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What We Read Today 16 April 2017

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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Topics today include:

  • The One Secret to a Fulfilling Life

  • Muslims raised $161993 (and counting!) for Missouri’s vandalized Jewish cemetery. 

  • The Reserve Bank must tackle jobs as well as inflation

  • How Doctors Were Duped, Patients got Hooked and Why it’s So Hard to Stop

  • Maritime shipping must come to grips with its CO2 emissions

  • These Top Democrats Could Challenge Trump in 2020

  • Wall Street banker Cohn moving Trump toward moderate policies

  • Finally, some good economic news from the Eurozone – but will it last?

  • Turkey's Erdogan celebrates victory as count points to tight win

  • Trump aide McMaster: Time for tough talks with Russia

  • A $165 Billion Manager Says the Japanese Stock Gloom Is Overdone

  • Kim Jong Un’s Big Nuclear Push Is Closing In on America

  • Trump Ties China Currency Decision to Help With North Korea

  • And More

Articles about events, conflicts and disease around the world


  • Maritime shipping must come to grips with its CO2 emissions (London School of Economics)  Maritime shipping is the transmission belt for the global economy, carrying 90 percent of global trade. It plays a fundamental role in the growth of the world economy. However, it is also a major contributor to global environmental change through a diversity of issues from oil spills, CO2 and other air emissions, to invasive species, disposal of hazardous material and noise. While shipping has held a reputation for being the ‘greenest’ form of transport, this is now under challenge.


  • These Top Democrats Could Challenge Trump in 2020 (NBC News)  President Donald Trump has been in the White House less than 100 days, but frustrated Democrats are already looking ahead to the 2020 elections.  That tantalizing prospect of getting a Democrat back in the White House after four years is expected to attract an unusually sprawling field of candidates that could include everyone from senators and governors to actors and businessmen.  This article suggests the top three contenders could be:

  • Elizabeth Warren

  • Cory Booker

  • Bernie Sanders

  • Wall Street banker Cohn moving Trump toward moderate policies (Reuters)   In a White House marked by infighting, top economic aide Gary Cohn, a Democrat and former Goldman Sachs banker, is muscling aside some of President Donald Trump's hard-right advisers to push more moderate, business-friendly economic policies.  Cohn, 56, did not work on Republican Trump's campaign and only got to know him after the November election, but he has emerged as one of the administration's most powerful players in an ascent that rankles conservatives.  Trump refers to his director of the National Economic Council (NEC), as "one of my geniuses," according to one source close to Cohn.

More than half a dozen sources on Wall Street and in the White House said Cohn has gained the upper hand over Trump's chief strategist, Steve Bannon, the former head of the right-wing website Breitbart News and a champion of protectionist trade opposed by moderate Republicans and many big companies.


  • Finally, some good economic news from the Eurozone – but will it last? (London School of Economics)   Finally, good news from the Eurozone. Unemployment rates fell to 9.5% in February 2017. According to Eurostat, this is the lowest rate since May 2009. The 19 countries that have adopted the common currency are thus returning back to the unemployment level they experienced before the outbreak of the Eurozone crisis. In the last 12 months, the Eurozone recovery has lifted 1.25 million people out of unemployment.  This long-awaited decrease in unemployment is highly welcome; every person back in work is good news, even though it took nine years to recover. Yes, many economists believe that the recovery could have been faster with much less pain if there had been less initial emphasis on austerity and less reluctance “to do what it takes” at the ECB before Mario Draghi made that move in 2012. But that said, the Eurozone must now look forward.

So, is the worst over? Is wealth and prosperity – the ultimate promise of the EU to its citizens – finally coming back to the Eurozone? And is the fragility of the Eurozone that brought the crisis and the dramatic rise in unemployment a thing of the past?

To start with: Yes, the worst is over, but ‘better’ is not yet ‘good’. First, the benchmark should not be 2009, but 2007, the year before the great financial crisis, when the unemployment rate stood at around 7.5%. Second, even this number was back then considered as being much too high, pointing at structural unemployment problems in several countries.

Click for larger image.


  • Turkey's Erdogan celebrates victory as count points to tight win (Reuters)   President Tayyip Erdogan celebrated what he said was a clear result in a referendum on Sunday to grant him sweeping new powers, but opponents said they would challenge the vote count which gave a narrow 51.3% lead to Erdogan's supporters.  Nearly all ballots had been opened for counting, state-run Anadolu news agency said, although a lag between opening and counting them could see the lead tighten even further.  Erdogan called Prime Minister Binali Yildirim and the leader of the nationalist MHP party, which supported the "Yes" vote, to congratulate them, presidential sources said. They quoted Erdogan as saying the referendum result was clear.  The result appeared short of the decisive victory that Erdogan and the ruling AK Party had campaigned aggressively for. In Turkey's three biggest cities - Istanbul, Izmir and the capital Ankara - the "No" camp appeared set to prevail narrowly, according to Turkish television stations.


