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NYT exhortation for Congress to resist the lobbying pressures of the banks to weaken regulation for a Consumer Protection Agency and derivatives trading on exchanges. The first by amending legislation for a Consumer Protection Agency so that no states can pass tougher consumer protection laws, something that prevented states from protecting consumers from abuses in the mortgage business. The second to propose legislation for derivatives trading that allows corporations and hedge funds to trade derivatives privately. NYT editorial says Congress should require all derivatives dealers and users -banks, hedge funds and corporations- conduct their trades on exchanges where they are reglulations and public scrutiny. NYT responds to the banks and corporations that say this would raise their transaction costs to hedge any given risk, by saying that this is debatable. Greater transparency should reduce costs but even if there were some higher costs it would be outweighed by the larger benefits to the banks themselves and the country through the lower systemwide risks. ...

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Where do you place a winner of the Democratic primary in Maine, Graham Plattner, an oyster farmer who dropped out of college at George Washington University, served briefly in the Middle East wars of Bush and Obama, and had PTSD. Is he working class, middle working class or is he from a downwardly mobile professional class considering he has parents who are well educated and father a prominent lawyer in Maine? Plattner easily defeated a 3 term governor of Maine with his average working class demeanor and language. He is for universal health care, (Medicare for All) universal child care, affordable housing, affordable college. Politics in the US has been moving away from the simple divisions before 1950 created by the Industrial Revolution- the workers in factories and the owners of capital allied with the professional middle class. The few owners of capital mostly college educated allied with people from the non college educated workers in factories who are conservative in their values and beliefs and on the other side the college educated professional middle class now downwardly mobile because of the many recessions and high unemployment from frequent financial crises, with college costing $80,000 a year putting them in deep debt. There is today in the WSJ a story of a professional worker who at $194,000 a year salary is not able to payoff $15000 debt which owners of capital have set at 26% interest and is in downward spiral. Some of this comes from large college and other debt. There is says WSJ Analysis $1.25 trillion in credit card debt alone with highest delinquency rates in decades in 2026. Cost of living has only made things worse and some of this happened as Biden poured money into the economy to help people hurt by the pandemic, yet with some short run consequences with demand strong businesses including hotels, restaurants and grocery stores, auto dealers, jacking up their prices by over 20% in 1 year and Biden failing to respond, getting overwhelmed by open borders migrants under Mayorkas and Harris (also hit by a sudden Venezuelan migrant influx). This is the America one has today- a confusing mix. This in reality means Democrats may take issue with Democrats, Republicans take issue with Republicans, and Democrats join with Republicans on issue by issue basis. It might actually be rational than irrational. On cultural issues if the country has gone over its head and moved too fast on some issues that are not for the general public good, people of different backgrounds can come together to get the best path. On economic issues things are never so straightforward, there are unpredictable consequences and the rules of economics are really not so straightforward either.  Providing relief can mean the government shouldering the burden as during the pandemic which it should, yet with caution as businesses can use the excess demand to raise prices and one is back to square one with everybody worse off as happened with Biden. Migrant flows and fears of insecurity in public spaces can lead to a severe public "discomfort that can waylay the best intentions of a Harris or Biden, leading to public "backlash." In fact the title of a recent book is "Whiplash." Current books include Floridan Marco Rubio's "Decade's of Decadence- How our Spoiled Elites Blew America's Inheritance of Liberty, Security and Prosperity." Rubio means it. Its authentic because as Rubio says repeatedly, his parents could make a living in the 1960's working in a factory with decent wages, low cost of living and low cost of college, the arithmetic between salaries and what you needed for decent home in suburbs and sending children to good public schools, then to college, all adding up. The result is that Rubio could go to college and serve in the Florida legislature. Rubio says in 2026, after the elites under Bush and Obama and faulty economic theory shipped all of our factories to China, that the story of his parents and his education would simply be impossible. This is what he told people in India on his first visit last week. His parents were Cuban immigrants, yet he identifies with Spain and with western civilization, a devout Roman Catholic. Rubio is a Republican, and is in large contrast with Alejandro Mayorkas, also from Cuba, and Biden's Head of Homeland Security. This is the mix of people and representatives in Congress,  business people, small business owners, professionals, that we have today in 2026 in the US. Plattner and Rubio, one a Democrat and one a Republican- both have something in common. Plattner also has general disdain for "the corporate interests, the billionaires, the Washington DC elites, and the establishment politicians."  The winds are blowing in the direction of getting things right- remembering that Eisenhower continued the work of the Kennedy and LBJ administrations (Eisenhower built the Interstate Highway System for instance, and LBJ gave America Social Security and Medicare). Before that Franklin Roosevelt a Democrat built on the work of his uncle Republican Theodore Roosevelt (TR gave America the idea of good governance and built the US Navy, FDR fought the Depression and stabilized a faltering economy after mistakes made by Republican Herbert Hoover could have happened even if Hoover was a Democrat. FDR was himself from a wealthy New York family and when he first met fellow New Yorker Frances Perkins before his struggle with polio, a haughty New York gentleman. That was before Frances Perkins as FDR's Labor Secretary joined forces with Roosevelt to give New York a modernized administration governance structure by 1940 that was applied to all 51 states after 1950. It allied labor with capital with fairness for all, and was the first such modern structure of this size the world had ever seen, which was the fundamental strength of the United States of America. It was imitated in Asia, first in the Shanghai region then China, and first in the Ahmedabad region and now India. The US is faced with the challenge of recreating and rebuilding this today, as first China, then India remind America of its roots which they have followed in their own style and culture.  First good governance, then good institutional structures, alligning labor and capital with fairness for all, strong affordable + accessible educational and healthcare systems, and investments of capital and labor for infrastructure + industrial development. ...

