Financial Markets and Economy
Six Warning Signs That the Economy Is in Trouble (Value Walk)
On July 14, I wrote about the danger developing in the transportation sector, and things are looking even worse today.
These Are the Diverging Fates of Italy's Two Greatest Cities (Bloomberg)
One was the 2015 New York Times pick for top destination. The other is hogging headlines for all the wrong reasons.
The rivalry between Milan and Rome is a tale as old at time, a favorite topic of discussion by Italians over their morning espresso. Italy’s financial nerve center and fashion capital is efficient and elegant. The seat of government and Catholicism is gorgeous yet decrepit and full of crooks. The Milanese are stuck-up and work hard. Romans are laid-back and lazy.
But how true are these common tropes? Here is how the two cities really stack up.
Here’s why the bears may claw the stock market soon (Market Watch)
Wall Street’s rather befuddling slog this year has spanned another season of high-profile earnings reports. And while some stocks have moved big, the overall market environment continues to be pretty lackluster.
The S&P 500 SPX, -0.22% is barely in the black for the year, breadth and volume are thin, and investors are scratching their heads about where the market goes from here.
Eurozone retail sales bombed in June (Business Insider)
Eurozone retail sales missed expectations in June, sinking by 0.6% compared to the previous month.
That leaves sales up just 1.2% compared to the same period last year.
Analysts expected a 0.3% fall in retail sales in June, compared to May, which would have still left them up 1.9% year-on-year.
The Euro Isn't Dead (Euro Pac)
While the world can count dozens of important currencies, when it comes to top line financial and investment discussions, the currency marketplace really comes down to a one-on-one cage match between the two top contenders: the U.S. Dollar and the Euro.
Why rich Americans thought it was a good idea to lend billions to Puerto Rico (Quartz)
Puerto Rico defaulted. And no one should be surprised.
Yuan Seen Pegged Into 16 as IMF Extends Reserve-Currency Window (Bloomberg)
China will probably keep the yuan pegged to the dollar into 2016 after the IMF signaled a delay to giving it reserve status.
Why grandma should be buying Greek stocks (Market Watch)
Greek stocks are now a bargain, and they belong in any well-diversified portfolio, writes Brett Arends.
Some Clear Thinking About The Price Of Gold (Sovereign Man)
On April 2, 2001, the price of gold closed the market trading session at $255.30.
And that was the lowest price that gold has seen ever since.
In US dollar terms, gold closed the 2001 calendar year higher than it did in 2000. Then it did the same thing again in 2002. And again in 2003.
Greek bank shares plunge for third day, stock market down 1.3 percent (Business Insider)
Greek bank shares sold off sharply pressure for the third day in a row on Wednesday with the bank sector share index <.FTATBNK> losing 14.8 percent in early deals.
The broader market <.ATG> reversed small opening gains to trade lower, dragged down by the banks which comprise about 20 percent of the main index.
Athens bourse's benchmark general index <.ATG> traded 1.28 percent lower after losses of 1.2 percent on Tuesday.
Banks Snub Summer Break for New Bonds With Riskiest-Debt Revival (Bloomberg)
Even as much of Europe’s bond market slows down for the summer holidays, sales of the riskiest bank debt are surging back to life.
Barclays Plc and UBS AG have sold a combined $3.1 billion of additional Tier 1 bonds in the last five days, ending a seven-week sales drought. Royal Bank of Scotland Group Plc last week unveiled plans to raise 2 billion pounds ($3.1 billion) selling similar dollar-denominated notes.
U.S. stocks: Futures higher as Wall Street tries to end 3-day skid (Market Watch)
U.S. stocks looked on track to mostly rise Wednesday and recover a bit after a three-day skid, though the Dow was set to open roughly flat as Walt Disney’s weaker-than-expected quarterly sales weighed.
Analysts said investors are wary ahead of Friday’s monthly jobs report, and a hint of how that report might look will arrive Wednesday, with the ADP’s private-sector employment data.
