Auto Makers Report Stronger U.S. Sales
General Motors, Chrysler and Nissan reported strong year-over-year gains in U.S. auto sales for August as the industry shook off weak sales in July.
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The middle class: Bourgeois and proud
The ever-expanding middle class in developing countriesTHE past four years have seen a sharp contrast between recession-hit rich countries and buoyant emerging giants. Estimates from the Asian and African Development Banks, using a rather broad definition of middle class as living on $2-20 a day, confirm the picture. On this measurement, which includes many people who are only just above the poverty line, a third of Africans and three-quarters of Latin Americans were middle class in 2008. Meanwhile, the evidence that this progress will bring political demands that will reshape the developing world is mounting.
International financial flows: Around the crisis carousel
I’VE been thinking a lot about this Michael Pettis post from the weekend, in which he offers some economic predictions for the remainder of the decade. What’s most interesting about his thinking is the way he orients his model of economic activity around balance of payment dynamics. Here’s an example:Since most global consumption comes from the US, Europe and Japan, the collapse in their demand will ultimately be very painful for the BRICs and the rest of the developing world. The latter have postponed the impact of contracting consumption by increasing domestic investment, in some cases very sharply, but the purpose of higher current investment is to serve higher future consumption. In many countries, most notably China, the higher investment will itself limit future consumption growth, and so with weak consumption growth in the developed world, and no relief from the developing world, today’s higher investment will actually exacerbate the impact of the current contraction in consumption.Mr Pettis argues that the pivot around which the BRIC economies (and China especially) swing is reliance on advanced-country demand. As that anchor (sorry, mixing metaphors) becomes dislodged, BRIC economies will face difficult internal structural changes.You might not buy all of his predictions, but it’s a compelling way to view the big trends in the global economy, and especially the …
Charlemagne: The end of Monnet
UK Only Article: standard article Issue: Ten years on Fly Title: Charlemagne Rubric: The debt crisis is exposing problems in the basic design of the European Union Main image: 20110903_EUD000_0.jpg CALL it the curse of the euro. When politicians discuss the single currency’s crisis in Brussels, their actions are invariably seen by markets to be too little, too late. When they return home, they are accused of surrendering too much, too fast. So bond markets swoon and leaders become enfeebled. Such has been the fate of last July’s summit deal to save Greece for the second time and boost the embryonic European monetary fund. Government debt is dangerously wobbly in Italy and Spain, yet political approval of the deal has hit trouble in Germany and Finland. “The European Union”, bemoans one veteran Eurocrat, “was not designed to deal with a crisis.” Blame Jean Monnet, the EU’s godfather. The French functionary believed in gradually unifying post-war Europe through discrete projects run by …
DOJ Sues to Block AT&T, T-Mobile Deal
The Justice Department is suing to block AT&T’s proposed $39 billion takeover of T-Mobile, saying the deal would hurt competition and likely raise prices.
Rosneft, Exxon Set Global Partnership
Exxon Mobil snatched away a major Arctic exploration deal with Russia’s Rosneft from competitors including BP in a sweeping deal that will give Rosneft access to energy projects in the U.S.
Letters from our readers: The editor’s inbox
We received this interesting insight on the famine in the Horn of Africa from the head of DARA, an organisation that evaluates humanitarian aid operations:SIR – Your article on the situation in the Horn of Africa is sadly correct: in effect the world failed to react to the warning signs that a famine was imminent in the region until images of emaciated children were on our television screens. In February we sent a team to Nairobi to assess the response to the drought in Kenya and the crisis in Somalia for the Humanitarian Response Index. All the representatives from donor governments, the UN and other aid agencies interviewed were concerned that the situation would worsen dramatically if the April seasonal rains did not come.Even back in February there was a daily increase in the number of Somalis seeking access to refugee camps in Kenya and Ethiopia in large part due the severity of the drought, a clear indicator that the problems were getting worse. Clearly, it was not a lack of information that impeded the international community to take early action to prevent loss of lives and minimise suffering. So why did it take so long for the world to react?One of the explanations for the delayed response is the highly politicised nature of the Somali crisis, where many of the different actors—al-Shabaab, the Transitional Federal Government, governments in neighbouring Kenya and …
Big Pharma’s New Prescription
Meet the new blockbuster: drugs like Pfizer’s Xalkori that treat intractable diseases afflicting small numbers of patients shown by testing to likely benefit from the drug.
Money talks: economics: Money talks: August 29th 2011
Bernanke says little at Jackson Hole, predictions about Obama’s Labour Day jobs speech and the euro zone’s gloomy outlook
BofA Cashes Its China Chips
Bank of America Chief Executive Brian Moynihan bought himself some breathing room as the bank agreed to sell more than $8 billion of China Construction Bank stock, its second multibillion-dollar deal in a week.
