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Nathaniel Tapin says about China's debt laden economy and struggling property developers that this has been seen before. What matters most is the confidence household borrowers have in the country to buy homes and spend versus putting more money into savings. And this confidence that that has been the strength of the economy for three decades is fading. About 12 million jobs in the internet platform economy were lost in 2020-2022. This absorbed a fourth of the Chinese graduating from colleges each year. The manufacturing sector is affected by declining demand overseas and cannot pick up for this. Much of this is a result of Xi's government efforts to tamp down debt of housing developers, to reduce housing speculation, to limit the power of internet companies, and develop a fairer economy, and these were policy decisions not easily reversed. A pervasive pessimism is leading to a disinclination to spend or buy a house. Surveys of Bank of China show inclination to save increased by 15 percentage points to 58% in second quarter 2023. In the past Chinese put money in homes as a way to deposit money in a savings account, homes were sold even before they were built. This cash was passed on to property developers and in turn the local governments benefited by selling the land to property developers. After property developers could not pay interest on debt and collapsed the households decided to pay down their mortgages and $28 billion went to pay down residential mortgage debt in first 6 months of 2023.  ...

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Argentina, South Africa, Mexico, India, UK, European Union elections are taking place by June 2024 and US in November 2024. Yet it is misleading to lump them together. Much discontent is there to see as in the UK with cost of living, governance, time wasted on Brexit, India with lingering effects of the pandemic on rural voters, caste based voting. In India protest vote of lower caste Dalit voters in Uttar Pradesh and Maharashtra, even with government support in forms of universal healthcare, food for poor households during pandemic extended, cooking gas, housing support, clean tap water, direct bank account deposit to accounts of poor and farmers. Yet in the states in the south and east in Orissa and Andhra Pradesh, and generally in the south the BJP vote count increased so that losses in the north were made up leaving the percentage of vote for India for Modi's BJP party at 37 percent in 2024 instead of 38% in 2019, losing the absolute majority 240 seats of 543 yet having campaigned heavily for partners who added seats 294 of 543. In the UK Keir Starmer may see some vote preference for Labor erode yet the Conservative record is in shambles even conservative experts will say, as in India where the opposition parties offer no prospects for the future and little track record for making India the second or third largest economy in the world which the BJP has set and shown to have achieved over 10 years by taking India to No. 5 in the world economies. ...

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Inflation is receding as an issue in the 2024 elections as the CPI index dropped below 3% in July as reported by the Labor Department. It was 2.9% lowest since 2021. Greg Ip says when Trump is saying bacon costs 5 times more now he needs to find another supermarket. That is the joke as Trump is really getting ripped off. Ip says bacon prices are up 18% since 2020 when Biden took office. Trump says at rallies grocery prices are up 70%, Ip says fact correction -up 21% since January 2021 not 70%. Trump says gas prices are $5.00 a gallon. Fact correction- gas prices are $3.75 a gallon and falling, says Ip. Trump wildly exaggerates. Trump says he will cut energy and electricity prices by 50% in 12-18 months. His answer "Drill Baby Drill." Experts cited by Greg Ip say even if new offshore and onshore leases are given, increase in supply is marginal and years away. Gas prices are determined by the world price determined by OPEC and Russia, says Ip.  Trump will increase inflation says this report because of tariffs he plans of 60% on imports from China and 10% from other places. That would increase inflation by 1.4 to 1.7% say analysts. Greg Ip of WSJ offers more clues. Inflation linked bonds see inflation dropping to 2.2% in 2025 instead of 2.6% predicted earlier. Jerome Powell at the US central bank the Fed and president Biden hav done their job well and are not letting up, continue to work on it diligently every day. ...

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Brigid Schulte says French parents can be more relaxed in their parenting because of the reliable state financed childcare system in France. France ranks first in the 34 nation OECD for 100% preschool attendance, with the U.S. way below at 46%. The U.S. is the only country in the developed world that has no federal paid parental leave policy. This puts enormous stress on mothers, and also on fathers who share the tasks of parenting. This is one reason why there is a long tradition of working mothers in France, and why American mothers are constantly having to make choices of staying at home and parenting or trying to juggle work and careers.

