Written by Econintersect
Early Bird Headlines 24 February 2017
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 lose ground; Samsung Group execs offer to resign, Standard Chartered earnings ahead (CNBC) Markets in Asia traded mostly lower on Friday, with Samsung Group in focus after reports said senior executives tied to an ongoing corruption scandal offered to resign, while its flagship brand introduced new transparency measures to handle large financial donations. The dollar index traded at 101.00 at 2:16 p.m. HK/SIN on Friday, falling from levels near 101.60 reached earlier in the week. U.S. West Texas Intermediate fell $0.12, or 0.2%, to $54.33 a barrel by 0323 GMT, having closed up 1.6% in the previous session. It was on track for a weekly gain of about 1.8%, which would be its strongest so far this year. Brent crude was trading down $0.12, or 0.2%, at $56.46.
US turns into ‘oil nation’ with record exports, ‘eating’ OPEC market share (CNBC) The U.S. exported a record amount of crude oil, topping a million barrels a day for a second week and filling the gap in world markets created by OPEC cutbacks. Shale and other U.S. producers sent 1.2 million barrels of crude oil onto world markets last week, up nearly 200,000 barrels a day from the week earlier and about 350,000 barrels above the four-week average, according to Energy Information Administration data. Until recently, the U.S. was exporting about 500,000 barrels a day.
U.S.
White House hints at crackdown on recreational marijuana (The Hill) White House press secretary Sean Spicer on Thursday suggested the Trump administration will step up enforcement of federal laws against recreational marijuana. It’s the latest sign President Trump is poised to take a tougher approach than the Obama Justice Department did in states that have legalized the use of recreational marijuana. Econintersect: We call hypocracy on this. The party and administration that claims to champion states rights will trample on then when it suits their social ideology.
Pence to CPAC: Obamacare Will Fall Despite ‘Liberal Activists’ (NBC News) Vice President Mike Pence issued a proclamation to the Conservative Political Action Conference Thursday: the “Obamacare nightmare is about to end.” Pence told the fired-up conservative crowd that the Affordable Care Act, commonly known as Obamacare, would soon be repealed and replaced, no matter the raucous town halls nationwide packed with supporters of the health care law. Full address:
How to fix healthcare – and avoid a backlash (Employee Benfits Advisor) (Econintersect: For an investigative report on one reason why American healthcare is expensive and less effective than other countries, see When Evidence Says No, But Doctors Say Yes.) Health reform policy is hard, Len Nichols, director of the Center for Health Policy Research and Ethics at George Mason University, told brokers gathered Tuesday in Washington for the National Association of Health Underwriters’ annual Capitol Conference. But he has a solution. Nichols said:
“There are some that think the most important thing about healthcare spending over time is not the level [of spending,] but the growth rate. Therefore, the most important thing is to block grant Medicaid and have fixed growth rates, turn Medicare into a voucher program that has fixed growth rates, and then let the market take care of itself.”
Weakened Democrats, Opting for Total War on Trump, Bow to Their Voters (The New York Times) Reduced to their weakest state in a generation, Democratic Party leaders will gather in two cities this weekend to plot strategy and select a new national chairman with the daunting task of rebuilding the party’s depleted organization. But senior Democratic officials concede that the blueprint has already been chosen for them – by an incensed army of liberals demanding no less than total war against President Trump.
White House adviser asked FBI to dispute Russia reports (Associated Press) White House chief of staff Reince Priebus asked a top FBI official to dispute media reports that President Donald Trump’s campaign advisers were frequently in touch with Russian intelligence agents during the election, a White House official said late Thursday. The official said Priebus’ request came after the FBI told the White House it believed a New York Times report last week describing those contacts was not accurate. As of Thursday, the FBI had not stated that position publicly and there was no indication it planned to. The New York Times reported that U.S. agencies had intercepted phone calls last year between Russian intelligence officials and members of Trump’s 2016 campaign team.
Trump admin rescinds plan to reduce private prison use (The Hill) The Trump administration is rolling back an Obama-era plan to phase out the federal government’s use of private prisons. Attorney General Jeff Sessions sent a memo Thursday to the Bureau of Prisons rescinding the Obama administration’s Aug. 16 order advising the bureau not to renew any contracts with private prisons, according to a copy of the letter.
A Town Hall with Constituents but No Senator (The New Yorker) When congressmen don’t show up, supporters try to answer questions on their behalf. This sometimes turns confrontation to laughter.
UK
Top City grandees and politicians come out against London Stock Exchange merger (City A.M.) Forty top eurosceptics from the worlds of business and politics have come out against the London Stock Exchange’s proposed £21 billion ($26.5 billion) mega-merger with Deutsche Boerse, calling for the deal to be blocked until after Brexit negotiations. They say the deal, which is currently being evaluated by the European Commission, is a risk the government should “not be taking now“.
Safe as houses? London property price growth will grind to a halt this year (City A.M.) House price growth in London slowed to just 6.4% in January – the lowest level for four years – and experts have predicted growth will grind to a halt at some point this year. The last time growth was so sluggish in the capital was June 2013, according to Hometrack’s data. House prices are rocketing in Bristol and Oxford, however, where house prices grew by 9.7% and 9.2% respectively year-on-year in January. The average house price in Bristol is now £263,200, and in Oxford, it’s £430,000 ($332,000 and $542,000). In terms of house price growth, London is now level with Portsmouth. But, of course, the average house price in the capital is much higher, at £486,600, compared to £221,100 in Portsmouth ($613,000 compared to $270,000).
This one graph explains the horrors of London house prices – and why London renters are trapped (City A.M.) New figures from the Office for National Statistics (ONS) show just how ridiculous house price rises have been in the capital over the last six years, and why London renters are also being screwed. This chart shows that, without accounting for inflation, the average house price in London has grown by around 68%. In Great Britain as a whole, house prices have grown by about half that much (32%). Both rents and house prices have risen much faster than wages.
France
How France Could End the European Union (Daily Reckoning) The surge of Marine Le Pen and the political right in France could signal the end of the European Union and the evolution of the European project. Major elections will soon be held in the Netherlands, France and Germany – what some have argued will be the most divided and diabolical political environment Europe has had in decades. This increasing risk is reflected in the increasing spread between French ans German bonds
China
Trump calls Chinese ‘grand champions’ of currency manipulation (CNBC) (Econintersect: We find the president’s opinion on this matter to reflect conditions several years ago and totally not the case today.) President Donald Trump declared China the “grand champions” of currency manipulation on Thursday, just hours after his new Treasury secretary pledged a more methodical approach to analyzing Beijing’s foreign exchange practices. In an exclusive interview with Reuters, Trump said he has not “held back” in his assessment that China manipulates its yuan currency, despite not acting on a campaign promise to declare it a currency manipulator on his first day in office. Trump said (yes, this does sound internally contradictory with the facts – GEI):
“Well they, I think they’re grand champions at manipulation of currency. So I haven’t held back. We’ll see what happens.”
Trump trade policy will likely swing balance of power toward China, economists say (CNBC) U.S. President Donald Trump‘s protectionist tone will likely hand China significant soft power on trade deals, economists said. Diane Swonk, CEO of DS Economics, told CNBC‘s “The Rundown” on Friday that while she didn’t expect the U.S. would label China a currency manipulator, she foresaw more trade tensions. She expected that the administration would use the “back door” of the U.S. Commerce Department to target specific industries as dumping or violating trade rules, going across a spectrum of largely Asian economies to levy tariffs.
