Written by Econintersect
Early Bird Headlines 15 June 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
Chinese shares erase early losses in wake of delay in MSCI inclusion (CNBC) Chinese mainland markets rose Wednesday, shrugging off a decision by stock index provider MSCI on Tuesday to delay inclusion of mainland-traded Chinese A shares in its key emerging market index. Most other Asian markets also reversed morning losses, despite continued jitters over the possibility the U.K. may opt to exit the European Union as well as concerns over the outcome of the Fed meeting, due later, and the Bank of Japan‘s meeting ending Thursday.
U.S.
How False Equivalence Is Distorting the 2016 Election Coverage (The Nation) The media’s need to cover “both sides” of every story makes no sense when one side has little regard for the truth. Econintersect: Our view is that Donald Trump has devised a brilliant strategy to take advantage of the ‘balanced coverage’ objective to force media to portray the more negative sides of his opponents and downplay some of the more positive aspects they may have shown. The more outrageous his statements the more his opponents’ less attractive pronouncements are publicized.
Virginia GOP rep loses primary (The Hill) The third incumbent House member has been defeated in a primary. Rep. Randy Forbes (R-Va.) became the second House Republican to lose a primary this election cycle, after running in a newly redrawn district. He joins Rep. Renee Ellmers (R-N.C.) who similarly lost a primary due to redistricting. Both states had been forced by court order to correct gerrymandering which concentrated large numbers of Democratic voters into a few districts. The results forced some incumbent Republicans to run in new districts that were not familiar with them. The third defeated incumbent was Rep. Chaka Fattah (D-Pa.) who lost his primary earlier this year amid a federal indictment.
No Other Rich Western Country Comes Close (The Big Picture) An example of “American Exceptionalism”:
Compare These Gun Death Rates: The U.S. Is in a Different World (The New York Times) Here is a comparison of how common death caused by guns is various other countries compared to specific causes of death in the U.S.. For example:
Gun homicides in Spain are about as common as deaths from excessive natural heat in the United States.
Job Market Is Getting Stronger, Not Weaker (Barry Ritholtz, Bloomberg View) W-2 withholding revenue has been rising for three months and year-over-year revenues reported for the current month are up approximately 12% (first graph below). Data (and the graphs below) are from Daily Jobs Update. But longer-term trends do say the labor market is “maturing, and growing less rapidly than before” (second graph below).
EU
Brexit is reopening euro zone sovereign wounds (Reuters) There’s no doubt Brexit would be bad for the rest of the EU. The bigger issue is whether it would trigger copycat referendums. Were that to happen in a euro zone country – France, say – it could trigger the breakup of the whole bloc.
Brexit’s First 100 Days Promise Chaos, Fear, Damage Limitation (Bloomberg) There’s no road map for European authorities facing the prospect of a British exit from their 28-nation union — by design. Officials in Brussels are under orders not to commit any scenarios to paper to avoid alarmist leaks, according to a senior official from one European government tasked with making preparations. Given the potential political and financial shockwaves surrounding a Brexit vote, it’s not clear a map would do much good. Global markets are already sputtering as anxiety mounts about the impact on the world economy. EU President Donald Tusk goes so far as to say that it could spell the end of “western political civilization itself.”
France
California Overtakes France to Become Sixth-Largest Economy (Bloomberg) France has fallen from sixth to seventh in rank of the world’s largest economies. Who moved ahead of them? California. (Of course, if only countries are counted, as in official rankings, France is still sixth.)
Ivory Coast
Ivory Coast farmers face eviction, extortion in drive to save forests (Reuters) Ivorian conservation agents are using the threat of eviction and prosecution to extort money from cocoa growers farming illegally in protected forest reserves, victims and rights groups say. Around 80% of Ivory Coast’s primary forest, once the largest in West Africa, has been chopped down in the five decades since independence, amid an agricultural expansion that helped make it the world’s top cocoa producer and most important economy in Francophone West Africa.
India
Stronger Indian nuclear industry can make n-power more (Business Standard) India’s impending membership to Nuclear Suppliers Group (NSG) can “effectively” address concerns regarding certainty of trading rules and technology access, according to Foreign Secretary S Jaishankar. He said that with India entering that market nuclear power would become more competitively globally.
Year’s first trillion-dollar bull market is nearing in India (Bloomberg) Traders are shrugging off the most expensive stock valuations since 2011, sending Indian shares back toward a bull market amid forecasts for the strongest monsoon in two decades and data showing the nation growing faster than all other major economies. Inflows may continue as the benefits of Prime Minister Narendra Modi’s policies emerge in corporate earnings reports, investors including Mark Mobius and BNP Paribas SA said.
Japan
Japan Unswayed by Increased Pressure to Disavow Coal Support (Bloomberg) Japan, faced with increasing calls from environmentalists to phase out coal, is standing by its support of the fossil fuel, saying it will help developing countries adopt the best available technologies for coal-fired power plants. Asian countries such as India and Indonesia are planning to add more coal capacity to meet growing power demand. Japanese companies such as Toshiba Corp. have plans to supply equipment to such coal-fired plants, while the state-owned Japan Bank for International Cooperation has provided loans for projects abroad. Domestically Japan has increased coal burning by 24% since 2011.
China
China’s South China Sea Meeting With Asean Ends in Disarray (Bloomberg) A meeting in China of foreign ministers from Southeast Asian nations over the South China Sea has ended in confusion after Malaysia released and then retracted a joint statement expressing “serious concerns” over developments in the disputed waterway. The disarray raises fresh questions about unity within the 10-member Association of Southeast Asian Nations over the issue, ahead of an international court ruling on a Philippine challenge to China’s claims to more than 80% of the waterway. Asean operates on consensus, which means all members need to agree on a statement before it is released.
Fears in China’s ‘Silicon Valley’ that property boom will hurt tech boom (Reuters) A housing boom in China’s wannabe “Silicon Valley” of Shenzhen risks undermining the city’s tech boom as young professionals consider moving out to avoid the highest residential prices in the country. In the space of four decades, Shenzhen has transformed itself from a fishing village into a manufacturing center and now a tech hub – attracting top firms and young talent in sectors including technology, advertising and design. But a property frenzy, which has driven prices up by 580% in the past 10 years, is beginning to weigh on the city’s competitiveness, tech firms, professionals, industry groups and officials say, just as it strives to develop new economic drivers and pull away from old-economy manufacturing.
