March 6, 2014

In 2011 and 2012, many thought the Euro might break up due to the sovereign debt crisis. Unlike countries that have their own currency, countries in the Eurozone are dependent on the monetary policy of the European Central Bank (ECB). This disconnect makes Euro countries much more vulnerable than other countries to solvency crises. Since, then, however the new chief of the ECB, Mario Draghi, has engaged in a bond-buying program of Outright Monetary Transactions (OMTs) which has helped struggling periphery countries (Spain, Greece, Portugal, Italy, etc) stay solvent.

But while this has lowered interest rates in the struggling countries — and done enough to keep the Euro together — it has not been enough to get Europe out of the woods. Unemployment still remains cataclysmically high in Greece, Spain, Portugal, Italy, and high throughout the Eurozone. And now with inflation rapidly falling, many are worried that Europe is falling into debt deflation. Of course, Europe as a whole is not in deflation yet.

But as Paul Krugman argues, the process is already under way:

I'd say that to have debt deflation — in which falling prices due to a weak economy increase the real burden of debt, which depresses the economy further, and so on — you don't need to have literal deflation. The process begins as soon as you have lower inflation than expected when interest rates were set. It's also noteworthy that inflation rates in the highly indebted countries are all well below the eurozone average, with actual deflation in Greece and near-deflation in the rest. So the debt deflation spiral is in fact well underway. [The New York Times]

Europe's approach throughout the crisis has been to do the very minimum necessary to keep the Euro system afloat. It remains to be seen if that is an approach compatible with an economic recovery anytime soon. John Aziz

6:39 a.m. ET
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In a free-form White House, President Trump's daily intelligence briefing is a rare fixture, often going over the allotted time, The Washington Post reports, basing its profile of "Trump as a consumer of the nation's secrets" on interviews with "several senior administration officials who regularly attend his briefings." Most days, at about 10:30 a.m., "Trump sits behind the historic Resolute desk and, with a fresh Diet Coke fizzing and papers piled high, receives top-secret updates on the world's hot spots," the Post reports. "The president interrupts his briefers with questions but also with random asides. He asks that the top brass of the intelligence community be present, and he demands brevity."

Presidents have received daily intelligence briefings for some 50 years, but every president asks to receive classified intelligence differently. Trump has said publicly he prefers a single page of bullet points, maps, graphs, and other images, which aides say is a reflection of his background with real estate blueprints. CIA Director Mike Pompeo says intelligence analysts produce "killer graphics" for Trump because he likes to "get to the core of the issue quickly." Director of National Intelligence Dan Coats, another Trump appointee, says that sometimes "pictures do say a thousand words." Trump's briefings are "a very oral, interactive discussion," Pompeo adds, and "he asks hard questions, which I think is the sign of a good intelligence consumer."

At the same time, The Washington Post says, "Trump consumes classified intelligence like he does most everything else in life: ravenously and impatiently, eager to ingest glinting nuggets but often indifferent to subtleties." Trump tells aides he takes the briefings very seriously, "yet there are signs that the president may not be retaining all the intelligence he is presented, fully absorbing its nuance, or respecting the sensitivities of the information and how it was gathered." You can read more about Trump's intelligence consumption at The Washington Post. Peter Weber

5:25 a.m. ET

On Sunday evening, President Trump turned to his favorite social media platform to issue an optimistic assessment of the Republican effort to drastically revamp the tax code, presumably along the lines Trump laid out a month ago in a single page of bullet points:

Trump's optimism seems a little misplaced. In reality, The Wall Street Journal's Richard Rubin reports, the GOP's "boldest ideas for changing the nation's tax code are either dead or on political life support, as the Republican effort in Congress to reshape the tax system moves much more slowly than lawmakers and their allies in business had hoped." Rubin explains the basic problem:

Republicans, who control both chambers, are scouring the tax code, searching for ways to offset the deep rate cuts they desire. But their proposals for border adjustment — which would tax imports — and for ending the business interest deduction and making major changes to individual tax breaks for health and retirement have all hit resistance within the party. The only big revenue-raising provision with anything close to Republican consensus is repealing the deduction for state and local taxes, and that idea faces objections from blue-state lawmakers in the party. [The Wall Street Journal]

Taking the border adjustment tax and business interest changes off the table leaves the House GOP plan about $2 trillion in the hole, and "the Trump administration has taken more items off the table," too. Some Republicans are scaling back their lofty ambitions, talking about a temporary tax cut that could pass Senate rules for a simple-majority vote or lowering the corporate tax rate to 25 percent rather than the 20 percent House Republicans envision and the 15 percent Trump has called for.

