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The head of Ford Smart Mobility unit becomes the new CEO of Ford Motor Company succeeding Mark Fields. Under Fields Ford's share price declined by about 40% since taking over from Mr. Mulally in 2014. Tesla's share price has overtaken Ford Motor and Silicon Valley is making investments to reshape the auto business.

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The dollars situation may not be as bad as it looks. There are signs that the dollar is strengthening against the British pound and the Australian dollar and other important currencies. And the weaker dollar is already working to reduce imbalances in America's trade deficit. There are two aspects of the dollar's role, one is as a means of international exchange and the other as a store of value. For the first reserves of any country need to be highly convertible and America offers highly liquid markets and this has not changed. As a store of value the dollar has lost some of it value especially against the euro. But the reason that the dollar should not see a sudden drop in value is because the largest holders of dollar reserves China with $1.4 trillion and Japan with $1 trillion would stand to lose by shifting out of dollars significantly at atime when the dollar was so undervalued besides hurting their export markets if it affected the US economy. And though the euro looks good in the short term, over the longer term Europe's aging societies may see lower growth and the future may look different once the USA has corrected some of it imbalances which is precisely what the weaker dollar accomplishes as the US exports start humming. Seen against the historical background the USA has periodically gone through this situation with dollar weakness in 1977-79, 1985-88, 1993-95. In 1985 the dollar went to 81 Japanese yen and there was concern about its reserve currency status at the time. However the dollar has weathered these storms. And there is always the option for a country to peg its currency not to one currency alone but to a combination of the dollar and the euro. This was the case before 1914 when 3 currencies the British Pound, the French Franc and the German Mark were used. In the post 1918 environment the dollar replaced the German mark alongside the Pound and the Franc. The Persian Gulf countries have this option so they can use their own monetary policy to control inflation by pegging not just to the dollar but to a basket of currencies as Kuwait has done. See the link to the Persian Gulf countries handling of this currency issue in WSJ, November 20th and Nov 1, 2007....

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Samsung to build a $670 million plant in northern Vietnam to build mobile handsets. Samsung officials cite lower costs as a key attraction. This shows the trend for manufacturing to shift to lower cost regions as wages rise in China.

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Biden calls ending the war in Afghnistan a "wise decision" for the American people. He says in his foreign policy speech that "it is about ending an era of major military operations to remake other countries." A Pew Research poll shows 54% of American adults support the decision.  In a sense the decision had already been made. Biden cited the Doha agreement president Trump signed a year ago with Taliban that called for the release of 5000 Taliban prisoners which included most of the top commanders, and no agreement on the future of Afghanistan. The decision had come much earlier than that when the wars in Iraq and Afghanistan from the period of George Bush were rejected by the American people for the cost and lack of purpose during the presidential election of 2016. That period marked the rejection of policies set under Reagan, Bush and Obama for starting American involvement in the Iraq-Iran conflict first on one side and then on the other side. All the time precious resources that were needed for infrastructure and services in education and healthcare were diverted to these wars, impoverishing America and also Europe. Looking beyond the words thrown around for political advantage both Trump and Biden and the American people, had decided to put these wars behind them 5-10 years earlier. Biden said assertively that America had made a tragic wrong turn, that was all he could say about Reagan, Bush, Obama policy. In the meantime he stated something else was happening- the US was losing its position in the world by wasting its resources in these wars that do not serve the interests of America. "There is nothing China and Russia would want more in this competition than the US to be bogged down for another ten years in these wars."  Biden was saying that he had the courage and tenacity to make a decision that was the right one and a wise one for America against all the transient opinion of people who lacked a grasp of what was happening to the American people- the increasing impoverishing of America in both rural and urban areas. And a similar situation in Europe. It was time to take a new turn, close this chapter, and write a new one in American history, brighter and with new sense of hope. ...

