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.
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Articles about events, conflicts and disease around the world
Barclays: There's a New Oil Glut in Town (Bloomberg) As crude oil continues to rip higher—it's currently in the midst of its best three-day performance since January 2009—analysts at Barclays highlight one reason why this rally could prove to be short-lived. Resilience in U.S. shale production and supply increases from members of OPEC have left global oil markets in a prolonged state of surplus. Barclay's says the "new glut" is simply building on the base established by the "old glut".
World to Fed: We're prepared for U.S. rate hike, so don't delay (Reuters) Central bankers from around the world are telling their American counterparts that they are ready for a U.S. interest rate hike and would prefer that the Federal Reserve make the move without further ado. In private and in public at last week's global central banking conference in Jackson Hole, the message from visiting policymakers was that the Fed has telegraphed an initial monetary tightening and, following a year-long rise in the dollar, financial markets globally are as ready as they can be.
Obama to rename tallest U.S. peak in historic Alaska visit (CNN) The official name of Mt. McKinley will be changed to the aboriginal name Denali by executive order this week. The national park in which that peak is contained already has that name, which means "the great one" in the native Athabascan language. The State of Alaska has had a request for the name change since 1975. The name Denali for the mountain is widely used in Alaska and among the global outdoors community. The name change is not popular in Ohio since President McKinley was from that state. Econintersect: There are other "anglo" names for high mountains in the U.S. for which the Native American name has not been widely proposed to be used on official documents. For example, Mt. Marcy, the highest peak in the Adirondacks, rising within 30 feet of a mile above Lake Champlain, is sometimes called "Tahawus" ("cloud splitter" in the local aboriginal language). But there is no evidence that the word was actually used as the name for the mountain before the arrival of Europeans. The Native American name for Mt. Washington in New Hampshire, the highest mountain in the northeastern U.S. is Agiocochook, roughly translated as "Home of the Great Spirit" or "Mother Goddess of the Storm" in the native Abenaki language. Other peaks have Indian names no longer remembered, such as Mt. Mitchell, North Carolina, the highest U.S. peak east of the Mississippi River. The spectacula Mt Katahdin in Maine still has its aboriginal name, meaning "the greatest mountain" in the Penobscot Indian language.
Palmyra's Temple of Bel 'still standing' (BBC News) Palmyra's ancient Temple of Bel is still standing despite an attempt by Islamic State (IS) militants to blow it up, Syria's antiquities chief has said. Maamoun Abdulkarim confirmed there was a large explosion within its perimeter but said the basic structure of the 2,000-year-old site was intact. But the extent of the damage is unclear with witnesses unable to get close to the temple. Initial reports said the site had been partially destroyed,supported by satellite images shown on GEI.
Ukraine guardsman killed in nationalist protest outside parliament (Reuters) The difficulty that President Petro Poroshenko faces in trying to follow through on the peace agreement reached in February for eastern Ukraine was emphasized today. A Ukrainian national guardsman was killed and nearly 90 others wounded by grenades hurled from a crowd of nationalist protesters on Monday as thenational guard was guarding parliament where lawmakers backed giving more autonomy to rebel-held areas.
Japan eyes defense budget hike to fortify island chain facing China (Reuters) Japan's Ministry of Defense is seeking a fourth straight annual military budget hike to help fortify the country's far-flung island chain in the East China Sea, close to ocean territory claimed by Beijing. Japan's military budget ($42 billion) is much smaller thanh China's ($138 billion).
Shanghai Stock Exchange (Website) The Shanhai Composite rallied frokm morning lows to close down 0.81% for the day Monday 31 August.
Blast reported at chemical plant in northern China (Reuters) More questions about hazardous materials safety are likely in China after an explosion shook a chemical plant on 01 September shortly after midnight in the eastern Chinese province of Shandong There were no immediate reports of casualties in a country on edge after blasts killed more than 145 people last month.
China is Rebalancing (Walter Kurtz, The Daily Slot) What is going on in China? Exactly what China has sais it wanted to go on. The economy continues to rebalance away from manufacturing, investment and exports and toward increased consumption, as exemplified by growth of the service sector.
Other Economics and Business Items of Note and Miscellanea
Why You Shouldn’t Trust Most Financial Research (Michael Edesess and Kwok L. Tsui, Advisor Perspectives) Michael Edesess has contributed to GEI. This is a wonkish article but very important. The essential factor discussed is that much financial "research" that is presented to the public is the result of cherry picking. This is not the sort of cherry picking that involves selecting only certain portions of a data set that "work" and throwing the rest away. The situation here uses all the data but then selects one or a few manipulations of the data that give the desired result. An example given in this article concerns the correlation of industrial production (IP) with stock market returns. An investment bank researcher once found that IP lagged in time by 17 months was correlated with market-beating investment returns. But undeclared in the presentation was that lagging by any other time factor did not beat the market. These total results (lagging by 1, 2, 3, ... 16, 18, 19, .... months not beating the market) make it highly likely that the 17-month lag result was a random happening. Econintersect: To test the significance the correlation should be tested over multiple time periods. This is what is commonly called "out-of-sample" testing and is a critical first step to evaluate any proposed market-beating "formula". In addition, if a parameter like IP does correlate to stock returns with some particular lag, it is likely only to be a generally significant finding if the lag (17 months in the case of the example) is surrounded by other lags which are positively correlated but to a lesser degree than the "peak". In other words, 17 months is more likely to be meaningful if lags of 13 months are also positively correlated, with correlation increasing for 14 months and again for 15 and 16 months. After the high correlation for 17 months, the correlations should systematically fall for 19 months, then 20 months, etc. There is no likely explaination other than random "luck" if 17 months stands alone. But even if the extended examinations are successful one must still apply the caveat: Past results are no guarantee of future performance.
Toshiba Probing 10 New Accounting Issues Including at U.S. Unit (Bloomberg) Fiscal 2014 earnings release for Toshiba, originally due in May, have been delayed again to 07 September. Accounting irregularities, which have already produced $1.2 billion in writedowns, continue to be a problem. Executives have resigned over the summer and President Masashi Muromachi, who took charge following a July third-party report on accounting practices at the company, said he may quit if the new deadline was missed.
3 Stocks Near Their 52-Week Lows Worth Buying (Investopedia) Econintersect: We consider two of the stocks as speculations and only one a possible investment candidate. Coca Cola (NYSE:KO) has a 3.2% dividend and a 7% projected growth rate.
Jim Cramer Points to 23 Quality Stocks Down 30% or More That Could Be Good Buys (TheStreet) As a result of last week's market volatility, 11 stocks plummeted more 50%; 24 more than 40%, 23 more than 30%, 78 more than 20% and 104 more than 10%, Cramer counts in a RealMoney post on Monday. Listed in this article are 23 of the 58 down 30% or more that Cramer thinks are the best of that group. Before you get too excited, realize that TheStreet has only 4 of these currently rated "Buy". "Hold" (10) and "Sell" (9) complete the list. Not surprisingly the Energy sector has the most stocks on the list (7), followed by Technology and IT (6), Financial and Industrials (3 each), Consumer Retail (2) and Gold Mining and Telecom (1 each).
Traveling Backward in Time Is Kind of Hard (Scientific American) The longest travelling astronaut, Cosmonaut Sergei K. Krikalev who spent 803 days orbiting the earth at 17,000 mph. According to Einstein's General Theory of Relativity time slows as velocity increases. So Krikalev experience 1/48 second less time in those 803 days that did the planet earth and everything thereon. So all that he sees today is 1/48 second in the future according to his "clock". So we have already demonstrated travel forward in time. But going backward is "a different wormhole".
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