What to watch for today
EU might agree on its budget for the next seven years. Some 40% of the EU’s €1 trillion ($1.34 trillion) budget goes to “agricultural subsidies, cherished by French farmers.” It’s just one of the things Angela Merkel could be pushing to trim. If leaders don’t reach an agreement, the EU will have to create a new budget once a year, in a process somewhat reminiscent of the US’s ongoing struggles with its own debt limit.
Get a jump on the Chinese New Year. Starting this weekend, 200 million Chinese are expected to travel for the new year, and “for some, this means entire days on standing-room only trains.” Better to get ahead of that rush, if you can—retailers certainly have. Meanwhile, Rio de Janeiro gears up for Carnival.
Shutdown on the US East Coast. A “historic” blizzard, perhaps even “the worst of all time” is likely to make your colleagues in the US North East inaccessible. If power lines go down, effects of the disaster could linger for weeks.
While you were sleeping
Japan had its smallest current-account surplus in 30 years. Coming on the back of a record trade deficit, Japan’s current account—which measures the balance of trade together with investment income and cash transfers—is still in the black, but only just. If it goes into deficit, financing Japan’s punishing load of government debt will become harder.
Wall Street is at war with Apple, and Apple might blink. Hedge fund boss David Einhorn is suing Apple to get the company to return some of its massive hoard of cash to investors, after the stock has taken a beating in recent months. Apple says it’s “evaluating” his proposal. The deeper story here is an ongoing battle between technology companies that don’t like to be told what to do and those on Wall Street who like to remind them that they belong to their shareholders.
Boeing got off the ground. The Federal Aviation Administration, an American regulator, granted Boeing permission to conduct test flights of its beleaguered 787 Dreamliner. Boeing hopes that fresh data on the performance of the temperamental lithium-ion batteries, two of which caught fire within a week of each other grounding the entire fleet, will help it isolate the problem.
Obama’s nominee for CIA director justified drone strikes. John Brennan, “a casting agent’s idea of a spy boss“, told the US Senate that he was aware of harsh interrogation following 9/11 but did nothing to stop it. Questioned about the Obama administration’s liberal use of drone strikes, he defended it as a “last resort“.
LinkedIn had another great quarter. Profits at the social networking site for professionals jumped 66% over the last quarter to $11.5 million, bashing analyst forecasts. LinkedIn boss Jeff Weiner called 2012 a “transformational year” for the company.
Quartz obsession interlude
Why Chinese companies get away with such transparent accounting dodges. “What unites the alleged fraud at Caterpillar’s Chinese subsidiary, Siwei, with the methods described by Gillis are their simplicity. While Enron hid its losses by conducting derivatives transactions with its own off-balance sheet vehicles and Bernard Madoff went to extreme lengths to conceal his Ponzi scheme with a purported “split-strike” trading strategy, corrupt Chinese companies often inflate sales by fabricating deals and inventing false customers.” Read more from Quartz’s Naomi Rovnick.
Matters of debate
France is a financial mess and no alternative to German austerity. France’s nanny state is headed for a sovereign debt crisis.
India needs to greatly increase access to banking. The alternative is allowing its economy to be crippled by gold imports.
Is Asia casting off its dependence on the West? Changes in how much is being shipped where suggest it’s so.
How to make it big in America. Being a second-generation immigrant helps.
Why is S&P the only ratings agency being sued for its role in the financial crisis? Could the US Justice Department be using it as target practice before going after Fitch and Moody’s too?
Elon Musk may have just solved Boeing’s dreamliner problem. The electric-car and private-spaceflight entrepreneur knows a thing or two about batteries, and Boeing seems to following his advice.
Need a boyfriend for Chinese New Year? Rent one. This seems improbable in a country with a sex ratio as skewed as China, but fake boyfriends can be had for as little as $8 an hour.
Peanut allergies are more common than ever in rich countries in the West, but not Israel. The key appears to be ongoing exposure to small amounts of the stuff from infancy.
Climate mystery solved. Why are cities even hotter than climate models predict? It’s the direct heating effects of our enormous use of energy.
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