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4 September 2019. By John Ellis.
1. Embattled Hong Kong leader Carrie Lam Cheng Yuet-ngor is set to formally withdraw the much-despised extradition bill that sparked the nearly three-month long protest crisis now roiling the city, sources have told the Post. The decision will mean that the government is finally acceding to one of the five demands of the protesters, who have taken to the streets over the past 13 weeks to voice not just their opposition to the legislation, but the overall governance of the city.
2. China has called Hong Kong protesters political terrorists bent on seizing power and warned that it would not tolerate chaos indefinitely after the worst violence to hit the territory since the demonstrations began in June. The remarks by Yang Guang, spokesman for the Hong Kong and Macau Affairs Office, suggested the political crisis had entered a new phase, with the escalating disruption in the territory severely testing Beijing’s patience.
3. Chinese President Xi Jinping urged the ruling Communist Party to brace for a “long-term” struggle against a variety of threats, the latest in a series of warnings to a nation facing a slowing economy and a more confrontational U.S. Xi said officials needed to display a “fighting spirit” to overcome challenges ranging from security concerns to financial risks, according to the official Xinhua News Agency. “The struggles we face will not be short term, but long term,” Xi told a cadre training course Tuesday in Beijing, adding that difficulties would persist through at least 2049, the 100th anniversary of the People’s Republic of China.
4. President Trump said on Tuesday that Chinese manufacturing would “crumble” if the country did not agree to the United States’ trade terms, as newly released data showed his trade war was washing back to American shores and hurting the factories that the president has aimed to protect.
5. The U.S. manufacturing sector shrank for the first time in three years last month, providing the latest sign that a global manufacturing pullback is weighing on the American economy amid rising trade tensions between Washington and Beijing. Tuesday’s Institute for Supply Management’s manufacturing index, a widely watched gauge of factory activity, fell to 49.1 in August from 51.2 in the prior month. Readings above 50 indicate activity is expanding across the manufacturing sector, while those below 50 are a sign of contraction.
6. Recession fears crescendoed after the Institute for Supply Management said Tuesday that its monthly index of U.S. manufacturing fell below the dividing line that separates expansion from contraction for the first time since 2016. Stocks fell and government bonds rallied as traders priced in greater amounts of monetary policy easing by the Federal Reserve before the year is out. Credit markets, however, were unusually sanguine in what may be the ultimate referendum on the state of the economy.
7. Investors already preoccupied with the trade battle between the U.S. and China and the prospect of a recession have another frustration: thinning liquidity. The end of summer tends to be a slower period on Wall Street because of vacations and a sparse slate of economic data and earnings, but traders and analysts said the past month was marked by even lower-than-normal liquidity—a measure of how easy it is to buy or sell different investments. The problem is plaguing everything from stocks and bonds to currencies and derivatives, potentially exaggerating big moves across markets, analysts said.
8. Some US investors are girding themselves for the once-inconceivable prospect that the 10-year Treasury yield could be headed towards zero, as this year’s giant rally in bonds shows few signs of easing. Said Steve Major, global head of fixed income research at HSBC: “To jump from here to zero is a long way. But the chances of yields going back to where they were at the beginning of the year? Forget it.”
9. The dollar ticked higher Tuesday, touching its highest level in more than two years as the gloomy outlook for global growth, rising U.S.-China trade tensions and political turmoil in Europe weighed on major currencies world-wide. The ICE Dollar Index, which tracks the currency against a basket of its peers, hit 99.37, its highest level since mid-2017, before paring its gain later in the day.
10. Boris Johnson lost control of Brexit last night as MPs paved the way for an extension of the October 31 deadline. The prime minister also faced being unable to carry out his threat of calling a snap election after suffering a humiliating defeat in his first Commons vote. MPs took control of the parliamentary agenda by 328 votes to 301, a majority of 27. The government confirmed that it would strip the whip from the 21 Conservatives, including nine former cabinet ministers, who rebelled. The vote means that legislation forcing Mr Johnson to secure another Brexit delay is likely to pass today as opposition parties and Tory rebels combine to stop a no-deal exit next month.
