LyrArc Article Gist
U.S. gasoline prices at the retail level have come down only marginally with lower Nymex crude prices. The reason is the large difference between world crude oil prices and the prices for Nymex crude. Oil demand is expected to go up by 6.1% in China and 3.6% in India according to the International Energy Agency. J.P. Morgan Chase expects oil demand to grow by 1.2 million barrels a day in 2011. The IEA estimate is for 600,000 barrels a day increase for 2011.

LyrArc Article Gist
Stephen Roach, Asia chairman of Morgan Stanley, sees prospects of a global double dip recession as a very real possibility. As Europe feels the effects of the debt crisis that started in Greece, China sees the negative effects in its largest export market. The European crisis is a serious negative to China's dependence on exports for growth. He sees it very diffficult to unravel the kind of problems from the contagion without adustments in the form of economic contractions in the global economy.

LyrArc Article Gist
The new government of prime minister Naoto Kan in Japan has tapped 2 business executives for posts as Ambassador to Greece and Ambassador to China. A former top executive at Nomura Securities heads for Greece, and former CEO of Itochu Corporation heads for Beijing. It is an effort to stay on top of changes in the global economy with experienced businessmen. Kan's idea is to harness the needs of Asian countries, finding solutions to problems, to raise the Japanese growth rate.

LyrArc Article Gist
A new CEO, Takahiro Hachigo, takes over at Honda Motor in Feb. 2015, following quality issues and problems with the faulty Takata airbags. Hachigo is a younger engineer who was managing officer for China. Executives with more experience were bypassed in the selection. This follows Toyota's selection of Akio Toyoda, a younger executive with international experience as CEO, and his successful track record in handling the Toyota recalls for unintended acceleration. This may have persuaded Honda to go with an unconventional choice.

LyrArc Article Gist
With the ITU voting to let governments control the internet, the decision of the Obama administration to not renew the Commerce Department agreement with Icann to provide oversight and governance looks increasingly ill advised. China, Russia and other governments lack the same committment to an open global internet that the U.S. has. Esther Dyson, founder of Icann, says this is a bad idea. Icann provides the .com and .org addresses for the internet. For Dyson UN oversight is "a fate worse than death."

LyrArc Article Gist
GM' second largest market is China where it sold more than a million cars in 2007 and sales growth was 21%. Brazil is the third largest market. Russia is the fastest growing market with sales growing 75%, and it has a favorable pricing environment in Russia with growing class of more affluent buyers as Russian economy grows quickly. And India is a market that GM is trying to buildup sales with the introduction of GM's Spark car. Overall this should enable GM to maintain momentum even as sales in N. America declined 6%. Toyota's N. American sales declined 4% so it is seeing a slowdown there also. But compared to GM which has 65% of revenues from N. America, Toyota has 40% of revenues from N. America and 30% of global profit.

LyrArc Article Gist
Berlin based China studies center MERICS experts say China's weak spot is domestic consumption, as it is too reliant on export demand. These experts say overseas demand from Europe and US has held up in recent months, but where would China pick up manufacturing production when this demand slows down? Stimulus is seen as risky by experts and contradictory to efforts by the Chinese government to reduce debt based financial risks, with the debt built up in hypergrowth of two decades since 2000. Much of this hypergrowth itself has resulted in trade tensions with US and today puts China in what MERICS calls this "tricky situation." This situation resulted from growth since 2000 that was was unleashed from local governments in China with failure to control it from the central government in Beijing to reduce its impact on deindustrialization of towns and communities in the US and Europe. A lesson that China's planners may be looking at as they look to the future for more balance and quality of life,  and dignity of life for rural, town and city communities across China. Politburo CCP's standing committee has put forward the idea of a "dual circulation economy" to reduce dependence on foreign demand, and balance it with growing domestic demand, yet experts at Berlin base MERICS say this has not happened. A report from the Atlantic Council says without domestic demand picking up the pace of China's growth, China would have difficulty growing beyond 3% annually by 2025.  ...

