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With a 6% decline in sales in Europe expected for 2012, the problems at GM's Opel operations are expected to worsen. GM's sales in Europe declined by 2% in 2011. Critics say GM has not give enough attention to Opel's operations. Giving it only an afterthought after being overwhelmed by problems in the U.S. operations, and mostly using the design expertise of its engineering center in Russelheim, near Frankfurt. The Buick Regal is based on the Opel Insignia and the work of Opel engineers. Ferdinand Duddenhoffer, professor at the University of Duisburg-Essen, Germany, says GM has neglected Opel and is not making good use of the manufacturing capacity at Opel. The problem, he says is production management and being able to shift quickly to different models based on demand, and using Opel as part of a global factory network. The repeated restructurings at Opel for 15 years have left this problem unresolved. In his view GM is still in the Middle Ages in this respect.

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The Social Democrats leader Sigmar Gabriel is Economics Minister in the coalition government of Angela Merkel in Germany. He is sympathetic to French premier Manuel Valls effort to reduce austerity in the 2015 French budget now being reviewed by Brussels. Here he takes the initiative to call for discussion on the issue of growth and austerity facing the European Union, by joining French Economics minister Emmanuel Macron in asking two economists Pisani-Ferry and Enderlein at the Berlin Institute of Governance for advice on generating growth. The process started in late summer with the defeat of the centre right government in Sweden which supported Merkel's strict austerity policies for balanced budgets. The elections to the European parliament showed the dire situation facing Cameron in Britain and Hollande in France with the unpopularity of austerity policies, higher taxes and cutbacks. The Socialist Hollande government has the lowest public opinion ratings of any postwar government in France, at 18%, and it is unwilling to go further down the road with austerity. At the same time Valls has found a partner in Italy with the growing popularity of Matteo Renzi in Italy who won 40% of the vote in Italy for the EU parliamentary elections of 2014. ECB president Mario Draghi, has generated the debate by saying at a October 2014 Brookings Institution conference in Washington D.C. that countries that have fiscal space (referring to Germany) should use it. He added that governments that did not take action in the economic crisis facing the eurozone of no growth will be swept away by public opinion. IMF president Lagarde, a former French Finance Minister under Sarkozy, has also questioned policy of strict austerity. For the first time since the start of the eurozone crisis in 2010 there is an opportunity for open discussion on future policies for renewal in the eurozone....

