Gold set for worst month in three years; First oil output cut since 2008; Big Mac creator dies

1 Gold set for worst month in three years (Cecilia Jamasmie in mining.com) Gold prices are on track to make of November the metal’s worst month in over three years as strong US economic data boosted the dollar, rising expectations of an interest-rate increase by the Federal Reserve next month.

Gold for February delivery, the most active contract, was recently down 1.48% at $1,173.20 an ounce on the Comex division of the New York Exchange. Sharp gains in the crude oil market after the OPEC agreed to cut production by about 1.2 million barrels per day, or about 4.5% of current output, did little to help the gold bulls.

A Federal Reserve interest-rate increase next month is now as definite as death and taxes, according to the latest poll of investors. They see the likelihood of a rates hike as 94% certain, according to Fed fund futures tracked by CME. Higher interest rates are typically negative for gold and other precious metals as they don’t pay interest.

Gold has shed nearly 8% this month, the deepest monthly drop since June 2013, hurt by a rally in the US dollar on surging Treasury yields as investors believed President-elect Donald Trump's policies would invoke faster inflation.

http://www.mining.com/gold-set-to-record-its-worst-month-in-three-years/

2 First oil output cut since 2008 (Larry Elliott in The Guardian) The price of oil has surged by 8% after the 14-nation cartel Opec agreed to its first cut in production in eight years. Confounding critics who said the club of oil-producing nations was too riven with political infighting to agree a deal, Opec announced it was trimming output by 1.2m barrels per day (bpd) from 1 January.

The deal is contingent on securing the agreement of non-Opec producers to lower production by 600,000m barrels per day. But the Qatari oil minister, Mohammed bin Saleh al-Sada, said he was confident that the key non-Opec player – Russia – would sign up to a 300,000 bpd cut.

Russia’s oil minister, Alexander Novak, welcomed the Opec move but said his country would only be able to cut production gradually due to “technical issues”. A meeting with non-Opec countries in Moscow on 9 December has been pencilled in.

Brent crude was trading at just over $50 a barrel following the completion of the Opec meeting in Vienna – an increase of almost $4 on the day. Saudi Arabia will bear the brunt of Opec’s production curbs, having agreed to a reduction in output of just under 500,000 bpd. Iraq has agree to a 210,000 bpd cut, followed by the United Arab Emirates (-139,000), Kuwait (-131,000) and Venezuela (-95,000).

Smaller countries are also reducing output, but Iran – which has only recently returned to the global oil market after the lifting of international sanctions – has been allowed to continue raising output. Indonesia has suspended its membership because, as a net importer of oil, it wanted the price of crude to stay as low as possible and declined to cut output.

https://www.theguardian.com/business/2016/nov/30/oil-price-opec-cut-in-output-saudi-arabia-deal-market

3 Big Mac creator dies (San Francisco Chronicle) Michael James "Jim" Delligatti, the McDonald's franchisee who created the Big Mac nearly 50 years ago and saw it become perhaps the best-known fast-food sandwich in the world, died Monday at home in Pittsburgh. Delligatti, who according to his son ate at least one 540-calorie Big Mac a week for decades, was 98.

Delligatti's franchise was based in Uniontown, not far from Pittsburgh, when he invented the chain's signature burger in 1967 after deciding customers wanted a bigger sandwich. Demand exploded as Delligatti's sandwich spread to the rest of his 47 stores in Pennsylvania and was added to the chain's national menu in 1968.

"He was often asked why he named it the Big Mac, and he said because Big Mc sounded too funny," his son Michael Delligatti said.

However, McDonald's in 1985 honored Esther Glickstein Rose with coming up for a name for the burger and presented her with a plaque etched with a likeness of the best-selling sandwich and french fries between the Golden Arches. She was a 21-year-old secretary for the company's advertising department in 1967 when, the story goes, a harried executive dashing to a board meeting asked her for a name nomination.

Jim Delligatti's family disputes that Rose came up with the idea. The company didn't immediately clear up the dispute. Delligatti told The Associated Press in 2006 that McDonald's resisted the idea at first because its simple lineup of hamburgers, cheeseburgers, fries and shakes was selling well.

McDonald's has sold billions of Big Macs since then, in more than 100 countries. When the burger turned 40, McDonald's estimated it was selling 550 million Big Macs a year, or roughly 17 every second. Delligatti received no payment or royalties for coming up with the burger, the company said.

Ann Dugan, a former assistant dean of the University of Pittsburgh's Katz School of Business and an expert on business franchises, said Jim Delligatti's genius was simple: He listened to customers who wanted a bigger burger.

"In franchising, there's always this set playbook and you have to follow it. Jim saw an opportunity to go outside the playbook because he knew the customer," Dugan said. "He persevered and (McDonald's) listened, and the rest is history."

http://www.sfgate.com/news/us/article/Pennsylvania-McDonald-s-franchisee-who-created-10644453.php

Fear of emerging markets submerging in 2017; Envisioning no-fare airlines; Celebration, sorrow and slights on Castro's death

1 Fear of emerging markets submerging in 2017 (Gulf News) The year threatens to end as it began for emerging markets — with losses. After spectacular returns between end-January and October, emerging market stocks and bonds are again in retreat, disappointing investors who had hoped the sector had finally turned a corner after lagging its developed market peers for years.

Money managers who attended last year’s Reuters Global Investment Outlook Summit had correctly called a turn in favour of emerging markets. At this year’s summit, held November 14-19 — just after Donald Trump’s US presidential election victory — the mood was far less buoyant.

