Quartz Weekend Brief—#America’s weak power, #India’s soft power, paternity leave, political reincarnation

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Good morning, Quartz readers!

Some American pundits, especially the hawkish ones, welcomed Barack Obama’s UN speech this week as a sign of a more grown-up, aggressive president—one not afraid to call ISIL “evil,” or Russia a “bully,” one who would admonish his Arab allies for letting extremism fester at home, and call all countries to pull together against big, global threats such as climate change and Ebola. “Obama understands today that the US is the world’s indispensable nation,” wrote our colleague Jeffrey Goldberg.

Another way to look at the speech is as a cry for help and an admission of America’s—and in particular Obama’s—weakness.

Obama touted the unprecedented, 40-country coalition the US has assembled against ISIL. But as much as that’s a sign of ISIL’s perceived threat, it’s also a measure of how desperately the US needs this not to look like a US-led war, and indicative of how many countries there are that would have done nothing on their own, despite ISIL being—for now at least—a much bigger direct threat to them than to the US.

Obama’s response to Russia, meanwhile, is little more than a frustrated stamping of the foot—an admission that neither the carrot (the vaunted “reset“) nor the stick (the sanctions imposed since Russia invaded Ukraine) have any influence on Vladimir Putin and his cronies.

And the president’s call to fight climate change—which somewhat embellished how much the US already has done—also was an implicit reminder that, come November and the mid-term elections, Obama’s party probably will have less room to maneuver on that score.

So yes, America is still indispensable—but we shouldn’t confuse that with being powerful. Obama himself clearly doesn’t.—Gideon Lichfield

Tune into Quartz India for a livestream of Indian prime minister Narendra Modi‘s 9/28 speech at Madison Square Garden in New York City starting at 11 am EST and 8:30 pm IST. We’ll take your comments on our Facebook page

Five things on Quartz we especially liked

The case for paternity leave. Giving mothers plenty of time off to raise kids is considered the enlightened thing to do. Gwynn Guilford counters with the definitive argument for why economies worried about a shrinking workforce need to get mothers back into it faster, and why most incentives to get dads to take time off aren’t sufficient.

Foxconn’s reluctant democracy drive. Faced with growing worker unrest, the Taiwanese electronics giant is giving workers and their unions more power. Or so it says. Lily Kuo talks to activists and workers and finds the reality to be a little less glossy.

India’s remarkable space program. While Mars missions have a notorious history of failure, India’s first-ever Mars probe reached the red planet, and on an astonishingly low budget. Saptarishi Dutta breaks the mission down by the numbers (it cost less per kilometer than a Delhi auto-rickshaw) while Devjyot Ghoshal highlights the work of the women who make up 20% of ISRO, the Indian space agency.

Where Facebook and Google are really competing. You might think of one as a social network and the other as a search engine. Instead, says Leo Mirani, think of them both as identity providers, competing to control the data that define who you are in the online world—and offering a range of tradeoffs to entice you.

Narendra Modi’s flawed big idea. India’s prime minister is pushing “soft power” as a way to build Brand India, pointing to the country’s long history of cultural influences, from Buddhism to Gandhi to Bikram yoga. Just one problem, explains Bobby Ghosh: None of these things came from Indian governments.

Five things elsewhere that made us smarter

Warnings for would-be Wall-Streeters. Michael Lewis, one-time Wall Street broker turned blockbuster author, explains on Bloomberg View how the financial industry pressures its new recruits to gradually accept the moral compromises that lead to them doing things that would have horrified their student selves.

Four stories of living with HIV. Thanks to antiretroviral drugs, most people now think of HIV as just another chronic but manageable condition. Patrick Strudwick for Mosaic meets four Britons who describe a much less pleasant reality of continued stigma, associated diseases, drug reactions, and mental-health problems.

Will this be the last Dalai Lama? For most global leaders, their political troubles are over once they die. But for the Dalai Lama, whether or not to reincarnate has become a serious conundrum, tied up with the politics of China’s control over Tibet, as Tim Robertson explains in the Diplomat.

How to tell when a robot is writing to you. It’s easy to spot those automated letters that are made to look handwritten. But why? Clive Thompson at Medium dissects the telltale signs that distinguish human script and speculates on how more cleverly-designed machines could turn handwriting into the new Turing test.

How languages grow up. In Israel’s Negev desert, a community of deaf Bedouins is developing a new sign language that, unlike every other known language, doesn’t exhibit “duality of patterning,” whereby meaningful elements (morphemes) are composed of smaller, meaningless units (phonemes). Julie Sedivy in Nautilus explains what we’re learning from this about the way languages evolve.

