China surpasses US as world’s largest economy based on key measure

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China has surpassed the US in terms of GDP based on purchasing power parity (PPP), becoming the largest in the world by this measure, International Monetary Fund estimates show.

In 2014 China reached $17.6 trillion or 16.48 percent of the world’s purchasing-power-adjusted GDP, while the US made slightly less, 16.28 percent or $17.4 trillion, the FT reported citing IMF data.

PPP is recognized as the best way to compare the size of economies rather than using volatile exchange rates, which rarely reflect the true cost of goods and services. Thus a trillion US dollars are worth a lot more in China than in the US.

On the purchasing power basis, China is overtaking the US right about now and becoming the world’s biggest economy, according to the forecast.

The US has been the global leader since overtaking the UK in 1872. Most economists previously thought China would pull ahead in 2019.

According to IMF estimates, in 2015 the gap between China and the US will increase to almost a trillion dollars: Chinese GDP PPP will amount to $19.23 trillion against $18.286 trillion in the US.

However in terms of a real GDP the United States remains the undisputed world leader with $16.8 trillion output, significantly outpacing China with $10.4 trillion.

11 Important Headlines From the Past Week That Are Not About 2016, Fence Jumpers or Ebola

By Katrina Jorgensen 22 hours ago

IJ Review brings you “just the facts” from the top international headlines of last week, in 11 quick, easy-to-read bits.
1) ISIS Beheads Aid Worker

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The Islamic State has continued its campaign of fear by beheading Alan Henning, a British humanitarian aid worker. The terrorists have also threatened the life of American Peter Kassig, another aid provider.
Kassig’s family responded with a YouTube video asking ISIS to spare their son’s life, and encouraging the world to pray for Henning’s family and everyone held captive including their son.
A new report from the UN about the Islamic State says massive human rights crimes have been committed by the organization. At least 26,000 Iraqis have died this year.
2) Brazil’s Election Outcome Uncertain
Dilma Rousseff receives Presidential sash
Dilma Rousseff receives Presidential sash
Brazilians are heading to the polls today in one of the most exciting elections of the year. President Dilma Rousseff has faced a tough race from dark horse candidate and environmentalist Marina Silva, who suddenly began winning voters in August when she joined the race.
But just yesterday a poll showed Aecio Neves, a former governor, ahead of [correction] Silva in the polls. A run-off between Rousseff and one of these opponents is expected.
3) Bulgarians Head to the Polls Today
Boyko Borisov, former PM of Bulgaria may win again this weekend
Boyko Borisov, former PM of Bulgaria may win again this weekend
Bulgaria has parliamentary elections today. A transitional government has been in place since fall 2013, due to political gridlock and tough economic issues. The center-right GERB party is expected to win, putting former prime minister Boyko Borisov back in charge.
Borisov resigned in February 2013 due to massive anti-corruption protests. Then a socialist-led government took over, but also resigned in August of last year.
4) Palestine Seeks Greater Recognition at Israel’s Expense
The U.S. still does not recognize Palestine as a state at the UN.
The U.S. still does not recognize Palestine as a state at the UN.
The Palestinians have drafted a U.N. resolution that is not formalized yet, but would end what the resolution calls the Israeli occupation by 2016. The UN Security Council would need to unanimously approve the resolution.
Additionally, this week Sweden became the first EU country to recognize Palestine as a state and has begun pressuring other EU countries, particularly the UK, to follow suit. Israel has summoned the Swedish envoy over the issue.
5) Russia Ends Student Exchange with U.S.
FLEX (Future Leaders Exchange) has given thousands of students in Eurasia the opportunity to visit the U.S.
FLEX (Future Leaders Exchange) has given thousands of students in Eurasia the opportunity to visit the U.S.
The Kremlin has halted a student exchange program that sends Russian high-schoolers to the U.S. for a year. The Kremlin claimed they wanted to stop the influence of homosexual couples that applied to act as guardians.
More than 8,000 Russian students have participated in the program in the last 21 years. Alumni of the program and students hoping to be selected have protested the move. The U.S. has expressed disappointment in Moscow’s decision.
6) New Opposition for Putin
The guilt verdict against Mikhail Khodorkovsky in 2005 was more than 600 pages long
The guilt verdict against Mikhail Khodorkovsky in 2005 was more than 600 pages long
New on the scene in internal Russian politics, former Russian oil-tycoon Mikhail Khodorkovsky has announced plan to lead an anti-Kremlin movement. Khodorkovsky was pardoned by Putin after spending 8 years in prison for what is seen as trumped-up charges connected to privatizing his business.
7) Suicide Boming in the Capital of Chechnya
Grozny, the capital of Chechnya
Grozny, the capital of Chechnya
Grozny, the capital of Russia’s Chechnya, celebrated its 196th “City Day” today. But the celebration was marred by a suicide bomber, who blew himself up when questioned by police outside of a concert venue. Four police officers were killed and four more wounded in the explosion.
Chechnya has a history of violence and Islamic terrorism but the current Moscow-backed leader has sought to crack down on militants. The last, major suicide attack happened in 2011.
8) Latvia’s Center-Right Coalition Retains Power
Laimdota Straujuma will stay as Prime Minister of Latvia
Laimdota Straujuma will stay as Prime Minister of Latvia
After elections this weekend, Latvia’s center-right coalition government has managed to retain power. However, Harmony, a pro-Russia party still has significant power, winning 24 seats in the Latvian parliament. Harmony is made up of mostly ethnic Russians favoring closer ties with Moscow.
9) Syria’s Border Towns Under Heavy Attack
Anti-Assad demonsration in Kobani
Anti-Assad demonstration in Kobani
As the U.S. and allies turn their air power on the ISIS militants in Syria, the city of Kobani has been under heavy attack from all sides. Kobani is only one of many Syrian cities experiencing increased violence, but the city’s unique location on the edge of Turkey makes it militarily significant.
Kobani has been defended on the ground by Kurdish forces and bombed from the air by Americans and British, but has remained under siege by the Islamic State. Turkey has recently made promises to work against the militants on the border, despite threats from Syria’s President Assad.
10) Ukraine’s Ceasefire Fails to Hold
ViceNews reports on non-Ukrainian fighters in Donetsk
ViceNews reports on non-Ukrainian fighters in Donetsk
Pro-Russian separatists have made a renewed effort to take back the government-held airport in Donetsk. Twelve have died in clashes over the weekend as the ceasefire continues to be broken. On Friday, Ukraine’s government accused Russia of helping the separatists in the most recent assault on the areas.
11) Hong Kong Protests Still Ongoing
Protest in Hong Kong being nicknamed the Umbrella Revolution
Protest in Hong Kong being nicknamed the Umbrella Revolution
After a week of protests that halted both government and business in Hong Kong, protesters continue to stand their ground, seeking greater independence from China through democracy. Both protesters and the government have expressed a willingness to start a dialogue, but neither side will agree to the other’s preconditions.
Hong Kong’s Chief Executive C.Y. Leung has ordered the protesters to disperse by Monday. The protesters have been calling for his resignation.