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Some of the statements on the IMF Blog on Inclusive Growth raises the question-Does the IMF, the International Monetary Fund, as an American institution funding developing countries, and economists, grasp what people find troubling in 2022? One of the lessons of the economic crises for families and workers in the US and other countries is that wisdom, a grasp of the soul of a country and its people through the thinking of its founders, and common sense, should drive managing of economies, with a knowledge of how economies work- not economists. Some of that is already happening. America's central bank is headed by Jerome Powell who has wide experience and has knowledge of how the economy runs, is not an economist. He was chosen by president Trump and continues to have the confidence of president Biden for this very reason. Some of the statements on the IMF economic blog are- "Why jobs are plentiful and workers are scarce" Jan 2022 "In the US and UK recent labor market the puzzle, can be partly explained by mismatch, the pandemic's effect on women and older workers leaving the work force." The Reality Wages for teachers are depressed compared to workers in the financial and economics industries, in a frighteningly disproportionate way. When it comes to logistics, hospitality, leisure and restaurants industries workers were paid poorly for what is hard work and long days. In case the IMF economists, and economists at companies, missed this it was called the Great Resignation, people simply choosing to reject the conditions that were handed down to them by the financial industry and economists who built the economic structures of recent decades. Women leaving the workforce are faced with issues of mental health coping with added responsibilities of children at home for the two years, loss of income and widespread mental health problems. The word mental health may be beyond the grasp of economists and the financial industry, yet it is the one of the biggest problems for people. Another pernicious effect noted on the pages of the WSJ is that young white men are dropping out after school because they cannot afford college in alarming numbers. Leading to the kind of discontent for workers and families that president Biden is struggling to address. On IMF Blog- "IMF Podcasts: The Year in Review" Dec. 2021 "The past year has brought us new challenges even as the old ones persist. If anything, the ongoing pandemic has taught us to think differently abut tackling the challenges and questions when it comes to thinking about big issues such as climate change, gender equality, inflation and economic measurement." The Reality Climate change lumped in with economic measurement and inflation. The floods, fires, river and reservoir water levels affecting access to basic life supporting water, drought, all over the world are of a magnitude that is missed entirely.The response to a challenge of this type requires the kind of leadership that president Biden has provided for the world with his $360 billion climate change bill as just the first step of many, and  comprehensive policies covering all aspects of the climate crisis. ON IMF bog- "How Domestic Violence is a Threat to Economic Development." "Stopping violence against women is not only a moral imperative, new evidence shows it can help the economy." The Reality Domestic violence hurts children growing up in such households. It is not so much a moral imperative as it is bad for men, women and children. So many things are wrong about it and it is made worse in conditions of low wages and poor working conditions in poor neighborhoods lacking education. These neighborhoods are also affected by lack of healthcare and the opioid crisis and mental health issues. Not investing in education and healthcare in these communities is what is simply wrong, and which the founders of America as a nation, particularly Lincoln, would find appalling.   Relationship between Capital (the Financial Industry) and Labor (Workers and Families) On the basic issue of the relationship between capital and labor, the IMF and the financial industry, economists, and the economic structure they built in recent decades, have simply got it wrong. It violates both common sense and wisdom, and violates the spirit of the founders particularly Abraham Lincoln. This is what Abraham Lincoln had to say on Upward Mobility, the ease with which each generation can do better than the one before it, as critical in the fight to save the Union. This is from the Annual Message to Congress Dec. 3, 1861, at the start of the Civil War. That upward mobility has been lost in the US with ideas that "place capital on an equal if not above labor, in the structure of government," for the last three decades in the US after the early post war period of Truman and Eisenhower, Kennedy-Johnson.  And Lincoln says this about a hired laborer being fixed in that condition for life, or of future generations of that hired laborer facing disabilities and burdens, similar to the loss of upward mobility for the people today. "Now there is no such relation between capital and labor as assumed, nor is there any such thing as a free man being fixed for life in the condition of a hired laborer. Both these assumptions are false, and all inferences based on them are groundless." "Labor is prior to, and independent of capital. Capital is only the fruit of labor, and could never have existed, if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration. Capital has its rights, which are worthy of protection as any other rights." "Again: there is not, of necessity, any such thing as the free hired laborer being fixed to that condition for life. Many independent men everywhere in these states, a few years back in their lives, were hired laborers. The prudent penniless beginner in the world, labors for wages awhile, saves a surplus with which to buy tools or land for himself, then labors on his own account another while, and at length hires another new beginner to help him. This is the just, and generous, and prosperous system, which opens the way to all- gives hope to all, and consequent energy, and progress, and improvement of condition to all." Lincoln even offers this warning- No men living are more worthy to be trusted than those who toil up from poverty- none less inclined to take, or touch, aught which they have not honestly earned. Let them beware of surrendering a political power which they already possess, and which if surrendered, will surely be used to close the door of advancement against such as they, and to fix new disabilities and burdens upon them, till all of liberty shall be lost." US president Biden has these ideas in mind as he struggles with one piece of legislation after another to restore what once was, to open the door of advancement, to remove these disabilities and burdens that Lincoln speaks of, and in so doing restoring liberty.   ...