Russian inflation is refusing to go away quietly (Quartz)
Just a little while ago, the spectacular fall in the ruble was pushing inflation sky high and scaring Russians into hoarding luxury goods to protect their wealth. Then, things calmed down. But now inflation is rearing its head again.
Capital Economics pointed out in a note to clients that utilities have a big part in this—Russia’s economy minister said as much a few days ago.
Europe Index Futures Advance, Signaling Stock Rally to Resume (Bloomberg)
European stocks resumed their rally as commodity producers rose for a second day and Societe Generale SA jumped after reporting its highest profit since the financial crisis.
Shares of France’s second-largest bank by market value rallied 8.1 percent. Mediobanca SpA rose 2.8 percent after raising its dividend. Legal & General Group Plc climbed 2.1 percent after the biggest manager of U.K. pension assets, reported first-half profit that beat analysts’ estimates amid a jump in inflows. BHP Billiton Ltd. and Rio Tinto Group advanced more than 2.4 percent.
European stocks on course for highest close in three weeks (Market Watch)
European stocks climbed Wednesday, on track for their best close in more than three weeks, as investors responded to corporate earnings reports.
The Stoxx Europe 600 SXXP, +0.79% rose 0.8% to 401.83, with gains in all sectors.
The Spanish economy just blew analyst expectations out of the water (Business Insider)
On Wednesday morning the latest purchasing managers' index (PMI) business surveys rolled out for July, and it was the turn of the services sector.
Anything over 50 shows growth, and anything below indicates that a sector is contracting.
Spain's services sector saw the fastest hiring in 8 years, and was the real shocker from the July release. Some analysts had wondered whether the booming Iberian economy might be slowing down in the second half of the year, but there's no sign of that here.
The Singapore Way: Very Rich and Living With Mum (Bloomberg)
Everyone knows Singapore is an expensive country that's transforming itself into a smart city. Here are five less-known facts about the island nation as it marks its 50th year of independence.
These two industries are bullish for the U.S. economy (Market Watch)
With all the hand-wringing about how weak this economic recovery has been, with the second-quarter GDP growth rate of 2.3% being hailed as a triumph, the U.S. consumer economy has quietly emerged as a real source of strength.
Automotive and housing sales have once again begun to fulfill their traditional role as twin pillars of an economic recovery. And, unlike a few years ago, average middle-class people, not just the wealthy, are buying.
Greece needs €95 billion in debt relief to avoid permanent depression — twice as much as the IMF says (Business Insider)
Greece may have a bailout deal, but the debt relief that the country actually needs is bigger than any of the participants is admitting — and without it, the country will be stuck in a semi-permanent depression.
That's according to the National Institute of Economic and Social Research (NIESR).
Gold won’t have been tested until the crap really hits the fan (Market Watch)
Gold hasn’t fulfilled its role as a safe haven during the latest crises, but we haven’t had a real crisis yet, says Matthew Lynn.
Oil bulls' hope for quick price dip dimmed by 2020 crude under $70 (Business Insider)
As oil prices entered a second steep slide a few weeks ago, bullish traders and analysts had hoped for a repeat of the sharp but short dip that occurred early in the year – a speculative slide below $50 a barrel followed by a quick recovery.
Some are now reconsidering that view, as long-term oil prices take the lead in the market's latest dive, swaying sentiment toward a lengthier slump that would mean prolonged pain for big producers, from Exxon Mobil Corp <XOM.N> to Saudi Arabia.
Chinese Stock Short Squeeze Stalls After IMF Delays Decision On Yuan SDR Inclusion (Zero Hedge)
Yesterday afternoon's meltup short-squeeze in China – after regulators announced their latest restrictions on short-selling – has stalled in the early trading tonight following TheIMF's decision to delay inclusion of Yuan in the SDR pending a review in September 2016. Though this will be a disappointment to the Chinese, the door is still open though given waringse from BMW and Toyota over "normalizing" auto sales, the market problems may be morphing quickly into economic problems.
