Financial Markets and Economy
Here's a simple explanation of why Chinese stock markets are in free fall right now (Business Insider)
Chinese stock markets are in complete collapse right now, with the main Shanghai Composite index losing 30% of its value in just the last three weeks. The turmoil is now starting to spread to other Asian markets and global commodities markets.
The reason behind the crash is this: millions of ordinary Chinese citizens sunk borrowed cash into shares, which inflated prices to unsustainable levels.
Meanwhile, In "Success Story" Portugal (Zero Hedge)
Somehow, with over 33% of young people unemployed, Portugal is held up to be a 'success story' for Merkel's Europe's grand plan. With their stock market tumbling and bond yields (and spreads) soaring…
Chinese stocks are crashing (Business Insider)
Markets in Asia are open on Wednesday and stocks in China are in free fall.
The benchmark Shanghai Composite index fell 4.64% while the CSI 300, that which comprises the largest listed firms on the Shanghai and Shenzhen exchanges, has tanked 4.83%. Having hit multi-year peaks in early June, both have now fallen by over 31%.
There's No Hope For A Deal "Priced In" Greek Bank Bonds (Zero Hedge)
With equity markets jumping vertically on every possible 'hope' of a deal – no matter what the consequence – we look to the asset class that is a) not driven by headline-reading algos and HFT, and b) is by far the most sensitive to reality – Greek Bank Bonds… and they are carnaging!!
This isn't the first U.S. stock market 'glitch' (CNN)
The American stock market is no stranger to glitches.
A technical glitch halted trading at the iconic New York Stock Exchange on Wednesday for more than two hours. NYSE said the stoppage was being caused by internal problems, not a cyber attack.
U.S. stock futures fall more than 1 percent as China shares plunge (Business Insider)
U.S. stock futures extended falls in Asian trading on Wednesday, tumbling more than 1 percent as plunging Chinese shares rattled investors.
S&P 500 E-mini futures were last down 1 percent on the day at 2,053.75, after dropping as low as 2,052.25.
China's share markets extended a savage correction that has clipped 30 percent off Chinese shares since mid-June, despite market support steps from Beijing.
Presenting China's Plunge Protection Playbook (Zero Hedge)
Earlier today we were amused (but not at all surprised) to learn that Beijing's latest strategy in the fight to rescue collapsing Chinese stock prices involves forbidding local media from using terms like "rescue the market" and "equity disaster". Here's a concise recap of the situation.
The Crash in China Continues – and is Engulfing Hong Kong (Acting-Man)
When we first commented on the emerging problems with China’s market bubble, we warned that although a bounce from oversold levels was the most likely outcome, it wasn’t set in stone. It appeared to us that Chinese investors were especially prone to falling for the “potent directors fallacy” (a term coined by Robert Prechter of EWI many years ago) – the belief that powerful decision makers, in this case the central bank and the government – would be willing and able support the market no matter what. Willing they have been – able, less so.
Market’s Dive Could Delay Economic Reforms in China (NY Times)
China’s stock market tumblehas presented the government of President Xi Jinping with a searing test of its commitment to overhaul the country’s financial system and open up the state-controlled economy.
Building off the work of his predecessors in the last three decades, Mr. Xi has been introducing competition into the banking industry, overhauling state-owned companies and making it easier for foreign investors to buy Chinese stocks. But the pace of reform may slow if the stock market slump persists, or even accelerates.
Greece and China expose limits of 'whatever it takes' (Business Insider)
For a world so confident that central banks can solve almost all economic ills, the dramas unfolding in Greece and China are sobering.
"Whatever it takes," Mario Draghi's 2012 assertion about what the ECB would do to save the euro, best captures the all-powerful, self-aware central bank activism that's cosseted world markets since the banking and credit collapse hit eight years ago.
Greece Faces Euro Exit Unless Demands Accepted by Sunday (Bloomberg)
European leaders talked openly about a Greek exit from the euro ahead of a weekend summit on the country’s economic future, breaking dramatically with years of denial about the possibility.
Europe has “a Grexit scenario prepared in detail,” European Commission President Jean-Claude Juncker said late Tuesday night, hours before Austrian Chancellor Werner Faymann said Greece’s Plan B is “another currency.” The European Union set a Sunday deadline to reach a deal with Greece on a financial rescue in exchange for austerity measures and economic reforms.