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The Adventures of Amir Hamza is a story much like the Odyssey but set in the Persian, Central Asia Islamic world. It was born as far back as the 9th century. It has a South Asian version since the epic is retold in different settings and has a oral tradition of being recited by dastangos who used to recite these myths and legends . Amir Hamza is supposedly the uncle of the prophet Mohammed. Its South Asian version is in the Hamzanama that was commisssioned with painted manuscripts by the Mughal emperor Akbar. It has 1400 illustrations and formed the basis of Mughal art which was a fusion of the artistic worlds of Hindu India and Islamic Persia and Central Asia. In those times the Persian speaking world extended from Tabriz to Hyderabad in south of India and the Hamza Adventures were told around campfires and in the outdoors. The Hamzanama paintings commissioned by Akbar were shown at the Sackler Gallery around the time of the Iraq invasion in the summer of 2002 and show a world long forgotten. The Saudi type of Wahhabi Islam and religious zealotry is a far cry from this more open world of art and legend and life in central, south and western Asia, of commerce, trade and ways of life intermingled and flow of people across a large region in Asia. What it may suggest is that the current wave of religious zealotry is a kind of phase that like a passing wind comes and then is dispersed, maybe its a reaction to western interventions, maybe a failed response of tradition with modernization, maybe something else, a clinging to old outmoded patterns in areas that are most left behind by change, with ethnic and other strife mixed in with it. No single or simple response to it makes sense and a lot of patience is needed. Conflict of civilizations talk and the like may simply be overdone and way oversimplified things....

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Oil prices are up and staying there longer in December 2011. The 12 month rolling average for oil prices for Brent crude oil is at $109, compared to $106 a barrel in September 2008, according to consultants JBC Energy. The situation is worse for eurozone countries because of the declining value of the euro estimated at between $1.16-$1.30 in 2012 depending on how the eurozone crisis is handled. The 12 month rolling average was 70 euros when Brent crude prices were at their high in 2008, compared to 78 euros today. France and Italy are seeing their current account surplus disappear with reduced exports and higher import bill for oil.

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GM and Peugeot Citroen are in talks for sharing the cost of developing new engines and other costs. GM and Citroen Peugeot face declining sales and intense price competition in the European market. With declining sales in Europe there is a need to reduce capacity. GM showed a $747 million loss for Europe in 2011. Peugeot Citroen's automotive division showed a loss of 92 million euros in 2011. A decline of 3-5% is expected in European car sales for 2012.

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Demand from China and the Middle East alone will increase by about 2 million barrels a day this year, with another 2 million barrels a day increase from other growing economies, the U.S., Europe and Japan not changing much. This will drive prices according to the International Energy Agency. Supply is not growing enough, consider Iraq, Iran, Venezuela, Mexico, which have stagnant production levels and increasing demand. Price volatility has been a feature of oil markets with so much uncertainty, including uncertainty of non-OPEC production so that OPEC alone cannot determine oil price levels. Economic crises in the the US and Europe and prospects of a recession have so far not affected oil prices. If demand continues to grow in places like India, China and the Middle East, then prices will continue to remain high.