In the wake of the election, investors pulled a record $6.4 billion from emerging bond funds tracked by JPMorgan — a full 10 per cent of what had been received year-to-date. Equity funds shed a third of year-to-date inflows, data showed.

Returns for 2016 are still positive. But foreseeing more pain, many summit participants said they had cashed out their emerging market trades. The emerging rally earlier this year had coincided with a 5 per cent fall in the dollar index. Since the election, the greenback’s value has risen 5 per cent to 14-year highs.

But Trump’s election may not be unequivocally negative for the developing world if his infrastructure plans reignite commodity demand and boost US growth. Emerging market debt is another story. Higher US yields don’t just reduce the appeal of emerging bonds, they also make it costlier for governments and companies to roll over maturing debt or raise fresh finance.

http://gulfnews.com/business/money/emerging-markets-may-submerge-again-in-2017-top-funds-fear-1.1935399

2 Envisioning no-fare airlines (Gwyn Topham in The Guardian) Ryanair chief executive Michael O’Leary has outlined his airline’s plans: to cut fares and fly ever more people. That was, he said, “great news for all the bankers and robbers who will not be reducing their charges, and who will all be making out like highwaymen and bandits as they continue to see rising passenger numbers at their airports, rising retail sales and rising restaurant sales. All on the back of the poor stupid Irish who will be carrying all these people at even lower prices.”

Bitter? Very. But after the tirades, O’Leary shared a dream: “I have this vision that in the next five to 10 years fares on Ryanair will be free; in which case the flights will be full, and we will be making our money out of sharing the airport revenues of all the people who will be running through airports, and getting a share of the shopping and the retail revenues.”

Could that dream ever become reality? Certainly, the tills have been flowing freely at Stansted airport, Ryanair’s biggest UK base. The departure lounge, completed a year ago, is testament to the possibilities. The short distance to the departure gates can only be negotiated via a meandering trail through the duty-free. A hard right at Jo Malone takes you straight into the arms of the Jack Daniel’s boutique, before sniffing the air through a chicane of Lancôme and Estée Lauder, into an oxbow bend through the fashion stores.

This retail spending is the prize O’Leary covets. The airports, however, reckon that Ryanair already gets its share. The owner of Stansted, Manchester Airports Group, signed a 10-year deal with Ryanair soon after acquiring the airport for £1.5bn in 2013. In return for more passengers, Ryanair got lower charges.

Alongside, the airport gave the terminal an £80m transformation, adding 50% more space in the departure lounge. And the airline loosened up its notoriously tight policy on carry-on bags to allow people to bring their shopping aboard.

https://www.theguardian.com/business/2016/nov/26/free-air-travel-from-low-fare-to-no-fare-ryanair

3 Celebration, sorrow and slights at Castro’s death (San Francisco Chronicle) While the death of Cuban leader Fidel Castro prompted cheers from the country's exiles in Miami, the 90-year-old revolutionary leader's passing produced expressions of respect in other parts of the world and measured responses from governments that saw the devoted socialist as a threat.

US President Barack Obama noted that while "discord and profound political disagreements" marked the relationship between the US and Cuba for nearly six decades, Americans were extending "a hand of friendship to the Cuban people" during their time of grief. US President-elect Donald Trump took to Twitter to share a thought that proved pithy even for the medium: "Fidel Castro is dead!"

Elsewhere in world, Castro was honored and mourned by many present and former national leaders. Castro's death was felt especially keenly in Latin America, where his success in overthrowing a military regime inspired leftist activists in other countries.

Canadian Prime Minister Justin Trudeau joined the chorus of admirers, calling Castro "a legendary revolutionary and orator" and a "remarkable leader." Trudeau's reaction prompted strong criticism from two Republican US senators, Marco Rubio of Florida and Ted Cruz of Texas, both Cuban-Americans.

"Is this a real statement or a parody? Because if this is a real statement from the PM of Canada it is shameful (and) embarrassing," Rubio tweeted. Cruz wrote: "Disgraceful. Why do young socialists idolize totalitarian tyrants? Castro, Stalin, Mao, Pol Pot -- all evil, torturing murderers."

"I hope his death can start a freedom revolution in Cuba," Denmark's Foreign Minister Kristian Jensen said.

http://www.sfgate.com/news/world/article/Celebration-sorrow-mingle-after-death-of-Fidel-10637092.php

Sluggish global demand hits Japan exports; India demonetization loaded with risks; The rise of Indonesia

1 Sluggish global demand hits Japan exports (Straits Times) Japan's exports fell 10.3 per cent in October from a year earlier, Ministry of Finance data has shown, in a sign of sluggish external demand.

The result compared with the median forecast for an 8.6 per cent fall in a Reuters poll of economists, and followed a 6.9 per cent decline in September. Imports fell 16.5 per cent, versus economists' estimate for a 16.3 per cent fall. The trade balance came to a surplus of 496.2 billion yen, versus the median estimate of a 615.4 billion yen surplus.

http://www.straitstimes.com/business/economy/japan-october-exports-fall-103-in-sign-of-sluggish-global-demand

2 India demonetization loaded with risks (Mihir Sharma in Gulf News) One week after India’s sudden declaration that 500- and 1,000-rupee notes were no longer legal tender, the economy is in chaos. And that’s perhaps because the policy was designed as much to shock and awe observers with the government’s command of the Indian economy as to control India’s “black money” problem.

What seemed at first to be a masterstroke by Prime Minister Narendra Modi now looks like a grave miscalculation. What’s changed in a week? Well, for one, it’s become clear that the government was simply too cavalier in its planning. Now that 86 per cent of India’s currency is no longer valid, the central bank has struggled to print replacement denominations.