11. Jeremy Corbyn will block Boris Johnson's attempts to call a snap election today as the Labour leader was accused of leading a "junta" to stop Brexit. Sir Keir Starmer has confirmed that Labour will not be voting for an election, saying his party will not "dance to Boris Johnson's tune." Instead, the shadow Brexit secretary indicated this morning that Labour would wait until no-deal had been ruled out by law, before allowing Mr Johnson to go to the country.
12. Eurointelligence: "As Daniel Finkelstein writes in his Times column this morning, this process will end up as a fundamental choice between of two options: a Corbyn government versus a no-deal Brexit. Put this way, it sounds like a category error. But this is going to be the choice. For as long as he is labour leader Corbyn will always insist that he should lead the government. And that means that he will remain the only alternative to the existing government. And yesterday’s events have finally transformed the Tories into a relatively united, albeit smaller, Brexit Party. Finkelstein says this choice is a tragedy. He himself, a Tory Lord, is firmly opposed to a no-deal Brexit, and cannot reconcile himself with it. But when push comes to shove, the one thing he will not do is choose Corbyn over a no-deal Brexit."
13. A group of the world’s leading business federations from Japan to the US have warned Britain against crashing out of the European Union without a deal. The organizations, representing four million companies from eight countries, say a no-deal Brexit would “create substantial disruption for businesses, workers, farmers and regulators” and has made them “gravely concerned.”
14. Jeremy Corbyn, the scourge of bankers and avowed opponent of capitalism, is winning support from unexpected new quarters: two of the biggest global banks operating in the City of London are warming to the Labour leader. Unlikely as it may seem, he is now seen as the lesser of two evils by analysts at Citibank and Deutsche Bank, respectively American and German titans of the financial system.
15. Britain’s construction industry has suffered its sharpest drop in new orders since the depths of the recession a decade ago, with clients delaying projects as they await clarity over Brexit. August’s purchasing managers’ index for construction showed that activity fell to 45 from 45.3 in July, below forecasts for 45.9 — any reading below 50 indicates contraction. Pulling the sector down was “the sharpest reduction in new work since March 2009”, which was blamed on “delayed decision-making among clients in response to domestic political uncertainty.”
16. Members of Italy’s antiestablishment 5 Star Movement voted to form a coalition government with its former center-left Democratic Party foes, clearing the last major hurdle to new leadership. The move heads off the risk of new elections and prolonged political instability after Matteo Salvini ’s anti-immigration League withdrew its support of government last month in a bid to force early elections that polls suggest it would have won. But even before the new government starts, questions over its longevity began to percolate, given the ideological and policy differences that divide its members.
17. The majority of America’s ambassadors to Afghanistan since the removal of the Taliban government have condemned the US approach to negotiating a troop withdrawal, warning it risked a return to “total civil war”. Writing the day after a draft agreement was announced, the nine men, including a former deputy secretary of state, said they supported peace talks in Afghanistan.
18. Tomorrow’s wars will be faster, more high-tech, and less human than ever before. Welcome to a new era of machine-driven warfare. Lethal, largely autonomous weaponry isn’t entirely new: A handful of such systems have been deployed for decades, though only in limited, defensive roles, such as shooting down missiles hurtling toward ships. But with the development of AI-infused systems, the military is now on the verge of fielding machines capable of going on the offensive, picking out targets and taking lethal action without direct human input.
19. Scientists in southeast China say they have synthesized a crystal with the potential to significantly improve the performance of lasers used in consumer and military equipment. Crystals of caesium bismuth germanate (CBGO) can turn low-energy beams into high-energy emissions with unparalleled efficiency, according to Professor Mao Jianggao, team leader at the Fujian Institute of Research on the Structure of Matter, part of the Chinese Academy of Sciences, in Fuzhou.
20. In five years, 39 million home care and personal/social robots a year will be shipped, and almost 79 million homes around the world will have robots in them, predicts a new report from ABI Research. Robotic capabilities will be particularly useful for older adults who are aging in place or for ambient assisted living end-users, according to the report. (Ambient assisted living tools are designed to be sensitive and responsive to the presence of people). Amazon and Google are positioned well to lead in social robot advances because artificial intelligence and voice recognition are the basis of their Alexa and Assistant platforms, which are already popular, the report authors stated.
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