As central bankers gather at Jackson Hole and every investor waits on the edge of their seat for a clearer signal on the direction and future of Federal Reserve monetary policy, one thing has remained fairly constant.
…could one day become Tencent.
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The Chinese internet giant is at the cusp of becoming the country’s most valuable firm. Its mighty rise has taken its valuation to $250 billion, second only to China Mobile, and well ahead of the large state-owned banks and oil companies that have dominated China’s capital markets for the better part of the past decade. The rise of a Shenzhen-based, private company at the crossroads of internet technology, social media and gaming reflects several changes under way in China.
British retail sales figures for July could pleasantly surprise economists after data on Wednesday showed the country’s labour market performed much better than expected in the month after the Brexit vote.
Since Britain’s historic vote on June 23 to leave the European Union, the economic impact has been limited to private-sector surveys that suggest the UK is either already in a sharp downturn or just headed into a mild recession. Nothing suggest things are the same or better.
Britain’s high street stores aren’t the only ones who’ll be concerned by fairly dismal retail sales figures from the Confederation of British Industry on Wednesday. It’s a cause of worry for manufacturers too.
David Cameron was caught on tape humming a merry tune as he walked back into 10 Downing Street after announcing that Theresa May would succeed him as prime minister; yet May herself now has the unenviable job of picking up the pieces he left behind. She inherits leadership of a country whose social divisions were cruelly exposed by the referendum campaign, and which does not as yet have a clear roadmap for its future.
Britain’s political and economic crisis deepened overnight with Fitch joining other major credit ratings agencies in downgrading its sovereign debt. The pound hit a 31-year low as part of a market lurch which has wiped a record $3 trillion off global shares since the vote, with investors ignoring finance minister George Osborne’s soothing words earlier in the day. England’s ignominious Euro 2016 defeat at the hands of lowly Iceland only compounded the gloom: “Brexit2″ trended on Twitter in an explosion of gallows humour. “The beautiful Irony,” joked one Twitter user. “#England knocked out of #Euro2016 by country not even in the EU! Maybe that’s why they pressed the #Brexit button.” Just as humiliating, it turns out there is a push to remove English as an official language of the European Union…
Leaver-In-Chief Boris Johnson has used his regular Daily Telegraph column to paint a rosy picture of Britain’s future post-Brexit. There won’t be any of that nasty EU red tape or freedom of movement. But hard-working Poles will be able to stay in the UK and dynamic British entrepreneurs will still have access to the EU single market. All the money the UK sends to Brussels? That can be spent on a better health service. And yes, Mark Carney and George Osborne are good, wise men with their hands firmly guiding the economy. Let’s not rush — everything will turn out fine. In fact, it will be like a divorce in which the couple still live in the same house, do the washing up together, and even share the same bed. For the children, it will be the same as before, just somehow better.
Hang on a minute. Others will say this has all the plausibility of a fairy tale, a lullaby to put the children to sleep while the real slanging match goes on down below. Either that, or a dangerous case of British hubris and wishful thinking. The problem with divorce Boris-style is that there is another partner here who might not buy that arrangement. Can the EU really give Britain access to the single market without insisting that it signs up to freedom of movement, one of its most cherished principles? And why should Britain alone not have to pay into Brussels coffers or adhere to its regulations? If Britain were to get a deal like that, surely others would want the same? And one last point. Johnson writes that he believes that those who voted Leave were not mainly driven by anxieties about immigration. Sure, many weren’t, but quite a few were — and they won’t be happy if they don’t see actual change. At the risk of stretching the divorce metaphor too far, will UKIP’s Nigel Farage be the child who does not fall asleep and bursts into the kitchen in his pyjamas shouting: “But daddy — you promised!”