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Zalmay Khalizad, a former diplomat to Iraq, reports from Iraq after discussions with prominent Iraqis, describes the state of U.S. relations with Iraq under the Abadi government. He says the Ayatollah Sistani in Iraq prime minister Abadi, and Iraqi public opinion, now favor improved relations with the U.S. following the sectarianism promoted by prime minister Maliki and Iran's expanded role in Iraq. Other reports show Iraqi opinion in transition as the U.S. withdrawal promoted by Maliki has led to 2 million refugees, and huge dislocation of people with the expansion of Islamic State from Syria into Iraq. The change in opinion is also towards promoting better relations with Sunni countries. People in the region do not see a bright future with an increase in religious tensions that only lead to more destructive behaviours and increase in refugees. Towards the end of the Bush administration there was some hope that Iraq would see a bright future, only to see this reversed under Maliki's sectarian policies. U.S. public opinion has shifted away from any involvement following the failure of the people in the region to resolve differences and live peacefully. The cost of the wars with little gained as a result of the failure of the people in the region to work together in the common interest is a part of the public debate in the U.S. presidential election of 2016. Sectarianism in the region is the root cause of the growth of the Islamic State and the expansion of the war in Syria, and this has not only worsened the situation for the people in the region, delayed economic development given large oil resources, and left the region worse off than before. It has also led to the refugee flow into Europe worsening the situation in the European Union, adding to tensions in European societies such as France, Germany, Denmark and Sweden, following terrorist attacks and political parties promoting fear of immigrants. What started as a U.S. response to terrorism originating in this region in New York, followed by the war in Iraq, has led to more convulsions in this region, a huge number of refugees, whole country populations displaced, and requires a fresh rethinking about what people in the region can do to live and work together and promote the peaceful participation of people in their own development and growth, before Western societies consider further involvement. The statement about lost to Iran in the title also suggests framing of statements in the old way that are the root of the problem. When the dust settles years from now Iranians, Iraqis, Saudis, Yemeni, Turkish, Pakistani, Indian and other Muslim societies may want to look back at this period as reflecting the dangers of getting caught up in the geopolitics of world powers, letting religious sentiment override calmer thinking, and reflect on the brighter aspects of the common Islamic heritage in Iran, Turkey, India, expressed humanly as it is always is in different ways and forms. They can also take hope and confidence in the fact that European societies have struck the same rocks and emerged calmer, wiser, and better than before....

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One in six dollars generated by the U.S. economy goes to pay for health care, almost twice the average for rich countries. It hurts America in many ways; by being a burden on the taxpayer when it comes to Medicare and Medicaid paying for the poor and the elderly, on companies being one reason GM went bankrupt, it eats up federal and state budgets, rising costs make any form of future coverage for all unsustainable, and it robs other priorities such as infrastructure building and other national scale investments. The Economist says that if it had to design a system from scratch, it would go for a system based mostly around publicly funded health care. For the uninsured the solution of an employer mandate is now well accepted, so this is not an issue. What is an issue is how to make the new system affordable? Here the Economist says that whether in stages or in one move, the tax deductability of employer paid health insurance, which is costing the U.S. government $250 billion ayear, has to go. It is necessary to remove this deduction, and its something all interests involved will have to swallow, as other savings are smaller and will not be adequate. The deductability of insurance makes the true cost of insurance transparent, so it supports gold plated insurance. This does not make cost control the pressing priority it needs to be. So the deducatability of employer paid health insurance hurts both ways. The other necessary action is in the area of moving out of the current culture where most doctors work on a fee-for-service basis, where the more tests they prescribe or procedures they perform the greater their incomes. This acts as a perverse incentive, and has aruinous effect in mushrooming health care costs in America. Cutting back on unnecessary tests and procedures, and prescriptions , would save 10% to 30% of health costs says the Economist. And it says this has been proven with the Mayo Clinic in Minnesota and Kaiser Permanente in California showing that cutting back doesn't hurt care and outcomes., so much so that cutting back would occur along with improved outcomes. But Americans with employer paid insurance just take things for granted as its not much out of pocket expense for them. THis creates the lack of a force for controlling costs even as employers are shouldering abigger and bigger burden, and the employee who thinks he is doing fine actually is seeing more of his salary dollars going to pay for his health insurance. In a way the consumers of health care are stuck with the perception that they are not somehow paying for these mushrooming costs and too manytests, procedures and prescriptions. This perception leads them a false sense of comfort with the system they are in, and a fear of something new fanned by the medical lobbies, that any change will impact users negatively. This makes the whole discussion on health care or the process of finding solutions to become an exericize in which terms like "rationing" and "choice" play a distorting role. ...