"Eventually you run out of ways to pay for your promises," says Alan Cole, an economist at the Tax Foundation, which favors lower tax rates. "There aren't any free, obvious sources of money where you can just do the thing and nobody gets mad." You can read more details at The Wall Street Journal. Peter Weber

4:34 a.m. ET
AP Photos/Gillian Flaccus

Portland resident Jeremy Christian will be arraigned Tuesday on at least two counts of aggravated murder for his alleged stabbing of three men on a MAX light-rail train on Friday. Two of the men — Taliesin Myrddin Namkai-Meche, 23, and Rick Best, 53 — died, and a third, David-Cole Fletcher, 21, was wounded and is expected to live. On Monday, The Oregonian's Maxine Bernstein posted a detailed report of the fatal encounter, mostly as recounted by eyewitness Rachel Macy, a 45-year-old passenger on the train.

The man now identified as Christian boarded the eastbound train at the Lloyd Center shopping mall and immediately started "screaming that he was a taxpayer, that colored people were ruining the city, and he had First Amendment rights," then began spewing anti-Muslim slurs, Macy said. "He was just being really belligerent and loud." Best was standing closest to Christian, and was the first to try to calm him down. A train operator said over the loudspeaker that the person causing the disturbance needed to get off at the next stop, threatening to call the police, Macy recalled, and that's when Namkai-Menche stepped up and urged Christian to get off the train.

At some point, someone tried to physically move Christian away from the two teenage girls he was harassing, earning a warning from Christian, Macy told The Oregonian. Namkai-Menche was holding his phone up, either showing Christian something or recording the incident, and Christian knocked the phone away and stabbed him in the neck. "It was just a swift, hard hit," Macy said. "It was a nightmare." She doesn't remember who was stabbed in which order, she said, but Christian left the train after cursing the passengers, Best took a few steps and collapsed, Fletcher stumbled off the train holding his neck, and Namkai-Menche walked by her. Macy tended to him, giving him her tank top to hold against his neck.

Best, an Army veteran, died at the scene, while Namkai-Menche died at the hospital. When he was on the stretcher, Macy said, Namkai-Menche had a final message: "Tell everyone on this train I love them." Read her entire timeline of events, and statements from other witnesses, at The Oregonian. Peter Weber

3:50 a.m. ET
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"If Donald Trump leaves office before four years are up, history will likely show the middle weeks of May 2017 as the turning point," writes Elizabeth Drew, author of a book about Watergate, in The New York Review of Books. His firing of FBI Director James Comey, who was overseeing the main investigation into Russian election-meddling and any ties to the Trump campaign, led to the hiring of former FBI Director Robert Mueller as special counsel. Mueller has already set up shop in a Justice Department building and is building up his staff and working on a budget for what could be a long, painful slog for the Trump White House.

Already, the investigation has reportedly reached the perimeter of the Oval Office, ensnaring Trump's son-in-law and senior adviser, Jared Kushner. "If Trump has nothing to hide, he is certainly jumpy whenever the subject comes up and his evident worry about it has caused him to make some big mistakes," Drew writes, predicting that Trump's "troubles will continue to grow as the investigators keep on investigating and the increasingly appalled leakers keep on leaking." She continues by comparing Trump with Richard Nixon, who she says "was a lot smarter than Trump is" but made some similar mistakes:

