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Ukraine Could Lose Half Of Its Economy Due To War, According To World Bank 

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The World Bank released a report this weekend that stated Ukraine could lose almost half of its economy this year as a result of Russia’s invasion and the ongoing war between the two nations. 

The bank estimated that the “country’s GDP could decline by 45.1% this year, although the magnitude of the contraction will depend on the duration and intensity of the war.”

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Since Russia invaded, Ukraine’s infrastructure has endured excessive amounts of damage and destruction. Bridges, neighborhoods, and ports have been hit with multiple blockades, and farmland throughout the nation has become the setting for multiple battles. 

Before this conflict, Ukraine was a major exporter of wheat and sunflower oil, however, the growth of both has been interrupted by fighting. Farmers are also finding it difficult to access machinery and other essential products needed for farming that would typically arrive through Black Sea ports. 

“The magnitude of the humanitarian crisis unleashed by the war is staggering. The Russian invasion is delivering a massive blow to Ukraine’s economy and it has inflicted enormous damage to infrastructure,” Anna Bjerde, the World Bank’s vice president for the Europe and Central Asia region, said in a statement.

“Ukraine needs massive financial support immediately as it struggles to keep its economy going and the government running to support Ukrainian citizens who are suffering and coping with an extreme situation.”

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Ukraine Finance Minister Serhii Marchenko has stated that “the government is still functioning, despite the war.”

“About a third of the country’s economy is no longer functioning as the atrocities continue and millions of people flee as refugees into neighboring countries,” he explained. 

Marchenko added that as of late March, nearly 3 million Ukranians have lost their jobs; preliminary reports show the nation’s economy has already lost approximately $565 billion. 

To keep the economy afloat, the government has “leaned on war bonds, as well as less traditional avenues, such as fundraising in cryptocurrencies and the sale of non-fungible tokens (NFTs),” according to Marchenko.

“I think that the true figures of total economic loss would be clear only after the war,” he said.

“The [best] scenario is to end the war as quickly as possible.”

Democrats Expected To Pass Biden’s $1.75 Trillion Climate And Social Spending Package This Week 

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House Democrats are quickly trying to pass President Biden’s $1.75 trillion social and climate spending package this week. The package would give democrats a head start at making infrastructural changes before the Thanksgiving holiday.

The package has been extensively debated all summer and fall, mainly over the contents of the package and wear specific money will be allocated to. 

Democrats currently feel like they’re on the verge of a huge milestone in the House, where the passage of this package would be seen as a huge victory for the party. House moderate holdouts have promised to support the bill when it’s brought to the floor this week. 

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This Monday, Biden will be signing the $1.2 trillion infrastructure bill as well, so the administration in general is gearing up for pushback, and to get moving on the actual plans within the bills. 

“Despite the possibility of new drama in the Senate, we’re confident Congress can send the package to Biden’s desk by the end of the year. I think we’ll get it passed before Christmas,” one senior Democrat, G.K. Butterfield (N.C.), former chairman of the Congressional Black Caucus.

Biden and the democratic party in general have been under fire for a recent slew of economic changes, such as general inflation, labor shortages, and a supply chain “clog” that’s preventing our retail markets from thriving. These issues in combination with the Covid-19 pandemic have led to a lot of disagreements among our leaders. 

“Democrats need to reassess their strategy. We need to have legislation that actually, forcefully delivers for working people,”  said progressive Rep. Alexandria Ocasio-Cortez (D-N.Y.). 

Moderate Rep. Abigail Spanberger (D-Va.) is supportive of several key elements of the Biden package, such as “tackling climate change, extending the child tax credit and lowering prescription drug prices, but Democrats have failed to explain how the legislation will help struggling American families.”   

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“People are busy, they have jobs, they have lives, they have worries, they have kids, they have joys. If someone turns on the news and [hears] ‘We really need to make these major investments in human infrastructure,’ and they say, ‘There they go again. What the heck are those Democrats doing?’” 

“Now, if we’re saying, ‘I want to invest in the next generation of America’s children, and I want to do it by ensuring every kid goes to pre-K’ — like, that’s a different discussion, right?”  Spanberger stated. 

“I think this bill will make it over the finish line, but ultimately, this bill may not be identical to what we pass in the House when it does make it over the finish line.” 

Government officials also emphasized that the cost of not passing this bill will be much greater for lower to middle class Americans, who will be forced to deal with inflated costs for their everyday needs. 

