mortgage and saving interest rates as well as interest margin of banks

The Federal Reserve increased the target for the bank’s benchmark rate by 0.25% (to a range of 2.25% to 2.5%) at the end of December, the ninth rate rise since 2015. Rising benchmark interest rates are having little impact on mortgage and saving rates or interest margin of banks.

Interest Margin of Banks in the United States stood at 3.33% at the end of Q3 2018, up just 0.03% from Q2 2018 (3.3%) and up just 0.18% from Q3 2017 (3.15%).

US banks net interest margin January 2019

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