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President Obama's proposal on Dec. 17, 2012, in the fiscal cliff negotiations sets the figure at which Bush era tax cuts are permandently extended at $400,000 instead of the $250,000 in earlier proposals. Speaker Boehner's Republican proposal was for a figure of $1 million. The $400,000 proposal would mean that the top tax bracket of 35% would increase to 39.6%. Currently the tax rate increases to 35% from 33% at the cutoff point of $388,500. The White House plan now cuts spending by $1.22 trillion over 10 years. $800 billion comes from cuts to programs, with half of these cuts in federal health care programs, $200 billion in programs like farm price supports, $100 billion in military spending, and $100 billion in other domestic programs over which Congress has control. The White House proposal also supports additional spending on infrastructure, extension of expiring unemployment benefits, protection of "vulnerable populations" such as the disabled and wounded veterans on Supplemental Social Security benefits in inflation calculations, and permanently stop expansion of the alternative minimum tax affecting the middle class. On business investment the president's proposal would make permanent the credit for corporate research and development....

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With the reduced demand for Fannie and Freddie mortgages with coupons under 5%, the Fed steps in and purchases $192 billion of 4% and 4.5% conforming mortgages on a gross basis by March 25, 2009. The move helps support falling house prices in the U.S. and reduces mortgage rates. It also helps banks improve profits. Estimates show the top 10 banks increased their holdings of securities issued by Fannie and Freddie and government agencies by $128.6 billion or 30% in 4th quarter 2008, which can be marked up in future quarters.

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Defense spending under the new Obama 2012-2013 budget for the fiscal year starting Oct. 1, 2012, is $525 billion, and an additional $88 billion for Afghanistan. This is $6 billon below the $531 billion budget for the 2011-2012 budget of $531 billion approved by Congress, $22 billion less than the Obama administration's proposed budget. An additional $115.1 billion was for Afghanistan. In a move to bring financial discipline to additional appropriations for foreign conflicts, the Obama administration is proposing in the 2012-2013 budget proposal a limit to "overseas contingency operations" appropriations. The total proposed is $450 billion for fiscal 2013 to 2021.

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A local government vehicle in China, Sixth Division of XPCC fails to make a bond payment in August 2018. This is the first such instance of failure to make a bond payment for a local government vehicle in 2018. Economists estimate China's total debt at 242% of GDP in 2017, and government efforts to tighten liquidity and reduce support for overextended local government investment vehicles.

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It may come as a shock to the Egyptian people and freedom loving Arabs and Americans everywhere that Secretary of State Hillary Clinton called the Mubarak government "stable" and "responding to the legitmate interests of the Egyptian people," on Tuesday January 25, 2011. Vice President Biden said on Jan 27, in a night interview on PBS, that he would not call Mubarak a dictator and did not think he should step down. This Washinton Post editorial is strongly critical of the Obama administration for its statements implying that the 30 year Mubarak regime would continue. It says Mr Obama spoke with Mubarak on Friday night and after speaking to Mubarak stated that he would continue working with Mubarak, and not once mentioning elections. The Washington Post says it is dangerous to assume that the energized and enraged people of Egypt protesting on the streets of Cairo and other cities will back down and carry a dialogue with a regime that has repressed every form of assembly and free expression for three decades. It supports the moderate and democratic platform of leaders of the protests and of Mr El-Baradei. This includes lifting of a hated emergency law that bans peaceful assembly, the right to freely organize political parties, and allowing free democratic elections. The Post calls on the Obama administration to prepare for the peaceful implementation of the opposition platform, and telling the Egyptian army without qualification, that violent repression would rupture the rellationship with the United States....

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The cost to France of Greece's exit from the euro would be 66 billion euros, and for Germany 90 billion euros, according to the director of research at the IESEG School of Management in Lille, France. Greece would pay back some of its debt with the devalued currency, so the actual cost might be lower. This is closer to the estimate of 50 billion euros for France by the departing French finance minister, and the estimate of 125 billion euros for Germany by a German bank. IIF estimates are much higher but the IIF and Mr. Dallara will find the bonds issued by Greece under the restructuring of little value in the event of exit from the euro, which is why it would not favor an exit and present it in a different light.

