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In depth interview with Kyohei Morita, chief economist of Barclays Capital, Finance Asia explores different aspects of the Japanese economy and developments after 1987 and under Koizumi, the role of exports and how ordinary households are affected. He points out a few important things about the Japanese economy that are not generally recognized. One is that Japanese banks are vulnerable in the way the subprime crisis has exposed banks in the USA. Their vulnerability comes from owning 15% of the shares on the stock market which came down from a higher number after years of reducing stock holdings. When the Nikkei drops below 9000 this reduces the bank's capital and leads to credit tightening. Morita points out the risk of turning a moderate slowdown from lower exports into a severe slowdown if banks are reluctant to lend. The other point he makes is that small nonmanufacturing companies in Japan have to thrive for Japan to thrive, but he is bearish about private consumption. In a revealing statement he says that in his research he has found that the path connecting corporate profitability to households is seriously eroding. This is due to globalization as Japanese companies are offshoring aggressively, and 30% of the Japanese market capitalization in held by foreigners. His point is that Japanese managers now tend to see wages as costs just like American managers do and not the way they did in the past, so salary costs are suppressed in favor of shareholder dividends which flow out of Japan. Finance Asia referred to an OECD study that shows Japan's ranking in terms of per capita income fell from fifth highest in the OECD in 1992 to 19th in 2002, a fact that Morita recognizes as strange as western economies have tended to follow relatively stable long term income growth, and which he attributes to Japan's terrible demographics with population shrinking since 2006 and more elderly and retired supported by a smaller percentage of working age people. In an exceptionally revealing statement Morita points out that Japan has globalized from the outside but not from the inside. Japan he says needs more foreign direct investment and ideas, and more immigrants, fresh labour and fresh taxpayers. Which is remarkably true as Japan tends to be rather insular as a country and tends to keep out immigrants. The influx of Polish and Eastern European immigrants to the UK under the Blair-Brown Labor government years would be unimaginable in Japan. In the meantime Japan's estimated $15.7 trillion in financial assets held by households or three time national GDP is something that makes it possible for now for Japan to sustain the upward trend in the debt to GDP ratio....

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The EU summit under the presidency of Germany completes its task for setting up the European Recovery Fund and providing nonrepayable aid to countries hardest hit by the pandemic that would otherwise have to spiral their already high debt levels to unsustainable levels or provide little assistance to their suffering public. These countries include Italy, Spain, Greece mostly in southern Europe. Also needing aid are eastern European countries Hungary and Poland. For the first time the European Union is jointly taking on this debt of nonrepayable aid to member states most in need. This is a historic step. The Dutch prime minister, almost ruined the solidarity of Europe with his continual effort to cut the amount of funds and place conditions. The Dutch have favored austerity in Europe but at what cost and at what does it say about the Dutch in Europe. Reports show the Netherlands have gained back billions of dollars that would have gone in taxes to the governments of France, Spain and Italy by setting up tax haven. The Netherlands population 17 million, Sweden population 10 million, Denmark population 7 million, together make up less than half the population of any one of the major countries of Europe, Spain and Portugal, France, Germany, Italy. The combined population of about 350 million people in southern, eastern, and western Europe was arrayed against these 34 million northern countries in the long negotiations, that show solidarity but are also a sign of the changes in Europe as these countries in northern Europe were always guided by their own personal or country interest. Rutte fought hard because of elections he faces a second time against the far right wing parties, for a second time since the 2017 election. It could not get more personal than that. Even Britain if it was still in the European Union is likely under Boris Johnson to have reversed policies of Cameron to support solidarity in Europe and aid for recovery, considering how the government has tackled the pandemic in Britain. Setting conditions would only go part of the way is the reality today. The bigger part of preventing mismanaging of funds comes from the individual experience and hardship of people in southern European nations of Italy, Greece, Spain and other countries after the missteps in the eurozone finances in the last two decades. This provides the necessary dose of internal financial discipline. Not acting quickly in solidarity today would have been a serious mistake for Europe. Still Mr. Rutte and the Dutch have cut the European Recovery Fund's nonrepayable aid by 110 billion euros from the initail target set by Macron and Merkel of 500 billion euros. The agreed target now is $390 billion euros. ...

