Written by Econintersect
Early Bird Headlines 31 January 2019
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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- Asian stocks mixed as manufacturing activity in China shrinks again (CNBC) Major stocks in Asia closed mixed on Thursday on the back of official data from China showing that the Chinese manufacturing economy contracted for the second month in a row in January. The U.S. dollar index was lower at 95.272 after seeing an earlier session high of 95.379. The international benchmark Brent crude futures contract gained 0.75% to $62.11 per barrel. The U.S. crude futures contract rose 0.57% to $54.54 per barrel. Spot gold was steady at $1,319.72 per ounce by 0308 GMT.
- The data casualties of the federal government shutdown (Pew Research Center) The ongoing shutdown of large parts of the federal government – now at 18 days and counting – has left hundreds of thousands of federal workers either furloughed or working without pay indefinitely, reduced staffing at national parks to skeleton levels, and closed down popular museums. It’s also squeezed the daily flood of data from federal agencies down to a trickle, affecting everyone from investors and farmers to researchers and journalists.
- The Census Bureau has ceased most operations, other than planning for the 2020 count. That means, among other things, no November data on new home sales (which were supposed to come out Dec. 27), construction spending (Jan. 3), manufacturers’ shipments, inventories and orders (Jan. 7) and international trade (Jan. 8). Unlike previous shutdowns, however, the Census website is running, giving people access to previously published data. The Federal News Network reports that the bureau has six to eight weeks of “carryover funding” it can use for planning purposes, but should the shutdown last longer than that even that work would cease. Activities funded otherwise than by annual appropriations, such as those paid for by other agencies or “non-Federal entities,” may also be continuing.
- Like Census, the Bureau of Economic Analysis is part of the Commerce Department, and also has ceased operations for the duration. That could affect the bureau’s first estimates of fourth-quarter and full-year 2018 gross domestic product, which are supposed to be released on Jan. 30.
- The Bureau of Labor Statistics is fully operational, as it is part of the Labor Department (which was funded back in September). That means the inflation report for December, scheduled to be released Jan. 11, is on track, a spokesman told us. That also goes for the releases of detailed jobs and unemployment data for December (the national-level data came out Jan. 4, and data for states and metro areas typically follow a few weeks later). But plans for the January jobs report, data for which are supposed to be gathered next week, are still uncertain: The BLS conducts the payroll survey of employers itself, but the Current Population Survey (which generates the data used to calculate the unemployment rate) is a joint effort with the Census Bureau.
- The Agriculture Department’s main statistical offices, the National Agricultural Statistics Service and the Economic Research Service, are both closed. That means farmers will not have current data on global supply and demand for farm products, crop and livestock production estimates, and other agricultural economics matters. However, the Agricultural Marketing Service is continuing to provide market-price data for meat, grain, dairy products and other commodities.
- Although most employees of the Justice Department have been deemed essential and are still working (without pay), the office that includes the Bureau of Justice Statistics is an exception. That means data on crime, sentencing, prisons and other law enforcement topics aren’t being updated. (The bureau did, however issue a report on Jan. 8 about identity theft based on 2016 data.)
- The Bureau of Transportation Statistics, part of the Department of Transportation, had been operating normally except for the Office of Airline Information. However, a notice posted Tuesday said that, except for the Transportation Services Index for November (scheduled for release Jan. 9), all other statistical releases would be delayed due to the shutdown.
- GOP rejects bill to give back pay to federal contractors, wants to repeal estate tax instead (Salon) Not a single Republican senator has joined the effort to give back pay to hundreds of thousands of federal contractors who were unpaid during the partial government shutdown. But the party’s leaders are pushing ahead with a bill to repeal the federal estate tax on behalf of the wealthiest Americans. Minnesota Sen. Tina Smith and Massachusetts Rep. Ayanna Pressley, both Democrats, have introduced bills that would give back pay to federal contractors, who are not entitled under law to be paid after a shutdown as federal employees are, Vox reported.
- Sen. Elizabeth Warren on Wealth Tax Plan, Health Care and Venezuela (Bloomberg) Elizabeth Warren (D, MA) discussed her proposed wealth tax plan, U.S. health-care policy, and the political crisis in Venezuela with Bloomberg‘s Joe Weisenthal on “Bloomberg Markets: What’d You Miss?“
- 72 percent in poll think Trump, Congress will fail to reach border deal (The Hill) Just 28% of those surveyed in a new poll think President Trump and Congress will reach a deal on border security in the next three weeks, underscoring the deep skepticism voters hold toward Washington after the longest government shutdown in U.S. history. Seventy-two percent of registered voters polled think no deal will be reached, according to the latest Hill-HarrisX poll. Lawmakers aiming to reach a deal met for the first time on Wednesday – and just hours after Trump tweeted his own apparent skepticism of their efforts.
