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Michael Heise, chief economist of Allianz SE, says the ECB needs to assure financial markets that the deflation risks in the first half of 2015 are not all negative, as the declining price of oil adds to purchasing power in the eurozone economies. He points out that ECB needs to define price stability not as inflation of "nearly 2%" but as inflation of "below 2%," to take into account the impact of declining oil prices on inflation. His concern is about financial markets expecting strong quantitative easing program from the ECB in 2015.

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Asset reports of Fed governors and candidates for Fed chairman show Ben Bernanke and Daniel Tarullo at the low end of $1-$3 million, Stein, Duke and Yellen at $5-$12 million in the middle, and at the high end are Summers $8-$31 million, and Powell between $17-$40 million.

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China's GDP growth for the second quarter of 2012 was 7.6% from the prior year. China set a target of 7.5% GDP growth in March 2012. About half of the GDP growth in 2011 was generated from investment spending. As part of a new Stimulus China is increasing bank lending and moving forward development projects in energy and infrastructure. Bank loans showed an increase from 793 billion yuan ($124 billion) in May 2012 to 920 billion yuan ($144 billion) in June 2012.

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Voters overwhelmingly oppose the tax increase in 2015 taking the consumption tax from 8% to 10%. The Abe government plans to postpone the tax increase and call snap elections in December 2014. Two thirds of people surveyed said they did not see why new elections are needed. For prime minister Abe this is an effort to win a vote now rather than later when the opposition is weak. In 2012 elections Abe won 295 of 480 seats in the lower house of parliament. LDP party officials say even if this dropped by 20-30 seats it would be a win for Abe reaffirming that his economic policies are taking Japan in the right direction towards growth, and extending the length of his mandate. They point to growth in tourism, and the addition of 1 million new jobs. Further action to stimulate the economy would reduce unemployment further and end Japan's deflationary tendencies.

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Mark Frazier, a professor at the New School, is the author of the book "Socialist Insecurity: Pensions and Politics of Uneven Development in China." Here he describes the situation in China for the elderly and pensions. There is no Social Security Administration in China like the one in the U.S. Pensions are the responsibility of local authorites. Urban pensions were established in 1951. Pensions for rural areas and farmers came only in 2009. The situation in China for pensions is much like that in the U.S. before FDR's New Deal, being run by a patchwork of local programs- about 2500 county and city governments running pension funds. The problems of pension programs being run for the benefit of well connected groups and making risky investments exists in such local programs. Local governments taking on large levels of debt is a serious problem. The pension program in Shanghai came under scrutiny because of risky investments. A report in Dec 2012 cited by Frazer cites empty accounts at 2.2 trillion yuan or $353 billion. The National Social Security Fund has only $140 billion. Overall pensions account for about 3% of GDP in China compared to 4.9% in the U.S....

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Problems with the rural development and agriculture projects conducted by USAID in Afghanistan include overspending in 2009, followed by sharp cutbacks in 2010 and 2011 as budget cuts were made. In 2009 USAID made a grant of $300 million to Arlington based International Relief and Development (IRD) to help farmers in Kandahar and Helmand improve productivity over just one year, at the insistence of Richard Holbrooke. The focus was on paying for day labor jobs to clean canals, offer subsidized seeds to encourage switching from opium poppies, distributing tractors, and building gravel roads. Because many districts of the two provinces were considered unsafe for work, much of the money was concentrated on a few districts and in one year. As a result farmers in Kandahar got more seed than they needed and they in turn sold tons of seed and tractors in Pakistan for cash. A senior program official at IRD says it wasn't realistic to pour so much money in one year. But USAID officials say overspending and poor oversight made the program seriously flawed. There was also a difference in the views of the military and USAID on the value of day jobs. The U.S. military sees this as away of protecting its efforts, of literally protecting its flanks, as this keeps unemployed youth from joining the Taliban. At the same time senior USAID officials wanted to see multiple companies bid for the next $350 millon on a follow-on project. When the USAID team of specialists again awarded it to IRD, senior offficials at USAID decided to cancel the program. The program was then redesigned in the expectation that other companies would bid for it. In the meantime USAID gave IRD 3 quarterly extensions, the last expiring June 30, 2011. The US military sees the day labor program as crucial for its military efforts, so there is kind of an impasse with USAID reluctantly giving in. IRD meantime is shutting down activites in Helmand and will do this also in Kandahar probably by the end of May, as its contract has not been renewed because of problems with the program. USAID has a high staff turnover rate of 85% a year in Kabul which complicates things with the shifting priorities of different officials. Some programs are being scaled back- a job retraining program seen as requiring $125 million over 18 months is being scaled back to $40 million. Others such as a USAID project for coordinating disparate rural rehabilitation projects for $140 million is held back because of lack of agreement with the Afghan government about how it should proceed. In parts of Kandahar USAID had found several contractors doing the same work. See the groups on Dexter Filkins, and on Commander Adams, which touch on serious development issues and the war....

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Difficulties facing China from an overheating economy, a property bubble in many cities,, and a 22.5% jump in March in the broadest measure of money supply being the latest signs of trouble. The government announcement will show the economy growth at 12% rate in the 1st quarter of 2010 vs. 8.7% in 2009. The problem is that China may have acted too aggressively when the central bank increased money supply and state-owned banks in China's centralized banking system were ordered to jack up the lending. The $586 billion stimulus sent even more money to construction and energy companies. Without effective steps and fast the Chinese economy could run into serious problems.

