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EconVue Spotlight

Dear R. Hunter,

The automotive industry is a useful lens to view trends in the world
economy. The auto story has it all- global competition, labor,
automation, innovation, energy, commodities, and the sharing economy. In
the US, the sector has struggled. EconVue expert Michael Lewis's
comments

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct1_1/1?sid=TV2%3A88pHaUyob

on industry data were published Friday. Sales in the US are likely to
fall to 17M vehicles this year.

The future could be brighter. Last week I attended the annual symposium
on the automotive industry hosted by the Chicago Fed in Detroit. The
impact of autonomous electric vehicles (AEV) on fuel prices, labor
mobility, real estate, infrastructure, and society itself is complicated
and impossible to forecast. One counterintuitive takeaway: Baby Boomers
might adopt AEV's faster than Generation Z. Now 25% of the US
population, Gen Z (ages 5-22) will soon be one- third, surpassing Baby
Boomers and Millennials.

While global economic data including interest rates and low inflation
seem to be converging, economists such as Raghuram Rajan identify a
political trend in the opposite direction, divergence. Citizens who see
themselves as left behind by globalization are pushing decision making
to local levels, uncomfortable with rule making too far removed. Brexit
of course is an example of this trend, as is the US repudiation of the
Paris agreement on climate change.

On Saturday, World Environment Day, I visited the Chicago Botanic
Garden. A record crowd attended their events, and I am confident that
local efforts to protect the environment have been spurred to greater
action. Don't count the US out on climate change.

Finally, congratulations to one of our original EconVue experts Richard
Katz

https://econvue.com/experts/richard-katz

, who has taken a sabbatical to write a book on the role of start-ups in
the Japanese economy, and this week was named a senior fellow at the
Carnegie Council.

STORIES IN OUR SPOTLIGHT

Automotive

Mapped: the top 263 companies racing toward autonomous cars

https://www.wired.com/2017/05/mapped-top-263-companies-racing-toward-autonomous-cars/?utm_content=buffer8c5cd&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

Jack Stewart 5/10/2017 Wired

Forget dot coms and social networks. The hotspot for research and
investment in Silicon Valley right now is the future of transport.

The country adopting electric vehicles faster than anywhere else

https://www.bloomberg.com/news/articles/2017-06-01/the-country-adopting-electric-vehicles-faster-than-anywhere-else

Matthew Campbell 5/31/2017 Bloomberg

Norway, whose economy is built on oil, has the greatest penetration of
electric vehicles.

There are now 31 companies with #autonomous vehicle testing
permit in #California?

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct5_1/1?sid=TV2%3A88pHaUyob

Guidaautonoma 6/2/2017 Twitter

A list of companies that have been issued permits for self-driving
vehicles.

Chinese automakers launch a global offensive via emerging Asia

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct6_1/1?sid=TV2%3A88pHaUyob

Hiroshi Kotani, 6/1/2017 Nikkei Asian Review

To get an idea of just how dramatically Asia's auto industry is
changing, one need only look at Southeast Asia and India, where Chinese
newcomers are looking to make inroads even as traditional heavyweights
bow out.

U. S.

Fixing America's roads & bridges: the path forward

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct7_1/1?sid=TV2%3A88pHaUyob

R. Richard Geddes & Thomas J. Madison, Jr. 6/2017 Committee for Economic
Development

Absent fiscal stimulus, how do needed infrastructure repairs get funded?
This week the Trump Administration is expected to announce its
infrastructure plan, including accelerating the permitting process.

Can the CFSBC activity index nowcast U.S. real GDP growth?

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct8_1/1?sid=TV2%3A88pHaUyob

Thomas Walstrum 6/2017 Federal Reserve Bank of Chicago

So far so good for the Chicago Fed Survey of Business Conditions.

Macroeconomic effects of Medicare

http://www.nber.org/papers/w23389.pdf

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct10_1/1?sid=TV2%3A88pHaUyob

National Bureau of Economic Research 5/2017

What are macro effects of eliminating Medicare? It provides insurance
for 52m, is 17.3% fed spending (3.6% of GDP)?

t's not just China: Here's who could benefit from Trump's exit from the
Paris deal

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct11_1/1?sid=TV2%3A88pHaUyob

Huileng Tan 6/1/2017 CNBC

However, it's still too early to call a new international order, said
Philippe Le Corre, a fellow at The Brookings Institution. "I don't
believe this is a redistribution of cards with a new international order
under the banner of China and the EU," Le Corre told CNBC's " Squawk Box

http://www.cnbc.com/asia-squawk-box/

," adding that he didn't believe China's international relationships
would see major shifts.