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Zombrun describes the effect of low interest rates on savings for the bottom half of households in the U.S., the pressure to invest in stocks without the skills and experience of the better educated part of households in the top 20% of households by wealth and income. This resulted in a negative effect, a depletion of savings compared to an increase under a higher interest rates scenario with less pressure to take risks in a volatile stock market. This is the direct cost of the crises in stock and financial markets of 2000 caused by a internet bubble, and the larger crisis of 2008-2009 caused by the bubble in mortgages and housing. The secondary effects of the mortgage price bubble and faulty mortgage securities was in the millions of homeowners who went into foreclosure in 2009-2013, which further depleted wealth and savings of households in the bottom half lacking the experience and skills to navigate this type of housing market. The failure of the Obama administration to stem the foreclosures with practical steps which would have helped not hurt the banking sector, as suggested by FDIC's Sheila Bair and Harvard economist Martin Feldstein in many WSJ op-eds in 2010-2012, added to the erosion of savings and wealth of the bottom half. Minorities in particular were hit hard. A third effect is of communities across America that are feeling the effects of job migration to emerging markets such as China that has been underway as part of the globalization of the last three decades. A fourth effect in the rising cost of education, particularly since 2000, has reduced the opportunities for struggling working class people to enter the middle class and enjoy the higher incomes in precisely the very period when the divergence of incomes between less educated, less killed people and the more educated and better skilled people was taking place. The last two effects were neutral as part of the overall process of emergence of a globalized economy with a premium on more skills and education, requiring action by the government, universities and business for a concerted effort to mitigate in some places the negative effects and enhance in other places the positive effects. The first two effects were man made crises which required managing in constructive and positive ways for the entire American people, taking risks where necessary such as fears about the financial system if foreclosures did not go through. The risks of a long period of extremely low interest rates for savers and the middle as well as working class were poorly understood by the Fed since 2000. A similiar crisis is being faced in Europe with extremely low interest rates. Janet Yellen was only doing the honest thing by acknowledging how far and how different the situation is now compared to the period of three decades following 1945- a question not just of values cherished in America, also of the need for societies to advance through creation of wealth across all sectors of society or regress, as described by Smith in the Wealth of Nations....

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Nouriel Roubini says nationalization is the right solution. Similiar to action taken in Sweden, where the government nationalized the banks, and then after fixing them privatized the banks. He thinks about six months from now would be good timing, as most of the banks will be insolvent by then. The government does not have the risk of disturbing other solvent banks, if at that time it just moved in and nationalized the banks. Obama has cover, because already Republicans like Graham are endorsing nationalization as an option. And Republicans would prefer nationalization over putting in trillions of dollars into banks, and letting good dollars go in after bad. Roubini says that between guarantees, liquidity support and capitalization, the government has provided between $7 trillion to $9 trillion to help the financial system. Defacto the government is already controlling a big chunk of the banking system he says. This would just make it official. Another reason for doing this, is that the earlier solution of taking one failed bank or financial institution and merging it with another, as was done for Merrill, Countrywide, Bear Stearns, WaMu, is like merging two zombie banks. The result is not a stronger institution but one that is just as weak as before. In his picturesque language he says its like having two drunks trying to keep each other standing. He would like to see the big bank split into three or four pieces, creating a number of regional or national banks that are stronger. Because nationalization has become the N-word he says, it could be referred to as temporary receivership. Has Roubini been more prescient than others? No, says Roubini, a number of other people got it right. Robert Shiller on the housing bubble, Steve Roach on asset and consumption bubbles, Ken Rogoff on global imbalances in the current account deficit. He says he put the dots together and gave a more fleshed out picture. This interview was conducted by a fellow Professor of Roubini's at the Stern School of Business of New York University, Tunku Varadarajan. What about Greenspan? I think he says, a belief in market economics led to an excessive ideological belief that there are no market failures and no issues of distortions of incentives. "Central banks were created to provide financial stability. Greenspan forgot this, and it was a mistake. I think there were ideological blinders, taking Ayn Rand's view of the world to an extreme." Did the media play its proper role as this situation developed with all its inherent dangers, asks Varadarajan. In the bubble years everybody became a cheerleader, and the media became a cheerleader. The tough questions were not asked, and there was a failure there says Roubini. They failed in one of the duties of good journalism. The Masters of the Universe were on the cover, the imperial CEO, private equity, and others, no one asked how is it that this guy is producing such high returns each year, is it because he is so smart, or because he is taking on so much risk that he may face bankruptcy in two years? ...

