Economics

In Delhi, the temperature hit 42.1°C this year. But some people didn't have the luxury of going indoors because the street was their workplace. India’s 3 crore+ street vendors from fruit sellers to chaat walas spend over 12 hours a day under the open sky. They’re not just battling heat; they’re battling the vanishing shade. A recent study by Azim Premji University in Hyderabad reveals a disturbing trend: "As Indian cities grow vertically, their green cover shrinks." And the hardest hit? Women, migrants, and informal workers who depend on those trees for a livelihood. “When the tree was there, I sold 20 plates of Bhel. Now, I sit in the sun and barely manage 6.” -  a street vendor in Delhi. This isn't an isolated story. According to Greenpeace India & National Hawkers Federation (2024) survey: - 50% of street vendors in Delhi lost income during the summer months - 80% saw a dip in footfall due to extreme heat - ₹500–₹600 worth of goods go bad daily due to heat damage - 71% couldn’t afford medical care - Women vendors reported rising BP, menstrual irregularities, and sleep deprivation. And yet, despite Delhi hitting a record-breaking 50°C last year, heatwaves are still not recognized as a national disaster. Worse, street vendors are often left out of urban planning and climate resilience strategies. Green spaces are not aesthetic choices- they are economic lifelines. For many vendors, a tree is more than shade. It’s a signboard, a cooling system, and a guarantee of survival. And yet, the people who pollute the least are paying the highest price for climate change. If you’re in a position to influence policy, design public spaces, or fund local initiatives - pause and ask: Are we building cities that everyone can survive in?

1st Time Ever, CLO Market For the first time ever in the history of the U.S. CLO market an interesting dynamic has emerged. CLO new issue volume is at a record levels, YET the size of the CLO market has declined. This table below illustrates 10-years of history; however, one can go all the way back to 1990 (first CLO ever issued) to see that this is indeed a first. Negative net issuance despite record primary issue occurred as seasoned/older CLOs that are past their reinvestment period are amortizing or being liquidated, either into the open market (BWIC) or used to form new CLO from the same manager. Demand for CLO tranches starts with the AAA tranche since it is ~60% of the capital structure. AAA demand is rock solid, led by large U.S. & Japanese banks, global insurance companies, and the new kid on the block: Janus’ CLO ETF (JAAA) which has grown to $10B, creating an additional bid for AAAs. As a result, CLO liabilities have tightened, which is accretive for CLO equity investors. CLO managers employ teams of investment professionals that are experts in underwriting each BSL, building and managing a highly diversified portfolio with an enduring credit profile to maintain low default rates, and avoiding CCCs, a bifurcation that drives default rates. Cash flow distributions to CLO equity investors benefit from tighter CLO liabilities, the return generated during the warehouse period as the CLO ramps, +reinvestment during the investment period, +active management that adds alpha via relative value generated by CLO manager, +repricing and extensions of CLO liabilities later in the CLO life span. Today, CLO equity holders are earning their highest cash distribution in years, resulting in mid-teens IRRs, strong DPI and MOICs. I believe this dynamic will continue to be net-positive for world-class CLO managers, who have proven incredibly adept managing through the cycles. The kicker is when the CLO manager shares a portion (10-20%) of its management fees that it earns from managing the CLO (~40 bps) with the CLO equity holders. This fee sharing arrangement was first introduced post-GFC when CLO managers raised CLO equity funds required under risk-retention requirements known as The Volcker Rule. Since the Volker rule is no longer applied to U.S. CLOs, fee sharing arrangements are less prevalent today, but available from select managers. Conclusion: The technical condition that exists today, with tight liabilities and net-negative primary issuance, yet robust new issue supply and improving credit dynamics represents a unique opportunity for CLO equity.