World

Interview with Larry Summers by David Wessel

https://www.brookings.edu/articles/secular-stagnation-even-truer-today-larry-summers-says/

Brookings May 25, 2017

Larry Summers has "doubled down" on his view that the US is stuck in a
period of secular stagnation. Summers has been right, since he made that
statement two years ago, that interest rates, growth, and inflation have
remained low and in fact seem to be converging worldwide.

Understanding global trends in long-run real interest rates

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct14_1/1?sid=TV2%3A88pHaUyob

Kei-Mu Yi , Jing Zhang 6/2017 Federal Reserve Bank of Chicago

Low for longer. Global convergence in growth rates, interest and
inflation.

Watch cyberwar in real-time on this live map

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct15_1/1?sid=TV2%3A88pHaUyob

Jeff Desjardins 5/21/2017 Visual Capitalist

Today's most active battlefield is not located on the ground, in the
air, or on the mighty seas. It's taking place on the Internet.

Attacks on soft targets likely get worse

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct16_1/1?sid=TV2%3A88pHaUyob

Jessica Stern 5/23/2017 Boston Globe

Attacks on soft targets likely to increase says terrorism expert Jessica
Stern. She has been sadly proven right given this weekend's events in
London.

Can monetary policy solve China's soaring leverage?

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct17_1/1?sid=TV2%3A88pHaUyob

Ran Li 5/31/2017 East Asia Forum

The effects and efficacy of monetary policy are "blurred due to
SOE-related distortions". Interest rates don't matter if credit is
obligatory and loans might never be repaid.

Rethinking the next China

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct18_1/1?sid=TV2%3A88pHaUyob

Stephen Roach 5/25/2017 Project Syndicate

Unbalanced rebalancing. With profound implications, especially for Asia.
Roach says that China has failed to launch consumption and is turning
once again to production.

Can President Macron revive the Franco-German engine of European
integration?

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct19_1/1?sid=TV2%3A88pHaUyob

Tim Congdon 5/29/2017 Institute of International Monetary Research
(Video)

Towards a European fiscal union. Can Macron revive the Franco-German
engine of integration? Tim Congdon thinks not.

3 ways to make rich Africa work for poor Africans

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct20_1/1?sid=TV2%3A88pHaUyob

Elsie S. Kanza 4/26/2017 World Economic Forum

70% of Africans access mobile technology. The CFTA allows visa-free
travel in Africa, and all of this could pull many out of poverty.

Boeing's Iran deal Puts Trump in tough spot

http://content.davidhaleweb.com/acton/ct/3037/s-01d6-1706/Bct/l-sf-cl-701C0000000UEmJIAW-0024/l-sf-cl-701C0000000UEmJIAW-0024:15c/ct21_1/1?sid=TV2%3A88pHaUyob

Jessica Holzer 5/26/2017 Foreign Policy

120,000 skilled jobs are at stake

EconVue Research

Data Round-Up: May Jobs Report All-But-Ensures June Rate Hike

http://Data Round-Up: May Jobs Report All-But-Ensures June Rate Hike

Mike Lewis

https://econvue.com/experts/michael-lewis

In May, vehicle sales were 16.6 mm units (seasonally-adjusted at annual
rate). This was essentially the same as in March/April, and all three
months were well below their year-ago analogs. Excuses for this
performance – late income tax refunds, lack of usual wear-and-tear
during the mild winter – are wearing thin. FMI still expects some
firming in the second half. Nonetheless, it appears that, after selling
a record near-17.5 mm units in both 2015 and 2016, automakers will
likely move only about 17 mm new vehicles in 2017 .

Chinese Advances and Setbacks in Colombia

https://econvue.com/pulse/chinese-advances-and-setbacks-colombia

R. Evan Ellis

https://econvue.com/experts/r-evan-ellis

As Chinese companies, backed by the resources of Chinese banks, continue
to learn about and adapt to the Colombian environment, they will
doubtlessly become ever more effective in competing for public projects
and commercial markets, including making better use of local partners,
consultants, and employees.

Suite Française

https://econvue.com/pulse/suite-francaise

Karim Pakravan

https://econvue.com/experts/karim-pakravan

Macron's first ventures on the international scene (the NATO Summit and
the G-7 meeting in Taormina) strengthened his position at home and in
Europe. This said, Macron will have a very short honeymoon. The French
public is famously conservative and resistant to change.

"Mystical Millennials"

https://econvue.com/pulse/mystical-millennials

Collin Canright

https://econvue.com/experts/collin-canright

"The Mystical Millennials are overly romanticized," said Vic Pascucci,
managing partner at VC firm Lightbank. Panelists at Morningstar's New
York FinTech Forum, agreed that FinTech services are overly focused on
Millennials, with a tendency to focus on FinTech products over consumer
experience.

With all best wishes,


Lyric Hughes Hale

Editor-in-Chief

Econvue.com
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