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The language and tone of the leaders says something about what is likely to be the outcome of the G20 summit. Its a first for significant participation, as countries as diverse as Russia, China, India, Indonesia, Saudi Arabia, and the Netherlands are represented. The credible positions of both sides, the US, UK and Japan, and the European side of France, Germany and the Czech Republic, well presented, provide for some serious discussion and negotiations. France's Sarkozy and Germany's Merkel want to see a global regulator that would reach inside the borders of the US with stricter regulation. Sarkozy calls this "nonnegotiable." And he said that he would reject an agreement that puts off stringent new regulations on banks, tax havens, and hedge funds. He said "the compromise has to come from all countries around the world." US President Obama said that if there is going to be renewed growth it can't just be the US as the engine, everybody is going to have to pick up the pace," at the same time saying that the US had to be concerned about its own deficits. The fact is that the US stimulus will mostly help a severely impacted domestic economy recover with social safey net payments to local and state governments and unemployment insurance, as well as targeted investments in infrastructure, education, energy and health care. It will not mean anywhere near the kinds of imports the US made from other countries, especially China. And Obama made that clear when he said the US will never return to that situation, where the US had become a "voracious consumer market." For the Germans the major market for their middle companies is China, and China has its own stimulus spending on infrastructure spending, which should provide for continued imports of machinery from Germany at a much lower level. Thus Germany and France see a strong tendency to call the source of the crisis and repeat that call till the US listens, and refer to the failure of free market capitalism in its unregulated form. And to insist on fixing it through a global regulator with strict and systemwide rules. So you hear this in Merkel's words, "the foundation for this finacial architecture must be laid now, that is why we seem to be so tough." While the vivacious Sarkozy talks of compromise, and a US gesture in regulation in return for Franc's gesture of joining NATO, the mild mannered Merkel is clear and focussed about her concern. She rejects the idea of linking stimulus spending demands of the Anglo-Americans with the Franco-German demands for global systemwide regulation. "This is not a bargaining chip," she says. The media may mistakenly report lack of consensus as a failure of the summit. But in the long run in the presence of good positions on both sides, it could lead to some tough negotiations even if continued at another meeting. And result in something serious, credible and lasting in its impact, rather than something that was easy and did not in Andy Grove's useful words involve "constructive confrontation." ...

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Important year end reveiw of the oil price forecasting work of so many anlaysts and where they failed . The IEA and the US Enery Dpt forecast have year after year underestimated this pirce by over 20%. Analysts change the price forecasts within a couple of weeks based on changing information and assumptions. Of all this the Saudi Arabian forecasts have ben within 12 % of what has actually ocurred according to a study by Ronald Berger Strategy Consultants of Muich, Germany. And whats their forecast for 2008. By extrapolating from the Saudi budget and the assumptions, used such as giving a wide margin to avoid a deficit in the budget if oil prices undershot by a wide margin, one gets $75 for US benchmark crude. Forecast by experts are in the neighborhood of $80 average for the whole year 2008. Goldman recently revised theirs upwards from $85 average for 2008 to $95 within a 4 week period. How good is the Goldman forecast. No one really knows. Lehman has a forecast of $84 average for 2008 and bases it on the opacity of the market because no one knows what OPEC will do with supply and China does not provide good information on demand. So basically anlysts are adding an uncertainty premium to the price of oil. And this is especially so because as the Chief Economist at IEA says global space capacity is so thin and any event can influence price. Last year the rhetoric about Irans nuclear intentions was enough to stir up the price, as were other smaller events disrupting supplies. But the Iranian situation has since cooled down and diplomatic solutions are in the works. So what to expect in 2008 in the way of political uncertainty. Iraq, Iran, Palestine, Lebanon have all seen a cool off in the ast couple of years and the Bush administration rhetoric has become outmoded as has other rhetoric from Iran so that does'nt look like it will stir up oil prices in 2008. Still there will be some uncertainty premium about supply from OPEC and demand from China and India. And demand from the Middle Eastern oil producing countries themselves as well as the increasing demand in India and China will mean that lower demand in the US because of a recession will still mean an increase in global demand over 2007 of 1.5 million barrrels a day over 2007's 85 million barrels a day. What will change the dynamics of this situation is the government mandated fuel economy for all vehicles on the road with Europe more aggressive in this area under the pressures of global warming. If this impacts India, China and Russia as these fuel saving technologies are transferrred there overall consumption should see an impact. Europe's targets are only 4 years away for 2012. And the environment may cause China to bring in newer technologies that both contribute to improving environment and conserving energy. Because China's environmental record is almost catastrophic one could see some of this happen much sooner than expected after the Olympics in 2008. All that might change the way the world looks at oil and its use, and all energy sources and their use. ...

