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Timothy Egan points to the huge gap between a T.R. in 1910 making the speech in Osawatomie, eastern Kansas, and Professor Obama making an election speech in 2011. T.R.'s was an election manifesto that brought up the issues of conservation, child labor, a plea for an income tax, call for worker protections, limits on corporate power and influence on the laws and direction of the country. The speech was made in 1910, after Taft had assumed the presidency with Roosevelt's backing, and would lead to T.R. running against Taft and Woodrow Wilson. Most of what T.R. advocated became part of the country's social and economic fabric, much of the work beginning with Theodore Roosevelt's two terms as president, and also pursued by Woodrow Wilson, the president elected in 1912. By contrast, in line with the timidity of today's politics, Obama's speech called for approving his nominee for consumer protection bureau chief, and continuance of tax cuts for the middle class. Egan calls it a curse of today's politics and national debate that no politician can set the course for revitalizing America the way T.R. did. Some of what T.R. said in Kansas that day is: "There can be no effective control of corporations while their political activity remains. To put an end to it will be neither a short nor an easy task, but it can be done." "The right to regulate the use of wealth in the public interest is universally admitted." Jackie Calmes covered the extensive ties of both candidates, Obama and McCain, to Fannie Mae and Freddie Mac, in her report for the New York Times, on September 9, 2008- "For 08' Rivals a Skein of Ties to Loan Giants." Paul Gigot, editorial page editor of the Wall Street Journal, who with his reporters did some of the difficult reporting on Fannie and Freddie, wrote in one of his columns with a note of pessimism, that he wasn't sure that either of the presidential candidates were interested in what was happening. ...

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Rich calls Obama's speech for all its apparent thoughfulness and logic, a failure in its mission of coming up with a way to tackle Afghanistan and Pakistan. It did not grapple with the real issue and complexity of these places. He says the rigorous analysis failed and what Obama is ending up with is a too clever by half holding action which lacks credibility becuase the Karzai regime lacks credibility, and the American people have serious doubts of the wisdom of increased involvement. Worse it lacks acredible exit strategy for all the emphasis on early withdrawal. Making some calculations with Petraeus's field manual Rich comes up with a force of 586,000 that would be needed for a proper counterinsurgency in Afghnistan for its population of 28.4 million. But America still would have only less than one fourth of this number in the vast mountainous terrain of Afghnistan, especially when the government it is backing has seriously alienated its own people. So isn't it just as possible that McChrystal and Gates have made a serious error, that the surge that worked in Iraq was based on apeculiar topography that is absent here, which means even more troops not awithdrawal is likely a year from now? He points out that, as Fred Kaplan had pointed out in Slate, that the idea that the coaltiion partners are increasing their share of the burden is an illusion, as America's new share of allied troops with the surge will be 70% compared to 50% when the Bush administration left office. But what he finds most disingenuous is the idea that there will be no sacrifices in economic terms for America, that life can just go on like before, even as the cost of the war will shortchange urgent economic priorities at home and even gut alot of the domestic needs. This was missing in the Obama presentation....

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Two things happened last week. The yields on mortgage debt rose sharply, with debt from Fannie Mae yielding 1.8 percentage points more than Treasury bonds of same maturity, which compares with a 0.7 percentage point spread over Treasury bonds in September. Investors including foreign central banks are shunning Fannie and Freddie debt because of uncertainty about the government backing and other forms of debt such as bank borrowing backed by the FDIC has explicit government guarantees. As Fannies and Freddie borrowing costs rise so do mortgage rates. Beginning next week December 1, 2008, the Fed will start buying $100 billion of debt issued by Fannie and Freddie and it also plans to buy upto $500 billion of mortgage backed securities guaranteed by Fannie and Freddie, and the Fed will hire private asset managers to manage this portfolio of investments. By doing this the Fed hopes to lower yields on the debt and bring down mortgage rates to help people buy housing. Teh second thing that happened is that according to Treasury Secretary Paulson the market for securities backed by consumer debt came to a halt last month making it impossible for consumers to get financing for everything from college to computers. This would lead to disastrous results for the many industries and companies that rely on consumer finance to sell their products. this in turn would lead to rising inventories and layoffs, something the auto industry saw happen as financing dried up and sales for GM collapsed dropping over 40% in October, over October 2007. The solution with the support of Treasury the Fed will provide upto $200 billion of financing to investors buying securities tied to student loans, car loans, credit card debt, and small business loans. This should help lower interest rates on these consumer loans and help maintain consumer lending. The Treasury will assume the first $20 billion in losses from this program. ...

