What We Read Today 09 May 2014

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 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.

• Apple in talks for $3.2bn Beats deal (Matthew Garrahan and Tim Bradshaw, Financial Times) In what would be Apple’s largest acquisition ever, the Financial Times has an exclusive on the reported purchase of Beat Electronics, a headphone maker and streaming music operator. If the deal is finalized it will make former American Idol mentor Jimmy Iovine and hip-hop star Dr. Dre very rich, as well as return approximately a 300% return to the Carlyle Group which acquired nearly 50% equity in Beat just eight months ago for $500 million.

• White House reviews crude oil export ban (Gregory Meyer and Ed Crooks, Financial Times) Special presidential advisor John Podesta has revealed that the White House is evaluating the possibility of allowing exports of crude oil from the U.S., a practice that has been banned since legislation was passed in 1975. That legislation give the president the authority to loosen the ban by executive order. The problem has arisen because the surge in shale oil production has created a glut of oil in the U.S. which cannot be reduced by refining because the new oil is low-sulphur and many American refineries are set-up for high-suphur oil which comes from Latin America and Saudi Arabia, among other places.

• Best ETFs to Own for Rising Inflation (Simon Constable, Barron’s)

Consider buying stocks in the energy and materials industries as they are seen as “late-cycle” sectors. They are “favored by investors as an economic cycle matures and inflationary pressures begin to build,” writes Steven Pytlar, chief equity strategist at Prime Executions in a recent note. “These sectors are also seen as inflation hedges.”

That means look at Energy Select Sector SPDR (ticker: XLE) and iShares U.S. Basic Materials (IYM) exchange-traded funds, which track stocks in their sectors, as well as the usual standby gold.

• India’s Bourgeois Revolution (Shashi Tharoor, Project Syndicate) The nature of politics in India is changing from being only the purview of professional politicians to having more citizens running for office including well educated young professionals. That seems to be raising the quality of the political professional as well with “a new generation of educated articulate, and forward thinking politicians raising the standard of Indian politics“.

• The Changing Nature of Middle Class Work (Charles Hugh Smith, Of Two Minds) This article is the third in a series about the decline of the middle class. In this article Charles discusses the changing structure of the economy and how it is revolutionizing the nature of work itself. The article is a summary of the following discussion between Charles and Gordon T. Long.

Today there are 14 articles discussed ‘behind the wall’.

Please support all that we do at Global Economic Intersection with a subscription to our premium content ‘behind the wall’.

You get a full year for only $25.