Our best wishes for a relaxing, thought-filled weekend. Please send any news, comments, robot-written letters, and strange, new languages to hi@qz.com. You can follow us on Twitter here for updates throughout the day.

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#Obama’s declarations

The United States “will lead a broad coalition to roll back” the “terrorist threat” posed by ISIL, President Barack Obama will say Wednesday night, according to excerpts of his 9 p.m. EDT address released by the White House.

“Our objective is clear: we will degrade, and ultimately destroy, ISIL through a comprehensive and sustained counter-terrorism strategy,” Obama will say.

The president will explain why, in his view, the involvement in Iraq and Syria is not the same as beginning another war in the region.

“I want the American people to understand how this effort will be different from the wars in Iraq and Afghanistan,” Obama will say. “It will not involve American combat troops fighting on foreign soil.”

President Barack Obama used a primetime speech Wednesday to outline his plan to combat the Islamic State of Iraq and the Levant, including U.S. airstrikes and assistance for Syrian opposition groups.

“ISIL poses a threat to the people of Iraq and Syria, and the broader Middle East, including American citizens, personnel and facilities. If left unchecked, these terrorists could pose a growing threat beyond that region – including to the United States,” Obama said from the White House, adding, “we have not yet detected specific plotting against our homeland.”

The battle against ISIL will not be limited by political borders, Obama said. “I will not hesitate to take action against ISIL in Syria, as well as Iraq. This is a core principle of my presidency: if you threaten America, you will find no safe haven.”

Obama did not ask for congressional authorization for the proposal, but he did call on lawmakers to approve “additional authorities and resources” to train and equip opposition fighters in Syria.

Quartz Daily Brief—#NATO and #Ebola summits, #Putin’s ceasefire plan, #Bloomberg retakes control, snail farming profits

Quartz - qz.com
Good morning, Quartz readers!

What to watch for today

NATO’s most crucial summit in years. Although Barack Obama assured Baltic leaders that NATO allies would defend them from Russian aggression, there’ll be much more talk at NATO’s two-day summit in Wales. Leaders will also discuss how to build a coalition against the Islamic State.

A crucial summit for the WHO too. World experts on Ebola converge on the World Health Organization headquarters to make a plan for quick testing of experimental drugs and vaccines. Human trials on one vaccine are beginning in the US this week.

Central bank decisions in Europe. Wholesale price data (paywall), the weakened euro, and Mario Draghi’s big hint at Jackson Hole suggest that the European Central Bank could be close to adopting Fed-style asset-purchasing. At the Bank of England, a divide among policymakers last month brought rate hikes to center stage, but rates are expected to hold, for now.

A US economic data dump. Employment numbers from ADP and Challenger, Gray & Christmas will preview the official US employment jobs report on Friday, which is expected to post major gains. International trade data and Markit’s final composite and services PMI are also due.

While you were sleeping

Putin set terms for a Ukraine ceasefire. The Russian president laid out a plan to end the fighting between Kyiv and pro-Russian forces in eastern Ukraine. Earlier, Russia said it couldn’t sign a formal ceasefire because it is “not a party” to the conflict in Ukraine. (Yeah, right, said Barack Obama.) Separately, The French government suspended its €1.1 billion ($1.5 billion) deal to sell Russia two warships, in the face of growing pressure from its allies.

China and India are skipping the UN’s climate change summit. The absence of the leaders of the world’s largest and third-largest carbon emitters, respectively, will undercut attempts to reach an agreement on cutting greenhouse gases and combating global warming.

Michael Bloomberg is back in business. The former New York City Mayor will once again lead his eponymous media and financial information company, despite his earlier claims that he would focus on giving away his $32.8 billion fortune. Daniel Doctoroff, Bloomberg’s longtime friend and lieutenant, will step aside as Bloomberg LP’s CEO.

New cash cushions for US banks. Regulators adopted rules requiring large banks to keep enough cash—or liquid assets, like government bonds, that can quickly be turned into cash—to survive a funding squeeze. The devil is in the details, namely what kinds of assets will officially count as liquid enough.

Bernie Madoff’s last surviving son died. Andrew Madoff, the convicted Ponzi schemer’s 48-year-old son, had mantle cell lymphoma; his brother Mark committed suicide in 2010. “One way to think of this,” Andrew Marshall once said in an interview, “is the scandal and everything that happened killed my brother very quickly, and it’s killing me slowly.”

Samsung branched out. The world’s top smartphone maker unveiled a strange new gadget with a curved screen. It also revealed its latest Galaxy Note phablet. Don’t laugh, though: Research firm IDC predicted worldwide phablet shipments will overtake laptops this year and tablets next year.