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Seen as a rural urban divide, less educated and well educated and tech workers the situation in France looks similar to that in the US in the elections of 2016 and 2020. With business in the US and European Union shifting manufacturing to China and the governments neglecting rural areas, decline in standard of living for people on pensions that have not kept up with the cost of living, the situation in France as in the US is decades in the making. Bernie Sanders and Melenchon were appealing in different ways to younger people yearning for change and a system that would correct these changes.   Melenchon coming this close to less than one percentage point of Le Pen in the first round of French elections shows that a straight Macron Le Pen version of what has happened is an oversimplification, just as seeing the changes in America under president Biden vs Trump would be a simplification, as voters for Sanders who voted for Biden are changing the Biden agenda and setting America on a new path. A path to reshoring jobs that were sent to China, rebuilding American manufacturing, increasing workers wages and restoring workers leverage for higher wages, investing $2 trillion in child care, housing, supporting worker incomes and families, supporting older Americans on pensions. In the same way beneath the idea that nothing has happened after the yellow vest protests for cost of living, that has not only not gone away- but increased in the concern for cost of living in this election with the surging inflation - new developments are happening.  Even as Germany under Merkel appeared not be changing in 2020- 1 year after Merkel the situation will have changed completely to address social concerns that were ignored earlier and to invest in infrastructure in a big way. Behind this is a fundamental change that is taking place. Facing a challenge from totalitarian states the fabric of society in the free world, the US, Germany, France, other EU states, India, and nations in the free world will have to respond with changes that restore the fabric of society to what it was before this kind of fracturing, bringing all parts of society together to bring all the energies in place for rebuilding, investing in infrastructure, restoring local manufacturing and renewal. It requires a unified effort to be put in place to respond in the right way.     ...

