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China's current account surplus has declined to 2.8% of GDP for 2011 from about 10% in 2007, and will be around 2.3% of GDP in 2012, according to IMF estimates. The U.S. current account deficit is down to 3.1% of GDP from 5.1%. By controlling the exchange rate China was able to keep the competitiveness of its exports, resulting in a five fold increase in exports from 2000 to 2010, according to the IMF. The decline could be temporary say experts, as the the recession in Europe and the U.S. resulted in slowing exports, with its infrastructure buildup sucking in imports of machinery and other goods from the western countries at an accelerated pace with its 2009 stimulus measures. Another reason is that in the last decade China has developed its own high tech and other companies which will now increase exports. IMF forecasts show a pickup in China's trade surplus to 4.25% by 2017. This could be lower if the renminbi is allowed to appreciate. Estimates of appreciation of the renminbi are 8 percent in nominal terms since June 2010 against the dollar. Including inflation, which is higher in China, the renminbi has appreciated by 13% since June 2010. ...

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Government GDP figures show the GDP shrank by 1.8% in the third quarter of 2016 compared to the same period in 2015, the first such contraction in the economy since 2009. Household consumption was down 3.2%. The sharp decline in the value of the lira by 20% in 2016 makes imports costlier, in an economy dependent on consumption spending and tourism for higher GDP growth. Political uncertainty with instability in Turkey following a crackdown on opposition and media also leads to decline in foreign investment and investment by domestic firms.

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Krugman cites Apple as the largest company in the U.S. in terms of its valuation but having only 43,000 employees in the U.S. He asks the question- why does Apple get most of its manufacturing done in China? Apple indirectly employs about 700,000 people at its suppliers, with most of them in China. Companies contribute to a country's economy by creating successful clusters of research, innovation and manufacturing. In Apple's case, to the great detriment of the U.S. economy, the manufacturing part is being done entirely overseas. If cost is the only factor for this, then the question remains how German manufacturing has managed to surivive and grow with wages that are higher than in the U.S.

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U.S. president Trump's Asia tour has only increased the confusion after his Twitter comments and transactional diplomacy, which has not conveyed a clear strategy. Much of the media commentary talks about the loss of American prestige as a result. Varghese points out in the Hindu newspaper that Mr. Trump has actually dropped the idea of American leadership in Asia, and "Indo-Pacific" dream does not mean much in the context of Trump's wavering statements, and ideas about the U.S. cutting its own deals in each place.

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Walt Mossberg, who writes the Wall Street Journal's consumer technology review section, watched Steve Jobs up-close over the years since 1997. They met one-on-one for product introductions, long discussions about the industry, and recently after Jobs illness, at his home in Palo Alto. Mossberg describes a long walk to a nearby park after Jobs had undergone a liver transplant. It provided an insight into the man Steve Jobs was. Persistent- he called Mossberg for 4-5 straight weekends during the dark days of 1997-1998 to convey his vision of Apple products or discuss aspects of reviews. Patience and optimism about the future- Jobs always maintained a positive tone and a vision of what could be in the digital revolution, and Apple's role in it in these discussions. There is the opening of the first retail store in the Washington D.C. area, and Jobs patiently handles Mossberg's incredulity about Apple and its inexperience with retail stores. And Jobs saying that he had taken a serious interest in the details- down to the translucency of the glass. There is the meeting with Bill Gates at the fifth All Things Digital Conference, when both made their appearance together for the first time and Jobs hands a cold bottle of water to Gates. By this time Jobs had already come to the conclusion- as he once said after accepting a $150 millon investment from Gates in 1997-1998- that it was no longer true that Microsoft had to lose for Apple to succeed....

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David Gelernter, Yale professor of computer science, says above all things Steve Job was designer-in-chief. At his Stanford commencement address in 2004, Jobs recounts his experience in a calligraphy course at Reed College as one of the singularly important experiences of his life, and something he carried over to the the revolution in portable devices- portable Macs, iPod, IPhone and iPad. The search for and building of elegant, easy to work, fun to use devices. Job was able to grasp the potential of such devices, says Gelertner, from his very first visit to the Xerox research labs in Palo Alto in 1979. In doing this he gives credit for long forgotten pioneers of the personal computer, who were just as important perhaps even more so, Douglas Engelbart and Alan Kay. At Xerox, Kay built on the earlier innovations of Engelbart. Engelbart was first to develop the mouse, onscreen window, and the concept of computers doing more than just computing, such as controlling machinery, doing everyday stuff, and doing things with pictures. Xerox's corporate executives failed to grasp the significance of the developments in their labs. Jobs grasped this rightaway and put all his efforts into developing the Apple Macintosh in 1984 incorporating these ideas. A decade later Gates copied the Mac's eay to use features and created economies of scale, creating the personal computer that we know today. The internet was a parallel development during that decade after the pioneering work of Tim Berners-Lee on the worldwide web. Jobs took the experience one step further and created new devices like the iPhone and the iPad that brought mobility, ease, and refinement to the internet experience....

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Jane Perlez of the NYT describes the efforts of China to draw the new South Korean president Moon Jae-in away from close defense ties with the U.S. Moon Jae-In won the South Korean election in 2017 and favors better relations with China and North Korea. China's goal is to reduce deployment of the Thaad missile defense system the U.S. has installed in South Korea, which is seen as reducing China's nuclear deterrance because the system also protects against missiles launched from China. Economic ties are also affected in the dispute as China has promoted a boycott of South Korean cars, televisions and other products, and fewer Chinese now visit South Korea. 