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Arthur Brooks, president of the American Enterprise Institute, gives an eloquent tribute to James Q. Wilson, by saying that he gave America social science with a soul. Brooks says of Wilson's book "The Moral Sense," that it truly ranks with Adam Smith's book 'Theory of Moral Sentiments,' as the most significant thinking on this subject. It synthesizes the work of hundreds of scholars in many fields to conclude that man is in his essence a moral creature. In all of creation and man's world there is this profound sense of man grounded in his moral being. It inspired most of his own work as it did for Adam Smith in his time.

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Peter Baker talks to experts on American presidents about Trump's 100 days in office. One expert says the presidency has changed Trump more than Trump has changed the presidency. Trump has told reporters recently that the job was harder than he thought, the decisions requiring much more thought and much harder. Described during the campaign as following instincts, impetuous and brushing off briefings, the Trump that has emerged in the early period is a president who surprisingly has been willing to listen to advice from Republican leaders in business and government. He has also changed course where appropriate on trade with Mexico, China, Germany and other countries, and shown decision making ability where appropriate such as over use of chemical weapons in Syria. He has listened to Muilenburg of Boeing on the Export-Import Bank, his Commerce Secretary Wilbur Ross on NAFTA and Mexico, to Gary Cohn his economic adviser for a careful studied approach on taxes and the economy, as covered here in Lyrarc.  And Trump has built a relationship based on discussions with president Jinping of China, which has helped create a stable climate for world trade and the economy after the ruffled period of the campaign. On NATO and South Korea he has given the lead to his advisers, Gen. Mattis, Tillerson and his vice president Pence. For this to happen president Trump with his exuberant and sometimes volatile personality has shown a capacity for learning and growth over this short period, surprising many. ...

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President Xi Jinping's Made in China 2025 plan has spurred startups in electric car technologies, and raises concern about overcapacity. Electric cars is one of 10 sectors in the Made in China 2025 plan to promote global competitiveness for Chinese companies and domestic dominance. China Construction Bank and National Development and Reform Commission announced a $47 billion plan. Direct government subsidies of $15 billion over last 5 years have also increased the number of startups.

All automakers in China are required to produce electric cars. The electric cars sold in China at 777,000 make up half of the electric cars sold in the world. 

Local governments in places such as Anhui province have invested in electric car companies. One such company Singulato in Tongling, Anhui, is profiled here, with its first electric car expected by the end of the year priced at $43,000.

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A major shift in foreign investment may be taking place as the 2014 St. Petersburg International Economic Forum takes place in May 2014. Russian policy in Ukraine and tensions with the U.S. and Germany could lead to a shift in investment to other emerging market countries. China's tensions with Japan could lead to a similiar shift of Japanese foreign investment. At the same time India has elected a new government with an absolute majority and an overwhelming mandate from young people to accelerate development. The new government under the BJP party's Modi has a decade of experience attracting foreign investment in western India. Indonesia, Vietnam, Africa and other emerging market countries, could benefit from the shift in investment. Investment could also return to the home countries with lower labor costs in Southern Europe, lower labor/energy/transport costs in North America. For Russia the debate at the St Petersburg Economic Forum was about pursuing one of three policy paths with some riskier than others, or some combination also risky and uncertain- depending on state banks and oil windfall funds, increasing ties with Asian countries, continuing on the current path with lower foreign investment and continued capital outflows. The failure to use the time wisely to diversify the oil based economy which could have been better accomplished in an economy not overly dependent on crony capitalism and centralized economy, both current characteristics, will affect future progress. A key weakness for Russia compared to China is the centralization under one person Putin, more so in the third term. In China the two man team Keqiang and Jinping is part of a larger team chosen by consensus and negotiation and part of a rotational scheme. It has senior leaders who initiated the changes to a market driven economy in the nineties determined to see China on track....

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Geoffrey Hinton, a pioneer in the development of AI, resigns from Google and warns about the dangers of AI. He says AI poses profound risks to humanity and society. He says it is hard to see how bad actors would not misuse AI for bad things.

