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Vehicle sales in the U.S. market went up by 18% in April 2011. There was a significant shift fuel efficient vehicles and small cars with gasoline running at over $4 per gallon. Sales are running at an annual rate of over 13 million vehicles for the February-April 2011 period. Helping sustain sales momentum is the aging of the U.S. vehicle fleet- average for vehicles in the U.S. is above 10 years according to G.M. vice president, Don Johnson. GM sales were up 27% in April 2011 over the prior year- with only a 2% increase for pickup trucks and a 50% increase in sales for passenger cars. There was strong demand for the Chevy Cruze compact and smaller fuel efficient sport utility vehicles. Ford had a 16% increase in sales, with strong demand for the new Fiesta, Focus small cars and the new lighter version of the Explorer SUV. Ford's Ken Czubay, head of sales and marketing, says dealers are selling the Focus right off the convoy truck, which gives some indication of the shift in consumer preferences. Chrysler vehicle sales increased 23%, with car sales up 41% in April over the prior year. Some indication of the shift can be seen in the incentives dollars- the largest rebates of $3200 were given for large trucks, according to Edmunds.com. At the same time overall dollars per vehicle for incentives dropped from $2600 in April 2010 to $2100 in April 2011. Toyota sales increased by only 1% because of shortages as a result of the earthquake, especially for the smaller cars like the Corollas and the Prius....

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Stephen Harper's Conservative party won 167 of the 308 seats in Canada's House of Commons, the NDP won 102 seats, the Liberals 34 seats and the Bloc Quebecois 2 seats. Harper gave indications of how he would govern by saying that he would stay on the same path the Conservatives followed when they were a minority party. He said there would be no changes to Canada's public health care system. He told a news conference in Calgary, Alberta: "Even as a majority you have to, on an ongoing basis, keep the trust of the population." The Conservatives won only 40% of the popular vote, and this may be a reason for the caution in making major changes. The Conservatives maintained their base in western Canada, and gained seats in Ontario. The gains in and around Toronto, came because the left-of-center vote was split between the Liberals and the NDP. Experts say Harper will shut down a disputed registry for rifles, end direct government subsidies of political parties, and maintain scheduled corporate tax cuts. The Conservative government is also expected not take any significant steps to cut greenhouse gas emissions that are opposed by the oil and gas industries in western Canada. ...

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The fact that Osama bin Laden was in Abbotabad, near the Pakistan military academy and military facilities, and was probably sheltered by the ISI, raises the issue of Pakistan sheltering the terrorists who planned the Mumbai attacks. This increases pressure on the Indian government to take up this issue and affects efforts to improve relations.

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Turkey's prime minister Recept Erdogan, says Libya's Quaddafi must step down immediately. Earlier in this conflict Turkey had tried to negotiate a settlement between Quaddafi and the Libyan opposition government. Turkey is also closing its embassy in Tripoli.

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Jens Weidmann becomes the new president of the German central bank, taking over from Axel Weber. Weber was critical of the ECB's bond buying program for Greece and other countries facing a deficit crisis, to which he alluded when he said at the handover ceremony- "at times we struggled with one another in light of difficult and far reaching decisions- not over the common goal, but how to reach it." Weidmann was an advisor to Chancellor Merkel. He is a student of Weber and the youngest President of the Bundesbank. He brings a measure of flexibility and trust for Merkel, as he was part of her inner circle of advisors.

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The Fed's quarterly Senior Loan Officer Opinion Survey, says U.S. banks have relaxed lending standards and more businesses looked for loans in the first quarter. Yet the demand for loans is sluggish. While auto loans increased, credit cards and other instalment loans were flat, and mortgage demand is decreasing. The sluggish demand for loans is holding back the growth in the profits of banks. This is also why the KBW Bank Index fell by 7.9% this year and bank stocks are not doing well. Lower revenue reduces the Net Interest Margin, a key measure for bank profitability- the difference between what is earned on assets and the cost of deposits and other laibilities. NIM went up to 3.77% in 2010 with the Fed's low interest policy. Since the first quarter of 2010 NIM is falling. NIM at 2.67% is flat at Bank of America, fell for Citigroup and Well Fargo, and only rose slightly at J.P. Morgan Chase.