Japan’s central bank declined to make any changes. As expected, the Bank of Japan didn’t announce any new stimulus measures, despite increasing signs that the economy is faltering.

Quartz obsession interlud

Steve LeVine on how Israel is using a gas deal to mend ties with its neighbors. “Israel’s surprising wealth of natural gas—the Tamar and Leviathan fields, together containing the gas equivalent of about 4 billion barrels of oil—was planned for transportation by pipeline or tanker to Europe through Turkey, which could have helped in the current European standoff against Russia. But Israel’s relations with Turkey have deteriorated, putting that plan on the back burner, at least for now. Instead, they will go in large part to Jordan, Egypt and the Palestinian Authority.” Read more here.

Matters of debate

Small victories against the Islamic State are bigger than you think. Advances in Amerli and Tikrit represent “strategic, political, and psychological gains.”

Pakistan’s military is weakening Pakistan. It’s preventing the civilian government from improving.

Carpooling can save the world. Sharing your taxi with a stranger could save time, fuel, the environment, and lives.

Geosynchronous satellites will be humanity’s last remnants. Even after earthly artifacts are gone, there will be a ring of machines 36,000 kilometers (22,369 miles) from Earth.

Surprising discoveries

This German cow has its priorities straight. It escaped a slaughterhouse and headed straight for Oktoberfest.

Microsoft’s Cortana is taking a crack at the NFL. After predicting most of the World Cup matches, the digital assistant is tackling American football.

Chimps can beat humans at some video games. The results suggest they may have a superior memory and grasp of strategy.

There’s money in snail farming. An Austrian man sells 1.5 tons (1.36 tonnes) per year, at prices of up to 80 euros per kg ($50/lb).

North Korea’s volcano mystery might soon be unlocked. The country is giving foreign scientists access to the site of one of the biggest eruptions in human history.

Our best wishes for a productive day. Please send any news, comments, NFL predictions, and snail farming business plans to hi@qz.com. You can follow us on Twitter here for updates throughout the day.

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Websim Focus sui Mercati Finanziari 08/08/2014 – WS

Si preannuncia un’altra giornata di forti turbolenze per i mercati finanziari, dopo che il presidente Barack Obama ha autorizzato un attacco aereo in Iraq contro gli jihadisti. Secondo fonti curde il bombardamento sarebbe già iniziato. Il presidente degli Stati Uniti ha affermato che i raid aerei servono ad impedire il genocidio dei cristiani in fuga.

Stamattina la Borsa del Giappone perde il 3% ed è sui minimi degli ultimi due mesi e mezzo. Seul -1,2%, Mumbay -0,9%, salgono Hong Kong +0,1% e Shanghai +0,3% dopo la diffusione di un dato sull’andamento dell’export cinese molto positivo.

Wall Street ha chiuso in moderato calo: Dow Jones e Nasdaq -0,46%, S&P 500 -0,56%.

I future sulle borse europee anticipano un avvio in ribasso dell’1%.

Modeste per ora le ricadute sui cosiddetti beni rifugio. L’oro tratta a 1.317 dollari l’oncia (+0,4%).

Il prezzo del petrolio tipo Brent ha accelerato sulla notizia e sale dello 0,4% a 106,4 dollari, un prezzo ancora molto lontano dai massimi di giugno a 116 dollari.

Il cross euro dollaro tratta a 1,335 sul dollaro, sui livelli di ieri sera. Draghi ha sottolineato che oggi, più che in passato, ci sono fattori in grado di concorrere a favore di un euro più debole nei confronti del dollaro, tra questi l’aspettativa di una prolungata divergenza tra la politica monetaria portata avanti dalla BCE (Eurozona) rispetto a quella portata avanti dalla FED (USA) e dalla BoE (Giappone). Ciò avvalora la nostra strategia di diversificare sui dollari. Obiettivo finale 1,30/1,27.

Intanto il cambio euro/yen (1,3595) scende su livelli che non si vedevano da novembre del 2013.

Piazza Affari. E’ proseguito il pesante sell off che sta colpendo un po’ tutti i paesi periferici della zona euro. Ieri Milano ha perso l’1,9%, ma anche
Lisbona ha lasciato sul terreno il 2,2% e Madrid l’1,6%.

Ieri Draghi ha richiamato all’ordine tutti i governi che cincischiano sulle riforme strutturali e non abbiamo nulla da eccepire, visto che per il momento è la Bce quella che ha fatto di più per salvare la baracca.