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The tensions that exist in Australian society, as a result of the large Chinese investments and imports of infrastructure building commodities such as iron ore, natural gas and other commodities. Australia's Pilbara region in the northwestern part of the country, has become one huge quarry for China, as an estimated 1 million tons of iron ore raw material is loaded onto 2 story high trucks each day- with automated driverless trucks system being implemented- and shipped by 2 mile long trains to waiting ships on the coast. Australians remember this done on a smaller scale in the 1980's by Japan. At the time Japan brought in Japanese workers. The same is true today but on a bigger scale, with China bringing in workers with lower pay. The concern now is what it was then, as one local leader put it- are we going to have towns with mines or mines with towns, he asked. The mining companies are looking at it purely as a commercial venture, and not investing in the towns. The towns now fear they will find the boom times gone someday and nothing tangible to show for it, no schools, hospitals and no infrastructure. And because the mining project companies fly people in and out, the 8000 aboriginal people in Pilbara- the original people of this land- see little of the mining expansion's benefits. Wandoan, a small place with 300 homes in the outback in Queensland, in eastern Australia, is an example of the gut wrenching change taking place in the mining areas. The lives of the people from the local pharmacy, the local supermarket, and the local ranchers, depend on the mining decisions made in China. This area was part of a planned, on again off again, $6 billion coal mine -part of a A$150 billion complex of natural gas and coal projects for exports to Asia in Queensland- and involved Xstrata buying 70,000 acres of the best grazing land for 7 coal mines. With the locals selling off, the mining uncertain, the supermarket closing, the whole town has the feeling of being up in the air, and fading out someday. Australian public sentiment recognizes this feeling, and at the same time is ambivalent about the impact. Polls conducted by the Lowy Institute for International Policy, show 73% of Australians feel Chinese economic growth has a positive impact, and at the same time 57% feel that there is now excessive Chinese investment, and 46% feel China will be a military threat in 20 years. Australians remember the same feeling about Japan's investments in raw material sources in the eighties. In 1988, polls then showed 70% of Australians saying there was too much Japanese investment, even though they also recognized that Australia had benefitted. The difference now is that there are also fears of China's influence, and foreign investment guidelines limit investments in Australian mining companies to below 50%. China's investment in Australia's natural resources comes in several ways: in the year upto July 2009 A$42 billion in export demand, A$3 billion in direct investment in Australian companies, and about A$5 billion in project financing. Iron ore sales to China amount to A$22 billion each year, and about one fourth of Australia's exports went to China, growing at a rate of 31% in 2009. According to the chief economist of Austrade, the government trade organization, Australia benefits from the economic relationship with China- this adds A$3,400 per year to every Australian household. Efforts to use some of the profits made by mining corporations for infrastructure and other public purposes, by increasing the mining tax have failed; as the mining industry launched a campaign against the government of Kevin Rudd, who was removed from office by his party. In the recent national elections, the ruling Labor party lost its majority, after losses in the resource rich states of Western Australia and Queensland. In the meantime the Australian currency has become the currency used by currency speculators who cannot use the yuan to make a bet on the currency- as the yuan is pegged to the dollar- and instead use the Australian dollar as a proxy. This makes it volatile, with the Australian dollar losing 10% of its value in a single day, when pessimism increased about China's growth forecasts. It also shows how much of the good story of employment and gdp growth in Australia is tied to the story in China, and the extent of the negative impact a reversal in this area can mean for Australians; especially now that the bad debt in the post-2008 explosion of bank lending poses risks to China's banknig system. ...