LyrArc Article Gist
Vietnam has seen rapid growth in the last 20 years as it joined the shifted away from the state planned economy similar to China in the late 1980's, joined the worlds trading system, freed up the economy and attracted foreign investment. But something doesn't seem right. Looking at the Vietnam growth curve, growth in Vietnam's GDP vs growth of world GDP the curve seems to be following a similiar pattern, there is a sharp downturn in the early 1990's with a V shaped bounce back and a sharp downturn in early 2000 followed by another V shaped bounce back in growth to this date. As America begins its first of several years of credit contraction and investment contraction followed by similiar patterns in some European economies like the UK, Ireland, Spain and a slowdown in the rest of Europe, the question hangs over growth in Asia, from South Korea and Taiwan where recent elections reflected these concerns in electing politicians who promised new ways of kickstaring their economic growth, to China, India and Vietnam where the concerns are about how to meet the growing expectations of the large numbers of people, probably the majority of the people in these countries who have been left out of the economic development experienced in urban areas and by the new middle class. Corruption, the stock market collapse or severe setback, and a slowdown in their main export markets, and are problems shared by all 3 countries China, India and Vietnam. India and Vietnam share the problems of a poor infrastructure. In this new environment Asian countries will have to come up with innovative solutions to maintain growth and quality of growth, as some of the chaotic growth of the last 20 years may have come at some cost like that of the environment in the case of China and better solutions can be found than growth that sacrifices goals in health care and other necessary goals of balanced development....

LyrArc Article Gist
This NYT report looks at the Kushner family's history including problems the family real estate business has from family troubles over two decades. Jared Kushner, 37 years,  is senior White House adviser. The report says the rise in prominence of the Kushner family in politics has adversely affected the family business because of increased scrutiny and investigations, and deals with China for financing have stalled as a result. A major project of the Kushner family, a 41 story dilapidated Fifth Avenue Tower in New York that was to be replaced with a new structure now lacks financing from Chinese investors as a result of public scrutiny. Only 10 months are left before a $1.2 billion mortgage on this aging property lacking enough tenants comes due for the elder Kushner. 

LyrArc Article Gist
History will see the lack of working on a bipartisan basis from the beginning of the Trump and Biden terms to stop illegal migrants and fight CMC (Canada, Mexico and China) on fentanyl flows as a blot on both parties. A remarkable change has happened in a matter of 100 days in Canada's stance on immigration and fentanyl flows. Trudeau now calling for eradication of fentanyl, his deputy prime minister saying Canada has more fentanyl deaths per capita than the US because of smaller population, and the need to wipe it out off the face of North America. The Canada Conservatives generally support DJT. The Trudeau Liberals have shifted policy to support DJT policies on immigration and fentanyl flows. In general Canada is making a pronounced shift towards support of the US position on immigration.  It is not just DJT policy as closing the border was part of the agreement agreed by Biden in 2024 with Republicans in Congress led by Lankford-Graham-McConnell which was not passed because it was too close to the election. One can only say the Covid pandemic, vaccination shortfalls, failures of supply chain distracted Biden from acting early and similar to DJT on the first phase of immigration action on illegal migrants committing offenses. The release of illegal migrants across the US is something that Democrats will years from now see as a major error in its policies. History will see the lack of working on a bipartisan basis from the beginning of the Trump and Biden terms to stop illegal migrants and fight CMC (Canada, Mexico and China) on fentanyl flows as a blot on both parties. ...

LyrArc Article Gist
Peter Navarro's thinking is genuinely felt and genuinely thought out after 20 years  at Harvard, UC Irvine and other universities, as an economist who abhors sitting in the office with textbook theory that has no relevance to life of working families in the heartland of America. He says of these textbook theory economists and the American companies that have recklessly shifted America's industrial base to China year after year and decade after decade- “The same damn fools who supported NAFTA, China’s entry into the W.T.O., and every other trade deal that was supposed to benefit America but only benefited Wall Street and the foreign nations screwing us. Those mainstream economists need to get out more often — maybe to Ohio or North Carolina or Pennsylvania or Wisconsin or Michigan.”  He says the 70 nations including the big ones Japan, South Korea, Taiwan, India, Britain and the European Union are already neogtiating with the Trump administration. What more proof does one want. The Nation will get a better deal as it is about fairness in world trade, and an even playing field. Navarro calls it "a beautiful thing." The three dimensional unique approach taken by Navarro, Bessent and Lutnick and by Trump is working, says Navarro. Fifteen decades ago A. Lincoln stated- "The dogmas of the quiet past are inadequate to the stormy present. The occasion is piled high with difficulty, and we must rise to the occasion.As our case is new we must think anew, and act anew. We must disenthrall ourselves, and we shall save our country."   ...

