Economy Watch: World Economic Forum: Income Disparity Top Risk; Residential Foreclosures Dropping in California
- Jan 22, 2014
The World Economic Forum, best known for its annual meeting of the world’s economic panjandrums – which begins on Wednesday at Davos, Switzerland – also generates reports, the latest of which was released in time for the high-level conference: “Global Risks 2014.” The report analyses 31 global risks grouped under five categories – economic, environmental, geopolitical, societal, and technological – and measured in terms of their likelihood and potential impact.
The chronic gap between the incomes of the richest and poorest people is the risk that’s most likely to cause serious damage globally in the coming decade, according to the 700-plus global experts that contributed to “Global Risks 2014.” After income disparity, the experts see extreme weather events as the risk next most likely to cause systemic shock on a global scale. Then comes unemployment and underemployment, climate change, and cyberattacks.
“Each risk considered in this report holds the potential for failure on a global scale; however, it is their interconnected nature that makes their negative implications so pronounced as together they can have an augmented effect,” Jennifer Blanke, chief economist at the World Economic Forum, said in a statement.“It is vitally important that stakeholders work together to address and adapt to the presence of global risks in our world today.”
Residential Foreclosures Dropping Fast in California
The number of California residential properties pulled into the formal foreclosure process dropped to an eight-year low last quarter, the result of an improving economy, foreclosure prevention efforts and higher home prices, DataQuick reported on Tuesday. As a bellwether housing market, California is generally worth watching – and recently has been recovering at a strong pace.
A total of 18,120 Notices of Default were recorded by lenders and their servicers on California houses and condos during the fourth quarter of 2013, according to the real estate information service. That was down 10.8 percent from the previous quarter, and down 52.6 percent from the fourth quarter of 2012. In fact, last quarter’s tally was the lowest since the fourth quarter of 2005. Notices of Default peaked in first-quarter 2009 at 135,431.
“Some of this decline in foreclosure starts stems from the use of various foreclosure prevention efforts — short sales, loan modifications and the ability of some underwater homeowners to refinance,” John Walsh, DataQuick president, noted in a statement. “But most of the drop is because of the improving economy and the increase in home values. Fewer people are behind on their mortgage payments. And of those who do get into trouble, many, if not most, can sell and pay off what they owe.”
Wall Street ended the day mixed on Tuesday, with the Dow Jones Industrial Average losing 44.12 points, or 0.27 percent. The S&P 500 and the Nasdaq, however, were both up, by 0.28 percent and 0.67 percent, respectively.