1 China’s different sort of housing bubble (Noah
Smith in Gulf News) Right now, much of the world is in danger from a potential
recession in China. China, which still is the biggest contributor to global
growth, has been looking shaky for a couple of years now. Growth is down from
insanely fast to moderately fast.
It’s the housing sector that will really make or
break the country’s economic destiny. Prices fell in 2014 and early 2015, and
it looked as if the long-promised Chinese housing crash had finally arrived. If
a true crash ever does come, it may well be catastrophic. China doesn’t have
well-developed stock markets, so households save a lot of their money, directly
or indirectly, in housing and land. Much of the economy itself is based on
real-estate development.
Some economists interpret the housing boom as a
bubble. Kaiji Chen and Yi Wen of the Federal Reserve Bank of St Louis have a
model in which demand for housing as a savings vehicle kicks off expectations
of rising prices that then become a self-fulfilling prophecy.
Some other papers take a more agnostic view. Jing
Wu, Joseph Gyourko and Yongheng Deng, for example, note that price-to-rent
ratios are very high, meaning that small downward revisions in growth
expectations could cause prices to fall a lot.
Homebuyers may not be borrowing like crazy, but
real-estate developers and many other companies have. If slowing economic
growth causes households to pull back on their housing purchases, it could be
companies, and the banks that lend to them, that are on the hook. Even if the
housing market isn’t a true bubble, a downturn could still wreak a lot of
damage on the Chinese economy — and on all the economies around the world that
are dependent on China.
2 Disney breaks record, takes $7bn in a year (Mark
Sweney in The Guardian) Disney has become the first film studio to take $7bn in
global ticket sales in a year, with Star Wars spin-off Rogue One joining the
hit factory production line alongside Marvel superheroes and animated
children’s movies.
With Rogue One: A Star Wars Story, the spin-off tale
of the mission to steal the plans for the Death Star, taking almost $300m globally
on its opening weekend, Disney has easily shot past the previous $6.9bn annual
ticket sales record set by rival Universal last year with hits including
Jurassic World and Furious 7.
With almost two weeks of the year left, the momentum
generated by the most famous sci-fi franchise in the world and the popularity
of the studio’s animated film Moana ($282m and counting) is likely to push Disney’s
overall takings closer to $8bn.
Disney has already released the four top-grossing
films of the year so far with Captain America: Civil War, Finding Dory and
Zootopia taking more than $1bn at the global box office, while a live-action
version of The Jungle Book fell just short. Doctor Strange, starring Benedict
Cumberbatch, released in November, has made more than $650m to date.
The record haul is the crowning achievement of a
decade long strategy to reinvigorate Disney’s film division by buying up
blockbuster franchises, characters and talent. In 2006, Disney spent $7.4bn
buying Apple founder Steve Jobs’ Pixar, the hit factory behind Finding Nemo,
its sequel Finding Dory, Toy Story and The Incredibles, to help revive its once
proud tradition of producing hit animated films.
This was followed in 2009 by the surprise $4bn
purchase of Marvel Comics’ superhero universe, bringing in characters including
X-Men, Iron Man and Captain America, which took Disney into new live action
territory. The third transformational deal was snapping up George Lucas’
Lucasfilm, maker of Star Wars and the Indiana Jones franchises, in a $4bn deal
in 2012, with a plan to vastly expand the sci-fi franchise starting with 2015’s
The Force Awakens.
3 Balochistan rebels protect rare birds from Gulf
royals (BBC) Suspected rebels have attacked a hunting party of Gulf royals in
the Pakistani province of Balochistan. The gunmen let the men off with a
warning not to hunt in the area, after firing bullets into their vehicle,
officials said.
Hundreds protested in Balochistan on Tuesday against
Arab hunting parties, which travel to Pakistan every year. Farmers say the
hunts endanger the birds and damage crops. Pakistan issues dozens of permits
every winter to the royal families of the Middle East to hunt rare Houbara
bustards in its southern plains. The princes and their wealthy friends consider
the bird's meat to be an aphrodisiac.
The Supreme Court lifted a ban on hunting the birds
earlier this year, after the government argued it helped build diplomatic relationships
with Arab dignitaries. The shooting incident happened in the remote hilly
tracts in Gichk area, some 90km south of Panjgur.
The Balochistan Liberation Front (BLF) said it
carried out the attack. "Our fighters let the sheikhs go unharmed in view
of our ancient mutual links and values and in the hope that in future they
won't obtain lease of any area of Balochistan for hunting from the occupying
country, Pakistan," a statement said.
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