LyrArc Article Gist
An example of the kind of information spread even in BBC and American media about US inability to make the most advanced chips because TSMC founders have decades of experience. In fact TSMC founder Morris Chang acquired his experience in chips in the US. The decades of TSMC experience are merely since the late1990's. The US was the only country making these chips when China was mostly an agricultural economy in the 1990's. It is only because of hidden subsidies and bad economic theory, that US let the chip technology be outshored. As soon as the people of America make the decision, bad economic theory will be discarded, and US will support its own chip manufacturing under bipartisan support in Congress and the White House, with the full support and funding of the American government.  The US can get things done once it makes up it's mind as the whole Nation. Advanced chips will happen very quickly in the US with the process already under way and supported by the whole Nation. People forget that bigger than chips, bigger than technologies of today, the Industrial Revolution of the 20th century began under Frances Perkins and Franklin Roosevelt in New York during FDR's term as Governor as New York State. It was at that time that New York state  was setup as the model of industry and labor, with new institutions and industrial landscape engineered by FDR and Perkins. This was transferred to 50 states during the 1930-1950 period- this is the industrial structure and economic structure that brought the Second Industrial Revolution in the 20th century to the world. Taiwan did not exist till 1950's emerging from Japanese rule, China from Japanese occupation till 1945, not emerging till 1990. ...

LyrArc Article Gist
US president Biden proposes to reduce the US deficit by $2 trillion by increasing taxes on American households worth more than $100 million that would apply to their earned income, and their unrealized gains on liquid assets like stocks. Biden also plans quadrupling the tax on stock buybacks by companies, a tax approved in the Inflation Reduction Act of 2021. The deficit in 2023 will be about $1.4 trillion and rise to about $2 trillion, so that Biden's plan is to practically eliminate the  large deficit if the Republicans come on board. Republicans prefer cuts in spending. US companies have engaged in a dramatic increase in stock buybacks in recent years leading to calls for increasing the tax on stock buybacks. Biden says even high income households will not see an increase in their taxes, only the wealthiest households with over $100 million who have benefited vastly through the Reagan type policies of the last two decades. These households with over $100 million in assets will not be affected in the same way as students, workers, and middle income households are affected in shouldering a large part of the burden of these Reagan type policies that did not adequately fund education, healthcare, and manufacturing in communities across America. This was a period when Democrats in Congress awed by Reagan type policies failed to vigorously oppose policy that increased the US deficit and burden on households for health costs by not allowing Medicare to negotiate prices with pharmaceutical companies. A senior AARP official says that when we talk about the Biden Inflation Reduction Act of 2021 the key component is the Medicare price negotiation with companies that is now law. Why Republicans and Democrats before Mr. Biden allowed such a gross distortion for two decades since 2001 that burdened ordinary  working Americans while neglecting American manufacturing, till Mr. Biden assumed the presidency, says much about the policies of the last two decades and how it has affected ordinary working families. Shriveling factory towns and creating much distress in these communities with these distortions that are a legacy of Reagan type laissez faire policies that government should do little. The result of these policies is that manufacturing is concentrated in only one country for the whole supply chain something that would never have happened with a thoughtful policy planning process. India and Vietnam are only today seen as alternatives for the supply chain in 2023 when policies were in place in these countries since 2014 for the supply chain to be distributed in a way that would be a win-win situation for all countries, avoiding the national security threats of today with overconcentration of manufacturing in China. This has not benefited China or the US because of the rancor and tension it has created. It was the fall of the Berlin Wall that created some of this awe for Reagan, when looking at it objectively it was nothing more than a course correction in Europe after the Hungarian revolution suppressed in 1956, Czech in 1968. It had little to do with what policies the US should pursue for workers and families, just as the war in Ukraine today remains another course correction in a different direction in Europe, and does not affect domestic policy in the US to build a better society for workers and families that Mr. Biden is doing. ...

