Hungary is not following a state capitalism model. It is not the state itself that owns most strategic assets, but businessmen close to the party in power, Fidesz. One might say this is closer to the Putyin playbook, creating a class of oligarchs that control the commanding heights of the economy (banks, telecom interests, utilities, … Continue reading "The Oligarch Model in Hungary By Les Nemethy, CEO Euro-Phoenix M&A Advisors, former World Banker" The post The Oligarch Model in Hungary <b...| Europhoenix
At the IMF Annual Research Conference on November 9, 2023, Chair Powell stated: “The Federal Open Market Committee is committed to achieving a stance of monetary policy that is sufficiently restrictive to bring inflation down to 2% over time; we are not confident that we have achieved such a stance.” My translation from Fedspeak: inflation … Continue reading "Inflation, Deficits and Compounding Debt By Les Nemethy, CEO Euro-Phoenix M&A Advisors Ltd., former World Banker" The post Inflat...| Europhoenix
The US economy is powering forward with almost 5% GDP growth as per the last measured quarter. Global GDP growth is in the range of 3%. This article will explore whether we are reaching (or have already passed) a tipping point. I will look first at some of the tailwinds the global economy experienced since … Continue reading "Is the Global Economy reaching a Tipping Point? By Les Nemethy, CEO Euro-Phoenix Financial Advisors Ltd., former World Banker" The post Is the Global Economy reaching ...| Europhoenix
Soon after re-election in 2010, Fidesz, the ruling party in Hungary, introduced a new ideology, the National System of Cooperation (Nemzeti Együtműködesi Rendszer, NER); it is related to Orban’s concept of “illiberal” democracy. Part of this ideology is the creation of a new class — the NER Knights, oligarchs who owe their wealth to Government … Continue reading "How Hungary’s Oligarchs destroy Standards of Living for the Majority By Les Nemethy, CEO, Euro-Phoenix M&A Advisors,...| Europhoenix
According to Eurostat’s release dated July 19, 2023, Hungary had by far the highest inflation in the Eurozone—not by a little—roughly triple the EU average and almost double the next highest countries (Poland, Czechia and Slovakia). The above chart shows Hungary as such a massive outlier, the analysis should be of interest also to non-Hungarian … Continue reading "Why is Hungary the EU Inflation Leader? Inflation as a “Hungaricum” By Les Nemethy, CEO Euro-Phoenix M&A Advisors, for...| Europhoenix
Small and Medium-sized Enterprises (SME’s) are the main generators of wealth and employment in the vast majority of countries. Hence any Government should carefully monitor their performance and do everything possible to create a supportive environment for them. This article first looks at the statistics on SME performance in the Visegrad Four (V4) lagging the … Continue reading "Comparing the SME Sector of Hungary with the Visegrad Four and EU By: Les Nemethy, CEO, Euro-Phoenix M&A Advis...| Europhoenix
GDP growth (hence wealth creation and improved standards of living) are not possible without competitiveness. So the European track record on competitiveness is a genuine cause for concern. This article breaks down the subject Europe’s declining relative competitiveness into four areas: (a) how to define competitiveness? (b) what stats might be used, and what do … Continue reading "Europe’s Declining Relative Competitiveness By Les Nemethy, CEO, Euro-Phoenix M&A Advisors, former World B...| Europhoenix
New regulations on capital requirements for US banks are likely to be announced before the end of June, 2023. They are highly anticipated, and will impact not only the banking world, but also US and global economic performance. After the 2008 Great Financial Crisis (GFC), US banking regulations were tightened and capital reserve requirements increased; … Continue reading "The US Fed faces a difficult Decision on Capital Requirements for Banks By Les Nemethy, CEO, Euro-Phoenix M&A Advisors, ...| Europhoenix
Germany’s economic miracle over the past few decades has been based on two major economic assumptions: cheap Russian energy and open access to an ever-growing Chinese market. Both of these assumptions have recently been proven very wrong, thanks to the war in Ukraine and Chinese threats of invading Taiwan. Due to loss of cheap energy … Continue reading "Germany’s Dual Shock By Les Nemethy, CEO Euro-Phoenix M&A Advisors and former World Banker" The post Germany’s Dual Shock <b>By Les N...| Europhoenix
There is the possibility of a doom loop between small US banks and commercial real estate. The scenario looks like this: Small banks in the US hold over 70% of commercial real estate loans. Prices on most types of commercial real estate in most localities are falling; in some major cities it is estimated that … Continue reading "Small US Banks and Commercial Real Estate—A Doom Loop? By Les Nemethy, CEO, Euro-Phoenix M&A Advisors, former World Banker" The post Small US Banks and Commercial...| Europhoenix
US Government debt has already surpassed the legislated debt ceiling of $31.4 trillion, with the Treasury relying on “extraordinary measures” to stave off default. Janet Jellen, US Secretary of the Treasury, stated that a default could happen as soon as early June, at which time the Government could run out of cash to fund day-to-day … Continue reading "US Government Default?! By Les Nemethy, CEO, Euro-Phoenix M&A Advisors, former World Banker" The post US Government Default?! <b>By Les...| Europhoenix
I have been writing that we are facing a period of high inflation since long before it was fashionable. Now I believe that on the balance of probability we face an entire decade of high inflation. That’s not to say that inflation cannot decrease at times during the decade (e.g. if there is a recession)– … Continue reading "Some Thoughts on Inflation By Les Nemethy, CEO, Euro-Phoenix M&A Advisors, Former World Banker" The post Some Thoughts on Inflation <b>By Les Nemethy, CEO, Euro-Phoen...| Europhoenix
Most readers of this column will have heard of bail-outs (e.g. use of government money to stabilize banks and other financial institutions); few will have heard of bail-ins (e.g. where use depositors’ and bondholders’ funds) is used to stabilize banks. During the 2008 Great Financial Crisis, regulators had no legislative authority for bail-ins. Hence in … Continue reading "Bail-ins: Are your Bank Deposits Safe? By Les Nemethy, CEO Euro-Phoenix M&A Advisors, former World Banker and Leo R...| Europhoenix
With the attention of economists and financial analysts absorbed by the banking crisis, other clouds on the horizon are being neglected. I see sovereign default in emerging markets as one of those risks. There are quite a few countries on the critical list; this article deals with Pakistan, a country of 230 million people, the … Continue reading "Pakistan Sovereign Default on the Horizon? By Les Nemethy, CEO, Euro-Phoenix M&A Advisors, former World Banker" The post Pakistan Sovereign Defaul...| Europhoenix
For the past six months, the US Fed has been fighting inflation by jacking up interest rates and tightening money supply to fight inflation. This author, and others, predicted that “something will break”. Something did break: Silicon Valley Bank (SVB). And now the Fed is busily trying to contain the contagion. This article discusses how … Continue reading "The Fed will prioritize financial stability over the fight against inflation By Les Nemethy, CEO, Euro-Phoenix M&A Advisors, former ...| Europhoenix
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This article deals with the possibility of problems in the paper gold market. There is vastly more paper gold (Exchange Traded Funds (ETF’s), gold contracts, futures, options, etc.) than physical gold—some USD 200-300 trillion1, compared to ca. USD 11 trillion of physical gold (of which central bank holdings would constitute ca. USD 1.0 trillion)2. The … Continue reading "An Upcoming Paper Gold Crisis? By Les Nemethy and Alberto Scalabrini"| Europhoenix