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What We Read Today 07 August 2016

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".).

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Topics Today Include:

  • What Policy Beats Universal Pre-K?

  • Foreign-born Workers Dominate Jobs Growth

  • Needs of Finance are Driving Lower Bond Yields

  • Global Stocks Rally Moderates Further

  • State of the World's Forests

  • Rubio:  No Abortions for Zika Pregnancies

  • Mutant Zika-killing Mosquitoes

  • Why the Public Hates Congress:  Latest Example

  • Political Infighting Stops Zika Legislation - Congress Takes 7-week Vacation

  • Kasich Says He Was Offered "Super-VP" Role

  • Dramatic Proof that EZ Crisis Was a Public Debt Problem, Just Not in the Way You May Think

  • Norway Keeps Producing Oil (and Increasing Natural Gas Output)

  • Iran Nuclear Scientist Hanged, Charged with Spying for U.S.

  • Why Putin Hates Clinton

  • What Countries are Most Dependent on China?

  • And More

Articles about events, conflicts and disease around the world

Global

  • The State of the World’s Forests 2016 (United Nations)  This infographic illustrates key facts from the 2016 edition of the biannual FAO State of the World’s Forests report. The State of the World’s Forests (SOFO) 2016 shows that it is possible to increase agricultural productivity and food security while halting or even reversing deforestation, highlighting the successful efforts of Costa Rica, Chile, the Gambia, Georgia, Ghana, Tunisia and Viet Nam.

Click for larger image at UN website.

U.S.

  • Marco Rubio: women with Zika should not be allowed abortions (The Guardian)  Florida senator Marco Rubio has said women infected with the Zika virus should not be allowed to have abortions, even if their babies have microcephaly, thesevere developmental disorder than can result from infection with the disease.  “If I’m going to err, I’m going to err on the side of life,” the Republican told Politico. Rubio, who has championed Zika funding bills in the Senate, also blamed Democrats for the failure to pass such federal aid.  See also next two articles.

  • The FDA just greenlit releasing mutant Zika-killing mosquitoes in Florida (Fusion)  Our sci-fi future just got a whole lot closer to becoming a reality, after the Food and Drug Administration gave the okay to a field trial that would release genetically modified Zika-killing mosquitoes in the Florida Keys.  On Friday, the FDA released a final environmental assessment of the trial, finding that it “will not have significant impacts on the environment”. The project, led by Oxitec, a biotech company that focuses on insect control, calls for the release of thousands of genetically engineered male Aedes aegypti mosquitoes. The lab insects are bred so that over time they could kill off much of the local mosquito population by passing on a gene fatal to any offspring they have with wild females.  Econintersect:  Sounds like the FDA does not know what it is they do not know.  The statement about "no significant impacts on the environemnt" is totally irresponsible.  They may have a basis to say "we have not discovered any adverse impacts" but we don't even know that until researchers have examined in detail what the FDA has actually done.

  • 'This is why people hate Congress': politics stymies fight against Zika virus (The Guardian)  Infighting for political advantage has stalled attempts to get a bill pass to fund Zika virus research and treatment.  After some leaders in both parties made strong statements supporting the need for action, Congress adjourned for a seven week recess with members of each party blaming the other side for lack of progress.

  • Kasich: Trump Jr. called aide to float VP offer (CNN)  Ohio Gov. John Kasich still isn't ready to support Donald Trump for president -- but he confirmed that one of his aides was contacted about possibly joining the real estate mogul's ticket as his vice president.  Kasich told CNN's Jake Tapper that he didn't receive a call himself. But he said one of his aides confirmed to him a New York Times report last month saying Donald Trump Jr. tried to entice Kasich with a position as the most powerful vice president in history -- putting him in charge of all domestic and foreign policy -- was accurate.

EU

  • We NOW know that EZ crisis was NOT a public debt crisis. (Twitter)  Econintersect:  The fatal turn late 2009 - public debt growth and private debt growth both headed down just as private debt growth goes negative.  Reminds us of U.S. Treasury Secretary Andrew Mellon (1921-1933) who said when faced with the collapse into The Great Depression  supposedly said (according to Herbert Hoover's memoirs):

"liquidate labor, liquidate stocks, liquidate farmers, liquidate real estate... it will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up from less competent people." 

ez.crisis.public.private.debt

Norway

  • Western Europe’s Biggest Oil Producer Has a Surprise for Markets (Bloomberg)  Norway is helping keep downward pressure on oil prices.  For Norway, the collapse in crude prices has a silver lining: output has exceeded expectations every month for the past two years.  That’s likely to continue as oil companies boost efficiency and pump at full pace as revenue dwindles, according to the head of Petoro AS, the state-owned oil company that owns more than a quarter of the petroleum output in Western Europe’s biggest producer.  And an even bigger impact on energy has been a massive surge in natural gas production over the past 12 months.