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The huge changes for upward mobility and women taking place in India can be seen in the way 19 year old Mumtaz, daughter of vegetable cart vendor Qasier Jahan, found a place in India's World Cup Women's Junior Hockey team. She is the third biggest scorer in the Junior World Cup and made the courageous goal for India to set the tone for a 3-0 win over South Korea in quarter finals. Mumtaz is from Lucknow, Uttar Pradesh, which is going through huge changes as development accelerates and new infrastructure is built. 

Athletic coaches saw her ability in sprints at a school competition in Agra which led to their encouraging and supporting her to play hockey. Lacking resources to buy even a hockey kit coaches stepped up and helped the young girl play, learn new skills, and compete in national hockey.

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China's push for globalization is being perceived internationally as an effort to promote its own industries.

Clashes with the U.S. on trade have changed the perception of China in global trade compared to what it was four years ago or in 2008. Tariffs in the U.S. on Chinese imports, slowing foreign investment, inflated property prices, bad debt at banks, and shrinking working age population, are leading to slowing growth which in coming years could drop from 6.1% in 2019. The Belt and Road Initiative is also being perceived differently as it has led to increased in indebtedness of countries in Africa and Asia, debt that cannot be paid back. Much of the ebullient optimism of a few years back is no longer present. The Pew Research Center survey of 34 countries in December 2019 shows about 45% of adults surveyed lacking confidence in China's policy positions in world affairs, according to this report in the WSJ.

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The check to the U.S. government and four other countries of $3 billion by Goldman Sachs is the largest fine ever paid. It ends a yearlong investigation first reported in the WSJ on 1MDB Malaysian fund. It will cost Goldman $5 billion in financial penalties for its dealings with the Malaysian fund 1MDB. The fund was intended for the development of Malaysia and improving the economy for the benefit of the people but ending up being used for other purposes. Prosecutors said it had become a source of funds for government officials, investment bankers. In New York federal court a Goldman subsidiary pleaded guilty to conspiring to violate bribery laws.

An expert on corporate enforcement at Duke University says the agreement with the government is lacking in that the potential fine could have been as high as $5 billion, and lacks monitoring to ensure compliance in the future.

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Turkey is reviving its relations with Saudi Arabia and the UAE. Prince Bin Salman will visit Turkey as part of a remake of Turkey Saudi relations. Turkey's economic crisis has revived the relationship as Turkey badly needs aid for its economy. The pressure on emerging markets is increasing with US central bank raising rates reducing inflows of western money into Turkey even further. Prince Salman has already received visits from French and British leaders. He visited Jordan and Egypt this week and will now be in Ankara. In the summer he will visit Greece and Cyprus. Saudis are modernizing their economy changing culture in relationships of men and women, in women's rights and education, and broadening relationships with the world under Salman. There is an astonishing openness to science and technology in a drive to be modern. The old Saudi monarchy and conservative rule with ancient traditions is giving way to what the Saudis in the group under Salman see as the modernization of Europe and America in the 20th century using science and technology as what they would like to see in their own country. There is also a drive to think independently from the dogmatic positions of the past that have turned the Kingdom into an American dependency with no obligation or incentive to modernize its culture and be open to the world outside.  The US fought a war to ostensibly modernize a backward mountainous remote state as Afghanistan, while being perfectly comfortable with the old Saudi monarchies of the past that made little change in the ancient culture and tradition and in women's rights and education. Such were the contradictions in American policy and the failure to think anew. As president Lincoln said "as our case is new we must think anew, and act anew." President Biden will now visit Saudi Arabia to build a new relationship with an independent nation, which along with the UAE is bringing change to the Middle East through infrastructure development and modernization. Salman's modernization comes as the kingdom also faced a need to make a transition out of dependence on fossil fuels. Salman sees trips to Greece and Turkey as opening up to all sides. Saudis have good relations with Israel and Egypt another part of this openness. The US senses this, India has sensed this. India's Modi government  made sending the Oxford vaccines manufactured in India to Saudis a priority during 2021. The Indian example is also changing the way the UAE and Saudis see infrastructure development and modernization in the region. This is also changing the way the region is looking at itself. For decades Egypt lacking the resources to build infrastructure on its own has languished economically. A helping hand from the Saudis is changing Egypt. The entire rail system is being modernized with the latest technology from Siemens. The Saudis have stabilized the Egyptian economy with a $5 billion deposit in the Central Bank of Egypt. On June 21 Egypt and Saudis signed $7.7 billion in investment deals for infrastructure, logistics, port administration, food, industry, medicine, energy and technology. In the investments in Egypt some of the oil money going to Saudis with $100 per barrel oil price is going to an economy in Egypt that can easily absorb and make good use of the investment to modernize.   The influence of Saudi leverage in fossil fuels which drove the US relationship with Saudis since FDR is being replaced with an independent Saudi kingdom making decisions to modernize across the board in all aspects compared to one that favored a few American companies such as Exxon Mobil and ARAMCO or arms makers such as Boeing and Lockheed that helped recycle American money going to pay for Saudi fossil fuels back to America.    ...

