Friday's News Items.
23 August 2019. By John Ellis.
1. The Army has identified two Special Forces soldiers killed in Afghanistan on Wednesday, as the casualties in the country hit the highest level in five years. Master Sgt. Luis F. DeLeon-Figueroa, 31, and Master Sgt. Jose J. Gonzalez, 35, were killed during combat operations in Faryab province, located in the far northwest of Afghanistan along the border with Turkmenistan. “It was an honor having them serve within the ranks of 7th SFG (A). They were a part of our family, and will not be forgotten,” said Col. John W. Sannes, 7th Group commander, in a statement.
2. China’s development of a hypersonic ballistic missile – capable of reaching well above the speed of sound and penetrating US missile shields – is a threat to stability in the region, a military analyst has warned. A source from the state-owned China Aerospace Science and Industry Corporation (CASIC) said the DF-17 missile, currently in development, would be capable of hypersonic speeds and delivering a maneuverable re-entry vehicle which could shift targets in flight, making it less vulnerable to interception by other countries’ defense systems.
3. Hong Kong braced for multiple anti-government demonstrations on Friday and a “stress test” of the airport this weekend, as weeks of protest in the Chinese-ruled city showed no signs of let-up amid rising tension between China and some Western nations. “Go to the airport by different means, including MTR, airport bus, taxi, bike and private car to increase pressure on airport transport,” protest organizers wrote online ahead of a protest this weekend.
4. Authorities in the main city of Indian Kashmir tightened security ahead of Friday prayers after separatists called for a protest march to a U.N. office, with streets bristling with paramilitary personnel and some blocked by checkpoints. Posters appeared overnight this week in Srinagar, the Muslim-majority region’s main city, calling for a march to the office of the U.N. Military Observer Group for India and Pakistan (UNMOGIP), to protest against India’s revocation of Jammu and Kashmir state’s special autonomy.
5. Russia’s Rosatom will ship its first floating nuclear-power reactor on Friday, setting the unit off on a barge journey among Arctic ice caps, raising concerns in the wake of a recent military accident that caused a brief spike in radiation.
6. As dozens of fires scorched large swaths of the Amazon, the Brazilian government on Thursday struggled to contain growing global outrage over its environmental policies, which have paved the way for runaway deforestation of the world’s largest rain forest. The fires, many intentionally set, are spreading as Germany and Norway appear to be on the brink of shutting down a $1.2 billion conservation initiative for the Amazon. Concern over the environmental policies of President Jair Bolsonaro, which have prioritized the interests of industries that want greater access to protected lands, has also put in jeopardy a trade agreement the European Union and a handful of South American nations struck in June, following decades of negotiations.
7. Activity in America’s factory sector has contracted for the first time in almost a decade, a survey of executives showed, adding to concerns that slowing global growth and the US-China trade war are weighing on the industrial economy. IHS Markit’s US manufacturing purchasing managers’ index dropped to 49.9 in August, falling below the neutral level of 50 for the first time since September 2009.
8. Underscoring divisions within the Federal Reserve over how to respond to signs of a global economic slowdown, two officials on Thursday said they see no need to lower borrowing costs next month, while another said he was “open-minded.” Kansas City Fed President Esther George, who dissented against the U.S. central bank’s decision to cut rates last month, and Philadelphia Fed President Patrick Harker, who said he “reluctantly” supported the rate cut, both said the U.S. economy does not need more stimulus at this point.
9. Shorter-dated Treasury yields once again eclipsed those for longer-dated notes on Thursday, signaling fears among bond market investors that the Federal Reserve will fail to cut its benchmark rate fast enough to shield the US economy from slowing global growth and an escalating trade dispute with China. For the third time this month, the yield on two-year US Treasury bills jumped above that of the benchmark 10-year note during the trading day.
10. Investors have pulled $33 billion from US leveraged loan funds this year as falling interest rates and a string of shelved deals signal a weakening of confidence in the asset class. Mutual funds and exchange traded funds that invest in US leveraged loans have shed $2.6 billion since the start of August alone and are on track for their largest annual withdrawals on record, according to EPFR Global data. The previous record for outflows was $24 billion in 2015.
11. Investors pulled around $56 billion from hedge funds in the first seven months of this year, the worst start for fundraising since 2016 despite the best stretch of performance in a decade for the struggling industry. Only 37 per cent of hedge funds have had net inflows so far this year, according to data from eVestment published on Thursday.
12. Germany is examining plans to prohibit banks from imposing negative interest rates on savers, threatening to leave lenders in an impossible position and greatly complicating the job of the European Central Bank as it prepares fresh stimulus. The outlandish move comes amid growing German irritation with the radical monetary experiments of the ECB and its policy of negative rates - currently minus 0.4pc but soon to go yet lower - deemed an assault on hard-working savers and known as “punishment rates” by the country’s media.
13. Italy’s center-left Democrats have until Tuesday to form a coalition with their long-time rivals, the anti-establishment Five Star Movement, after President Sergio Mattarella gave them more time to put together a new parliamentary majority. As head of state, Mattarella holds the power to either appoint the next prime minister or call early elections, the two options to lift Italy -- which has averaged about one government a year since World War II -- out of its latest political crisis.
14. According to a new study by researchers at MIT and in California, because of climate change there is an increasing risk that in coming years, conditions of heat and humidity in the areas of Saudi Arabia where the Hajj takes place could worsen, to the point that people face “extreme danger” from harmful health effects. In a paper in the journal Geophysical Review Letters, MIT professor of civil and environmental engineering Elfatih Eltahir and two others report the new findings, which show risks to Hajj participants could already be serious this year and next year, as well as when the Hajj, whose timing varies, again takes place in the hottest summer months, which will be from 2047 to 2052 and from 2079 to 2086.
15. A fast-moving wildfire that broke out on Thursday in northern California has forced the evacuation of nearly 4,000 residents, racing across at least 600 acres within just a few hours, officials say. The Mountain fire, which erupted on the outskirts of a national forest in northern California, has threatened 1,110 homes and structures. As of Thursday evening the fire was 0% contained and officials in Shasta county described the situation as “very fluid.”
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Quick Links: Europe to see third major heat wave this summer. Facebook’s Libra bets it can bank the unbanked. Facebook’s Libra backers look to distance themselves from project. EU floats plan for €100 billion sovereign wealth fund. The Pentagon is turning to nature to solve its most complex problems. A super-secure quantum internet just took another step closer to reality. Artificial intelligence is improving the way humans think. An ingenious microscope could change how quickly disease is detected. Most heterosexual couples today meet online. Silicon Valley is going to Mexico.....for talent. The Economist is underwhelmed by the new credit card from Apple and Goldman Sachs. NewsPicks morphs into Knewz. Taylor Swift’s asset restructuring. Idaho rider Bob Long, 70, wins Genghis Khan race. Geezers gone wild.
Political Links: Jay Powell set to speak today at Jackson Hole conference. WSJ Editorial Page: With demand high, now is the time to float a really long bond. Quartz: The case for a 100-year US government bond. Nervous retirees are too scared to spend. AP-NORC poll: 62% disapprove of how Trump’s handling his job. Joe Biden has an "enthusiasm challenge." Nikki Haley puts to rest non-existent rumors. The surprising surge of Andrew Yang. Bernie Sanders offers a massive climate plan. Hickenlooper to run for Senate in Colorado. Secretary of State Pompeo under pressure to run for Senate in Kansas next year. Susan Glasser's profile of Mr. Pompeo is here. Sen. Cotton (R-AR): Greenland was my idea. God help us: Anthony Scaramucci is here to save us all.