A continuing resolution which re-opens the federal government was passed along with a debt ceiling increase that keeps everything hummin’ along until February. It’s good news, at least until the next manufactured crisis comes. We can’t be sure what kind of economic damaged was done in the 16 day shutdown until … well, until the workers in the government that tabulate this stuff get back to work.
So what stories have we missed during the obsession over the limits? Quite a few, actually. Here’s a rundown of some of the interesting stories that were easily lost over the last two weeks.
JP Morgan continues to accumulate fines and other liabilities, the most important from the still evolving “London Whale” disaster. The US Commodities Futures Trading Commission fined them $100M over the event, which just a month ago generated a record $920M in fines to various US and UK agencies. The bloodletting is far from over, and JP Morgan admitted that they are holding $23B in reserve to cover fines, lawsuits, and other liabilities they see coming. All these fines sent the behemoth company to its first quarterly loss since 2004 – when the failure of Enron set the previous records for fines.
CEO Jamie Dimon insists that putting this kind of cash aside is proof that the worst is behind JP Morgan. Investors seem to believe this, with the stock relatively stable. But it’s been a tough quarter.
The other source for stories that seems to never die is Europe. However, things are very much turning around for the Eurozone ever since very tough budget control measures were introduced. Italy is actually running a budget surplus, and Greece is very close. The problem, however, is that after 6 quarters of economic contraction their debt to GDP ratio has only gotten worse. They hope to have this turned around next year as a decent expansion of 2.3% is projected, but we’ll all have to believe that when we see it.
Austerity is far from dead in Europe, and it may have done some good. As it stands now, European nations are far more committed to the Euro than ever before and are working closely together to keep it strong. Their storm appears to have passed.
Not so in Japan, where Typhoon Wipha swept through and caused a lot of damage. The situation remains far from stable at the Fukushima nuclear plant, where it appears contaminated soil was loosened by the storm and may be washed into the ocean. The reactor is far from stable and has continued to leak since the2011 earthquake and tsunami. Foreign experts are finally being called in to assist the plant as the operating company, Tokyo Power (Tepco) is finally admitting they are in over their heads.
In November, a critical operation will take place where spent reactor fuel will be lifted from one of the reactors. It’s a very tricky operation and many observers think it should not even be attempted yet. It’s very much worth watching.
Meanwhile, the situation with Mexican migration has become bigger than ever – that is, the number of people emigrating to Mexico. A shortage of skilled labor is drawing people from all over the world to what has been one of the fastest growing economies in the world. It’s been in a little bit of a slump lately, but generally the boom is on for Mexico. Mexican migration to the United States has reached equilibrium, with about as many Mexicans moving north from 2005 to 2010 as those returning south. The number of Americans legally living and working in Mexico grew to more than 70k in 2012 from 60k in 2009, a number that does not include many students and retirees, those on tourist visas or the roughly 350k American children who have arrived since 2005 with their Mexican parents.
These are just a few of the stories that will continue to develop in ways that might yet bubble into the mainstream media now that our own li’l sideshow is over. Won’t normal, regular news be fun?