Wall Street Journal (August 20)
“Mr. Modi’s plans to unleash market forces will lift millions of Indians out of poverty, but he also has ideas about how government can better meet the immediate needs of the poor.” Though some of his plans “may sound oddly simple to developed-world ears” (e.g. access to toilets and bank accounts), “the Prime Minister’s humble background gives him an understanding of what the poor need to find their own path to prosperity and the credibility to build a new consensus for those policies.”
Tags: Background, Bank accounts, Consensus, Credibility, Government, Humble, India, Modi, Policies, Poverty, Prosperity, Toilets
Bloomberg (August 19)
The annual meeting of central bankers kicks off this week in Jackson Hole and it’s worth paying attention. “Central bankers, a group of largely independent technocrats, wield more power over the fates of politicians, investors and regular folk than ever before. In the absence of government action, they are bearing most of the burden of supporting economic recoveries in the U.S. and Europe. With their bond purchases and other unconventional policies, they have become a major force holding up financial markets around the world.”
Tags: Bond purchases, Central bankers, Economic recoveries, Europe, Financial markets, Government, Investors, Jackson Hole, Politicians, Power, U.S.
Financial Times (August 18)
With the momentum of the Solidarity movement, Poland broke free of the Soviet Union on August 24, 1989. “Twenty-five years on, a generation of Poles has grown up with no personal experience of communism. Poland is a sovereign democracy, an increasingly prosperous market economy and a proud member of Nato and the EU— a nation transformed from the dreadful era of one-party rule, dismal living standards and subservience to Moscow. Poland, you could say, has never had it so good.”
Tags: Communism, Democracy, EU, Market economy, Momentum, Moscow, Nato, Poland, Solidarity, Soviet Union
New York Times (August 17)
China is both the world’s largest consumer of coal and the world’s largest producer of CO2 emissions. Encouragingly, that may be set to change. “The wretched air in China’s cities is forcing Chinese officials to change their energy policies. If they do a good job tackling local pollution, they could also have a big impact on climate change.” Details are still scarce, but could include a ban on the use of coal in urban areas by 2020.
Tags: Ban, China, Cities, Climate change, CO2 emissions, Coal, Consumer, Energy policies, Officials, Pollution, Producer, Urban areas
The Economist (August 16)
It looks increasingly like Scotland will vote against independence from the UK in the September 18 referendum. “The ‘no’ to independence campaign has a comfortable poll lead,” but this may not be the end of the story. Quebec engaged in what’s become known as a “neverendum” involving “decades-long deliberations over breaking from Canada.” So even if the Scots vote no, there “looms the prospect of a ‘neverendum.’ If unsuccessful, ‘yes’ campaigners could import that decades-long limbo to Britain.”
Tags: Britain, Campaigners, Canada, Independence, Limbo, Neverendum, Quebec, Referendum, Scotland, UK, Vote
Bloomberg (August 14)
“Antarctica glaciers melting because of global warming may push up sea levels faster than previously believed, potentially threatening megacities.” Researchers in Germany now believe that sea levels could rise by as much as 37 centimeters due to melting in Antarctica, greatly exceeding previous estimates.
Washington Post (August 13)
“U.S. businesses are aging…and a sharp decline in start-up companies is a big reason. As the share of young firms shrinks, the surviving companies are naturally older — and this may have huge ramifications for the economy.” Nobody’s sure why this trend is occurring, but it suggests slower job creation and raises a troubling question. “Could it be that a society whose members are getting older is more risk-averse and less adventurous?”
Tags: Adventurous, Aging, Businesses, Decline, Economy, Job creation, Ramifications, Risk-averse, Society, Start-ups, U.S.
Wall Street Journal (August 13)
Some Internet connections have been disrupted this week and more bumps are expected. “The situation echoes—if faintly—the hubbub over the feared Y2K computer glitch in the late 1990s, when experts warned that systems could fail because their dating functions hadn’t been designed to handle the turn of the century.” The total number of Internet paths through the global web has grown to approximately 500,000, exceeding the number some old network routers can accommodate. “More websites and broadband firms are likely to feel the pinch in coming days as they hit the seemingly arbitrary limit,” necessitating the upgrade or replacement of older routers.
Tags: Broadband, Connections, Disrupt, Internet, Paths, Replacement, Routers, Upgrade, Websites, Y2K
Institutional Investor (August 12)
“Disappointing sentiment data and continued conflict in eastern Ukraine” are leading to investor apprehension. “Slowing production levels and low inflation appear to leave the door open for European Central Bank intervention but political support for action from European Union leaders is still far from consensus. With a strong correlation between primary global equity indexes that has been noted by multiple strategists in recent sessions, deteriorating investor confidence in Europe is likely to cast a shadow over U.S. equity markets in the near term.”
Tags: Confidence, Conflict, Consensus, Disappointing, ECB, Equities, EU, Inflation, Intervention, Investors, Production, Sentiment, U.S., Ukraine
8/13 Issue
While Abenomics has been succeeding in many areas, The Economist reports that “despite a tight labour market, real wages continue to tumble. In May they fell by 3.8% compared with a year earlier—the steepest decline in years.” More ambitious measures to help lift wages would cost significant political capital, but Abe needs to make a bold move on wages. “Abenomics, and Japan’s recovery, rests on it.”
Bloomberg meanwhile says “Japan needs more gusty moves overseas,” asserting that “such investments will do more to create economy vitality than all the liquidity Kuroda & Co. can churn out.” The BoJ recently decided to forego additional monetary stimulus despite slowing inflation, signaling Kuroda may realize the limitations of his reach and highlighting the need for new solutions.
Overseas investment may be an easy option for Japan, but it’s proving difficult for Taiwan. The Wall Street Journal notes that if China and South Korea conclude a free trade agreement later this year as expected, “roughly 2% to 5% of all of Taiwan’s exports to China could be replaced by South Korean products.” Taiwan could pursue similar deals, but becoming too financially intertwined with China could undermine Taiwanese independence.
Turning to Europe, the Portuguese government announced a rescue plan that would split Banco Espírito Santo in two after the bank reported a €3.58 billion loss. The New York Times reported “the bank’s branches, customer deposits and healthy assets are being spun off into a new entity called Novo Banco.”
As the Ukraine-Russia conflict continues, Europe could see its energy bill rise. There are not enough alternative energy sources to wean Europe off of Russian oil and gas. As Euromoney puts it, unless European governments do more to accelerate a shift to other sources of energy, consumers there “will face higher energy prices than the US over the next decade or more.”
The Ukraine-Russia conflict is not only affecting energy prices, however. Institutional Investor reports that “disappointing sentiment data and continued conflict in eastern Ukraine” are “deteriorating investor confidence in Europe.” They also noted that this is “likely to cast a shadow over U.S. equity markets in the near term.”
Turning to the U.S., President Obama attended the U.S.-Africa Leaders Summit in Washington D.C. and unveiled two new initiatives to help stabilize turbulent regions of Africa. The Washington Post says the new initiatives “will try to avoid past U.S. mistakes. They recognize that the U.S. military should be training partners and allies, rather than doing the fighting.”
The New York Times this week took an in-depth look at 3-D printing. Although the paper stated “it’s still unclear exactly how and when 3-D printing will have an impact on our daily lives,” several of the essays published on the topic gave a good outline of the new technology and potential applications.
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To see the overseas media’s takes on these and other developments, you can browse the Global News highlights in app or at http://www.irken.jp/gn/. Links to the original sources are provided above, but please note these are frequently updated. Links that were valid at publication may later be broken.