#AntimicrobialResistance (AMR) threatens to send the world back into the era before antibiotics and other antimicrobials, when a routine infection could be deadly.     Already, an estimated 5 million people die every year from infections associated with AMR.    Over the next decade, AMR could reduce global life expectancy by 1.8 years and cost the global economy more than $800 billion annually, due to additional health costs and lost productivity.     It’s fueled by many factors:  1. Poorly functioning health systems 2. Weak regulation 3. Sub-standard practices in industrial farming and agriculture 4. Poor management of waste and wastewater      AMR disproportionately affects people in low and middle-income countries, and is closely linked to poverty and a lack of access to adequate water, sanitation and hygiene.     Later this month, the World Health Assembly will consider how to accelerate action in the human health sector, as part of a multi-sectoral #OneHealth approach.     The World Health Organization has outlined six recommendations for consideration: 1. Leadership and governance, based on effective and well-resourced coordination that includes all relevant stakeholders, and high-level oversight.   2. Allocation of domestic and international funding for accelerated national, regional and global action.   3. Evidence for action through strengthening AMR and antimicrobial use surveillance, strengthening bacteriology laboratory systems, research and sharing and use of data.    4. Accelerated implementation of a people-centred public health approach to address AMR, with a core package of interventions at all levels of health systems.    5. Scaling up learning, experience sharing and technical support for countries;    6. Promotion of science, research, and innovation, targeted to public health needs and to ensuring equitable access.   From communities to health workers. From youth organizations to parliamentarians.     From the private sector to people directly affected by drug-resistant infections and their consequences.    By working together, we can chart a clear path towards a safer world for all. 

The surprise to the upside on January’s #inflation numbers could complicate the Fed’s plan moving forward. If signals of ongoing inflationary pressure continue, particularly in the midst of potentially inflationary policies, a rate hike wouldn’t be completely out of the question this year, and further cuts less likely anytime soon. The FOMC paused their rate cuts as inflation progress seemed to slow, and while there isn’t a definite case for inflation climbing again, it’s also becoming more difficult to say that it’s moving in the right direction. Price growth quickened in the first month of the year, with inflation rising in food and shelter, among others. Progress on consumer inflation has stalled, and we’re all paying the price. But a fairly notable chunk of the increase in food prices — which we all interact with — is credited to eggs. Egg inflation rose over 15%. This doesn’t only impact at-home bakers and breakfast makers, but the restaurants that depend on eggs too. We saw last week that Waffle House, a bastion of inexpensive late night and morning meals, is adding an egg surcharge to cope with the impact of bird flu. That said, egg prices account for less than 0.2% of the total headline inflation index, so while they are a contributing factor, continued high price growth can’t be blamed on them alone. Used cars, shelter and transportation cost increases also played a role in quickening price growth for the month. #Wholesale inflation numbers due out tomorrow could provide insight into what consumer inflation could look like in the near future. #economy #data

Looking backwards to predict the future is misleading. New technologies scale far faster than their predecessors. Solar took just eight years to grow from 100 TWh to 1,000 TWh—and only three more years to double again, surpassing 2,000 TWh in 2024. For each of the past three years, solar has been the largest source of new electricity worldwide. Nothing else in power generation has scaled this quickly. Falling costs, modular design, and rapid deployment are turning solar into the backbone of the emerging global energy system. It’s clean, scalable, and increasingly central to modern economies. And as battery costs tumble and storage deployment accelerates, a growing number of projects are targeting round-the-clock solar electricity.

By 2053, Black wealth could fall to zero if current trends continue. This isn't just a number—it’s a stark reminder of systemic inequities and the urgency of collective action. But here’s the thing: statistics like this don’t tell the full story. They don’t account for the power we hold to shift the narrative. As leaders, innovators, and culture-makers, we must embrace wealth equity as a core strategy. Here’s how we can start rewriting the script: 1️⃣ Build Financial Resilience Through Ownership: Ownership—whether it’s businesses, real estate, or intellectual property—is one of the fastest paths to generational wealth. Minority-owned small businesses, for example, often overlook opportunities like supplier diversity programs or university procurement partnerships. Tapping into these underutilized resources can accelerate growth. 2️⃣ Invest In Community-Centric Innovation: Many of the apps, services, and products we rely on don’t center our lived experiences. Imagine if our $1.8 trillion in buying power was directed toward solutions built for us, by us. It’s time to create platforms that reflect our values and needs, not just consume them. 3️⃣ Prioritize Financial Literacy and Intentional Spending: Knowledge is power. From understanding the compounding effect of investments to teaching the next generation how to save and build credit, we must normalize financial conversations. Similarly, supporting Black-owned businesses should be an everyday practice—not just a seasonal one. 4️⃣ Collaborate and Scale Thoughtfully: Sometimes, intentional smallness is the path to big impact. Entrepreneurs, for example, don’t need to scale at the expense of sustainability. We can focus on profitable, community-centered growth without being pressured into rapid expansion. This isn’t just about avoiding a financial cliff—it’s about building a future where our contributions are valued, our stories are told, and our wealth is sustained. So, let’s not wait for solutions to come from elsewhere. Let’s lead. Let’s invest in ourselves, our communities, and our collective power. What steps are you taking today to shift this trajectory? I’d love to hear your perspective.

