What to watch for today
The White House lays the groundwork for an attack on Syria. US secretary of state John Kerry and defense secretary Chuck Hagel will testify before the Senate foreign relations committee, as part of the Obama administration’s efforts to garner congressional support for military intervention. Meanwhile UN secretary general Ban Ki-moon will brief the 10 non-permanent members of the security council on what weapons inspectors found in Syria.
South Africa’s gold miners go on strike. The National Union of Mineworkers, which represents about two-thirds of more than 120,000 unionized gold miners, is demanding wage hikes of up to 60%. Just last year a series of strikes at a platinum mine ended with the deaths of over 50 people.
US factories sputter. Weakness in domestic activity may have pulled down the ISM manufacturing index to 54 in August. That’s down from a two-year high in July, though still healthy (anything above 50 signals expansion). Construction spending is expected to have picked up in July.
Australia’s central bank in wait-and-watch mode. The bank is expected to leave its benchmark cash rate unchanged at a record low of 2.5%. Economists expect it to wait until after a general election on September 7 before making any new policy moves.
While you were sleeping
Microsoft bought most of Nokia. Microsoft is paying 5.4 billion euros ($7.2 billion) to buy “substantially all” of Nokia’s devices and services units, including access to the struggling Finnish company’s patents. The deal will affect 32,000 Nokia workers, and be funded by Microsoft’s overseas cash reserves.
Vodafone and Verizon finally sealed the deal. After years of on-and-off negotiations, Verizon will buy out Vodafone’s 45% stake in its US wireless business for a total of $130 billion in cash, stock and other transactions. The UK firm will return 71% of the proceeds, or $84 billion, to shareholders, and use $20 billion to pay down debt. It will also cleverly avoid taxes on its windfall.
The US reportedly spied on the presidents of Brazil and Mexico. The National Security Agency tapped emails, phone calls and text messages of Brazil’s Dilma Rousseff and Mexico’s Enrique Peña Nieto, according to Brazilian TV station Globo, citing documents leaked by former NSA contractor Edward Snowden to journalist Glenn Greenwald.
Data from China and Australia. Non-manufacturing activity slowed in China in August, according to the official index, down to 53.9, from 54.1. A result above 50 indicates expansion, and a higher number shows faster growth. In Australia, July’s retail sales grew less than predicted at 0.1%.
China sacked a senior official for graft. Jiang Jiemin was removed from his position as the head of China’s state assets regulator, according to state media, two days after it was announced that he was being investigated for corruption. China’s ongoing spate of corruption probes appears to have caused a scramble among foreign companies to hire lawyers and ensure they are complying with the law.
Quartz obsession interlude
Roberto A. Ferdman on how Brazil’s former richest man, Eike Batista, lost 97% of his fortune in less than two years. “Most of that is due to the struggles of OGX, the biggest of Batista’s companies. In July the company announced its plans to shutter two of its most productive wells. Last week, a run of more bad news caused the stock to lose 63% of its market value, including a whopping 40% drop on Friday alone. And its financial woes are threatening its very existence. This past June, OGX reported nearly $5 billion in debt and a net loss of over $2 billion during the second quarter. If the company defaults on its heaping pile of debt, it would mark the largest such default in Latin American history, according to Forbes.” Read more here.
Matters of debate
France is run for the benefit of the old. The ‘ancien regime’ social model is a scam for the baby boomers to cling to advantages (paywall).
The common ground for Obama and Putin is offshore taxes. They’ll spend the G20 trying to avoid each other but should be talking about tax avoidance.
Not every child can be a star. Giving children rewards just for participating lowers intrinsic motivation levels.
It’s foolish to fight currency speculators. India’s proposal for emerging nations to jointly intervene in offshore foreign exchange markets is unrealistic.
Dad was the bungee jumper in the family. A British study found young men are less likely than their fathers to do adventurous things like rock climbing because they aren’t as fit and healthy.
US drug agents have access to call records dating back to 1987. The data trove is larger than even the NSA’s, and it’s all thanks to a partnership with AT&T.
The man who smells storms. A 64-year-old with Parkinson’s Disease experiences smelly hallucinations in the lead-up to storms.
The skyscraper that melts cars. A tower under construction in London is reflecting light which melted parts of a Jaguar parked across the street.
The sandwiches that get you drunk. A brewery and chocolatier in Italy have joined hands to invent beer you can spread on your morning toast.