Written by Econintersect
Early Bird Headlines 22 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
Markets mostly higher in Asia, shrug off North Korea missile test; ASX up 0.7% (CNBC) Asian equities traded mostly higher on Monday, following the continued recovery on Wall Street last week and as investors digest yet another missile test out of North Korea at the weekend. The dollar rose slightly against a basket of rival currencies, last trading at 97.259, but off levels around the 98 handle seen early last week. Spot gold was almost flat at $1,255.30 per ounce by 0058 GMT. It rose about 0.7% on Friday. U.S. gold futures were up 0.2% at $1,255.50 an ounce. For oil, see next article.
Oil rises on expectation of extended, possibly deepened output cut (Reuters) Oil prices rose on Monday, supported by reports that an OPEC-led supply cut may not only be extended into next year but might also be deepened to tighten the market and prop up prices. Brent crude futures were up $0.32, or 0.6%, from their last close at $53.93 per barrel at 0145 GMT. U.S. West Texas Intermediate (WTI) crude futures were back above $50 per barrel, trading up $0.32, or 0.6%, at $50.65. Both benchmarks have risen more than 10% from their May lows early in the month.
Prices have risen because of expectations that a pledge by the Organization of the Petroleum Exporting Countries (OPEC) and other producers, including Russia, to cut supplies by 1.8 million barrels per day (bpd) would be extended to March 2018, instead of covering just the first half of this year.
The option of deepening the production cut was also being discussed ahead of a meeting of OPEC and its allies in Vienna on May 25, sources said.
U.S.
Medicaid cuts coming in Trump budget: Washington Post (Reuters) U.S. President Donald Trump’s budget proposal, set to be unveiled on Tuesday, will include cuts to Medicaid and propose changes to other assistance programs for low-income citizens, the Washington Post reported on Sunday. The White House did not immediately respond to a request for comment.
A Republican healthcare bill that passed the U.S. House of Representatives in early May seeks to overhaul the national healthcare system and cut more than $800 billion over the next 10 years from Medicaid, the government health insurance program for the poor and disabled.
The healthcare bill faces a difficult time in the Senate, where Democrats and some Republicans worry about its impact on costs for low-income Americans, among other issues.
The Underreported Success of the Trump Presidency (American Thinker) (Econintersect: We should be “chest-thumping” because we have reported every item discussed in this article, both as positive news and also criticisms by Trump opponents when they were found.) Here is the list from this article:
First and foremost for our culture is the restoration of law and order.
The existing border laws are being enforced.
Illegal crossings are down 70%.
We now have an administration that intends to do something to ensure vote fraud is curtailed.
Another major push is for economic revitalization.
The undoing of so many bad regulations from prior administrations is one giant step, with more underway.
The first step in positive change to the failing Obamacare is a good sign.
The Trump team has put together a burgeoning alliance in the Middle East, one that includes Jordan, Saudi Arabia, Israel, Egypt and others.
Trump’s clear skill in negotiating and forming relations with China’s premier was extraordinary.
China is helping us with the Korean mess.
Saudi Arabia, UAE pledge $100 million to ethically questionable fund proposed by Ivanka Trump (Think Progress)
Saudi Arabia and the United Arab Emirates have pledged $100 million to the World Bank’s Women Entrepreneurs Fund, an initiative proposed by first daughter and senior White House adviser Ivanka Trump. The fund, which was first announced in April, has already raised serious legal and ethical questions about how a White House adviser can both shape foreign policy and actively solicit donations from foreign countries for the fund.
According to the Wall Street Journal, the initiative would provide technical assistance and investments for projects that support the economic empowerment of women around the globe. Ivanka Trump does not control the money, though she first pitched the idea to World Bank Group President Jim Yong Kim and has discussed the idea with leaders such as German Chancellor Angela Merkel.
On Sunday, World Bank Group President Jim Yong Kim praised “Ivanka’s leadership” in spearheading the fund, and called it “a stunning achievement.”
President Donald Trump was extremely critical of Saudi Arabia’s contributions to the Clinton Foundation while campaigning against Hillary Clinton, going so far as to call for Clinton to return all the money given to the foundation, both in speeches on the campaign trail and during the October presidential debate.
Here’s Why the Fed Will Stay Central to Markets (The Wall Street Journal) Federal Reserve officials grappling with the legacy of expansive stimulus would find it difficult to return to the central bank’s precrisis role on the sidelines of financial markets, analysts and central-bank watchers say.
A long list of programs adopted to help foster economic growth, along with changes in money markets and bank regulation, have vastly expanded the Fed’s balance sheet and its involvement in markets. The Fed’s assets now total $4.5 trillion, up from less than $1 trillion a decade ago. Since 2013 the central bank has become one of the largest traders with U.S. taxable money-market funds, according to Crane Data.
