News Summary: August 7, 2015

PLEASE NOTE: The stories reported below are for informational purposes only to educate our clients on the weekly news stories; real, funny, educational, and otherwise. The source of most news will stem from the Wall Street Journal (WSJ), Financial Times (FT), Barrons (B), Business Week (BW), and Bloomberg (Bbg). The purpose of this is NOT to solicit any offers to buy or sell stocks, mutual funds, commodities, or other financial assets – merely to report the news. Please call us to discuss any investment questions you may have. Additionally, we will not take sides in any political or religious news that we report, we will only present the objective facts, and perhaps opine on them from a neutral perspective. Finally, the opinions represented are those of David Abuaf, and not necessarily of Forman Investment Services or Raymond James or its affiliates.

A quick list of shortcuts: DoJ (Dep’t of Justice), ECB (European Central Bank), EZ (Euro Zone), EU (European Union), BoE (Bank of England), BoJ (Bank of Japan), example: BoX (Bank of X country), SCOTUS (Supreme Court), Ccy (Currency), WH (White House), HY (high yield – bonds), IG (investment grade – high quality bonds), OECD (Org for Economic Cooperation & Dev), IMF (Int’l Monetary Fund)

Government / Political / Economic

1.     More and more airplane debris, suspected to be linked to Malaysian Air Flight 370, is being found on Réunion Island

a.     The plane debris was confirmed as that of MH370

2.     Obama is set to unveil a rule mandating federal limits on power plant carbon emissions

3.     Gulf Arab states voiced support for the Iran Nuclear deal

4.     Chinese officials say Island-Building has stopped in the disputed South China Sea

5.     Germany’s justice minister fired the country’s top prosecutor over his treason investigation of two bloggers

6.     Obama delivered a detailed defense of the Iran nuclear deal, arguing that it presents Congress with a choice between war and peace

a.     I disagree, there will be no “peace” with the current Iranian political mindset, but there may be a “no war” approach. The two are not exclusive. We were at “peace” with the USSR, yet it was still a war, a cold war!

b.     And of course! Iran has denied UN inspectors access to scientists and military officers to investigate allegations of a covert nuclear-weapons program

7.     The US launched its first airstrike against the Islamic State from an air base in southern Turkey

a.     It seems we never learn from our mistakes or history! I pray this doesn’t come back to hurt us, but I know it will

8.     Interesting stat, according to news polls, even though Trump is leading the GOP race, he’s also leading it amongst voters saying “who they will never vote for” 

General Markets / Economic

1.     Dole and other companies are souring on using Delaware as a corporate tax haven (relatively)

2.     Chinese manufacturing hit a two year low

3.     JP Morgan is easing underwriting criteria for jumbo mortgages as it competes for high-end borrowers. This news is in this section, because I highly doubt this issues is focused just on JPM and we’ll likely hear similar news from other banks in the next 3 months

4.     The SEC is set to approve a rule requiring companies to disclose the pay gap between employees and the CEO. And it has been approved

5.     A new accounting rule will force many city and states to disclose the cost of tax breaks used to lure companies

6.     The US trade gap grew 7% in June as imports climbed steadily

7.     3D printer companies are struggling with an uncertain outlook as consumers hold out for what they hope will be better, faster machines

Company News

1.     The Hotel industry is urging the US to reject an Expedia-Orbitz merger, saying the combined firm would control the online booking market

2.     Car makers recalled more vehicles in the first seven months than in any other comparable period except 2014!

3.     The Chinese AirBnB raised $300m in its latest funding round

4.     Bill Ackman has taken a $5.5B stake in Mondelez and will argue the maker of Oreo cookies and Ritz crackers needs to cut costs and grow revenue or sell to a rival like Kraft

5.     The coal miner Alpha Natural resources is expected to file for chapter 11 bankruptcy this week, in a bid to cut its more than $3B debt load

6.     Shire agreed to pay $300m for Foresight, an eye-drug company that makes a treatment for pinkeye

7.     GM is spending $877m to upgrade a truck plant in its hometown of Flint, MI

8.     Sharp is weighing its options for its LCD panel business and plan to quit selling TV sets in the US

9.     Shire made a $30.6B bid for Baxalta – rare disease treatment company

10.  CVS will stop covering Viagra for many of its drug-benefit plan members in favor of Cialis

a.     I bet Eli Lilly (maker of Cialis) will be happy for more than 4 hours. BA-DUM-CHING!

Interesting Stories

1.     In Calgary, they’ve had too much! The crack-down has begun. Citizens have taken arms to tell city hall to fight these evil monstrosities – Dandelions!

2.     I didn’t know all those liberal arts colleges had so much in common with the Olympics. Ultimate Frisbee was formally recognized by the IOC this week!

3.     A London man received council approval to open a women’s museum…instead he opened a museum dedicated to Jack the Ripper murders. I know he only murdered women, but…

4.     HitchBot, a Canadian “artwork and social robotics experiment” that traveled the world safely for the past year, was found beheaded and dismembered in a US city.  Any guesses? I’ll give you a hint, their football fans despise Santa Clause. Yes, the city of brotherly love

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