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This report in The Guardian shows that ChatGPT is nothing new. The first version of this kind of generative AI was developed in 1966 at MIT by a computer scientist Weizenbaum, who called it Eliza. The buzz around it like that around ChatGPT was that it was thinking and acting on its own, the way humans like to think it did, but in fact Weizenbaum showed that it was simply code written to take what was given to the computer as input and spitting it out in a different way that made it look that it was acting on its own, when it clearly was nothing but parroting it out like a parrot. The issue of turning our world over to robots based on AI is controversial and even dangerous. A Japanese futuristic movie shows how the man who has written the code for the master computer that runs everything in Japan is disillusioned about it and finds himself in a nightmare world where the machine tries to isolate and eliminate the man who created it. Machines cannot think or have emotions like humans do and it is these emotions, rethinking, that the world depends on for its survival. Can anyone say that a machine would have made the decision that Chinese president Jinping just made in January of making a complete u turn and moving away completely from lockdowns into a complete opening with a plan that appears to have worked and is reviving China's economy following the street protests by informal groups including young women? ...

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Without human consciousness Ai's simply lack the vital elements of what makes us human. So called intelligent behaviours don't amount to much in this the most important aspect of our behaviours that makes us human in the way we have evolved over long periods of time. A recent Japanese movie showed how even the creators of AI that runs things in a futuristic Japan find themselves trapped in an AI run society, and how AI fails Japanese society.

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Rina Bliss, a professor of sociology at Rutgers, says while AI can bring information to kids it cannot make them think. To truly learn children will have to do it themselves and in interaction with teachers, parents and other children. She took the approach of a scientist and let her two children try out AI tools and software and came to this conclusion. One reason she says is that AI is based on computational intelligence and the human mind and brain are not quantifiable. The brain is flowing like a river and always learning from its environments.  There is a social environmental piece says Marin, there is interaction, there is a drive to know and connect, curiosity and passion that are part of learning.  Basically AI is developed through taking vast amounts of information collecting it and ordering it in a certain way. How each originator of the AI orders it affects how it will work. And what is in the basket of information collected will affect how it will work. There is no thinking brain outside of the human originator who put a particular version together. Like every piece of software there are implicit or explicit instructions on how to use the basket of information collected that is put in by an originator who developed the AI software. For these reasons it will only do basic tasks and is not intended for complex tasks that involve thinking processes and social-emotional aspects of human behaviour. The risks of using it begin to grow as soon as it is used for tasks it was never intended to perform such as replacing the human thinking  processes and the socio-emotional aspects of these processes.  If it is used to do things it was never intended for, the larger the activities it performs, the larger the mistakes and risks it it is liable to make or create. If it is assigned the task of transportation for a country, it will at some point be asked to think and at that point it will fail to make the right decisions, making the risks grow exponentially, very, very fast, leading to disaster. ...

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Alan Meltzer is a respected voice on US Federal Reserve policies since the time Paul Volcker was Fed chairman He says the Bernanke Fed is making some serious policy mistakes. The first is concentrating on near term events, such as business response to Obama administration policies, over which it has little influence, while neglecting the long term consequences of its policies. The second is its effort to tackle unemployment by interpreting its mandate as a dual mandate of tackling both unemployment and inflation. By tackling one at a time, he says, the Fed is likely to fail totally. The US is unlikely to not feel the inflation that is going on around the world. By ignoring the changes in money supply growth the Fed is making another mistake. His advice is for the Fed to increase interest rates it controls to 1%, to signal that it is aware of inflation risks. Second, the Fed should annonce a specific, detailed plan explaining how it will reduce $900 billon of the $1 trillion banks continue to hold in excess of the legally required reserves. Third, the Fed should end QE II, the most recent round of treasury bond purchases. Meltzer says if the Fed waited for two more months in Nov 2010, it would have found that a double dip recession was not about to occcur and it could have held off from pursuing QE II. Meltzer emphasizes that slow growth and unemployment is not a monetary problem, because of the ample liquidity already in the financial system. Uncertainty about government policy and the future direction has been clarified by the election which will help put the economy back on track. Philadelphia Fed chairman expresses similiar views in other articles and an interview with O'Grady of WSJ....