L’Italia un passo avanti importante lo dovrebbe comunque fare oggi con la riforma ormai in fase finale del Senato. Non è vero, come molti commentatori sostengono, che non serve a nulla. Snellire i meccanismi che portano alla legiferazione è fondamentale per il buon funzionamento di uno Stato democratico.

Analisi tecnica borse. L’S&P500 (1.909) resta ancora sopra il primo supporto a 1.900 punti. Il Dax di Francoforte (9.040) sta per raggiungere area 9mila, primo livello interessante per rientrare. L’Ibex di Madrid (10.080) a 10.070/10mila offre un’interessante opportunità di acquisto.
FtseMib (19.130 -1,94%). Si è bruciato quasi 16 punti di guadagno in un paio di mesi. Una perdita che sconta ampiamente le recenti brutte notizie. A rischio l’importante supporto di medio periodo a 19mila il cui cedimento potrebbe provocare pericolosi avvitamenti. Solo il ritorno sopra 19.900/20mila farebbe rientrare l’allerta.

Bond.

Bund tedesco. Le tensioni e la ricerca di “protezione” fanno volare il decennale tedesco sul nuovo massimo storico a 149,6 punti schiacciando il rendimento all’1,033%, un livello che riteniamo insostenibile nel lungo periodo.

Bond periferici. La pressione delle vendite sui listini azionari comincia a incrinare anche il muro dei bond periferici. Lo spread risale a 187 punti base e il rendimento del BTP decennale al 2,90%. Monitoriamo: un eventuale ritorno verso il 3% di rendimento rappresenta un’occasione di acquisto.

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Morning Market Commentary 30-Jul-2014

 

INFOTRIE FinSentS logo

Morning News

Headlines

▪ EU Joins US In Escalating Pressure On Russian Economy

▪ Spanish Economy Expands At Fastest Rate Since 2007 In Q2

▪ Swedish Q2 GDP Misses Forecasts, Up 0.20%

▪ Bundesbank’s Weidmann Welcomes Inflation-Busting German Wage Gains

▪ Argentine Debt Talks To Resume As Default Deadline Looms

▪ Japan June Output Falls At Fastest Pace Since March 2011 Quake

▪ Barclays Profits Down 7% As Investment Bank Income Sags

▪ Bayer Q2 Underlying Profit Edges Higher On New Drug Sales

▪ Airbus Group H1 Core Profit Up, Studies Dassault Stake Sale

▪ Schneider Keeps 2014 Goals After Forex Hits H1 Sales

▪ BBVA Net Profit Falls Sharply

▪ Holcim H1 Profit Declines; Backs Growth Forecast For FY14

▪ Antofagasta Posts Higher Quarterly Copper Output

▪ Twitter Tops Quarterly Estimates for Sales, User Growth

▪ AstraZeneca Announces Almirall Deal Worth Up To $2.1 Bln

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Leaders and Laggers

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Commentary

Fed Seen Trimming Bond Buys, Could Offer Vague Rate Clues Federal Reserve on Wednesday looks certain to press forward with its plan to wind down its bond-buying stimulus, and could offer some vague clues on how much nearer it might be to finally raising interest rates. (Reuters – Continue Reading)

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Russia Sanctions Spread Pain From Putin To Halliburton
U.S. and European Union sanctions against Russia’s Vladimir Putin threaten to shut off some of the world’s largest energy companies from one of the biggest untapped energy troves on the planet.

As violence escalates in eastern Ukraine between government and separatist forces, the EU yesterday sought to punish Russia for its involvement by restricting exports of deep-sea drilling and shale-fracturing technologies. The U.S. followed suit, with President Barack Obama announcing a block on specific goods and technologies exported to the Russian energy sector.

“Because we’re closely coordinating our actions with Europe, the sanctions we’re announcing today will have an even bigger bite,” Obama told reporters yesterday at the White House. “Russia’s energy, financial and defence sectors are feeling the pain.” (Businessweek – Continue Reading)

Europe’s Bond Yields Lowest Since 15th Century Genoa On Deflation, Russia Risk
Bond yields have fallen to the lowest level in modern history in Germany, France and the Eurozone’s core states, signalling a high risk of deflation and mounting concerns about sanctions against Russia.

The yield on German 10-year bonds fell to a record low of 1.11pc in intra-day trading, partly on safe-haven flows. French yields dropped in tandem to 1.5pc. These levels are far below rates hit during the 1930s or even during the deflationary episodes of the 19th Century.

