Written by Econintersect
Early Bird Headlines 02 April 2018
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, published Monday, Wednesday and Friday, 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 markets lose steam to close lower as investors digest China tariffs (CNBC) Asia Pacific stocks finished the first trading day of the quarter on a weaker note as markets reversed gains seen earlier in the day. Markets also digested new tariffs on U.S. goods announced by China on Monday after Beijing floated the proposal last month. The dollar index was mostly steady at 89.972 at 2:53 p.m. HK/SIN. U.S. WTI crude futures were at $65.18 a barrel at 0025 GMT, up $0.24 cents (0.4%). Brent crude futures were fetching $69.67 per barrel, up $0.33 cents, or 0.5%. Spot gold edged up 0.4% to $1,329.24 per ounce at 0343 GMT.
U.S.
- Trump demands ‘nuclear option’ and ‘no more DACA deal’ (The Hill) President Trump said Sunday that Republicans must change Senate laws in order to pass tougher border and immigration legislation. In a position shift, he also said the GOP should no longer make a Deferred Action for Childhood Arrivals (DACA) program deal with Democrats.
- ‘Unhinged’ or ‘unleashed’? White House stabilizers gone, Trump calling his own shots (The Washington Post) The gatherings he attended last week neatly illustrated an inflection point for the Trump presidency. Fourteen months into the job, Trump is increasingly defiant and singularly directing his administration with the same rapid and brutal style he honed leading his real estate and branding empire.
Trump is making hasty decisions that jolt markets and shock leaders and experts – including those on his own staff. Some confidants said the president is becoming “unhinged,” while others, unworried, called him “unleashed.”
The president is replacing aides who have tended toward caution and consensus with figures far more likely to encourage his more rash instincts and execute upon them, and he is frequently soliciting advice from loyalists outside the government. As he shakes up his administration, Trump is prioritizing personal chemistry above all else, as evidenced by his controversial selection of Navy Rear Adm. Ronny L. Jackson, the White House physician, to lead the Department of Veterans Affairs.
- Comey’s book tour is a colossal mistake (The Hill) Announcements of scheduled appearances for the widely anticipated $850-to-attend book tour by fired FBI Director James Comey foreshadow a much-ballyhooed return to the public square. Media outlets eagerly booked the former director, and his opus, “A Higher Loyalty: Truth, Lies, and Leadership,” briefly jumped to No. 1 on Amazon’s best-seller list.
But should Comey – a central witness in special counsel Robert Mueller probe – be making public his version of events which will certainly differ significantly with what President Trump, the central target in the special prosecutor’s probe, has repeatedly stated?
- Trump criticizes Jerry Brown for issuing pardons (Los Angeles Times) President Trump blasted California Gov. Jerry Brown for using his pardon powers, in a series of pre-Easter Twitter attacks. Trump disparaged Brown with his old “Moonbeam” nickname and then criticized him for issuing Good Friday pardons, part of a tradition for Brown around the Easter season.
- A Swing-State Theorem, with Evidence (NBER) Abstract:
We study the effects of local partisanship in a model of electoral competition. Voters care about policy, but they also care about the identity of the party in power. These party preferences vary from person to person, but they are also correlated within each state. As a result, most states are biased toward one party or the other (in popular parlance, most states are either ‘red’ or ‘blue’). We show that, under a large portion of the parameter space, electoral competition leads to maximization of welfare with an extra weight on citizens of the ‘swing state:’ the one that is not biased toward either party. The theory applies to all areas of policy, but since import tariffs are well-measured they allow a clean test. We show empirically that the US tariff structure is systematically biased toward industries located in swing states, after controlling for other factors. Our best estimate is that the US political process treats a voter living in a non-swing state as being worth 77% as much as a voter in a swing state. This represents a policy bias orders of magnitude greater than the bias found in studies of protection for sale.
- Notre Dame Women Win National Championship (Twitter) Title is the second. The last was won on Easter Sunday 2001. See also Notre Dame beats Mississippi State on last-second shot (MSN).