What Greece, Cyprus, and Puerto Rico Have in Common (Our Infinite World)
We all know one thing that Greece, Cyprus, and Puerto Rico have in common–severe financial problems. There is something else that they have in common–a high proportion of their energy use is from oil. Figure 1 shows the ratio of oil use to energy use for selected European countries in 2006.
Alcoa whiffs on earnings (AA) (Business Insider)
Alcoa reported second quarter earnings after the close on Wednesday, beating expectations on revenues but missing on earnings.
The aluminum giant posted adjusted earnings per share of $0.19, missing the consensus estimate for $0.22 according to Bloomberg.
Sales came in at $5.9 billion, versus the forecast for $5.81.
Financial Nonsense Overload (Club Orlov)
“Those whom the gods wish to destroy they first make mad” goes a quote wrongly attributed to Euripides. It seems to describe the current state of affairs with regard to the unfolding Greek imbroglio. It is a Greek tragedy all right: we have the various Eurocrats—elected, unelected, and soon-to-be-unelected—stumbling about the stage spewing forth fanciful nonsense, and we have the choir of the Greek electorate loudly announcing to the world what fanciful nonsense this is by means of a referendum.
As most of you probably know, Greece is saddled with more debt than it can possibly hope to ever repay…
Over half of China's stocks have stopped trading (CNN)
About 1,400 Chinese companies have elected to pull their shares after markets started on a crazy roller-coaster ride.
China stocks nosedive despite fresh regulator support (Business Insider)
Chinese stock markets tumbled again on Wednesday as investors shrugged off a series of support measures by Chinese regulators, including the central bank's first public statement in support of the market since it cut interest rates in late June.
The CSI300 index slumped more than 7 percent at the open and was down 4.8 percent at 3,739.18 points by 0208 GMT.
U.S. stocks set for day in the red ahead of FOMC minutes, Alcoa earnings (Market Watch)
U.S. stock futures pointed sharply lower on Wednesday, as investors grappled with a major selloff in Chinese shares, jitters over Greece and the upcoming Federal Reserve minutes.
The unofficial start to the earnings season, which comes with Alcoa’s report after the market close on Wednesday, was also weighing on investors’ minds.
Oil prices rise as deadlines for Greece, Iran are pushed back (Market Watch)
Oil prices nudged slightly higher Wednesday as deadlines on Greece and Iran were extended, the dollar weakened and attention moved to U.S. inventories data due out later in the day.
Brent crude for August delivery traded on London’s ICE Futures exchangeLCOQ5, +0.58% rose $0.32 to $57.17 a barrel. On the New York Mercantile Exchange, light, sweet crude futures for delivery in August CLQ5, +0.10% traded at $52.46 a barrel, up $0.12.
Greece asks for a third bailout (CNN)
The Greek government has formally requested a third bailout to help pay its debts and bring its economy back from the brink.
The European Stability Mechanism, which acts as Europe's financial rescue fund, confirmed Wednesday that Greece applied for a new bailout package.
Oil edges up on expected U.S. stock draw; Greece, China worries drag (Business Insider)
Oil futures steadied early on Wednesday on an expected drop in U.S. inventory, but worries over the Greek debt crisis and China's stock market turmoil dragged on prices.
A Reuters poll flagged a 700,000-barrel decline in U.S. oil inventory, while industry group American Petroleum Institute (API) estimated a drop of nearly 960,000 barrels. Government data will be published on Wednesday.
71% of the world's people live on less than $10 a day (CNN)
Here's the good news: Global poverty has fallen by half over the past decade.
Humana, Aetna set termination fees for deal (Business Insider)
Health insurer Humana Inc and buyer Aetna Inc set fees to be paid in the event of a failure of the largest deal in the health insurance industry.
Aetna, which said last week it would buy Humana for about $37 billion in cash and stock, has to pay a termination fee of $1.69 billion, Humana said in a regulatory filing on Tuesday.
Humana would pay the larger rival $1.31 billion if the deal is terminated.
Chinese bonds feel pinch from Shanghai’s stock selloff (Market Watch)
Signs that contagion from China’s plunging stocks is spreading to the country’s bond market emerged Wednesday as investors sought ways to raise much-needed cash.