- Roger Stone’s Arrest Was Appropriate, Not Heavy-Handed (LawFare) This is the opinion of Chuck Rosenberg, a former U.S. attorney, senior FBI official and chief of the Drug Enforcement Administration. He writes:
Law enforcement simply does not hand a summons to someone who threatens to kill a witness and trust that person to act responsibly with it. No conscientious prosecutor would think a summons appropriate there, or think that a threat to kill a witness is simply what targets of grand jury investigations routinely do.
- Americans Selling Homes in 2018 Had Biggest Gains in 12 Years (Bloomberg) Home sellers in 2018 had an average realized gain of $61,000, up from $50,000 in 2017 and $39,500 in 2016. Homeowners who sold in the last quarter had stayed in their properties an average of 8.3 years, longer than they have in at least 19 years and the longest since Attom Data Solutions started tracking the statistic in 2000.
- Brux column: The economics of discrimination and racism (River Falls Journal) A retired economics professor explains the negative economic affects of racism (lowers GDP) as well as the social impacts (higher unemployment, poverty, infant mortality rates, and lower life expectancies). Of course the two economic and social affects are interrelated.
- Border apprehensions increased in 2018 – especially for migrant families (Pew Research) There were nearly 416,000 apprehensions at the U.S.-Mexico border in the first 11 months of 2018, the most in any January-November period since 2014, according to a Pew Research Center analysis of the most recent available data from U.S. Customs and Border Protection. The increase was driven in part by a dramatic spike in border apprehensions of family members in the fall of last year.
Despite the increase, the number of border apprehensions through the first 11 months of 2018 remained far below the levels throughout most of the 1980s, 1990s and 2000s, when around 1 million or more migrants were being apprehended each fiscal year.
- FACT CHECK: Trump, Illegal Immigration And Crime (NPR) See also Criminal Immigrants in Texas: Illegal Immigrant Conviction and Arrest Rates for Homicide, Sex Crimes, Larceny, and Other Crimes (Cato Institute). After days of damaging news stories about an administration policy that separated immigrant families at the Southern border, President Trump tried to change the narrative Friday. He spoke up for grieving family members who have lost loved ones at the hands of people in the country illegally.
Trump has frequently pointed to sympathetic crime victims to justify his get-tough policies at the Southern border. But experts say the president’s rhetoric overstates the threat posed by immigrants, who tend to commit crime at lower rates than people who are born in the United States.
- German Bund Yields are Falling (Twitter)
- U.S. Warns Israel Against Strikes on Syria (The Diplomatic Observer) Speaking at a hearing of the U.S. Senate Select Committee on Intelligence in Washington on Tuesday, Director of National Intelligence Dan Coats said that Israel’s continued aerial assaults against Syria would increase the risk of Iran’s retaliation. Coats said:
“We assess that Iran seeks to avoid a major armed conflict with Israel. However, Israeli strikes that result in Iranian casualties increase the likelihood of Iranian conventional retaliation against Israel.”
- Russia, U.S. last-ditch talks to break nuclear pact deadlock fail: agencies (Reuters) Russia and the United States failed to bridge their differences over a landmark Cold War-era arms treaty at last-ditch talks in Beijing, Russia’s deputy foreign minister was quoted as saying by Russian news agencies on Thursday.
- China said on Thursday its manufacturing activity contracted for the second-straight month in January.
- Official manufacturing Purchasing Managers’ Index (PMI) for January was 49.5, according to the National Bureau of Statistics of China.
- That’s higher than the 49.4 reported in previous month, and the 49.3 expected by analysts in a Reuters poll.
- China’s military-run space station in Argentina is a ‘black box’ (Reuters) When China built a military-run space station in Argentina’s Patagonian region it promised to include a visitors’ center to explain the purpose of its powerful 16-story antenna. That has not happened.
- The U.S. Government Is Warning Americans That If They Visit China They May Not Be Able to Return Home (Travel & Leisure) The US State Department has issued a travel advisory urging Americans to “exercise increased caution” when traveling to the People’s Republic of China. The State Department’s elevated travel advisory is out of concern that China may arbitrarily enforce local laws and detain US citizens without cause.
The advisory also indicates that US-Chinese citizens or Americans of Chinese heritage are especially vulnerable to “additional scrutiny and harassment.”
- Alongside several other countries, the U.S. immediately recognized Guaido as the Latin American country’s rightful interim leader, ramping up the pressure on President Nicolas Maduro.
- It has thrust the oil-rich, but cash-poor, country into uncharted territory – with political tensions approaching boiling point ahead of two nationwide anti-government protests this week.
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