RUSSIA, IRAN TO BOYCOTT US DOLLAR IN BILATERAL TRADE

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Russia and China also agreed to trade with each other using the ruble and yuan

by WORLD BULLETIN | OCTOBER 2, 2014

The move away from the U.S. dollar is yet another reaction to Western sanctions placed on Russia since it annexed Crimea from Ukraine in March.

Russia and Iran have agreed to use their own national currencies in bilateral trade transactions rather than the U.S. dollar.

Iran’s IRNA news agency reported that the plans were announced in a meeting on Tuesday in Tehran by Iranian business magnate and head of the Iran-Russia Joint Chamber of Commerce, Asadollah Asgaroladi.

An original agreement to trade in rials and rubles was made earlier this month in a meeting between Russian Energy Minister Alexander Novak and Iranian Oil Minister Bijan Namdar Zanganeh.

Similarly, Russia and China also agreed to trade with each other using the ruble and yuan in early September, following a Russian deal with North Korea in June to trade in rubles.

The move away from the U.S. dollar is yet another reaction to Western sanctions placed on Russia since it annexed Crimea from Ukraine in March.

In response to sanctions on Russia by the European Union, Russia has also threatened to cut off Europes gas supply and close its air space to European airlines. Russia has also boycotted European food imports, in a move likely to affect farmers in the EU.

US STOCKS SINK ANEW AMID HONG KONG PROTESTS

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U.S. stocks went on a roller-coaster ride last week

Adam Shell and Kim Hjelmgaard 1:28 p.m. EDT September 29, 2014

U.S. stocks opened sharply lower Monday on worries over pro-democracy protests in Hong Kong. The Hang Sang Index is down nearly 2%, falling to its worst level since July. Newslook

Pro-democracy protests in Hong Kong are spooking Wall Street Monday, as U.S. stocks continued their recent run of volatility, with the Dow dropping triple digits in early trading, tracking the nearly 2% drop overnight in Hong Kong amid concerns over China’s move to limit reforms in the Asian financial hub.

Stocks pared early losses and were off their lows in afternoon trading. The Dow Jones industrial average was down about 75 points, or 0.4%, to 17,040 after being down more than 170 points in early trading.

The Standard & Poor’s 500 index dropped 0.4% and the Nasdaq composite index fell 0.3%, but both of those indexes were also well off their lows of the session.

The Hong Kong protest is the latest geopolitical flare-up to get Wall Street’s attention, and cause investors to pare back their risk-taking. U.S. stocks went on a roller-coaster ride last week and has been dogged by global uncertainty in Iraq, Syria and the Ukraine. The stock market has also been victimized by profit-taking in recent days as investors react to a market that hit fresh record highs a little more than a week ago, but which has since seen the market’s upward momentum stall.