LyrArc Article Gist
This picture essay in The Guardian shows the 700,000 additional people displaced inside Afghanistan in 2021 in addition to the 2.9 million displaced people by 2020. The British stayed out of Afghanistan except for brief forays from concern about Russia entering close to British India. Not much happened till Zahir Shah, the King of Afghanistan was seen as not doing much for a famine that struck the country in 1972. Drought struck much of the country in 1972 leading to the deaths of over 100,000 people from starvation. The King had ruled since 1933. And for a brief period his cousin and brother-in-law Daud Khan had actually run the administration between 1953 to 1963, before being dismissed with a new constitution adopted not allowing the royal family to rule the country without consulting parliament. The poor handling of famine relief led to the fall of the government appointed by King Zahir Shah in 1972. In 1973 Daud Khan violates this constitution and assumes control of the country. British India was in 1972 the India of the Nehru period, with his daughter Indira Gandhi the democratically elected prime minister. India fought a brief war with Pakistan in 1971 that set up the new nation of Bangladesh from territory of East Bengal. India preoccupied with Bangladesh refugees did not do what the British had done to keep outside powers out of Afghanistan and maintain a stable monarchy. Daoud Khan's repression of Communist party leaders led to Communist party military factions in the army taking over the country in 1978. The Afghan military led by officers in the army's Communist factions had little support in the traditional Islamic nature of the countryside for their land reforms. Leading to a rebellion and entry of Soviet troops under a friendship treaty signed in 1978 with Soviets under Leonid Brezhnev. It is this disrupting of the stability of the Afghan monarchy or the entry of Soviets or Americans or any other foreign influence that was carefully prevented in British India by Britain's India policy, which resulted in a period of peace and stability in that region. The events of 1974 with the fall of the monarchy, and the entry of Russia in 1978 broke two of the main rules the British had observed from 1750- a stable monarchy and no outside influence in Afghanistan. A policy the British also followed for Tibet. When China entered Tibet in 1950 Nehru was too preoccupied with the millions of refugees from Pakistan and failed to prepare in the years 1947-50 for following British policy on Tibet by preparing or anticipating the entry of foreign powers. The entry of China into Tibet in October 1950 led to the Sino India border war of 1962, and led to the current situation of India facing a Chinese army all along the border of Arunachal Pradesh, Ladakh, Nepal and all the way in the Himalayas to Kashmir. The result has been billions of dollars spent by the US every week starving domestic priorities, as president Biden observed this week, and a burial place for empires. Ten years for Russia, and twenty for the US with the same result. It has left the whole region poorer and in humanitarian crisis for 50 years, and created crises for Russia, Pakistan, India, and the US. ...

LyrArc Article Gist
China's export performance is stalling. Chinese exports to the US fell by an annual 6.5%. The exports of China have risen by 8% over the prior year yet this was over 2022 when China was under a lockdown. South Korea and Taiwan which supply parts to Chinese factories had exports drop by 14% over prior year.

LyrArc Article Gist
Steep discounts continue to hurt profits at GM by eroding margins. Profits were $300 million lower because of discounts. With special gains GM's profit was $3,687 per vehicle in North America, without the gains it was $1,653 per vehicle. Ford made $2,806 per vehicle. Emerging markets showed adrop with the car market in China cooling off. One of GM's joint ventures with SAIC Motor in China saw a decline in sales of 32% in the 1st quarter. Chairman Akerson said the challenge facing GM was to reduce incentive costs, and cost cutting to counter rising commodity costs that pushes up the cost of finished parts. On car buying patterns, Akerson says its not all about smaller cars as the smaller fuel efficient SUV's are also attracting buyers, and the smaller cars are better equipped and have higher prices.

