From Ukrainian POWs on trial to more eco-friendly vinyls for your record collection – Here’s your August 25 news briefing
To start off, we’re looking into:
A Ukrainian POW trial spells controversy
For months, the Ukrainian city of Mariupol was under siege, with Ukraine’s national guard attempting to keep Russia away before finally surrendering in May. Hundreds of the national guard’s Azov Regiment’s members have been imprisoned by Russia since then, with the head of the Russian-backed separatist government in Ukraine’s Donetsk region saying they would be put on trial by the end of the summer.
On Tuesday, the UN human rights office said the Russian trial process of Ukrainian prisoners of war (POWs) could amount to a war crime. It reported that it looks like Russian-backed authorities have built metal cages in a hall in Mariupol for a so-called “international tribunal.” Under the Geneva Conventions, the right to a fair trial must be granted to POWs, and the organization has had no access to these Ukrainian POWs. But, the organization has also expressed concerns over the Ukrainian convictions of some Russian POWs.
China’s drought is causing big power problems
For over two months, the southeastern region of China has been undergoing a record-breaking heat wave and drought. Apart from affecting the population’s health and the country’s crops, this weather anomaly is now responsible for an energy crunch. In China, hydroelectricity is the second-biggest power source, so a lack of rainfall poses a big problem. So, China’s been rationing power and slowing down manufacturing to help deal with this lack of water energy.
Now, to make up for the dwindling supply, the Sichuan region is seeking energy from other areas, and the government is calling on local coal miners to ramp up their output. The Sichuan Coal Industry Group has said it’s working more at night to save power, and it’s more than doubled its thermal coal supply. This isn’t enough to cover the energy gap, but China is consuming more coal now than it did last year. Plus, China has also begun to buy coal from other countries (like Russia). The irony of a climate crisis resulting in more coal usage isn’t lost on us.
Biden cancels some student loan debt
Whether you’re an American or not, you’ve probably heard the horror stories about people straddled by student loan debt from their time at a US university. Well, following through on a campaign promise, US President Joe Biden announced a package that will cancel some student loan debt.
On the global scale, the question worth asking is whether or not the move will exacerbate the already historic inflationary pressures in the US right now. On the one hand, economists say that it could increase demand for all sorts of other things, leading to higher inflation rates. But, on the other hand, experts worried about a recession say increasing consumer demand and spending could help.
The Fed has said before that while growth is important to avoid a recession, the main concern right now is inflation – and many worry that this cancellation may increase inflation. The thing is, this student loan cancellation isn’t going to have immediate effects because people usually pay off their loans over time. Plus, the move will also resume student loan payments, meaning money is circulating back in.
To end, we’ll look into:
The problem with vinyls
You may be surprised to hear the vinyl industry is booming despite the shift to music streaming platforms and song downloads. It’s been on an upward swing for a bit now, but 2021 was the first year since 1986 that the industry broke US$1 billion in revenue, a 61% jump from 2020, which was already up from 2019 and so on for the past 15 years, according to the Recording Industry Association of America (RIAA).
But there’s one problem with vinyl – the vinyl. See, vinyl plastic, also known as polyvinyl chloride or PVC, is bad for the environment. Like, bad enough that Greenpeace, the global climate advocacy group, says that it’s the very worst kind of plastic for the environment. When the vinyl industry was dying, no one cared about this problem. But now that it’s making a comeback, it will matter much more.
When dealing with the environmental impact of vinyls, there are two main problems – how they’re made and what they’re made of.
The issue with the process is that the machines used to make vinyls are pretty inefficient when it comes to power usage. Some companies have offset that extra power usage by investing in sustainable energy practices. But a Dutch company called Green Vinyl Records spent the past seven years developing a new type of press that uses up to 90% less energy. Green Vinyl’s owner, Harm Theunisse, thinks it’s the “new standard” for the industry.
The materials issue is a little more complex to solve. Manufacturers use PVC because it sounds the best, and, for vinyl, the sound is debatably the most crucial part. Experts in the industry say that you can use other kinds of plastics if you’re just looking to make a vinyl that looks nice, but if you want something that sounds good, you’re going to have to use PVC.
That is, unless Green Vinyl Records’ new method of using polyethylene terephthalate (PET), a more recyclable type of plastic, works out. Green Vinyl just signed its first big order from Warner Music, so it could be right about the future of vinyl pressing.