  • Trump aide McMaster: Time for tough talks with Russia (Reuters)   White House national security adviser H. R. McMaster said on Sunday it was time for tough talks with Russia over its support for Syria's government and its "subversive" actions in Europe.  Speaking on ABC News' "This Week" program, McMaster said Russia's backing of Syrian President Bashar al-Assad's government has perpetuated a civil war and created a crisis that has bled over into Iraq, neighboring countries and Europe.

"So Russia's support for that kind of horrible regime, that is a party to that kind of a conflict, is something that has to be drawn into question as well as Russia's subversive actions in Europe.  And so I think it's time though, now, to have those tough discussions Russia."


  • A $165 Billion Manager Says the Japanese Stock Gloom Is Overdone (Bloomberg)  Japanese stocks have been battered so badly that they’re too cheap to ignore, says Hiroshi Matsumoto, head of Japan investment at the $165 billion investor Pictet Asset Management Ltd., after the Topix index tumbled to its fifth straight weekly loss.  Matsumoto gave two reasons why he’s bullish:

The market is undervalued because investors are overly pessimistic about the next round of quarterly earnings starting in two weeks, and about the risks associated with North Korea. Once people realize they’re being too negative, Tokyo stocks should rise.

North Korea

  • Kim Jong Un’s Big Nuclear Push Is Closing In on America (Bloomberg)  Kim Jong Un has sped up North Korea’s nuclear program since he took power in late 2011, testing more powerful weapons and developing longer-range missiles to carry them. His regime is thought to possess rockets that can hit South Korea and Japan with as many as 20 atomic bombs, and it’s now focused on building a long-range missile capable of hitting Washington, D.C., with a nuclear warhead.

Click for large image.


  • Trump Ties China Currency Decision to Help With North Korea (Bloomberg)  President Donald Trump explained the decision to not label China a currency manipulator, which reversed a promise he made during the election campaign, as a function of receiving Beijing’s help in reining in North Korea.  Trump said in a tweet early Sunday to his 28 million followers:

“Why would I call China a currency manipulator when they are working with us on the North Korean problem? We will see what happens!” 

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

  • This 75-Year Harvard Study Found the 1 Secret to Leading a Fulfilling Life (Inc.)   For over 75 years, Harvard's Grant and Glueck study has tracked the physical and emotional well-being of two populations: 456 poor men growing up in Boston from 1939 to 2014 (the Grant Study), and 268 male graduates from Harvard's classes of 1939-1944 (the Glueck study).  Due to the length of the research period, this has required multiple generations of researchers. Since before WWII, they've diligently analyzed blood samples, conducted brain scans (once they became available), and pored over self-reported surveys, as well as actual interactions with these men, to compile the findings.  The conclusion? According to Robert Waldinger, director of the Harvard Study of Adult Development, one thing surpasses all the rest in terms of importance:

"The clearest message that we get from this 75-year study is this: Good relationships keep us happier and healthier. Period."

"It's not just the number of friends you have, and it's not whether or not you're in a committed relationship.  It's the quality of your close relationships that matters."

Labour's proposed changes to the Reserve Bank are sensible and worth trying. They will certainly do no harm, and might bring real benefits.

The proposal adds full employment to the bank's current mandate of price stability. This would give the bank the dual mandate under which the American central bank, the Federal Reserve, has operated since the 1970s.

The theory is that the bank's task of setting interest rates should reflect not just the value of stable prices, but jobs as well. This is a bit like arguing for both motherhood and apple pie, however, so the theory matters much less than the actual practice of central banks.

Some argue that central banks with a dual mandate really ignore the employment part of the equation and just concentrate on controlling inflation. If the Reserve Bank in New Zealand did this, then Labour finance spokesman Grant Robertson's reform would make no difference in practice.

There is, however, an argument that central banks should take employment seriously and that concentrating solely on inflation is harmful. Critics of the European Central Bank, for instance, which has only a single mandate, says the Eurozone has as a result been stuck in a damaging cycle of austerity and high unemployment.

In the 1970s, Canadian psychologist Bruce Alexander and a group of colleagues at Simon Fraser University tested the widely believed hypothesis that drugs such as morphine are intrinsically addictive. They took two groups of rats and placed the first in the standard laboratory cages used at the time: small and cramped with little space to move and interact. The second they put in the ‘Rat Park’: a spacious enclosure filled with wood chips, platforms, running wheels and tin cans.

Alexander and his colleagues introduced two types of liquid for the rats to drink: water and morphine solution. The caged rats consumed significantly more morphine than their ‘Rat Park’ counterparts. Alexander and his colleagues concluded that there was something about the living conditions of the isolated rats that meant that they were more likely to drink the morphine; the ‘Rat Park’ rats tended to avoid it. Whilst these results have subsequently been disputed, it is an attractive allegory for drug consumption and addiction in humans.

Following this line of thought, it is not necessarily the substance that is the problem: many people consume alcohol and other drugs without becoming addicted. Instead, it is more to do with social context. Those hardest hit by addiction are predominantly from economically and socially marginalised groups.

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