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Turkey is reviving its relations with Saudi Arabia and the UAE. Prince Bin Salman will visit Turkey as part of a remake of Turkey Saudi relations. Turkey's economic crisis has revived the relationship as Turkey badly needs aid for its economy. The pressure on emerging markets is increasing with US central bank raising rates reducing inflows of western money into Turkey even further. Prince Salman has already received visits from French and British leaders. He visited Jordan and Egypt this week and will now be in Ankara. In the summer he will visit Greece and Cyprus. Saudis are modernizing their economy changing culture in relationships of men and women, in women's rights and education, and broadening relationships with the world under Salman. There is an astonishing openness to science and technology in a drive to be modern. The old Saudi monarchy and conservative rule with ancient traditions is giving way to what the Saudis in the group under Salman see as the modernization of Europe and America in the 20th century using science and technology as what they would like to see in their own country. There is also a drive to think independently from the dogmatic positions of the past that have turned the Kingdom into an American dependency with no obligation or incentive to modernize its culture and be open to the world outside.  The US fought a war to ostensibly modernize a backward mountainous remote state as Afghanistan, while being perfectly comfortable with the old Saudi monarchies of the past that made little change in the ancient culture and tradition and in women's rights and education. Such were the contradictions in American policy and the failure to think anew. As president Lincoln said "as our case is new we must think anew, and act anew." President Biden will now visit Saudi Arabia to build a new relationship with an independent nation, which along with the UAE is bringing change to the Middle East through infrastructure development and modernization. Salman's modernization comes as the kingdom also faced a need to make a transition out of dependence on fossil fuels. Salman sees trips to Greece and Turkey as opening up to all sides. Saudis have good relations with Israel and Egypt another part of this openness. The US senses this, India has sensed this. India's Modi government  made sending the Oxford vaccines manufactured in India to Saudis a priority during 2021. The Indian example is also changing the way the UAE and Saudis see infrastructure development and modernization in the region. This is also changing the way the region is looking at itself. For decades Egypt lacking the resources to build infrastructure on its own has languished economically. A helping hand from the Saudis is changing Egypt. The entire rail system is being modernized with the latest technology from Siemens. The Saudis have stabilized the Egyptian economy with a $5 billion deposit in the Central Bank of Egypt. On June 21 Egypt and Saudis signed $7.7 billion in investment deals for infrastructure, logistics, port administration, food, industry, medicine, energy and technology. In the investments in Egypt some of the oil money going to Saudis with $100 per barrel oil price is going to an economy in Egypt that can easily absorb and make good use of the investment to modernize.   The influence of Saudi leverage in fossil fuels which drove the US relationship with Saudis since FDR is being replaced with an independent Saudi kingdom making decisions to modernize across the board in all aspects compared to one that favored a few American companies such as Exxon Mobil and ARAMCO or arms makers such as Boeing and Lockheed that helped recycle American money going to pay for Saudi fossil fuels back to America.    ...

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Political activism and grassroots efforts- other than street protests - are increasing in eurozone countries facing high unemployment and austerity cuts. The focus is on cleaning up the political system rife with cronyism, corruption and wasteful spending. Brat and Bjork describe one such effort in the town of Torrelodones, Spain, 18 miles from Madrid. Criminal investigations in many Spanish cities have increased public awareness and participation in local government. European Social Survey based in London, reports political activity of this kind in Spain jumped from 27% in 2008 to 39% in 2010. There is an increasing sense that the political elites of the two main parties, the Partido Popular and the Socialists have failed to bring clean government and transparency to Spain. As a result progressives are joining conservatives in an effort to clean up years of wasteful spending, cronyism and corruption in government. The Union for Progress and Democracy, representing an alliance of such groups would win 13% of the vote in a national election, and the ruling conservative Partido Popular would lose half of its support and get only 22.5%, according to independent Spanish polling firm Metroscopia. The new push for transparency is one of the welcome changes at a time of austerity cuts and 27% unemployment in Spain. Many of the perks of public officials such as chaeuffer driven cars and police escorts, contracts for favored few at higher prices, are out in many cities, and accounts made public for scrutiny and change. Transparency International's transparency index shows 33 out of 110 of Spain's biggest cities scoring top grades on the 2012 index, jumping from only one. Following the example of the regional government in Navarra, the central government is drafting the first open-records law. Castilla-La Mancha, the area around Toledo, run by a clean government advocate Maria Dolores de Cospedal from the Partido Popular has taken aggressive steps to clean up the local government and wasteful spending- see the link to Castilla La Mancha. Her long term approach is to clean up government spending and accounts with the idea of preserving spending where it is most needed, in education, healthcare and vital services hit by cuts, an approach being taken in other Spanish cities. ...

