News: 2014-03-13
Today’s newsletter post is delayed until after the email distribution. I will be posting it at some point later. A lot of news links are hear, however.
Britain
Scotland’s deficit of £12bn damages Alex Salmond’s case for independence | Politics | The Guardian
George Soros: Scotland sharing the pound after independence is ‘impossible’ – Telegraph
North America
‘Fiscal Policy Re-Assessed’ | Econbrowser
Wages of Fear (Somewhat Wonkish) – NYTimes.com
Evan Soltas – Trading in Your Feathers
“I think the expected path for monetary policy is already dovish, and wisely so. It was an awful recession. But there really is such a thing as “too much.” This is already quite a lot. And to say that the current policy path is broadly appropriate, as I’ve done, really does imply that it’s time to start talking about how tight the labor market is, about how much slack the U.S. economy has left, and about tightening. The reason the Fed is tapering now and talking ever more frankly about rate hikes is ultimately because yes, it’s about time.”
Wells Fargo made up on-demand foreclosure papers plan: court filing charges | New York Post
“Wells Fargo, the nation’s biggest mortgage servicer, appears to have set up detailed internal procedures to fabricate foreclosure papers on demand, according to allegations in papers filed Tuesday in a New York federal court.”
Wall Street cash bonuses highest since 2008 crash: report | Reuters
Compensation Climbing Thanks to Surging Benefits Costs – Real Time Economics – WSJ
“Private employers are boosting their workers’ compensation at the fastest quarterly pace since before the recession. But the gain was driven disproportionately by benefits, a new Labor Department report showed Wednesday.”
“Ford becomes the 144th death row inmate to be exonerated over the past four decades, underlining the perils of innocent people being sent to their deaths in America’s capital punishment system. Yet despite such warning, several states such as Alabama, California, Florida and Missouri have taken recent steps to speed up the process of executions and whittle down the recourse to appeals in a way that had such expedition applied in Ford’s case would already have seen him put to death.”
What Stanley Fischer Did at the IMF – Bloomberg View
“Unfortunately for Russia, this set of priorities helped make it possible for oligarchs to strip the state of assets as the economy collapsed. A thorough review of Fischer’s time at the IMF probably will make him look better than he already does in most people’s eyes. Still, it would be imprudent to vote to confirm him without knowing all of the relevant facts.”
Mexico Raises $1.66 Billion With First 100-Year Bond in Pounds – Bloomberg
Europe
ekathimerini.com | Soros says Europe faces 25 years of stagnation without overhaul
BBC News – George Soros says EU may not survive crisis ‘tragedy’
“”Japan has just had 25 years of it and is desperately trying to get out of exactly the situation that Europe is moving into. But the European Union is not a nation. It is just an association of sovereign states, a very incomplete association, and it may not survive. This euro crisis has converted what was meant to be a voluntary association of equal sovereign states that sacrificed part of their sovereignty for a common benefit into a relationship between debtors and creditors. The debtors can’t pay their debts and are dependent on their creditors’ mercy, and that creates a two-class system. It’s not voluntary and it’s not equal.””
German Finance Minister Says Euro-Zone Rates Are Too Low – WSJ.com
“”I think we have an interest-rate level that’s too low in the medium term from a German point of view,” said Mr. Schäuble during a news briefing on the government’s new budget plans. “I know that the situation is very different in some other European countries—that is why a common monetary policy isn’t quite so easy in Europe.” Mr. Schäuble said he hopes that a boost in countries’ competitiveness will help bring about an interest-rate level that is fairer for all.”
Paralysed ECB leaves Europe at the mercy of deflation shock from China – Telegraph
Ambrose presents the monetarist view of ECB policy
This Swiss article makes some good points about Germany’s budget plans. It wants to have a balanced budget for the first time since 1969. One problem is that this is done on the back of a currency union that is weak relative to where the DM would be. That has led to record current account surpluses. The second problem is that Germany has a dearth of capital investment at home. Public infrastructure investment is also needed, as German infrastructure measured according to economic potential has sunk 10% since 1991. Good read.