You have to wonder if Modi truly sought expert advice, or relied once again on a small and trusted set of politicians to determine policy. India’s simply too big and complex for shock and awe. Large parts of the rural economy use cash for 80 per cent of transactions and have been hard-hit.

The government’s plan is likely to be ineffective in the long term. Economists agree it will have no effect on the generation of black money through corruption. Even in the best case scenario — that a significant proportion of the outstanding currency is destroyed — there’s no reason to suppose it was all black money and not the savings of regular citizens scared of harassment by tax authorities.

Modi has dropped dark hints that this is just the beginning, raising fears that business should now worry about of constant tax raids and the reopening of decades-old cases. In fact, that dark new age may already be here.

Even setting aside the painful adjustment, the long-term effects of this monetary shock on India’s informal economy could well be severe; a large proportion of marginal firms may not survive the loss of a fortnight of income. The informal financial sector — unregistered moneylenders who provide loans to businesses worth 40 per cent of total bank lending — will be decimated.

The costs to the government could be equally high. Modi’s administration has put political considerations over economic detail once too often — and this time, it’s severely dented its image for efficiency and practicality. Even if the long queues vanish in the next few weeks, that damage to the government’s reputation is permanent.

http://gulfnews.com/business/analysis/india-s-currency-move-is-loaded-with-risks-1.1932388

3 The rise of Indonesia (Elizabeth Pisani in The Guardian) Despite being a country of superlatives – most populous Muslim-majority nation, biggest exporter of numerous commodities dug or grown out of its generous earth, one of the world’s most enthusiastic users of Twitter and Facebook – Indonesia also remains, in the words of Indonesian businessman John Riady, the biggest invisible thing on the planet.

I’ve been hearing those same arguments since I first covered Indonesia for Reuters and the Economist in the late 1980s. Over the intervening three decades, per-capita income in Indonesia did indeed rise steeply to $3,300, over five times its level when I first lived there.

Which is great, but not as great as Thailand or Vietnam (between seven and eight times higher), let alone China (where per capita income is now close to $8,000 a year, 26 times its 1985 value).

For a country that has such extraordinary natural resources, and such an abundance of labour, 

Indonesia is arguably underperforming economically. This is in part because the scatter of its 7,000 inhabited islands creates extraordinary infrastructure challenges, in part because a torpid bureaucracy squashes innovation, and in (large) part because Indonesia’s miasmic legal system means no contract is secure.

The much vaunted “demographic dividend” will not deliver the pot of gold at the end of the Indonesian rainbow until all three of these things change. Now, for the first time since a brave but ill-prepared Indonesia declared its independence from Dutch colonists in 1945, at least two of these changes are under way.

That’s no small achievement in a nation as kaleidoscopic as Indonesia, where there are almost as many ethnicities, languages and belief systems as there are islands. The improvements in both infrastructure and governance are especially worthy of global attention because they are being propelled by the twin engines of democracy and decentralisation, both relatively new to Indonesians.

Though Indonesia’s current president, Joko Widodo, known as Jokowi, has made much of his support for infrastructure development, it is driven less by a well-planned push from Jakarta than by active demand from politicians directly elected in district and provincial governments. Though progress is slow, those demands are gradually overcoming the hurdles raised by the country’s geography.

However, neither decentralised democracy nor Jokowi himself have managed an assault on the third major hurdle to Indonesia’s self-actualisation: the legal quagmire referred to by his predecessor as the “judicial mafia”.

https://www.theguardian.com/cities/2016/nov/21/biggest-invisible-thing-on-earth-indonesia-waking-up

India growth faces cash-crunch heat; New age of robots around the corner; When virtual love beats the real thing

1 India growth faces cash crunch heat (Sheetal Agarwal in Business Standard) India’s move withdrawing Rs 500 and Rs 1,000 currency notes, popularly referred to as demonetisation, has dashed expectations of a pick-up in consumption in the second half of the current financial year.

Led by multiple reasons like a normal monsoon after two weak years, higher pay for government employees, increased infrastructure spending and so on, economists and market participants were hoping for a pick-up in India’s gross domestic product and corporate earnings. On the contrary, experts now believe GDP growth in the second half could be lower than that in the first half of this fiscal by a mile, and have lowered their estimates for FY17.

“We estimate that over a year, economic growth can fall by 70-100 basis points, with the maximum impact in the immediate two-quarters, which will see a large contraction in effective money supply,” says Pranjul Bhandari, Chief India Economist, HSBC Securities and Capital Markets.

Sajjid Z Chinoy, Chief India Economist, JPMorgan, says, “Before demonetisation, 10 per cent of GDP came from high-value notes. If even 20 per cent of these do not get returned, the first-round negative wealth shock would be 2 per cent of GDP.” Any such negative wealth shock, however, is expected to depress consumption behaviour, prices of certain asset classes (e.g. real estate), and therefore have secondary wealth effects, he adds.

The cash-heavy sectors such as real estate, jewellery, amongst others could be worst hit from demonetisation and may take a longer time to revive. Though demonetisation will benefit the economy via increased number of tax payers, lower rates which in turn can aid demand and growth, higher financial savings, amongst others; these will accrue on a gradual basis.

