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 stocks hit three-week lows on oil drop; Fed eyed (Reuters) Asian stocks hit three-week lows on Tuesday as a rout in oil prices knocked energy company shares lower and many investors moved to the sidelines before next week's meeting where the Federal Reserve is expected to raise U.S. interest rates. In spite of Asia's weakness, financial spreadbetters expect Britain's FTSE 100 .FTSE index to open 0.2% higher, Germany's DAX .GDAXI to rise 0.2% and France's CAC 40 .FCHI to edge 0.15% higher. Stock markets across Asia-Pacific were down. The MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was off 1.5%, erasing gains made earlier this month, with Hong Kong shares .HSI leading declines with a fall of 1.9%.
OPEC's Oil Market Disarray Looks Like 1990s Slump All Over Again (Bloomberg) OPEC has seemingly dropped any attempt at trying to fulfill its founding mission and manage the oil market, sending global benchmark Brent crude to a six-year low. For Saudi Arabia's Ali al-Naimi, the most powerful and longest-serving of the group's oil ministers, it may have seemed like history was repeating itself. There are several striking parallels between the Organization of Petroleum Exporting Countries' current situation and the period from 1997 to 1999, when the group lost control of the market and oil slipped to less than $10 a barrel.
Emerging market sell-off unlikely in case of US Fed hike: analysts (The Business Standard) Even as the world gears up for the expected Fed rate hike next week, analysts say most financial markets are already factoring in a 25 basis point (bps) hike. Despite volatility, pre and post the Fed outcome, they rule out any massive sell-off in emerging market equities, especially India.
This 3-minute animation will change your perception of time (Business Insider) The Earth is really, really old. Over 4 1/2 billion years old, in fact. How do we begin to comprehend a number that large? It helps to put it on a more fathomable scale. Watch to see where Earth's major events would fall on a timeline stretching across the US.
U.S. Agent Gets Six Years Prison for Silk Road Bitcoin Theft (Bloomberg) A government agent who stole $820,000 in bitcoins while investigating an online drug emporium was sentenced Monday to almost six years in prison after a prosecutor said his deceit amounts to a "breathtaking abuse of trust." Shaun Bridges, who worked for the Secret Service, hijacked the account of an administrator for the Silk Road black market website to syphon off bitcoins.
Pictures of 'The Trellis' - a new building that will be the tallest in the City of London (Business Insider) The City of London could be about to get a new tallest building, if new plans revealed on Monday go ahead. The plans, released by architect Eric Parry, are to create a huge new skyscraper at One Undershaft, right in the heart of London's insurance district. The new tower, which will be built by Singaporean developer Aroland Holdings, will be 303.6m tall when it tops out, comprising 73 storeys and 90,000 square metres of space. It will accommodate 10,000 people.
How Refugees Find Jobs in Germany (The New Yorker) Thanks to federal, state, and grass-roots or volunteer-run programs, thousands of asylum seekers are now on their way to integrating into the German economy, but whether this can be accomplished on the scale of hundreds of thousands is another matter. The refugees represent the largest influx of potential labor to Germany since the nineteen-sixties and seventies, when a Turkish guest-worker program brought in millions of immigrants, many of whom settled down and raised families. For decades politicians resisted efforts to permanently integrate them, and today Turkish residents are more likely than other immigrant groups to be poorly educated, underpaid, and unemployed. Will Germany do better with the new wave of migrants? They had better try - the country desperately needs them. The country is facing a serious demographic challenge as the population ages. See next article.
Germany's Population by 2050 (German Federal Statistics Office) Germany's population is declining after peaking just after the turn of the century. Current projections have Germany's population declining from the peak by at least 10% and possibly as much as 18%.
Defiant Alexis Tsipras insists coalition will pass reforms (Financial Times) Alexis Tsipras has insisted his fragile coalition will prevail in tough negotiations with Greece's creditors over pension reform, and dismissed suggestions he will have to seek backing from pro-European opposition parties in Athens to stay in power. The prime minister talked for the first time since the September election in a 90-minute live interview. After that election his leftwing Syriza party won a second term at a general election and unexpectedly chose to govern with the small rightwing Independent Greeks party.
Russia and radicalisation: Homegrown problem (Financial Times) Moscow seeks to prevent the war in Syria from fuelling its Islamist insurgency in the North Caucasus. Even though Moscow won the war in Chechnya, an Islamist underground continues to exist, and young men continue to join up, or, as the locals say, "go into the forest".
Yen Embraced by U.S. Banks as Heir Apparent to Dollar's Throne (Bloomberg) Analysts think the yen will be stronger than the U.S. dollar in 2016. After its steepest losing streak on record, Japan's yen is poised to seize the crown of best-performing major currency from the dollar in 2016, according to two of the biggest U.S. investment banks. JPMorgan Chase & Co. and Morgan Stanley predict Japan's currency will outstrip all its peers next year, halting a 40 percent decline over the past four years versus the greenback. The nation's growing current-account surplus is blunting the Bank of Japan's ability to weaken the exchange rate through monetary stimulus, and the government will increasingly rely on spending and reforms to boost the economy instead, they say.
Rupee outlook: Manageable downside risk from US Fed policy action (The Business Standard) The rupee has been one of the better performing emerging market (EM) currencies in 2015. Most EM currencies saw significant depreciation this year: Brazilian real (- 45%), Turkish lira (- 24%) and Russian rouble (- 10%), whereas the rupee fell only 5.6%. This reflects the strong growth in GDP and should bode well for relative rupee strength when the Fed raises rates.
Deflation might disturb Finance Minister Jaitley's fiscal math (The Business Standard) Finance Minister Arun Jaitley's confidence in meeting the fiscal deficit target for 2015-16 faces a challenge from an unexpected quarter - a significantly lower nominal growth rate in gross domestic product or GDP compared to earlier estimates. Real GDP growth is measured on constant prices (excluding the impact of inflation or deflation), while nominal GDP growth includes the impact of a change in prices. In a significant decline in prices, as in the first half of 2015-16 because of a fall in those of crude oil, the economy's nominal size is likely to grow at a lower rate than earlier estimates and can be the same or less than the real growth in the economy at constant prices. This impacts the fiscal ratios, since these are based on the nominal size of the economy or nominal GDP
China Credit Risk Seen Rising as Slowing Economy Inflates Yields (Bloomberg) China's corporate bonds will face increased pressure in 2016, with a rising number of failures and a worsening economy pushing up yields and credit premiums, according to some of the nation's top brokerages. The nation saw its first-ever onshore bond default last year, there have already been seven more failures in 2015.
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