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The port of Long Beach which takes in 20% of the container shipping of the USA,, and is next only to Los Angeles port in container shipping, is becoming a story of two economies, the American and the Chinese. Thousands of cars from Toyota, Nissan and Mercedes are piling on port property turning it into one huge parking lot, as dealers across the country say they have no need for them, and piles of paper and metal baled together to be shipped back on these ships to China to be recycled into cardboard for export boxes are also piling up as China no longer needs them. The drivers who drive the trucks are also being laid offf and looking for new jobs, which are signs that a deeper economic downturn is underway and the the Detroit automakers GM and Ford CEO's who told the Banking committee that they are making their estimates for 2009 on the basis of a 13- 14 million vehicle sales year may be in for another rude shock. The figure for the last quarter may be running at 10 million, and if this continues into 2009 as its expected to do, even the producton of cars after accelerated plant closures may have nowhere to go in 2009. Which is why there are so many questions about what is going on in the auto industry and so much need for candour and frank discussion that was missing in the evasiveness apparent in the Senate hearings on November 18, 2008, as CEO and union president skirted around the issues and senators failed to ask many other questions like these on what is happening on demand as well as many others....

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Spiegel Online describes the discontent with the Tsipras government after two years in which it failed to keep promises of reducing the impact of austerity cuts on pensioners. government employees, teachers and other groups. Now riot police buses are situated in the street facing the presidential residence in Athens. In early 2015 after Tsipras won the election the police were removed from the area. German Foreign minister Schauble is for no further concessions for Greece's debt programs till after federal elections in 2017, and austerity cuts continue to affect people in Greece. About 90% of Greeks are dissatisfied with the Tsipras government according to a recent poll. Tsipras had said he would stop privatization projects when elected, now he is moving forward with privatization for airports and other state assets.

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James Pressley, in this review of Joseph Stiglitz's new book- "Freefall: America, Free Markets and the Sinking of the World Economy," says Stiglitz's advice should be taken into account by the new administration. Stiglitz, says, the Obama administration has so far offered no alternative vision of capitalism and is only "mudddling through." It is simply following the course the Bush administration had taken. And has retained as key economic advisors, Geithner, Ben Bernanke and Summers, all from previous administration's economic teams, thus largely removing the possibillity of serious change. And by doing so, says Stiglitz, the Obama administration has "squandered the opportunity," to fix things that needed to be fixed in the economy. Stiglitz, says Pressley, urges Americans to think what kind of America they want to see, what kind of society they want to make, and then what kind of economy will get them there. Stiglitz wants to see banks back to where they they only make loans, and act as an efficient payments system, and not engaged in risk taking. At a meeting of the American Economic Association, Stiglitz, presented a paper that suggested that between globalization for integrating world financial markets and keeping them separate, the latter is the better course. Financial markets he believes, need circuit breakers to not bring down the whole system....

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The 90 minute nationally televised debate in Germany between Angela Merkel and Peter Steinbruck before the September 22, 2013 national elections.

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Britain's Tax Service reports the number of taxpayers reporting incomes of 1 million pounds a year declined by over 60% in fiscal 2010-2011 from the prior year. In 2010 the Labor government of Gordon Brown introduced a 50% income tax rate for this income group, up from 40%. The number of million dollar incomes filed declined to 6000 from 16000 in 2009-2010, and revenues declined from 13.4 billion pounds or 9% of total taxes from taxpayers to 6.5 billion pounds or 4.4% or about half. The Labor government had hoped for additional 2.5 billion pounds in revenue, showig unintended consequences and surprises in economic policies.

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Afghan warlord of a previous era Hekmatyar is proving difficult to buyout or win over, a strategy pursued with Iraqi insurgents. Younger Taliban insurgents are even harder to convert or buyout. THis raises questions about the chances of this kind of effort succeeding in Afghanistan, especially considering the "allergy" to foreign presence or foreign boots on the ground among Afghan people and the part religious fervour plays. Religious fervour was much less of a factor with Iraqi Sunni insurgents. Add to this the terrain differences, between desert and high mountains, makin the kind of house to house searches and securing of areas extremely difficult.

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The "cut, cap and balance" pledge of Republican candidates for the presidential election of 2012. The current House version requires capping federal spending at 19.9% of GDP by 2018. This say House leaders is in accordance with the average spending levels for the last 30 years. It would have to come down from 24%. The balanced budget amendment caps spending at 18% of GDP and a balanced budget within a decade. The pledge is written promise to cut spending immediately.

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Lt. Gen Trainor and Michael Gordon describe the situation during the last months of U.S. presence in Iraq. President Obama is ambivalent about the size of the military presence he would like to leave, settling for 3000 troops and a few F-16's from a inital figure of 10,000. Obama sees the presidential election approaching and sets an objective of keeping it minimal. The military cooperation treaty with Iraq has to be approved by a Iraqi parliament with different factions in parliament not likely to approve it. Prime Minister Malliki decides not to move ahead. In the end no military cooperation treaty is signed after 8 years of war and a date is set for a complete withdrawal. Iraqi airspace is used by Iran to ship supplies to Syria's Assad regime, and the U.S. has less leverage in the region as the Arab world goes through a transition to popular government and elections. The Obama administration shifts most of its attention to Afghanistan where the U.S. has no vital stake in the long run compared to the Middle East region, with its large population, growing economies, move towards democracy and meeting the aspirations of hundreds of millions of young people. One Middle Eastern leader says the U.S. had no long term policy under the Obama administration for Iraq, and this applies also to the rest of the Middle East region, and mostly reacted to events as they happened. The Obama administration's committment to the war in Afghanistan, just as it focussed on winding down the war in Iraq, responded to the American public's waning support for the war in Iraq. It did not reduce the total cost of the conflicts because of the initial escalation of the war in Afghanistan and later slow progress towards a negoiated settlement to that conflict. A negotiated settlement is the best the U.S. could achieve, and the best desired objective considering the limited interests in Afghanistan. In Afghanistan most of the dynamics would be determined in the long run by the situation in Pakistan, and India-Pakistan relations, which the U.S. could influence constructively only through dialogue, promoting cooperation between the two countries, and economic relations....