The jury is out on the extent of impact demonetisation will have on India’s GDP growth. A lot will also depend on the government and RBI’s reform and policy action to cushion the impact.

http://www.business-standard.com/article/economy-policy/fy17-gdp-growth-faces-cash-crunch-heat-116111900785_1.html

2 New age of robots around the corner (Andrew Staples in Gulf News) Robots designed to mimic people are now on the verge of commercial-scale production, UAE University assistant professor Dr Massimiliano Cappuccio says.

Dr Cappuccio said the cost and capabilities of prototype anthropomorphic robots were such that they were almost ready to leave the tech labs and enter the world as luxury items. “There is the promise of reaching critical mass to start mass production, because you will need at least 100,000, even better one million pieces sold, in order to justify the initial expenses to being mass production.

“When we reach that threshold, then industry will have such an interest that any kind of investment — it doesn’t matter how many zeroes — is justified. At that moment, the technology will spiral.

“It’s a matter of a few years. Already the prices of production are going down, little by little, there are a few thousand units, and it’s just about finding an application in everyday life when people really need that robot and that would justify the scale.”

But the development and use of humanoid robots on such a scale posed moral and ethical questions, said Dr Cappuccio, a philosopher who specialises in cognitive science.

“Do we want robots to be anthropomorphic? How anthropomorphic do we want them to be? There is a debate that we don’t want robots to look like humans for different reasons — one reason is that robots are slaves,” Dr Cappuccio said.

“Interacting with robots that act as slaves, there is a moral issue because, even if they don’t have rights, you as a user are putting yourself in a position as if you were exploiting a human agent. The experience is comparable to that of a human exploiting another human, because it looks like a human. That poses ethical questions.”

http://gulfnews.com/business/sectors/technology/a-new-age-of-robots-is-around-the-corner-1.1932118

3 Virtual love beats the real thing (Tracy McVeigh in The Guardian) Japan’s apparently waning interest in true love is creating not just a marriage crisis but a relationship crisis, leading young people to forgo finding a partner and resort to falling for fictional characters in online and video games.

New figures show that more than 70% of unmarried Japanese men and 75% of women have never had any sexual experience by the time they reach 20, though that drops to almost 50% for each gender by the time they reach 25.

According to Professor Masahiro Yamada, a sociologist at Chuo University in Tokyo, who has coined the phrase “stranded singles” for the phenomenon, the rise in virginity rates is matched by a rise in the lack of interest in having any kind of “real” relationship.

Recent research by the Japanese government showed that about 30% of single women and 15% of single men aged between 20 and 29 admitted to having fallen in love with a meme or character in a game – higher than the 24% of those women and 11% of men who admitted to falling in love with a pop star or actor.

The development of the multimillion-pound virtual romance industry in Japan reflects the existence of a growing number of people who don’t have a real-life partner, said Yamada. There is even a slang term, “moe”, for those who fall in love with fictional computer characters, while dating sims allow users to adjust the mood and character of online partners and are aimed at women as much as men.

But Yamada says this is only a small part of the problem, which has its roots in traditional culture. Young people want conventional marriage and will wait for it. They don’t want to cohabit or have children outside marriage – Japan has the lowest rate of babies born outside marriage in the world at 2.2%, compared with Britain’s 47%.

Professor Adrian Favell, a sociologist at the University of Leeds, cautioned against the idea of a dysfunctional generation in Japan, saying that the west liked to exaggerate the “oddness” of young Japanese people. He said that a declining population was not necessarily “bad news”. “Is it unique to Japan for young people to obsess over pop, film stars, and the rest? Or to ‘fall in love’ on the internet? I don’t think so,” he said.

https://www.theguardian.com/world/2016/nov/20/japan-stranded-singles-virtual-love

US Fed chief points to rate rise 'soon'; Saudi oil chief wants Opec to cut output; Dead teenager's body to be cryogenically frozen

1 US Fed points to a rate rise ‘soon’ (BBC) The chair of the US Federal Reserve, Janet Yellen, has indicated that it could raise interest rates "relatively soon". She said the job market had made further improvements this year and that inflation, while still below the Fed's 2% target, had started to pick up.

Financial markets are expecting the Fed to take action at a meeting next month. She also defended the independence of central banks after criticism of the Fed by President-elect Donald Trump. It would be only the second rate rise since the bank pushed rates to a record low during the financial crisis.

In December last year, the Fed raised its benchmark rate for the first time in seven years, from near zero to its current level of between 0.25% and 0.5%. Ms Yellen said that further delaying a rate increase would present its own risks.

Turning to the independence of central banks, Ms Yellen said they need to be able to make long term decisions that are not always popular. In countries where central banks are subject to political pressures, there have been "terrible" consequences, she said.

http://www.bbc.com/news/business-38017630

2 Saudi oil chief wants Opec to cut output (Khaleej Times) The energy minister for top Opec exporter Saudi Arabia has said he was optimistic about the Opec's deal to limit oil output and mentioned the lower end of a previously agreed production target, helping spur a rally in the price of crude.

The Organisation of the Petroleum Exporting Countries, at a meeting in Algeria in September, made a preliminary deal to limit oil output. The details are meant to be finalised when Opec ministers gather in Vienna on November 30.

Saudi Energy Minister Khalid Al Falih said the oil market was on a path towards becoming balanced and that "reaching [a decision] to activate that ceiling of 32.5 million barrels per day will speed up the [market] recovery and will benefit producers and consumers". The Opec agreed on September 28 to limit supply to between 32.5 million and 33 million bpd, with special conditions given to Libya, Nigeria and Iran, whose output has been hit by wars or sanctions.

