Early Headlines: Chinese Stocks are Crashing, Al Qaeda Targets Hotel, Malaria Vaccine, TPP Final This Week, Trouble in Athens and More
Early Bird Headlines 27 July 2015
Econintersect: Here are some of the headlines we found to help you start your day. For more headlines see our afternoon feature for GEI members, What We Read Today, which has many more headlines and a number of article discussions to keep you abreast of what we have found interesting.
- TPP Trade Deal May Wrap Up This Week (Voice of America) The TPP (Trans Pacific Partnership) final draft may be completed this week. If completed, the TPP would cut tariffs and trade barriers among participants, something supporters say would boost economic growth. The TPP nations are Japan, Brunei, Malaysia, Vietnam, Singapore, Australia, New Zealand, Canada, Mexico, Chile, Peru, and the United States which together make up about 40 percent of the global economy. In the United States, critics of TPP include environmentalists, and unions who say the deal would do too little to protect human rights, the environment and U.S. jobs.
- Putin and Xi plot the future of Eurasia (Al Jazeera) Strengthening ties between Moscow and Beijing are tipping the world's balance of power eastward.
- Oil groups have shelved $200bn in new projects as low prices bite (Financial Times) The world's big energy groups have shelved $200 billion of spending on new projects in an urgent round of cost-cutting aimed at protecting investors' dividends as oil heads back below $50 for the second time this year. According to this article the cuts invovle deferral of projects that would have developed oil and gas projects with the equivalent of 20 billion barrels of oil in reserves. (That is more than the proven reserves of Mexico, FT says.)
- World's first malaria vaccine gets go-ahead from EU regulators (Reuters, CNBC) Hat tip to Marvin Clark. The world's first malaria vaccine got a green light on Friday from European drugs regulators who recommended it should be licensed for use in babies in Africa at risk of the mosquito-borne disease.
- Raising Floor for Minimum Wage Pushes Economy Into the Unknown (The New York Times) The fight for a $15 minimum wage has gained momentum in New York, California and other places around the country in recent months. But as a national strategy to raise incomes at the bottom of the pay scale, it faces major obstacles, both political and economic. But in many states there is little chance of raising the minimum wage above the federal level, currently $7.25 an hour. But the $15 an hour movement in some states represents more than a 100% increase from the federal level and could create a two-economy nation if the federal level remains at or near the present level.
- In defence of Germany: why the EU’s biggest champion doesn’t deserve the vitriol (The Conversation) This is a spirited defense of Germany's contributions to building a united Europe. But unfortunately it doesn't go deeper regarding Greece than to say the following and nothing further:
There are clearly grounds for criticising the current package offered to Greece, in particular, the absence of debt relief, and the proposed sale and privatisation of Greek assets will remind many people of the measures imposed on eastern Germany in the early 1990s, which led to mass unemployment.
- Greece bailout monitors question access to ministries (Financial Times) There are lots of problems in Athens. First, the EU and ECB monitors have been arguing with Greece for full access to all levels of government staff and facilities. Apparently, at least for now, Greece will only allow access to "only middle-ranking technical teams - and not mission chiefs". Second, last week the IMF (International Monetary Fund) scrapped its €28 billion bailout program that was originally to run until March. This was part of the €86 billion package for which Greece accepted an set of "reforms". The IMF says that debt restructuring is needed for them to participate - and the creditors don't want to hear of that. Third, the draconian reforms passed by Greece this month are now said to be insufficient. The creditors "insist that Greek authorities will have to legislate for more reforms - known as "prior actions", because these must be passed before aid is disbursed - to gain any payments under a new three-year bailout". See the next article for an opinion on where all this is headed.
- Why a Grexit Is Still Where the Greek Debt Crisis Is Headed (Keith Fitz-Gerald, Money Morning) Both Greek and European Union leaders are guilty of not only kicking the proverbial can down the road but doing so, according to former German Economic Minister Karl-Theodor zu Guttenberg, "up a hill and wondering why it keeps rolling back on its foot". EU politicians are fighting a Grexit for fear that Portugal and Spain would follow. But each time the "reforms" are advanced another notch the Greek debt rises an even bigger notch.
Greece needs it to re-establish sovereignty and rebuild what little growth the nation has available to it. The EU needs that to happen because the European Central Bank (ECB) cannot continue to establish a buffer against future catastrophes forever.
- Turkey calls for emergency NATO meeting to discuss security threats (Al Jazeera) Call to convene alliance members comes as Turkish military continues to strike PKK and ISIL targets in Iraq and Syria. Turkish action follows suicide bombings targeting Turks by members of both groups.
- Al-Shabab launches deadly attack on Mogadishu hotel (Al Jazeera) Al-Qaeda-linked group targets Jazeera hotel in Somalia's capital, killing at least 10 people and injuring many others.
- Mumbai Is Overflowing with Garbage (Bloomberg) Mumbai sits on a peninsula which makes every square foot of land extremely valuable. Even so, it currently discards 11,000 metric tons of refuse every day in three dump yards that together occupy more than 740 acres, nearly as large as New York City's Central Park. The land would be worth as much as $4.4 billion if it were sold and used for housing. Meanwhile, 6.5 million people, or half of Mumbai's population, live in slums without basic sanitation and safe drinking water.
- China stocks plunge, suffer biggest one-day loss since Feb 2007 (Reuters) So much for the great government rescue and stabilization program. China stocks plunged more than 8%, their biggest one-day drop in more than eight years, as a government-triggered rebound petered out amid profit-taking, concerns over economic health and fears of an end to Beijing's inclination toward looser monetary policies.
- Robots will help China remain the world's factory (China Spectator) Robots are invading Chinese factories in the Pearl River and Yangtze River deltas, the largest industrial hubs in the country. The International Federation of Robotics ays China became the world's largest market for robots in 2013, accounting for 20% of the world's total. The number of industrial robots grew by 36% a year for the six years ending in 2013.
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