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Deepening frustration and economic diffficulties in Iran over sanctions. The Iranian currency, the rial, loses a third of its value.

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The U.S. responds to Iran's threat to close the Straits of Hormuz, a vital route for oil tankers.

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In over a decade after Mandela the A.N.C. under Jacob Zuma sees its vote drop from 62.5% to below 50%. The opposition Democratic Alliance wins 27% of the vote and the A.N.C. loses in the important cities of Johannesburg, Pretoria and Port Elizabeth. South Africa's urbanization is proceeding rapidly with the country 65% urban today. In this situation the country is seeing a political situation of racially diverse cities voting against the A.N.C. under Zuma's administration, which is seen as corrupt and mismanaging the economy. Zuma is seeing his support now left mostly in the rural areas. He is also losing the support of women. Mmsi Maimane is a young black lay preacher, who leads the Democratic Alliance, a party with its origins in liberal politics during the Apartheid era, with participaton of whites, coloreds, Asians and blacks in urban areas.

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Pearlstein says American Airlines (AMR) management had hoped to reduce employees count by 13,000, reduce benefits for employees and retirees and reform work rules by going through bankruptcy in the manner of other airlines such as Delta and Northwest. As it turns out AMR's unions and US Airways have made their own deal and come up with labor agreements that are likely to result in a merger deal with AMR with 1.2 billion in savings from synergies, instead of relying on labor savings for $800 million as AMR management had planned. This is because US Airways CEO, Doug Parker, sees increased savings and revenue from a new combined airline and a better hands on management team. Part of the reason is also the the way the combined airline provides additional feeder traffic from smaller cities to hubs in the east coast and midwest markets and in the Miami routes to South America. The Pension Benefit Guarantee Corporation also tacitly sees the benefit of a stronger airline so that its funds are not depleted further by having to support AMR's underfunded pension plan. The creditors have also realized what all this means by increasing the value of AMR bonds to 50 cents on the dollar from 30 cents on the dollar....

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Daniel Yergin cites an estimate by IHS Cambridge Energy Associates which shows oil from shale and dense rock, which was about 1 million barrels a day in 2011, could reach 3 million barrels a day 2020. North Dakota where much of the production is taking place is now fourth in oil production in the U.S. after Texas, Alaska, and California, and is likely to move up to second place. U.S. imports of oil come primarily from Canada 25%, Mexico 11%, Venezuela 9%, and the Persian Gulf 16%. Canadian oil sands development has increased production and the completion of the Keystone pipeline will increase the share of oil imports from Canada. This is shifting the dynamic of oil away from the Persian Gulf, with the volatile politics in the region, and more towards North America.

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Even though U.S. president Trump has singled out countries such as Mexico, South Korea and China for trade practices, the U.S. today faces stronger competition in trade from Germany. The trade surplus with Germany for 2016 was $297 billion for Germany compared to $245 billion for China, according to Ifo economic institute. China's trade surplus according to the World Bank was down from 10% of gross domestic product or GDP in 2007 to 3% in 2016, while Germany's has gone up to 8.5%. The Chinese currency is seen as not being undervalued by some experts, while the euro has lost a quarter of its value in the last 3 years, giving Geman exporters an edge. The U.S. also competes with Germany in nine of the 10 export categories such as machinery and electronic equipment, according to the Peterson Institute. Then why is the focus under U.S. president Trump not including Germany? One reason is that China's products have put a downward pressure on U.S. manufacturing wages, and the the speed with the Chinese manufacturing has grown in certain industries. Germany has very few of the manufacturing subsidies that China provides to its industries. And the depreciation in the euro is not favored by the German government as it opposes the policies of the European Central Bank. Germany also has a higher propensity to save about 10% of GDP compared to about 3% for the U.S., according to OECD. As a result Germany is accumulating foreign assets at a faster rate than any other nation, while the U.S. is borrowing capital from overseas. Ways to change this are minimum wage regulations introduced by the government, but larger measures such as increasing government investment in the economy are not supported as the country prepares for the future with an aging population.   ...

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As BP reports large losses in the second quarter resulting from its focus on safety, and building a smaller but more profitable company, BP's CEO Dudley says- "One of the things we are not going to do is drift off the path of focus on safety." He emphasized this by adding that "stepping up the accelerator of performance in place of that is not going to happen." BP has cut overall production from 3 million barrels a day in 2009 to 2.3 million barrrels as it focuses on safety and profitability. Dudley says "its going to be value over safety." As it finishes repair and improvement work in the Gulf of Mexico, BP will repeat the exercize in its North Sea fields. Extensive maintenace work is leading to extended shutdown periods.