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Prime minister Monti of Italy played a key role in getting Germany to accept short term measures for the eurozone crisis. This includes having the European Financial Stability Facility, the eurozone's bailout fund, buying govenment bonds of Spain and Italy directly in private markets to reduce the unsustainably high yields on these bonds. The plans proposed by the EU include setting up a European banking regulator.

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The Merkel government's effort to convince a skeptical German public about the need to aid Spain's banks. This includes a video on YouTube. The German parliament will vote shortly on the loans to Spain's savings banks.

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Ada Colau and her fight to introduce fair practices for mortgages and change Spain's mortgage banking laws. Her organization is PAH- Platform for People Affected by Mortgages. The need for consumer protection in Spain's mortgage laws.

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The German and French positions on solutions to the eurozone debt crisis are in conflict. As a result the negotiations between France's Sarkozy and Germany's Merkel are deadlocked. The basic differences revolve around three basic issues. Germany wants to see a lasting solution in which Greece debt is restructured so that banks and other creditors that loaned money to Greece voluntarily take losses so that Greece's debt can be reduced to a sustainable level of no more than 50% of what it is now. France, the ECB and the French banks do not want to restructure Greek debt in this manner beyond the 21% reduction in value of debt under the July 2011 agreement. The voluntary reduction in Greek debt by the banks would prevent a default by Greece and unsettling of the financial markets. France fears market contagion from the restructuring of Greece debt that would place pressure on French banks as the value of the Greek, Spanish and Italian sovereign debt French banks hold declines in value. That would require a major recapitalization of French banks and additional cuts to the French budget. Additional twists to the negotiations are that Sarkozy is unpopular in France with elections six months away. For this reason Sarkozy would prefer to recapitalize after 9 months. A way to get around the need for more deficit cutting (austerity measures) in France, is for the European Financial Stability Fund to be able to borrow money from the European Central bank. The ECB can print euros in that situation. Germany's chancellor Merkel has to consider German public opinion and experts from the German central bank, who are adamantly against using the ECB to print money and Germany committing itself to bankrolling most of the effort. Germany wants France to use its own money to recapitalize French banks, with Germany only responsible for recapitalizing its banks. Merkel told her parliamentary caucus in Berlin that "the path is closed for using the European Central Bank to ease liquidity problems." Because of Germany's insistence on financial soundness for any solution, France being in the more difficult financial position and Sarkozy facing elections willing to come up with a short term fix, and the unwillingness of French and German banks to take the losses necessary for a lasting solution, the Germans see a real solution taking a long time. ...

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With the U.S. Federal Reserve pulling back from its monetary easing policy and the ECB holding steady with a low interest rate policy, bond investors are finding attractive buys for government bonds of Italy and Spain. 10 year government bonds of Italy yielded 4.2%, and Spain's government bonds yielded 4.3% on Aug. 22, 2013. By comparison German government bonds yielded 1.88%, narrowing the gap between the bonds of southern European countries and German bonds as the eurozone economies recover in 2013-2014.

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The incoming executive director of the European Banking Authority, Adam Farkas, voices concerns about the stress tests of European banks in 2010, and would like to use more rigorous criteria for 2011 stress tests. "I would personally opt for a stricter approach," he said in testimony at the European parliament in Brussels.The stress tests for 2011 are already being watered down by the EBA in response to pressure from governments. The stress tests use macroeconomic criteria for growth and unemployment that are benign. And tests are not taking into account a scenario in which European sovereign bond holdings of European banks decline in value due to defaults in some countries. The result is likely to be a loss of credibility in the stress tests. Under worst case scenarios for Greece, and some other countries, their economies would do better in 2011 than in 2010, and improve on 2011 in 2012. The UK Financial Services Authority tests use an unemployment rate of 12.4%, in contrast to the 10.6% rate for the U.K. used by EBA in its worst case scenario. The actual unemployment rate in the UK was 8% for the 3 months to Jan 2011, according to the UK National Statistics Office....

