"Obama Calling for One Year Extension to Bush Tax Cuts" and other top headlines investors should pay attention to today.
Obama Calling for One Year Extension to Bush Tax Cuts
President Obama is planning to announce a call for a one-year extension to the Bush-era tax cuts for people making less than $250,000 today, according to the New York Times. White house officials feel that this move would ease anxiety over the “fiscal cliff”, which is the combination of tax increases and automatic spending cuts that are scheduled to begin at the end of 2012. That combination of events could be harmful to an already sensitive economy.
Flash Flood kills over 170 in Russia
A terrible rainstorm in Russia on Saturday set off floods that killed more than 170 people, as reported by the New York Times. This storm was one of the worst weather related disasters in Russia’s recent history and poured about 11 inches of rain on the Black Sea coast. President Vladimir V. Putin declared a national day of mourning and is promising financial compensation for the victims.
Consumer Prices Drop in China
Prices are falling in China, according to government data released on Monday, as the demand for goods being produced is not met with the same demand from Chinese households and businesses. Consumer prices dropped .6 percent in June compared with May, the largest month-to-month drop in two years, as reported by the New York Times. This figure was still up 2.2 percent from a year ago but only because prices rose quickly through January before starting this dramatic decline. Producer prices, measured at the factory gate, were down 2.1 percent in June compared to a year earlier, and down .7 percent in June compared to May.
Egypt’s New President Challenging Supreme Constitutional Court Ruling
Egypt’s new president, Mohamed Mursi, decreed yesterday that the parliament dominated by his Islamist party would reconvene, after the generals dissolved this assembly in line with a court order, according to Reuters. The military has been running Egypt since Mubarak was ousted last year but the army put some controls on the presidency and gave itself legislative powers prior to handing over the controls to the elected president. This move comes a little more than a week in office for Mursi, and highlights the struggle likely to define his term in office, and creates a new legal question over whether he can overrule a decision by the Supreme Constitutional Court to dissolve parliament.
Brussels Wading into Libor Scandal
Brussels is getting involved in the interest rate-rigging scandal that is rocking London right now, according to the Financial Times. Michel Barnier, the EU commissioner overseeing financial services, will close potential loopholes and criminal sanctions that deal with indices such as Libor and Euribor. His intervention comes on the heels of the resignation of Bob Diamond from Barclays. This effort is likely to work along with a similar UK probe, but there may be differences of opinion of whether to regulate some or all the indices. Libor was set up on the 1980s as a means of providing an average of estimates more exactly because previously there was no easy way to calculate a market-based rate for unsecured interbank lending.
Do You Want Fries With That at the Olympics?
McDonald’s sponsorship of the Olympics is being called into question by top olympic officials, due to the rising global concern over obesity, according to the Financial Times. McDonalds has backed the games for 36 years and in January signed up as a sponsor for another eight years. The International Olympic Committee president, Jacques Rogge stated that the decision to renew McDonald’s sponsorship “was not an easy decision”, but pointed to the healthier meal options as evidence of McDonald’s taking public health concerns seriously. McDonald’s has 4 restaurants in London’s Olympic Park, including its biggest in the world, with seating for 1,500 customers.