The problem with this method? It’s more expensive. But, people in the industry say that if we really want vinyls to have a smaller carbon footprint, we’re going to have to buy the ones that make that wish a reality.
In other news …
📈Stocks: MSCI’s gauge of global stocks was more or less flat, up 0.21% at 2736.01.
- S&P 500 was up 0.29% to 4,140.77.
- Nasdaq climbed 0.41% to 12,431.53.
- Dow Jones gained 0.18% to 32,969.23.
- Hang Seng Index lost 1.2% to 19,268.74.
🧠Some quick factors to bear in mind:
- On Friday (US time), Fed Chair Powell is expected to speak at a three-day conference. Many expect him to say what we all know – “We are committed to our fight against inflation."
- This week’s key reports include jobless claims and a personal consumption expenditure report, which just shows how the average American consumer is spending. This one is a fav for the Fed when it comes to inflation data, giving them a glimpse into the customers’ minds at the shops.
- Investors are yo-yo-ing and betting that the upcoming Fed meeting in September will lead to a rate hike between 50 and 75 basis points.
- Meanwhile, in Hong Kong, stocks fell to a five-month low from supply chain headaches stemming from lockdowns, making it quite hard for Chinese carmaking giants to, well, make cars and money.
- Tensions across the Strait are still simmering, with Taiwan President Tsai Ing-wen warning China earlier this week that the island is determined to defend itself and invaders will incur a “heavy price." This is while Canadian officials are planning to visit the self-governing island in October.
👄Some comments and chatter:
“When the 10-year climbs above 3%, all of a sudden stocks have a harder time. We saw that in May, we saw that in June, we’re seeing it again now. That will be a headwind, as long as the 10-year remains above 3%. The market is gyrating between this ultra, ultra hawkish view and this ultra, ultra dovish view. It’s going to be somewhere in the middle," said Anthony Saglimbene, chief market strategist at Ameriprise Financial in Troy, Michigan.
🛢Oil: Several dynamics are at play; uncertainty around the US’ “final” text of Iran’s nuclear deal (Iran is a crude-oil-rich country), Saudis suggesting OPEC+ cutting its output and central banks fighting inflation. Brent crude settled at US$101.22 a barrel, and US crude settled at US$94.89.
👛Bitcoin: At the time of writing, Bitcoin is at US$21,531.80
😷Hong Kong COVID rise: With COVID cases rising in Hong Kong, officials are again considering tightening the social distancing protocol. With 7,884 new COVID cases reported Wednesday, the city’s healthcare system could be facing strain.
🌀Hong Kong issues typhoon warning: Last night, city weather officials issued the No. 8 signal, which is Hong Kong’s third-highest typhoon warning. Tropical storm Ma-on is on its way toward the city, and the storm warning will be in effect at least until this morning.
⚖Murdoch’s son sues Australian news site: Rupert Murdoch’s son Lachlan Murdoch (the CEO of Fox Corp) filed a defamation lawsuit against an Australian news site. The site in question published an opinion piece suggesting he was complicit in the Jan. 6 attack on the US Capitol building.
🤑Biden announces more Ukrainian aid: Yesterday, US President Biden announced an additional almost US$3 billion in military aid for Ukraine. This money will go toward air defense systems, artillery systems and munitions, drones and other equipment for long-term defense.
🐘Elephant rips handler in half: An elephant in Thailand repeatedly stabbed its handler with its tusks before ripping him in half. The elephant in question was forced to work in the heat, which police claim drove it crazy.
😢Dugong’s extinct in China: A study has found that the dugong is “functionally extinct” in Chinese waters. But, good news – environmental scientist Helene Marsh says that, compared to the rest of the world, dugongs are doing pretty well in Australia. But, their numbers are still at risk.
✈Teen breaks world flight record: 17-year-old Mack Rutherford became the youngest pilot to circle the globe alone in a small plane after flying 30,000 miles by himself. He completed his flight yesterday in Sofia, Bulgaria. He also beat his 19-year-old sister’s record, who was the youngest person (and woman!) ever to fly solo around the world in an ultralight plane. Here’s to some healthy sibling competition.
Written and put together by Jake Shropshire, Vanessa Wolosz, Christine Dulion and Krystal Lai