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On the 100th anniversary of 1947 and 1949 the Republics of China and India in about 25 years will have become fully developed modern states with science and technology by 2050, leaving behind memories of the colonial period. As the mother of Asian Buddhist civilization this region of northern India would be seen by a new generation of Chinese as part of ancient Chinese Buddhist culture from the days of Lord Buddha and Bodhidharma, and a gradual shift will lead to China leaving Tibet and the border regions of India in Kashmir, Arunachal and Ladakh of its own decision. China's entry into border regions- Kashmir region, Ladakh and Arunachal are a result of China under Mao and the Communist party decision to occupy Tibet and Indian border areas. A result of the memory of occupation of China starting from the border regions in the north Manchuria by the Japanese, and the Kwantung peninsula by western powers Russia, Britain, Germany. And the need to protect its frontiers in the border regions used as buffers by the British Empire, after the Communist Party under Mao created the People's Republic in Beijing. New technology in the 20th century made the high plateau's of Tibet accessible after 2500 years by construction of roads rail transport in high mountain terrain.  What this occupation of Tibet as a border region has done is to put China within a short distance, just days from the plains of India- a situation that has no precedent in the entire history of the world dating from Lord Buddha. Compared to the desolate regions of Manchuria in the north this has an Indian population in the plains of India of as much as a billion people. Just as China sought protection from its own memory of occupation by the Japanese and colonial powers, India seeks protection from colonial powers and the Chinese now in Tibet similar to the Japanese in Manchuria just days away from the plains of the Chang Jiang (Yangste) and  Huang He (Yellow River) of China, China just days away in 2025 from the Ganges/ Brahmaputra , and the Indus river regions. The British Empire no longer exists. British names such as McMahon for McMahon Line frowned upon by anti-colonialist China, no longer exist. India also an anti-colonial power frowns upon such names and the arbitrary way the British (also the Portuguese, the Spanish, Dutch and the French) decided what belonged to whom, including whole nations. As early as 1505 Portuguese occupied Sri Lanka (Ceylon), occupied by the Dutch as part of cinnamon supply zone by 1700, and transferred by treaty to British in 1802, the memories of colonialism date back on the shores of India to 1505.    ...

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Spain's National Court is looking into the problems at Bankia and the leadership of Rodrigo Rato, a former head of the IMF and Economy minister in the government of Mara Aznar of the Partido Popular. The current prime minister Rajoy was deputy prime minister in the Aznar government which lost the election in 2004.

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Deocuments from the weekly cabinet meeting show the new budget in France will increase revenues from household income taxes by 23%, and business taxes by 30%. The top marginal income tax rate goes up to 45% from 41%. Limiting a deduction for financial charges for company's taxable income brings in $4 billion in 2013, according to the finance ministry. The goal is to cut the budget deficit to 3% of GDP in 2013 from 4.5% in 2012. The finance ministry has assumed higher borrowing rates for future years- 2.9% on 10 year debt for 2013, up to 3.65% in 2015, and is not relying on the low rate of 2.18% on 10 year government bonds as reported by Trade Web Sept 28, 2012. The overall tax burden will be 46.3% in 2013, and 46.7% in 2015. French debt is at 91% of GDP for the 2nd quarter 2012, expected to be 91.3% in 2013 and falling to 82.9% in 2015. Prime minister Ayrault emphasized- "If we don't put a stop to this, taxpayer money will keep paying for debt reimbursement." Swift anticipatory action and unified government-business-labor posture under a favorable borrowing environment characterizes the approach for Britain and France in 2011-2012, compared to the situation in Spain where government action has been slow, not tough enough in cleaning up the banks, fallen behind in anticipating events and the government-business-labor unified posture has cracked under the strain. As a result under an unfavorable borrowing environment money raised from austerity type tax increases now goes to paying for debt reimbursement in Spain, leading to a situation in which debt and deficit reduction targets just get harder to achieve. A looming drop in credit ratings to junk status for Spain only makes the situation harder to overcome. ...

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A new family sedan will come out of a new manufacturing plant VW has built in Chattanooga, Tennessee, in 2011. The plant will turn out a new version of the Passat to compete with the Toyota Camry and the Honda Accord. Production capacity will be 150,000 A new Beetle will also be introduced. This is the first time VW has built a car specifically designed for the U.S.. During its previous efforts in the 80's VW used European designs and transferred them to the U.S. Its plans are to sell 400,000 VW's in the U.S. by 2013. VW sold 213,000 cars in the U.S. in 2009, so this means doubling sales in 4 years. At it height VW sold 577,000 cars in 1970, but this was before the Japanese and the Koreans entered the market in a significant way, and now the potential is there for Chinese and Indian imports at the low end of the price scale. Another factor making this goal difficult to achieve is the smaller car market and lower economic growth. By 1992, sales had dropped to 49,000, after the boxier replacement to the bug- in its Rabbit and Golf models- never took off. The new Beetle's introduction in 1998 improved sales, which reached 356,000 in 2001, and then declined as a result of too few new models, declining quality and a weakening dollar. There is a feeling among VW's American dealers, that VW's European headquarters staff is not giving the US the priority it deserves. The revolving door change in CEO's for the US operations, has only reinforced this impression. Mr Browning of GM's European operations replaced Jaccoby recently. Jaccoby joined Volvo as its new CEO. Steps taken to address these issues are to revamp the Jetta model for American customer preferences, and advertising that appeals to price conscious customers with the line: "Great for the price of good." Another innovative effort is an ad strategy that tries to capture Hispanics in the US market, with ads on Spanish language television networks. A sign of how much German management is involved in the detail of the new Jetta, is the discussion at the management board level about whether the new model should have American style cup holders. This meant pushing the brake two inches forward towards the driver, a decision that was made to do so after some deliberation at the management board. This will lead to intense competition in the US market, with Asian, European and US manufacturers all vying for the same price conscious customers....