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.
Asia markets mostly higher; SoftBank jumps 6% (CNBC) Asian shares were higher, with Australia shrugging off weak GDP and Japan's benchmark index up on a Trump announcement that saw SoftBank shares gain smartly. Oil prices slipped on Wednesday during Asian trade for the second day in a row, with the U.S. crude futures down 0.57% at $50.66 a barrel while Brent futures were down 0.41% at $53.70.
Why do some nations hold more gold? (City A.M.) Across the world, and even within Europe, there are different attitudes to holding physical gold. Citizens in China and India - by far the world’s largest markets - and even Germany, hold much more than others. The UK holds hardly any. Why is this? One historical reason to hold physical gold has been a suspicion of fiat currencies, and the government or central bank’s ability to manipulate them. This is probably the primary reason, according to this article.
GOP leaders reveal stopgap spending bill (The Hill) GOP leaders announced a deal Tuesday to keep the government funded for nearly six months, with a slight boost to defense spending and bipartisan health programs. The 70-page stopgap spending bill runs through April 28, allowing the incoming Donald Trump administration to take an active role in negotiations this spring.
EUR/USD (Investing.com) Click on title or chart for latest realtime data.
May doubles-down on Brexit timetable with a challenge to Remainers (City A.M.) Prime Minister Theresa May has moved to see off a potential Commons defeat by accepting a Labour motion requiring the government to set out its Brexit plans to MPs. However, the PM also doubled-down on her Brexit timetable. While the Prime Minister has accepted the Labour motion the government has tabled an amendment which further calls on MPs to support the government's plan to begin proceedings by the end of March 2017. The move comes as the Supreme Court continues to review an earlier High Court judgement that ruled MPs must be consulted before exit proceedings are commenced.
NHS pays £430,000 salaries to stand-in bosses (The Times) Hospitals have been ordered to end “eye-wateringly high" payments to stand-in bosses after a watchdog found that salaries of more than £400,000 ($500,000) have become routine. Some temporary staff could avoid tax on their NHS pay under arrangements described by regulators as deeply unpalatable. Costly employees are not monitored properly and hospitals have little idea whether they are any good, according to NHS Improvement, the financial regulator.
Note this: The cash crunch shock to economy, jobs and key sectors (The Economic Times) Demonetisation torpedoed India’s economy just when it was getting into a cruise mode, fired by good monsoon-led rural demand and Seventh Pay Commission-enabled urban buying. The 8% growth that looked within grasp in FY17 is beyond horizon now. Only about a quarter of currency cancelled is back in circulation, and that too is being stashed away for emergency. Lower denomination notes are not available to facilitate transactions. The fall in demand will further dent already weak investments. The sharpest crash in services PMI since November 2008 in the aftermath of the global financial crisis underscores the risks. Ambit sees growth falling to a low of 3.5% in FY17. Others are not so pessimistic, pencilling in about 7%.
Engineering projects don’t come any bigger than this. If India’s prime minister, Narendra Modi, gets his way, work could soon begin on a project to link large rivers in the Himalayas and Deccan Peninsula via 30 mega-canals and 3000 dams.
When the work is finished the water network will be twice the length of the Nile, the world longest river, and it will be able to divert water from flood-prone areas to those vulnerable to drought.
But geologists and ecologists in India question the science behind the Inter Linking of Rivers (ILR) scheme. If it goes ahead it might lead to ecological disasters and coastal erosion that would threaten livelihoods and endanger wildlife.
And yet New Scientist has learned from the officials close to the project that work on the pilot link is likely to “start any time soon", with final clearance from the ministry of environment and forests expected imminently.
Demonetisation has left us with no cash even for a decent dinner: Russian envoy (The Economic Times) Hat tip to Sanjeev Kulkarni. With so little cash, you can’t even have a decent dinner, forget running regular diplomatic business, the Russian ambassador to India told New Delhi in a strongly worded letter as the country, a major global player and a key defence supplier for India, officially critiqued demonetisation-induced cash shortage for its diplomatic staff. Diplomatic missions of Ukraine, Kazakhstan, Ethiopia and Sudan have also sent protest letters on cash withdrawal restrictions.
Economy shrinks: Wake-up call for Australia (InvestSMART) According to this analysis the negative 0.5% GDP growth in 3Q 2016 will turn out to be just a blip on the radar screen, but a very important blip. Many Australians have become complacent. And that includes businesses and politicians. The only way the economy can grow is by Australians spending, investing and employing. Australians didn’t do this in the September quarter. Still, there was also seasonality involved in the weak result. The Reserve Bank has been intimating for some time, monetary policy is reaching its limits. Infrastructure spending may prove useful in coming quarters in providing fresh momentum to the economy. Econintersect: Australia has not had a recession in more than a quarter of a century. The contraction this quarter is the first in 5 1/2 years.
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