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The relationship between the southerner finance minister Schauble, and chancellor Merkel from the former East Germany is close, with each depending on the other. The Greece crisis following the referendum, with Schauble's patience with Greece exhausted by July 9, 2015, is reflected in the words he used in February 2015 about the Greece bailout program "ich over", his southwest German accent version of "it's over." In the German parliament Schauble has described the Tsipras government's behaviour as "lacking any rhyme or reason," and Schauble's popularity rating in the ruling CDU party is higher than Merkel in 2015, at over 70%. Schauble is a key CDU member in bringing the CDU's conservative members behind Merkel. This also limits the room Merkel now has in negotiating some last minute deal on Greece before the expiry of the deadline of July 12, 2015. Merkel has also set a higher bar for the negotiation, and a multiyear deal making reforms a high priority. When Schauble says there is no "rhyme or reason" for Syriza party Tsipras's behaviour he may be referring to the EU giving in to Greece's key demand for a change in the surplus targets for 2014-2016. As economists including Krugman point out the surplus is what Greece transfers to its creditors, and additionally with the EU making transfers of about 5% of GNP to Greece according to Harvard economist Kenneth Rogoff, aside from cuts to pensions as part of pension reforms to return a unsustainable pension system to sustainability, the Greeks had most of what they could expect at this time. The debt is basically being rolled over with EU loans helping pay what is now very low interest, making it an issue that could be tackled at a later stage, say economists, even though Syriza made it an overriding issue in the referendum. Both Schauble, Merkel, and the rest of the CDU, and many Social Democrats including their leader Sigmar Gabriel, find Syriza Tsipras's moves incomprehensible and damaging relations. German experts now see the Eurozone and the Euro currency better off for the future with a Grexit, which also limits what Merkel and Germany can now do....

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Bernanke's defense of the action of the Fed's monetary policy making committee, on November 3, 2010, (with a vote of 10-1) to buy an additional $600 billion of Treasury securities over the next 8 months. His defense focusses on the prospects of deflation- how low inflation can morph into deflation (falling prices and wages), that can create a long period of economic stagnation. In addition, with low and falling inflation, Bernanke sees spare capacity in the US that can be utilized to reduce the number of jobless people. He points to the rise in stock prices and fall in long term interest rates in anticipation of the Fed's action, as evidence that this Fed move would improve financial conditions. Lower mortgage rates would make housing more affordable, higher stock prices would increase consumer wealth, confidence and spending. Spending would lead to higher incomes and profits for economic expansion, from this viewpoint. The situation in November 2010, was a deepening housing slump anticipated for 2011, gridlock after the 2010 midterm elections and no agreement on additional stimulus for 2011, the need to rebalance the global economy lacking cooperation from China (with China increasing imports and reducing exports and the US increasing exports and reducing imports). Fed's Bernanke does not mention these factors, and only hints at the gridlock towards the end of the statement. This Fed action will push the dollar lower, just as efforts to improve exports and the trade balance are underway. The Fed's committee sees the risks of commodities inflation as an acceptable risk in the current situation, and the use of a cautious approach assessing the purchase program regularly as sufficient measure of safety. As to difficulties of the unwinding of these policies, the Fed sees present danger outweighing the risks of no action. For emerging markets such as Turkey, India, Australia and other countries seeing even more inflows of capital, the risks are left to these countries to manage. The central banks of India and Australia moved to increase interest rates at the same time that the Fed made its move....

