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.
Maybe you were one of those who nodded in agreement with a Wall Street Journal op-ed by Republican economist Michael Boskin, which also is celebrating an eight-year anniversary this week. The headline, which couldn’t have been more off-base, said it all: “Obama’s Radicalism Is Killing the Dow." In the meantime, the S&P 500 increased 232 percent from the time Boskin’s op-ed appeared to the day Obama left office.
This is another cautionary tale of how dangerous it is to confuse your own partisan politics with objective market analysis. Boskin’s contra-indicator warning was almost perfect and just three days later the S&P 500 touched bottom before taking off on one of the longest runs in years.
ACA Repeal-Replace Bill Troubles Organized Medicine (Medscape) Major medical societies such as the American Medical Association (AMA) worry that a House bill to repeal and replace the Affordable Care Act (ACA) will translate into fewer people with health coverage and the care they need. Their objections to the bill, dubbed the American Health Care Act (AHCA), center on two key elements. They say that the bill's new tax credits for buying a private plan are less generous than those under the ACA, particularly for low-income Americans, a claim supported by a recent Kaiser Family Foundation analysis. They also are troubled by major changes to Medicaid - namely, a per-capita cap on the federal contribution to state programs, which could leave them underfunded, and a rollback of expanded eligibility in 31 states and the extra federal dollars that come with it. AMA CEO James Madara, MD, wrote members of Congress yesterday:
"While we agree that there are problems with the ACA that must be addressed, we cannot support the AHCA as drafted because of the expected decline in health insurance coverage and the potential harm it would cause to vulnerable patient populations."
Newly identified fault line in California could unleash monster earthquake (USA Today) Scientists uncovered a newly identified fault line that could unleash a magnitude-7.4 earthquake in the region, which other researchers say is already long overdue for a whopper of a temblor along the infamous San Andreas fault. The concerns are detailed in separate studies that put the quake risks of the USA's most populous state into much sharper focus. The newly identified fault line is capable of a powerful quake that would impact 20 million residents of Los Angeles and San Diego, according to a study published Tuesday. The fault runs underwater from San Diego Bay to Seal Beach in Orange County and on land through the Los Angeles basin, researchers found.
Philip Hammond has delivered his first budget since taking over the role of chancellor of the exchequer after the UK’s Brexit vote put paid to his predecessor, George Osborne. He has unveiled a brighter outlook for economic growth, with an upgraded forecast for growth in 2017 from the Office for Budget Responsibility. He spoke of job creation and wage growth. And, with public finances in better shape than expected, he was also able to report lower borrowing forecasts than in his Autumn Statement.
But recent history shows us why we should not be so confident about all these healthy forecasts. A look at the recent history of economic forecasting makes the upgraded expectations of 2% growth in 2017 questionable. Then there’s the fact that Brexit hasn’t happened yet. With Article 50 soon to be triggered, the uncertainty that harms economies the most will only get worse in the months to come.
Why Is China So … Uncool? (Foreign Policy) There’s been much talk in recent weeks about China’s potential role as world leader, during a time when Trump’s America is erecting walls. China has nearly all the characteristics to lead effectively, with its willingness to engage in global trade and its promises to fight climate change, all backed by its economic and military gravitas. Despite all this, China still isn’t beloved abroad, at least not to the extent that America is. China’s music, movies, and fashions are relatively unpopular. Put another way, China is not seen as cool; its pop culture and pop stars lack global swagger. The question is why, and whether that matters.
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