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GM's relationship with Shanghai Automotive Industry Corporation is the singlemost important relationship for the company. Its 50-50 joint venture with SAIC has sales volume of 2.6 million vehicles, 30.5 billion dollars in revenue, and earned GM a profit of $1.5 billion in 2011 for operations in the Chinese market. In 2009 just before seeking bankruptcy protection GM gave SAIC 51% ownership in exchange for a $400 million credit line GM used for its Korean operations and $84.5 million. Now that GM has recovered it has sought to restore its 50-50 role in the partnership. In a new agreement reached with SAIC, Shanghai GM will be split in two parts- a sales arm which will book revenues in which SAIC will retain a 51% ownership, and a operating arm in which the old 50-50 partnership is restored. The operating arm is where the budget will be set, product decisions made, hiring done including the next CEO. Under the arrangement made before bankruptcy GM retained a call option to buy back the 1% stake, as long as SAIC was able to book revenue. VW also has a 50-50 partnership with SAIC. Shanghai GM has a 14% share in the Chinese market, with a 41% increase in sales since 2009, making it spectacularly successful for GM. This is the largest market share of any company in the Chinese market, with VW coming in second. GM and SAIC also operate a venture in India. ...

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This article in the Economist magazine points out that official data do not accurately show the health of the banking sector, with large number of bad loans at smaller banks. Bank shares it points out are priced in a way that reflects bad loans at 5-10% of loans.

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June 21 is designated International Yoga Day by the United Nations. India celebrates International Yoga Day with 35,000 children and adults doing Yoga in central Delhi. Narendra Modi leads the effort to promote yoga for fitness and health. Yoga research centers are being established to improve health and treat diseases such as diabetes alongside modern medicine. Yoga day practice sessions of yoga were organized throughout India, with the participation of millions of people. Yoga Day activities in Paris, France, included a outdoor yoga session below the Eiffel Tower. In his address to the UN General Assembly on September 27, 2014, Narendra Modi said about yoga: "yoga is not about exercize, but to discover the oneness with oneself, the world and nature." It is part of a 5000 year old tradition from ancient India that promotes meditation, spiritual development and health. This ancient tradition is gradually being revived and is useful in India, China, the Middle East, the U.S. and other countries that see the spread of obesity, diabetes and other health problems. It helps improve spiritual concentration of mind, and increases the body's vital energies....

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President Hu Jintao at the opening of the 17th National Congress of the Communist Party of China. China's goal is to quadruple per capita GNP by 2020 compared to 2000. Population is expected to increase by 200 million people by 2020. While he described rampant corruption, the degradation ogf the environment and disparities between the urban and rural areas andbetween the coastal and interior areas as the major challlenges facing China he gave few details on how he planned to meet these challenges suggesting that not much that is new is being planned to address these challenges. He also pointed to the need for consumption driven growth moving away from the present export driven growth, but offered few details on how this would be addressed. This suggests that while Chinese leaders recognize some of the challenges facing them they may not understand the severity of these challenges as time passes or they have not the will to address them with major changes in the current model of economic growth or that the momentum of th currrent model is so great and the power is so spread out in China between different provinces and local regions in meeting economic goals of GNP growth that the central government cannot make major changes withouth the whole system losing some of its momentum and they fear that that would lead to problems that they would be even less effective in dealing with and the system could then come apart with the Communist Party being unable to direct things as the "core" leadership of the country....

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China risks a steeper fall in the value of the yuan with capital outflows following its policy of gradually weakening the yuan in 2015-2016.

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After overly aggressive bank lending following the financial crisis of 2008 China is now badly overextended. China has also learned from the U.S. experience about the risks inherent in growth generated from a credit boom. In 2009-2010 China was also getting less bang for the buck in terms of the increase in lending needed to generate growth compared to earlier periods. Orlik says don't expect China to help the global economy the way it did in 2009-2011, and that there is no Plan B for China.

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Charlie Rose's interview with Gao Xiqing, the head of China Investment Corporation, China's Sovereign Wealth Fund.

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Rapid growth in SUV sales in China in 2011-2014. SUV sales increased by 49% in 2013 over 2012.