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Rep. Lee Gang-ill of the main opposition Democratic Party of Korea released data from the Financial Supervisory Service, revealing that 65,887 people in their 20s were registered as credit delinquents with the Korea Credit Information Services (KCIS) as of July.

This represents an increase of 25.3 percent in the number of credit delinquents among people in their 20s compared 2021.

Considering that the total number of credit delinquents increased by around 8 percent from 548,730 to 592,567 during the same period, the increase among those in their 20s is even more pronounced.

A credit delinquent is registered with the KCIS when their overdue period exceeds a specified timeframe — three months past the loan's maturity or six months past the due date. These individuals face various financial disadvantages, including the suspension of their credit cards, restrictions on taking out loans, and a drop in their credit ratings.

A notable characteristic of youth debt is the large number of borrowers struggling to repay loans that are under 10 million won ($7,400).

As of July, 73,379 people in their 20s were registered with credit bureaus for short-term delinquencies, excluding credit card payment issues. Among them, 64,624, or 88.1 percent, owed less than 10 million won. This indicates that nearly nine out of ten loan delinquents in their 20s have relatively small amounts of debt.

Rep. Lee noted, that given that the delinquent amounts are relatively small, a significant number of young people seem to be struggling with living expenses or housing costs. He raised concerns that the younger generation is facing economic hardships from high interest rates and inflation, along with difficulties in securing stable jobs due to the economic slowdown.

According to government data, the number of employed individuals aged 15 to 29 has been decreasing annually since November 2022.

In July, the number of young people who were neither employed nor seeking employment reached 443,000.

“Amid the economic slowdown, the reduction in new jobs for people in their 20s has resulted in small loan delinquencies, highlighting the financial difficulties young people face,” Lee said.

“Addressing youth delinquency through financial solutions like debt restructuring alone seems to be insufficient. Comprehensive youth policies, including job creation and broader social policies, must be implemented at the macro level.”

Source: Koreatimes

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Conclusion

Sales of Malaysia’s wholesale and retail trade rose 6.7% year-on-year (y-o-y) to RM149 billion in July 2024, according to the Department of Statistics Malaysia (DOSM).

Chief statistician Datuk Seri Dr Mohd Uzir Mahidin said that retail trade grew 6.4% to record RM63.5 billion sales for the month.

“Wholesale trade also went up 5.5% to record RM66.6 billion, followed by motor vehicles with an increase of 12.2% to RM19.0 billion,” he said in a statement on Monday.

On a month-on-month (m-o-m) basis, wholesale and retail trade rebounded 2.1% after dipping 1.3% in June, bolstered by motor vehicle sales which increased 11.6%.

The department said the retail trade sub-sector’s y-o-y growth was led by retail sales in non-specialised stores, which grew 7.7% to RM24.4 billion, while the wholesale trade sub-sector’s y-o-y growth was supported by wholesale of machinery, equipment and supplies, which rose 10.2% to RM5.4 billion.

Meanwhile, the 12.2% y-o-y growth for the motor vehicles sub-sector was driven by the sales of motor vehicles, which recorded a double-digit growth of 14.0%, it said.

For the index of retail sale over the internet, the department said the index grew 5.7% y-o-y in July 2024, compared to 4.8% y-o-y in June 2024. For the seasonally adjusted value, the index inched up 1.5% against the previous month.

In terms of the volume index, DOSM said wholesale and retail trade for July 2024 registered a y-o-y growth of 5.5%, contributed by all sub-sectors, namely motor vehicles (10.8%), wholesale trade (5.2%) and retail trade (4.6%).

“For the seasonally adjusted volume index, it went up 2.1% m-o-m (month-on-month),” it said.

The department noted that the government has declared Oct 20 of each year as the National Statistics Day (MyStats Day), and that this year’s theme is “Statistics is the Essence of Life”.

Source: Theedgemarkets

The rate of cryptocurrency ownership isn’t growing in tandem with the recent resurgence in the crypto market, according to United States Federal Reserve research.

“Recent growth in the [crypto] market has not been accompanied by an increase in ownership in our survey population,” the Federal Reserve Bank of Philadelphia’s Consumer Finance Institute (CFI) said in a Sept. 6 report.

The CFI collected data on cryptocurrency ownership through surveys between January 2022 and July 2024 using the price of Bitcoin (BTC) as a proxy to determine that the depths of crypto winter occurred in late 2022.

It found crypto ownership decreased during the 2022 crypto winter bear market, with ownership rates falling from 24.6% of the surveyed population in January 2022 to 19.1% in October 2022.

However, despite the market recovery over the following 18 months, ownership rates did not correspondingly increase with just 17.1% of those surveyed owning crypto in October 2023, which dropped to 15.4% in January 2024.

The CFI report found that there was no significant increase in ownership around Bitcoin’s March price peak and its April halving, with ownership rates at 16.1% in April and dropping to 14.7% two months later in July.

Bitcoin’s price compared to surveyed crypto ownership rates: Source: Federal Reserve Bank of Philadelphia

The Fed researchers noted that this year’s price increases do “seem to correspond to an increase in the percentage of respondents who are likely to purchase crypto in the future.”

