Tag: Recession

Is Economic Recovery on the Horizon?

Navigating a mixed economic forecast, photo: (nz)dave/flickr

This week the ISN asks whether a global economic recovery could soon be in sight despite mixed economic indicators and rumblings of a ‘double-dip’ recession.

This ISN Special Report contains the following content:

  • An Analysis by Dr Dean Baker of the Center for Economic and Policy Research about Europe’s prospects for economic recovery given belt-tightening austerity measures.
  • A Podcast interview with Dr Klaus-Jürgen Gern of the Kiel Institute discusses the forecast for global economic growth and the prospects of economic recovery in the US, Asia and Europe.
  • Security Watch articles about the impact of the Great Recession around the globe.
  • Publications on the financial crisis housed in our Digital Library from the likes of the Kiel Institute, the Center for Economic and Policy Research and much more.
  • Primary Resources, like the full-text of President Barack Obama’s speech on financial rescue and recovery of the US economy.
  • Links to relevant websites, such as the IMF’s World Economic Outlook website.

One Government’s Jackpot is Another Government’s Vice

Rolling the dice to roll in the dough / photo: Maximaximax, wikipedia
Rolling the dice to roll in the dough / photo: Maximaximax, wikipedia

Casinos count as one of the most recession-proof industries. They are also a convenient source of tax revenue for governments. That’s why many legislators tend to relax their moral reservations towards the “vice of gambling” and allow the re-opening of casinos to generate new government income.

Grappling with a gaping hole in its state budget, the Massachussetts legislature is seriously considering legalizing casino gambling in the state. The casino industry in the United States is even expected to keep struggling architects afloat, who are among the hardest hit by the recession. In fact, only the construction of churches seems to keep up with that of casinos.

Against all odds, the Russian government, which has been dealt a hard hand by the global economic downturn, is doing the exact opposite: As of today, casinos in Russia are outlawed.  It is the result of a law that seeks to “go all-in” with eradicating a vice that allegedly is widespread among the Russian people. The law is also designed to rein in an industry seen as a breeding ground for corruption and organized crime. From the new law, Russia expects a payoff in virtue rather than cash. Meanwhile, the Russian casino industry expects at least 350,000 job losses as a result of the shutdowns – in addition to the loss in revenue for the cash-strapped Russian state.

Alas, for hundreds of thousands of Russian casino industry employees, the game is over. Yet the ban’s effectiveness might be less certain than your survival in Russian roulette. The gambling industry is expected to go underground and thus more difficult to regulate and control. So will the ban ultimately help eradicate the vice of gambling? I wouldn’t bet on it.

Categories
Business and Finance

Is Anything Recession Proof?

Indian women in Akbarpura / photo: lecercle, flickr
Indian women in Akbarpura / photo: lecercle, flickr

Well, it turns out microfinance institutions and microenterprises may very well be.

In an interesting reversal of fortunes, small, flexible and locally connected microfinance institutions seem to be fairing better than their larger commercial counterparts in the current economic climate. Due in large part to flexible business models, locally connected operations (microcreditors tend to know their customers much better), low exposure to the hazy world of high-flying finance, and an attractive product, microfinance institutions are flourishing all over the world.

By lending small amounts to poor people with no traditionally defined credit-worthiness, microfinance institutions are keeping the lower tiers of the world economy afloat, even thriving in parts.

Continue reading “Is Anything Recession Proof?”