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This WSJ article provides a detailed account of the positions of Clinton and Trump on Wall Street, the financial industry, banks, Dodd-Frank, regulatory reform, 6 weeks before the U.S. presidential election.

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The Nation is faced with another Supreme Court decision as in 1868 for the 14th Amendment, in 2025 on birthright citizenship.  The 14th Amendment was written in the 19th century it had no concept of the 20th century and absolutely no idea of the 21st century we live in, unable to even conceive of conditions today, or even think of  setting rules for immigration today. It rejected the Dredd Scott decision of 1857 denying black people rights as citizens, restating the law of the land, had nothing at all to do with stating the opinion of the Judiciary on whether a mother flying in from Asia could secure US citizenship for a new born child by merely visiting the US. As in 1857, in 2025 the law is based on assumed historical facts as Lincoln said on Dredd Scott decision, that are not really true. Lincoln said in 1857- "That burlesque upon judicial decisions, and slander and profanation upon the honored names, and sacred history of republican America must be overruled, and expunged from the books of authority." The 14th Amendment was written to give black people the rights of citizens of the US, in a complete repudiation of the Dred Scott decision of the US Supreme Court of 1857 that deprived black people of rights as citizens because Judge Tanney said the British Empire had set up the institution of slavery in the American colonies and the British were responsible for the institution, little we can do about it. When by 1807 slavery was being banned in Britain and in 1838 totally banned in the British Empire. It created the idea that Americans were not the master of their destinies after the departure of the British to choose which institutions they would keep and which they would reject including slavery. Abraham Lincoln citing President Andrew Jackson said each the executive, the judiciary, Congress, and the common man were entitled to their own view of the US Constitution as they understood it. Lincoln also said Judge Tanney's decision in Dred Scott case was based on assumed historical facts that were not really true- Judge Tanney making no mention of the fact that in 1857 the British Empire had already abolished the institution for 50 years. The DJT Executive Order banning birthright citizenship shown here on the White House site has the title- Protecting the Meaning and Value of American Citizenship. It is written in  simple language in 1 page -Purpose, Policy, Enforcement and Definitions, Provisions.  The purpose clearly states that the Dred Scott decision of the US Supreme Court in 1857 is what the framers of the 14th Amendment had in mind when they drafted the 14th Amendment of the US Constitution. A reading of the 14th Amendment makes this abundantly clear. The wording comes out at the outset reversing the Dredd Scott Decision of 1857. It's repudiation was why the Northern and Southern States fought the Civil War. The National Archives say that with Dred Scott decision to allow the spread of slavery to American territories in the West,  America moved one step closer to civil war. With such  momentous events in the history of the US 1857-1868 the framers of the 14th Amendment were not sitting down to write rules about what was right for America a century and a half later.    ...

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The PBOC makes a 0.25% cut in interest rates and a 0.5% reduction in bank reserve requirement ratios in October 2015, designed to lower financing costs for business and put more liquidity into the economy.

