Early Headlines: Who Runs the Fed?, Hacking Tesla, Predicting Euro Crisis, China Gov Has Trillions for Stocks and More
Early Bird Headlines 07 August 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.
- Blows for Obama as key lawmakers come out against Iran deal (Reuters) Chuck Schumer became the first democrat in the U.S. Senate to come out in opposition to the nuclear pact. Schumer, who is Jewish, was joined by another influential Jewish lawmaker who said on Thursday he also would oppose the treaty, House member Eliot Engel. Both have said they will vote 'yes' on a motion of disapproval. The president has said he will veto the motion should it pass.
- Who Runs the Fed? (Dissent) Hat tip to Doomstead Diner via Twitter. The author is professor of law and public finance at Nova Southeastern University's Shepard Broad College of Law in Fort Lauderdale, Florida. He traces the rapid impairment of the independence of the U.S. Federal Reserve since 2008. After about 5,000 words that are well worth reading, he concludes:
In the United States and elsewhere, the model of central bank independence is built on sand, propped up with trillions of dollars in market interventions designed and implemented by captured central banks. This central bank exception to democracy is not sustainable. It undermines broad-based economic well-being by concentrating power-and therefore wealth and income-in fewer and fewer hands. Any real progressive reform will require making the governing boards and policy-making committees of central banks genuinely inclusive to reflect a wider range of interests and to facilitate a wider discussion on the formulation of monetary policy. The longer reform is delayed, the longer we will have to live with huge redistributions of wealth and income from the many to the few, from Main Street to Wall Street.
- Tesla Model S Can Be Hacked, And Fixed (Which Is The Real News) (NPR) Two hackers, Kevin Mahaffey, a co-founder of Lookout and Marc Rogers, a principal security researcher with Cloudflare (both cybersecurity firms based in San Francisco) found a way to hack the Tesla Model S and take control of it. But Tesla designed the model S to receive software updates and the two hackers helped to company remove the bugs. Mahaffey and Rogers are what are known as "white hat hackers".
- An ‘unarmed’ white teen was shot dead by police. His family asks: Where is the outrage? (The Washington Post) A 19-year old was shot and killed in his car by police in South Carolina. His date, a 23-year old who was eating an ice cream cone at the time, was arrested and charged with possession of 10 ounces of marijuana. While blacks make up 13% of the population they suffer a disproportionate 25% of police fatal shootings, which has led to many protests around the country. In this case:
Police say the officer was a victim of "attempted murder" by Hammond, who was driving the vehicle. According to Seneca Police Chief John Covington, Hammond was driving the car "toward the officer" who was trying to make the stop.
- Nine People Who Saw the Greek Crisis Coming Years Before Everyone Else Did (Bloomberg Business) The nine people include Margaret Thatcher, Milton Friedman and four who have contributed to GEI.
- The man who discovered the ice age (BBC News) The glacier where the 'father of glaciology' Louis Agassiz took the first recorded measurements of glacial movements 170 years ago is fast receding and becoming marked with caves and sink holes.
- Can Putin Save Russia’s Struggling Companies? (Bloomberg) The Russian government and the central bank are pouring billions into the effort.
- The Irresistible China Trade That Keeps Burning Investors (Bloomberg Business) Buying Chinese shares through the Hong Kong market was supposed to be the big winning trade for 2015 in April - those shares were 25% cheaper than on mainland exchanges. But with the collapse of the mainland market the Hong Kong prices have also tumbled.
- Goldman estimates China’s ‘national team’ stock rescue at $144bn (Financial Times) China has spent $144 billion to bolster the country's fragile stock market since June, Goldman Sachs has estimated amid investor fears that authorities might run low on firepower to draw on should stocks resume their recent sharp descent. The figure is less than half of the roughly $322 billion war chest that the coalition of state financial institutions has at its disposal, the bank reckons. See also next article.
- China CSF Said to Seek $322 Billion More Funding to Boost Stocks (Bloomberg) The amount of money the Chinese government is putting into the stock market seems to be anyone's guess. This article indicates that $ 483 billion has already been committed (preceding article said $322 billion). This article claims that an additional $322 billion in addition is being sought by the government agency buying stocks, China Securities Finance Corp. That would bring the total to 5 trillion yuan renminbi (just over $800 billion).
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