What to watch for today
Japan’s economy is picking up steam. Second quarter GDP growth is expected to be revised upwards to 3.6% from a preliminary reading of 2.6%, driven by robust capital spending. The revision could strengthen the case for the proposed sales tax hike in 2014.
China’s inflation should stay benign. Consumer price inflation is likely to have dipped to 2.6% in August from the July’s 2.7% reading, thanks to falling food prices. Producer prices may have declined even more sharply to 1.8% in August, from the 2.3% seen in the previous month.
Barack Obama’s charm offensive on Syria. The US president will tape six TV interviews as he attempts to persuade members of Congress to back the strike against the al-Assad regime, and sway public opinion in favor of intervention. The Syrian president denied that he was behind the Aug. 21 attack and said there was no conclusive evidence that chemical weapons were used.
Norwegians may elect a new leader. Conservative leader Erna Solberg, who has promised to cut taxes and improve health care, is forecasted to emerge as the next prime minister. But the new government is unlikely to address the growing property bubble in the Scandinavian nation.
Over the weekend
The 2020 Olympics goes to…Tokyo. The Japanese capital defeated Istanbul and Madrid after prime minister Shinzo Abe gave an emphatic assurance of safety regarding the radiation fears from the country’s 2011 nuclear disaster. But winning the bid will worsen Japan’s public debt, which hovers around 230% of GDP.
Australia’s opposition party cruised to victory. The Liberal-National coalition ended the Labor Party’s six-year rule by winning 88 of the 150 parliament seats. New prime minister Tony Abbott pledged to cut taxes and take swift action to boost the economy hurt by the slowdown in the mining sector.
China’s biggest trade surplus since December. Exports grew at an annualized pace of 7.2% in August, while imports rose at a less-than-estimated 7%, pushing the surplus to $28 billion.
Alibaba may shift its IPO to New York. China’s biggest e-commerce company may move its proposed $60 billion issue from Hong Kong if founder Jack Ma and top executives, who own just over a 10% stake, cannot nominate a majority of board directors (paywall). They continue to push for dual-class shares, which would help them maintain control, but could be rejected by Hong Kong’s regulators.
$6 billion luxury retail deal almost done. Ares Management and the Canada Pension Plan Investment Board are reportedly close to buying out (paywall) luxury department-store chain, Neiman Marcus, from its current owners TPG and Warburg Pincus.
Even smartphone users’ data is not safe from the NSA. The US spy agency can access contact lists, SMS traffic, notes and location information from iPhones, BlackBerrys, and Android-based phones, according to German news weekly Der Spiegel.
Quartz obsession interlude
Gwynn Guilford on why real estate in Beijing is more expensive than Manhattan. “But price rises could be due more to speculation than to a dearth of supply. Especially in big cities, apartments are often seen as investment vehicles more than as homesteads. For instance, even though swanky high-rises are getting more expensive in Beijing, their sales in smaller cities are flagging, suggesting that genuine demand is weak. As Bank of America-Merrill Lynch’s China strategy team noted in March, “China is building too many housing units too fast.” Per capita housing stock, they note, hit 35 sq m in 2011, and is rising by 1.2 sq m a year, putting China in the same league as many wealthy countries.” Read more here.
Matters of debate
The euro zone is sinking the emerging economies. An austerity-driven demand slowdown in Europe is the real reason why emerging markets’ current accounts are in dire straits.
The Syria vote is a lose-lose for Barack Obama. A failure will make his presidency appear impotent, but offering concessions to Republicans to ensure a victory could derail his agenda in Congress.
Yahoo’s new logo makes it look like a cosmetics brand. The resemblance creates a disconnect not only between Yahoo’s past and its intended future, but also between Yahoo and its digital peers.
A hands-off boss can kill careers. The absence of pressure can encourage status quo and neutralize people’s desire to take action.
Surprising discoveries
E-cigarettes could be the cure. First-of-its-kind research shows that electronic cigarettes are as effective as nicotine patches in helping smokers quit.
Britain’s Marie Antoinette moment. The UK may soon classify one million of the lowest paid employees as “not working enough,” and force them to earn more, or face a cut in benefits.
New twist in the gun control debate. The US state Iowa, is granting gun permits to people who are legally blind.
How to catch a liar. A study shows that people who are lying in digital messages take longer to respond.
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