Italy presents sweeping tax cuts, plans to raise deficit goal | Reuters
ECB review forces Italian banks to face up to reality | Reuters
Fitch Affirms European Union & Euratom at ‘AAA’; Outlook Stable | Reuters
Ukraine
Kiev threatened with loss of Crimea-based oil giant | beyondbrics
Kiev snipers: Who was behind them? – CSMonitor.com
Exclusive: McCain to Lead Delegation to Ukraine – The Daily Beast
5 very serious answers to 5 very serious questions from BuzzFeed — RT Op-Edge
Emerging Markets
Burbuja inmobiliaria en Brasil: un apartamento de 30 metros en una favela de Río por 850 dólares
House prices in Brazil have increased by as much as 250% in the last six years. The talk is of a housing bubble. This article focuses on favelas where prices are even escalating.
Mehrere Tote bei Protesten in Venezuela « DiePresse.com
Multiple deaths at the protests in Venezuela that continue. AT least 27 people have died since 12 February
La inflación llegó a 4,3% en febrero, según el IPC Congreso – 13.03.2014 – lanacion.com
Worst February inflation in 23 years in Argentina
China
China slowdown clouds sub-Saharan Africa outlook | beyondbrics
The scary factors behind copper’s price plunge
“”China’s weak industrial activity data is one. Second, the appeal of commodity trade-related financing deals in China appears to be waning.” The latter factor is particularly intriguing. Chinese lenders, especially in the nonbank or “shadow” sector, often allow copper to be pledged as collateral. With expectations that the government is going to allow more bond defaults—the first happened last week—lenders are beginning to worry that copper’s value will decline.”
Japan
Japan Unions Get $19-a-Month Raises Amid Abe Wage Push – Bloomberg
For Some Japanese Workers, Pay Rises Are Generous – Japan Real Time – WSJ
Technology
Apple drops its 30 day return policy on iPhones down to 14 days | 9to5Mac
Credit Karma Confirms New $85M Financing Round Led By Google Capital | TechCrunch
Overstock’s Bitcoin Purchases Account For Less Than 1% Of Revenue, But It’s Growing | TechCrunch
Goldman Sachs: Bitcoin Is Not A Currency | TechCrunch
““We would argue that Bitcoin, and other digital currencies, lie somewhere on the boundary between currency, commodity and financial asset,” write Dominic Wilson, chief markets economist at Goldman Sachs, and Jose Ursua, a global economist with the firm. “Our best definition would be that it is currently a speculative financial asset that can be used as a medium of exchange.” A successful cyber-currency needs a fixed exchange rate to succeed, according to the economists, and the difficulties Bitcoin faces as a store of value are significant obstacle to its adoption.”
Adblock Plus Now Blocks 8,600 Tracking Filters As Ad Tech Explodes | TechCrunch
Critical crypto flaw in Facebook’s WhatsApp for Android exposes chats | Ars Technica
Germany: Poledancing robots sleaze up CeBIT – YouTube
These robots are going to put people out of jobs! Technology.
Espionage
CIA Hack Scandal Turns Senate’s Defender of Spying Into a Critic | Threat Level | Wired.com
Dana Milbank: Allegations of CIA spying on the Senate deserve investigation – The Washington Post
How the NSA Plans to Infect ‘Millions’ of Computers with Malware – The Intercept
“Top-secret documents reveal that the National Security Agency is dramatically expanding its ability to covertly hack into computers on a mass scale by using automated systems that reduce the level of human oversight in the process.”
Markets
Höchster Stand seit Ende 2011: Euro springt in die Höhe – n-tv.de
The euro is trading at the highest levels since October 2011.
US opens emergency oil stockpile in signal to Putin – Telegraph
US to release oil from strategic reserve – FT.com
The FTC has opened an investigation into Herbalife [Update] | FT Alphaville
Puerto Rico’s $3.5 Billion Muni Deal Jumps in Heavy Trading – WSJ.com
Copper hit as China banks cut import financing – FT.com
“Tighter credit has this week helped push Chinese copper prices to their lowest level since 2009 and dragged iron ore prices close to $100 a tonne. “
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