Written by Econintersect
Early Bird Headlines 07 November 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
Asia markets mostly higher, after FBI clears Clinton (CNBC) Asian markets traded higher on Monday, after the Federal Bureau of Investigation (FBI) again cleared presidential candidate Hillary Clinton of potential criminal charges in its private email server probe.
Oil prices bounce after OPEC reaffirms plan to cut output (Reuters) Oil prices rose by over 1% on Monday, pushed up by a statement from the producers’ club OPEC that it was committed to a deal made in September to cut output in order to prop up the market. Brent crude LCOc1 was at $46.12 per barrel at 0746 GMT, up 54 cents, or 1.18%, from their previous close. U.S. West Texas Intermediate (WTI) crude CLc1 was up 61 cents, or 1.38%, at $44.68 a barrel.
U.S.
Magnitude 5.0 earthquake shakes central Oklahoma. (Associated Press) A sharp earthquake centered near one of the world’s key oil hubs Sunday night triggered fears that the magnitude 5.0 temblor might have damaged key infrastructure in addition to causing what police described as “quite a bit of damage” in the Oklahoma prairie town of Cushing.
Clinton’s October Surprise Turns Into November Dud, But Damage Is Done (Bloomberg) It was an extraordinary case of an October surprise morphing into a November dud, but the damage to Hillary Clinton had already been done. FBI Director James Comey’s 11th hour decision to clear Clinton of a crime related to her use of a private e-mail server – again – may help her with late-deciding voters who had doubts about backing her bid for the White House. But it won’t recover all her lost momentum, or change millions of ballots already cast that were potentially swung by the late-October FBI bombshell.
Who will win the presidency? (FiveThirtyEight) For the third day in a row, Donald Trump’s surge momentum has been halted as Hillary Clinton holds on to a very narrow lead in polls.
Donald Trump Used Legally Dubious Method to Avoid Paying Taxes (The New York Times) (Econintersect: This is the latest of a number of articles we have cited that explain ways Donald Trump could have personally lost almost $1 billion in 1995 and not have personally gone bankrupt.) This article describes a questionable maneuver that could have been used called an equity for debt swap. A similar tactic, stock for debt swaps by corporations, was outlawed in 1993. But the move was not outlawed for partnership equity and debt until 2003 (which Sen. Hillary Clinton voted for). Essentially, when casinos owned by Trump partnerships went bankrupt in the early 1990s, holders of $1.3 billion in debt accepted a small fraction of principle repayment in the settlement. The balance would have been forgiven debt for Trump and subject to income tax. But Trump declared that the forgiven debt was actually exchanged for equity in the bankrupt casinos and therefore no income was recognized. His tax lawyers at the time stronger advised against the maneuver:
UK
Enemies of the people: MPs and press gang up on the constitution over High Court Brexit ruling (The Conversation) Politicians and the press made naked attacks on the rule of law and the independence of the judiciary and the grossest distortions of what the court actually decided when it ruled that Brexit action required advance Parliamentary approval. The author asks:
Do any of these politicians or editors really disagree with having independent courts to decide when the government is acting unlawfully? Or do they think that politicians should be able to sack judges when they rule against the government, or pick “tame” judges who never will? Do the newspapers want to incite hatred against our judges? Are they trying simply to intimidate them?
Iraq
Iraq peshmerga attack Islamic State town as army battles in Mosul (Reuters) Iraqi Kurdish peshmerga forces attacked an Islamic State-held town northeast of Mosul on Monday, trying to clear a pocket of militants outside the city while Iraqi troops wage a fierce urban war with the jihadists in its eastern neighborhoods. The first waves of a 2,000-strong peshmerga force entered Bashiqa, some in armored vehicles or Humvees and others on foot, after artillery pounded the town at the foot of a mountain about 15 km (10 miles) across the Nineveh plains from Mosul.
India
U.K. and India’s Migration Row Deepens as Modi and May Clash (Bloomberg) U.K. Prime Minister Theresa May clashed with her Indian counterpart Narendra Modi on Monday as a row over migration threatened to overshadow her attempt to set up a trade deal with India. Modi called on Britain to support more Indian students who want to enroll at universities in the U.K, as he appeared alongside May at a technology summit in New Delhi.
Philippines
Philippine senator seeks to keep Duterte at bay with Supreme Court writ (Reuters) A Philippine senator and the biggest critic of President Rodrigo Duterte filed a “test case” before the Supreme Court on Monday, seeking to fend off what she called harassment by the volatile leader and his public tirades against her. Leila de Lima, the former justice minister who Duterte’s allies removed as head of a Senate probe into his bloody war on drugs, said she had filed a writ of “habeas data” against the president to protect her privacy and if successful, it could take away some of his immunity.
China
China Replaces Finance Minister Lou Jiwei in Surprise Reshuffle (The Wall Street Journal) China replaced its finance minister and two other top officials in a major reshuffle that comes ahead of a Communist Party congress next year. Finance Minister Lou Jiwei, who was widely seen as a voice for reform of China’s fiscal system, was abruptly removed from his position and, according to party officials briefed on the matter, is expected to become head of China’s national pension fund. Mr. Lou, 65 years old, is nearing the age when it is customary for Chinese officials to retire, but the move was nevertheless unexpected
Hong Kong Home Prices Set to Plunge on Policy Change (Bloomberg) Hong Kong leaders’ surprise move to cool the world’s least affordable home market with an increase in the transfer tax (stamp duty) is set to spur an immediate plunge in prices and transactions as buyers and sellers hit the pause button. Shares of developers slumped. Louis Chan, chief executive of the residential unit of Centaline Property Agency Ltd., sees transaction volumes plunging by 60 – 70% in the next three months, and now expects a 5 – 8% drop in prices, after previously projecting an increase in that range. Ricacorp Properties Ltd.’s Willy Liu said transactions will drop 30 – 40% in the next two months and prices will fall 5%.
The Latest: Top Chinese official rebukes Hong Kong lawmakers (Associated Press) A top mainland Chinese official has delivered an emotional rebuke of two Hong Kong lawmakers who used a derogatory term about China, labeling them traitors to the Chinese people. The pair had referred to China during their swearing-in ceremony with an old-fashioned derogatory Japanese term for the country. Li Fei, deputy secretary general of China’s top legislative panel, said Monday that the comments amounted to an intentional smear against all Chinese. See also next article.
China Flexes Legal Muscle to Quash Hong Kong Independence Calls (Bloomberg) China’s top legislative body ruled that Hong Kong people who advocate independence can’t hold public office, a rare intervention designed to prevent two elected “localists” from taking their posts in a case that threatens to spark further unrest. The decision Monday by the National People’s Congress Standing Committee in Beijing represented only its second unilateral interpretation of Hong Kong law since the former British colony was returned to China almost two decades ago. It came amid a court battle over whether a pair of pro-independence activists voted into the city’s legislature in September could take their seats after insulting China in their oaths of office.
Australia
BlackRock Says Australia Could Lose AAA Rating Next Month (Bloomberg) Australia could be stripped of its top credit score by S&P Global Ratings as early as next month if the government’s interim budget review shows further deterioration, according to BlackRock Inc. The Australian government has struggled to rein in its fiscal shortfall as lower commodity prices have crimped revenues and parliament has stymied savings measures. The budget has been in deficit since 2008 and isn’t forecast to return to surplus until at least 2021, according to the fiscal plan released in May. An election in July failed to break the legislative gridlock, prompting S&P to shift its outlook to negative and warn of a possible rating cut.
