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.
Asian shares, U.S. bond yields rise ahead of Fed rate decision (Reuters) Asian shares followed Wall Street higher on Wednesday, albeit in thin volume, and short-term U.S. bond yields held near 4 1/2-year highs as investors braced for the possibility of the first interest rate hike in the United States in almost a decade. European markets are poised to follow suit, with financial spread betters expecting Britain's FTSE 100 and France's CAC 40 to open up 0.3-0.4% and Germany's DAX 0.6 % higher. MSCI's broadest index of Asia-Pacific shares outside Japan rose 1.4%, while Japan's Nikkei gained 0.4%. China had a big up day - see article under China later below.
Cheap oil and strong dollar blot outlook for Fed hike(City A.M.) Manufacturing and the energy sector are contracting in the U.S. which weighs on the prospects for a Fed rate hike this week. But employment continues to improve and the same factors (strong dollar, cheap oil) holding back the two sectors above are "boosting the services sector, which is about seven times bigger than manufacturing". So the Fed rate decision is still in doubt. See also next article.
The Wall Street Journal Wants You To Be Afraid of Bernie Sanders' Budget Proposal. Don't Be. (In These Times) Hat tip to Doomstead Diner via Twitter. This is in response to an article in The Wall Street Journal discussed in 'What We Read Today' yesterday (and repeated below). This article gives a second estimate from the CBO (Congressional Budget Office) not mentioned by the WSJ: Without the Sanders program private health care costs 2016-2025 will be $28 trillion. The $15 trillion CBO estimate for Sanders single payer plan would largely offset the larger $28 trillion. That is a potentially big saving, Econintersect: But this is also a problem. If $15 trillion spent on universal health care removes the $28 trillion that would have been spent without it, $13 trillion is removed from the economy. How will that $13 trillion be spent, since it is a private sector net savings (applying the $15 trillion universal health care cost as a tax liability). If it amounts to a profit windfall for a few the economy might be better off with the more expensive health care where the money spent is spread over a bigger population segment. In other words, what policy can be implemented to assure that universal health care does not end up creating even more income inequality. (Does it upset you that we can find fault with the Sanders prpoposal and those that oppose it as well? Well, that's what thinkers do - devil's advocacy.) See also next article.
Price Tag of Bernie Sanders's Proposals: $18 Trillion (The Wall Street Journal) The Democratic presidential candidate's agenda would greatly expand government. In all, he backs at least $18 trillion in new spending over a decade, according to a tally by The Wall Street Journal, a sum that alarms conservatives and gives even many Democrats pause. Mr. Sanders sees the money as going to essential government services at a time of increasing strain on the middle class. His agenda includes an estimated $15 trillion for a government-run health-care program that covers every American, plus large sums to rebuild roads and bridges, expand Social Security and make tuition free at public colleges. So far he has proposed tax increases that pay for slightly more than 1/3 of the spending. Econintersect: This article does not address any benefits to the economy? Can any be postulated? Is the proposal to spend $18 trillion and get no return? Note:This story also appears at MSN Money.
US arms maker markets Christian-themed assault rifle (AFP, MSN Money) An arms maker in Florida is engraving Christian symbols on its assault rifles, in a marketing ploy denounced by a Muslim group as fomenting "hatred, division and violence." The "Cruzado" assault rifle is inscribed with the cross of the Knights Templar, a religious order that fought in the Crusades, and a psalm from the Bible -- features that its maker, Spike's Tactical, says are intended to keep the weapons out of Muslim hands.
Migrant crisis: Dozens head for Croatia as Hungary border sealed (BBC News) The first group of migrants has reached Serbia's border with Croatia - a new route into the European Union. Buses took the migrants towards the town of Sid, after Hungary closed the border with Serbia, stranding thousands attempting to reach Germany - final destination for many. Croatia has said it will not "just allow people to move through".
How Merkel Went From Greek Crisis Pariah to Refugee Crisis Hero (Bloomberg) It was when the numbers became faces that German Chancellor Angela Merkel made a decision that could make or break her political legacy. As she toured a refugee center in the eastern German town of Heidenau on Aug. 26, hearing stories from Syrians about traumatic journeys to flee their civil war, protesters against their arrival jeered and shouted abuse. Some called her a "traitor to the nation". The experience left her shaken but determined to act, according to two close Merkel aides.
China Stocks Surge in Last Hour of Trading to Halt Two-Day Slide (Bloomberg) China's stocks surged in the last hour of trading to head for the steepest gain since 2009 as technology shares led a rebound for companies that had been beaten down the most during a $5 trillion rout. The Shanghai Composite Index jumped 5.9% to 3,180.88 at 2:47 p.m. Only seven out of the more than 1,100 stocks in the benchmark gauge fell. However, volume was extremely thin, slumping 48% below the 30-day average.
Asia's Best Refuge From China Crash Is Just Next Door in Taiwan (Bloomberg) The best refuge from the Asian emerging market crash triggered by China's slowdown is right next door in Taiwan. Global funds boosted holdings of the island's equities this month, while pulling money from securities in South Korea, India, Indonesia and Thailand, exchange data show.
'Other disappeared' leave gaping holes in Mexico's fabric (Associated Press) At least 292 people have been added to the list of missing from the Iguala area since the 43 students disappeared there on Sept. 26, 2014. But that pales in comparison to the 25,000 people who have disappeared since 2007 from this region of about 300,000 residents 110 miles south of Mexico City.
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