A number of Opec energy ministers, including Al Falih, are expected to meet informally in Doha on the sidelines of a gas exporters' conference to try to build consensus. Algeria's Energy Minister Nouredine Bouterfa said the issue of Iran's production would not undermine a deal.

http://khaleejtimes.com/business/markets/saudi-oil-chief-urges-opec-to-cut-output-to-low-end-of-target

3 Dead teenager to be cryogenically frozen (Owen Bowcott & Amelia Hill in The Guardian) A 14-year-old girl who said before dying of cancer that she wanted a chance to live longer has been allowed by the high court to have her body cryogenically frozen in the hope that she can be brought back to life at a later time.

The court ruled that the teenager’s mother, who supported the girl’s wish to be cryogenically preserved, should be the only person allowed to make decisions about the disposal of her body. Her estranged father had initially opposed her wishes.

During the last months of her life, the teenager, who had a rare form of cancer, used the internet to investigate cryonics. Known only as JS, she sent a letter to the court: “I have been asked to explain why I want this unusual thing done. I’m only 14 years old and I don’t want to die, but I know I am going to. I think being cryo‐preserved gives me a chance to be cured and woken up, even in hundreds of years’ time.

“I don’t want to be buried underground. I want to live and live longer and I think that in the future they might find a cure for my cancer and wake me up. I want to have this chance. This is my wish.”

Following the ruling, in a case described by the judge as exceptional, the body of JS has now been preserved and transported from where she lived in London to the US, where it has been frozen “in perpetuity” by a commercial company at a cost of £37,000.

The girl’s parents are divorced. She had lived with her mother for most of her life and had had no face-to-face contact with her father since 2008. She resisted his attempts to get back in touch when he learnt of her illness in 2015.

Since the first preservation by freezing in the 1960s the process has been performed only a few hundred times. The body has to be prepared shortly after death, ideally within minutes. Arrangements then have to be made for the body to be transported by a registered funeral director.

A child cannot make a will and the court had to decide where the girl’s best interests lay. The judge concluded that allowing the mother to make a decision about her daughter would be in her best interests. The girl died peacefully knowing that her body would be frozen, the judge recorded.

https://www.theguardian.com/science/2016/nov/18/teenage-girls-wish-for-preservation-after-death-agreed-to-by-court

Obama says no way back from globalisation; RBS may be fined $12bn for mis-selling; Behind India's rupee shake-up

1 Obama says no way back from globalization (BBC) US President Barack Obama has made a strong defence of globalisation as he arrived in Germany on his final visit to Europe before leaving office. In a joint article, Mr Obama and German Chancellor Angela Merkel said that with the global economy developing faster than ever, co-operation was vital.

Mr Obama arrived in Germany from Athens where he had warned of threats to modern democracy. He is seeking to calm unease following the election of Donald Trump. The two leaders voiced support for the proposed Trans-Atlantic Trade and Investment Partnership (TTIP) between the US and the EU.

By contrast, Mr Trump is a fierce critic of global free trade agreements and welcomed the UK's decision in June to leave the EU. In Athens, Mr Obama acknowledged that globalisation had created a "sense of injustice" and a "course correction" was needed to address growing inequality.

http://www.bbc.com/news/world-europe-38006937

2 RBS may be fined $12bn for mis-selling (Jill Treanor in The Guardian) Royal Bank of Scotland could face a penalty of more than $12bn to settle a decades-old mis-selling scandal in the US, the body which controls the taxpayer stake in the bank has said.

The bailed-out bank has not set aside any money for a settlement with the US Department of Justice (DoJ) over the mis-selling of residential mortgage-backed securities (RMBS) before the 2008 banking crisis.

Uncertainty about the scale of the penalty is one of the reasons cited by the chancellor, Philip Hammond, for abandoning any hope of further reducing the taxpayer stake, which currently stands at 73%. However, the chairman of UK Financial Investments laid out the possible financial impact of the looming fine at a hearing of the Treasury select committee on Wednesday.

James Leigh-Pemberton pointed to negotiations under way between the DoJ and Deutsche Bank, which have started at $14bn. He said the RBS fine “might be $5bn, it might be $12bn”. He added: “Based on what happened to Deutsche Bank it could be more.”

https://www.theguardian.com/business/2016/nov/16/rbs-may-fined-more-than-12bn-settle-us-mis-selling-scandal

3 Behind India’s rupee shake-up (Sarosh Bana in Straits Times) The decision by India’s Narendra Modi government to abruptly demonetise high-value currency aims to combat the twin menaces of a crippling shadow economy and terrorist financing that have been undermining the nation's economy and security.

India's parallel economy is estimated to be worth $445.8 billion, amounting to a fifth of the country's $2.02 trillion gross domestic product and surpassing the economies of countries such as Thailand and Argentina.

Last week's radical step, however, sucked 22 billion of the 500-rupee and 1,000-rupee denomination banknotes - worth over 14 trillion rupees - out of the economy, forcing those within the law to rush to banks to trade in the notes for limited exchanges.

The 7.85 trillion rupees' worth of the scrapped 500-rupee notes and 6.33 trillion rupees' worth of the 1,000-rupee notes constituted an overwhelming 86 per cent of the value of Indian currency in circulation. Their combined volumes also accounted for just over 24 per cent of the overall 90.3 billion banknotes of all denominations in circulation.

India's "black economy" - economic activities outside formal banking channels - is generated significantly from bribery that is rampant in government. Much is routed through gold, real estate, the film industry, the informal sector and businesses that flourish on cash transactions.