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The biggest part of oil use in the USA is in transportation and this is where the savings have to come from. Americans were driving twice as many miles a day as they did in the last oil crisis in 1979. So a lot of the savings are to be expected in fewer miles driven as prices rise. The other saving will have to come from more efficient cars with better fuel efficiency and use of alternative fuels. Americans consumed 9.1 million barrels a day of gsoline in April 2008, two million barrels a day more than in April 1979. In 1979 of every 100 barrels of oil produced globally 29 wnet into American transportation, homes and power plants. This figure is only slightly down to 24 barrels so there is much room for significant reduction in a world economy where new technology can be accessed and the Japanese model for conservation shows further gains have already been made in other countries. So Chinese and Indian demand and demand in other newly developing countries will play a part but the US and Europe by showing the way in new technologies that can be adapted for use to reduce overall emissions and to get more out of each barrel of oil would find that these technologies are attractive to China and India in stretching a limited resource for increasing numbers of users in large demographics. Figures from Cambridge Energy Associates....

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What Handan Iron and Steel in Hebei Province 300 miles south of Beijing and ThyssenKrupp in Dortmund, Germany, have in common. The transplanting of Germany's aging defunct iron and steel furnaces and plant to Handan, boxed and crated away- its unreal that in 1998 Handan Iron and Steel bought and transferred an aging polluting plant to a city where the steel works are located in China which has 8.5 million residents. When years later the steel works were debated to be moved to a distance away from the city with Baoshan Steel, the decision was made to instead put a new plant there instead. The solution was to make pollution payments to residents of Handan. It was Mao's dream to build a steel industry in Hebei province ,which has large deposits of iron ore and coal and a rail line. Couple of questions come up to mind- one why did the first steel works go up right in Handan, and same is true of Dortmund, labor supply perhaps but couldn't homes be built nearby instead and these plants located away from cities. Second the deal for bringing the ThyssenKrupp plants was as recent as 1998, by this time China was already a big steel producer (producing more than the US by one estimate) and in a few years Chinese steel production was to exceed the US, Europe and Japan combined. With steel production already on the rise why didn't China move more carefully. Some of the Thyssen Krupp assets were built only a few years before 2000 and met stringent environmental control. China bought these.. Why didn't China pick out the best assets instead of old aging blast furnaces. The possible answers are that they were available at cut rate prices, but were they worth it. The second is that Hebei must be competing with other parts of China, and there wasn't a rational allocation of capital as would happen if a sophiticated company like a Mittal or a Tata Steel is involved. Is China operating on a outmoded concept- nationalism, competition between provinces with local government officials running the show? The other question is that in the case of the automobile industry a different pattern is seen, the most modern technology was selected , and in the case of Cherry, the most recent technology was selected for manufacturing cars, then why was this same pattern not adopted in the case of steel. In the end China has a surplus of steel mills, which makes this rush into steel production without carefully thinking through this appear to have been a mistake. The visual picture if one flies into Dortmund of manmade lakes, green park areas and residential housing and shopping from the $22 billion the EU and Germany are investing to turn the Ruhr valley region of Dortmund into a centre of education, technology and tourism now contrasts sharply with Handan in Hebei province. Can emerging countries do better, build manufacturing for jobs but keep living conditions in mind, be patient and work to achieve the best overall results, and build education, technology, appropriate for their own situation. ...