Politics
The Republican Road Block Ahead (The Atlantic)
We head into the first presidential debate in Cleveland with Donald Trump leading the field and confounding the confident predictions of a slew of pundits that his collapse was at hand—whether after the Mexican-rapists comment, the slam at John McCain as no hero, or other statements that offended elites but only seemed to attract more support from Republican hoi polloi. What explains the Trump bump? The answer is the emerging, even dominant force in the GOP—an angry, anti-establishment, anti-leadership populism that was triggered by the financial crisis and the 2008 bailout, cynically exploited in 2010 and 2012 by the “Young Guns” in the House and other GOP leaders in Congress to convert anger into turnout and elect Tea Party-oriented candidates.
Putin Accused of Terror Against Elite by Barred Opposition (Bloomberg)
Russian opposition leader Alexey Navalny accused President Vladimir Putin of waging a campaign of “terror” to keep the country’s elite loyal and said the government is blocking anti-Kremlin candidates from elections.
Navalny, an anti-corruption lawyer who challenged a Putin ally for Moscow mayor in 2013, said the authorities are orchestrating moves to keep the opposition off the ballot in regional polls in September. His pro-democracy coalition wants to use the vote as a springboard to gain seats in parliament next year.
Joe Biden finally breaks his silence on 2016 speculation (Salon)
The New York Times set off a fresh round of speculation over the weekend that Joe Biden may enter the 2016 presidential contest, first with a Maureen Dowd column reporting that Biden "has been having meetings at his Washington residence to explore the idea of taking on Hillary in Iowa and New Hampshire," and then with an article from the paper's Amy Chozick essentially corroborating Dowd's reporting.
Technology
Two Mac viruses strike at the heart of the platform's secure image (The Guardian)
‘Thunderstrike 2’, a worm which moves from Macbook to Macbook using hardware, joins privilege escalation bug seen in the wild for the first time
For years, Mac users have been safe in the knowledge that their platform was relatively safe from malware. A combination of the lower number of users on the platform, less attention from security researchers and, in general, fewer security holes in the operating system than Windows has led to a history generally free of damaging viruses and malware. So proud has Apple been of its security that it even ran several spots in its Mac vs PC ad campaign dedicated to the idea that Macs don’t get viruses.
Health and Life Sciences
Team identifies mutations that allow bacteria to resist antibiotics (Phys)
Rice University scientists are developing strategies to keep germs from evolving resistance to antibiotics by heading them off at the pass.
The Rice lab of biochemist Yousif Shamoo identified a genetic mechanism that allows bacteria to develop resistance while simultaneously and quickly spreading the capability to others in a population.
Brain regions cooperate to put off a reward (Futurity)
New research with rats demonstrates that the hippocampus—associated with memory—and the nucleus accumbens—associated with pleasure—work together to make critical decisions that call for delayed gratification.
The researchers show that when these two structures were effectively “disconnected” in the brain, there is a disruption of decisions related to delayed gratification.
Life on the Home Planet
Caution Urged over Editing DNA in Wildlife (Scientific American)
“Crap!” That was the first word out of Kevin Esvelt’s mouth as he scanned a paper published in Science last March. The work described the use of a gene-editing technique to insert a mutation into fruit flies that would be passed on to almost all of their offspring. Although intriguing, the report made Esvelt feel uneasy: if engineered flies escaped from a lab, the mutation could spread quickly through a wild population.
Loss of world's rarest ape charted (BBC)
Historical Chinese documents have helped scientists to track the decline of the world's rarest primates.
Today, China has between 26 and 28 Hainan gibbons left, but government records that date back to the 17th Century show that gibbons were once widespread across half of the country.
The apes began to disappear from the documents about 150 years ago, corresponding with population growth.
