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What We Read Today 08 October 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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Today's post is abbreviated due to intermittent power problems related to Hurricane Matthew.

Topics today include:

  • Matthew Makes Landfall in South Carolina

  • Capitalism Creates Pointless Jobs

  • The Latest on Health Care Policy from the American Medical Association

  • Understanding Secular Stockmarket Cycles

  • We are in the 17th Year of a Secular Bear Market

  • Wikileaks Exposes Parts of Clinton's Wall Street Speeches

  • GOP in Chaos, Trump Endorsements Withdrawn

  • Republicans Call on Trump to Leave Race

  • Hungary's Largest Newspaper Closes, Government Pressure Alleged

  • Yemen Funeral Bombed Killing at Least 82

  • And More

Articles about events, conflicts and disease around the world

U.S.

  • Hurricane Matthew moves into South Carolina; serious flooding threatened (CNN)  Category 1 Hurricane Matthew made landfall late Saturday morning over South Carolina's central coast, and the storm's sea surges and rainfall appeared poised to threaten life-threatening inland flooding for that state and North Carolina as the storm crawled to the northeast.  Matthew's center crossed near McClellanville, South Carolina, between Charleston and Myrtle Beach before 11 a.m. ET. Three hours later, the center was over Myrtle Beach, with maximum winds just above hurricane threshold at 75 mph, the National Hurricane Center said.  The storm has killed hundreds in the Caribbean and at least four people in Florida, and left swaths of damage and hundreds of thousands of power outages along parts of the US southeast from Florida to the Carolinas.  Sig Silber is providing continuously updated storm reports at GEI.

matthew.2016.oct.08.4pm

  • WikiLeaks posts apparent excerpts of Clinton Wall Street speeches (CNN)  Thousands of hacked emails from Hillary Clinton's campaign chairman, John Podesta, were posted online Friday evening, including what appears to be excerpts from transcripts of closed-door speeches Clinton gave to Wall Street companies after leaving the State Department.  WikiLeaks, which has been alleged to work with Russia, posted more than 2,000 emails from Podesta and promises to post more from a trove of more than 50,000 the group said it has access to.  The Clinton campaign would not confirm the authenticity of any of the documents but has not disputed the contents.  Clinton's comments to financial firms, if legitimate, would validate what supporters of Bernie Sanders long said about her: Clinton is a fake populist who is really out of touch with the middle class. But the timing of the leaks, well after the Democratic primary and the same night video emerged of Donald Trump bragging about being able to grope women, could blunt any political impact.

  • Chaos in GOP: Calls grow for Trump to drop out of race (The Hill)  Donald Trump's  presidential campaign is teetering on the edge of implosion over the obscene sexual comments he made about women, with the nominee facing unprecedented calls from Republicans to drop out of the race.  Trump’s late-night apology for the remarks failed to quell the storm over his comments, which were caught on video in 2005 and include a graphic line about grabbing women “by the p---y.”  See also Donald Trump to Howard Stern: It's okay to call my daughter a 'piece of ass' (CNN).

  • Melania Trump asks forgiveness for husband's 'offensive' comments (The Hill)  Melania Trump says she was offended by her husband Donald Trump's "unacceptable" sexual remarks about women, but is asking the nation to accept his apology.  Melania Trump said in a Saturday statement that the

“... words my husband used are unacceptable and offensive to me  This does not represent the man that I know. He has the heart and mind of a leader.”

  • The Latest: Ryan greeted with some boos from Trump backers  (Associated Press)  House Speaker Paul Ryan was greeted with a mixture of boos and cheers at a Republican rally in his Wisconsin congressional district.  Ryan began his comments Saturday by saying "there is a bit of an elephant in the room," referring to the profane comments made by GOP nominee Donald Trump that came to light Friday.

Hungary

  • Hungary's largest paper Nepszabadsag shuts, alleging pressure (BBC News)  Hungary's largest broadsheet newspaper Nepszabadsag has stopped publication, with journalists and the opposition alleging government pressure.  Journalists said it was a "coup" - they were given notice after being stopped from entering the building on Saturday.  The owners said it was a business decision following declining sales. There is no government comment.  Nepszabadsag has often criticized Prime Minister Viktor Orban. It opposed last weekend's referendum on refugees.  Mr. Orban's government has often been accused of using public media as a government mouthpiece.  A number of private media outlets have also been bought by his allies, critics say.

Yemen

  • Yemen funeral hall attack 'kills 82' (BBC News)  At least 82 people have been killed and more than 500 injured in a strike on a funeral gathering in the Yemeni capital, Sanaa, rebel officials say.  The Houthi-run government said the hall had been hit by an air strike carried out by the Saudi-led coalition backing the internationally-recognised government of Yemen.  The coalition has denied carrying out a strike, suggesting "other causes".  Thousands of civilians have been killed since the war began in 2014.

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

  • Why Capitalism Creates Pointless Jobs (David Graeber, Evonomics)  Anthropologist David Graeber discusses why increasing replacement of productive jobs by technological advancement has coincided with an increase in superfluous jobs that provide little for society.  He ascribes one aspect of this to an increase in the financial economy which has the objective of increasing financial "wealth" for a few compared to the real economy which produces goods and services for the masses. Here is his introduction:

In the year 1930, John Maynard Keynes predicted that technology would have advanced sufficiently by century’s end that countries like Great Britain or the United States would achieve a 15-hour work week. There’s every reason to believe he was right. In technological terms, we are quite capable of this. And yet it didn’t happen. Instead, technology has been marshaled, if anything, to figure out ways to make us all work more. In order to achieve this, jobs have had to be created that are, effectively, pointless. Huge swathes of people, in Europe and North America in particular, spend their entire working lives performing tasks they secretly believe do not really need to be performed. The moral and spiritual damage that comes from this situation is profound. It is a scar across our collective soul. Yet virtually no one talks about it.

  • Health Care Policy (Journal of the American Medical Association)  Explore the latest in health care policy from The JAMA Network, including research and opinion about health care politics, economics, and law.

  • Understanding Secular Stock Market Cycles (Ed Easterling, Crestmont Research)  EE has contributed to GEI.  Ed argues that stock market valuations are determined by P/E (price/earnings) ratios and inflation.  Stocks may not be overvalued at P/E = 25 if inflation is very low and stable.  However, they may be overvalued at P/E < 15 if inflation is very high.  He has defined secular bull and bear markets (see graphic below) using the principles he proposes (called Crestmont's Axioms):

  1. There are only three components of general stock market returns: earnings growth, dividend yield, and the change in P/E over the investment period.

  2. Earnings growth is closely correlated with and caused by economic growth.

  3. Dividend yield is significantly driven by the level of valuation (i.e., P/E) at the time of investment.

  4. The level and trend of P/E is driven by the inflation rate: low, table inflation drives P/E higher; high inflation or deflation drives P/E lower.

Click for larger image.
secular.stock.markets.crestmont.1900.2016.oct.600x450


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