LyrArc Article Gist
This report in The Guardian shows that ChatGPT is nothing new. The first version of this kind of generative AI was developed in 1966 at MIT by a computer scientist Weizenbaum, who called it Eliza. The buzz around it like that around ChatGPT was that it was thinking and acting on its own, the way humans like to think it did, but in fact Weizenbaum showed that it was simply code written to take what was given to the computer as input and spitting it out in a different way that made it look that it was acting on its own, when it clearly was nothing but parroting it out like a parrot. The issue of turning our world over to robots based on AI is controversial and even dangerous. A Japanese futuristic movie shows how the man who has written the code for the master computer that runs everything in Japan is disillusioned about it and finds himself in a nightmare world where the machine tries to isolate and eliminate the man who created it. Machines cannot think or have emotions like humans do and it is these emotions, rethinking, that the world depends on for its survival. Can anyone say that a machine would have made the decision that Chinese president Jinping just made in January of making a complete u turn and moving away completely from lockdowns into a complete opening with a plan that appears to have worked and is reviving China's economy following the street protests by informal groups including young women? ...

LyrArc Article Gist
This report in NYT looks at the Barbados debt crisis. Barbados spends 55% of its budget to pay interest on debt (servicing the debt). That leaves about 5% for health and climate change. Years of borrowing that ignored basic rules of financing have created serious problems that were compounded by the pandemic and hurricanes. This report shows that the total deb of Barbados was not known to the central bank. Borrowing was approved at exorbitant interest rates. One loan with Credit Suisse for $150 million is shown here with interest rates that lead it to become a catastrophic amount owed. Many such loans without any checks and supervision of total loans taken, lack of financial prudence rules followed, lack of transparency and alerts on borrowing and spending tend to create this kind of situation in many poor countries. About two thirds of developing countries are in this situation owing one third of their budget for debt service or paying interest on the loan. The situation is unstable to begin with. Then on comes along a hurricane or natural disaster such as the pandemic and the unstable situation becomes a catastrophe. Sri Lanka, Pakistan, the Caribbean nations, nations in Africa, face debt crises that are getting worse. It is not inevitable or destiny for nations today, consider the examples of large nations such as Japan, China, South Korea and India, Malaysia, Indonesia, and one can see that development finance can be prudent and responsible, so that situations such as the pandemic can be handled without going into disarray. ...

LyrArc Article Gist
Meg Gentle, who helped build the first LNG terminal for Cherniere Inc. in the Gulf Coast of the US for export of natural gas extracted in the US, is now switching to work in green hydrogen production. The first facility goes up in Texas by 202 7after an experimental project in Chile. WSJ shows many former fossil fuel executives are taking this route to green hydrogen. Gentle says the nascent green hydrogen industry is similar to the beginnings of natural gas. She says there are all the same elements in both. And that the new companies can go from one plant to create a new transformation just like that done for LNG. A chief technology officer of Airbus, a head of GE Europe and China, and an Italian from Eni Enel are also working at green hydrogen companies. What has turned an historically uneconomic business into a possibly profitable business are subsidies from president Biden put in place for clean energy. These subsidies now cover 60% of the cost of green hydrogen, says the WSJ. Green hydrogen requires permiting, infrastructure, financing, customer agreements, similar to the fossil fuel industry. Many are joining for the challenge as green hydrogen when converted into a liquid for transport can't carry as much energy as fossil fuels. About 120 startups raised $2.6 billion in 2022, a 50% jump from 2021. The GE executive says no one has done this on scale making the opportunity enormous. ...