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Niall Ferguson, a history professor at Harvard, and Moritz Shularick, a economic history professor at the Free University of Berlin, coined the term Chimerica, to describe the Chinese export machine and the American overconsumption right down to negative savings. Now they call it an economic monster that needs to be given a burial. It does little good for America. For America its a 10-10 deal the authors say, 10% growth for China and 10% unemployment int the USA. The mood in the USA is no longer to go on with this arrangement they warn, and ask that the Obama administration take steps to end this arrangement. The USA should ask China to make a 30 % depreciation of the renminbi say Ferguson and Schularick. Krugman makes a similiar point and warns of dire consequences in aworld out of balance on the same page of the NYT, see the link. Ferguson and Schularick point out that unlike China, both Germany and Japan let their currencies appreciate by 60% for Germany and 50% in Japan, at a similiar period in their country's development. China's renmibi is pegged at 6.83 renminbi to the dollar, and China's government used $300 billion in reserves to keep the renminbi from appreciating this year. Throughout the 1980's and 1990's it was pegged at around 8.28 renminbi to the dollar. For the USA this has been very costly, with a distortion in the global cost of capital significantly reducing long term interest rates, and helping create the real estate bubble in the US. They point out that with Japan and Germany dollar reserves increased roughly in line with growth of American GDP at about 1% and stable before moving slighltly higher in the 1970's. By contrast China's reserves have grown from about 1% of Ameica's GDP in 2000 or $165 billion to 5% in 2005 and 10% in 2008 and headed for 12% in 2009 end. This is simply unsustainable any longer; carrying on any longer risks China losing the very basis of its economic success which is the open global trading system....

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Bernanke's speech at the annual Fed Jackson Hole meeting put any future policy action off for the September meeting of the Fed's Open Market Committee, which will meet for 2 days to allow lengthy discussion of issues. He repeated his focus made in earlier statements that other actions are needed to reduce the headwinds facing the U.S., actions other than the Fed's monetary policy. He called for "good, proactive housing policy," which has been a major missing piece in the jigsaw puzzle of the American economy. Specifically, "families with mortgage debt bigger than the value of their homes facing unusual financial hardship which is also hurting the banks." Martin Feldstein and other experts have repeatedly called for action to help homeowners under water since the mortgage financial crisis hit in 2008. And the government's response has been tepid at best. Most evaluations of the Home Affordable Modification program and other programs to help prevent foreclosures consider them a serious failure of the Obama administration. Higher unemployment has only increased the urgency for government action in this area and good proposals were made by Feldstein and other experts. On the deficit and debt issues Bernanke would like to see debt to GDP ratios "at least stable, or preferably, declining over time." He also cautions that this be done bearing in mind "the fragility of the current economic recovery." He says his estimate for the U.S. economy's growth rate is 0.7% annual rate for the second half, and 'looks likely to improve." His prediction is for inflation to settle at around 2%. His main concern is that the there will be "an erosion of skills and loss of attachment to the labor force" for the long term unemployed....

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U.S. Federal Reserve chairman Ben Bernanke's speech at the annual Jackson Hole conference in August 2011.

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Cook and Olson look at how U.S. shale oil firms have handled the slump in oil prices. Their report in WSJ says the shale firms have weathered the oil slump well, with production declines in 2016 of only 535,000 barrels a day compared to 2015. The Saudi decision to not cut production and let oil prices drop has affected mostly higher cost less flexible production for mega projects such as deep water projects and oil sands in Canada. Oil shale firms are expected to snap back, according to experts, as demand increases. U.S. production is expected to increase by about 700,000 barrels a day by end of of 2017, say experts.

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Jim Krane of the Judge Business School at Cambridge University, points to an important development- the increasing consumption of oil in Saudi Arabia that is shrinking its ability to be a reserve supplier in the Middle East when a Iraq, a Kuwait or a Libya's oil supplies are cutoff. Saudi population and industry is growing and is using up a quarter of its oil production. Consumption is at 3 million barrels a day, more than the oil consumed in Germany, and is growing at 10% a year. Use of oil is subsidized by the government and with social spending up in Arab countries a cut in subsidies is not expected anytime soon. Projections by Jadwa Investment of Riyadh show that the reserve margin will disappear by 2020. By 2038 Chatham House in London predicts Saudi Arabia will become an importer of oil. This is important because America's sanctions against oil imports from Iran require the Saudis to step up and act as the reserve supplier. This happened with Libya, and 1.5 million barrels a day were cutoff after the revolution. Iran exports 2.2 million barrels a day. This will keep supplies tight and keep pressure on oil prices in 2012-2013....