“If we don’t act on Build Back Better … we won’t be able to cut child care costs. … We won’t be able to make preschool free for many families starting in 2022, saving many families $8,600. We won’t be able to get ahead of skyrocketing housing costs … and we won’t be able to save Americans thousands of dollars by negotiating prescription drug prices,” White House press secretary Jen Psaki said Friday. 

“So our view is this makes a strong case for moving forward with this agenda. Because what we’re really talking about is the cost to American families.”

Biden Working On $3 Trillion Package To Improve Infrastructure In America 

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President Joe Biden is working on assembling a new package of investments that would divide $3 trillion among the nation’s infrastructure and domestic needs throughout the next few years. Biden met with Senate Democrats privately this week to begin laying out the groundwork for improving the country’s roads, hospitals, and green energy systems. The investments will be part of Biden’s “Build Back Better” campaign promise. 

According to sources, this package will resemble the recent $1.9 trillion Covid-19 relief bill that the president just passed in that it will include family-friendly policies; for this package though the policies will focus on education and paid family leave. 

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A White House source claimed that the plans are still preliminary, but the overall goal is to use the money to help improve the nation’s economy and overall quality of life for every American. Senator Richard Blumenthal is just one of many Democrats who are prepared to move forward with the package should they be blocked by Republicans. “We need to get it done,” Blumenthal proclaimed. 

This package is also likely a response to the Biden Administration’s handling of the US-Mexico border and immigration in general; a topic that the administration is already under fire for due to a slew of migrant crossings and other failed promises brought on by Biden and his team. 

According to Yahoo News, “an infrastructure package would include roughly $1 trillion for roads, bridges, rail lines, electrical vehicle charging stations and the cellular network, among other items. 

“The goal would be to facilitate the shift to cleaner energy while improving economic competitiveness.”

“A second component would include investments in workers with free community college, universal pre-kindergarten and paid family leave. No part of the proposal has been finalized and the eventual details of any spending could change,” sources said. 

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House Speaker Nancy Pelosi asked Democratic committee chairmen earlier this month to “start working with their Republican counterparts to begin to craft a big, bold and transformational infrastructure package. The goal is to build swiftly on the coronavirus rescue plan to help people in every zip code by creating good-paying jobs for the future.” 

The Federal Reserve estimates that the spending with the Covid-19 relief bill and this infrastructure package could help the economy grow by up to 6.5%. Biden’s campaign also previously promised an increase on corporate taxes and for individuals making about $400,000 annually, which would also help the economy. 

The House Energy and Commerce Committee debated a $300 billion measure to invest in clean drinking water and broadband internet access this week while Transportation Secretary Pete Buttigieg is set to speak to the Transportation and Infrastructure Committee later this week. The Senate Finance Committee is also scheduled to meet and discuss tax spending as a means for paying for this package; all of these committee meetings have to do with the overall relief package the Biden Administration has been working on since last month. 

Biden is expected to release his budget in the coming weeks while Congress continues to discuss and meet regarding the details of this infrastructure package, which lawmakers claim could be ready by this summer.

Olympics

Want to Attend the 2020 Olympic Games? Here’s What You Should Know

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Next year, the Olympics are scheduled to be held in Tokyo, the first time the Olympics will be held in this city since 1964. Like all Olympic events, the 2020 Olympics are expected to be a massive tourism and economic opportunity for its host city, and over 11,000 athletes from 206 nations plan on participating. Millions of people from around the world have entered a lottery, hoping for the opportunity to buy tickets to the two-week event. The massive event, preparations for which are already well underway, is funded by a 400 billion Japanese yen fund set aside by the Tokyo Metropolitan Government, which is paying for the construction of massive venues and infrastructure, including a temporary “Olympic Village” where athletes live during the duration of the event.

The opening ceremony for the 2020 Olympics will take place in Tokyo, on July 24th, and preliminary soccer and softball matches begin July 22nd. A record 339 events in 50 sports will be held throughout the 2020 Olympics, with the sports of karate, climbing, surfing, and skateboarding appearing for the first time. Additionally, baseball and softball will make their debut in the 2020 Olympics, which is appropriate considering the massive popularity of these sports in Japan. Though most of the events will be held in Tokyo, a number of events will also be held in surrounding areas, including the Sapporo Dome on the island of Hokkaido and the Fukushima Azuma Baseball Stadium.

