{"id":16519,"date":"2016-01-15T20:36:21","date_gmt":"2016-01-16T01:36:21","guid":{"rendered":"http:\/\/olduvai.ca\/?p=16519"},"modified":"2016-01-15T20:37:19","modified_gmt":"2016-01-16T01:37:19","slug":"norway-pushes-panic-button-were-in-a-crisis-now-we-cant-deny-that","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=16519","title":{"rendered":"Norway Pushes Panic Button: “We’re In A Crisis Now, We Can’t Deny That”"},"content":{"rendered":"

Norway Pushes Panic Button: “We’re In A Crisis Now, We Can’t Deny That”\u00a0<\/a><\/h3>\n
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We\u2019ve spent quite a bit of time documenting Norway\u2019s precarious balancing act in the face of slumping crude prices.<\/p>\n

On the one hand, falling crude puts pressure on the krone which essentially allows the Norges Bank to compete in the regional currency wars without resorting to the same type of deeply negative rates as the ECB, the Riksbank, the Nationalbank, and the SNB. In short, a falling krone preserves export competitiveness in a world gone Keynesian crazy.<\/p>\n

At the same time, falling crude puts enormous pressure on the country\u2019s economy, which is heavily dependent on oil production<\/p>\n

Additionally, collapsing crude revenue means the country will soon be forced to drawdown its $830 billion sovereign wealth fund (the largest in the world) to plug the various budget leaks caused by \u201clower for longer.\u201d<\/p>\n

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Now, Norway has declared that its oil industry has entered a \u201ccrisis.\u201d<\/p>\n

\u201c[The] industry is in a crisis now, we can\u2019t deny that,\u201d<\/strong>\u00a0Bente Nyland, director general of the Norwegian Petroleum Directorate,\u00a0told Bloomberg<\/a>\u00a0who reminds us that \u201cNorway depends on oil and gas for about one-fifth of its economic output and nationwide,\u00a0the petroleum industry has cut almost 30,000 jobs.\u201d<\/strong><\/p>\n

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The government last year announced plans to boost spending on the way to shoring up the flagging economy and officials says those measures – which are part of the reason why Norway will pull money from the SWF – should be sufficient to offset the pain from lower crude prices. \u201cFinance Minister Siv Jensen says\u00a0budget proposals<\/a>\u00a0put forward last year already contain \u2018a lot of expansion\u2019 and will help stem job losses,\u201d Bloomberg continues, before noting that \u201cthe question is how quickly the economic adjustment brought on by a weaker krone will manifest itself.\u201d<\/p>\n

…click on the above link to read the rest of the article…<\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Norway Pushes Panic Button: “We’re In A Crisis Now, We Can’t Deny That”\u00a0 We\u2019ve spent quite a bit of time documenting Norway\u2019s precarious balancing act in the face of slumping crude prices. On the one hand, falling crude puts pressure on the krone which essentially allows the Norges Bank to compete in the regional currency […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[4333,11739,472,534,8019,1241,4318],"class_list":["post-16519","post","type-post","status-publish","format-standard","hentry","category-economics","tag-crude","tag-jensen","tag-krugman","tag-monetary-policy","tag-norges-bank","tag-norway","tag-zerohedge"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/16519","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=16519"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/16519\/revisions"}],"predecessor-version":[{"id":16521,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/16519\/revisions\/16521"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=16519"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=16519"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=16519"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}