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The Chinese market for mobile phones has seen Chinese companies use their advantages of knowing local requirements and better distribution systems, especially in the rural areas and second tier cities, to establish a presence. By 2004 companies such as Bird and TCL made significant gains. Bird planned to take on overseas markets and take 8% of the global market. Ningbo Bird and TCL then had half the Chinese market. According to analysts this effort fizzled out and these two companies had sales decreasing as larger companies like Nokia started going into the smaller cities and rural areas. Now another company is using its knowledge of the special features desired by Chinese buyers and its distribution system in rural areas and smaller cities to establish a presence. Tianyu, better known by its K-Touch product introduced in 2005, started as a handset contract manufacturing company. Tianyu offers locally desired features not offered by makers like Nokia and Samsung- dual SIM card option popular because it allows keeping second generation phone numbers and accounts while keeping open the option for a 3-G line, bigger text for older users, text messages read aloud, touch screens, receiving phone calls for two numbers, and so on. And Tianyu does this for less than $200, a price that Nokia and Samsung can't match for features like touch screen. Comparison of the K-Touch E62 with a Taiwanese handset called HTC Magic using Android, both touch screen, showed a price for HTC Magic three times the K-Touch E62. The K-Touch E62 cost 798 yuan or $117. Does Tianyu rely too much on the cultural aspect of today's China which is described as "shanzai"? The meaning of this term "mountain stronghold" and has a defiant tone of local culture and tendencies fighting centralized control. It is often used to refer to the cheap knockoffs of imported products that are readily available in China. In the long run analysts believe that the larger Chinese players in telecom, Huawei and ZTE, which have smartphones appealing to Chinese consumers and 3-G technology, are more likely to have a sustained presence. ...

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For passengers air travel nowadays is travelling on planes that are often totally booked. This is because airlines are cutting flights. And with fewer passengers after the economic crisis hit, airlines are having a difficult time cutting flights enough to meet the continuing drop in the number of passengers. Before the crisis business and international travel was a good source of revenue, now this is fading as there is more competition on transatlantic routes with about 50 airlines offering flights between US cities and European cities. The liberalization of air travel between the two continents with the 2007 "open skies" agreement is keeping downward pressure on prices. The International Air Transport Association says the number of passengers travelling on business and first class tickets between N. America and Europe was down 18.4% in April 2009, compared with same month in 2008. Traffic between N. America and Asia was down 26%, for the same period. This is hitting Lufthansa ansd KLM-Air France hard, but is helping Easyjet, Ryanair, and Air Berlin. As demand drops airlines will continue to cut capacity, and this will be done by cutting the number of flights on a route and using smaller planes. After all this capacity cutting takes place by September, OAG Aviation estimates that the seats on domestic flights will drop to 66.5 million from a peak of 84 million in 2001, a drop of 21%. Some airlines which rely less on corporate travellers will not see as steep a drop. These airlines are Southwest, JetBlue and AirTran. Airlines that may not survive the effects of the economic crisis, with tight credit and drop in air travel, and volatile oil prices, are United Airlines and US Airways. United relied heavily on corporate and trans-Pacific fliers before the economic crisis. Fitrch Ratings cites this in reducing the credit rating for United to junk status, as well as the heavy debt maturities in 2009 and 2010. In June 2009 United raised $175 million by issuing new debt, but at an interest rate of 17%. At US Airways the combined airline with America West after a$1.5 billion merger is struggling. It has the thinnest cash position of any airline according to a Morningstar research analyst, and may need further borrowing to meet debt payments. With all assets already mortgaged US Airways may have little borrowing capability left....

