Real Time Economics: The China Shock | Is The Fed Done?


This post is by Greg Ip from Real Time Economics


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This is the web version of the WSJ’s newsletter on the economy. You can sign up for daily delivery here.

Good morning! Greg Ip here, looking at the implications for the world of a slowing Chinese economy, collapsing expectations of further Fed rate increases, and the shutdown’s impact on tax refunds.

IF CHINA SNEEZES, DOES WORLD CATCH COLD?

Bad news keeps seeping out of China. In November, retail sales growth hit a 15 year-low and consumption tax revenue nose-dived. In December, factory activity contracted  for the first time in more than a year. Wednesday, Apple lowered projected revenue because of slumping Chinese sales. Weak Chinese growth didn’t used to matter much to the world because it imported far less than it exported. No longer: In 2017 China accounted for 10% of the world’s imports. A slowdown and bungled devaluation in 2015-16 hit commodity prices and helped hobble U.S. shale investment. Continue reading “Real Time Economics: The China Shock | Is The Fed Done?”

How Student Loans Are Upending U.K.’s Budget Math


This post is by Jason Douglas from Real Time Economics


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U.K. Treasury chief Philip Hammond’s Brexit budgeting has been scrambled by an accounting change.

Britain’s Office for National Statistics ruled Monday that loans to college students should no longer be wholly classified in the public finances as financial assets. That’s because a big chunk never get repaid, usually because graduates aren’t earning enough to meet an income threshold for making repayments.

Instead, the statistics office said that part of the debt owed by students should be classified as government spending, since under European accounting rules it can’t be called a loan if it won’t be paid back.

The change, due to be implemented in September next year, comes after British lawmakers voiced concern that current procedures flattered the government books. Latest official projections suggest only 38% of the money lent to full-time students and the interest due will be repaid in full, but the current rules mean the government Continue reading “How Student Loans Are Upending U.K.’s Budget Math”

4 Takeaways From Facebook and Twitter’s Make-Nice Congressional Testimony


This post is by Jon Swartz from Tech Trader Daily


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We’ve come to expect the same back-and-forth between the earnest if evasive tech executive and the stern if grandstanding politician.

But there was an apparent thaw in the normally tense narrative pitting Silicon Valley vs. The Beltway that has played out on Capitol Hill a few times the past year.

Add Birmingham To Tech’s Growing List of Hubs


This post is by Jon Swartz from Tech Trader Daily


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Much as Silicon Valley sees itself as the epicenter of high-tech, plenty of technology hubs dot the United States, each with a distinct vertical market that feeds the industry. Charleston, S.C. (aka “Silicon Harbor”), Phoenix (“Silicon Desert”), and a wide swath of the Midwest (“Silicon Prarie”) are testaments to regions that have produced significant companies while largely avoiding the suffocating cost-of-living, traffic snarls, and hyper-competitiveness that dog Silicon Valley, Seattle, New York, and Austin tech workers.