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A total of 7.8 million tickets will be sold, and even this number is insufficient to meet demand, as tickets have been sold via a lottery system, with most tickets being reserved for local fans. As such, it is difficult, yet still possible, to purchase tickets to the 2020 Olympics. Though all available tickets have already been sold, additional rounds of ticketing will occur throughout next year. Additionally, the Tokyo Olympics organizing committee will allow customers to resell their tickets, with the maximum ticket price being the original face value, to prevent scalping. If you miss out on getting tickets to the Olympics, there are other ways to enjoy the Olympics in and around Tokyo by attending so-called “Live Site” venues, where televised sports broadcasts will be featured and other programs will take place. 

Overall, travelling to Tokyo for the Olympics is sure to be an expensive, complex, and crowded operation, ideal for die-hard fans of Olympic sports but perhaps not for casual sports fans.

Owing to its massive size, security at the event will be strict. Drones are banned from flying over the events, and police have implemented facial recognition technology and other advanced surveillance technologies to combat the threat of terrorism and violence. Tokyo, fortunately, is considered one of the safest cities in the world, and has been relatively unaffected by violent extremism; however, the tremendous scale of the undertaking has raised concerns about cyberattacks and other threats to safety, including the possibility of a natural disaster, resulting in the implementation of security measures on an unprecedented scale. 

Additionally, the Olympic Committee has instituted a controversial policy of disallowing audio and video recordings made at the event from being posted to social media, and organizers are expected to rapidly issue takedown notices on social media networks for any violations. Photos, however, are allowed to be posted, but the intellectual property rights of photos taken at the event will be transferred to the Committee.

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Tokyo’s public transit system is sprawling and complex, a necessity to handle the city’s densely-packed population. This system will be put to the test during the Olympics, as the number of expected visitors far exceeds the system’s ordinary capacity. As such, Tokyo is making a tremendous investment in its public transportation infrastructure to handle the influx of tourists, but the system is complex enough that visitors are advised to perform extensive research about how best to navigate the city, using online tools like Hyperdia. 

Perhaps one of the greatest challenges for tourists, however, is affordable lodging. Prices for hotel rooms have skyrocketed, and the tiny “capsule” hotel rooms for which the city is well-known have quintupled in price during the Olympic season. Making matters worse, Japanese hotel rooms are small compared to those throughout most of the world, and under Japanese law, hotels charge per-person, not per-room. Other options include AirBnBs, which are gaining popularity in the country but nonetheless remain expensive, and cruise ships, which are set to function as “floating hotels” during the Olympic games.

Overall, travelling to Tokyo for the Olympics is sure to be an expensive, complex, and crowded operation, ideal for die-hard fans of Olympic sports but perhaps not for casual sports fans. For these people, attending local events where the Olympic games are rebroadcast and other activities are held can be a cheaper and less stressful way to enjoy this upcoming historic event.

Global Warming

Climate Change’s Present and Future Impact on Real Estate

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Already, climate change is having a serious impact on global political and economic systems, and as temperatures continue to rise, this impact will only become more severe. Climate change touches nearly all aspects of human life, as governments around the world grapple with the logistics of dealing with the problem, and powerful industries such as oil and gas struggle to adapt to changing attitudes and environments. Perhaps a less-expected area affected by climate change is real estate; as the sea level rises and weather patterns shift, some properties, particularly ones close to coastlines and beaches, are experiencing a decrease in valuation as their long-term viability is called into question, whereas properties in once-undesirable locations are becoming more popular. The reality of climate change has already taken hold in the real estate industry, as investors, landlords, and homeowners attempt to prepare for the often-unpredictable effects of the phenomenon.

Investors are wise to recognize that the problem of climate change is not going away; in fact, recent studies have revealed that the impact of climate change is likely to be even more significant than previously feared, with polar ice caps melting at an alarming rate and sea level rises now expected to displace 150 million people worldwide. Moreover, the increase in the frequency and intensity of extreme weather events brought about by higher global temperatures poses a threat to the integrity of real estate fixtures, and buildings constructed in vulnerable areas, without appropriate fortification, are at risk of collapse. Low- and moderate-income communities are at particular risk, as residents in these places are less likely to be able to afford dealing with the impacts of climate change, which at best causes property destruction and at worst can kill. 

Certainly, one of the factors in the real estate industry’s slow reaction to climate change is denial; oftentimes, the position that trends in the industry will continue as they always have is far more palatable than grappling with an unpredictable, substantial destructive force.

The Federal Reserve Board of San Fransisco recently published a collection of reports detailing the intersection of climate change and real estate. The organization warns that climate change could cause home values to fall significantly, could disincentivize banks from lending to affected communities, and towns and cities may not have the necessary resources to build sea walls and other infrastructure to protect against climate change. However, the reports also detail economic opportunities that could arise from climate change. Despite the breadth of scientific data available about climate change, the real estate industry has been slow to react, meaning plenty of investors could be caught off-guard by climate-related devaluations in their properties, whereas shrewd investors can take advantage of their understanding of climate change by investing in properties that will become popular as people relocate away from the coasts and areas where extreme weather events will be most prevalent.