Many analysts and investors worry that significantly rolling back the Fed’s expansion, a course advocated by some in conservative circles, risks disrupting markets and the economy at a time when growth remains tepid. It would also reduce the connections the institution has built with a diverse set of Wall Street firms, beyond the group of banks it dealt with before the crisis.
Worries mount about vacancies in Trump’s State Department (The Hill) Concerns are growing about a short-staffed State Department dealing with a host of international crises. As President Trump begins his first foreign trip, seven of the nine senior State Department roles under Secretary Rex Tillerson remain vacant, including his top deputy. The only two officials in senior roles were appointed by former President Obama and have been kept on.
While the Trump administration has put the blame on Senate Democrats and the slow confirmation process, others say Trump has been slow to issue nominations.
There are roughly 200 positions at the State Department that require Senate confirmation, including key ambassadorships, the vast majority of which remain unfilled more than 100 days into the new administration.
How long can Mike Pence play dumb? (Think Progress) As the Trump White House lurches from crisis to crisis, Mike Pence has a simple message: It wasn’t me. Against the backdrop of constant White House scandal, Pence has cast himself either in the role of “victim” or “stabilizing” force. These efforts have recently become more public and more brazen. Pence’s press secretary on Thursday, for example, promoted a story on Fox News declaring that Pence has taken “the lead” in advancing the White House agenda and describing him as “a stable presence during crisis.”
EU
Brexit barriers ‘would harm science’, say universities (BBC News) Barriers to research collaboration in Europe as a result of Brexit would harm scientific progress, says a group of leading UK universities. Science and research should be a priority in the talks between the UK and the EU, says the Russell Group of research intensive universities. Any barriers “would be bad for the UK and bad for Europe“, said the group’s acting director, Tim Bradshaw.
UK
General election 2017: New warning over social care plans (BBC News) Tory plans to change how social care is funded in England could be derailed by councils, a former minister has warned. The party wants to include the value of someone’s home when deciding how much they must pay towards care at home – but allow them to pay after they die. The Conservatives say the changes ensure fairness across the generations.
But Sir Steve Webb, the ex-Lib Dem pensions minister, says there is already a “lottery” in the way councils use existing deferred payment schemes.
Currently, people living in residential care can ask their local authority to pay their bill and recover the money from sale of their family home after they die.
The Conservatives’ plan would extend this right to those receiving care in their own homes, who would have to pay until they were down to their last £100,000.
Nepal
Two more deaths take Everest toll to at least five in past month (Reuters) Two more climbers have died on Mount Everest, taking the death toll on the world’s highest mountain in the past month to at least five amid mountaineers’ safety concerns, officials said on Monday. A 54-year-old Australian, Francesco Enrico Marchetti, died on the Tibetan side of Everest, while Vladimir Strba, 48, of Slovakia, perished near the Balcony in the south in Nepal, officials said. Both climbers died on Sunday. Marchetti died due to apparent altitude sickness about 8,300 meters (27,230 feet) above sea level while on his summit approach. Strba died at around 8,400 meters (27,500 feet) in the “death zone“, on the Nepali side where the air is very thin, Tourism Department official Gyanendra Shrestha said on Monday. Econintersect: Why do they climb into such danger? George Mallory, the first known alpiner to attempt the world’s highest peak, gave the reason before his death near the summit in 1924:
Because it’s there.
China
Chinese paper applauds anti-spy efforts after report CIA sources killed (Reuters) An influential state-run newspaper applauded China’s anti-espionage efforts on Monday after The New York Times said China had killed or imprisoned up to 20 CIA sources, hobbling U.S. spying operations in a massive intelligence breach. The Chinese killed at least a dozen people providing information to the U.S. Central Intelligence Agency between 2010 and 2012, dismantling a network that was years in the making, the New York Times reported on Saturday. China’s Global Times, published by the official People’s Daily, said in an editorial in its Chinese and English-language editions that, if true, it was a victory for China.
China Yield Curve is Predicting Up to 10 Bad Years (Twitter) To be more exact, the current negative yield curve is steepest from 7 to 10 years, indicating highest probability for trouble for the economy in that time frame.
Australia
Cave dig shows the earliest Australians enjoyed a coastal lifestyle (The Conversation) Part of the land inhabited by some of the early Australians is now submerged, but details of their life is now revealed in an excavation on an island off the continent’s north-west coast. As the dates for the first Aboriginal arrival in Australia are pushed back further and further, it is becoming clear how innovative the original colonists must have been. The latest excavations are for sites used as much as 50,000 years ago.