🔥 Climate risks are no longer abstract—they’re disrupting businesses, communities, and economies right now. The World Economic Forum’s 2024 report, "The Cost of Inaction: A CEO Guide to Navigating Climate Risk", delivers a sobering message: ignoring climate risks isn’t just irresponsible—it’s economically devastating. 🌡️ Key insights from the report: 💥 Climate-related disasters have caused $3.6 trillion in damages since 2000, exposing critical vulnerabilities in supply chains and infrastructure. 📉 Physical risks could put 5-25% of EBITDA at risk for some sectors by 2050 under a 3°C warming trajectory. 💸 Transition risks, like carbon pricing and changing regulations, could impact 50% of EBITDA in energy-intensive industries by 2030. 🌱 Every $1 invested in climate adaptation yields $2-$19 in avoided costs, while green markets are projected to grow from $5 trillion in 2024 to $14 trillion by 2030. 💡 My reflections: 🔄 Resilience isn’t enough anymore. Too often, we focus on simply "weathering the storm" of climate risk. But true leadership is about rebuilding something better—rethinking markets, redesigning business models, and creating solutions that lead entire industries forward. 🌍 Supply chain fragility is the Achilles’ heel of the global economy. A single extreme weather event can cascade across operations, grinding everything to a halt. Climate-resilient supply chains can’t just be about survival—they must be radically adaptive, decentralized, and built to thrive under disruption. 📊 Climate risk is fundamentally redefining the concept of value. Businesses stuck chasing quarterly earnings are missing the bigger picture. In a world of rising costs and irreversible climate impacts, long-term value will belong to those who embed sustainability, resilience, and equity into their strategies. The time for cautious, incremental steps has passed. How are we using this moment to transform the way we work, innovate, and lead? #ClimateAction #Sustainability #Resilience #Leadership #Innovation

You may not believe in climate change (despite scientific consensus), but your insurance provider sure does. Günther Thallinger of Allianz puts it plainly: if global temperatures rise by 3°C (which is where we’re currently headed) the insurance industry will collapse. “The financial sector as we know it ceases to function. And with it, capitalism as we know it ceases to be viable.” Extreme heat and climate-driven disasters have killed and displaced millions across the globe. This isn’t normal. These events are becoming more unpredictable, more intense and more deadly. Climate change and the destruction of nature are combining to create the perfect storm, fuelling disasters while stripping away our capacity to endure them. Right now, in fact, you are likely reading about a fresh disaster that is ‘unprecedented’. And the financial fallout is mounting. Global insured losses from natural (climate) disasters have averaged about US$100 billion over the past five years (Moody's). And insurance providers are hiking up premiums or, as was the case in California, refusing to issue new home insurance policies due to climate disaster (see State Farm and Allstate). As Günther says, "Heat and water destroy capital. Flooded homes lose value. Overheated cities become uninhabitable. Entire asset classes are degrading in real time." The risk of climate change, he says, has historically been managed by the insurance industry. But we are fast approaching temperature levels "where insurers will no longer be able to offer coverage for many of these risks." Insurers don’t deal in opinion, they deal in data. And the data is clear: climate change and nature decline aren’t up for debate; they’re a reality that you are witnessing. Whether or not you buy the science, the financial consequences are impossible to ignore. Your premiums have already noticed. Thankfully, we already have many of the tools and solutions to address climate change and the destruction of nature. What we don't have? Consistent political will. For Australians wanting to make a difference ahead of the election, Biodiversity Council has created a simple tool to help you contact your local political candidates and call for stronger environmental action: https://lnkd.in/ghAxEv2y They have also identified the key actions we need the next government to take to safeguard and restore the environment: https://lnkd.in/g62uCTfd See Günther Thallinger's post: https://lnkd.in/gahhv6MK See the report by Moody's: https://lnkd.in/ggE_2VCa See the article by The Guardian: https://lnkd.in/gpGBXCRZ