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Senators in the US Congress, Rubio and Schumer, have asked the US government to look into Apple's plans to work with Chinese semiconductor company YMTC. As a result the Commerce Department has placed export restrictions on YMTC. This NYT report looks at the two decade long rise of China and of Apple after Steve Jobs returned to Apple in 1997 and shifted manufacturing to China. When Jobs returned to Apple he found major quality issues at Apple's manufacturing facilities, a demoralized workforce, and financial losses, with CEO Michael Spindler running the company into the ground. Jobs had to start with afresh model for Apple and decided to shift manufacturing to China under the engineering leadership of Tim Cook. Alabama native Cook went to Auburn University for his engineering degree and Duke for his business degree. Cook joined Jobs in 1998 at Apple and for ten years till 2007 the two cut costs, shifted to contract manufacturers and rebuilt Apple with new products, iPod, iPad and the iphone. By not manufacturing Apple avoided quality control issues, and the costs of maintaining inventory. It was Tim Cook who ran operations worldwide, and he gradually built up the manufacturing relationships in China with Foxconn, which makes most of Apple's products in sprawling Chinese factories that employ 20 years later about 3 million Chinese workers. Foxconn was chosen by Apple in 2000 to manufacture the Apple Mac laptop. Before that it was a parts supplier to Apple. Increasingly Apple relied on Foxconn to make its new products including the iPhone. Both companies growth relied on the manufacturing of Foxconn to the point where Apple was dependent on Foxconn and had intertwined its operations with Foxconn in China. Today the whole relationship is being called into question after two decades in which American workers suffered the effects of the outshoring of manufacturing jobs. It should be noted that though Mr. Trump raised the issue of manufacturing exclusively in China with Apple, the Trump administration did little to change the practices of the company that pioneered this type of massive manufacturing role for China. That surrendered the entire supply chain to foreign suppliers in the interest of cutting costs and maintaining huge profit margins, with which it financed an array of new products and reached $1 trillion in sales from $10 billion, hundredfold increase over 2 decades. American workers and families for the first time in American history got very little from this Cook-Jobs project. American infrastructure in communities that would have been supported by American factories including the services and infrastructure in communities financed through local taxes, a practice throughout the Industrial Revolution in the US, was sharply disrupted over 2 decades. It caused a rupture in social relations and increased inequality in the US, and defunded infrastructure that comes with manufacturing.  It is the task of the Biden administration to now correct what Mr. Trump simply talked about but never induced or required Apple to do- lead the resurgence of American manufacturing, and make its major investments in the US, invest in its workers and families, invest in America. ...

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Professor Patterson of Harvard University has some serious observations on what has happened and what could be the way forward in America as it faces the lack of opportunities for a better life for minority communities trapped in cities with a deteriorating quality of life.  Between 1985 and 2000 a higher percentage of black children, about two thirds of black children, grew up in high poverty segregated areas than in the period between 1955 and 1970, according to a Pew Trust study of 2009. This affects everything from social mobility, life chances, potential for downward mobility. Particularly so because by 2016 the gap between black and white incomes has worsened, says professor Patterson. With this segregation has become worse in America at the level of neighborhoods where people actually meet, he says, citing a 2015 paper by Daniel Lichter of Cornell University.  In some ways segregation says Dr. Patterson is worse than in the 1960's. This could be because of downward social and economic mobility. Events such as the mortgage financial crisis of 2009 with bad decisions by the banking industry disproportionately hurt the black and minority communities. The trade imbalance and shift of manufacturing overseas hurt manufacturing jobs for white and black communities. Weakness in education and health services also hurt poorer communities of all races and color. In some ways the work of presidents Harry Truman and Lyndon Johnson in the 50's and 60's may have created more hope and a sense that "a rising tide lifts all boats" in economic opportunities that may have been lost in the work of presidents after Clinton with loss of jobs in manufacturing for ordinary black and white Americans alike. The bad decisions by the banking industry and selling of bad mortgages, worsening health care options with overpricing in the medical field, all compounding the effect on  ordinary Americans. In a separate interview in the Harvard Gazette professor Patterson says de-ghettoization, moving to the suburbs is one way to better opportuntiies in the suburbs. For this to happen more moderate income housing is needed in the suburbs. A cultural change in attitudes comes with a shift to neighborhoods where communities can interact and meet. For this to happen strict zoning laws that prevent moderate income housing in suburbs such as in California and many other states needs to change. As professor Orlando Patterson says here in the Harvard Gazette and in the WSJ more Americans with liberal views need to put their money where their voices are. A stronger economy, education for changes in cultural attitudes in classrooms, cultural literacy, more manufacturing in America to create better middle class wages and jobs for Americans of all communities giving industry a role, and more of the affluent putting their money where their voices are for better integrated living in the suburbs not just for a few, are ways to bring better life for Americans.   ...