Mr Modi also specified that the demonetisation would help clamp down on the use of hawala for terror funding. The demonetisation is also intended to flush out fake Indian currency, much of which is reportedly counterfeited and pushed into India by Pakistan to fund cross-border terrorism and also to undermine the Indian economy.

The Prime Minister now warns of further measures against black money, following demonetisation. In a public address, he asked his audience: "You tell me, whether money that has been stolen should be exposed or not?" There was a resounding "Yes".

http://www.straitstimes.com/opinion/behind-the-rupee-shake-up

Philippines growth powers ahead at 6%; Snapchat prepares for IPO; A lavish wedding and cash-hit Indians

1 Philippines growth powers ahead at 6% (Straits Times) Neither Donald Trump's protectionist ambitions nor Rodrigo Duterte's rants against the US are proving to be enough to derail the Philippine economy's momentum as one of the fastest-growing in the world.

Economists surveyed by Bloomberg News see growth exceeding 6 per cent until 2018. Gifted with a burgeoning middle class and backed by $50 billion of revenue from remittances and outsourcing, the Southeast Asian economy is getting an additional boost from President Duterte's $160 billion-infrastructure plan.

Political risks "haven't transpired into concrete policies," said Gundy Cahyadi, an economist at DBS Group Holdings Ltd. in Singapore. "We should pay more attention to hard data, which point to very robust growth prospects for the Philippines, given strong domestic demand."

While the Philippines hasn't been immune to the financial market rout since Trump's shock win in the US election, strong domestic growth drivers have made it more resilient to global shocks compared to export-dependent Asian nations from Singapore to South Korea. Consumer spending makes up about 70 per cent of the economy.

At the same time, Duterte has pledged to ramp up spending on roads, airports, seaports and railways to lure investors and create jobs. The Philippines has one of the lowest government debt ratios in Southeast Asia, at 40 per cent of GDP, giving it room to boost spending.

http://www.straitstimes.com/business/economy/trump-duterte-cant-stop-philippines-powering-ahead-with-6-growth

2 Snapchat prepares for IPO (The Guardian) Messaging app Snapchat has filed confidentially with the US Securities and Exchange Commission for an initial public offering, sources familiar with the situation said.

The filing puts the Venice, California-based company one step further towards its IPO, which sources say could come as soon as March and value it at $20bn to $25bn, making it one of the biggest technology offerings in recent years.

Under America’s Jumpstart Our Business Startups Act, companies with less than $1bn in revenue can secretly file for an IPO, allowing them to quietly test investor appetite while keeping financials confidential.

Snapchat started in 2012 as a free mobile app that allows users to send photos that vanish within seconds. It has more than 100 million active users, about 60% of whom are aged 13 to 24, making it an attractive way for advertisers to reach millennials. Awash in venture funding, the company raised $1.81bn in May, which valued it at about $20bn, media reports said at the time.

But investors worry that Snapchat’s advertising sales, which began last October, is the company’s only significant revenue source. Snap in September started describing itself as a camera company, and earlier this month it debuted its $130 video-camera sunglasses.

https://www.theguardian.com/technology/2016/nov/15/snapchat-ipo-video-app-worth

3 A lavish wedding and cash-hit Indians (BBC) The lavish wedding of the daughter of an Indian politician has sparked outrage as millions across the country are in the midst of a cashflow crisis. The five-day wedding of businessmen and ex-state minister G Janardhana Reddy's daughter, Brahmani, is estimated to cost about 5bn rupees ($74m; £59m).

But with gold-plated invitations and Bollywood stars expected to perform, the nuptials have proved controversial. Critics have described it as an "obscene display of wealth".

The wedding kicked off just days after the Indian government announced it would scrap 500 and 1,000 rupee notes in a crackdown on undeclared wealth, making redundant the vast majority of cash that Indians use on a daily basis. Millions of Indians have been standing in queues in an effort to deposit or exchange the old currency and frustration is widespread.

Mr Reddy was quoted as saying that he had mortgaged properties in Bangalore and Singapore to raise money for the wedding and that all payments were made six months ago when the planning started. His political opponents meanwhile have used it to speculate if the prime minister's drive against illegal "black money" would include elites.

A former member of Prime Minister Narendra Modi's Bharatiya Janata Party (BJP) in Karnataka state, Mr Reddy recently spent three years in jail on corruption charges, which he denies, and was freed on bail last year.

http://www.bbc.com/news/world-asia-india-37984299

'Economic frustration led to Trump, Brexit'; 2016 may be hottest year; Facebook's fake news crisis

1 ‘Economic frustration led to Trump, Brexit’ (Katie Allen in The Guardian)  Politicians around the world risk giving more traction to nationalistic movements if they continue to ignore the growing numbers of workers getting a “raw deal” from globalisation, the head of the UN’s labour agency has warned.

The director general of the International Labour Organization, Guy Ryder, described Donald Trump’s victory in the US presidential election and the UK’s vote for Brexit as “the revolt of the dispossessed” and gave a damning assessment of the establishment’s failure to offer an alternative to protectionism.

British-born Ryder said governments had been too quick to focus on headline figures that flattered the state of labour markets since the global financial crisis. In so doing they had failed to scratch below the surface into a world of zero-hours contracts, underemployment and unreliable incomes, he said, as the ILO released research showing a rise in such non-standard forms of employment.

Speaking days after Trump stunned the world with his victory over Hillary Clinton, the ILO chief highlighted the common ground between the Republican candidate’s supporters and those who voted for the UK to leave the EU. “It is the people who feel they haven’t benefited from globalisation and from the EU, from the way things are organised. This is the revolt of the dispossessed in that regard,” he said.