As the CEO of DP World Europe, it’s my job to anticipate the major logistics trends that will continue to impact our industry. And in the wake of DP World’s third annual Global Freight Summit, I found myself reflecting – what are the trends that freight forwarders, supply chain providers, and industry specialists alike are looking out for? Here’s my view: 1. Digitalisation: In Europe’s highly interconnected trade ecosystem, digital solutions have been critical in streamlining supply chains and improving cross-border efficiency. Embracing smart logistics has allowed us to reduce costly delays at our ports and terminals and strengthen Europe’s position in global trade. 2. Sustainability: Europe is at the forefront of a more sustainable transition, and decarbonising our supply chains is not just an obligation but a competitive advantage. Future trade in Europe will be as much about greener credentials as about efficiency. 3. Geopolitical and Macro-Economic Uncertainty: From inflation to energy crises, Europe’s trade landscape has taught us the importance of resilience. Building flexibility into our operations and fostering meaningful collaborations with our customers have been vital in mitigating risks and maintaining stability. 4. Socio-Cultural Change and Demand: European consumers are driving demand for more sustainable, faster, and more transparent supply chains. Adapting to these expectations has reinforced the need for innovative solutions that not only meet demand but also reflect the values of the markets we serve. Europe’s trade landscape is evolving rapidly, and with every challenge comes an opportunity to better our industry. To find out more about how DP World is finding solutions to supply chain challenges, visit: https://lnkd.in/esfMsv3y

Trump’s TARIFFS EXPLAINED 📈 Wait...did you feel that jolt in the markets?  The US has returned to tariff levels we haven't seen in over a CENTURY! If you work in finance or accounting, you need to understand how these trade barriers will impact your company's bottom line... ➡️ WHAT ARE TARIFFS? Tariffs are quite simply taxes on goods imported from other countries. They're charged at the port of entry, not overseas. Despite some claims, these costs are paid by the companies bringing goods into the country, not by foreign governments. Tariffs have historically been used to encourage consumers to buy domestically manufactured goods. ➡️ HOW WERE THE TARIFFS CALCULATED? The calculation method caught my attention immediately. Instead of mirroring what other countries charge us, the administration used a formula based on trade deficits. They took the US trade deficit with each country, divided by total imports from that country, then halved it. This approach doesn't accurately reflect other countries' actual tariff rates. For example, while Trump claimed China charges a 67% tariff, the average is actually closer to 3-10%. ➡️ WHO IS AFFECTED BY TARIFFS? These tariffs will have a wide-ranging impact: 1️⃣ American Consumers: They'll face higher prices as tariff costs get passed on. The average American family could potentially pay thousands more annually. 2️⃣ American Businesses: Companies relying on imported components will see increased costs. Firms that design in the US but manufacture abroad (Apple, Nike) could be significantly affected. 3️⃣ The Stock Market: Markets reacted immediately with significant declines. We saw an estimated $3.5 trillion vaporized from markets overnight. 4️⃣ Global Trade: These tariffs are already triggering retaliation. China announced retaliatory measures within days. ➡️ PROPONENTS OF TARIFFS: Figures like JD Vance argue that American manufacturing jobs outweigh cheaper imported goods. They call this a "National Emergency" in trade relations. Their primary goal is manufacturing revival in the USA. They aim to protect national security and rebuild American industries. They want to counter unfair competition from countries with subsidized manufacturing. Some believe it could force the Federal Reserve to lower interest rates, helping US refinance debt. ➡️ CRITICS OF TARIFFS: Critics point to the immediate market reaction with significant declines. They warn about higher inflation, with preliminary estimates suggesting a significant CPI jump. They fear large-scale trade wars from retaliation by China and the EU. Many economists see potential for stagflation if the economy slows while prices rise. The scenario of "trade wars and global economic fallout" keeps finance professionals up at night. === How is your company preparing your financial forecasts for these changes? Have you calculated the potential impact to your bottom line? Join the discussion in the comments below 👇