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The lack of trust in negotiations on the terms of spending cuts between Greece and EU ministers in February 2011. In difficult exchanges between German finance minister Schauble and Greece's finance minister Venizelos, Schauble criticized the Greek government for not beginning negotiations for reduction in the minimum wage. EU ministers at a meeting with Venizelos on Feb 10, 2012, showed a distrust of Greece's figures on austerity cuts and asked for an additional $428 million in cuts to make up for the refusal of Greece to cut supplemental pensions. In Greece five ministers in the Greek cabinet resigned in protest over the conditions set by the troika of the EC, ECB and the IMF, just as unions launched a 48 hour strike in Athens. Greece is in the fifth year of a recession with unemployment at over 20%, making sharp cuts more painful. A shrinking economy makes achieving budget defict targets even more difficult and worsening the debt situation.

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General Electric, GE, experienced a steep decline in the last decade. The worst news came in 2018 with the loss of half its share price and market value. One story tells about an employee who was forced out of retirement back to work seeing the loss of value in GE shares in 2018. Rarely has a company of this size seen a fall in stock price this steep, for a stock that was once seen as safe for widows. About 60% of GE business comes from jet engines, electric power generators and wind turbines. GE now plans to sell its health care business and other business that do not relate to core infrastructure in energy, aerospace, and other markets. Under Jack Welch a faulty model of adding diverse businesses that had nothing to do with its core business and expertise in infrastructure were added. A home mortgage lending business was added and GE Capital expanded. NBC Universal was added with little justification in a period when CEO's acted without much consultation. The home mortgage lending unit collapsed with large losses during the 2008 financial crisis and GE's share price dropped drastically to $6.00. Under Welch's successor Mr. Immelt the GE Capital unit was shrunk in size, but losses continued to mount. An oil field service unit was added which also sustained losses.  Immelt's successor Flannery faced a loss of $15 billion from the financial lending unit. Sale of some businesses was not sufficient to meet the loss. Flannery is now taking GE out of all the businesses which were not core business. The NBC Universal television business was sold to Comcast in 2013. GE Healthcare is next. This closes a bad chapter in GE's story under Welch and Immelt. GE's dividend was cut for the second time since the Great Depression. The story of GE is also the story of American business during the last two decades, with icons such as GM, Ford and GE suffering decline, businesses that operated like little fiefdoms of old nobility in Europe, with CEO's operating in a CEO centric culture, not tolerating contrary opinion for informed debate on issues facing the business. Alfred Sloan founder of Genral Motors called constructive debate central to good management. Later Intel CEO Andy Grove coined the phrase constructive confrontation as a way of constructive debate, and the CEO was shown as the first of equals. The CEO centric management ignored these warnings and admonitions in running their fiefdoms.   ...

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The steep decline in popularity of French president Emmanuel Macron in the period of one year. With the yellow vest protests on the economic insecurity of struggling families, Macron's efforts to bring in business friendly policies as a change agent are itself out of step with the times and with France in the provinces and small towns, as pointed out in the New York Times and Times of London analysis of the situation in France today.

As pointed out in the analysis Macron's base itself is small and its anti-institutional posture rejecting conventional politics itself has given momentum to the current yellow vest protests about economic insecurity of struggling families. The support for this comes from all parts of society and single political party, without nationalism, race or migration as factors at all, and comes so soon in one year from the time that Macron emerged with his own movement rejecting the institutional structure.  

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Posturing and negotiating between Republicans and Democrats on deficit reduction before the "fiscal cliff" of automatic spending cuts and tax increases on Jan. 1, 2013.

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DJT 1.0 was led on the tariffs policy by USTR Robert Lighthizer, who had experience negotiating with the Japanese negotiators in the Reagan era. He is today respected by  Republicans, is seen in an important role in economic policy and to prepare the tariff policy actions of the new DJT administration. Lighthizer prefers to get Congress to take action with legislation. He also believes that domestic manufacturing will make gains with new and higher tariffs on Chinese imports. Lighthizer policy is falsely compared with Hoover Tariffs Act of 1930 when world trade was 9% of world GDP, today it is 63% of world GDP, and where under Hoover in 1930 the tariffs were across the board all countries 20,000 goods. Under Lighthizer on specific products where dumping is happening -steel, aluminium, autos, with Japan in 1960-70 or China 2000-2020 targeting American industries + technologies for takeover. And falsely when it comes to raising costs to each American family on average by $4000 a year by economists. The conventional view for business for 2000-2016 through Bush and Obama favoring free trade did not take into account the unusual experience of China which entered WTO in 1990, then expanded in a way unprecedented in history at 10-12% growth rates for 15 years destroying American manufacturing with dumping, having support of outshoring by companies in the US, and not giving reciprocal treatment for exports from the US to China. China also had unrestricted access to US technologies in this type of trade. Lighthizer's approach was to specifically address this problem not a general across the board tariffs on all goods (20,000 goods) on all countries as with the Hoover Tariffs Act in 1930. Lighthizer's approach adopted by DJT called for reciprocal trade response with China as the US had already done with Japan, not unilateral across the board tariffs, and when world trade had advanced to about zero tariff rates. And falsely compared to Hoover 1930 Act because under Hoover tariffs were 29-40%. raised to 60% when world trade was small, was 9% of GDP. The Biden administration has tacitly agreed with Lighthizer's vision by not reversing DJT tariffs. A new higher tariff will probably be selective based on the industry, country and what goals the US has set under the new administration for that industry. Some of the tariffs revenue may also be used for tax cuts. ...