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The Russian economy had GDP decline of 2% and was relatively not affected by the shutoff of imports of oil and gas from Europe in 2022. Gas exports to Europe began declining in the summer. The EU ban on seaborne oil from Russia and price cap went into effect in December 2022. Russia made a huge stimulus of 4% of GDP in 2022. The result is that only now in 2023 is the full impact being felt on the Russian economy.  WSJ reports that in January and February Russian exports of oil and gas revenue which makeup half of the budget fell by 46% year over year, while state spending jumped 50%. Analysts estimate that it would take a price of $100 for Russia to balance its books. Yet the Group of Seven price cap on Russian oil has brought it down to $50- the price the Ministry of Finance says Urals crude sold in February. This is a deep discount to the $80 price of Brent Crude, the US benchmark.  A bigger problem is the downward trajectory the Russian economy faces in future years. Worker shortages are severe for industry and a shift to wartime production does not add to productivity or productive capacity. The cut off from access to western technology and western financial markets will have a severe impact in the productive capacity for the economy, for oil and industrial production in the years to 2030. Russia needed to protect against the gradual shift away from fossil fuels to fight climate change by shifting the economy in a new direction using its access to western technologies not just China's technologies. Instead it now finds itself in a period of 1 year in 2022 when oil revenues surged with prices jumping from the war, and then a steady slump in all the inputs of development- supply of labor, capital and technology declining rapidly after 2023 as the costs of the Ukraine invasion are absorbed into the economy. As this report points out it is the social contract that similar to China's social contract of growth and improvement in standards of living that led to people having a large measure of confidence in the government. It was not fully grasped but it was the access to American and European Union plus Japanese technology, manufacturing, capital and markets that made this possible. With this absent the situation changes to put Russia, and China to a lesser extent as long as it trades with the west, on a different trajectory.  ...

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Lessons can be learned about careful reopening in fighting the coronavirus from other countries. Here the Netherlands experienced a rise of cases by 500% within two weeks of reopening after some poor decisions. The Mark Rutte government decided to open all bars and nightclubs resulting in a twelve fold surge in these locations in one week. Most of the new coronavirus cases were in people 18-29. Data from Dutch public health institute shows 4 out of 10 new cases linked to bars and nightclubs with 262% surge in cases for young people 18-24 years. This goes to show that with the vaccination drive what we see is the cases shifting to younger people, the unvaccinated, and to activities like nightlife. People going to work, or doing hybrid remote work with trips to the office, workers in factories, people doing essential shopping, are not causing the rise in cases. Much can be learned from these examples in working out reopening that does not lead to new crises with surging cases in new waves of coronavirus. Earlier in 2020 summer tourists who ignored mask and social distancing restrictions in Croatia brought on a post summer coronavirus wave to Germany and Austria. This time Greece and Portugal are introducing restrictions. Greece plans to make vaccine health pass required effective July 21 to go into restaurants. Another lesson from Netherlands this week is that a 20,000 person music event of 2 days in Utrecht where QR codes were required showing vaccination or PCR tests failed. About 1000 cases were attributed to the Utrecht event alone. Reasons given are that people faked the QR codes, or that the covid testing system produced too many false results as much as 20%. The same QR code system was followed at nightclubs resulting in big problems. One can never be sure that things work as expected and the risks are great as this adds up. Even vaccines offer limited protection and only if fully vaccinated depending on the type of vaccine. One dose of the vaccine is simply inadequate, and obesity, other morbidities can lead to problems. Withdrawing the mandatory use of face masks in most situations is also a risky decision of the Dutch government. Face masks offer the added protection at a time of variants that spread quckly, and when large parts of the population have only one dose of the vaccine, some elderly are still not vaccinated, and young people have not been vaccinated in large numbers. ...

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Oil traders are pricing in much higher oil prices- with $150 not being inconceivable- because of Mideast unrest. They see this unrest playing out over a long period of time, and do not see this changing even if the Libyan situation returns to normal tomorrow. Saudi Arabia will need to price oil at $85-90 a barrel just to meet the economic demands for a growing population, says Rachel Ziemba, analyst at Roubini Global Economics. Saudi King Abdullah recently promised $150 billion in new housing, higher wages and other benefits to prevent protests. The fiscal pressures are growing in these countries. A $15-$20 premium for unrest is assigned by Paramount Options, a trader at the New York Mercantile Exchange.

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Germany's chancellor Merkel sees Britain as necessary for Europe and the European spirit. This even though she has differences with British prime minister Cameron on how to elect the new president of the EU following EU parliamentary elections in May 2014. She told the German parliament in June 2014- "Britain is really no cozy partner. Yet Germany and Britain share values and interests. I consider it grossly negligent, in fact unacceptable, how easily some people say that it is really all the same whether Britain goes along or not, or more: whether Britain remains a member of the European Union or not."

