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.
Oil prices fall as investors cash in on gains at week's end (MarketWatch) Crude oil prices edged lower in early Asian trade Friday as traders booked profits following the overnight rise, underpinned by market anxiety that the global glut is shrinking at a slower rate than expected. On the New York Mercantile Exchange, light, sweet crude futures for delivery in August CLQ6, -0.66% at $45.54 a barrel, down $0.34, or 0.7%, in the Globex electronic session. September Brent crude on LCOU6, -0.65% ICE Futures exchange fell $0.36, or 0.8%, to $47.01 a barrel.
Trump postpones VP announcement, citing France attacks (Associated Press) Donald Trump abruptly postponed plans to announce his vice presidential pick following a day of rampant speculation, citing the "horrible attack" in Nice, France, that left scores dead. Trump had planned to hold his first event with his yet-to-be-named running mate Friday morning in New York. He announced the change of plans Thursday evening on Twitter. The stunning announcement raised questions about the status of Trump's selection process. Indiana Gov. Mike Pence had emerged as a late favorite for the job, though Trump said he had not finalized the pick and advisers cautioned he could change his mind.
New Concentrating Solar Tower Is Worth Its Salt with 24/7 Power (Scientific Amnerican) Deep in the Nevada desert, halfway between Las Vegas and Reno, a lone white tower stands 195 meters tall, gleaming like a beacon. It is surrounded by more than 10,000 billboard-size mirrors focusing the sun's rays on its tip. The Crescent Dunes "concentrating solar power" plant looks like some advanced communication device for aliens. But the facility's innovation lies in the fact that it can store electricity and make it available on demand any time - day or night. The facility is touted as being the first solar power plant that can store more than 10 hours of electricity, which translates into 1,100 megawatt-hours, enough to power 75,000 homes. "We can ramp up electricity generation for utilities based on the demand. We can turn on when they want us to turn on and we can turn off when they want us to turn off," SolarReserve CEO Kevin Smith says. The cost of producing electricity is now down to 10 to 12 cents per kilowatt-hour. That is still nearly double the goal set by the U.S. Department of Energy to reduce the cost of solar power to six cents per kilowatt-hour by 2020. The national average of photovoltaic (PV) solar panel production cost for electricity is not quite at that level now, according to this article. But PV proponents say the cost curve is still descending, putting the 6 cents target within reach and that there is little room for cost reduction with the molten salt solar concentration facility.
Not Just the 1%: The Upper Middle Class Is Larger and Richer Than Ever (The Wall Street Journal) Using Census Bureau data available through 2014, he defines the upper middle class as any household earning $100,000 to $350,000 for a family of three: at least double the U.S. median household income and about five times the poverty level. At the same time, they are quite distinct from the richest households. Instead of inheritors of dynastic wealth or the chief executives of large companies, they are likely middle-managers or professionals in business, law or medicine with bachelors and especially advanced degrees. Mr. Rose adjusts these thresholds for inflation back to 1979. Econintersect: This study is factually correct, but what does it prove? We are unaware of anyone who has suggested that upper middle class incomes are hurting. See the next article
U.S. Household Incomes: A 47-Year Perspective (Doug Short, Advisor Perspectives dshort.com) Look at this article and compare to the preceding one. Here incomes have been divided into quintiles. The upper middle income group in the preceding article contains the bottom approximately 2/3 of the top 5%, all of the top quintile except the top 1.8% of all incomes and about the top 1/5 of the next to top quintile. That is a fortuitous selection which hides the pattern that income growth has systematically increased by larger amounts the higher the income group is in the array of all incomes. See first graph below. It also hides the fact that, while higher incomes (top two quintiles) have remained nearly unchanged in the 21st century, they have declined in real terms for the bottom 60%. See second graph below.
Connecting the Dots: Debt, Savings and the Need for a Fiscal Growth Policy (Private Debt Project) Hat tip to Warren Mosler. Andea Terzi, Franlkin University Switzerland, uses sector balance analysis to show why the European experience following the Great Financial Crisis (GFC) has been so much worse than the U.S. Reducing government deficits unduly when the private sector balance is weak explains the depression in Europe while the U.S. experienced a "Great Recession" and has recovered. See more on European sector analysis by Dirk Ehnts: Eurozone Sectoral Balances.
'Outrageous' and 'a liar' - Germany and France lead criticism of Boris Johnson (The Guardian) Europe has reacted furiously to Boris Johnson's appointment as the UK's foreign secretary, with the French and German foreign ministers respectively calling him "a liar with his back to the wall" and someone whose behaviour has been "outrageous". Senior European politicians made little effort on Thursday to hide their disgust at Johnson, whom they blame for Britain's vote to leave the EU. Their anger is fuelled by the widespread perception that he cynically lied to the British public about Brexit and dodged responsibility in the immediate aftermath.
Truck 'terrorist' kills 80 in attack on Nice Bastille Day crowd (Reuters) A "terrorist" gunman killed at least 80 people and wounded scores when he drove a heavy truck at high speed into a crowd that had watched Bastille Day fireworks in the French Riviera city of Nice late on Thursday, officials said. Interior Minister Bernard Cazeneuve said 80 people died and 18 were in a critical condition. Many more were also wounded in the attack along the famed seafront Promenade des Anglais as the fireworks ended just after 10:30 p.m. (2030 GMT). The driver also opened fire before police shot him dead.
Kerry meets with Putin about cooperating against Islamic State in Syria (Reuters) U.S. Secretary of State John Kerry met with Russian President Vladimir Putin about boosting military and intelligence cooperation against Islamic State and al Qaeda in Syria and told him that without "concrete, near-term steps," diplomatic efforts to end the war could not go on indefinitely. Kerry met Putin for three hours at the Kremlin and their talks lasted until 1 a.m. local time on Friday. The State Department said Kerry expressed concern about repeated violations of a cessation of hostilities by the Moscow-backed Syrian government. On Thursday, The Washington Post published a leaked document it said Kerry would put forward in Moscow calling for intelligence sharing to identify leadership targets, training camps, supply lines and headquarters of the Nusra Front, al Qaeda's affiliate in Syria. It said the two also discussed the need to need to increase pressure on groups like Islamic State and the Nusra Front, al Qaeda's affiliate in Syria.
Massive Stimulus Keeps China GDP Steady in Second Quarter (The Wall Street Journal) Chinese growth held steady at 6.7% in the second quarter, as the record stimulus that poured into the economy in the first quarter lent at least temporary stability to a slumping economy. The growth report came in above forecasts after prior data hadshowed weaker manufacturing, exports and private investment. Friday's data were likely to ease pressure on Beijing to roll out more immediate stimulus measures, which have proven increasingly ineffective in reversing downward momentum. A poll of 16 economists by The Wall Street Journal had predicted 6.6% growth in China's gross domestic product for the quarter. Econintersect: Xi Jinping's government has a high motivation to maintain growth in China near current levels for the next five quarters as the every-five-year reshuffling of party leadership occurs late next year. If the economy were to significantly weaken between now and then, Xi's supporters could be moved to lower positions weakening his hand for the second five years of his term at the top.
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