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How a new financing mechannism with a private-public partnership is helping India sole severe infrastructure problems when government deficits make public financing inadequate to meet India's needs. Note that the IPO for GMR Infrastructure which has the contract to develop Delhi's airport was fully subscribed on the first day it opened, July 31, 2006. GMR hoped to raise $170-200 million through that issue. Private investment comes from loans from India's public sector banks which are flush with cheap money. Crisil , a rating agency, is quoted as stating that lending by banks to infrastructure projects has grown from 2% to 15.5% in 7 years to 2005. Financing through the corporate bond market for infrastructure projects is something that has not been tackled so far.

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Economist Paul Krugman says Gordon Brown does good. Gordon Brown Britains Prime Minister has taken the lead and the initiative to give a proper direction to the rescue efforts of the USA, and the G7 countries. His plan to inject capital into financial institutions and a host of initiatives was done speedily, intoduced Wednesday, October 8, 2008 and to be executed starting today, Monday, October 13 with some of the first capital infusions and other steps. In giving direction to Paulson who has agreed to take the direction of Gordon Brown after some faltering and missteps and in properly guiding the whole of the G7 Gordon Brown has done a lot of good. Which goes to show that the British public may have underestimated and underappreciated the quality of leadership Gordon Brown can show in a crisis, (considering his low poll ratings), which is where it really matters and where its sorely needed, especially when its for the global financial system.

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Koizumi's legacy 2001-2006, five years of change and a break with the past in Japanese economic policy. Sebastian Moffett review's Koizumi's achievements, bringing Japanese government and policy closer to the people bypassing the bureaucracy and ministries, appealing directly to the people and carrying on conversations with the public on television on critical economic policies such as privatization of the post office savings accounts system, and hiring newcomers such as Takenaka to implement reduction of bank debt that stifled Japanese economic growth. Koizumi also created an effective Prime Minister's office to execute policy and provide new directions to Japan.

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Thirty minutes after trading started at the Shanghai Stock Exchange on Jan. 6, 2016, circuit breaker mechanisms were triggered following a decline of 7%. This followed a similiar circuit breaker trigerring on Jan. 4, 2016. This time investor anxiety was over a devaluation of the renminbi by the government. This triggered a drop of 3.5% in Germany's DAX index and 2.2% in the S&P 500 index. Faulty communication and confusing signals to markets by the central bank PBOC, and securities regulator CSRC, also played a part in increasing investor anxiety. Similiar problems were seen in summer 2015.

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Does it help to be an organization man, do organizations provide protection against the buffeting storms of life, against this economic crisis and everything it may hold in store? The publisher of the Rocky Mountain News is out of ajob an a free agent. suddenly the postwar security of a job with a large company is gone. You could be in sales with a pharmaceutical company, in the auto industry, in a newspaper, working for a local government, a bank thats disappearing, in a small business, or in some other business, and your job could disappear in a contracting economy.

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Government agencies such as the Export Import Bank charge airlines for their guarantees. The new agreement reached through the OECD in Paris, replaces the fixed fees with charges that follow prevailing interest rates. The previous subsidy deal in 2007 has been updated in this way. Airlines use the export credit financing to lower their cost of borrowing and increase their access to loans. Participating governments, including the US, the EU, Japan, Canada and Brazil, aim to approve the deal by Jan 20, 2011. Russia's Sukhoi Superjet 100 and the ARJ21 regional jetliner in China, will be exempt from the new rules.

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The Rousseff administration announces plans to cut $30 billion in 2011 spending. Inflation is up by about 6% in January. Most of the cuts says Finance Minister Mantega, will be achieved by cutting earmarks added to the budget, and by slowing hiring in the public sector. But analysts say this will not be sufficient to control inflationary pressures, as 2011 spending will still be above 2010. Higher inflation puts pressure on the central bank to raise interest rates at an high of 11.25%, which in turn brings in speculative money and creates a highly overvalued currency.

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Recent trade data show improvements in the current account deficit of Ireland, Portugal and Spain. Ireland is in surplus since the second half of 2010. Spain has reduced its deficit to 3% with a 12.5% increase in exports. Deutsche Bank reports show the aggregate current account deficit of Greece, Ireland, Portugal, Spain and Italy going from a weighted average 10.9% of GDP in the 2nd quarter of 2008 to 4.3% by the 3rd quarter of 2011. This provides a ray of hope that the rebalancing needed in Europe can happen without putting a large burden on falling wages relative to Germany.