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Looking around Havana U.S. president Obama finds a country stuck in the 1950's. His observation: "You drive around Havana and you say, 'This economy is not working' ...It looks like it did in the 1950's." Obama's view on relations with Cuba was that things have changed, with younger Cubans especially looking to integrate with the world economy for a better life. This is the same in Venezuela, in Argentina. His view: "I know the history, but I refuse to be trapped by it."

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An argument for more troops, as Max Boot of the Council of Foreign Relations vists Afghanistan at the request of General Petraeus. This is a local account, what is the larger picture. And can the problems of a failed Afghan government and the way American boots are seen as foreign occupiers be wished away? See the link to Kristof who says even the Punjabis in the Pakistan army are not welcomed in Pashtun land on both sides of the border, and there are 40 million Pashtuns.

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This report in the NYT shows that some of the people who identified themselves as Republican in 2016 may not do so in 2017, as the Trump administration makes policy moves that are unpopular with sections of society that were earlier open to his new ideas. Gallup supports studies at Emory University showing a 4% shift, a 4% decline in identification with the GOP Republican label. After a eight years under a Democratic administration some fatigue set in and this was reflected in the election. Now that Republicans are in power in states and the federal level, they face a critical public spotlight on how their actions match the interests of their constituents. A similar process was seen in Britain, after the seeming support for Brexit in 2016. By 2017 some of that support shifted and some new energy on the side of Labor among young people made a difference in the last election with losses for the ruling Conservatives who supported Brexit. Normally this process takes time. Yet this time because ideas such as Brexit or withdrawal from the Paris climate change agreement, or the investigation into Russia and the U.S. election, are so drastic in their impact that the pendulum seems to correct itself by swinging to the middle. ...

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Economist Wu Jinglian, was adviser to Chinese leaders Deng Xiaoping, and Jiang Zemin. He sees risks ahead for China in the crony capitalism that has developed there. Business tycoons and corrupt officials he believes have hijacked CHina's economy and manipulated it for their own ends, which he calls crony capitalism. Its asystem in which the bureaucrats and their allies benefit from bribes and payoffs, and by steering business to their allies in industry. With increasing corruption as theses bureaucrats want to get richer Wu is not optimistic about the future. He sees three dangers, awidening income gap, inefficient monopolies, and crony capitalism. WHile there is corruption and amarket economy in India, the big difference is the free press and strong media in India which keeps corruption out in the open whereas in China there is more scope for this and crony capitalism because of the tight control on the media. Younger economists like the head of its soverieign wealth fund and its central bank have been influenced by Wu....

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As the US asserts the Monroe Doctrine we show here what TR (Teddy Roosevelt) said about the spirit of the Monroe Doctrine in his Annual Messageto Congress in 1904- for the good of the American continent following the principles of good government the US had learned from Britain in the centuries before 1700. "A great free people owes it to itself and to all mankind not to sink into helplessness before the powers of evil." "It is not true that the United States feels any land hunger or entertains any projects as regards the other nations of the Western Hemisphere save such as are for their welfare. All that this country desires is to see the neighboring countries stable, orderly, and prosperous. Any country whose people conduct themselves well can count upon our hearty friendship. If a nation shows that it knows how to act with reasonable efficiency and decency in social and political matters, if it keeps order and pays its obligations, it need fear no interference from the United States. Chronic wrongdoing, or an impotence which results in a general loosening of the ties of civilized society, may in America, as elsewhere, ultimately require intervention by some civilized nation, and in the Western Hemisphere the adherence of the United States to the Monroe Doctrine may force the United States, however reluctantly, in flagrant cases of such wrongdoing or impotence, to the exercise of an international police power." ...

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Christina Romer, former chairwoman of Obama's Council of Economic Advisors, puts forward a strategy to get deficit reduction and avoid the "fiscal cliff" of automatic cuts based on the Simpson-Bowles commission recommendations to reduce tax expenditures, deductions and loopholes. She says let Republicans in Congress determine where spending on infrastructure improvements should go as the needs are so diverse and widespread and this will get constructive input to improve the focus on vital areas. Earlier efforts on road building for stimuls spending were criticized for generating temporary work but not creating long term benefits and synergies.

