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.
Why OPEC Will Cut Production (Seeking Alpha) Hat tip to Marvin Clark. The author is confident enough in this prediction that he intends to put some money on it - investing in oil ETFs and solar stocks.
The Oil Industry Got Together and Agreed Things May Never Get Better (Bloomberg) The thousands of attendees seeking reasons for optimism didn't find them at the annual International Petroleum Week. Instead they were greeted by a cacophony of voices from some of the largest oil producers, refiners and traders delivering the same message: There are few reasons for optimism. The world is awash with oil. The market is overwhelmingly bearish. Econintersect: Is this a sign of capitulation at the bottom?
Pope meets Russian Orthodox head after 962 years (Al Jazeera) Church reconciliation and the welfare of Christians in Mideast and Africa were items on agenda during historic talks held in Cuba. The Vatican is hoping the meeting will improve relations with other Orthodox churches and spur progress in dialogue over theological differences that have divided East from West ever since the Great Schism of 1054 split Christianity.
Exclusive: Michigan Legionnaires' deaths were preventable, official says (CNN) Residents of Flint, Michigan, began getting gravely ill and in some cases dying in summer 2014 in one of the worst outbreaks of Legionnaires' disease in U.S. history, and a county health director says attempts to find the source were hampered when the state wouldn't request federal assistance. Genesee County Health director Jim Henry tells CNN in an exclusive interview he believes deaths could have been prevented, but the health department could not get help from the state of Michigan or the Centers for Disease Control to find the source. Eventually, 87 people got Legionnaire's and nine died.
Mortgage rates could cross a record low (CNBC) Who knew? The Federal Reserve raised its funds rate barely two months ago, and all that worry about higher interest rates for mortgage borrowers ended up being positively unwarranted. The average rate on the popular 30-year fixed mortgage began a free fall, reacting to financial markets overseas rather than monetary policy here at home.
"His issue is if you look at the financial crisis of 2008 and 2009, no one at the top has been brought to court or indicted. Compare that to this whole generation of African-American and Latino kids who are put in the jail system for having a little bit of pot. There's something wrong there. People need to be held accountable."
The Trouble With CoCos (Bloomberg) Until recently, many financial regulators thought a new financial instrument -- known as a contingent convertible bond -- had a big part to play in ensuring the soundness of the financial system. After the past few days, they might want to think again. CoCo bonds have been central to European regulators' efforts to avoid a repeat of the 2008 crisis. They're supposed to boost a bank's capacity to absorb losses. In times of stress, payments on CoCos can be halted, and the bonds can be converted into equity. Ideally, this makes it less likely that governments will have to rescue banks at taxpayer expense. That, in turn, should make banks more likely to issue equity in good times, and more prudent in their risk management. Since April 2013, European banks have issued more than $100 billion in a type of CoCos that count toward capital for regulatory purposes. The Bloomberg editorial board says:
The theory looked promising, but this week it didn't work so well. Investors worried that one of Europe's biggest financial institutions, Deutsche Bank AG, might be forced to miss a CoCo payment. This accelerated a broader selloff in the bonds and stocks of European banks. Deutsche Bank had to scramble to shore up confidence, in part by suggesting it might buy back some of its own debt.
The incident serves to reinforce concerns, expressed by various financial economists, that CoCo bonds may make investors in banks and their debt more apt to take flight when trouble looms. After all, if CoCos protect taxpayers, they do so at the expense of bank shareholders and bondholders. Moreover, CoCos are complicated instruments. In a time of stress, uncertainty over the conditions that trigger conversions may add to the sense of alarm.
Paradoxically, a panic of that kind might eventually call forth a government bailout -- the very thing that CoCos are intended to prevent.
Thousands of Iraqi refugees leave Finland voluntarily (Reuters) Thousands of Iraqi refugees who arrived in Finland last year have decided to cancel their asylum applications and to return home voluntarily, citing family issues and disappointment with life in the frosty Nordic country. Life in a country straddling the Arctic Circle is much different from Iraq where temperatures can reach above 120 degrees F.
