Summer reading list

24 July 2023

Summer reading list

With the holiday season upon us, this week’s briefing provides our summer reading list of articles designed to offer a distraction from the rigours of travel, leisure or, indeed, of continuing work. Our choices below are free, although some websites may have restrictions on how many articles can be read without charge.

Over the centuries, societies have shifted from one energy source to another in search of cheap, convenient power. This article from the Smithsonian Magazine details how America’s move from burning wood to burning coal in the home ran into a surprising set of objections, including concerns about aesthetics, patriotism and gastronomy. This 19th century energy transition suggests that decarbonisation requires social change as well as different sources of energy. Reading time: 8 minutes.https://www.smithsonianmag.com/innovation/americans-hated-coal-180980342/

India recently surpassed China to become the world’s most populous country and has seen spectacular rates of growth in recent years, lifting hundreds of millions out of poverty. This piece by economist Noah Smith outlines how India’s young population, open economy and scale have set it on a path to superpower status. Reading time: 11 minutes.
https://www.noahpinion.blog/p/herecomesindia
Inflation is starting to wane, in the process bolstering financial markets and economic optimism. But with inflation rates running well above target levels and wages showing strong growth the battle to tame inflation is far from over. This fascinating piece examines how two long-term trends – what author Matthew Klein calls the “green” and “grey” transitions – could keep fuel inflation for years to come. Reading time: 12 minutes.
https://www.vox.com/future-perfect/23717600/high-inflation-cpi-climate-change-population-aging
Many cities are reassessing the role of cars in cities, but few as enthusiastically as Paris’s socialist mayor Anne Hidalgo. In the 1960s and 1970s Parisian planners focussed on accommodating surging car ownership by building new roads and car parks. Now car parks are being closed, public transport is booming and bike lanes are everywhere. Between 2001 and 2018 car use in Paris declined by almost 60%. This piece by the American magazine Slate examines this controversial topic, speaking to its proponents and detractors. Reading time: 28 minutes.
https://slate.com/business/2023/03/paris-car-ban-bikes-cycling-history-france.html

When the Victorians imported Japanese knotweed into the UK they admired its flowers, ability to stabilise sand dunes and feed cattle. Little did they know that the plant would spread to become an expensive menace and cost homeowners dearly. This article by The Guardian long read speaks to the people on the front line of the war against the weed. Reading time: 24 minutes.
https://www.theguardian.com/environment/2023/may/16/the-war-on-japanese-knotweed
Acid rain caused huge damage, to trees, soils, rivers and lakes, though its most visible manifestation is its corrosive effect on stone sculptures. Since the 1990s emissions of sulphur dioxide which cause acid rain have plummeted in what counts as one of the great environmental successes of the modern period. This article examines how a scientific consensus on the damaging effects of acid rain shifted views in government and turned the tide of sulphur dioxide emissions. Reading time: 13 minutes.https://worksinprogress.co/issue/the-end-of-acid-rain

PS: An additional recommendation for holiday listening would be the excellent Green Room podcast created by our colleagues at Deloitte, engaging experts on some of the biggest economic and social questions of the day. Recent episodes have featured guests such as Andy Burnham, mayor of Greater Manchester, talking about what makes a city great, and Bobby Duffy, professor at King's College, examining the usefulness of generational identity (whether millennial or baby boomer) in understanding people's choices and way of work. Here's a link to the latter episode. https://www2.deloitte.com/uk/en/pages/about-deloitte-uk/articles/the-green-room-podcast-episode.html?episode=46#

For the latest charts and data on health and economics, visit our Economics Monitor:
https://www2.deloitte.com/uk/en/pages/finance/articles/covid-19-economics-monitor.html

OUR REVIEW OF LAST WEEK’S NEWS
The UK FTSE 100 equity index closed the week up 3.1% at 7,664. Equities gained last week thanks to positive UK inflation data, which caused market interest rate expectations to fall below 6%.