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Japan's Sanseito anti-immigration party gets 7 seats, enough to deprive the ruling LDP-Komeito alliance of its parliamentary majority. Prime Minister Ishida of the LDP party may not last more than a few months. The LDP seems to have lost its way like the Democrats in the US. A recent article in NYT says LDP wanted to bring in 60 million tourists to Japan each year to boost the economy. Yet Japanese people in cities have a hard time handling 40 million tourists in 2024, with reports of disturbance of the once quiet life in city neigborhoods and failure to adopt the culture and language of Japan. Reports of migrant/tourist or immigrant crime get much press coverage. Japan has 124 million people and birthrate of 1.26 below the birthrate of 2.1 needed to stabilize population. Business asks for new immigrants to fill unfilled positions. The public has different ideas and the migration is causing disturbance in traditional way of life in Japan. Similar to what is seen in the US and Germany in more striking ways. The nationalist parties including Sanseito say even if the population falls to 100 million this is more than the population of 90 million in Germany, and is enough to sustain its economy. Use of robotics and AI is not talked about as much but offers Japan, US and Germany, a way to make up for the loss of foreign labor. In essence both American, British, Spanish, German, French, Italian, Austrian, Dutch, Danish and Japanese society share a yearning for traditional ways of life that are being ruffled and disturbed by the migration, immigration, or over tourism affecting their countries. Politicians need to pay attention to people affected and not live isolated in their own neighborhoods from the people in other less sheltered communities and neighborhoods across their countries. ...

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Krugman points out that some depreciation in the value of the dollar is welcome because it would make US exports more competitive and reduce our trade deficit. He says China's policy of keeping the yuan pegged to the dollar actually devalues the Chinese currency and makes it possible for China to siphon off growth from other countries. So what should America do. By putting pressure on China to revalue the yuan upward would America be risking China responding by selling some f its $2.1 trillion in dollar assets. This would not be such abad thing if the Chinese sold some of their dollar assets says Krugman, as lowering the value of the dollar at this time is not such abad thing. Malpass and Alan Meltzer of Carnegie Mellon, point out the importance of maintaining the value of the dollar in a separate piece. There the idea is not to have sharp fall in the value of the dollar that could economic disruption because of loss of confidence in the currency as opposed to a gradual decline.

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Peers says the Motorola Mobility acquisition raises doubts about the Google advertising focussed strategy. One option for Google, which lacks manufacturing experience, is to keep the patents and sell off the manufacturing business at an early date. The smartphone business is a low margin business and Motorola is not making money. Apple is an exception because it occupies a special niche in the business that helps it sustain higher margins. At this time there is considerable doubt on what Google's strategy will be.

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Buffett's view that higher capital gains taxes will not result in less business investment. He favors a $500,000 figure instead of the $250,000 proposed by president Obama for Bush tax cuts for incomes below that level.

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Boeing's improvements in quality and production processes for the Dreamliner, as the first Dreamliner which will not need major additional work before delivery comes off the production line. Costs of production have reached the point to where Boeing is losing $100 million on each plane sold. Ony 300 small assembly tasks remained, closer to the 200 that is the company's goal, and improvement over the 6000 additional small assembly tasks remaining in the early versions. The Everett, Washington plant now can make a 787 Dreamliner plane every 6-7 days. It costs Boeing $242 million to make each plane, and it sells them for $113 million according to UBS analysts. Boeing will have invested about $20 billion in the Dreamliner by 2014, when analysts say it should turn a profit.

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The Environmental Protection Agency moved to assume authority over 14,000 coal burning plants, refineries and industrial complexes that emit more than 25,000 tons ( or emissions from burning 131 railcars) of of greenhouse gas emisssions, and are the source of 70% of the U.S.'s greenhouse gas emissions. The bill exempts the smaller facilities, "every cow and Dunkin Donuts," as Lisa Jackson EPA administrator put it. It exempts millions of other sources like bakeries, dry cleaners and hospitals, and focusses on the 400 largest facilities that do most of the environmental damage. These facilities will be required to obtain construction permits and prove that the best available technology has been applied. Lisa Jackson said we are not going to go ahead with business as usual, and it will give President Obama something to show at the Copenhagen talks. Senators Kerry and Boxer are introducing legislation that will be fought by the power plants, and this move by the EPA will be challenged by the power companies....