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Property sales are estimated to fall by 28-33% in China, twice as earlier forecast by S&P Global Ratings. This is a steep decline that will affect the Chinese economy so dependent on construction. This week there were reports of property buyers in 100 cities getting together to withhold payments on unfinished apartments. Property developers depend on these payments as they have severe liquidity problems and need cash for operations.

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Brazil depends on private financing for agricultual production by farmers from companies like Cargill, ADM and Bunge. These companies finance about 40% of Brazilian farmers financial needs, though this year it may drop to 25% as credit tightens. They provide this money in advance cash payments and loans in exchange for future delivery of grain. This has led to a,rapid buildup of agricultural production and the infrastructure and roads needed, making Brazil the second biggest producer of soyabeans and accounting for 25% of world production. Now Bunge has cut advance cash payments by 70% since December 2007 according to company filings. ADM and Cargill have actually expanded the amount of credit available. But Soyabean and Corn Advisor, a consulting firm in Illinois estimates the cost of producing the 3 main crops in the state of Mato Grasso, the soyabeans, corn and cotton, will increase by 42% in 2008 over 2007. So farmers are faced with higher debt especially because this comes on top of accumulated debt from prior years when there were higher exchange rates in the early 2000's. Now Brazilian farmers are faced with falling crop prices, rising costs of farm supplies, unfavorable real-dollar exchange rates, and tighter credit, similiar to the situation playing out in the American farm belt. The plantings are smaller this year for soyabeans. And many farmers are forgoing debt payments and letting banks repossess farm machinery in Mato Grasso state. The overall impact of this will be lower global farm production and the impact will be felt in Brazilian GDP growth rates. ...

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Portugal leads the world in developing soccer players, no country has hundreds of soccer professional players all over the world. A country of just 10.3 million, the defending European champion, it has 292 professional players in 45 countries. Even Italy, another soccer crazy nation has only 105 pros abroad. Much of the development of soccer players from a very young age happens at sporting clubs Benefica, Porto, and Sporting. They act as scouts, finishing schools after rigorous practice, and places that transfer players to other clubs, all put together in one place with large soccer academies. The uniformity of coaching, and the primacy of soccer as a sport helps Portugal dominate soccer in a way that is not reflected in its size. Soccer fields in all directions is what you see at Benefica's training facilities in Portugal. 10 soccer pitches are not enough for the director of Benefica's youth academy. 10 different teams of exciting preteens to Portuguese pros need to practice every day.  Christiano Ronaldo was found at Sporting, Ricardo Carvalho at Porto. One boarding school at Benefica has 89 students who do their academic studies at the club and play soccer, attend classes in the morning and play in the afternoon. There are 3 different teams under 14. A pathway puts some of them into the senior squads or for them to become attractive enough to draw a large transfer fee outside Portugal. Five different talent centers and 200 people search for talent by watching under 10's or 12's play soccer games. Once they are chosen they move to Seixal, outside of Lisbon for training. The clubs essentially create value through selection and training for years in soccer academies within the clubs. The clubs support their activities by having a lower cost way to access talent at home, and by generating the hefty transfer fees. Since 2014-2015 season the surplus for Benefica is about 540 million euros. Costs are in the eight figures making it possible to generate a profit by having a sale of a few good players to lower profile teams such as Israel, even if they are not at the level of the top players in the Champions League.  ...

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Chrysler is beginnning the effort to cut dealership that aren't sellin enough cars. Note the figures for dealerships, GM 6900, Ford 4200, and Chrysler 3700, Toyota 1400 for market share, GM 23%, Ford 16%, Chrysler 14%, Toyota 16%, This comes to 300 delaers per market share point for GM 280 for Ford, 270 Chrysler, 90 for Toyota. Lower producing dealers and surplus dealers undercut prices of stronger dealers and everyone in general.

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Krugman on the failure of the Obama administration to take steps to help homeowners in the foreclosure crisis. The serious problems created in housing markets by a wave of foreclosures and declining prices. The failure of regulatory agencies to take necessary action that would reduce the wave of foreclosures. The impact this has in hampering an economic recovery.