Economics

UK headline inflation fell to 7.9% in June with core inflation down to 6.9%, both considerably below economists’ expectations
Grocery inflation in the UK fell for a fourth consecutive month, slowing to 14.9% as supermarkets have started to reduce the prices of some items
UK two-year gilts fell below 5% on the back of the positive inflation data as markets expect lower terminal interest rates
Rental inflation in the UK rose to 5.1% in June, the highest level on record, according to the ONS, as higher mortgage interest rates increase rental demand
Retail sale volumes in Great Britain increased by 0.7% in June, much stronger growth than expected as demand shows resilience
UK house prices fell by 0.2% in July, according to Rightmove, as mortgage interest rates continued to rise causing a 12% drop in home sales
UK consumer confidence fell in July, the first decline since January. The drop in confidence reflected the impact of high inflation and rising interest rates
Business insolvencies in the UK rose by 27% in the year to June as businesses struggled with rising costs and a slowing economy
UK banks have passed on higher interest rates to savers more than their European and US counterparts, according to the Financial Times
US banks posted stronger than expected profits in the second quarter bolstered by the effect of high interest rates on interest margins. US bank shares rose almost 6.0% last week
US housing starts unexpectedly slowed in June despite the lack of housing stock which is underpinning house prices
US consumer confidence rose again in June, hitting the highest levels for more than 18 months
Goldman Sachs cut its probability of the US entering a recession in the next 12 months from 25% to 20% on the back of positive economic data
China’s economy grew by 0.8% in Q2 2023, better growth than economists expected but still a considerable slowdown from the 2.2% growth in Q1
Youth unemployment in China has hit a new record high of 21.3% in urban areas
Russia’s central bank unexpectedly increased interest rates by one percentage point to 8.5% on expectations of higher inflation
Japan’s inflation hit 3.3% adding pressure on the Bank of Japan’s ultra-loose monetary policy stance

Business

United Airlines and easyJet increased their earnings guidance for 2023 due to better than anticipated international travel demand as the tourism industry continues to outperform
Netflix added more than 6m subscribers after its password-sharing crackdown, well above analysts' expectations
Tesla reported that its profit margin had fallen to the lowest level in four years following a series of price cuts designed to sustain sales
Tata Group announced that it will build a $4bn battery factory in the UK to supply Jaguar Land Rover’s electric cars, after securing state aid from the British government
Life insurer Just Group reported more than a doubling in retirement income sales in the first half of the year, as soaring gilt yields fuel corporate pension deals and the sale of individual annuities
UK food manufacturer Premier Foods announced that it does not plan to increase prices any further this year, in a sign of easing food inflation
The FT reported a surge in the number of foreign students paying higher fees at the UK’s top universities squeezing places available for home students
UK care home operators warned that higher mortgage rates and delay to government reforms risks insolvencies in the sector

Global and political developments

Russian security services arrested pro-war critic Igor Girkin under the allegations of extremism
The private military company Wagner will shut its main training base in Russia by the end of the month
US climate envoy John Kerry announced that the US and China agreed to resume talks over the climate crisis
A US nuclear submarine arrived in South Korea for the first time since the 1980s as part of the new bilateral agreement between the two countries
A US official confirmed that a US soldier is being held in North Korea after crossing the inter-Korean border into the northern territory
The US National Security Council spokesperson John Kirby criticised Russia’s exit from the Black Sea grain deal as it would “exacerbate food scarcity and harm millions of vulnerable people around the world”
In the UK, the Labour Party won two out of the three parliamentary by-elections held last Thursday with the Conservative Party holding on to ex-PM Boris Johnson’s constituency
Labour leader Sir Keir Starmer said London mayor Sadiq Khan needs to “reflect” on his plan to extend London’s ultra-low emission zone as the Times reported that senior shadow cabinet ministers blamed the planned extension of the zone for Labour’s unexpected failure to win the Uxbridge and South Ruislip by-election

And finally… scientists noticed young dolphins chewing and passing on puffer fish to one another. They believe this technique is used by the mammals to enter a trance-like state as the fish contains a narcotic toxin – puff the magic fish

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