Most industrial commodities are oversupplied, with the feared slowdown in China only deepening the miners’ woesHow severe is the crisis in the world of over-borrowed big miners? Here’s an illustration. Anglo-American, a company founded in 1917, employing 148,000 people around the world and generating sales last year of almost £20bn, now has a stock market value of £8.7bn.By contrast, Next, the clothing chain with a £4bn turnover, is worth £11bn. Even Whitbread, pumping out Costa Coffees rather than digging for diamonds, coal and iron ore, is within a whisker of Anglo’s market value. Continue reading...

The people behind a manifesto for solving environmental problems through science and technology are intelligent but wrong on their assumptions about farming and urbanisationBeware of simple solutions to complex problems. That is a crucial lesson from history; a lesson that intelligent people in every age keep failing to learn.On Thursday, a group of people who call themselves Ecomodernists launch their manifesto in the UK. The media loves them, not least because some of what they say chimes with dominant political and economic narratives. So you will doubtless be hearing a lot about them.“A growing manufacturing base has long been a crucial way to integrate a large, low skilled population into the formal economy, and increase labour productivity. To grow more food on less land, farming becomes mechanised, relieving agricultural workers of a lifetime of hard physical labour.”“Cities both drive and symbolise the decoupling of humanity from nature, performing far better than rural economies in providing efficiently for material needs while reducing environmental impacts.”“It turns out that while density does equal efficiency, “megacity” does not necessarily equal density. Megacities do encompass those places that we typically associate with dense and culturally vibrant urban centres: New York City, Tokyo, London. But what’s not often taken into account is the fact that to keep them running, these cities also require surrounding areas such as industrial lands, ports, suburbs. In other words, the environmental benefits of a city’s dense urban core can be outweighed by the resource-inefficient, yet essential, areas on its periphery. They are, in fact, two sides of the same coin.”“The long-term evolution of social, economic, political, and technological arrangements in human societies toward vastly improved material well-being, public health, resource productivity, economic integration, shared infrastructure, and personal freedom.”“A word you won’t find in the Ecomodernist Manifesto is inequality. ... There is no sense that processes of modernisation cause any poverty. ... There’s nothing on uneven development, historical cores and peripheries, proletarianisation, colonial land appropriation and the implications of all this for social equality. The ecomodernist solution to poverty is simply more modernisation.“... From ancient Mesopotamia to modern China the evidence is clear: development implies underdevelopment, material wealth implies material poverty, freedom implies slavery and so on. These couplets are not two ends of a historical process, with modernisation ringing the death knell for the misery of the past, but contradictions within the modernisation process itself.” Continue reading...

Paper co-authored by shadow health secretary underlines difficulties facing Jeremy Corbyn with MPs in his administration so at odds with his ideologyVoter distrust of Labour’s use of taxpayers’ money is an existential threat to the party, and members who deny it by claiming the public are against austerity are flying in the face of evidence, according to a pamphlet co-authored by Heidi Alexander, the new shadow health secretary.Liam Byrne, MP for Birmingham Hodge Hill, and Shabana Mahmood, the former shadow Treasury chief secretary who has refused to serve in Jeremy Corbyn’s shadow cabinet, also contributed to the pamphlet. Probably the starkest document yet to emerge from Labour’s election rubble, it underlines how hard it will be for Corbyn to send out a cohesive message when MPs, including those in his administration, are fundamentally opposed to his ideology.Related: Labour housing policy 'must be credible' to win back Tory votersRelated: Can Corbynomics guru Richard Murphy fix Britain? Continue reading...

The Bank’s independence prevents the government being tempted to finance pet projects with money-printingJeremy Corbyn’s proposed “People’s QE” has provoked consternation in the academic and central banking world. Even Mark Carney, governor of the Bank of England, has weighed in, despite the perils of central bankers speaking out on matters of political controversy. PQE has divided opinions in the economic commentariat, but it has united all in getting us extremely hot under the collar.PQE involves the government instructing the Bank of England to print money (or rather, the modern equivalent, creating electronic reserves) to purchase bonds issued by a Corbyn-established National Investment Bank. This NIB would then use the money to fund public infrastructure projects, or, in fact, whatever the government fancied.Related: Modern capitalism needs an opponent. It needs Jeremy Corbyn Continue reading...

Wall Street follows European markets lower, after Chinese slowdown stops US central bank from raising interest rates

America’s central bank announces it will not raise borrowing costs for the first time since the financial crisis began

Federal Reserve rules out any rate rise for at least three months due to global economic uncertaintiesTime for one last drink before the bar closes. Maybe even a couple. That was the message from the Federal Reserve on Thursday as it kept interest rates on hold and appeared to rule out a move for at least the next three months.In truth, the decision by the US central bank was not that much of a surprise, although the soft tone of its comments were. Wall Street had not been primed for a move. Only 30% of market participants thought the Fed would move this month, and this is a central bank which prides itself on its communication skills.