While Shanghai’s equity market SHCOMP, -5.90% fell another 5.9% Wednesday, the yield on China’s benchmark one-year government bond rose 0.3 percentage point to 2.32% as brokerages and mutual funds unloaded some of their debt holdings amid concerns over a looming cash crunch. Bond prices move inversely to yields.
GUNDLACH: This looks like a sign of an American consumer borrowing frenzy (Business Insider)
In a webcast for investors on Tuesday, DoubleLine Funds' Jeff Gundlach raised concerns about Americans borrowing lots of money against their homes.
Home equity lines of credit (HELOC) are revolving loans, like credit cards, that are backed by the value of a borrower's home. The credit line tends to be available to the borrower for a fixed amount of time, generally ten years. At the end of that period, the line can sometimes be renewed, or the borrower may need to pay back any outstanding balance.
U.S. Heavy Truck Sales in June: Highest since February 2007 (Calculated Risk)
This graph shows heavy truck sales since 1967 using data from the BEA. The dashed line is the June 2015 seasonally adjusted annual sales rate (SAAR).
Heavy truck sales really collapsed during the recession, falling to a low of 181 thousand in April 2009 on a seasonally adjusted annual rate basis (SAAR). Since then sales have more than doubled and hit 450 thousand SAAR in June 2015 – even with weakness in the oil sector.
Experts advice caution, say no need to buy in rush (Money Control)
Sudip Bandopadhyay, Destimoney Securities says it's more a falling knife situation and currently, there are too many moving parts in terms of Greece, China fall, Fed meet, Iran nuclear deal, IIP numbers, inflation etc., so it would be prudent to wait and watch and let things stabilise before buying.
Stocks: Where Did That Come From?!?! (Stocks to Watch)
Stocks were getting killed today–until they weren’t. Instead they finished higher on the day. Bloomberg News The S&P 500 gained 0.6% to 2,081.34, while the Dow Jones Industrial Average has rose 0.5% to 17,776.91. The Nasdaq Composite ticked up 0.1% to 4,997.46. ISI Group’s Krishna Guha chalks the rally up to the eurogroup’s statement regarding.
Politics
Kenyan Leaders To Obama: We’ll Throw Rotten Eggs At You If You Talk About LGBT Rights Here (Think Progress)
Some Kenyans are threatening to meet President Obama with scorn — and rotten eggs — during his visit to their country next month.
“I will mobilize and lead every member of the council, including women and the youth, and Kenyans in general to throw rotten eggs at Obama if he dares introduce the gay and lesbian debate,” a member of the head of a council of elders said on Monday.
How Rand Paul Could Ride the Maharishi Effect to Victory (Bloomberg)
At Earth & Water, a teahouse in downtown Fairfield, Iowa, patrons sit cross-legged on mats as they down cups of oolong or puerh. Shoes are optional, if not discouraged. On a typical afternoon, it’s crowded with students from the Maharishi University of Management, which opened in 1974 to teach a curriculum inspired by the Maharishi Mahesh Yogi, the progenitor of Transcendental Meditation.
Fairfield, the center of Transcendental Meditation in the U.S., is a hotbed of support for Kentucky Republican Senator Rand Paul.
‘Pathetic’ and ‘baby stuff’: Donald Trump mocks Jeb Bush on education, immigration (Market Watch)
Here are two terms Donald Trump used to describe Jeb Bush’s policies: “pathetic” and “baby stuff.”
Trump, who like Bush is seeking the Republican nomination for president, dropped the verbal bombs in an interview Tuesday on Fox News Channel’s “On the Record.” The Hill writes more about Trump and his use of “pathetic” for Bush’s support of Common Core education standards and “baby stuff” for the former Florida governor’s stance on immigration. Bush hasn’t been shy about criticizing Trump, either. On Saturday, Bush called Trump’s remarks about undocumented immigrants “extraordinarily ugly.”
Candidates Start Showing Their Cards (Bloomberg)
The 2016 presidential money race is starting to take shape and early indications are that the road ahead will be lined with bullion.
Among the candidates who have shared fundraising numbers, ahead of filing deadlines later this month at the Federal Election Commission, Hillary Clinton, not surprisingly, leads the Democratic field with her campaign and allied groups reporting a combined war chest of nearly $70 million. Even Bernie Sanders, who describes himself as an independent socialist, says he has already lined up $15 million, from primarily smaller donations, to wage his campaign.
