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Category: Economics/Business

China’s ‘industrial policy of everything’ leaves rest of the world in the dust

China’s ‘industrial policy of everything’ leaves rest of the world in the dust

Greg Ip writes: In the decades since China joined the world economy, U.S. presidents have traveled to Beijing with a predictable list of demands: stop stealing American intellectual property, don’t force technology transfer, open your markets. Donald Trump followed the script on his previous visit in 2017. Whether he does so again this week, it would be pointless. Those demands reflect a view of Chinese industrial policy (broadly, government support for favored sectors) that is woefully out of date. Xi…

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As Trump meets Xi, Iran lets Chinese ships through Strait of Hormuz

As Trump meets Xi, Iran lets Chinese ships through Strait of Hormuz

The New York Times reports: Iran has allowed some Chinese vessels to pass through the Strait of Hormuz following diplomatic overtures from China’s government, semiofficial Iranian news agencies reported on Thursday. The reports coincided with a visit to Beijing by President Trump, who held talks with China’s leader, Xi Jinping, on Thursday that were expected to focus heavily on the crisis over the strategic waterway. Dueling Iranian and U.S. attempts to control traffic in the strait have rattled global energy…

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Meta: What it’s like inside a company where ‘everyone is unhappy’

Meta: What it’s like inside a company where ‘everyone is unhappy’

Wired reports: As Meta employees brace for layoffs next Wednesday, May 20, many say the vibes are horrifically, historically low. “Everyone is unhappy; the only people who are not unhappy are, literally, executives,” says an employee who works on Instagram. The social media giant plans to cut about 10 percent of its workforce, or nearly 8,000 people, “to run the company more efficiently” and “offset the other investments” it’s making, according to a human resources leader. But the layoffs, which…

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Backlash as Utah approves datacenter twice the size of Manhattan

Backlash as Utah approves datacenter twice the size of Manhattan

The Guardian reports: A plan to create one of the world’s largest datacenters, a gargantuan project spanning an area more than twice the size of Manhattan, has provoked a furious public backlash in Utah amid concerns over its vast energy use and impact upon the state’s stressed water supplies. The Stratos artificial intelligence datacenter footprint will cover more than 40,000 acres (62 sq miles) over three sites in Box Elder county in north-western Utah. The facility will require about 9GW…

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Chinese view Trump as an ‘accelerator of American political decay’

Chinese view Trump as an ‘accelerator of American political decay’

The New York Times reports: When President Trump visited China in late 2017, Xi Jinping welcomed him with a grand display of Chinese history and culture: a four-hour private tour of the Forbidden City culminating in a performance by the Peking Opera. Eight years, a pandemic and two trade wars later, Mr. Trump is returning to Beijing, where the theme of future dominance, not ancient majesty, has filled domestic and international headlines with articles about dancing robots, drone swarms and…

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How fertilizer shortages caused by the energy crisis threaten food security

How fertilizer shortages caused by the energy crisis threaten food security

Meihua Yang et al write: Since March, war in the Middle East has disrupted global fertilizer markets. Urea prices jumped by nearly 46% in a month, as geopolitical and energy shocks hit nitrogen supply chains. The disruptions caused by blocked maritime bottlenecks, including the Strait of Hormuz, limiting tanker movements and flows of oil and liquefied natural gas, underscore the coupled nature of global energy and food systems. As a result of the crisis, the World Food Programme has warned…

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Gasoline costs 50% more in the U.S. than it did before the Iran war

Gasoline costs 50% more in the U.S. than it did before the Iran war

The Associated Press reports: The price of a gallon of regular gasoline climbed 31 cents in the past week, spiking to an average of $4.48 per gallon Tuesday, according to AAA, hitting the wallets of drivers after rising 50% since the war with Iran began. The main reason drivers are paying more at the pump is because of the global energy crisis caused by the Iran war. The price of crude oil, which is the main ingredient in gasoline, has…

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Congress is doing little to prepare for job losses caused by AI

Congress is doing little to prepare for job losses caused by AI

The New York Times reports: Economists aren’t sure if or when artificial intelligence will cause widespread job losses. But they do agree on one thing: The federal safety net isn’t ready for such a shock. The nearly century-old unemployment system, which provides out-of-work Americans with up to 26 weeks of benefits in most states, is unlikely to cover many of the workers who are most at risk of being displaced by A.I., labor experts warn. Job-retraining programs and other forms…

