- China’s Swelling Local Debt Adds Urgency to Xi Fiscal Repair Job. China’s local-government debt swelled to 17.9 trillion yuan ($2.95 trillion), underscoring risks to the financial system as President Xi Jinping rolls out economic reforms. Debt including contingent liabilities rose about 13 percent in the six months through June, based on figures in a report by the National Audit Office, posted on its website yesterday. That followed a 48 percent increase over the previous two years. China’s borrowing spree in recent years has evoked comparisons to debt surges that tipped Asian nations into crisis in the late 1990s and preceded Japan’s lost decades. The audit result adds pressure for Xi, yesterday named head of a Communist Party leading group for reform, to repair a fiscal system that starves local governments of tax revenue.
- China’s Xi Amassing Most Power Since Deng Raises Risk for Reform. Xi Jinping today completes his first year as China’s leader with the greatest individual sway over his nation since Deng Xiaoping, a feat that raises the stakes on delivering on pledges for economic and social change.
- China Says Abe Closed Door to Meetings After Visiting Shrine. China ruled out talking to Japanese Prime Minister Shinzo Abe, saying he “closed the door” to any meetings with Chinese leaders after visiting a site that memorializes fallen Japanese soldiers including war criminals. “Chinese people don’t welcome him,” Foreign Ministry spokesman Qin Gang said at a briefing in Beijing today. “What Abe needs to do now is confess his mistakes to the Chinese government and the Chinese people.”
- Europe Stocks Decline. Swatch Group AG, the world’s largest watchmaker, lost 0.8 percent after a fire caused damage at one of its workshops. International Personal Finance Plc (IPF) rallied 10 percent after Numis Securities Ltd. recommended buying the stock following a 26 percent drop in the past two days. Vedanta Resources Plc increased 4 percent after its Sesa Sterlite Ltd. won approval to restart its iron-ore mines in Karnataka, India. The Stoxx 600 slipped 0.2 percent to 327.13 at the close of trading in London.
- Natural Gas Advances on Forecasts for Cold Start to New Year. Natural gas advanced in New York on speculation that an unusually cold start to the new year will stoke demand for the heating fuel. Gas gained as much as 2.4 percent as Commodity Weather Group LLC predicted a push of below-normal temperatures into the Northeast, Midwest and South through Jan. 8. The high in New York City on Jan. 3 will be 18 degrees Fahrenheit (minus 8 Celsius), 21 below normal, according to AccuWeather Inc. The low in Chicago on Jan. 2 will drop to 6 degrees, 13 below normal, and Dallas will be 31 degrees, 6 lower than average, according to AccuWeather in State College, Pennsylvania.
- Second Blast in Russia Stokes Olympic Security Fears. Suicide Bombing Is Volgograd's Second Within 24 Hours. A suicide bomber struck in the southwest Russian city of Volgograd on Monday morning, killing at least 14 people aboard a crowded trolley bus in the city's second terrorist attack in less than 24 hours, stoking security fears in the country ahead of the Winter Olympics. Russian President Vladimir Putin ordered security to be tightened around the country after the second attack, which comes less than six weeks before the games are set to start in the Black Sea resort of Sochi. The repeated attacks, and risk of additional violence, threaten to tarnish an event on which Mr. Putin has staked his personal pride and spent $50 billion to stage.
- Chinese Funds Look to Hedge Their Bets. Chinese funds focused on the nation's domestic stocks are increasingly looking to hedge their bets. While short selling, or betting that a stock's price will fall, remains uncommon in China because of the high cost of borrowing stocks, hedge funds are using CSI-300 index futures and other methods to limit their risk. And fund managers say they expect regulators to roll out more products that will allow them to better hedge in the future. "More and more [local] funds are using hedging strategies" to protect themselves during market declines, said Martin Bao, assistant portfolio manager at Shanghai-based Broadvision Investment Management.
- 'Stuck in our own experiment': Leader of trapped team insists polar ice is melting. The leader of a scientific expedition whose ship remains stranded in Antarctic ice says the team, which set out to prove climate change, is "stuck in our own experiment." But Chris Turney, a professor of climate change at Australia’s University of New South Wales, said it was “silly” to suggest he and 73 others aboard the MV Akademic Shokalskiy were trapped in ice they’d sought to prove had melted. He remained adamant that sea ice is melting, even as the boat remained trapped in frozen seas.
- Drones, placentas and transgender students: New laws in 2014 cover much ground. You may have heard that Colorado residents will be able to legally buy pot next year. But did you know that in Oregon, mothers will be able to take their placentas home after giving birth? And in Illinois, it will be illegal for police to use a surveillance drone in most cases without a warrant. These are just a few of the thousands of new laws and regulations going into effect next year -- mostly on Wednesday.
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- Schaeuble Says Low-Rate Policies Can't Last Forever. German Finance Minister Wolfgang Schaeuble in Bild-Zeitung interview says "low-interest rate policies of the central banks can't last forever." Schaeuble says expansive monetary polices lead to problems for long-term investments.
- China to Keep Child Policy, Birth Level Stable. China will keep child policy stable and ensure that birth level won't be volatile, citing a statement from the State Council on improving child policy. China will seek to manage the imbalance proportion of newborns' gender and strictly control births thta aren't in accordance with policy.
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