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 near two-week highs, oil tries to rally (Reuters) Asia shares pushed ahead on Wednesday following a rally on Wall Street, while major currencies entered a holiday lull and oil strove to sustain a modest bounce from multi-year lows. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS firmed 0.6% to the highest in almost two weeks. Australia's main index rose 0.5%, while South Korea .KS11 added 0.3%. For European markets, IG tipped an opening gain of 51 points for Britain's FTSE 100 .FTSE, 83 points for Germany's DAX .GDAXI and 35 points for France's CAC 40 .FCHI.
Bonds set to beat stocks globally in 2015 after China falters (The Business Times) Bonds are poised to outperform stocks globally for a second year, the first time that has happened in more than a decade, as slowing growth in China drives demand for the safest assets. The Global Broad Market Index of bonds from Bank of America Merrill Lynch has risen 1.3% this year, while the MSCI All Country World Index of shares has slumped 3.1% including reinvested dividends. In 2014, debt returned 7.8% and stocks advanced 4.8%. Bonds haven't outperformed equities for two straight years since 2001 and 2002 when a bubble in technology shares burst. Even in the U.S benchmark Treasuries have gained this year in spite of the Federal Reserve raising interest rates.
Cord cutting spreading from TV to Internet service (Yahoo Finance) Fewer homes subscribe to broadband Internet service than they did two years ago, according to a new survey, the first sign that the cord-cutting phenomenon that has plagued cable television may be spreading. Meanwhile, smartphone ownership continued to expand, as more people are relying solely on mobile Internet connections. But even for cellular the growth is slowing.
Bowe Bergdahl arraigned at North Carolina Army base (Associated Press) Sgt. Bowe Bergdahl, who was held by the Taliban for five years after he walked off a base, was arraigned during a short hearing on charges of desertion and misbehavior before the enemy, a relatively rare charge that carries the severe punishment. If convicted of desertion, he could get up to five years in prison.
Musk Greets SpaceX Reusable Rocket With 'Welcome Back, Baby' (Bloomberg) Elon Musk's SpaceX showcased his dream of reusable spacecraft by making a Falcon 9 booster the first piece of an orbital rocket to land back on Earth minutes after lofting satellites toward orbit. Space Exploration Technologies Corp. pulled off the soft, vertical touchdown after the two-stage rocket propelled its payload of 11 Orbcomm Inc. satellites aloft. It was the company's first flight since a fiery blast destroyed a Falcon 9 rocket in June, minutes after lift off. See also GEI Video of the Day.
Happy Christmas, the War Is Over, at Least for Draghi and Euro (Bloomberg) The euro dropped to the $1.05 - $1.06 region twice this years and recovered back to $1.10 and higher both times. After European Central Bank President Mario Draghi extended monetary stimulus, strategists have come to the conclusion he's done enough to revive the economy with policies that helped push the euro down about 10% versus the dollar this year if it ends the years somewhere near $1.10. This followed a 12% decline in 2014 and has analysts consensus for a muted 4% declin in 2016.
Deutsche Bank Tally of Suspect Russia Trades at $10 Billion (Bloomberg) Deutsche Bank AG has identified as much as $4 billion in suspicious transactions related to its Russian operations, in addition to $6 billion in so-called mirror trades it is examining, said several people with knowledge of the bank's review of the matter. That means the Frankfurt-based bank flagged as much as $10 billion in total trades that may not have been vetted for money laundering as clients moved money out of Russia.
Assad can stay, for now: Kerry accepts Russian stance (Associated Press) U.S. Secretary of State John Kerry on Tuesday accepted Russia's long-standing demand that President Bashar Assad's future be determined by his own people, as Washington and Moscow edged toward putting aside years of disagreement over how to end Syria's civil war.
Islamic State conflict: Iraqi forces 'move into Ramadi' (BBC News) Iraqi forces are advancing into the centre of Ramadi, after launching a major assault to drive Islamic State (IS) militants from the city, officials say. Security sources told the BBC troops and allied tribesmen, backed by US-led air strikes, had already retaken two districts, and entered two others. They are heading towards the main government complex, and have come up against snipers and suicide bombers. Ramadi fell to IS in May in an embarrassing defeat for the Iraqi army.
The Latest: Putin hopes for punishment of Nemtsov assassins (Associated Press) President Vladiimir Putin says that those who killed Russian opposition leader Boris Nemtsov must be tracked down and punished. Toward the end of a news conference that lasted 3 hours and 10 minutes, Putin said he personally knew Nemtsov, a former deputy prime minister who was gunned down on a bridge near the Kremlin. The Russian leader says that he had not discussed the issue with the leadership of the province of Chechnya, whose residents have been detained on suspicion of involvement in the crime, but added that no one would be immune from prosecution. Nemtsov had publicly opposed the policies of the Putin government.
Indian economy: Interesting mid-year signals (The Economic Times) India's real GDP growth appears to have moderated to 7.2% annual rate, down from 7.5% in the previous fiscal year. The CPI (Consumer Price Index) inflation has moderated to 5% in October 2015 compared to 5.4% in February 2015. Similarly, the WPI (Wholesale Price Index) has been in the negative territory since November 2014 and was pegged in October 2015 at -3.8%t. The fiscal deficit target is pegged at 3.9% of GDP.
Overseas Chinese banks hoard amid yuan crunch (Taipei Times) Chinese banks from Hong Kong to London are selling a record amount of yuan-denominated certificates of deposit (CD) as China takes steps to curb outflows of the currency. Sales jumped to an unprecedented 66.1 billion yuan (US$10.2 billion) this month, data compiled by Bloomberg show.
Unaccountable China (Project Syndicate) Hat tip to Rob Carter. This is a good presentation of the situation in the South China Sea with China building and fortifying artificial islands within the 200 mile economic interest zone of the Philippines (near the Spratly Islands - see map below). The author, Brahma Chellaney, Professor of Strategic Studies at the New Delhi-based Center for Policy Research and Fellow at the Robert Bosch Academy in Berlin, is very critical of the inaction of the U.S. in this matter.
Dying Pakistani student's family denied Australia visa (BBC News) Australian authorities have refused to grant a visa to the family of a Pakistani student dying of skin cancer. Hassan Asif, 25, is in the final stages of his life and unable to fly home to Pakistan because he is too sick. Mr Asif came to Australia to study architecture, but was diagnosed with terminal skin cancer in July. "I'm dying and it's really hard because of the pain. In these circumstances everybody would like to be with family", Mr Asif told Network Ten. "My mum is always crying about it, always hoping that they will get the visa this time." The immigration department said in a statement that the family's current application would not be reviewed. But the statement said that Mr Asif's family was welcome to lodge new applications. Econintersect: The Circumlocution Office lives on in Oz.
More Bad News for the Canadian Dollar? (Profit Confidential) the Canadian dollar (the Loonie) is in real trouble. After months of edging lower and lower, the CAD to USD exchange rate looks like it's going to break sometime in 2016. Here's where this source says it could be headed. The proposition here is that the U.S. economy is strengthening while Canada is weakening. This article suggest that the Loonie could repeat it's 20% decline of 2015 and that would put it at $0.57 U.S. The value is customarily plotted as the inverse and 0.57 is the inverse of 1.75. That is a level for the Loonie that has never been seen in modern history. See graphic below - the lowest for the Loonie since 1972 has been around $0.62 U.S. shortly after the turn of the century.
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