Iran

  • Iran: Nuclear scientist executed for spying for 'Great Satan' U.S. (CNN)  An Iranian nuclear scientist who once claimed he was kidnapped by the CIA has been executed after being accused of spying for the United States. Shahram Amiri had been in custody in Iran since 2010.  According to state news agency IRNA, Iranian judicial spokesman Hojjat al-Eslam Mehdi Mohseni-Ejehei told reporters Sunday: 

"Shahram Amiri had access to the system's top secrets and had gotten connected with our number one enemy the Great Satan."

Russia

As secretary of state, Hillary Clinton basked in a diplomatic "Moscow Spring," seizing on Vladimir Putin's break from the presidency to help seal a nuclear arms-control treaty and secure Russia's acquiescence to a NATO-led military intervention in Libya. But when Putin returned to the top job, things changed.

Clinton, the Democratic presidential nominee, has vowed to stand up to Putin if elected, drawing on her four years of ups and downs as the public face of President Barack Obama's first-term "reset" with Russia. By comparison, her Republican opponent, Donald Trump, has rung alarm bells in Washington and Europe with his overtures to the authoritarian Russian leader.

But Clinton's wrangles with Russia led to mixed results. Her fortunes dipped dramatically after Putin replaced Dmitry Medvedev as president in May 2012.

Just weeks later, Russia outmaneuvered her in negotiations over a complicated Syria peace plan, dealing her what was arguably her worst diplomatic defeat. While Clinton hailed it as a triumph, the war only escalated. And while her aides still insist she came out on top, the blueprint effectively gave Syria's Moscow-backed president, Bashar Assad, a veto over any transition government, hampering all mediation efforts still.

China

  • Who is Most Dependent on China? (Bloomberg)  If (or when) China sneezes -- ranging from a sharp devaluation of its currency or protectionist measures to defend local industries -- Singapore, Taiwan, Vietnam, South Korea and Malaysia would be first to feel the chill, according to analysis from Natixis SA.  By contrast, Indonesia, India and the Philippines are rather more immune, based on trade, tourism and investment links that were collated by the French Bank's Hong Kong-based economists Alicia Garcia Herrero and Trinh Nguyen.

Other Scientific, Health, Political, Economics and Business Items of Note - plus Miscellanea

  • This policy would help poor kids more than universal pre-K does (Brookings Institution)  Unfortunately, children who attend Head Start do no better in school than equivalent children who do not. Even the best pre-K programs’ positive impacts fade away in a couple of years, and some early-childhood programs actually leave children worse off than if they hadn’t participated at all.  On the other hand, comparison of the effects of direct income transfers to low-income families (such as the earned-income tax credit, or EITC) with programs designed to increase school readiness (universal preschool and Head Start). It turns out that putting money directly into the pockets of low-income parents, as many other countries do, produces substantially larger gains in children’s school achievement per dollar of expenditure than does a year of preschool or participation in Head Start. The results throw water on the conventional wisdom.  The author recalls an old story:

Former senator Daniel Patrick Moynihan likened government bureaucracies dispensing social services to the poor as “feeding the sparrows by feeding the horses.” The school readiness option feeds the horses. Perhaps it is time to rethink our paradigm for supporting poor families. Let’s give them what they desperately need — more money — and let them decide how to spend it on the early care and education of their children.

  • What you haven’t been told about the July jobs report (Fabius Maximus)  FM has contributed to GEI.  Employment of foreign-born workers grows faster than natives.  Of the 2,715 new jobs created in the past year, 47% went to foreign-born workers.  Fort complete employment analysis see July 2016 BLS Jobs Growth Was Good For The Second Consecutive Month.

    Growth in workers by place of birth (NSA): index with June 2009 = 100.  

  • Economists Reveal Massive Market Forces In Bonds Before And After QE (Talk Markets)  The author asserts that interest rates are low, with bond coupons near at and below zero for sovereign debt, because these notes and bonds are the equivalent of money and in great demand to satisfy reserve and capital requirements for banks.  He sees an unrelenting force majeure driving soverign debt yields ever lower for years to come.  Econintersect:  Doesn't this suggest that some other form of money is needed to put the system back in balance?

  • World Markets Weekend Update: The Global Rally Moderates Further (Advisor Perspectives dshort.com)  The performance of the equity indexes on our global watch list was a mixed bag last week. Five of the eight posted gains, up from only three the previous week. But the average gain of the aggregate was only 0.04%, down from 0.27% the previous week. Hong Kong's Hang Seng was the top performer with its 1.16% advance. Japan's Nikkei was the biggest loser, down 1.90%. The UK's FTSE had the second best week with its 1.03% gain. The FTSE is up 7.18% since the Brexit vote on June 23rd. The S&P 500 had the third best week, but its modest 0.43% gain was enough for a new record close on Friday.


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