Written by Econintersect
​Early Bird Headlines 02 May 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.
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Global
Asia trades mixed; Reserve Bank of Australia leaves cash rate unchanged as expected (CNBC) Asia markets traded mixed on Tuesday as most major exchanges outside of Tokyo resumed after being shut for a public holiday on Monday. Tthe dollar index, which measures the greenback against a basket of currencies, traded at 99.04, climbing from levels near 98.88 in the previous session. Brent crude for July delivery was down $0.07, or 0.1%, at $51.45 by 0021 GMT, after settling down $0.53 on Monday. NYMEX crude for June delivery was down $0.10 cents, or 0.2%, at $48.74. Spot gold was steady at $1,256.60 per ounce, as of 0052 GMT.
U.S.
GOP suffers surprise defection on Obamacare repeal (Politico) Hat tip to Patrick W. Watson. Republicans are having trouble getting enough votes to pass any Obamacare repeal that does not include coverage for pre-existing conditions. And the task was made even harder by an unforced error from Trump. The president told Bloomberg News in an interview Monday morning that the bill might change to provide more protections to people with preexisting conditions. But time is running out. Right now the repeal could be passed with 51 votes in the Senate. Once the agenda moves to tax reform, healthcare will require 60 votes as the special cloture rules will be removed.
Provision to kill DOL fiduciary rule left out of funding bill (Investment News)
Former British Prime Minister Winston Churchill once said that there’s nothing more exhilarating than being shot at and missed. By that standard, supporters of the Department of Labor’s fiduciary rule must be feeling downright giddy.
A provision to kill the rule was kept out of a $1.07 trillion bill lawmakers agreed to over the weekend to fund the federal government through the end of September. Republican lawmakers had been pushing to add the measure, but Democratic leaders in the House and Senate refused to allow so-called “posion pill” riders. The spending bill is likely to be approved later in the week.
Treasury’s Mnuchin: Trump’s tax cut plan eliminates all but two loopholes (CNBC) President Trump’s tax plan adheres to the “Mnuchin Principle” of helping the middle class, the Treasury secretary says. The Trump tax plan was vague because the president wants to work with Congress on getting it done, Mnuchin says. Mnuchin argues it’ll take some time, but Trump’s policy agenda would lead to “sustained 3 percent economic growth or higher.” The tax-cutting plan aims to eliminate all loopholes except the mortgage interest and charitable giving deductions, Treasury Secretary Steven Mnuchin told CNBC on Monday.
Sold for Parts (ProPublica and The New Yorker) One of the most dangerous companies in the U.S. took advantage of immigrant workers. Then, when they got hurt or fought back, it used America’s laws against them. This exposè describes how migrant workers are victimized by some American corporations, sometimes ending up as crippled discards.
EU
Eurozone Inflation (Walter Kurtz, Sober Look, The Daily Shot) Econintersect: We can’t get too excited about a one-month spike.
UK
UK GDP at 0.3% Q1 2017 (1.2% Annualized) (Walter Kurtz, Sober Look, The Daily Shot)
China
China’s $11 Trillion Economy and Markets Are in a Tug of War (Bloomberg) China’s run of solid economic indicators proved little consolation for its shaky financial markets in April. See graphiic below. The dichotomy stems from a shift in the leadership’s focus toward reducing leverage — one that’s set to determine whether growth joins asset prices in heading down. Economists are practically unanimous in saying that reduced debt loads would be good for China’s longer-term health. The big unknown is whether officials can manage that without a dose of short-term pain. As UBS Group AG analysts put it in a note last week: if authorities’ initiatives are
“not managed well, it could lead to a rise in credit events, excessive liquidity tightening, faster-than-intended slowdown of credit growth, and greater market volatility.”
Brazil
Brazil’s Austerity Dividends (Walter Kurtz, Sober Look, The Daily Shot) See also next item.
Brazilian Sticks on a Tear (Financial Times) While debt-to-GDP and unemployment soar, Brazialian stocks have gone the other way, up more than 30% since last May,