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Operation Epic Fury, meet Operation Colossal Blunder

Operation Epic Fury, meet Operation Colossal Blunder

Scott Anderson writes: America’s war with Iran has entered a calmer phase: diplomatic posturing, on-and-off-again negotiations and endless wrangling of a settlement. This, of course, is far preferable to the annihilation of Iranian civilization that President Trump was threatening just a few weeks ago. But it raises the question of just what has spurred this turnabout. The answer is rather straightforward. The American and Israeli bombing of Iran failed to provoke either a popular uprising against the regime in Tehran…

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Confusion in Strait of Hormuz leaves shipping firms guessing

Confusion in Strait of Hormuz leaves shipping firms guessing

The New York Times reports: Shipping companies said on Monday that President Trump’s offer to provide them safe passage through the Strait of Hormuz fell short of the sort of arrangements that would persuade them to make the trip. Mr. Trump said on Sunday that the United States would “guide” commercial vessels through the strait, which Iran has effectively closed since the war in the Persian Gulf started two months ago. But the president provided few details on how the…

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After months of debating rate cuts, Fed shifts toward mapping out rate hikes

After months of debating rate cuts, Fed shifts toward mapping out rate hikes

The Wall Street Journal reports: The Federal Reserve’s internal debate over interest rates has turned a corner. Officials are no longer arguing about when to resume cutting. Instead, they are starting to talk about the conditions that would warrant a hike. The shift came further into view on Friday, when three Fed bank presidents released statements explaining why they had objected on Wednesday to language characterizing the central bank’s next likely move as a cut. Depending on how the economy…

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America will pay dearly for its energy arrogance

America will pay dearly for its energy arrogance

Gregory Brew writes: Even if the Strait of Hormuz reopens, markets will remain on edge, waiting to see if Iran closes it once more. Oil coming out of the Gulf will be viewed as more risky — and likely more expensive as a result. Countries will almost certainly rethink their energy security plans and shift their economies away from dependence on imports, including of oil and natural gas. This could prove to have the most profound consequences for the United…

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The last days of Butter Ridge Farm

The last days of Butter Ridge Farm

Eli Saslow writes: Their farm was called Butter Ridge, 326 acres of pastoral valleys and rolling hillsides just south of the New York State border. From his house at the top of the ridge, Brad’s father, Brian, could turn in every direction and see land that his family had once farmed. His grandfather Ivan Watson had run a large dairy operation just to the west, near the Susquehanna River. Ivan’s nine children had all gone on to become dairy farmers,…

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Supreme Leader says Iran is planning for ongoing control of Strait of Hormuz

Supreme Leader says Iran is planning for ongoing control of Strait of Hormuz

The New York Times reports: Iran’s supreme leader issued a rare statement on Thursday saying that the United States had no place in the future of the Persian Gulf region and making clear that his country planned to manage the strategic Strait of Hormuz waterway going forward. In the defiant message, Ayatollah Mojtaba Khamenei also vowed that Iran would retain its nuclear capabilities. The lengthy statement from the Iranian leader, who has not been seen in public since he was…

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Pakistan opens up road trade routes into Iran amid Hormuz blockade

Pakistan opens up road trade routes into Iran amid Hormuz blockade

Al Jazeera reports: Pakistan has opened six overland transit routes for goods destined for Iran, formalising a road corridor through its territory as thousands of containers remain stranded at Karachi port because of the United States blockade of Iranian ports and ships trying to pass through the Strait of Hormuz. The Ministry of Commerce issued the Transit of Goods through Territory of Pakistan Order 2026 on April 25, bringing it into immediate effect. The order allows goods originating from third…

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Demand destruction: How the Iran war could rattle or break the U.S. economy

Demand destruction: How the Iran war could rattle or break the U.S. economy

CNN reports: At its linguistic core, the two-word phrase “demand destruction” feels severe, harsh, maybe even violent. In practice, that’s not far off: It means that the magnitude of a price shock can be so large, so persistent and so painful that spending behaviors shift – sometimes to the point where they permanently alter the course, the structure and the stability of a sector or an entire economy. Earlier this month, the International Energy Agency warned that in the wake…

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