The ILO report finds temporary work, agency work, precarious self-employment and other non-standard forms of employment have become more widespread. On the ground, that translates into downward pressure on earnings, unreliable working hours and lower access to workplace benefits.

His comments reflect the tendency among ministers to focus on record employment levels and falling unemployment, while largely ignoring that wages have stagnated, people have felt pressured into self-employment and millions say they want to work more hours than they can get.

https://www.theguardian.com/business/2016/nov/14/economic-frustration-spawned-trump-brexit-warns-ilo-chief

2 This year may be hottest ever (San Francisco Chronicle) The UN weather agency says 2016 is set to break the record for the hottest year since measurements began in the 19th century.

The World Meteorological Organization said Monday that preliminary data through October shows global average temperatures this year are 1.2 degrees Celsius (2.2 degrees Fahrenheit) above pre-industrial levels.

That's getting close to the limit set by the global climate agreement adopted in Paris last year. It calls for limiting the temperature rise since the industrial revolution to 2 degrees C or even 1.5 degrees C. This year's temperatures were boosted by the El Nino weather event.

The previous hottest year was 2015. WMO said 16 of the 17 hottest years have occurred this century, with the only exception being 1998, which was also an El Nino year.

http://www.sfgate.com/news/world/article/2016-on-track-for-hottest-year-on-record-10612463.php

3 Facebook’s fake news crisis (Dave Lee on BBC) Despite the best efforts of Mark Zuckerberg to downplay Facebook’s role in the election of Donald Trump, the scrutiny of how fake news is spread on the platform has intensified. Buzzfeed News is reporting that "more than dozens" of Facebook employees have created an unofficial task force dedicated to addressing the issue.

 “[Mark Zuckerberg] knows, and those of us at the company know, that fake news ran wild on our platform during the entire campaign season,” the source said. Meanwhile, Google announced it would do more to prevent fake news sites from making money through advertising.

Earlier, Facebook denied claims that a tool to whittle out fake news had been created before the election, only to be shelved due to concerns it would make Facebook look like it was censoring conservative views. Mr Zuckerberg appears to be increasingly agitated by the suggestion that fake news was a serious problem on his site.

He posted a lengthy update to his profile page defending it. "Of all the content on Facebook, more than 99% of what people see is authentic,” he wrote. "Only a very small amount is fake news and hoaxes. The hoaxes that do exist are not limited to one partisan view, or even to politics."

His conclusion: "Overall, this makes it extremely unlikely hoaxes changed the outcome of this election in one direction or the other." That statistic - 99% - has been the subject of much derision as it apparently refers to content of any kind being posted to Facebook.

In May, Facebook came under heavy criticism after it was alleged that human editors working on the Trending Topics section of Facebook were removing stories that pushed a conservative or pro-Trump agenda. Facebook denied this was the case, but removed the human element anyway in an attempt to appear neutral.

http://www.bbc.com/news/technology-37983571

Japan growth faster than expected; Colombian government, Farc in new peace deal; Facebook turns job portal

1 Japan growth faster than expected (BBC) Japan's economy expanded at a faster-than-expected rate between July and September, due to higher exports. Gross domestic product rose at an annualised rate of 2.2% in the three months to September, the third straight quarter that the economy expanded.

Japanese firms have relied on overseas sales to make up for lacklustre domestic demand. There are concerns a Donald Trump US presidency will hurt Japan if anti-free trade rhetoric became a reality.

But since the election result, the yen has fallen against the dollar. That makes Japanese goods cheaper abroad, which is good news for the country's exporters.

The latest official data showed the world's third-largest economy expanded by 0.5% compared with the three months to June - better than the forecast of 0.2% growth. However, analysts said this pace could not be sustained for as long as the economy relied on exports.

http://www.bbc.com/news/business-37970456

2 Colombian government, Farc reach new peace deal (Sibylla Brozinsky in The Guardian) A new peace deal reached between the Colombian government and leftist Farc guerrillas aims to broaden support after voters last month narrowly rejected an original accord to end more than 50 years of conflict.

Government and rebel negotiators announced in Havana that they had agreed on a host of modifications to the original deal, taking into account objections from different sectors of society that campaigned against it, led by former rightwing president Álvaro Uribe.

Colombian voters rejected that deal in a plebiscite on 2 October, sending negotiators back to the drawing board. Although the text of the new agreement was not immediately published, the president, Juan Manuel Santos, laid out certain changes in a televised speech. Some are little more than clarifications of the often-vague language of the text.

Under the new agreement, Farc commits to declare and hand over all their assets, which will be used for reparations to victims of the conflict, a provision not included in the first accord and demanded by leaders of the no vote.

Many Colombians who rejected the deal said they did so because they wanted to see guerrillas behind bars for the thousands of kidnappings and killings they were responsible for. The new agreement does not include jail time for former rebels but better defines the kinds of alternative punishment they will face under a special tribunal that will prosecute war crimes, according to Santos.

https://www.theguardian.com/world/2016/nov/13/colombian-government-and-farc-reach-new-peace-deal

3 Applying for a job on Facebook (Emily Price in San Francisco Chronicle) The next time you apply for a job, you might submit your application through Facebook. A Facebook representative confirmed that it’s currently experimenting with a number of recruiting features within the site, including giving companies the ability to accept job applications via their official company page.

If implemented, it could put the social network in direct competition with LinkedIn, and give businesses even more of a reason to drive traffic to their Facebook Pages. Job postings on Facebook would include everything you might typically expect to find in a job ad, including salary information, title, and whether the position is full or part-time.