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Dow Chemical CEO, Anthony Liveris, is co-chair of the Advanced Manufacturing Partnership, an effort to bring together federal government, industry, universities and other groups to invest in new technologies that would generate good-quality jobs and increase U.S. competitiveness. He writes this letter in the Wall Street Journal to correct two misperceptions. The first, is that government has no significant role in nurturing an environment that is good for business and manufacturing industry. Because other countries, including China, are now operating like companies, it is important not to let the U.S. be in a disadvantageous position. Government has always been involved in its writing of tax and incentive policies, regulations, trade agreements, and creating a climate of certainty. The second, is that the loss of manufacturing capacity and job losses in the last 10 years are different from the job losses in the 1980's. These are not the low tech and less efficient manufacturing job losses of the 1980's, but job losses as a result of moving advanced manufacturing capacity and research and development centers to outside of the U.S. Of the 8 million jobs lost in the last recession, he says two million manufacturing jobs of higher pay and supporting employment in other sectors were lost. His point: its time to focus on expanding manufacturing in the U.S. because manufacturing is the sector with the highest multiplier effect on other sectors. Public-private partnerships are critical to this effort for increasing technology development and increasing investment. This view is supported by other experts....

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Inflation in China and rising wages are pushing up costs for American manufacturers. The pressure on China, most recently in Congress, is helping to push up the value of the yuan. This combined trend is making it attractive for some manufacturers to bring factories home to the U.S. A trend in the U.S. towards non-unionized labor and the new trend to a two-tier wage level- with lower wages for entry level workers- and the shedding of legacy health care costs, is creating a more cost competitive labor force in the U.S. This extends from older industries such as furniture and auto components to newer industries and technology. The new factories setup in the U.S. use technologies that require a smaller number of workers, in most cases less than half the number of workers that were employed earlier. This adds another element in cost efficiency, though it means fewer jobs are created with new plants.

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This New York Times editorial after the Senate passed a bill in October 2011 calling for action on the misaligned Chinese currency, points to ways a misaligned currrency is damaging for China. It cites the Peterson Institute for International Economics estimate that this is costing China $240 billion a year. This is a result of accumulating huge dollar reserves that have a declining value against the renminbi. Higher import prices lead to higher inflation. And low interest rates on savings, to the point that they are lower than the inflation rate, hurt the vast majority of Chinese and reduce domestic consumption. And perversely this leads to money pouring into speculative uses such as real estate, creating unsustainable bubbles in housing. The Times editorial says China is not generating jobs from this strategy, as the export strategy is relying on use of advanced technology in manufacturing and not creating many jobs. It cites a statistic showing employment has increased by only 1 percent a year from 2004 even with GDP growth above 10%. China is beginning to realize the cost of this strategy, and is planning a shift in its five year economic plan. But this rebalancing has many obstacles. The current system dominated by state run companies, banks, local and federal government, is biassed in favor of the old export led strategy, and experts are pessimistic about the possibilities for change. The Times suggests China may be falling back on the export led strategy as the global economy is slowing. The whole system would have to change after three decades of this kind of development, and would require new leadership and major changes....

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The lower oil prices in 2015 helps lower the current account deficit, which reached 7.9% in 2013, to 5% projected for 2015. Inflation is projected at 6.8%. GDP growth of 3.5% is expected for 2015. Turkey imports oil amounting to about 6% of GDP making for a large impact. Weakness is in the area of manufacturing, as Turkey's high tech exports are only 2% of manufactured exports, according to the Economist. About 1% of Turkish students have advanced computer skills. With problems in Brazil and Russia, money flowing into emerging markets is giving Turkey a second look after the emerging markets crisis in early 2014, when the lira slumped and interest rates had to be increased. The economy is recovering in 2015 from that situation. Two major beneficiaries of lower oil prices in emerging markets are India and Turkey in 2015, as both economies struggled with a large oil import bill.

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Researchers David Autor of the Massachusetts Institute of Technology, Gordon Hanson of the University of California, San Diego, and David Dorn of the Center for Monetary and Fiscal Studies in Madrid, in independent research, studied the impact of trade on 722 clusters of interrelated counties in the U.S. They focussed on the surge in Chinese imports and found a pattern. Counties with higher exposure to Chinese import growth showed higher unemployment and higher expenditures by the government for unemployment benefits, food stamps and disability benefits. Their calculations show the increased government payments amount to one to two thirds of the gains from trade with China. This does not include the losses suffered by people losing jobs who deplete savings as they look for new jobs. Hanson studied the effects of trade and Chinese imports in the 1990's and found the effects were relatively small. This time the effects are large and show counties that lacked local investments in industrial machinery and technologies in which China was still playing catchup such as Caterpillar in Peoria, Illinois, and Boeing in Everett, Washington, were most susceptible to higher jobless rates and in need of government support payments. Autor and Hanson found that from 2000-2007, communities in the 75th percentile- ones with greater exposure to Chinese import growth than 75% of all communities- saw a manufacturing jobless rate of about one-third more than communities in the 25th percentile. The government payments mean higher taxes or larger deficits are needed to support these communities, and long periods of unemployment reduce the incentive to work. Michael Spence, a Nobel prize winning economist from New York University, says the world has never seen such a rapid pace of growth as China experienced between 2000-2011, with rates approaching 12% in some years, making past experience and prevailing theories on trade an insufficient guide to what is happening....

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Foxconn announces salaries for workers would increase by 16-25% to about $400 a month before overtime. Foxconn plans to reduce overtime. Foxconn is a major supplier in China for Apple Computer.