News Summary: February 8-12

News for the Week of 2/8/2016 – 2/12/2016

by David Abuaf Investment Manager, RJFS

 

Government / Political / Economic

1.     Refugee camps are burgeoning along the French and Belgian coasts as migrants seek different routes to reach the UK.

2.     North Korea’s launch of a long-range rocket triggered condemnation and the threat of tougher sanctions on Pyongyang.

3.     Shiite fighters backed by Russian airstrikes are advancing toward Aleppo, helping Syria’s regime turn the tide against rebels.

4.     Canada said it will end airstrikes against Islamic State but boost the number of military trainers in Iraq.

5.     NATO is developing a new strategy to face the kind of unconventional tactics the West says Russia has used in Crimea and Ukraine.

6.     The White House is likely to ask Congress for about $1.8B in emergency funding to combat the Zika virus.

7.     The administration plans to boost the government’s power to probe colleges accused of deceptive tactics.

8.     Trump won the NH primary by a decisive margin while the rest of the GOP field was left as murky as ever. Sanders also soundly defeated Clinton by a historic 22-point-margin, unprecedented in the state among Democrats.

9.     SCOTUS temporarily blocked the Obama administration’s initiative to limit carbon emissions from power plants.

10.  Obama unveiled a final budget proposal that lays out a policy agenda for apotential future Democratic successor…because a GOP successor wouldn’t follow any of it.

11.  Saudi Arabia pressed its offer to send troops to fight Islamic State in Syria, while Turkey asked for NATO ships to help stem the flow of refugees into Europe.

12.  The mayor of Flint, Michigan laid out a plan to replace the lead pipes that contaminated city water.

13.  Talk about bad timing Chris! Chris Christie is suspending his campaign. I believe that had he run in 2012, it would have been a close race.

·       Carly Fiorina is also suspending her campaign.

14.  World powers agreed to reach a cease-fire in Syria in one week.

·       Syrian rebels fighting to overthrow Assad say they are shifting to guerilla warfare as their territorial losses mount.

15.  The final occupiers of the wildlife refuge in Oregon surrendered peacefully.

16.  NATO is sending ships to the Aegean Sea in a bid to crack down on people-smuggling and stem the influx of migrants into Europe.

 

General Markets / Economic

1.     China’s foreign-exchange reserves fell to the lowest level in over three years, raising questions about Beijing’s defense of the yuan.

2.     Pharmacies that market pain creams are being probed for health fraud, with a veterans’ insurance program a possible victim.

3.     The yen’s recent surge amid a global flight to safety could unravel their efforts to reignite growth.

·       Japan has had stagnant growth for a while. However, the benefit, for every country, of a lower currency means that they can/should have higher exports, helping to spur on GDP growth. However, with people now clamoring to have more yen, a typically safe currency, the ability for foreigners to buy Japanese goods is reduced because those goods are now more expensive. Fortunately, in the US, while our currency is also surging, and has been so for a number of years as the global economy has stagnated, we have already had positive and growing GDP growth, which is good. However, not all strong economies are as fortunate – see Japan.

 

Company News

1.     Big firms are reining in capital spending and cutting jobs amid sluggish industrial demand and mixed signals from consumers.

2.     The drug industry is ramping up a new ad campaign aimed at policy makers as it lobbies against efforts to curb prescription costs.

3.     Ford plans to build a new assembly plant in Mexico and sharply increase factory output from Mexico.

4.     Walgreens threatened to end its relationship with Theranos unless the blood-testing firm quickly fixes problems found at a California lab.

5.     Amid government pressure, Facebook is more aggressively policing material it views as supporting terrorism.

 

Interesting Stories

1.     Tennessee congressman Steve Cohen is proposing that the US government regulate the size of airline seats.

2.     Police in London and the Netherlands say that they’re considering the use of Eagles to intercept drones.

3.     A Florida man was arrested in last Monday for assault with a deadly weapon when he decided to toss a live alligator through the drive-through of a Wendy’s.

4.     A team of London scientists accidentally discovered that the single-celled algae known as “pond-slime”, focus light like a lens, with their whole body, acting like a microscopic eyeball.

5.     Scientists said they directly detected gravitational waves for the first time, verifying an unproven portion of Einstein’s relativity theory. It was from two black holes merging that happened roughly 1.6 billion years ago.