An “Apply Now” button also allows job seekers to apply for positions they’re interested in directly from the social network, and businesses will receive those applications through Facebook Messenger. Applications will be partially filled out using information from the Facebook user’s public profile, so if you’re firing off a few apps you’ll be able to do so fairly quickly.

Beyond creating an easy way for people to apply to jobs, Facebook could make it easier for career seekers to locate available positions. Recruiters will be able to promote job openings just like any other post on Facebook, potentially reaching more prospective applicants than they might through LinkedIn, which has significantly fewer users.

http://blog.sfgate.com/techchron/2016/11/08/soon-you-might-be-able-to-apply-for-a-job-on-facebook/

Without Opec cut, expect oil glut in 2017; 'Oval office will tame Donald Trump'; India's currency chaos

1 Without Opec cut, expect oil glut in 2017 (Khaleej Times) The oil market surplus may run into a third year in 2017 without an output cut from Opec, while escalating production from exporters around the globe could lead to relentless supply growth, the International Energy Agency (IEA) said on Thursday.

The group said global supply rose by 800,000 barrels per day in October to 97.8 million bpd, led by record Opec output and rising production from non-Opec members such as Russia, Brazil, Canada and Kazakhstan.

The IEA kept its demand growth forecast for 2016 at 1.2 million bpd and expects consumption to increase at the same pace next year, having gradually slowed from a five-year peak of 1.8 million bpd in 2015.

The Organisation of the Petroleum Exporting Countries meets at the end of November to discuss a proposed cut in production to a range of 32.5 to 33 million bpd, but discord among members has raised doubt over Opec's ability to deliver a meaningful reduction.

"If no agreement is reached and some individual members continue to expand their production, then the market will remain in surplus throughout the year. Indeed, if the supply surplus persists in 2017, there must be some risk of prices falling back,"   IEA said.

http://khaleejtimes.com/business/markets/no-opec-cut-expect-oil-glut-in-2017-says-iea

2 ‘Oval office will tame Donald Trump’ (Nouriel Roubini in The Guardian) If Donal Trump governs in accordance with the campaign that got him elected, we can expect market scares in the US and around the world, as well as potentially significant economic damage. But there is good reason to expect that he will govern very differently.

A radical populist Trump would scrap the Trans-Pacific Partnership (TPP), repeal the North American Free Trade Agreement (Nafta), and impose high tariffs on Chinese imports. He would also build his promised US-Mexico border wall; deport millions of undocumented workers; restrict H1B visas for the skilled workers needed in the tech sector; and fully repeal the Affordable Care Act (Obamacare), which would leave millions of people without health insurance.

Overall, a radical Trump would significantly increase the US budget deficit. He would sharply reduce taxes on corporations and wealthy individuals. He would increase military and public-sector spending in areas such as infrastructure, and his tax cuts for the rich would reduce government revenue by $9tn over a decade.

But it is actually more likely that Trump will pursue pragmatic, centrist policies. For starters, Trump is a businessman who relishes the “art of the deal”, so he is by definition more of a pragmatist than a blinkered ideologue.

Once in office, Trump will throw symbolic red meat to his supporters while reverting to the traditional supply-side, trickle-down economic policies that Republicans have favoured for decades. Trump’s vice-presidential choice, Mike Pence, is an establishment GOP politician, and his campaign’s economic advisers were wealthy businessmen, financiers, real-estate developers, and supply-side economists.

The market itself will be Trump’s biggest constraint. If he tries to pursue radical populist policies, the response will be swift and punishing: stocks will plummet, the dollar will fall, investors will flee to US Treasury bonds, gold prices will spike, and so forth.

To be sure, the policy mix under a pragmatic Trump administration would be ideologically inconsistent and moderately bad for growth. But it would be far more acceptable to investors – and the world – than the radical agenda he promised his voters.

https://www.theguardian.com/business/2016/nov/11/oval-office-will-tame-us-president-donald-trump

3 India’s currency chaos (San Francisco Chronicle) Chaotic scenes played out across India on Saturday, with long lines growing even longer and scuffles breaking out, as millions of anxious people tried to change old currency notes that became worthless days earlier when the government demonetized high-value bills.

Paramilitary troops posted at banks in some of the most congested areas of New Delhi walked among the crowds urging people to stay calm. Frustrations grew as reports came in that some banks had run out of new currency notes.

On Tuesday, India's government made a surprise announcement that all 500- and 1,000-rupee notes had no cash value, in an effort to tackle corruption and tax evasion. Problems arose because more than half of India's more than 200,000 ATMs had not been reconfigured to dispense the new 2,000-rupee notes introduced by the government, according to Finance Minister Arun Jaitely.

He said it would take two to three weeks for all the ATMs in the country to be recalibrated to handle the new notes. He said the changes in the cash dispensers could not have been done earlier because the government wanted to maintain secrecy about the demonetization.

Meanwhile, anger was mounting as people, frustrated with the delays and long hours spent in serpentine lines, lost their cool, lashing out at the government and bank employees. Delhi police said they received more than 3,000 emergency calls reporting fights and scuffles in the city Friday as people crowded outside banks, waiting to exchange notes or withdraw money.

On Saturday, nearly 200 calls had been received in the first four hours since the banks opened at 9 a.m. local time, according to police. In the southern city of Kollam, furious crowds smashed glass panes and vandalized a bank after the manager announced to waiting clients that the bank had run out of new bills.

http://www.sfgate.com/news/world/article/Chaos-as-millions-in-India-crowd-banks-to-10609976.php