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The figures are startling, alarming dangerous whatever you call it. How many homeowners are under water or owe more on their mortgage than their house is worth today in today's depressed market? And how many more will be under water in tomorrow's even more depressed market as unemployment gets worse in 2009, and much worse after that in 2010. Moody's Economy.com's chief econmist mark Zandl has worked out some figures. And he says one in 6 mortgages in America today are under water, that is 16% of 7.5 million households that own homes they live in, or roughly 12 million households. To give some idea of how quickly this is deteriorating while Congress, the Administration and the general public could not reach any agreement or consensus about assisting homeowners avoid foreclosure in steps that cover all homeowners across the USA. The comparable figures were roughly 4% under water in 2006 and 6% in 2007. Thats a huge jump from 6% to 16% and was not expected to be such a steep jump in 2008. And it may be accelerating for 2009. And of the homeowners who took on a mortgage in the last 5 years the figures are startling, 29% are under water according to estimate by real estate Web site Zillow.com, that is one in 3 almost. Which is why absence of government help on a comprehensive scale covering the whole country and all homeowners facing foreclosure remains the one huge gap in the rescue package passed by Congress for $700 billion at Sept end 2008. Why is it dangerous? Because it accelerates the downturn in the economy and exacerbates the problem of toxic mortgage assets on the books of overleveraged banks, as dropping housing prices from higher foreclosures depresses the value of those assets even further. And this creates a vicious circle of lower consumption spending followed by lower production, higher unemployment and leading to lower consumption spending in a repeat cycle leading to higher foreclosures as a consequence of higher unemployment....

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Slovenia is a small country of 2 million nestled in the mountains between Italy and Austria, part of the former Yugoslavia. Problems of bad debt at the major state owned banks, including Nova Banka Ljubljana, stem from a series of large management buyouts for home improvement chain Merkur, supermarket chain Mercator, the largest brewer and a major construction firm. Easy lending by state owned banks, corruption, cronyism and fraud have led to a large number of non-performing loans after a credit boom during 2000-2010. The bad debt at 6.8 billion euros is 19% of GDP in 2013. Protests in the capital Ljubljana in 2013 led to the fall of the centre right coalition government, the resignation of the opposition party leader and the appointment of a new opposition leader to run the government. Cuts to benefits and austerity measures have left the public in Slovenia seething about the economic mismanagement. This is another example of how the shift to a market economy after decades of state run economy in communist controlled countries of Eastern Europe and the Soviet Union has run into serious trouble because of opportunistic behaviour of politicians, bureaucrats and business....

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Edward DeMarco is head of the Federal Housing Finance Agency (FHFA), which is the independent regulatory agency overseeing U.S. housing lenders Fannie Mae and Freddie Mac. The FHFA was formed in 2008 after merging two existing agencies. Later that year Fannie and Freddie were taken over by the government. FHFA head, DeMarco, is reluctant to help homeowners with underwater mortgages on their homes with reduced payments because this would mean losses to the taxpayer. He sees his mandate as protecting the taxpayer. Sheila Bair, former head of the FDIC, says she understands DeMarco's mandate is not to provide fiscal stimulus, and the Obama administration has been all over the place when it comes to providing homeowner assistance. The result is that there is little help by the U.S. government to homeowners with underwater mortgages since 2008, and this creates larger headwinds for the Federal Reserve Bank to provide momentum to the U.S. economy. Many experts see this as a serious problem and a well respected economist, Martin Feldstein, has made repeated proposals for structuring the help to homeowners since 2008. ...