Busting the myth of France's 35-hour workweek (BBC News) In the collective imagination, there are two Europes: the industrious north, with relatively low unemployment and dynamic economies, and the sluggish south, where people would just as soon kick back, sip an espresso and watch the world go by. Many people would lump France, the land of the 35-hour workweek, long lunches and even longer vacations, with the south. But anyone who has worked as a professional in the country knows otherwise. And for blue-collar workers 35 hours is merely the point at which overtime pay starts; for white-collar workers time above 35 hours in a week can be negotiated on a company-by-company basis for rest days. The average number of rest days in 2013 was 9.
Assad rejects war crimes charges, vows to retake all of Syria (Al Jazeera) Syrian President Bashar al-Assad has said his armed forces would try to retake the entire country "without hesitation", in an interview published after world powers agreed on a "cessation of hostilities". Speaking to the AFP news agency, Assad said the involvement of regional players in the conflict meant "that the solution will take a long time and will incur a heavy price".
Diplomats aim for temporary Syria truce in a week (Associated Press) A diplomatic push for a temporary pause in Syria's civil war and the delivery of humanitarian aid faced huge hurdles Friday, with Russia saying it would continue its airstrikes and government planes dropping leaflets urging rebels to surrender because "the belt is narrowing around you". A plan for the "cessation in violence" announced by the U.S. and Russia does not go into effect for a week, and while the Syrian opposition expressed "cautious optimism", it also said more innocent civilians would be killed in that span. Econintersect: Sounds like this is no truce plan at all.
Iran says ready to put rivalries aside with Saudi Arabia (Reuters) Iran and Saudi Arabia must overcome strained relations and work for stability in Syria and the Middle East, Iran's foreign minister said on Friday, a day after Syrian peace talks brought the rivals to the same table for the first time in months. Speaking at the Munich Security Conference hours after his Saudi counterpart addressed the event, Mohammed Javad Zarif said he wanted to stop the bickering and had a simple message: "We need to work together".
US deploys more Patriot missiles in South Korea (Associated Press) The United States temporarily deployed an additional Patriot missile battery in South Korea in response to North Korea's nuclear test and a long-range rocket launch, ahead of talks next week to set up an even more sophisticated U.S. missile defense in a move that has worried China and Russia. The new tough stance follows South Korea's decision to shut down an inter-Korean factory park that had been the rival Koreas' last major symbol of cooperation, but that Seoul said had been used by North Korea to fund its nuclear and missile programs. North Korea responded by deporting South Korean citizens, seizing South Korean assets and vowing to militarize the park. South Korea on Friday cut off power and water supplies to the industrial park and announced that its planned talks with the United States on deploying the Terminal High-Altitude Area Defense, or THAAD, one of the most advanced missile defense systems in the world, could start next week. Officials say they have yet to set a specific starting date for the talks.
Pentagon: North Korean special forces 'highly trained, well-equipped' (CNN) A new Pentagon report concludes that North Korea "is committed to developing a long-range, nuclear-armed missile that is capable of posing a direct threat to the United States". The report, required by law, updates Congress regularly on the status of and changes in North Korea's military capabilities. While the report, released Friday, was written prior to Pyongyang's recent nuclear test and satellite launch, it underscores the regime's devotion of large amounts of funding to modernizing its military forces and weapons arsenals. The report also singles out North Korea's Special Operations forces. It calls them "among the most highly trained, well-equipped, best fed and highly motivated" forces in North Korean leader Kim Jung Un's military.
Venezuela opposition to speed up plans to oust Maduro (BBC News) The new opposition-controlled National Assembly in Venezuela plans to speed up moves to oust the government of Nicolas Maduro as economic woes deepen. Parliament speaker Henry Ramos Allup said proposals would be presented in a matter of days - rather than months. A day earlier, President Maduro was given backing by the Supreme Court for a declaration of economic emergency, giving him greater powers. Venezuela is facing a shortage of many staple goods and rampant inflation. Its economy is heavily dependent on oil exports and has suffered substantially in the past year given the sharp fall in crude oil prices in international markets. Energy rationing has been imposed, blamed by government ministers on critically low water levels caused by drought at 18 of the country's hydro-electric dams.
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