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The truth is very different from the rhetoric coming from the Obama administration about helping Main Street America and ordinary workers against "fat-cat bankers," says Goldfarb. Under the Obama administration banks have grown larger and gained more influence over administration decisions. No conditions were made part of the agreement that would require banks to lend a portion of the money handed out to the banks to ordinary borrowers. And not much of significance was done to help homeowners under water, which would enable a faster recovery. In this respect the policies slanted in favor of banks of the Obama administration worsened the prospects of an economic recovery. Experts from Reagan advisor Martin Feldstein- who as early as 2008 advocated serious help to homeowners under water to reduce principal and interest- to the FDIC's Sheila Bair and Princeton Prof. Krugman, across the ideological spectrum, perceived this being in the national interest. Feldstein's first op-ed on his plan appeared in the Wall Street Journal on 3/7/2008, followed by ones on 4/15/2008, 10/4/2008, 1/20/2010/ 10/12/2011 in WSJ, and a oped on 10/30/2008 in the Washington Post, repeating the call for siginificant debt reduction to homeowners. Banks had extraordinary influence on successive administrations in the U.S., both Republican and Democratic- the Clinton, Bush and Obama administrations- so that policy actions could be distorted from what would otherwise take place. A study by two University of Michigan professors shows that banks did not increase lending after receiving government money. Instead taxpayer money was used to invest in risky securities for profits from short term price movements, resulting in gains of about 10% in investment returns. Ran Duchin, one of the two professors, says helping ordinary borrowers was not the most profitable use of capital for banks. Without the necessary conditions from the Obama administration, the banks depolyed capital in ways that did not help the economy. Similiarly when banks needed to be restructured no preparatory action was taken because of resistance within the administration- a request by President Obama to Treasury Secretary Geithner for preparing a plan for the restructuring of Citigroup was ignored, according to a report by Goldfarb and Wallsten on 9/17/2011 in the Washington Post....

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A couple of things can be noted about the burgeoning Chinese market for cars. Most car buyers are first time buyers. But that is to be expected as China started with a small bases of cars to begin with. What is interesting about these first time car buyers is that they ask a lot of questions do their research and are looking for the best car for the money in terms of features, safety, reliability. So its also a sophisticated first time buyer that carmakers are dealing with. This car buyer is also looking at waiting to save enough to buy a better car as far up the ladder as the car buyer can go in terms of features and value in safety, reliability, design, even if this means waiting longer and saving for longer periods.In this sense the Asian car buyer may be different and less bent on instant gratification to get into a 4 wheeled vehicle. What this is doing is putting the domestic manufacturers under a lot of pressure to match the overseas manufacturers. Geely and Cherry the larger domestic makers have to come up with just as good or better a product to get new customers. At this time the overseas makers of cars like the Buick Excelle, the Toyota Camry and the Volkswagen Jetta have the advantage as they are established brnads. Its interesting to compare this with the experience of japan the other large Asian carmarket. In Japan Toyota, Nissan and Honda were the only carmakes available because of trade barriers in the Japanese market in postwar Japan. China is a relatively open market and China's approach seems to be to get the Chinese carmakers to do better in an intensely competitive market as opposed to giving them favorable treatment. Another aspect of this first time car buying in a country where car sales have increased eight fold since 2000 and now exceed sales in the Japanese market, is that this market is abit precarious as the example of the Li family shows. Li Rifu purchased a Geely for $9000 but later after he contracted cancer and had $40,000 in medical bills had to sell the car. China has no social safety net so that if there is a medical or other emergency or crisis in the family there is nothing to fall back on and the family ends up selling the car to pay for expenses....

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Dallas Fed president, Richard Fisher, says the Fed cannot create jobs, and why he is opposed to the Bernanke quantitative easing policy.