Several US personnel injured in attack on air base in Iraq – National & International News – MON 5Aug2024

Several US personnel injured in attack on air base in Iraq.

Stock market drama after poor US jobs report.

Bangladesh PM flees after deadly protests.

Far-right riots in UK after stabbing.

NATIONAL NEWS

Several US personnel injured in attack on air base in Iraq

At least 5 US personnel were injured in a rocket attack against the Ain al-Asad airbase in Iraq, the US’ largest airbase in the country. One of the five was seriously injured. These figures could increase as a damage assessment is ongoing. 

After President Biden and VP Kamala Harris were briefed on the attack, the White House issued a statement saying they had “discussed the steps we are taking to defend our forces and respond to any attack against our personnel in a manner and place of our choosing”.

Last Tuesday night, the US carried out an attack on a Popular Mobilization Forces base, one of the Iran-backed militant groups in Iraq. This strike killed at least four of their members. Incidentally, this strike took place the same night as Israel’s assassination of Hamas political leader Ismail Haniyeh in Tehran.

Tuesday’s strike by US forces followed a recent resumption of attacks by militant groups against US bases in Iraq (including al-Asad) following a months-long truce. No injuries were reported on those prior attacks on US bases.

As we await a promised retaliation against Israel by Iran and Hezbollah for the assassinations of Haniyeh and Hezbollah commander Fuad Shukur, US troops stationed in Iraq and elsewhere in the region are likely to come under fire.

Click here for the full story (opens in new tab).

Recession or overreaction?: Stock market drama after poor US jobs report

Last week, a disappointing US jobs report triggered a panic in US markets which carried over into global markets today. The Nikkei in Japan had its largest one-day drop since 1987. European markets and the London Stock Exchange also saw precipitous drops, but not nearly as dramatic as Japan. When the US markets opened, the trend continued. The Dow Jones Industrial Average dropped 1,034 points, or 2.6%. The tech-heavy NASDAQ lost 3.4%, and the S&P 500 lost 3%. Losses at the Dow and S&P 500 neared the biggest daily losses since September 2022. While the markets closed significantly down, there was a brief, weak rally at the end of the day.

Sahm’s rule and recession fears

The July jobs report showed the economy added 114,000, falling well short of the 175,000 economists expected. The unemployment rate also ticked up 4.3%, the highest it’s been in nearly three years, and exceeding forecasts by 0.2%. These figures triggered fears of a recession due to what’s called the “Sahm rule”. According to this rule, posed by American economist Claudia Sahm, if the average unemployment rate over three months exceeds the lowest level over the past 12 months by 0.5%, this signals the beginning of a recession.

Taking July’s figures into account, the three-month average for the unemployment rate was 4.1%, while the lowest level over the last year was 3.5%. However, the rule’s creator Claudia Sahm is not convinced that a recession is inevitable. Sahm says this tipping point is an indicator that it’s time to take corrective action.

Corrective action could possibly include the Federal Reserve lowering interest rates. Some economists believe this is overdue anyway, since most of the major central banks in the world have recently lowered theirs. The Fed is due to meet again in September, but some on Wall Street are calling for an emergency meeting. However, this could trigger undue panic and make recession a self-fulfilling prophecy.

What caused the market slide?

Several factors other than the jobs report may have contributed to the market panic. For one, there is the looming prospect of all-out war between Israel and Iran. An all-out conflict in the region could affect oil prices and further hinder trade and shipping through the Red Sea and Suez Canal, as has already been the case over the past 10 months.

The Nikkei crash today seems to have created a domino effect that spread to the other markets. However, there are factors specific to Japan that may have triggered a massive sell-off. Some market watchers have pointed to the possibility that a “carry trade” in Japan is unwinding. This has to do with investors borrowing assets at a low-interest rate and investing in an asset that provides a higher rate of return.

The value of the yen has steadily declined for years as the country experiences deflation, making it attractive to borrow assets in Japan which has low interest rates. This strategy can pay off big, but if the country’s currency suddenly increases in value, or the central bank suddenly increases borrowing rates (as the Bank of Japan did last week), an investor can find themselves unable to pay back what they’ve borrowed. If banks suddenly call in huge loans and borrowers are unable to repay them, this can trigger massive sell-offs. 

Click here for the full story (opens in new tab).

INTERNATIONAL NEWS

Longtime leader of Bangladesh flees after deadly protests

Sheikh Hasina, who has served as Bangladesh’s prime minister for 15 years, has apparently fled the country in a helicopter after weeks of protests against her government. Thousands of protesters stormed her official residence yesterday after clashes between riot police and protesters left 91 people dead. There have been many other flare-ups in recent weeks that killed dozens of people, but Sunday was the deadliest day so far.

General Waker-uz-Zaman, chief of staff of the Bangladeshi army, has promised to oversee an orderly transition into an interim government. Zaman also appealed for calm and called on the leaders of the student protests to restrain their followers. Vandalism continues to be a problem but Zaman has promised the police and military will cease firing on peaceful protesters.

The protests, centered on college campuses and government buildings, began last month in opposition to a controversial civil service quota system. The quota initially reserved 30% of public sector positions for the children and grandchildren of people who fought against the Pakistani military to win Bangladesh’s independence in 1971. Hasina herself was the daughter of Sheikh Mujibur Rahman, a former prime minister who was one of the leaders of the independence movement. The quota also gave preference to certain ethnic minorities and applicants from less developed districts.

A court last month reduced the percentage of public sector jobs reserved for descendants of freedom fighters from 30% to 7%. However the protests continued calling for Hasina’s resignation. This was in response to Hasina ordering a brutal crackdown and comparing the protesters to “terrorists” and those who collaborated with the Pakistani military in the 1970s.

Click here for the full story (opens in new tab).

Click here for more information on Hasina’s political career (opens in new tab).

Nearly 400 arrested in far-right riots in UK after stabbing

Last week, a young man stabbed 3 young girls to death at a Taylor Swift-themed dance event in the seaside town of Southport, which is in Merseyside just north of Wales. The victims were Alice Dasilva Aguiar, 9, Bebe King, 6, and Elsie Dot Stancombe, 7. Several other children and adults were also injured. Police arrested a 17-year-old suspect, now identified as Axel Rudakubana, who was born in Cardiff, Wales, to Rwandan parents.

Due to his age, police were initially barred from publicly identifying the suspect. This led to rumors circulating online which were propagated by far-right influencers such as Andrew Tate and Nigel Farage. Some falsely identified the suspect as being a Muslim asylum seeker who arrived by boat in the UK last year. None of this was true. But the rumors fed into already high anti-Muslim and anti-immigrant sentiment among Britons with far-right sympathies.

Over the past week, there have been riots in Southport, nearby Sunderland as well was in London, Liverpool, Manchester and Northern Island, among other places. Mosques and hostels used to house asylum seekers have been targeted. Muslims, and particularly women who wear hijab, have reported harassment and violence against them, and many are afraid to leave their homes.

Newly-elected Labor Prime Minister Keir Starmer has announced he is mobilizing specialist police units to help local police forces put down riots of “far-right thugs”. Reports have emerged that coordinated attacks are being planned on 40 law centers and immigration centers around the UK.

Click here for the full story (opens in new tab).