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WHy did NHS Test and Trace fail to contact no more than 50% of the persons who tested positive. Why was it not able to followup with the people who needed to be visited in their homes to ensure isolation. Why was NHS associated in the name when the NHS had not been consulted and involved in the design of this service. In fact it ignored lessons from Germany where the contact tracing was entirely from local, started very quickly with the key being local or state employees who were diverted to this task and were skilled and motivated to do it. Why was this critical task simply handed out to outsource it to private companies.  Germany's example was there very early in March-April and it was working. Why reinvent the wheel. Setup quickly and entirely local it required only a desk, a desktop PC, and a national database to which PC was connected, the skilled caller being the key to getting people to talk to and cooperate. About 80% of those testing positive needed to be contacted. NHS Test and Trace was reaching about 50% and many that needed to be visited at home could not be followed up quickly. The shift is only now being made to go local. It worked in Leicester and other places but the learning came the hard way, as with many things during this pandemic. ...

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Fox News and WSJ are taking differing positions on Epstein case with Fox News ignoring it and the WSJ carrying the story. Murdoch and DJT have a complicated relationship in July 2025 following the $10 billion DJT lawsuit against Murdoch filed in late July after a story in the WSJ. WSJ parent company Dow Jones says it stands by the story and will defend the accuracy of its reporting. Both the DJT Republicans and the Fox News network appeal to conservative viewers of television, and people in business. WSJ has carried stories questioning the tariff policies of the president, and is critical. It is also not fully supportive of policies to handle migrants. Fox News another Murdoch news outlet is through programs like "Hannity" supporting the president and DJT supports it. This creates a dichotomy in the support when DJT and Republicans are putting forward an agenda that is moving fast on the economy, migration, crime, and world trade requiring support to keep the conservative groups together in the US. This is not a situation encountered before as the nation is moving to a crossroads in which direction it should take. And this does not even take up the issues of climate protection which will come up, and of pharmaceutical companies overcharging Americans for healthcare, other battles that will take place.   ...

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Is this a sign of things to come, after all the Japanese economy has seen sagging consumption for years with a two tier economy with full time workers and parttime workers with no benefits. The parttime labor force increased from 4.13 to 4.79 million according to the Labor Department and its the highest since 1993. Now people are doing this not by choice but for economic reasons. And employers like Kroger are doing this so that they can hire more parttimers with no benefits and pay benefits to fewer employees. There are also computerized scheduling systems for parttimers that are becoming popular with retail stores that use a lot of partimers.

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The EU negotiator Mr. Barnier makes a concession on the Irish backstop which was already previously rejected by prime minister May. May says Mr. Corbyn of the Labour Party, that he was not really interested in finding a solution, and has given only one hour for talks in five weeks. The Irish prime minister Varadkar says May has not offered any solutions for Brexit. May says she will give parliament the chance to vote  for an extension of the March 29 date under Article 50 or decide if it wants a no-deal Brexit.

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“The industry operated in a certain manner in the first half of the decade that is not an appropriate path for the second half of the decade,” says Microsoft President and Vice Chair Brad Smith. Microsoft will now act as aresponsible company and pay higher electricity prices, replenish water supplies, and pay more for land so that electricity prices are not pushed up by AI data centers and passd on to consumers. This draws praise from DJT as the US faces an affordability crisis and AI is suspected to increase the cost borne by consumers of electricity. 

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The question remains why the defamation law has remained a part of the Indian Constitutional law and the Indian  Supreme Court has upheld it. Under Britain there must be the sense that this would have put the unified subcontinental government at risk. Under India post independence this could be seen as an effort to keep the unified country India that emerged from the British Indian rule together as one nation. It may not be individual to individual defamation that underlies the spirit of this law. Its spirit may lie in keeping together as one nation a country with many languages and people after centuries of foreign rule by not letting the spirit that keeps it together be undermined in any way or form. Gandhi and the independence movement before Gandhi created the spirit for a new nation from many peoples and languages, this has now taken the form of timely delivery of the services and infrastructure that these peoples are entitled without any dilution of any sort, after all the hard work, sacrifices and aspirational effort of an earlier generation of leaders. ...