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Christopher Lawton's interview with Stephen Elop, CEO of Nokia Corporation, at the Consumer Electronics Show in Las Vegas. Nokia will introduce a high end smart phone, the Lumia 900, at the C.E.S. gathering. Nokia has very little presence in the smartphone part of the business. In the third quarter of 2011, Nokia lost 39% of its global smartphone sales to the Apple iPhone and other competitors using the Android software. Elop says the Lumia offers a smoother experience and has social media integrated better in this product than rival smartphones. Asked about potential failure, Elop says Nokia will continue to learn from its experience and improve the product. He says Nokia is a 147 year old company and has reinvented itself in the past. He sees the competitive struggle in this business as similiar to a long marathon rather than a sprint.

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The strong U.S. job gains of 243,000, according to the Labor Department for January 2012, is a result of unusual factors and is not likely to last. Warmer than usual winter has permitted more construction activity and construction payrolls increased in Dec. and Jan. Another factor is that businesses are making up for labor requirements after the pause during the middle of 2011 from the tsunami and earthquake in Japan, and the uncertainty created by the debt ceiling crisis. The eurozone crisis, and weakness in housing will continue to affect the economy and hiring. The average for jobs created in the last 12 months was 163,000 each month. This rate of growth in jobs will reduce the unemployment rate in 2012, with fluctuations as an improved job market will bring more discouraged workers back looking for work.

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The U.S. Labor Dept. reported that nonfarm payrolls increased by 243,000 in January 2011. Of this number the private sector made 257,000 job additions and the government sector suffered job losses of 14,000. The professional-business-services industry added 70,000 jobs, including an increase in temporary workers. Manufacturing employment went up by 50,000 jobs. The unemployment rate dropped by two tenths of a percentage point to 8.3%. Another measure of unemployment the U-6 rate which includes job seekers and those in part time jobs went down by one percentage point to 15.1%. The U-6 reached a high of 17.1% in Sept. 2010.

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Data from the Center on Budget and Policy Priorities that show a Texas budget gap that is worse than New York, and about as bad as California's. The deficit in the Texas budget is expected to be $25 billion for the next two years.

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Dr Kevin Lee, a British neuroscientist, heads EpiNova, a 60 person unit within Glaxo's R&D department. Lee founded two biotech startups before joining Glaxo. The smaller units called Discovery Performance Units are Glaxo's way of creating biotech startup like units which it is hoped will produce better results. The 36 DPU's in Glaxo R&D are given 3 year budgets and flexibility to make their own decisions for drug research. The large bureaucracy, scientists not working across fields and an older mindset are seen as obstacles in the search for new drugs. EpiNova with its own logo operates in a a Glaxo facility, an hour north of London. Decisions are made faster, says EpiNova chemist Dr. Wilson, and the atmosphere is that of a startup willing to try new approaches quickly.

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Thomas Friedman sees the WikiLeaks information showing America paying the Pakistan army and intelligence services to be two-faced, to both fight with the Americans and at the same time support the insurgents fighting the Americans. He sees America being made the sucker in this game. And without the resources to change the region and transform it, America needs a better approach that does not waste its resources and energies.

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UnitedHealthcare says it will keep parts of the healthcare law relating to preventive healthcare services without co-payments, allowing parents to keep children on insurance till age of 26, even if the Supreme Court rules against the healthcare law. Most insurers see these parts of the law that are popular quite favorably.

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Leung Chun-ying takes office as Hong Kong's chief executive as China's president Hu Jintao calls for a resolution of the deep social conflicts in Hong Kong society. Leung promised to improve social mobility and boost land supply because the bubble in housing prices makes housing unaffordable for the middle class.

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The AKP party loses its parliamentary majority in the 2015 general election. It wins 41% of the vote compared to 50% in the 2011 general election. This gives it 258 seats in the Turkish parliament, compared to 327 seats in the last election. Kurds, liberals and secular Turks were part of the antigovernment protests in 2013. This part of the electorate voted for the Kurdish People's Democratic Party, which won 13% of the vote. The traditional secular party in Turkey won 25% of the vote, giving the opposition to the AKP a combined 38% of the vote. Turnout was 86% for the election. The Kurdish People's Democratic Party is led by a 42 year old human rights lawyer, who told reporters: "As of this hour, the debate about the presidency, the debate about dictatorship, is over. Turkey narrowly averted a disaster."