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This report in the WSJ gives the background and positions taken by Patriarch Krill of the Russian Orthodox Church, and his support for the war in Ukraine as part of Russian lands nationalism. Russian lands nationalism is an idea that comes from the beginnings of the Russian version of Christianity that had its origins in Kviv Ukraine in the 10th century. Patriarch Krill has had a varied role questioning some some state policies and then backing off and supporting the state says WSJ. In 2011 patriarch Krill stood up for protesters critical of manipulation in parliamentary elections that year. Patriarch Krill grew up in the years of Soviet rule and was 24 in 1970 when he began his work in the church. He was rector of a seminary in Leningrad by 1984 and after being critical of the Soviets and war in Afghanistan was sent to Smolensk says this report in WSJ. After he returned he worked with the Soviet state, and after voicing concerns in 2011 about parliamentary elections described as manipulated he has supported the Russian state as it becomes assertive about Russian lands nationalism. To understand the Orthodox Church in Russia one has to know its presence in the post Soviet period. About 63% of Russians belong to the Orthodox Church. It also includes Ukrainians. After Crimean invasion by Russia the Ukrainian Orthodox Church that makes up one third of the Russian Orthodox parishes was recognized as a separate church by Patriarch Bartholomev of Constantinople. Patriarch Bartholomev and Pope Francis the two leaders of the eastern and western churches in Constantinople and Rome have been critical of Patriarch Krill and his support for the war and the idea of Russian lands nationalism. Since the war some parishes in Russia have signed a letter opposing the killing of brothers in Christ and one parish leader was fined $500 for his statements. There is now intense debate among Russians about what this war means in bringing conflict on brotherly peoples about their preferences in 2022 for aligning with Europeans in the western part of Europe. For most of Europe in the 21st century there is a big change, in the countries near the Baltic sea in Northern Europe, in countries in the middle of Europe, in Eastern Europe, the 21st century is seen as a time when states and peoples are making their own choices about freedom and what their preferences are particularly the young people. They no longer understand or conform to ideas of the earlier period or centuries. And this is what has made Ukrainian young people oblivious about what Russian lands nationalism means and its relevance today. Buddhism is today not prevalent in South Korea a democratic state and in China a Communist state in the way it existed for centuries. For it to be relevant people need to begin to believe in it as in Japan or Sri Lanka or Thailand. In the 21st century young people are making different choices and this may well be where the Ukraine war shows that people's choices count particularly in the 21st century, and it has little to do with the west or the US or NATO or even Russia. ...

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The old online websites AOL and Yahoo are going through a transformation. Yahoo finalized an agreement to merge its web-search with Microsoft and much of their advertising busiesses. This leaves Yahoo with its popular finance, sports and news websites which are cheap to run as they are mostly aggregators of other websites' content with little that is Yahoo's own content. Yahoo's plan is to expand its audience , especially in develpoing countries where internet use is growing fast, and to package that audience in ways attractive to advertisers. In October 2009, according to comScore market research firm Yahoo had 158 millon visitors in America, and AOL had 98 millon. Yahoo! Mail has 106 million users monthly worldwide, AOL's email service has 336 million. The difference strategy pursued by Armstrong who is new CEO at AOL is to focus on creating new content. AOL is running about 80 websites covering everything from fashion (stylelist.com) and country music (theboot.com) to local news (patch.com). And has launched a website called seed.com to get people to contribute content. In this way it has about 3500 journalists on its payroll, some 500 of them work full-time. Armstrong thinks advertisers will pay a premium to appear next to this original niche site and home-made content. So far advertising has held up in this severe downturn, with online display advertising -the banners and boxes that show up on websites- at about $3.8 billion in the first half of 2009 in America, according to Interactive Advertising Bureau....

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Willingness to change opinions as the wind shifts, or as conditions change and new information or insights are gained, is a necessary quality in good leadership. You may not get it right the first time, and that is OK if you are honest with yourself and do the right thing, which is to take stock of the new information and understanding and act upon it, even if that is different from what you said or did before. These skills may be needed by the President in difficult places like Afghanistan and Pakistan, as well as at home in tackling the economy where some actions work and make sense and some others don not work or make sense under the conditions. Or its some new understanding of the conditions that is gained. FDR tried a number of things in his first 100 days in office and he got conflicting advice from some advisors, over time he obtained a better grasp of conditions and an understanding of what actions would be most effective in ending the crisis in the country. He had to be a good learner, be a good observer first hand of conditions, stay in touch with the people, honestly ask himself what would be the best thing to do in each situation. Sometimes he had to chart a new course and he had to know which advisers best represented the interests of the people and the country, and where to look for help. This is described by Adam Cohen of the NYT in his new book "Nothing to Fear". ...

