24 August 2018 FT — Articles to Read

24 August 2018


Question: According to MSN:Money, what are 10 things you’ll spend more on in retirement?


Banks to lend Riyadh $11bn as Aramco listing stalls – Pg. 1

–          Saudi Arabia’s sovereign wealth fund is primed to choose international banks to lend it $11bn, filing the hole left by the delayed listing of state energy group Saudi Aramco and providing financing for crown prince….

–          The loans are particularly important for the fun after plans to list Saudi Aramco, from which it was due to receive proceeds, were postponed indefinitely

–          Syndicated loans to sovereign wealth funds are unusual, with large Middle Eastern funds, such as the Qatar Investment Authority, typically borrowing against specific investments instead.  As many as 15 banks are expected to participate in the loan

–          The sale, which moves money from one state coffer to another, will have implications for league table rankings that banks use to measure their performance against rivals


Pope faces call to open Vatican archives on clerical child abuse – Pg. 2

–          (Prof Note: I am intentionally not wading into this abyss.  However, and perhaps this is wading, can anyone provide a reasonable explanation as to why the Pope is not in Pennsylvania right now?)


Trump fate hangs on definition of hush money – Pg. 4

–          Michael Cohen, Donald Trump’s longtime personal lawyer, dropped a bombshell this week as he confessed to paying hush money to two women to influence the 2016 election and said Mr Trump told him to do it

–          …Mr Cohen’s admission to two criminal violations of campaign finance law does not leave the president defenseless

–          The bar for criminal prosecutions of campaign finance law is a high one, and it requires prosecutors to show that a person willfully and knowingly violated the law

–          …need to provide evidence that indicated that Mr Trump knew the payments were illegal, but ordered them anyway

–          A civil case brought by the Federal Election Commission would not need to show a violation was willful or knowing,…

–          The highest bar to any criminal prosecution, however, is Mr Trump’s status as president.  Although the constitutions does not explicitly rule out an indictment of a sitting president, some scholars have argue that impeachment is the proper course for holding a president to account.  The Department of Justice endorsed this view in 1973 and again in 2000, when the Office of Legal Counsel issued an opinion arguing that “the indictment or criminal prosecution of a sitting president would impermissibly undermine the capacity of the executive branch to perform its constitutionally assigned functions”


Land reform will sow the seeds of a fairer South Africa – Pg. 9

–          It is nearly 25 years since South Africa became a democracy….

–          One of the areas where this disparity is most devastating is in the ownership of and access to land

–          …the current distribution of land is the second-biggest constraint on poverty reduction and shared prosperity

–          The “land question” goes back more than a century to the 1913 Natives Land Act, which gave legislative form to a process of dispossession that had been under way since colonial times.  It limited the country’s African population to slightly more than 10% of the land, reserving the rest for the white minority

–          Even now, the dispossession of land continues to determine the prospects of millions of South Africans.  And it holds back economic development.  By restricting the ownership of land to a small minority, the apartheid regime ensured that one of the country’s most valuable economic resources would be severely underused

–          …individuals, companies and trusts own 90% of land in South Africa, and the sate 10%.  Of this 90%, individuals own 39%, trusts 31%, companies 25%, and community-based organizations 4%, with co-ownership at 1%

–          The audit also found that 97% of total agricultural holdings are owned by 7% of landowners.

–          The proposal on expropriation without compensation is one element of a broader programme of land reform that seeks to ensure that all citizens can have their land rights recognized


US student debt: Sallie cum laude – Pg. 10

–          …now the gross US student debt balance is tottering $1.5tn or more

–          Only $100bn of that figure was originated by the private sector.  The main lender here, Sallie Mae…

–          Sallie’s annualized default rate is under 3%.  Its return on equity was a whopping 19% in the most recent quarter


Stronger economy gives Powell room for manoeuvre at Jackson Hole – Pg. 17

–          The Atlanta Fed estimates real GDP growth is running at 4.3% for the third quarter, wage pressures are rising, inflation is on target and unemployment is below 4%

–          …the 10-year Treasury yield remains well below 3%, an influence on the cost of US home loans and longer term company borrowing


Answer: (1) Travel; (2) health Care; (3) Utilities; (4) Moving and relocating; (5) Fitness; (6) Day-to-day expenses; (7) Debt; (8) Charitable giving; (9) Reading; (10) Financial Planning