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.
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.
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.
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