The protests in Hong Kong drew a tough response from police who declared them “illegal” and used tear gas after pepper spray and warnings of greater force failed to disperse demonstrators trying to join a sit-in outside the government headquarters.

USATODAY
Hong Kong democracy protesters defy calls to disperse
Hong Kong’s Hang Seng index fell 449.20 points, or 1.9%, to 23,229.21. Stocks in mainland China, however, were slightly higher, with the Shanghai composite index up 0.4%. Asian stock markets were mixed elsewhere as Japan’s Nikkei 225 index rose 0.5% to 16,310.64.

The stock market, which had been a sea of calm, has suddenly turned into a scary roller-coaster ride.The Dow opened down more than 100 points today, extending its string of price moves of 100 points or more to a sixth session.

The market has been extremely volatile in the past week or so, and investors were rattled to start the week by the demonstrations in Hong Kong that began Sunday and had investors wondering if a repeat of the Tiananmen Square protests in spring 1989 was brewing.

VOLATILITY: New normal? Dow dips of 100-plus points

FLASHBACK: ’89 Tiananmen Sq. protest did not sink U.S. stocks

It is important to note that U.S. stocks were not upended by the high-profile street protests back in Beijing back in 1989. In fact the index rose 8% from the unofficial start of the Tiananmen Square uprising on April 15, 1989, until June 4, 1989, the day the government crackdown intensified and resulted in deaths, USA TODAY research shows.

If the Dow finishes down — or up — by more than 100 points today, it will mark the first triple-digit point move of six days or more since an eight-session streak from June 11 to June 20 of 2013. That decline was exacerbated by a so-called “taper tantrum,” as U.S. investors reacted negatively to the earliest hints that the Federal Reserve would begin to pare back its bond-buying program. The Fed started to pull back on asset purchases this January and are slated to phase out quantitative easing, or QE, next month.

The Hong Kong Stock Exchange is the fifth largest in the world, when measured by the market value of the companies listed on the exchange, according to the World Federation of Exchanges, citing data through the end of August. (WFE data does not include the London Stock Exchange.) The Hong Kong exchange has a market cap of $3.4 trillion. Only the New York Stock Exchange ($19.3 trillion), the Nasdaq Stock Market ($6.8 trillion), and the Japan Exchange Group and Euronext are bigger.

European shares were trading lower as Germany’s DAX index dropped 0.7% and France’s CAC 40 fell 0.8%. Britain’s FTSE index was only down 0.04%.

Friday, stocks rallied as traders reacted to news of the fastest economic growth since 2011 as the final reading on gross domestic product for the second quarter was revised up to 4.6% from the previous estimate of 4.2%.

​Illegal, but fit to serve: Pentagon to recruit undocumented immigrants

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The Pentagon is to start recruiting undocumented immigrants who came into the US as minors and possess valuable skills like speaking Persian and Chinese. The program offering the opportunity is capped at 1,500 recruits per year.

The new policy revealed by the DoD on Thursday expands the existing pilot program called Military Accessions Vital to National Interest, or MAVNI. It has been tried since 2008, offering positions in the US armed forces to foreigners living in America legally as refugees or under a temporary visa.

Starting next fiscal year, MAVNI will also apply to illegal residents who came to US with their parents before age 16, reports the Military Times. The potential recruits would be selected from those eligible for the 2012 Obama administration policy known as Deferred Action for Child Arrivals, or DACA. Getting a DACA illegal immigrant status involves a background check by the Homeland Security Department.

The Pentagon recruits some 5,000 foreigners each year, most of them ‘green card’ holders. The MAVNI program may account for up to 1,500 recruits annually, although the military services are not required to accept them. In practice the Army has been the only service to accept a significant number, while the Navy and Marine Corps are not seeking applicants under it.

A recruit must meet higher-than-usual standards and have certain skills valued by the US military to get a position. Those include medical training and language expertise. Speakers of Arabic, Chinese, Pushtu, Korean, Russian, Urdu, Hindi and Hungarian are among those in demand.

The expansion of the program to illegal residents adds between 1.2 million and 2.1 million children, teenagers and young adults to the potential talent pool. The recruits would be offered an expedited path to US citizenship as an extra incentive to serve.

But some Pentagon officials have doubt over the number of recruits who would actually qualify for the MAVNI program.

“We’re just not sure how many within that existing population of DACA would have the linguistic skills to qualify,” said one defense official familiar with the policy change. “These are kids who entered the country at a fairly young age and have basically grown up in the United States, so the limit of their language talents would probably be the language that they received at home.”

The Pentagon’s move is part of a wider effort by the Obama administration to ease pressure on immigrants and integrate them into American society. It comes amid frustration in the White House with the failure of Congress to pass a substantial immigration reform.