Good morning, Quartz readers!
What to watch for today
Obama hears from the 1% on how much tax they want to pay. The US president will meet with chief executives from a dozen top American companies including General Electric, Honeywell, and Wal-Mart, as part of his negotiations on averting the upcoming “fiscal cliff”. Some have noted the conspicuous absence of financiers from the group, after Wall Street’s big bet on the failed Romney campaign. Expect more clues as to the line the administration will take on taxes and spending when Obama holds a press conference today. Treasury Secretary Tim Geithner has hinted Obama will not be soft on the rich, saying higher taxes for them are inevitable.
Glum faces at Goldman Sachs as fewer maker partner. The Vampire Squid is set to announce new partners today. But reports claim that only around 70 bankers will make partner this year, a smaller crowd of new Wall Street overlords than in previous years. Surprisingly, one person tipped to join the partnership is the new public relations chief, Jake Siewert. Perhaps he has invented magic dust to sprinkle over reporters’ heads that will immediately make them stop referring to that Rolling Stone article or anything to do with Muppets.
Angry protests across Europe. In a co-ordinated wave of strikes, industrial action against austerity measures is building up across Portugal, Italy, Greece and Spain. Spanish workers are staging their second general strike of the year. One of Portugal’s two biggest labor unions has also called a strike. And partial walkouts are planned in Italy and Greece. French workers may join in too. Union leaders argue that austerity programs have increased the wealth gap in European countries without solving debt crises.
Greece buying time sends stocks on a relief rally. Asian stock markets rose today after Greece’s successful bond auction Tuesday that will help it avoid missing a debt repayment due at the end of this week. But the bond auction has only allowed Greece and its creditors to kick the can down the road. They still face a tough choice – lose money now, or later.
While you were sleeping
Euro zone countries released lousy industrial data. Industrial production fell 2.5% in the euro area (17 countries) and 2.3% across the European Union (27 countries) in September from August—the biggest fall in more than three years.The nasty numbers tell us that European companies are struggling to maintain sales and profits. While Germany, Europe’s former powerhouse, is getting dragged down (paywall) by credit crunches in neighboring countries.
A small group of elite Chinese politicians started choosing the country’s new leaders. The 18th congress of China’s Communist Party concluded today. Around 2,200 delegates spent this morning choosing who gets to join the Central Committee. That is a panel of a few hundred people who will in turn select the seven members of the nation’s innermost ring of power, the Politburo Standing Committee. That announcement is due Thursday, but state-owned media have started to release clues. Xi Jinping and Li Keqiang—already hotly tipped—look likely to become party leader and deputy, respectively. Other than the excitement over the selection of new bosses, the congress has been heavy on rhetoric, some of it comical, such as Hu Jintao lambasting the corruption he presided over.
Sandy claimed Long Island Power Authority CEO’s scalp. Michael Hervey, the embattled chief executive of the Long Island Power Authority, has resigned. He stepped down on the same day that New York Governor Andrew Cuomo launched an investigation by a special commission into the state’s utilities and their response to the super-storm. The New York Times said of the Long Island Power Authority that “deep-rooted problems at the authority have hobbled its response, causing hardship for hundreds of thousands of its customers.”
Singapore casino operators found the house does not always win. Gaming revenues in the South East Asian city, which bet big on gambling by building a huge casino and entertainment resort on Sentosa Island in 2010, are falling. Analysts say the novelty is wearing off for Singapore’s public, while the global economic slowdown is forcing high-stakes VIP gamblers to spend less.
Quartz obsession interlude
Matt Phillips on how the current fiscal cliff debate is only the latest chapter in a US debt saga going back over 200 years: ”The US was born in debt. The earliest full reckoning of US national debt was compiled by Alexander Hamilton, the first US Treasury Secretary… The analysis dates to 1790 and puts the newborn US at around a 30% debt-to-GDP ratio, with the debt a bit higher than $75 million… All in, the US owed about $11.7 million to foreigners, mostly to Dutch bankers and the French government, and about $42 million to domestic creditors. The states also had a ton of debt (about $25 million, Hamilton reckoned), which the Federal Government assumed—take a hint, euro zone!—in 1790.” Read more here.
Matters of debate
German officials should stop worrying about the US fiscal crisis and start worrying about the fiscal crisis in their own backyard.
Fiscal Cliff spending cuts are “going to kneecap“ the US military and bludgeon defense spending. In yet more cliff-inspired mixed metaphor, a Defense Department official has told the Seattle Times he is preparing for “fiscal castration.”
After the US election, it’s only a matter of time before a schism emerges in the Republican party between extremists and “pragmatic conservative problem solvers.“
China’s next president has a much tougher job than President Obama. Compared with Communist-Party-style collective decision-making, facing down the Republicans in Congress is apparently a cakewalk.
Hong Kong’s “indentured” Indonesian and Filipino maids are big business for loan sharks. Bloomberg questions why companies such as 7-Eleven help the high-interest lenders do business.
The amazing story of how an aristocratic French family was swindled. Thierry Tilly was sentenced to eight years in prison on Tuesday, after using his Rasputin-like attachment to an aristocratic French family to convince 11 people—age 16 to 89—that their lives were in danger. “The family was in hiding for nearly a decade before two of the adult children realized Tilly wasn’t what he appeared.”
Big Brothers are watching everyone, everywhere. Data from Google show government data requests are rising sharply all over the world.
British police want to know how somebody stole the keys to the Tower of London, where the crown jewels are kept.
In Memphis, Santa Claus is fighting for a refund after officials made him buy a business license.
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