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What We Read Today 15 August 2015

Econintersect: Every day our editors collect the most interesting things they find from around the internet and present a summary "reading list" which will include very brief summaries (and sometimes longer ones) of why each item has gotten our attention. Suggestions from readers for "reading list" items are gratefully reviewed, although sometimes space limits the number included.

This feature is published every day late afternoon New York time. For early morning review of headlines see "The Early Bird" published every day in the early am at GEI News (membership not required for access to "The Early Bird".).


Every day most of this column ("What We Read Today") is available only to GEI members.

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Articles about events, conflicts and disease around the world


  • Volcano alerts issued in Ecuador, Japan (CNN)  Cotopaxi, a volcano not far from the Ecuadorean capital of Quito, spewed ash several times Saturday, sending large gray puffs 3 miles into the sky.  A yellow alert has been issued, but there is no impending probability of a major eruption.  Cotopaxi is 5,911 meters (19,388 feet) in elevation and last erupted in 1940, according to the Smithsonian Institution Global Volcanism Program. In the last major eruption in 1877, muddy debris traveled more than 100 kilometers (62 miles).

    In Japan, the Sakurajima volcano showed increased activity Saturday.  Japan's meteorological agency warned residents on the country's southwestern island of Kyushu to get ready to evacuate. It issued a level 4 emergency warning, which urges residents to prepare to evacuate. Level 5 is the highest.


  • Why American Teens Aren't Working Summer Jobs Anymore (Bloomberg)  At 41.3%, the July labor force participation rate of teens was the lowest for the month in the post-World War II period.  The data shows that summer jobs for teens have been declining for the last 50 years, about 40% today of what they were in 1966.  Several possible reasons are discussed but the most likely causes are (1) more teens are working yearround; (2) immigrants are taking more low-paying jobs formerly fill be teens; and (3) seniors are working more in lower skill jobs for supplimental income.  
  • America, Race and the Economics of the Precipice (Counterpunch)  The basic message of this article is that policies and activities do not to overtly favor or disfavor certain groups to be racist in effect.  


  • With euro boosting exports, German economy expands by 0.4 percent in Q2 (Fox Business)  Official figures show that Germany's economy, Europe's biggest, expanded by 0.4% in the second quarter of the year from the previous three-month period (1.6% annualized rate), boosted by increased exports resulting from the depreciation of the euro. The figures released Friday show growth in Europe's biggest economy picked up slightly from the 0.3% growth rate recorded in the first quarter.



  • Death toll from Tianjin explosions climbs to over 100 (CNN)  In additon to at least 105 deaths the injured total now exceeds 700.  The toll has been lower than it might have been because nearby residential buildings were new and not yet fully occupied.  The series of videos here is quite comprehensive.


  • Taiwan's 2015 economic growth forecast revised downwards to 1.56% (Focus Taiwan)  The Directorate General of Budget, Accounting and Statistics (DGBAS) revised downward Friday Taiwan's 2015 economic growth forecast from its late May projection of 3.28% to 1.56%. The considerable downward adjustment can partially be attributed to the low GDP growth in the second quarter at 0.64%, far below the previously projected 3.05%.


  • Child obesity in Mexico (Al Jazeera)  The latest U.S. export is its supersized diet, sent to the children of Mexico.  Mexico now has one of the highest obesity rates in the world. Diabetes, for which obesity is a contributing factor, is now the No. 1 cause of death in the country.  And the problem is worse with the country's youth portending an even more problematic future if habits are not changed. 

S&P 500 Snapshot: Up for the Day and Week (Doug Short, Advisor Perspectives  Doug Short is a regualr contributor to GEI.  The chart below shows the S&P 500 "adventure for the week.  Also in this post is a graph that shows the 13 market declines of 5% or more since the beginning of 2009 (11 in the last 72 months).  Corrections have occurred approximately twice a year.  Declines of more than 10% have occurred twice and there have been none over 20% (-19.4% in mid-2011 came close).


Implicit Climate Subsidy Exceeds Profits at 20 Top Fossil Fuel Companies (The Energy Collective)  The proposition is that the failure to assess fossil fuel energy producers for the cost of future damage from burning these fuels amounts to an implicit subsidy for these companies.  The article admits that there is large uncertainty regarding the future costs so the graph below must be considered problematic.  For more details see Quantifying the Implicit Climate Subsidy Received by Leading Fossil Fuel Companies (Chris Hope, Paul Gilding and Jimena Alvarez, University of Cambridge).

Click for large image with complete axis labels at The Energy Collective.

What Happens Next? (Zero Hedge)  The last three times Asian currencies collapsed against the US Dollar at this rate, the global financial system was shaken to the core. With China piling on this time, ZH wonders - what happens next?  The author sees

"a tsunami of deflation is exported towards the shores of the "we'll hike no matter what" Fed's American shores."


Other Economics and Business Items of Note and Miscellanea

  • 'Crank Economics, Crank Science, Crank Foreign Policy' (The Huffington Post)  This article bemoans the emphasis on snesationalism and "irrationality" in American politics.  The article focuses on the Republican party but does it also apply to Democrats?  From the article:  A "rational player" in this context could be defined as someone capable of changing an opinion when it is contradicted by new facts.  With that context Econintersect observes that it is often political suicide for a national political figure to admit that they have changed their mind.  The American public seems to prefer a steadfast leader to one who accommodates changes in thinking. But, beyond that, there actually are scientifically observable biological differences between people with opposing political thinking.  See next article.
  • Differences in Conservative and Liberal Brains (  Presented here are 16 academic studies comparing the physiological and brain responses of liberals and conservatives.  Because some readers may want a gotcha to quote for attacking those who think differently, we suggest #2 for liberals who want to assert that conservatives are shallow or lazy thinkers and #16 for conservatives who want to claim that liberals are mentally disturbed and unstable.  Research has shown that brain structures and and brain activity patterns are different for conservatives and liberals.  It has not been suggested by any research we have seen whether brain patterns predetermine political choices (the DNA hypothesis) or political thinking influences brain patterns (the environmental hypotheisis).  Econintersect:  Since there are cases of people who at some time in their life change from liberals to conservatives and vice versa, there is an existence proposition to support the environmental hypothesis. See Wikipedia
  • ANALYSIS-Solar is having a great year, except on Wall Street (Reuters)  Installations of solar panels are expected to soar by a third this year, the price of solar power is now cheap enough to compete neck and neck with gas and coal-fired power in places like California, and the fledgling industry received a vote of confidence last week when U.S. President Barack Obama announced a groundbreaking plan to curb power plant emissions. Even China's currency devaluation could cut panel costs for U.S. solar installers.  Wall Street, however, has been dumping solar shares this year, largely on concern, which investors say is misplaced, that tumbling oil prices will sap demand for alternative energy, even though oil isn't used to generate power.  The carnage has intensified in the last two weeks. The MAC Global Solar Energy index has dropped 36 percent since its 2015 high in April, with industry bellwether SunEdison Inc having lost 55 percent of its value since July 20. SunRun Inc, one of the top residential solar installers, went public last week at $14 a share and closed Thursday at $10.12.  Econintersect:  Which is a better bottom fishing candidate:  Oils stocks or solar stocks?

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