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Efforts by management at Goldman Sachs to correct errors from the period before 2009 and improve its business practices and image.

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Chadwick Matlin's review of NYT's Ross Sorkin's book "Too Big To Fail," tells the story of Fuld's cockiness, overconfidence, whats the right word? He got into a fight with his ROTC officer as a student writes Sorkin in his new book. And there he is turning down offers from a Korean bank, Barclays and Bank of America - making the wrong decision each time- because he did not recognize the danger Lehman was in and had an inflated view of Lehman, helped by staffers. Perhaps says Matlin, encouraged by the people that he surrounded himself with. A anecdote in the book is cited that shows Fuld in New Delhi asking Treasury Secretary Paulson if he could get clearance from Russia for his flight to cut 5 hours of flying time, and Paulson telling him he couldn't get that for himself.

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Feldstein emphasizes the need to help homeowners with a plan he suggested back in June.. And suggests spending by the government to build infrastructure, other spending initiatives to stimulate demand, and rebuilding military capacity. Spending he suggests should be large enough to make an impact, as the loss of household wealth from falling home and stock prices could result in a loss in aggregate spending of $300 billion or more. He points to the need for urgent action.

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Van Dam says its not that great being a worker in the U.S. because it is hard for the unemployed resulting from competing with workers in other countries with lower wages, and for those who are unemployed harder because worker collective bargaining is weakened over 3 decades. He cites a 296 page OECD report showing very little government support for unemployed and at risk American workers. It says this has contributed to higher income inequality and larger share of lower income people than almost any other advanced a nation. Only Spain and Greece are shown as having more households earning less than half the median income- showing large numbers of people are poor or close to being poor. In the U.S. an average of 1 in 5 lose their jobs each year, and 23% of workers 15 to 64 are in their job less than a year in 2016. The job churn hurts workers because of firing and layoffs being frequent, more than is healthy for a economy. The U.S. and Mexico are the only two countries not requiring advance notice before firings. And fewer than half of workers find a job within a year in the U.S. Two in three families with a displaced worker fall in poverty for some time. Unemployed workers with typically 26 weeks support get less support than any other country in the study. Only 12% of workers in U.S. are covered by collective bargaining. ...

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Angela Merkel's call to the Greek president calling for a referendum vote on Greece's wishes to remain in the eurozone. This is denounced by Syriza and the centre left parties. Merkel denies she made the call, but Greece's president says the call was made.

