Written by Econintersect
Early Bird Headlines 16 July 2016
Econintersect: Here are some of the headlines we found to help you start your day. For more headlines see our afternoon feature for GEI members, What We Read Today, which has many more headlines and a number of article discussions to keep you abreast of what we have found interesting.
Global
What’s the Problem With Protectionism? (Barry Eichengreen, Project Syndicate) BE has contributed to GEI. Eichengreen says that protectionism raises prises which is a good thing when facing deflation. But he doesn’t want to endorse it:
Tariff protection may not be bad macroeconomic policy in a liquidity trap. But this doesn’t make it good foreign policy – for Trump or anyone else.
U.S.
Online prices are showing signs of deflation (CNBC) Billions of online transactions are tracked on a daily basis by Adobe and show that deflation is rampant across several consumer categories. Prices are falling fast in the Adobe Digital Price Index (ADPI), which measures 80 percent of all online transactions from the top 100 U.S. retailers. The very large sample size of the ADPI means that it has a lower margin of error and is also weighted to quantities sold.
On foreign policy, Donald Trump makes George W Bush look like a colossus (The Guardian) Columnist Richard Wolfe unloads on “The Donald”. He compares Trump’s foreign policy credentials to those of George W. Bush, who was pretending to march to the Battle Hymn of the Republic at the memorial service for the five police officers murdered by a sniper in his hometown of Dallas. Econintersect: You have to read the column to see how much muck Wolfe can stir up in just a few hundred words.
Treasury Snapshot: The Flight to Treasuries (Jill Mislinski, Advisor Perspectives dshort.com) Treasuries are right in the middle of a 10-year downtrend channel.
France
François Hollande faces political backlash after Nice attack (The Guardian) François Hollande is facing a severe political backlash in the wake of the Nice attack as rightwing politicians accused him of failing to implement sufficiently effective security and intelligence measures after previous atrocities. The French president, who travelled to Nice with the prime minister, Manuel Valls, after delivering an ashen-faced TV address at 4am from the presidential palace, was under pressure to explain what concrete measures he had taken since the Paris attacks in November to crack down on the threat of terrorism. The motivation for Thursday’s attack is not yet known, but it is being investigated as an act of terror.
Turkey
Turkish coup bid crumbles as crowds answer call to streets, Erdogan returns (Reuters) An attempted Turkish military coup appeared to crumble in the early hours of Saturday after crowds answered President Tayyip Erdogan’s call to take to the streets to support him. Erdogan, who had been holidaying on the southwest coast when the coup was launched by a faction in the armed forces, flew into Istanbul before dawn on Saturday and was shown on TV appearing among a crowd of supporters outside Ataturk Airport. The uprising was an “act of treason“, and those responsible would pay a heavy price, he later told reporters at a hastily arranged news conference. Arrests of officers were under way, and it would go higher up the ranks, culminating in the cleansing of the military, he said.
Erdogan Has Nobody to Blame for the Coup But Himself (Foreign Policy) This columnist says that years of broken promises and deepening paranoia have earned the Turkish president his comeuppance. See also Turkey’s Continental Divide (Bloomberg).
Fethullah Gülen: who is the man blamed by Turkey’s president for coup attempt? (The Guardian) The accusation by Turkey’s president, Recep Tayyip ErdoÄŸan, that US-based cleric Fethullah Gülen is behind Friday night’s attempted coup is part of a familiar rhetoric and a long-running rivalry. So is there any truth in it? It is probably worth pointing out in the first instance that the traditional rivalry in Turkish society has been between secularists (including those in the army) who look to the modern state’s founder, Kemal Atatürk, and Islamists – not least Erdogan’s AKP party, which has provoked a number of coups or attempts in Turkish history. The military has long seen itself as the guardian of modern Turkey, and the movement lead by Gülen occupies a sort of murky gap between the two sides. Gülen, a cleric living in reclusive exile in Pennsylvania, leads a popular movement called Hizmet. It is a hodge-podge that at times has appeared cultish – spawning think tanks, businesses, schools and publications across the globe, while building up substantial wealth and influence in the process. According to some reports, 10% of the Turkish population is estimated to support Hizmet.
Tunisia
Why Does Tunisia Produce So Many Terrorists? (Foreign Policy) Analysts are having difficulty deciding why Tunisia is a disproportionate source of radical extremists. This stands in rather stark contrast to Tunisia’s remarkable progress at establishing democratic institutions. The country has held several rounds of free and fair elections, and it now boasts a vibrant range of free media and civil society groups. Tunisia is a paradox, a jarring dichotomy between burgeoning liberalization and brewing jihad. The author says this should remind us once again that the plague of Islamist terror isn’t reducible to simple causes. The fact that Tunisians have been dominated by strongly secularizing regimes for the past 60 years might well help to explain why democracy has taken root with such surprising success since 2011. But it also seems clear that that same modernizing trend has fueled an intense backlash among traditionalist Muslims, often to radical effect. The fate of Tunisia, and its much-lauded democracy, will now depend on how well the country can figure out how to bridge the gap.
China
How high can China’s population possibly go? Ambitious urban plan to house 3.4 billion people sparks concern (South China Morning Post) Ambitious expansion plans by small and medium towns across China have lead to the creation of more than 3,500 “new areas” for residential and economic use raising fears many are destined to become ghost towns. The combined projected population of these new areas is an “impossible” 3.4 billion people – 2.5 times the current number of people in the country, experts say. The world’s population today stands at 7.3 billion, according to the US Census Bureau. Econintersect: Numerous analysis papers we have seen estimate that China has reached, or soon will reach, peak population and a gradual decline will soon begin.
China to prosecute prominent rights lawyer on subversion charges (Reuters) China will prosecute a prominent Chinese human rights lawyer on charges of subverting state power after months of secret detention, prosecutors said on Friday, the latest move by authorities to crack down on dissent. President Xi Jinping’s administration has tightened control over almost every aspect of civil society since 2012, citing the need to buttress national security and stability. China consistently rejects any criticism of its human rights record, saying it adheres to the rule of law, that all are equal under the law and that those who break the law can expect to be punished. Dozens of lawyers and activists associated with the Beijing Fengrui law firm have been swept up in the crackdown and held since last July, triggering concern in Western capitals. The firm has represented several high-profile clients, including the ethnic Uighur dissident, Ilham Tohti. State media has accused the firm and its associates of orchestrating protests outside courts and politicizing ordinary legal cases in order to attract international attention.
Australia
The new rise of Nauru: can the island bounce back from its mining boom and bust? (The Conversation) This tiny island nation in Micronesia is heavily dependant on Australia and many have identified it as a “client state” of that country. It has fallen from one of the world’s wealthiest nations per capita “to a society plagued by financial mismanagement and corruption“. The economic decline follows the depletion of the island’s extensive phosphate deposits, the mining of which has left an environment wasteland.
Recovering from the mining boom and bust has been a slow process. In 1993, Nauru settled a landmark international legal case, in which Australia agreed to pay reparations for colonial-era mismanagement of the island’s assets. This provided substantial funds for environmental restoration through the Nauru Rehabilitation Corporation (NRC).