A number of factors complicate the real estate industry’s response to climate change. One such factor is the nature of how flood insurance is calculated; despite the presence of more up-to-date data, calculations for the probability of floods occurring in particular locations are based on outdated maps and figures and don’t take into account rising sea levels. Additionally, the federal government subsidizes flood insurance programs, incentivizing developers to invest in coastal properties even though they are at increasingly-greater risk of destruction. Certainly, one of the factors in the real estate industry’s slow reaction to climate change is denial; oftentimes, the position that trends in the industry will continue as they always have is far more palatable than grappling with an unpredictable, substantial destructive force. As such, experts in the field are advising business leaders and other high-impact decision makers to adapt to a “new abnormal,” which involves taking a radically different and unprecedented approach to making real-estate choices, even when they may seem counter-intuitive to those who fail to consider the extent of climate change and its impacts.

Featured image credit: https://www.flickr.com/photos/thecvf/23054259530

Real Estate

How the Real Estate Landscape Will Change in 2020

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A widely anticipated industry report, entitled Emerging Trends in Real Estate 2020, was just released by the Urban Land Institute and Pwc. According to the report, while real estate economists’ views on economic growth in the US are moderate, the real estate market should remain steady through 2021. The conclusions of the report are based on a survey conducted in August of 41 economists and analysts at 32 leading real estate organizations, who, despite warning signs of an impending recession and an escalation of the U.S.-China trade war, were generally optimistic about the future of real estate.

That being said, the report stresses the importance of adaptability to change and discipline as necessary factors for the industry to be able to remain strong in the face of a possible economic downturn and potential decreases in real estate demand over the next few years. Although blame for the last major recession was placed in part on the real estate industry for reckless lending practices and fraudulent activity, the report suggests that a future recession wouldn’t be the fault of the real estate industry. Over the past ten years the property sector has become disciplined, the report says, and any warning signs about an economic dip relate to factors that the real estate industry does not control.

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According to the report, a dynamic perspective on real estate and a rethinking of growth strategies are necessary for the real estate industry to thrive, and real estate prospects are highest in the cities of Austin, Raleigh, Nashville, and Boston. As housing needs for Millennials and Baby Boomers continue to change, multifamily and single-family housing will be in increased demand, and office spaces, hotels, and retail locations are likely to see a decline.

The report also observes the effects of the housing affordability crisis, which has the most impact in cities where the cost of living is high, including Washington, D.C., Boston, Los Angeles, San Francisco, and San Jose. Affordability is a problem not only for low-income households, but for the middle class as well, a section of the population which is rapidly shrinking as greater numbers of people fall into economic uncertainty. The effects of this crisis mean that multi-family households and co-habitation arrangements are likely to increase in popularity, changing the market somewhat.

Additionally, the report talks about the effects of climate change on real estate, and specifically points to the impact of extreme heat in urban areas. Rises in temperatures mean that cooling apartment buildings will become more expensive, and the threat of wildfires, droughts, and air pollution pose economic problems. Climate change is not the only cause of rises in extreme heat, the report claims, as increased urban development also contributes to the problem. For handling the problem, the report recommends the use of light-colored building materials and smart use of direct cooling from shade.

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As a result of difficulties with affordability, co-living is on the rise, not only for younger generations but for older ones as well. Though the trend is caused in large part by worsening economic conditions for most people, the report highlights the social benefits of co-living, which helps to create a sense of community among people, particularly in an age where technology has the power to make people feel more isolated.

The report claims the lifestyle enjoyed by young people in cities is spreading to suburban areas, which increasingly feature nightlife opportunities, and incorporate transit access, walkability, and abundant options for retail, restaurants, and recreations. As Baby Boomers are expected to live longer and stay more active than previous generations have, the implications for housing are positive. And as communities increasingly recognize the threat posed by environmental damage, they are developing a commitment to environmental and social principles including sustainable engineering and design and socially conscious business practices. 

As the federal government fails to update the country’s infrastructure, some individual states have announced a commitment to doing so instead, making them a more attractive opportunity for the real estate industry and laying the foundation for economic growth. Finally, the report finds that technology is having a strong impact throughout all types of property, as consumers increasingly demand technological solutions for productivity and efficiency.