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"China's Superbank," by Henry Sanderson and Michael Forsythe looks at the rise of China Development Bank to provide insights into the two decade real estate boom in China, and the trillions of dollars in loans made by state owned banks to finance China's state owned industries and infrastructure development. The authors say these loans based on land owned by the state, improved with roads and other infrastructure and then sold to industry, have helped finance China's urbanization and industrial development. But it has also created problems including eviction of farmers from the land by local government authorites increasing inequality, led to misallocation of capital on bad projects, and an unsustainable model of development focussed on state owned companies. A major side effect of this is not covered in the book. This is the impact of crowding out of credit for private industry in China, with privately owned business having to pay higher rates in the underground loan market or lacking financing. A major focus of the report "China: 2030" by the World Bank and China's official think tank Development Research Center is on reversing this development to come up with a sustainable development model. The report was supported by World Bank chief Zoellick and China's new prime minister Li Keqiang. "The Great Rebalancing," by Pettis, a finance professor at Beijing University, looks at the other side of the financing of China's boom- the low interest rates on savings for China's consumer. This reduces household incomes and reduces purchasing power as the interest rates are lower than the rate of inflation. Lower value of China's currency also reduces the purchasing power for China's consumers. Estimates show the low interest rates cost China's workers and consumers somewhere in the range of 3 to 8% of GDP annually in bank deposit income. This money is funnelled through the banking system to make more loans for infrastructure and growth at the state owned companies, concentrating exraordinary level of financing in one direction. As a result the consumption share of GDP in China has actually fallen in the two decades of hyper development. This is about 34% compared to 50-55% for other Asian economies....

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How the IMF conditionality has changed in the 2009 global economic crisis. The IMF head, Dominique Strauss-Kahn of France, is aware how sensitive nations around the world have become to the word IMF. So much so that it has even suggested removing the word IMF from loans to get takers. The IMF conditons worsened the S. Korean financial crisis in 1998. See link to this. This time Kahn has advocated that the developed countries of Europe and the USA increase stimulus spending to 2% of GDP.And there are fewer calls for cutting spending in developing countries offered help by the IMF. Pakistan was asked to increase interest rates by 3% but actually increased them by 2% to fight inflation. But to get some idea how the IMF is viewed with suspicion and hostility in many countries one has to listen to comments made. The move for Pakistan was so unpopular in 2008 that Mohsin Khan a top IMF official says he met with agroup of generals to get their backing. Some IMF officials insistend on a 10% rate increase. Something like that would have led to riots in Pakistani cities. IMF loaned Pakistan $7.6 billion. When S. Korea said no to the IMF credit line, Lee Hyoung-ryoul, a Korean Finance Ministry official said that S. Koreans tremble and financial markets turn sensitive whenever they hear the word "IMF." This time Brazil, S. Korea and Mexico, were offered condition free credit lines. But it has found no takers from these three conuntries, so badly is the IMF viewed in developing countries. Even though it appears that Kahn, in the small club of western nation's officials and staff that form the governing body of the IMF, is trying to give the IMF a new image, its just so bad and the views of the old timers at the IMF on spending or interest rates so contrary to the needs of people in the developed and developing countries, that a new generation of people in finance and economics will be needed before real change is established. ...

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India decides not to join the China sponsored Regional Comprehensive Economic Partnership. India says it has significant issues in providing market access that would hurt Indian industry and agriculture. Prime minister Modi called it a question of conscience. All parties in India now oppose RCEP because of a fear of India being flooded with cheap Chinese imports. Japan and China, South Korea, all protected their local industry to give it catch up time to come up to western technological and production levels before allowing limited access to U.S. and Europe. The U.S. has reverted to protecting its industry from cheap Chinese imports by rejecting the Trans Pacific Agreement, showing that advanced industrial countries can also be hurt by cheap subsidized imports if they are not careful. Workers in less densely populated areas were worst affected statistics show. Lacking the voice of larger urban areas and tech industry they were ignored leading to the situation the U.S. and Britain face today of a working class set adrift. ...