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Italy's oil company Eni's new CEO Mr. Descalzi, is a 33 year veteran, who headed the oil exploration division under former CEO Paolo Scaroni. He faces the challenge of reducing its 5.1 billion euro debt at the end of June 2014, with the possible partial sale of its 43% stake in oil services company Saipem. Eni's stake has a market value of 3.5 billion euros. Other decisions he faces are to reduce geopolitical risk in Africa by selling stakes in its oil projects in Africa. Under Scaroni Eni sold a 20% stake in its Mozambique field to China National Petroleum Corporation for $4.2 billion. Delays at its Kazakhstan project ,chronic problems in Nigeria, the fighting between militias in Libya have hurt earnings and cash flow. Reducing risks in Africa is a priority because Eni aggressively pursued opportunities for exploration in places like the Congo and Mozambique, so that a larger part of its oil comes from unstable regions than other large oil companies. Profitability from these fields is not what it used to be because of oil theft in Nigeria and the fighting between militias and the government in Libya, with North Africa coming in at $18 per barrel and sub-Saharan Africa at below $15 per barrel, compared to $30 per barrel from Kazakhstan for the last 3 years, according to Kepler Cheuvreux. Another problem the new CEO faces is the 800 million euro loss at the refining operations in the last 2 years. The government has a 30% stake in Eni, making refinery closings a sensitive issue. Refinery product demand is down with the economic crisis in Italy....

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The 1985 hit "Small Town" by John Mellencamp is about Seymour, Indiana. Republican State Representative Jim Lucas says the city of Seymour welcomes immigrants legally here who are properly vetted. The concern is about migrants not vetted and not legally here. At a recent city council meeting Lucas attended it was decided not to go ahead with an economic development agenda. Says Lucas- “However, Seymour has changed drastically in just the past few years, and many of us are obviously concerned about the direction we are headed,” he added. New immigrant cases or migrant arrivals for Jackson county, Indiana, where Seymour is located went up to 435 in 2024 from 66 in 2021. It is at that point that the welcome center idea ran into opposition in this small town in Indiana, an hour from Indianapolis population 21,000 in Jackson County. As the town's population mix changes - it was 1% Hispanic in 1990, then 5% Hispanic in 2000- jumping in two decades of Bush-Obama-Trump-Biden to 25% Hispanic, questions besides economic about the sense of uneasiness of resident came up. Also of cultural literacy of the state of Indiana, and of the history of the state within the Union forged by Washington and Lincoln, FDR and Eisenhower, and of Wendell Wilkie of Elwood, Indiana. Unemployment rate for Jackson County is 3.3%, median income $63,000, home ownership 57%. Issues were not about the economy alone, and about how many immigrants could be absorbed and the cultural and language literacy of arriving migrants. There were issues about the perceived crime rate (metrics show traffic related offenses were up), and about drawing too much of the school's resources as English learning went up slowing learning in the schools. Republican State Representative Jim Lucas says it is crowding the health care clinic downtown with immigrants. ...

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Fitch Ratings Agency says that 65-75% of homeowners getting home loan modifications under the Obama administration's Home Affordable Loan Modification Program (HAMP) will default in 12 months. This is because the median ratio of total debt payments to pretax income is about 64% according to a Treasury Department estimate. Many of these homeowners have large credit card and other debt, and little is left for food, clothing and other expenses. By April 2010, 295,000 homeowners had taken loan modifications under HAMP, which provides interest rates of as low as 2%. And another 637,000 homeowners are in trial modifications, which require that homeowners show they can make the lower payments consistently and provide documets to show eligibility. The Obama administration has provided $50 billion for the HAMP program, with financial incentives to loan servicers and mortgage investors to modify loans. Critics say the program would have worked better if the government and HAMP dealt directly with homeowners- as homeowners complain about the long time, upto a year, it takes for loan servicers and mortgage companies to get the loan modified on a long-term basis....