Interest in future crypto purchases declined during the 2022 crypto winter from 18.8% to 10.6% of all respondents.

As the market recovered, interest increased significantly with 21.8% of all respondents stating they were likely to purchase crypto in the future by April 2024.

The Fed surveys were collected from two different web-based surveys targeting 5,000 nationally representative responses.

Crypto markets have gained almost 150% since the beginning of 2023, despite the market downtrend since mid-March.

In May, the Fed reported a survey of over 11,000 respondents found crypto ownership or usage was around 18 million people in the United States in 2023, a lower figure compared to Coinbase’s September 2023 finding that 52 million Americans owned crypto.

Source: COINTELEGRAPH

Former European Central Bank (ECB) president Mario Draghi called on the EU to invest as much as €800 billion (RM3.86 trillion) extra a year to make the bloc more competitive and to commit to the regular issuance of common bonds to compete with China and the US.

In his long-awaited report on European Union (EU) competitiveness, Draghi urged the bloc to develop its advanced technologies, create a plan to meet its climate targets and boost defence and security of critical raw materials, labelling the task “an existential challenge”.

Draghi said that Europe will need to boost investment by about five percentage points of the bloc’s gross domestic product — a level not seen in more than 50 years — in order to transform its economy so that it can remain competitive. He warned that EU economic growth was “persistently slower” than in the US, calling into question the bloc’s ability to digitalise and decarbonise the economy quickly enough to be able to rival its competitors to the east and west.

“If Europe cannot become more productive, we will be forced to choose. We will not be able to become, at once, a leader in new technologies, a beacon of climate responsibility and an independent player on the world stage,” he wrote in the report. “We will have to scale back some, if not all, of our ambitions.”

European Commission President Ursula von der Leyen, who tasked Draghi with delivering the report, will need to decide how much of his recommendations to pursue.

The report comes as European leaders are increasingly aware of the loss of competitiveness against the bloc’s main rivals, partly due to Europe’s energy dependency and lack of raw materials. Meanwhile the EU continues to be hampered by the inability of its telecom and defence industries to harness economies of scale and be better prepared for a more nimble security stance.

The EU has also failed so far to push forward on a roadmap to lower the barriers of its capital markets to mobilise billions of euros across its borders needed to accelerate the development of clean technologies to meet its ambitious green targets or to create the next generation of technology champions.

One particular blessing for the private sector was Draghi’s call for more consolidation in the telecom industry, which he said is “needed to deliver higher rates of investment in connectivity”.

Draghi also pitched an adaptation of the EU’s competition policy so that “it does not become a barrier” to the bloc’s industrial goals. Specifically, he called for new assessments in tech deals that would examine how certain deals could boost innovation in Europe, as well as a further loosening of the EU’s guardrails for state aid across strategically important sectors.

The malaise of the European productivity is augmented by the weakness of national governments in the largest EU economies hit by political fragmentation and the rise of populist forces against some of the ambitious common solutions that Draghi is calling for, including joint debt.

The consequences of the slow response to the challenges posed by American financial incentives for the green transition and China’s aggressive industrial plans, with billions of dollars invested in subsidies, are already felt in some of the key industries.

Volkswagen AG announced that it’s considering factory closures in Germany for the first time in its 87-year history.

“Europeans need to understand that defence is not an answer, it’s just a temporary answer,” Alicia Garcia Herrero, economist at Natixis, speaking to Guy Johnson and Kriti Gupta on Bloomberg TV. “We need to attack — meaning certainly not anything but compete on better terms, meaning more innovation. The single market has to be strengthened.”

Draghi laid bare the challenges facing EU industry as it embarks on its mission to reach net zero by the middle of the century. Energy prices in the region are too high and are holding back investments, while the bloc’s climate goals are placing a heavy short-term burden on the highest-emitting sectors. China and the US do not face such obstacles, while the level of finance they provide to the sector dwarfs that of the EU.

Energy plans

To make the energy transition an opportunity, Europe needs to sync all its policies with climate goals and come up with a joint plan for decarbonisation and competitiveness that would span energy producers, clean tech and automotive sectors as well as energy-intensive companies where emissions are hard to abate.

The four largest emission-intensive industries in the EU, such as chemicals and metals, will require €500 billion over the next 15 years in order to decarbonise, Draghi’s report said. On top of that transport investment will amount to €100 billion every year between 2031 and 2050.

Draghi drew on the automotive sector for particular scorn, calling it a “key example of a lack of EU planning”. The bloc faces a real risk that EU carmakers continue to lose market share to China, which has is ahead of the 27-member bloc in “virtually all domains”, while producing at a lower cost.

The report suggests common funding for defence R&D in a number of sectors such as drones, hypersonic missiles, directed-energy weapons, defence artificial intelligence and seabed and space warfare, but also the space sector. He also recommends ramping up collaborative procurement on defence equipment as well as favouring European companies, provided they are competitive.

Source: Theedgemarkets