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The story of Brazil's sugarcane plantation industry, and also of its ethanol producing region. A detailed account of the people who own these plantations and why they are reluctant to sell. The difficulties of getting into the sugarcane planation industry in brazil with its small owners and fragmented nature, and use of labor that violates Brazilian laws and international standards. These sgar cane plantations are located next to the mills because of the available infrastructure, and family owned sometimes handed down for generations, even hundreds of years, as Brazil was once a portuguese colony and a location for the slave trade which provided labor to the plantations. Note that most of the plantations use poorly paid labor and most of the work is done by hand, with the owners living in large ranchlike fazendas. Its probably another world for international investors not used to such a landscape. There are labor and environmental liabilities in owning some of these mills. Then most of these mills do not keep reliable accounting books and have tax and debt issues which cannot be easily resolved in Brazil's slow legal system. There are about 210 companies running 368 sugar and ethanol mills. The five largest companies generate only 17% os sales gives some idea of the fragmentation in the industry. There is also the perception that if large foreign companies like the ADM, Australia's CSR, Germany's Sudzucker AG, or even India's Bajaj Hindusthan, or others gain control over Brazil's ethanol industry Brazil's sugar producing regions would benefit less than if they get loans from large Brazilian or international banks and consolidate and modernize themselves, leading to political pressures in this direction. One such example is given here, one valuable sugar mill Vale de Rosario has been pursued by Bunge with an offer of $640 million for outright ownership, but Vale de rosario's board rejected the offer. Cargill looked at the possiblilty of owning 30% but was also turned away. Attempts at consolidation by Cosan, Brazil's largest sugar manufacturer, which made agreements with relatives owning 50.2 % of the shares in the company which has about a 100 relative clan with shares in the company over generations, also failed. The Biagi and Franco families which run the company made use of a defense under the cooperative's bylaws which allows the smallest shareholder to have 30 days to equal any takeover offer. The Biagis offered their own Santa Elisa mill to secure a $675 million credit line from Brazil's largest private bank Bradesco which was then used to buy out relatives who wanted the money. Now the Vale de Rosario and Santa Elisa mills have merged and are looking for international financing for the new company Santelisa Vale, which becomes the second largest after Cosan. Goldman Sachs plans to invest 200 million in Santelisa Vale.What this shows is the extraordinary lengths these family owned mills would go to to preserve their independent ways of operating and hand over to the next generation. Another difficulty is that industry experts are hard to recruit from these family owned companies as they have spent alifetime working there and remain loyal. With allthese obstacles the logic that the foreign companies can use Brazil to supply the world with ethanol from sugarcane does not take hold. Some of the attraction of sugarcane is that it contributes less to global warming than corn as a source for ethanol because sugarcane absorbs some of the CO2 when it is replanted. With a 51 cent per gallon tax credit subsidy on USA corn based ethanol and a 50 cent tariff on Brazilian ethanol imported into the USA, corn based ethanol can sustain in the US especially with the current high price of gasoline. Brazillian ethanol is more efficient to make from sugarcane and can be made to compete with gasoline even if gasoline prices drop. Instead there may be more years of unstable supply of ethanol from Brazil ahead which is what the Japanese in their negotiations for a supply of ethanol from Brazil have discovered since seeking such an agreeement since 2001. In the 1980's Brazilian sugar producers chasing high sugar prices lowered production of ethanol and left drivers without ethanol at the pumps. One company that is looking at another solution is Brenco, Brazilian Renewable Energy Company, a startup company backed by Ron Burkle and Vinod Khosla. It plans to put up its own green field sugar cane fields away from Sao Paulo state where the Brazilian sugar cane industry is presently concentrated. But this will take six year before the fields are ready for ethanol production. Henri Reichstul, a former head of Petroleo brasileiro, Brazil's national oil company, now leads Brenco. ...

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Yannis Stournaras, economcs professor at the University of Athens becomes the finance minister in the new administration of prime minister Antonis Samaras. He holds a doctorate from Oxford University in economic theory and policy, lectured at St. Catherine's College, Oxford and at the Oxford Institute for Energy Studies. He was special advisor on monetary policy to the finance minstry and Greece's central bank. His public official positions include vice chairman of the Greek natural gas company and board member of the public debt management agency. He is well qualified to lead the effort for Greece to remain in the European Union with modified terms that extend the achievement of deficit targets by 2 years to 2016, and offer tax cuts and other growth oriented measures to get the Greek economy back on the path to recovery and growth after 4 years of declining GDP. He also brings a sense of committment to the EU, because he was chief economic advisor to Greece's Finance Ministry in 1994-2000 and took part in the negotiations that led to Greece's joining the eurozone in 2001. His strong views about changes needed to Greece's overregulated economy which favors special interests also coincide with the moves for labor and other reforms taken by the Monti and Rajoy governments in Italy and Spain. ...

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So far the Italian government has already recovered $15 billion for 2011 in its fight against tax evasion. The fight includes an advertising campaign depicting tax evasion as anti-social activity and vigorous enforcement by tax officials and the financial police. Italy has already banned cash transactions to reduce possibilities for evading taxes. This problem is severe in Italy because the underground economy is about 17.5% of GDP. An estimated $150 billion is lost to the Italian treasury from tax evasion. As a result Italy has a chronic budget deficit problem and is not able to make necessary investments in improving competitiveness to keep up with other countries. This may be one of the lasting achievements of the new administration of Mario Monti, along with its efforts to change the way the public thinks about other issues including labor laws that place large burdens on small companies in hiring practices. Italians sense the need to change the way they think about taxes because this is one way to reduce the burden of austerity measures- higher tax revenues could enable lowering taxes. It would also enable investing in improving competitiveness that would the economy grow and provide the jobs to reduce the high unemployment rate among young workers. One of the lasting positive aspects of the eurozone crisis is the change in the way the people and society think about many issues....