1 Risk rises as junk bonds boom (The New York Times) Money market funds pay next to nothing. Interest rates on US Treasuries are dismal. The volatile stock market has been dead money for more than a decade. The market for junk bonds, risky corporate debt that pays high interest rates, is red hot. Such debt, also known as high-yield bonds, has returned 10.2% year-to-date, according to a JPMorgan high-yield index. Junk bond funds are on a pace to take in a record amount of money this year. Companies with less than stellar credit are issuing hundreds of billions of dollars of bonds.
Fueling this frenzy are investors of all stripes — including individuals, mutual funds and state pensions — who are desperate for returns in their bond portfolios and willing to take more risk to get them. Demand is insatiable, even as analysts warn that the market has become overheated and is ripe for a fall. "In a yield-starved world, high-yield bonds are right now the only game in town," said Les Levi, a managing director at the investment bank North Sea Partners. "The market is giddy." But on Wall Street — as the old saying goes — somewhere, someone is making money. And these days, that somewhere is junk bonds.
2 Amidst global crisis, LatAm thrives (The Guardian) The cash machines in Santiago are running out of money, but it is not a run on the banks; shoppers in Chile are simply spending peso notes faster than the automated tellers can provide them. New skyscrapers are rising up in Bogotá to create the office and retail space needed by a growing economy. Mexico – the new darling of foreign investors – is outstripping GDP forecasts. Brazil, which overtook the UK as the world's sixth biggest economy last year, has just announced a $66bn stimulus plan in addition to the money it will splash out in preparation for the 2014 World Cup and the Olympics in 2016.
The economic mood music in Latin America for most of this year could hardly have been more of a contrast from that of the EU, mired in financial crisis, depressed by austerity, and dipping back into recession. Latin America is now being retuned, as most nations expect slower but still solid growth, and some prepare to tap extensive reserves to spend their way out of a global downturn.
Their ability to withstand the coming storm will have long-term implications for perceptions of a region that was until recently a byword for financial turbulence, irresponsible spending and whimsical policies. Recently, many of the region's governments have been praised by the UN, IMF and World Bank for building strong reserves and maintaining generally low levels of public debt.
3 China growth 'under pressure' (BBC) China's Premier Wen Jiabao has warned that the country's economy is under pressure and that it is facing problems that may last for some time. However, he said that Beijing will be able to meet its growth target, despite those issues. He said that easing inflation had given more room to policymakers to introduce measures to spur growth. China has been hurt by slowing global demand for its exports and lacklustre growth in domestic consumption.
Premier Wen's comments comes amid worries of a sharp slowdown in China's economy, the world's second-largest. Its gross domestic product grew at an annual rate of 7.6% during the April-to-June period. While that may be healthy compared to many developed Western economies, it was the slowest pace of expansion for China in three years.
4 Rumour makes thousands flee in India (BBC) Thousands of people from India's north-eastern states have fled the southern city of Bangalore amid fears that they are to be the target of attacks.Correspondents say the rumours of attacks may be linked to recent clashes in the north-eastern state of Assam. More than 300,000 people fled after fighting between indigenous Bodo tribes and Muslim settlers in Assam. There has been tension between indigenous groups and Muslim Bengali migrants in Assam for many years.
The main railway station in Bangalore was flooded with migrant workers from north-eastern states after rumours spread on Wednesday.The railways ran special trains to the north-east to cope with the rush, officials said. There are 250,000 people from north east living and working in Bangalore, many of them students. Around 4,000 fled on Wednesday, a senior police officer in the city said. He said that rumours about possible violence were spread by text messages.
5 India at 65, chasing an illusion (Pankaj Mishra in The Times of India) The millstone of an ideology of endless growth - one evolved by small predatory societies, which never took environmental sustainability into account - now hangs around our necks. Unlike the US and Europe in the 19th and 20th century, we lack expandable frontiers, and have no continents to conquer or native populations to subdue. So we assault and dispossess the pre-modern dwellers of our own forests.
The tryst with destiny recedes deeper into the future. And at 65, this most melancholy of anniversaries, we stumble from middle age into early senescence, with the guilty, helpless awareness of having spent the best years of our lives chasing an illusion.
6 Secret to living up to 100 (Sydney Morning Herald) Okinawa, the string of 160 subtropical islands east of Taiwan that constitute Japan's southernmost prefecture, contains more centenarians per head of population than anywhere else. Five times as many Okinawans live to be 100 years old as their compatriots elsewhere in Japan - and Japan has the highest life expectancy of any country.
There are several possible explanations. Okinawans are famously laid-back; the local business uniform of a Hawaiian shirt and slacks is certainly a world away from Tokyo's suited salarymen. Then there's the stress-free nature of the place itself: a subtropical archipelago of coral reefs, warm seas, lush jungles and NapiSan-white beaches. But nutritionists speculate that diet - and how their food is consumed - has much to do with it. Not only are Okinawans thought to be the only culture with a tradition of self-imposed calorie restriction (hara hachi bu), but their traditional diet has few calories to start with.
Pork may be acidic, but it is high in protein and its acidity is neutralised by lashings of mozoku, a local seaweed that is alkaline, calorie-free and constitutes the other staple of the traditional Okinawan diet. These ingredients are complemented by seafood, tofu, vegetables and a traditional intake of grains, salt and sugar that is much lower than in most cultures.
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