Good News, the Economy is Booming!

The news does often seem to be negative. But as Stephen Pinker, a Daily Pnut reader, writes the world has gotten a lot better over the past few centuries. Is the news negative because reporters don’t cover good news because good news is what should be expected? Or is bad news covered because that’s what sells, as bad news gets eyeballs and clicks? We think it’s a bit nuanced: reporters and readers are naturally drawn to bad news because humans are loss averse (as behavioral scientists have confirmed).

We mention all of this because readers occasionally write to us saying we are too depressing. And for that reason, today’s edition is focused on the fair to sunny economic global conditions.

“The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little.” – Franklin D. Roosevelt

“It’s a recession when your neighbor loses his job; it’s a depression when you lose your own.” – Harry Truman

Strongest in the World – America’s Booming Economy: America’s economy is booming, with the lowest unemployment rate in decades and more job openings than ever before. With this comes an unexpected, but welcomed surprise – a decline in the number of people seeking Social Security disability benefits. Below 1.5 million applicants were recorded during 2017, the lowest in almost two decades. Economists also believe that the numbers will continue dropping due to the strong economy. A stronger economy opens up more “low-skill jobs,” which do not require heavy manual labor and so people with physical handicaps can find more job opportunities.

The Trump tax cuts may have been successful in growing the economy, but they may not be the only reason for Americans splurging their hearts out. Everybody loves the good old holiday traditions, where Black Friday riots and Christmas sales leave shopping centers barren, but once the wallets empty, there is normally a three to four month period through spring where everyone’s eating Cup Noodles and saving up cash. This year, this effect may have been much more defined, as seen by shopping trends through the first half of the year. The economy is stronger than ever with unemployment rates at an all-time low. The rate of inflation, however, is the highest its been for quite some time, and with higher prices comes more spending, which is another factor leading to the “high economic growth.”

The United States economy is very strong at the moment, but economists do not believe that it will accelerate again anytime soon. They saw moderate growth during the month of May, but believe that the summer will most likely not yield a great change. Through June, the rate of growth has actually slowed down compared to what it was in months prior. Even at a slower pace, the economy is predicted to continue at a solid pace, and the second quarter of the year will end with a growth of 3.7%.

Trump’s Trump Card: President Trump has aggressively attacked foreign markets with tariffs through his presidency, and his next target is almost all of China’s imports. With economists and investors worried about the impending trade war, Trump has revealed his ace in the hole – America’s strong, solid economy. Globally, countries are seeing their economic growth slowing down, but America is predicting a possible three percent net growth by the end of the year, which has not been seen in over a decade. This gives Trump leverage over China, but economists have warned that the retaliation tariffs may cause troubles in the long-term.

With the pressure from the Trump administration as well as Beijing, China’s investments in the United States has dropped over ninety percent. As it stands, China only spends around 1.8 billion dollars in US investments, which is mostly due to political pressures created by Trump’s tariff threats and Beijing’s retaliation. China has also set limitations on foreign assets, which has caused all deals involving more than two billion dollars to fall through over the past five months. With looming tariffs, it is unsure how Sino-US trade relations and investments will continue to play out.

 Memes may be the root of all evil – to Facebook at least. Facebook has announced upgrades to their fact-checking system which would look over videos and photos in addition to written posts. These fact-checks would check for authenticity and context, and allow Facebook to take action against posts deemed “fake news.” (Techcrunch)

– South Sudan’s two warring leaders met to attempt peace talks, though spokesmen say that the meeting was cordial and that no meaningful dialogue took place yet. Fighting has been constant since December 2013, and with South Sudan in shambles, negotiations may be the only hope for a possible tomorrow. (NYT)

– State funds turned into personal funds for the wife of Israeli Prime Minister Benjamin Netanyahu, who spent one hundred thousand dollars of state money on meals. She looks toward a court hearing and possibly up to eight years in prison if the charges of fraud and breach of trust are found true. (CNN)

– President Trump continues to push for a meeting with Vladimir Putin, as he sends his national security advisor to Moscow. John Bolton is in the works of possibly planning a stop in Russia for the president after his tour through London and Rome.Russian officials have not confirmed the possibilities of a meeting, but Trump remains optimistic. (NYT)

– White House advisor Jared Kushner has been working to assist Middle Eastern countries in coming to peace agreements, and his latest stop was Egypt. Meeting with Egyptian President Abdel Fattah Al Sisi, Kushner hopes to open new relations between Egypt and the United States  (Reuters)

Erdogan’s Project-mania: Turkey’s President Tayyip Erdogan looks for re-election in the upcoming national election, and one of the biggest driving forces in his campaign is his announcement of a new megaproject. Not new to the scene of large-scale projects, Erdogan has created everything from bridges to mosques to airports, and his newest project looks to awe the masses once again. “The Istanbul Canal” would bisect the country and create a Turkish-controlled trade route which would leave a legacy for not only the country but the president as well. The people may be tiring of Erdogan’s many large-scale projects, however, and this upcoming election will see the split between those who view him as a visionary and those who believe it is all in the name of politics, empire building, and building a political brand. (NYT)

– The United States Supreme Court has knocked down laws which have stopped states from taxing out-of-state transactions. This means one thing, and one thing only – more expensive online shopping. It may be time for another tea in the harbor situation, as both consumers and retailers are affected by this ruling – retailers must now account for the various taxation rates in all fifty states if they wish to ship out products, and consumers will face the heavy hand of higher prices.

– The Department of Health and Human Services has asked the Pentagon to prepare housing for thousands of immigrant families on military bases. This is following President Trump’s executive order to only detain illegal immigrants instead of separating families. There is much left to be discussed by White House and Pentagon officials, as many ponder the possibility of such large-scale housing.

–“Watching a species vanish in real time.” The Vaquitas may be living their final days as a species on this blue planet. (Pacific Standard)

–The President’s Shadow: The Story of Donald Trump Junior. (GQ)

–Johnny Depp’s tragic fall from stardom, and his journey through empty bank accounts and lawsuits. (Rolling Stone)

–Richard Rhode’s nonfiction “Energy A Human History” details the history of how Earth has come to this point of energy consumption through the years. Learn all about the innovations and thinking behind the transformation from coal fires to solar panels. (NYT)

–Shadow lobbyists – the most powerful group in America? (NYT)

-Days after a scandal was revealed, Commerce Secretary Wilbur L. Ross Jr. shorted stock in a Russian shipping firm. Valued between one hundred and two hundred fifty thousand dollars, the wealthy investor made the best out of the situation by trying to extort money before the articles were released. (NYT)

-“Our era of relentless social media and soundbites has caused us to lose sight of the past, and future.” (Guardian)

-“All of humanity’s problems stem from man’s inability to sit quietly in a room alone.” In a world so connected to each other, people have lost their connection to themselves. (Quartz)

-Students in China must perform well on national tests to move into top high schools and college programs. Tutoring is in high demand, and TAL has taken full advantage of that. (Bloomberg)

LAST MORSELS

“Everyday is a bank account, and time is our currency. No one is rich, no one is poor, we’ve got 24 hours each.” – Christopher Rice

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