“Yields fell this low in Genoa in the 15th century but there has been nothing like this in Europe in modern times,” said professor Richard Werner, from Southampton University. “This reflects the weakness in nominal GDP and a slow economic implosion caused by credit contraction. The European Central Bank is at last starting to act but it is only scratching the surface.” (Telegraph – Continue Reading)

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JPMorgan Says Don’t Fight PBOC As Stimulus Lifts Stocks
Don’t fight the People’s Bank of China.

That’s the advice to investors from Adrian Mowat, the Hong Kong-based chief Asia and emerging-market strategist at JPMorgan Chase & Co. who raised his rating on Chinese stocks to neutral from underweight in a report dated yesterday. He said shares will rally through October after the Hang Seng China Enterprises Index (HSCEI) entered a bull market on July 28.

China’s central bank presided over a bigger-than-estimated surge in new credit in June and has cut reserve requirements for some lenders, while local media reported the PBOC set up a 1 trillion yuan ($162 billion) lending facility with the China Development Bank to fund housing projects. The signs of monetary easing, along with accelerated government spending and gains in manufacturing industries, have spurred mutual fund managers to boost Chinese stock holdings to record highs, according to a July 28 report from HSBC Holdings Plc. (Bloomberg – Continue Reading)

Time Almost Up For Argentina To Avoid Debt Default
Argentina faced a race against on time on Wednesday to avert its second default in 12 years, needing to either cut a deal by the end of the day with “holdout” investors suing it or win more time from a U.S. court to reach a settlement.

Argentine Economy Minister Axel Kicillof scrambled to New York on Tuesday to join last-ditch negotiations, holding the first face-to-face talks with the principals of New York hedge funds who demand full repayment on bonds they bought at a discounted rate after the country defaulted in 2002.

The hedge funds are owed $1.33 billion (784 million pounds), but an equal treatment clause in an agreement Argentina made with bondholders in 2005 would cost Argentina many billions more. (Yahoo – Continue Reading)

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Files and Links

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HEADLINES

EU Joins US In Escalating Pressure On Russian Economy

Spanish GDP (QoQ) Q2 P: 0.60% (est 0.50%; prev 0.40%)

Swedish GDP (QoQ) Q2 P: 0.20% (est 0.60%; prev -0.10%)

Bundesbank’s Weidmann Welcomes Inflation-Busting German Wage Gains

Argentine Debt Talks To Resume As Default Deadline Looms

Japan Industrial Production (MoM) Jun P: -3.30% (est -1.20%; prev 0.70%)

Barclays Profits Down 7% As Investment Bank Income Sags

Bayer Q2 Underlying Profit Edges Higher On New Drug Sales

Airbus Group H1 Core Profit Up, Studies Dassault Stake Sale

Schneider Keeps 2014 Goals After Forex Hits H1 Sales

BBVA Net Profit Falls Sharply

Holcim H1 Profit Declines; Backs Growth Forecast For FY14

Antofagasta Posts Higher Quarterly Copper Output

Twitter Tops Quarterly Estimates for Sales, User Growth

Toyota Keeps Global Lead Over VW On Surging SUV Demand

AstraZeneca Announces Almirall Deal Worth Up To $2.1 Bln

Icahn Cuts Stake In Family Dollar

Bank Of America Nearly Halves Exposure To Russia

MARKET DATA

 

POLITICO Breaking News @politico

President Barack Obama on Tuesday again escalated U.S. sanctions against Russia in the energy, arms and finance sectors, but said the international tensions are “not a new cold war.”

“Today, Russia is once again isolating itself from the international community, setting back decades of genuine process,” Obama said from the South Lawn of the White House, later adding, “it does not have to be this way. This is a choice that Russia and President Putin in particular have made.”

Obama’s statement came after European leaders agreed to dramatically intensify the squeeze on Moscow over its alleged efforts to foment unrest in Ukraine.

POLITICO Breaking News @politico

President Barack Obama slapped Russia with another batch of economic sanctions on Wednesday for its incursions into Ukraine, including new restrictions on Russian government leaders, major banks and even the maker of the iconic Kalashnikov assault rifle.

Among those sanctioned were a top Russian spymaster, a Ukrainian separatist leader, a top lawmaker and Moscow’s minister for the Crimea, which Russian troops seized in an armed incursion earlier this year. The Treasury Department also sanctioned Russian arms manufacturers, parts of energy companies and financial institutions.

“We have to see concrete actions and not just words that Russia is in fact committed to end this conflict along the Russia-Ukraine border,” Obama said in the White House press briefing room. Thus far, he continued, “Russia has failed to take any of the steps” that the Obama administration called for to de-escalate the situation in Ukraine.