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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Topics today include:
New Lows for Ag Commodities
Low Cost Hydrogen
Saudi Arabia, Iran and Lower Oil Prices
Obama’s Gun Control
GOP Governors Flip on Medicaid
Big Medicare Changes
Sanders’ Plan to Break Up the Banks
More Migrant Drownings
U.S. Casualties in Afghanistan
Good Health for Costa Rica’s Poor
Articles about events, conflicts and disease around the world
How the Saudi-Iran Crisis Could Drive Oil Prices Lower (The Fiscal Times) Oil prices jumped on the first trading day of 2016 as Middle East tension outweighed a selloff in financial markets around the world. Oil markets remain oversupplied and depressed, but geopolitical flashpoints have a historical tendency to disrupt market trends - and Saudi Arabia and Iran have a long simmering rivalry now boiling over. But the effect of the crisis may be just the opposite of the initial reaction. OPEC was already unlikely to agree to a common strategy that would see production cuts, but now everyone can essentially rule out any cooperation between Saudi Arabia and Iran. Both countries may try to ramp up production (Iran plans on doing that anyway when sanctions are lifted) and discount their oil in an effort to claw away market share from each other.
More market trouble is just around the corner (CNBC) Corporate profits are in for another brutal quarter, and it's not just the usual suspects dragging down everyone else. It's not just energy any more. More than half (6 out of 10) sectors are expected to show earnings declines. S&P 500 earnings are expected to decline about 5%, depending on whose estimates you use, marking the third consecutive quarterly decline in what clearly has become a profits recession. If the trend holds up, it would be the longest stretch of earnings declines since the Great Recession was churning to an end in 2009, according to FactSet.
Some GOP Governors Flip for Medicaid Funds -- on Their Terms (TheFiscal Times) Newly ensconced Kentucky Gov. Matt Bevin (R) last week backed away from his campaign pledge to repeal expanded Medicaid coverage for 400,000 low-income people in the face of the widespread popularity of the program. Now the new Republican governor is sounding a different political tune, declaring he will seek a waiver from the federal Centers on Medicare and Medicaid Services to reform the program in a way that better reflects his conservative principles, that toughens standards for qualifying for coverage and that assures the long-term financial sustainability of the Medicaid program. Currently, 20 states have rejected expanded Medicaid coverage, although several are considering changing their decision. A small handful of other Republican governors have changed their positions on terms they demanded through waiver requests like the one Bevin intends to seek.
Sympathy for jailed ranchers, anger at occupiers in Oregon town (Reuters) Residents of the Oregon town thrust into the spotlight after self-styled militiamen took over a U.S. wildlife refuge voiced sympathy for the jailed ranchers whose plight inspired the action and but were critical of the armed protesters. Saturday's takeover of the Malheur National Wildlife Refuge outside the town of Burns, Oregon, marked the latest protest over federal management of public land in the West, long seen by conservatives in the region as an intrusion on individual rights. Ranchers Dwight Hammond Jr. and his son, Steven, who on Monday surrendered to serve longer prison terms for setting fires that spread to federal land, had been regulars at a town diner where residents were sympathetic and said they feared the federal government wanted to seize ranch lands for its own use. Diners voiced skepticism about protest leader Ammon Bundy, the son of a Nevada rancher who along with a large group of armed men successfully stared down federal agents in 2014 when the government attempted to confiscate his livestock because he refused to pay grazing fees.
Medicare is changing: What's new for beneficiaries (Associated Press, MSN News) So far, the 2016 change getting the most attention is that Medicare will pay clinicians to counsel patients about options for care at the end of life. The voluntary counseling would have been authorized earlier by President Barack Obama's health care law but for the outcry fanned by former Republican vice presidential candidate Sarah Palin, who charged it would lead to "death panels". Hastily dropped from the law, the personalized counseling has been rehabilitated through Medicare rules. But there are bigger changes in the area of requiring "coordinated care" between various medical practitioners and facilities.
Sanders to lay out plan to break up big banks in first year (Reuters) Bernie Sanders wants to end TBTF (too big to fail) by making those banks TBTE (too big to exist). He is unveiling his plan to break up big banks today, Tuesday 05 January. He favors reinstitution of the Depression Era Glass-Steagall act which was weakened in the 1980s and 1990s before being repealed completely in 1999.
Migrant crisis: Bodies found on Turkish coast as boats sink (BBC News) At least 34 bodies have been washed up on the Turkish coast in the latest tragedy to hit migrants and refugees trying to cross the sea to Greece. Their boats are thought to have capsized while crossing to the island of Lesbos. The bodies were found on beaches at Ayvalik and Dikili some 30 miles (50km) apart. Several were children. More than one million migrants crossed the Mediterranean in 2015 and the vast majority went from Turkey to Greece. According to the UN, 3,771 people were listed as dead or missing in 2015.