LyrArc Article Gist
In new developments German chancellor Scholz visits London and European Union president Von der Leyen visits Bucha and Kviv in Ukraine. Von Der Leyen is accompanied by Joseph Borell, the EU commissioner for foreign and security affairs. For the first time the European Union offers membership in the EU to Ukraine. In handing a document with a questionnairre to Ukraine president Zelensky she says- "This is where your path towards the European Union begins." Adding "It will not be, as usual, a matter of years, but rather a matter of weeks" to complete this step. The questionairre forms the basis of an opionion she said that gets passed on to the European Council this summer. Ukraine now becomes the first country in Europe to have fought a war and suffered from millions of refugees just to join the European Union. It also shows how much has changed since Angela Merkel left office with her policies that offered Ukraine no such prospect even as it integrated the German economy with the Russian economy and China's economy during 4 terms in office. Leyen said "Ukraine is marching towards a European future." Chancellor Scholz addressed the German parliament after the invasion and hundreds of thousands of people turned out in Berlin that day.  Europe is voting with its emotions having been completely shaken by this experience. Leyen writes " It was important to start my visit in Bucha. Because in Bucha our humanity was shattered." ...

LyrArc Article Gist
"Trees not Warehouses" read signs protesting the building of more warehouse space in the US as residents protest the bringing of more noise, pollution and heavy duty trucks to their neighborhoods.Companies added over 1.5 billion square feet of new industrial space across the US from 2017, says this report in WSJ. A similar wave of building industrial space is taking place in Europe for warehouses. Communities from Pittsburgh to Madison, Wisconsin and neighborhoods in expanding logistics regions in Southern California and eastern Pennsylvania. Many say their communities are under siege. To get goods to people faster companies are still planning but have not made the shift to bringing construction back home or closer to home so that this kind of huge warehousing space is no longer needed. Much of this warehousing space may no longer be needed as more sustainable, more reliable,  shorter supply chains take the place of current ones that have concentrated all manufacturing in one country, China, at the hidden costs to local communities and companies. Through many hidden costs that have not been fully quantified in terms of quality of living in communities, loss of jobs and infrastructure through loss of tax revenues, carbon footprint of products shipped over thousands of miles, hidden logistics costs, rampant inflation in logistics costs, and significant loss of manufacturing knowhow that cannot be easily replaced. This is a result of decades of building such supply chains that no longer fit the needs of today. ...

LyrArc Article Gist
This report in WSJ shows what offices would look like in a coronavirus economic reopening. Till a vaccine is developed in about one year from now what will the gradual reopening look like?   It shows a cafeteria at a company in Seoul with plastic shields separating each person, the Amsterdam office concept of six foot distancing offices at Cushman & Wakefield. This real estate company manages 800 million square feet in China real estate. It has developed a 300 page manual on safely reopening offices with every detail possible. Toyota plants will run at slower speeds because of large drop in demand, with plants reconfigured to maintain social distancing. Many companies are doing this now when it is easier to do without people. Protocols such as onsite health screenings are being integrated. A Knotel app  will add features for office tenants that gives employers the option to track some employee movements and trace their contacts to prevent illness. For sports and event venues the challenge is sanitation and cleanliness. Adding janitorial cleaning shifts and making food grab and go, cashless transactions and protective shields. Schools and colleges face a challenge of how many students to let in, and how many to seat and how, dorms with one room one student, and so on. One college in Maine is planning for thinning the students on campus, rotating students with shorter term modules, more online instruction.  ...

LyrArc Article Gist
The failure of three layers of quality checks Boeing are shown here in the WSJ video after failure events on airline flights. Two CEO's step down. What is the real problem? It is that the company is run by executives trained in finance and accounting and have too little of a background in the workplace where the manufacturing and assembly components is taking place or grasp of what it takes to turn out quality products by workers on the line. The basic approach is flawed because it is not quality checks that build in quality into a product but the workers on the assembly line who have to be trained and the investment made in quality processes to turn out a quality product. This has long been a focus in the earlier days of America's industrial revolution till the focus shifted to finance in the US and the focus on manufacturing shifted to Asia, to Japan, China and now India. It will take a complete shift in America's company leadership to hands on CEO's who are with and understand the workers on America's assembly lines, who can live some days and nights with workers on the production line to see and feel the problems first hand. This will take a decade, and for America as Jake Sullivan said at Brookings for president Biden and his team- this is a fight we must, and we will achieve. ...