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Trump has an interview with Larry King, a veteran TV personality, who made the interview for the Russian government controlled RT network. In it Trump says the war in the Middle East has cost the U.S. trillions of dollars and that we should never have gone in there. The interview was phoned in and done as a favor to Larry King, lasting 10 minutes and ending abruptly.  Trump also denied the Russians are involved in the hacking of the Democratic Party computer networks. The issues over Trump's opposition to the war in Iraq also comes up in an NBC interview. Media sources say this is not true, that initially Trump supported the U.S. going into the war, and Matt Lauer of NBC has come under criticism for not pursuing this question with Trump. It has become common for political leaders to blame the Bush administration for action since 9/11 including the war in Afghanistan, and the war over WMD in Iraq, because of the unpopularity of the wars today. Yet at the time this was not the case, and only when WMD was not proven and the war in Iraq's Anbar province dragging on did the situation change. Separately Trump in other events praised Putin as a stronger leader than president Obama. This has come under criticism from Republican party leaders. ...

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In this insightful essay Peggy Noonan, former spokesperson for president Reagan, says that Republicans like Speaker Ryan with the Republican Health Care bill are making the same error made by president Obama.. Noonan says she had suggested a different way for president Obama to show compassion for the uninsured- first wait till the 2008 financial crisis was tackled, tackled waste and fraud in Medicare first, then look at the option of expanding Medicare to help the uninsured, and not the approach taken of swiftly focussing on the Affordable Care Act early in the first term disregarding Republican objections. She says Republicans are making the same mistake now by ignoring the impact the bill would have on Trump's base of working class Americans who may be affected by the bill's provisions not taking into account incomes in offering incentives or subsidies. Noonan says Trump did get one thing right in calling it a "carnage" for the worsening opioid epidemic in America which has hit rural areas and parts of the midwest hard. Noonan says Eberstadt has correctly documented the collapse in working class Americans wages and standard of living, and Caldwell the opioid epidemic at another level to their health. She also supports journalist Carlson who questioned Speaker Paul Ryan's judgement about eliminating the tax on wealthy investors in new legislation in a Fox News interview, as she says responding to the sense of America at the moment means listening to the sense of being left out of ordinary Americans, who have done not as well as the wealthy who have benefitted from a surging stock market.  ...

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Thomas Hoenig, chairman of the Kansas City Federal Reserve Bank, says the five largest financial institutions in the US are 20% larger today than they were before the 2008 crisis. These five institutions control $8.6 trillion in financial assets or the equivalent of 60% of gross domestic product in the USA. He points out that whether we like it or not, these firms are too big to fail. Though these institutions survived the 2008 crisis with a bailout from the Fed as shown in the Fed's recent revealed documents, Hoenig says, little has changed on Wall Street. Two years after the crisis of 2008, these firms again operate with bonus and compensation schemes that reflect not the recent failures but a sense of success. Hoenig says this is why the American people are angry. An absence of accountability and blatant inequities with which smaller businesses and institutions were treated compared to the large ones, is why they will remain angry. Without this accountability he feels Americans cannot build a national consensus for the sacrifices needed to rebuild the American economy....

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In response to bellicose speeches by Republican presidential candidates Mitt Romney and Rick Santorum at the American Israel Public Affairs Committee conference on March 6, 2012, President Obama stated at a press conference: "This is not a game..The one thing we have not done is we have not launched a war.. If some of these folks think we should launch a war, let them say so, and explain to the American people." The U.S. president, advisors and intelligence officials believe that Iran has yet to acquire a nuclear weapon, that there is time for sanctions to work and make the Iranian government give up any weapons programs it is working on. Their view as stated by the U.S. President is that this time cannot be measured in two days or two months. Recent elections in Iran show divisions in the government between the Ayatollah Khamanei and premier Ahmadinejad, with the elections favoring candidates supporting Khamanei. There is also the dynamic of changing relations in the Middle East- between Iran and other countries such as Iraq, Turkey, Saudi Arabia, India- which have strong ties to the U.S., and Iran's relations with China and other countries which have close economic ties to the U.S. In addition in a country with a demographic skewed heavily towards younger people and a third of the people under 15, the democracy protests in 2011 about a flawed election in 2009 are supported largely by university and college students. That election may actually have been stolen by Ahmadinejad from Mr. Moussavi, who in an election eve television debate accused Ahmadinejad of "adventurism, illusionism, exhibitionism, extremism, and superficiality," (Nazila Fathi, NYT 6/4/2009). These factors are likely to be behind the Obama administration's sense of a "window of opportunity," to use Mr. Obama's words. Recent polls by the University of Maryland's Prof. Telhami show only 19% of Israelis favored a military strike without U.S. backing in Feb. 2012, and Israeli public opinion experts see Obama's position as reflecting a sound judgement. Research by Citigroup shows that at a price for Brent crude of $120 with an escalation in Iran, it would take 9% of the world's GDP to support the higher energy costs, hitting Europe especially hard (Liam Denning, WSJ 1/6/2012)....