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An inherent division between the two sides about the merits of a large scale involvement- as advocated by a tactical military man McChrystal and the limited involvement advocated by Vice President Biden considering the lack of a reliable Afghan partner - have now spilled out into the open after a compromise was patched together about a year ago. That compromise involved sending more troops but with a deadline for withdrawal set for July 2011. Now as the war reaches a stalemate -as a war of this type in the mountainous terrain of Afghanistan, and as ordinary Afghans see no particular interest in either side in this war, was largely expected to turn out into- the frustration has spilled out into the open. General McChrystal, in an interview with Rolling Stone magazine this Spring, made comments with disdain for Vice President Biden, and an aide to McChrystal called National Security Advisor James Jones , a clown.

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Matteo Renzi, recently elected chief of Italy's ruling Democratic party, is likely to be the next prime minister as current prime minister Letta resigns. Letta's administration had come under increasing criticism from business and public opinion about the slow pace of economic changes in Italy. Italy's 2 trillion debt, or about $2.7 trillion, at 130% of GDP, and the declining GDP with little or no economic growth, is a problem for the eurozone. At the current pace of economic change the IMF forecast estimates only 0.5% annual growth in GDP till 2018. Foreign direct investment 2005-2011 is about one third of the eurozone average, according to the IMF, and Italy has failed to attract foreign investment for the last two decades with its weak political system and lack of competitiveness. By comparison Spain has seen an increase in exports and increasing foreign investment as it positions itself for a recovery. The austerity measures adopted by the Monti and Letta adminstrations in 2011-2013 helped to improve confidence in capital markets and lower borrowing rates, however this is clearly not the answer to Italy's problems of slow or no growth in the economy for the last decade. This is the problem Matteo Renzi, the 39 year old Mayor of Florence, is pushing to tackle as the mood in the country calls for aggressive action. Renzi's economic advisor is Filippo Taddei, who has a doctorate from Columbia University. He says at the core the issues are about what kind of "productive identity" Italy should have. Taxation that promotes higher rates of business investment is needed to promote growth, and creating a business climate that encourages investment in human capital and new technology. Payroll and business taxes take up about two thirds of a company's earnings leaving less for investment. Renzi is planning to take the centre left Democratic party in a new direction, "the road less travelled," as he put it in a televised speech, with innovative solutions including pro-market approach. As a first step he negotiated a deal with former premier Berlusconi for electoral reforms that would give a party or coalition winning electoral support a strong mandate to make and execute policy, without being hobbled in the way previous administrations were in the post war period. Lucrezia Reichlin, former head of research at the ECB, and Lorenzo Bini Smaghi, a former member of the ECB executive council, are candidates to be the economics minister in the Renzi administration....

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Al Maktoum is prime minister of Dubai. He points out some important facts about the Arab world. About half of the 300 million people in the Arab world are under the age of 25. Unemploment is very high among these 150 million Arab youth. About 50% of the jobless are youth, according to the prime minister. About 65 million of the Arabs are illiterate, and 10 million children under the age of 25 are not enrolled in any school. He points out that with so little education, the Arab youth are especially vulnerable to propaganda that creates extremism and is hostile to the west and the USA. One of his key points is that the Arab world is the most militarized place in the world, and spending on conflicts in the Middle East in the last 60 years is about $3 trillion. And in the last 15 years he says the spending on education which is 20% of what the world's 30 wealthiest countries spend, has dropped to 10% of that amount. And very little is being done to educate girls and give them opportunities. As a result of these convictions, Al Maktoum, who is also the ruler of Dubai and from the royal family, has committed about $3 billion to various initiatives to provide schooling to children, especially girls, and education for young people. This makes him one of the more enlightened leaders in the region pushing for new directions. This also reveals the critical weakness among the Arab peoples and why they tend to be so radicalized. Improvements in education and more opportunities for jobless youth, and creating a peaceful region -with the US and the EU countries committing to policies that lead to much diminished military sales to Mideast countries and reducing hostilities in the region -would do more to reduce anti-American sentiment in the region and improve US security than any other policy actions. As Iran, Pakistan and Afghanistan, and the Muslims of India share the same characteristics as the Arab peoples, and the same cultures, the same is true of this region, actually more so. Education has been even worse neglected in the South Asian Muslim region than among the Arabs. It is the key to peace, does more than troops to ensure the peace. The need is for more schools to be built and run in the region, for essential services like healthcare and development, and financing of job creating industries. ...

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In an effort to create a single market India's Modi administration is replacing the multiple federal and state taxes with a single Goods and Service Tax. The bill passed India's parliament on June 30, 2017. It should increase GDP growth by 2%. The taxes are in 4 categories 5%, 12%,18% and 28% depending on the goods and services. Vegetables, some food items and milk are exempted.

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Relations between the U.S. and Argentina improve under the new Macri administration. U.S president Obama visits Argentina in March 2016.

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The investigation into the airstrike by the U.S. on a Pakistani border position inside Afghanistan largely upholds the Pakistani account of events according to the Wall Street Journal.

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Krugman on the dangers that the sharp cuts in spending proposed by the Republicans in Congress- as a solution to the budget impasse- could abort the nascent and fragile recovery in 2011. The impact of higher food and oil prices also affects consumers in 2011-2012.