Early Bird Headlines 11 June 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.
Global
- Developing nation growth slowing, warns World Bank (Financial Times) Developing countries are facing a “structural slowdown” likely to last for years and are ceding their role as the world’s growth engine to more mature economies such as the US, according to the World Bank. The Washington-based bank on Wednesday lowered its forecast for global growth this year to 2.8%.
- The Impunity Trap (Project Syndicate) Jeffrey Sachs bemoans the endemic corruption of the (primarily) financial world.
The ability of those who wield great public and private power to flout the law and ethical norms for personal gain is one of the more glaring manifestations of inequality. The poor get life sentences for petty crimes, while bankers who fleece the public of billions get invitations to White House state dinners. A famous ditty from medieval England shows that this is not a new phenomenon:
The law locks up the man or woman
Who steals the goose off the common
But leaves the greater villain loose
Who steals the common from the goose.
U.S.
- Majority of US commuter railroads will not meet new safety requirements (The Guardian) Congress considers extending deadline for implementing equipment to prevent derailments amid hearing into Amtrak crash that left eight dead last month.
- What Does California Gov. Jerry Brown Know about the Next Crash and Recession that We Don’t? (Wolf Street) Gov. Brown is pushing hard to continue state surpluses which will only be needed in reserve when the next recession arrives. It is SOP (standard operating procedure) for politicians not to worry about that until the recession is well underway.
EU
- Small Steps to European Growth (Project Syndicate) The topics chosen by the European Central Bank (ECB) for its annual forum in Sintra, Portugal, at the end of May were not deflation, quantitative easing, or financial stability. They were unemployment, productivity, and pro-growth reforms. Mario Draghi and the ECB think the retrograde thinking of the controlling political forces in the EU need to change.
- The QE Placebo (Project Syndicate) [W]hether the ECB’s decision to pursue QE can be justified ultimately depends on its impact. But, after six months, that impact remains difficult to assess.
UK
- Mark Carney to extend tough new rules for market abuse (Financial Times) Punitive new rules for senior bankers will be extended to cover thousands of asset managers, hedge funds and even the Bank of England itself. Econintersect: Will bankster bosses finally be subject to the law? How soon in the U.S.?
- Government to sell off stake in RBS at a loss – seven years after the bank was bailed out (Daily Express) Mr Osborne said the decision to pull out of RBS came after an independent review concluded the losses to the taxpayer would be offset by profits from the sale of other financial share sales – including Lloyds Banking Group.
- Growth, what growth? Thatcherism fails to produce the goods (The Guardian) Cambridge University analysis casts doubt on free market economics showing GDP and productivity grew faster before 1979. What has increased since 1979 has been unemployment and inequality.
Germany
- Germany to Consider Offering Tsipras Staggered Deal on Aid (Bloomberg) Did Merkel just blink?
Turkey
- The Kurds in Command (Project Syndicate) In a remarkable change of fortune, Turkey’s long-marginalized Kurdish minority is poised to play a pivotal role in the country’s politics. In the parliamentary election on June 7, the pro-Kurdish Peoples’ Democratic Party (HDP), received nearly 13% of the popular vote, giving it an expected 80 seats in the 550-member National Assembly. The result represents a sea change for Turkish politics, for it marks the first time that a primarily Kurdish party has cleared the 10% electoral threshold to enter the parliament.
China
- China approves US$19.3b of airport, rail projects (The Business Times) China’s top economic planner said it had given the green light to over 120 billion yuan worth of airport and railway projects, the latest slew of infrastructure approvals as Beijing looks to avert a sharp slowdown in the economy.
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