Technology
Laser Breathalyzer Can Sniff Out Disease (Popular Science)
Dogs are pretty good at sniffing out cancer, but now researchers have developed an “optical dog’s nose” that uses lasers to detect a range of diseases by analyzing the molecules in ones breath.
When someone gets cancer or an infection, metabolic processes produce certain molecules in the body. These molecules can be picked up by sensors to tell whether the disease is present. “Electronic noses” have been around since the 1980s, and past technologies have used sensors that mimic our nasal receptors to detect infections in diabetic’s feet, or gold nanoparticle sensors that can detect different forms of cancer by picking up volatile organic compounds in a person’s breath.
This Lamp Runs On Salt Water (Co.Exist)
Got some water? Got some salt? Now you also have a light.
As you can imagine of a country that is spread over more than 7,000 islands, many people in the Philippines aren't hooked up to the power grid, so a common light source is the relatively dangerous kerosene lamp. In addition to the fire risk, getting the kerosene is a chore that takes a lot more work than flipping a switch. Or, now, scooping up a bucket of seawater. Just put a cup of ocean in the bottom of the SALt lamp and it lights up.
New Aftermarket System Makes Your Car Self-Driving (Popular Science)
Cruise RP-1 Sensor Pod Cruise Automation Self-driving and autonomous cars are being tested by tech companies like Google and auto manufacturers like Audi, and almost every new car on the market has some kind of driver-assist systems. Now Cruise Automation promises to bring that bleeding-edge tech to your very own car (as long as that car is an Audi A4 or S4 in California, so far) with its RP-1 “highway autopilot.”
Health and Life Sciences
Is Marijuana A Benefit Or A Bad Idea For Autism And Schizophrenia? (Forbes)
When Jim Carrey co-opted the image of a distressed boy with tuberous sclerosis complex (TSC) in an effort to reinforce the actor’s views about vaccines, heinadvertently brought attention to TSC, which is, unlike vaccines, associated with autism. In using the image of Alex Echols, for which he later apologized, Carrey may also have brought attention to another topic of discussion in autism circles: the use of marijuana as a therapeutic.
Alex’s parents have a blog where they’ve written about Alex and his needs for many years. Among those needs, they argue, is therapeutic marijuana, which they say helps Alex with his self-injurious behaviors. They have published their clear agenda for accomplishing this for their son, who currently lives in a group home.
Does childhood stress make women gain weight? (Futurity)
Stress in childhood may be a significant factor for women’s weight gain, a new study suggests. In fact, it may be even a bigger culprit that stress during adulthood.
Neither childhood nor adult stress has any impact on weight gain for men.
“These findings add to our understanding of how childhood stress is a more important driver of long-term weight gain than adult stress, and how such processes differ for men and women,” says Hui Liu, associate professor of sociology at Michigan State University.
Life on the Home Planet
The humans who hitch rides on sharks (Mashable)
Some people go to aquariums to see sharks. Some are brave enough to watch them in their natural habitat from behind the bars of a protective cage. Others go the extra mile and forego all protection to open-water dive with the ocean's top predator.
Sharks seem to be generally uninterested in humans and their cumbersome scuba gear. They would probably rather be searching for their next fishy meal than serving as a diver's de-facto water scooter. While riding sharks is not illegal, it can be dangerous to both the diver and shark and could also be disruptive to the shark's feeding habits and other natural activities. With that in mind, check out these photos of humans getting extra close to some annoyed-looking sharks.
Saving plants from a 'mass extinction' (BBC)
An ambitious project launched Wednesday to collect the genomes of the planet's major plant groups within the next two years and put them into deep freeze.
The project is part of the Global Genome Initiative, which aims to gather and preserve the DNA of all life on Earth in cryo-storage facilities.
Why More Women Are Turning to Heroin (The Atlantic)
Throughout the history of modern medicine, substance abuse researchers have focused their investigations almost exclusively on men. It wasn't until the 1990s that scientists, prompted by federal funding aimed at enrolling more women in studies, began widely exploring how drug dependence and abuse affects women.
And it turns out that gender differences can be profound.