Germany​
Syria
- Don’t Expect Trump’s New Hawks to Save the War in Syria (Bloomberg) The conventional wisdom in Washington these days says that Secretary of Defense James Mattis is the one man who can save the nation from war. The new secretary of state, Mike Pompeo, is a hawk’s hawk. And don’t get the foreign policy establishment started on incoming National Security Adviser, John Bolton. President Donald Trump himself pines for military parades and asserts that torturing terrorists “works.”
Like most conventional wisdom in the Trump era, however, this is all wrong — for a number of reasons. But the first and most important one is Syria. Trump actually wants to cut and run from this tragic country. This is why there is no real strategy for the moment to counter the Russian-Iranian led campaign to unify the country for the dictator in Damascus, Bashar al-Assad. U.S. forces are in Syria only to destroy the Islamic State.
India
- India’s Long Growth Path (Twitter)
Japan
- Japan PM to visit U.S. from April 17 to 20 for talks with Trump (Reuters) Japanese Prime Minister Shinzo Abe plans to visit the United States April 17-20 for talks with President Donald Trump, he said on Monday. Abe said he would ask Trump to bring up the issue of past North Korean abductions of Japanese citizens, during the U.S. president’s expected summit with North Korean leader Kim Jong Un.
China
- China Urges More Trade Talks as Tariffs on U.S. Goods Begin (Bloomberg) China urged trade talks with the U.S. to prevent greater damage to relations while saying that previously announced retaliatory measures on American imports took effect Monday. The U.S. didn’t respond to China’s March 26 request for consultation on Washington’s steel and aluminum tariffs, the Commerce Ministry said in a statement Monday, adding that officials have widespread public support for tougher measures and repeating Beijing’s stance that disputes should be resolved with dialogue. See also China announces it’s imposing new tariffs on 128 US products (CNBC).
- A closely watched indicator of China’s economy falls short of expectations (CNBC)
- Caixin, IHS Markit released China March manufacturing PMI that hit a four-month low of 51.0 in March.
- That metric focuses on smaller businesses in China compared to the official PMI reading, which was released on Saturday. (See next article.)
- China March factory growth stronger than expected: official PMI (Reuters) Growth in China’s manufacturing sector picked up more than expected in March as authorities lifted winter pollution restrictions and steel mills cranked up production as construction activity swings back into high gear. The official PMI reports data from China’s largest (and mostly government owned) businesses.
- China Space Lab Mostly Burns Up on Re-entry in South Pacific (Bloomberg) China’s defunct Tiangong 1 space station mostly burned up on re-entry Monday into the atmosphere over the central South Pacific, Chinese space authorities said.
The experimental space laboratory re-entered around 8:15 a.m. Beijing time, the China Manned Space Engineering Office said.
Scientists monitoring the craft’s disintegrating orbit had forecast the craft would mostly burn up and would pose only the slightest of risks to people. Analysis from the Beijing Aerospace Control Center showed it had mostly burned up.
Costa Rica
- Costa Rica center-left easily wins presidency in vote fought on gay rights (Reuters) The center-left’s Carlos Alvarado Quesada decisively defeated a conservative Protestant singer in Costa Rica’s presidential runoff election on Sunday by promising to allow gay marriage, protecting the country’s reputation for tolerance.
Mexico
- Trump Warns He’ll Dump Nafta If Mexico Doesn’t Stop Drug Flows (Bloomberg) President Donald Trump threatened to pull out of the North American Free Trade Agreement if Mexico doesn’t stop people and drugs from flowing into the U.S. from Central America. Econintersect: This is ridiculous on two counts: (1) It is a “cut off your nose to spite your face” move; and (2) Mexico could just as logically demand that the U.S. stop the demand for drugs that are funding the Mexican cartels.
- Exclusive: Mexican leftist has 18-point lead as campaign kicks off: poll (Reuters) Mexican left-wing presidential candidate Andres Manuel Lopez Obrador has an 18-point lead ahead of the July 1 election, according to a poll published on Monday that showed him with a growing advantage at the start of formal campaigning.