Iran has got away with murder for 30 years: Saudi Foreign Minister (CNBC) The execution of an Islamic cleric by Saudi Arabia has sparked violent protests in Iran and halted diplomatic relations — but the Saudi foreign minister told CNBC on Tuesday that the man in question was "as much a religious scholar as Osama bin Laden." Adel al-Jubeir, the Saudi minister of foreign affairs, added that "Iranians have got away with murder, literally, for more than 30 years," in the exclusive interview
Afghanistan conflict: US casualties on special forces mission (BBC News) One US service member has been killed and two wounded reportedly during a special forces mission in Afghanistan's southern Helmand province. The forces were taking part in a counter-terrorism operation when they came under fire, US officials said. A medical helicopter sent to rescue casualties was forced to land and has yet to be recovered. Some 12,000 international soldiers are still deployed in Afghanistan to help local forces tackle the Taliban.
A Longevity Puzzle: Why Do Poor Costa Ricans Outlive Poor Americans? (Bloomberg) In the U.S. states, income and health go hand-in-hand. That's not the case everywhere. Still, the link between poverty and poor health isn't ironclad. Take Costa Rica, where the poorest 25 percent of people live longer than their counterparts in the U.S., according to an analysis published this week in the Proceedings of the National Academy of Sciences.
Other Economics and Business Items of Note and Miscellanea
IU scientists create 'nano-reactor' for the production of hydrogen biofuel (Indiana University Bloomington) Scientists at Indiana University have created a highly efficient biomaterial that catalyzes the formation of hydrogen -- one half of the "holy grail" of splitting H2O to make hydrogen and oxygen for fueling cheap and efficient cars that run on water. A modified enzyme that gains strength from being protected within the protein shell -- or "capsid" -- of a bacterial virus, this new material is 150 times more efficient than the unaltered form of the enzyme. The enzyme (hydrogenase) is cheap and energy-efficient to produce, coming from a room temperature fermentation process. The production of hydrogen is comparable to the process used in the past which uses electricity and an expensive catalyst (platinum) for the electrolysis of water. A bonus: The virus covered hydrogenase can also be run in reverse by changing conditions, making is a candidate for use in low-cost fuel cells powered by hydrogen. For full details see Self-assembling biomolecular catalysts for hydrogen production (Nature Chemistry).
A Brain-Computer Duel Provides New Insight into Human Freewill (R&D) New research has furthered the knowledge of the strength of human free will, which modifies previous work by American researcher Benjamin Libet who found that actions perceived as freely voluntary are preceded by an electrical charge in the brain called the “readiness potential” (RP) about 550 ms before the act. Writing in the Journal of Consciousness Studiesin 1999, Libet said “Human subjects became aware of intention to act 350-400 ms after RP starts, but 200 ms before the motor act. The volitional process is therefore initiated unconsciously.” However, researchers from the Charité – Universitätsmedizin Berlin—using computer-based brain experiments—have discovered that humans are capable of canceling actions even after the brain has elicited an RP signal. Econintersect: Now there is scientific proof that there is no such thing as an irresistable urge.
14 Wall Street Pros Predict The 2016 Stock Market! (Michael Haltman, LinkedIn) MH contributes frequently to GEI. Fourteen Wall Street gurus interviewed, 14 predictions for an up market in 2016. What could possibly go wrong? Note: One clue about what could go wrong: 10 of the 14 have predictions for the value of the S&P 500 equal to or lower than their predictions one year ago for the value at the end of 2014. Hmm, equal or lower but the market will go up? No, that's not crazy, just not a good track record.
Researchers Sequence Ancient Irish Genome (R&D) Geneticists from Trinity College Dublin and archaeologists from Queen’s Univ. Belfast have sequenced the genomes of four ancient Irish humans, dating as far back as 5,200 years ago, and found evidence that the ancient people had origins in the Middle East (what is now Lebanon, Syria, Turkey, Jordan, and Iraq, among others) and Pontic Steppe (southern Siberia). Econintersect: The current migration from Syria is merely the latest in a long line of migrations.
The World's Top 10 Retailers (WMT, COST) (Investopedia) American and European companies dominate the ranks of the world's largest publicly traded retailers. Most are global companies with vast distribution networks and thousands of retail locations spanning the globe. While many of these companies operate retail websites, Amazon.com stands out as the only fully online retailer to make the list. The companies are ranked according to sales figures reported in financial statements for the most recent fiscal year end.
The ongoing decline in the national vacancy rate finally gained momentum this quarter, falling by 20 basis points to 16.3%. This marks the first time since the market began to recover in early 2011 that the quarterly vacancy rate fell by more than 10 basis points. The vacancy rate has now declined in five of the last six quarters and is at its lowest level since the second quarter of 2009. The quiet acceleration in the office market recovery is now beginning to make more noise. Both net absorption and new construction are increasing, but absorption is beginning to pull ahead of construction by a wider margin. By many measures, including absorption, construction, and vacancy compression, 2015 was the best year in the office market in recent history. The acceleration in improvement will persist in 2016 as the labor market remains near full employment, the economy expands, and office jobs are created.
Faraday Future Unveils Sleek Concept Car at CES 2016 (R&D) Watch out Tesla Motors because Faraday Future—a California-based electric car company—debuted their battery-powered FFZERO1 at the Consumer Electronics Show in Las Vegas on Monday night. The car is a 'beast', powered by a 1,000 horsepower electric motor. See video below. The first production car is scheduled for 2018, to be produced from the company's billion dollar pant under construction in Las Vegas. See CES 2016: Faraday Future shows off its concept car (BBC News).
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