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Air Canada is planning a campaign to persuade business travellers to try Air Canada hubs in Montreal, Toronto and Vancouver, for flights to Europe, Asia and other long distance destinations. This strategy is aimed at secondary markets in the U.S. that lack direct service to Asian countries. Toronto's Pearson airport has just completed a C$4.4 billion modernization. In Vancouver and Montreal passengers connecting to the U.S. will no longer have to claim their baggage and will go directly to U.S. customs. The same arrangement is being planned for Toronto this fall. Air Canada is counting on its fleet of younger planes and wide body aircraft and a pleasant experience through Canadian airports. Recent capacity additions for Aisa will also help. Air Canada's trans-Pacific traffic increased by 22% in 2010 from 2009. Air Canada made a profit in 2010, after suffering a serious loss of 1 billion Canadian dollars in 2008. Air Canada's CEO Calin Rovinescu's strategy is part of his effort to make Air Canada "an international powerhouse," making Toronto and other Canadian hubs some of the world's major gateways....

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New auto sales in Japan experienced a sharp decline of 51% in April 2011, higher than the 37% fall in March. Sales of Toyota fell 69% to 35,557 vehicles in April, Nissan's dropped 37%, and Honda's dropped 49%. About 500 suppliers in northeasern Japan are affected by the earthquake. Toyota president Akio Toyoda says the production will return to normal by November or December.

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As U.S. carmakers vehicle sales recover and the Japanese carmakers go through a slowdown as a result of disruptions from the earthquake, the U.S. and the Japanese carmakers find their situations reversed. Japanese carmakers are facing vehicle shortages in the U.S.. Detroit carmakers see the opportunity to make gains in market share during this period, till Toyota and Honda return to normal. Detroit carmakers have also been affected by the earthquake related supplier disruptions, but to a much smaller extent. Chrysler expects to produce 50,000 to 100,000 fewer vehicles as a result of disruptions, according to Marchionne. Chrysler, the weakest of the Detroit carmakers, has staged a recovery under Fiat's Marchionne. One hurdle was the high interest payments- $348 million in the first quarter of 2011- on the $7.5 billion borrowed from U.S. and Canadian governments. Chrysler increased revenue by 35% to $13.1 billion, with global sales of vehicles up 18% to 394,000, and profits of $116 million in the first quarter 2011. The market situation is still precarious for several reasons. Sales of pickup trucks and larger vehicles- which still constitute a major portion of vehicles sales of Detroit carmakers- are vulnerable to higher gas prices. The Japanese carmakers have large cash reserves for new investments, and will introduce new models as they recover from the earthquake. In the past Detroit carmakers used incentives to maintain sales, which diluted profits. Jeremy Anwyl, chief executive of Edmunds.com, says Detroit carmakers have an opportunity to get back to a situation where they can compete with foreign carmakers on a level playing field, with better market acceptance and higher prices. GM says it will increase prices by about $123 on average to cover higher materials costs. The risk will continue to be in the product mix of a higher proportion of pickup trucks and larger vehicles in a volatile oil price environment....

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South Korea's Posco received environmental clearance in January 2011 for a steel plant with a capacity of 4 million metric tons a year. Posco has now been given permission to clear forest land for the $12 billion plant and infrastructure. The plant capacity will later be increased to 12 million tons a year. Indian law does not allow forest land to be cleared if villages have claims to the land. Projects by Arcelor Mittal and Posco have been held up for five years because of hurdles in getting environmental clearance and permission to clear forest land.

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This account describes the events that preceded the raid on the compound in Abbottabad that housed Osam bin Laden. The first information came years earlier during interrogation of Al Quaeda suspects in Iraq, who referred to a courier carrying messages from senior leaders. One suspect Hasan Gul referred to an important courier in 1994, and tried to disclose as little as possible. Over several years the information was pieced together leading to the courier's location at the Abbotabad compound. There was another individual living there who rarely ventured out and a seven foot wall protected the terrace in that part of the compound, making it impossible for outsiders to see who he was. Garbage was burned at the compound, and the nature of the compound with high walls and security led the CIA to believe there was a high probability that senior Al Quaeda leaders were inside. In December the CIA asked Congressional lawmakers at a secret meeting for additional funds to finance the operation. Adm. McRaven was placed in charge of the operation. A mock compound was built in Afghanistan and the attack on the compound was practiced by Special Forces. In April, Leon Panetta, who had tracked the information about the compound as head of the CIA, held daily meetings. He told his team "we've got to find out what the hell is in that compound." On April 19, Panetta informed Mr Obama that the CIA believed Osama Bin Laden was there. The same day Obama gave the go ahead for a helicopter assault....

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Canada's Conservative party leads in 166 constituencies, and is likely to win the 155 seats for a majority in parliament. The NDP is leading in 100 constituencies and will have the second largest bloc of seats. The Liberals were likely to win only 33 seats and the party Quebecois was ahead in only 3 constituencies. The NDP's gains came at the expense of the Liberals and the party Quebecois.

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Japanese stock markets after the earthquake in 2011.

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Stress-testing a portfolio and diversification, by Jonathan Burton, the Money and Investing Editor at Market Watch in San Francisco.