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GDP growth in the eurozone was 0.3% for the 4th quarter 2014. For 2014 eurozone GDP growth was 1.4%, according to Eurostat. Growth in GDP for Germany was 0.7% for the 4th quarter and 2.8% for 2014. Retail sales in December were particularly good in Spain and Germany, with sales up 2.8% for the eurozone over the prior year. Italy's GDP growth was stagnant and France's was 0.1% for the 4th quarter, showing that Germany and Spain are leading the way for eurozone recovery.

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Efforts to change labor laws by Italy's prime minister, Mario Monti.

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Martin Feldstein points out why the recent agreement for a "fiscal compact" is no more than an empty statement about fixing the eurozone's finances. In this respect it is no different than the Stability and Growth Pact it replaces, with serious weaknesses. Feldstein cites the weaknesses in the language of the agreement. Each eurozone country is required to limit its"cyclically adjusted" budget deficit to 0.5% of GDP and bring its debt down to 60% of GDP. Compliance will be performed by the European Court of Justice and fines imposed. In practice the questions loom large- for a country like Spain with a 23% unemployment rate, isn't all of the 6% budget deficit cyclical? Again the agreement says deficits are calculated "net of one-off and temporary measures." Under this provision a lot of the stimulus programs would be considered in the category of "one-off." Other language lets eurozone countries frame budgets based on "exceptional circumstances" and "periods of severe economic downturn." Italy has declining economic growth, does it make sense to have a large budget surplus in that situation to lower debt to GDP, and how does that goal relate to "exceptional circumstances."...

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House Majority Leader Eric Cantor rejects the McConnell plan for raising the debt ceiling. Senate Minority Leader McConnell says on a conservative talk show- "all of a sudden we have co-ownership of a bad economy. That is very bad positioning going into an election." McConnell's plan is to shift the responsibility for raising the debt ceiling to President Obama, by separating debt reduction talks from debt ceiling talks. Cantor believes its best to push on with cutting back spending. Obama's response was to offer $1.7 trillion in spending cuts, at which point he expected Republicans to support tax increases, telling Cantor in negotiations "enough is enough." The McConnell plan is supported by Senate Majority Leader Harry Reid and Republicans in the Senate. The details of the plan are being are being worked out, with one strategy being to add to it the $1.5 trillion in spending cuts identified in bipartisan talks with Vice President Biden. Both sides are looking at this jockeying for advantage for the 2012 election. At one point in the talks with Cantor, Mr Obama is reported to have told him- "Eric, don't call my bluff. You know I'm going to take this to the American people." Cantor for his part, wants to limit the duration of the debt ceiling increase so that it would be a short term extension and would come up for a vote before the 2012 presidential election....

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The stories of Dylan Roberts, 32 years, in Rockford, Illinois and Alfred Butt, 42 years,in Hohenlockenstedt, Germany. Roberts lost his job at aChrysler plant in Belvidere, near Rockford, Illinois, and Butt lost his job a German auto parts maker. Roberts gets a $64,000 severance package, and 59 weeks of unemployment insurance, with apossible additional 13 weeks, with monthly check of $1426 that is 27% of his income of $64,000 a year when employed. attribute 33 weeks of the 59 weeks to the stimulus measures of President Obama. Butt has 4 months as atransfer worker at full pay, which can be as long as 1 year, then he has till May 2010 at 80% of his pay when employed full time of 2700 euros amonth. The transfer company gives job training and job hunting advice. He continues getting his medical insurance benefits which are provided by the state. Roberts loses his health insurance with his job, and hopes to pay his expenses for a2 bedroom apartment with his girlfriend who makes close to $1500 as an elementary school teacher. He will take a2 year electronic engineering course with a local college using $6000 from Obama's Dislocated Worker's Program. But he isn't sure if he can do his studies after one year when his unemployment benefits expire. Butt can afford to take a vacation to Cyprus and his lifestyle is not much affected he says. His wife works as a nurse at a rheumatism clinic. Butt is like the 64% of Germans who say the crisis is not affecting them personally. Roberts is like the 87% of Americans who say this crisis id hurting them in their persdonal lives. To pay for the state funded benefits the total wage tax burdenas a percentage of labor costs for Butt is 52% in Germany. FOr Roberts it is 30% in the USA. France is at 49% Spain at 39% and the UK at 34%. Germany's public expenditures for these labor benefits are 2.97% of GDP in 2006, the USA's are 0.38%. Spain and France are at 2.32% and the UK at 0.61%. This also explains why the impact in countries like Germany and Spain is not felt so badly as in the USA. In SPain there is also the lower mobility and the safety net of family support helping people cope making it possible to cope with 20% unemployment without serious distress and hardships. See the link to Spain's unemployed....