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Judge Rakoff is interviewed by Adam Liptak as an essay by Rakoff appears in the December 22 issue of The New York Review of Books. Judge Rakoff is critical of the Justice Department for not prosecuting individuals responsible in the 2008-2009 financial crisis and merely offering excuses. He discounts the Justice Department argument that proving intent is difficult or that proving fraud is hard because of the sophisticated counterparties on both sides. He says assistant attorney general in the criminal division Bauer's assertion that you have to prove the individual involved made a false statement, intended to commit a crime, and that the other side depended on this for what they were doing, is misleading. The government is not required to prove that one party to a transaction relied on another party. On the difficulty to prove wilful criminal intent for individuals several layers above those who made and marketed the bad securities, Rakoff says the legal doctrine of wilfull blindness could have been used. Reflecting on why the Justice Department has not prosecuted individuals for wrongdoing the way Milken, Keating and Skilling were prosecuted in prior financial crises, Rakoff comes up with a explanation. He says the government's own role and the role of firms throughout the financial system is suspect in the 2008-2009 financial crisis unlike prior crises. Not only regulators are failing to to do their job. The financial system offers incentives for the packaging of bad debt securities. Fannie Mae has government backing and its management buys these securities to expand access to housing for low income people. The profits made on these securities brings U.S. and foreign banks into this business and leads to a proliferation of these securities around the globe to the point that small towns near the North Pole end up with these securities in their portfolio. This complicates things for prosecutors who in some situations have themselves worked for banks selling these securities. In its slow deliberative way the Obama administration, the Justice Department, and the S.E.C.'s new head, move to prosecute firms during the administration's second term, but not enough is done and tackling individual responsibility for deterring future wrongdoing in the interests of a safe and fair financial system seems a long way off....

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The large increase in auto sales in 2013 to 15.6 million follows a strong rebound in the U.S. market. The gains in sales over 2009 at the peak of the financial crisis, shows Chrysler at 93% gain in sales over 2009, VW at 92%, Nissan 62% and Ford 54%, according to Autodata. Smaller gains of 33% and 26% for Honda and Toyota. Chrysler's sales were 1.8 million in 2013- the company which depended on policymakers in the Obama administration for survival showed remarkable gains under Fiat's CEO Marchionne. VW returning to the market and stumbling repeatedly in the previous ten years, made serious gains with Jetta and Passat models designed and priced for the U.S. market. VW achieved sales of 0.6 million in 2013. Ford sales were 2.5 million, Nissan 1.2 million, Honda 1.5 million and Toyota 2.2 million for 2013. GM sales 2.8 million increasing by 35% in 2013 over 2009. The automobile story may be the biggest story in the U.S. manufacturing recovery. It also may have made a difference in the election campaign of 2012- with winning campaign points in key midwestern states such as Michigan and Ohio for the Obama administration's backing of a renewed auto industry around fuel efficiency improvements, new management, and new relationship with unions. In the period 1998-2007 average sales were 16 million in the U.S. market, with a nosedive to 10.4 million vehicles in 2009, and a rebound to 15.6 million in 2013, according to Autodata. Under previous union contracts with higher wages and pension costs, and a flurry of price incentives, car makers needed higher volume to make profits. Changes since the bankruptcy of 2 automakers include bringing in management from outside the auto industry- Marchionne at Chrysler, Whittaker and Akerson at GM came from other fields (telecom, finance) bringing new perspectives. Mulally at Ford was from Boeing commercial aerospace. Other changes were lower wages and pension costs with renegotiated contracts and relationships with unions, discipline to lower incentives, younger managers moved up and brought in from outside including Reuss and Barra at GM, Farley at Ford, lower sales to fleets, improved fuel efficiency for SUV's and pickups to change the cost of operating, a mix shifted to smaller and midsized cars, improved quality, and changing the buyer perception of American brands....