Trump, like Nixon, depends on the strength of his core supporters, but unlike Nixon, he can also make use of social media, Fox News, and friendly talk shows to keep them loyal. Cracking Trump's base could be a lot harder than watching Nixon's diminish as he appeared increasingly like a cornered rat, perspiring as he tried to talk his way out of trouble ("I am not a crook") or firing his most loyal aides as if that would fix the situation. Moreover, Trump is, for all his deep flaws, in some ways a cannier politician than Nixon; he knows how to lie to his people to keep them behind him. The critical question is: When, or will, Trump's voters realize that he isn't delivering on his promises, that his health care and tax proposals will help the wealthy at their expense, that he isn't producing the jobs he claims? [Drew, NYRB]

Drew doesn't answer that question, which is likely unknowable. "What is knowable is that an increasingly agitated Donald Trump's hold on the presidency is beginning to slip," she concludes. You can read her entire argument at The New York Review of Books. Peter Weber

2:11 a.m. ET
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Frank Deford, a sportswriter who began his career at Sports Illustrated in 1962 and didn't quit until right before his death on Sunday, was "a dedicated writer and storyteller" who "offered a consistent, compelling voice in print and on radio, reaching beyond scores and statistics to reveal the humanity woven into the games we love," reads his citation for the National Humanities Medal former President Barack Obama awarded him in 2013, the first such honor for a sportswriter. It was one of many awards Deford won over his long career. He died at his home in Key West, Deford's wife, Carol, confirmed on Monday. He was 78.

Benjamin Franklin Deford III was born in Baltimore in 1938, and along with 30-plus years writing for Sports Illustrated he was a regular on HBO's Real Sports and on NPR's Morning Edition, from which he retired only on May 3, after 1,656 commentaries about the human side of sports. Hired as a researcher at Sports Illustrated, he made his bones writing about basketball, hardly a focus of sportswriters in the 1960s.

Deford "understood the particular legacy he had carved out," writes Bryan Curtis at The Ringer. "He would be seen more as a great sportswriter rather than a great writer, full stop. ... And he decided  —  though he was more talented than many writers who pass through the gates of The New Yorker  —  that he was more or less comfortable with the slur." At the same time, Curtis says, "Deford wrote so well it obscured his divining-rod abilities as a reporter. He always seemed to land on just the right quote."

So, a quote from Ross Greenburg, president of HBO Sports in 2004, when he told the Los Angeles Times: "Frank Deford with a pen in his hand is like Michael Jordan with a basketball and Tiger Woods with a driver." And a quote from Deford — who leaves behind a wife, two children, and two grandchildren, having lost a daughter to cystic fibrosis at age 8 — from his 2012 collection Over Time: My Life As a Sportswriter: "I think there are more good sportswriters doing more good sportswriting than ever before. But I also believe that the one thing that's largely gone out is what made sport such fertile literary territory — the characters, the tales, the humor, the pain, what Hollywood calls 'the arc.' That is: stories. We have, all by ourselves, ceded that one neat thing about sport that we owned." Peter Weber

1:55 a.m. ET
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A zookeeper at the Hamerton Zoo in Cambridgeshire, England, was killed Monday after a tiger entered the enclosure she was in and attacked, police said.

The unidentified zookeeper died at the scene. A witness told The Sun zookeepers came running up to the enclosure "with pieces of meat trying to get whatever's attention" and it was "heartbreaking seeing them trying to help." In a statement to visitors, the zoo said the mauling was "a freak accident," and is being investigated. The zoo will be closed through Wednesday. Catherine Garcia

1:37 a.m. ET
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Manuel Noriega, who ruled Panama as a military dictator from 1983 until he was ousted by U.S. troops in 1989, has died, the government of Panama announced early Tuesday. He was 83.

Noriega was in poor health, and after undergoing brain surgery in March, he suffered a brain hemorrhage and was placed in a medically induced coma. Born in Panama City on Feb. 11, 1934, Noriega was a career soldier. Beginning in the late 1950s up until the 1980s, Noriega worked with the CIA, while at the same time trafficking cocaine. He was indicted by the United States in early 1989 on charges of racketeering, laundering drug money, and drug smuggling, and in 1990, after spending 10 days in the Vatican's diplomatic mission in Panama City, he surrendered.

Noriega was convicted and sentenced to 40 years in prison in 1992, and was convicted in absentia of murder and laundering $2.8 million in drug money by purchasing property in France. He was extradited back to Panama in 2011. Catherine Garcia

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