What to watch for today
US jobs nudge upwards. The first official estimate of unemployment in the final month of 2012 will be released by the Bureau of Labor Statistics; economists expect a moderate increase of 140,000 net jobs. Strong performance might be a nice capstone for the past year, but the economy is still wobbly and could be dented by continued spending cuts and political wrangling post-fiscal-cliff.
All you ever wanted to know about global services. In Europe, India and the United States, surveys will offer a snapshot of recent economic activity in the increasingly important non-industrial sector, building on positive news from China, where a surge in activity is boosting growth.
Brazilian economists expect industry to shrink. Today the country’s government will release statistics on industrial production in Nov. 2012; with forecasters calling the downturn, speculators expecting more government stimulus drove down interest-rate swaps.
An Australian heatwave. The country’s meteorologists expect record temperatures across the country, including 41ºC in Melbourne.
While you were sleeping
Wegelin to close. Wegelin & Co, Switzerland’s oldest private bank, is to cease operations after pleading guilty in a New York federal court to helping Americans evade taxes on at least $1.2 billion for nearly a decade. It agreed to pay $57.8 million in restitution and fines. The bank, founded in 1741, had previously vowed to resist the US charges.
Boehner re-elected US House speaker. Republican John Boehner narrowly won re-election after 12 members of his party declined to support him in the aftermath of this week’s compromise tax deal. He received 220 votes to 192 for former Democratic speaker Nancy Pelosi and needed 214 to win. His tally was the lowest in 14 years for a winning speaker.
India getting tax ideas from the US? Chakravarthy Rangarajan, chairman of the Indian prime minister’s economic advisory council, said his government should look at raising the income tax rate of 30% on the highest earners and taxing dividends as it works to narrow its budget deficit.
Transocean will pay $1.4 billion in damages for Gulf of Mexico oil spill. The owner of the Deepwater Horizon rig, where an explosion in 2010 killed 11 people and led to a well blowout that caused widespread environmental damage, has reached a settlement with the US Department of Justice that will end civil and criminal inquiries into the incident. BP, which leased the rig for its Macondo well, agreed in November to pay $4.5 billion in fines.
Settling anti-trust probe, Google finds an unexpected ally. Google’s long-awaited settlement with the US Federal Trade Commission (FTC) was just released, and it’s mostly as expected: Google avoids an antitrust suit and patent regulation by making some changes to its business practices. But in a somewhat unexpected twist, the FTC offered a full-throated defense of Google’s practice of promoting its own services over competitors like Yelp on certain search results pages, saying the practice benefits consumers.
Meet the new US Congress, again. It’s basically the same leadership, but we hope a newly inaugurated Congress with slightly more Democrats and slightly more discord in the House Republican caucus can do a better job resolving the next American fiscal deadline. The new intake also includes Congress’s first-ever Buddhist, first-ever fluent Chinese speaker, and, extraordinarily, first member ever to register her religious affiliation as “none.” A vote on reforming the Senate filibuster, a procedural tool used by opposition parties to block action on legislation, has been pushed back to later in the month.
Is the Fed getting anxious about easing? The US Federal Reserve Bank released the minutes of its latest meeting, held on Dec. 11, 2012, where members fretted about the state of the economy in 2013 and how best to support it. Some of the Fed’s policymakers seem to be getting uneasy about prolonged quantitative easing, argues Quartz’s Simone Foxman—or maybe that’s just what they’d like you to think.
Quartz obsession interlude
Tim Fernholz on how multinational CEOs adroitly navigated the fiscal cliff to their advantage: “Major business leaders joined the White House in media events to pressure Congress to raise income taxes and make a fiscal cliff deal in search of corporate tax reform that would make it easier for multinational corporations to move money around. They got two major elements of that in the extenders. A provision allows US companies operating overseas to convert “passive” profits like interest payments and rents into lower-tax “active” investment vehicles, largely benefitting financial services companies or industrials, like GE, with major financial units. Another provision allows tech and pharmaceutical companies to move intellectual property to subsidiaries in low-taxed or no-tax countries. These are the kinds of rules that allow companies like Pfizer and Google to pay low taxes, and recently attracted public censure for Starbucks in the United Kingdom.” Read more here.
Matters of debate
Should the central bank be a central planner? What the Fed really needs is a US sovereign wealth fund.
Is al Jazeera a news network? Thus asks Elliott Abrams, a former Middle East policy supremo in the Bush White House, who argues the company fails to alert viewers by its name or on its web site that it is controlled by Qatar’s government.
The missed opportunity of Les Mis. At a time when revolution is in the air in the Middle East, the movie could have returned to the novel’s balance between revolution and religion as vehicles for progress, rather than taking a cynical view on revolution.
Do professors even need universities anymore? Freelance academics might be the future of education.
America’s banks are black boxes. What kind of regulation could make these behemoths comprehensible to average customer or investor?
The case for currency wars. Just not trade wars. You can tell the difference, right?
More resilient screens. Corning, the glassware company whose “Gorilla Glass” is in more than 1 billion smartphones, tablets, televisions and notebook computers, next week will unveil a new type of glass that it says will be 50% more resistant to breaks and 40% less prone to visible scratches.
Smaug the Dragon is a monetary phenomenon. A macroeconomic analysis of The Hobbit.
Martian rock with water in the Sahara. Scientists are studying a rock bought from a Moroccan meteorite dealer that, unlike previous meteorite fragments that have come to Earth from the red planet, appears to have the relatively high water content matching rocks examined on Mars by NASA rovers.
A new ground-based location system could make GPS work indoors. The military is excited, and so are robots.
A French ISP is automatically blocking online ads. The tech update boggled consumer minds, but could inspire ire among content creators.