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The mortgage interest deduction mostly benefits wealthier people with larger mortgages who need it least, and who are likely to buy homes regardless of the deduction, say experts. Both the Brookings Institution and other experts such as Moody's chief economist, Mark Zandi, see the deduction as part of the negotiations for deficit reduction. The Brooking Institution's Ted Gayer, says the deduction subsidizes acitvity such as borrowing large amounts of money to buy larger homes which the U.S. should not want to subsidize in the current state of the country's finances. The Simpson-Bowles plan and the Feldstein-Romney plan sought to put unnecessary tax expenditures and deductions on the table for negotiation. The deduction was not part of the last tax reform in 1986 under president Reagan. Zandi says any changes should be phased in over a number of years so that housing sales ar not affected in the current recovery. David Stephens, CEO of the Mortgage Bankers Association says any changes should be implemented gradually. ...

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Ben Inker of Grantham Mayo sees profitability at U.S. companies at a high because of savings in labor costs while consumption has not declined because of government transfer payments and fiscal policy. He sees profits of U.S. companies declining in 2012-2013. This makes the U.S. stocks less likely to perform well in the future, especially the stocks outside of the blue chips which he sees as highly overvalued. A better choice in his view is in Europe and Japan which are undervalued. His funds have 39% in U.S. stocks and most of it in blue chip stocks. His view is that interest rate policy will not have a large effect as the changes will be very gradual, and going from zero percent interest rates to one percent interest rates will not lead to much change in economic activity. From his point of view the largest risk is in shrinking of profits at U.S. companies as the deficit comes down, because today workers are able to maintain consumption because of fiscal policy and companies are able to cut costs. In Europe the austerity cuts are being taken seriously and this will impact profits, so the U.S. will look better in 2012. But value will prevail in the long run as European and Japanese stocks are undervalued and the U.S runup leaves stocks overvalued in terms of future stream of profits....

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Comments by the banking sector and the central bank of Canada on the Volcker Rule.

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Experts in the U.S. say the U.S. made a mistake in not supporting the idea of a new financial institution to meet the urgent needs of development and infrastructure financing of Asia's developing countries. India, Australia, S. Korea, Britain, Germany, France and Italy are joining as founding members in 2015. China has offered leadership in providing resources for the new bank. Jane Perlez says China is looking for the best talent worldwide to help write the charter for the bank and to run it. It is a project pushed forward by China's president Jinping, and was discussed at the 2013 G-20 meeeting in Moscow as a critical part of the agenda. Laurence Brahm, who supported Chinese premier Zhu Rongji in 2001 for entry into the WTO, says it is natural for China to look for ways to use its extra capacity in steel, concrete and pipes to build projects in other parts of Asia, which would mutually benefit China and the region. Paul Haenle of the Carnegie-Tsinghua Center in Beijing, says the U.S. lack of support is shortsighted, as the existing U.S. sponsored institutions World Bank and the Asian Development Bank are sorely lacking the resources to deal with the huge infrastructure challenges in Asia. China's Finance Ministry is looking for the best talent worldwide to write the charter and run the bank. Natalie Lichtenstein, a lawyer with 30 years experience working at the World Bank will write the bank's founding charter. ...

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Liberal groups feel president Obama has lost the leverage he had after the McConnell-Biden fiscal cliff deal of Jan. 1, 2013, saying this only sets the stage for talk of spending cuts.

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A new study by the Washington Post and the Kaiser Family Foundation shows partisan politics will affect the new president in the U.S. in 2013, to the point of making it difficult to govern.

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The New Democracy party of Antonis Samaras won 29.6% of the vote and came in first in the second round of presidential elections in Greece, ahead of Syriza party led by Alexis Tsipras. The Socialist Pasok party won 12.2% of the vote. Tsipras says he will not form a coaltion government with Samaras, and prefers to remain a leader of the opposition in parliament.