Early Bird Headlines 07 May 2015
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.
- Bonds Drop With Stocks, Metals to Extend $2 Trillion Global Rout (Bloomberg) Bonds and stocks retreated, extending a rout that’s wiped more than $2 trillion from global markets in less than two weeks. Metals fell, along with with emerging currencies.
- Record 38 million people internally displaced by conflict (Al Jazeera) An average of 30,000 people fled their homes every day in 2014, a Geneva-based monitoring group found.
- Gross ‘Short of a Lifetime’ Sours as Bund Slump Surprises (Bloomberg Business) Talk is cheap. Bill Gross should have listened to Bill Gross.
- Wary of bond ‘cliff,’ Fed plans cautious cuts to portfolio (Reuters) Though it ended a stimulative asset-purchase program last October, the Fed is still buying mortgage and Treasury bonds to replenish its $4.5-trillion portfolio as holdings mature. The central bank has said it will keep reinvesting until some time after it begins raising interest rates later this year. The Fed wants to avoid an abrupt contraction in its massive balance sheet next year, when some $500 billion in bonds expire.
- London: a global city viewed with mistrust by the electorate (Financial Times) Since deregulation of Britain’s financial markets enacted by Margaret Thatcher in 1986, the UK has followed a liberalizing trajectory that was accompanied by a public enthusiasm for wealth more commonly associated with the US. London has grown into a global financial center that has become the favored residence of the world’s super rich. By a wide margin, it now boasts more billionaires per capita than any city in the world. But the current election has raised the question of whether British attitudes towards wealth and the wealthy are now shifting. The campaign has aired popular frustration over inequality and affordable housing. There has surfaced the bashing of bankers and growing resentment towards a London that other Brits regard as a distant haven of rapacious hedge funds. The common thread seems to be a suspicion that what is good for the rich may not be so good for everyone else. The wealthy around the globe are now questioning whether they are any longer welcome in London.
- Will tactical voting shape result of the UK general election? (The Conversation) Tactical voting refers to a practice of voting for a candidate with the best chance of defeating your least preferred candidate rather than voting for your most preferred candidate. With significant shifts in UK voting patterns tactical voting may be much more prevalent this time around.
- Greece overturns civil service reforms (Financial Times) Even as the Greek government scrambled to reach an agreement on new economic reforms with its creditors in Brussels, it began reversing similar measures agreed during previous bailout negotiations in a parliamentary session in Athens. A new law proposed by the left-wing Syriza-led government and passed Tuesday night opens the way to rehire thousands of workers cut loose from the country’s inefficient public sector in a reform enacted by the previous government. Econintersect: Looks like the gauntlet has been thrown down. The next step could be a referendum in Greece; if that produces a pro-Syriza result then the Troika will change course or a Grexit will be the result.
- For the sake of Greece they must get the Golden Dawn trial right (The Conversation) There is a fine line between a criminal conspiracy to commit serious offenses and a political party when it comes to propaganda. Individuals may have conspired to commit murder in order to advance a political party’s agenda but how do you prove the party was “a party” to the political conspiracy?
- Israel lurches right with formation of new government (Al Jazeera) Benjamin Netanyahu’s government will maintain status quo abroad, push right-wing entrenchment at home.
- China warns Philippine military planes away from disputed sea area: Manila (Reuters) China could be “testing the waters” to see if it can enforce an air exclusion zone above the Spratly archipelago of the South China Sea, close to the Philippine coast.
- Canada’s Trade Deficit Widens to Record C$3.02 Billion in March (The Wall Street Journal) Canada’s trade deficit expanded to 3.02 billion Canadian dollars ($2.50 billion) in March, from a revised deficit of C$2.22 billion in February. The March trade deficit is the biggest on record, the data agency said, surpassing the previous C$2.87 billion deficit recorded in July, 2012.
- NDP wins stunning majority in Alberta election, Jim Prentice resigns (The Toronto Star) Hat tip to David Dayen, Naked Capitalism. Dayen: “I’m told this is akin to Bernie Sanders winning the Governor’s race in Texas.” The left-leaning New Democratic Party won 53 of 86 seats (62%), while the incumbent majority party (actually a dynasty), the Progressive Conservatives, finished third (behind the fiscally conservative Wildrose Party) with only 10 seats (12%). The center-right Progressive Conservatives had controlled the Alberta government without interruption from 1971-2015. At 44 years, this was the longest unbroken run in government at the provincial or federal level in Canadian history.
- Leftist Party’s Win in Alberta May Affect Future of Oil Sands (The New York Times) Canada’s most conservative province has elected a left-wing party in a landslide election. The Alberta oil sands have been developed with a light regulatory touch under the previous center-right Progressive Conservatives (see previous article), which may well change under the new government. The collapse in oil prices had put the previous administration into a budget crisis as the province depended heavily on oil revenues. The historical importance of oil to the province is reflected in the names of their two National Hockey League teams, the Edmonton Oilers and the Calgary Flames.
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