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One of the quirks of the unemployment rate released by the Labor Department is that it is declining- declined to 8.1% from 8.2%, from March to April 2012- even though the number of unemployed may be increasing. When adjusted for the discouraged workers who would be working today in a more normal environment the unemployment rate today would be around 11%. Crucial in grasping unemployment numbers is the labor force participation rate- showing the number of working age Americans with jobs or looking for jobs- which is affected by the number of baby boomers retiring and leaving the work force, and by the number of workers who are too discouraged to look for work. The long term unemployed currently form about 40% of people unemployed in the U.S., which is quite high and cause for concern for Fed chairman Bernanke. Many of these long term unemployed it is feared will permanently drop out of the workforce, causing a drop in the productive potential of the economy and lowering economic growth. Already many have dropped out of the workforce, causing the labor force participation rate to decline faster than the gradual decline seen in the last decade as baby boomers retire. Between 2009 and 2012, a three year period, the labor force participation rate dropped about 2% to 63.6%, compared to the normal drop of 1.3% over a seven year period from 2000 to 2007. Combining the impact of the two trends, one demographic and the other a result of the 2008 global financial crisis and excessive risks in the U.S. banking system, leads analysts to to lower the longer term economic growth forecast for the U.S. to 2%, compared to the U.S. Fed's forecast for 2.3-2.6% growth....

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On the production side output has fallen to an estimated 1.6 million barrels a day(U.S. government and independent analyst estimate) from nearly 3 million barrels a day in 1998. But even this is an estimate, PDVSA says its daily output is about 2.2 million barrels a day, and plans to boost it 4 million barrels a day by 2012. PDVSA points out that the oil exports to the US have remained steady at 1.5 million barrels a day. The content links to oil policy are 1. PDVSA direct involvement in economic development and social goals. 10% of annual investment budget to go to socail programs or about $1 billion a year. For private oil companies in joint ventures with government 3.3% of the local investment budget is required to go to social programs. Oil service companies include community projects such as low income housing in their bids. And spend 5% of the value of the contract in hiring worker owned service companies. Adding road construction and subsidized food programs the spending approaches $8billion for 2005 according to PDVSA. quote: "its not easy... but there will be no more projects with their backs turned to our reality." Rafael Ramirez President of PDVSA told industry executives in June. 2. According to the WSJ PDVSA's diminished production has cut world output by more than 1 %. PDVSA's 2004 financial results show exploration investment was only a meager $60 million in 2004 down from a small $174 million in 2001. Current wells are so old that that the ir output declines by about 23% a year, drilling new wells only keeps production levels stable. This decline can be seen also in the backdrop of the major strike in late 2002 and early 2003. At the time Chavez fired 19000 employees of PDVSA who opposed his policies. The employment levels are only now back to pre-strike levels. ...

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Recruiting in the Afghan army from predominantly Pastun areas in the south and southeast is way down, almost nonexistent. For Kandahar, Helmand, Oruzgan, Zabul, Paktika, and Ghazni provinves with largely Pashtun people, the numbers show they make up 17% of the population and contributed only 1.5% of new recruits to the army since 2009. Kandahar and Helmand with 2 millon people contributed about 1200 recruits, or less 1% of 173,000 new recrutis since 2009. The northern provinces make up a large number of the new recruits, with Kunduz having a population of 900,000 and contributing 16,500 recruits. There are about 42% Pastuns in the population and a similiar number of Pastuns in the Afghan army, but most are from the northern or northeastern provinces where the insurgency has been weaker. One third are from one northeastern province- Nangarhar. The reason for this is fear of the Taliban finding out that that a young man has enlisted in the south and retaliation against the enlistee or his family. The lack of a southern Pastun presence in the army makes the army more of a northern institution. With withdrawal of American and NATO forces by 2014, this leaves Afghanistan deeply divided between the northern and southern regions. The southern region Pastuns have a significant presence across the border in the northern part of Pakistan, and the southern Pastuns draw support and resources from this region. Removing the foreign presence shifts the balance towards the southern Pastuns and Pakistani Pastuns in the largely mountainous country of this region. This is why the project in Afghanistan requires the support of all factions and ethnic communities in the South Asian region to succeed, setting aside differences and animosities of the past. D. Mahmood Khan, a member of parliament in Kandahar says ordinary Afghans in Kandahar see the Afghan government of Karzai collapsing in a week or two without foreign support and sense a much stronger Taliban....

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The feud between New Jersey Governor, Chris Christie, and the head of the state teacher's union, Ms. Keshishian. Governor Christie called the state legislature into an emergency session and pushed through a 2% cap on annual increases in property taxes, which have risen 70% over the last decade in New Jersey. The issue is whether the extent of spending on education is sustainable in New Jersey. New Jersey's median property tax is the highest in the nation, at $6,579. By comparison New York is $3,755 and Illinois $3,507. New Jersey residents pay an average of 11.8% for property taxes. Both sides have engaged in strong rhetoric and the teachers union has attacked the Governor in television ads. Governor Christie refused to discuss issues with Keshishian, and ended a meeting in his office, with "Not with you. I don't." The teachers argues that New Jersey schools provides some of the best schooling in the nation- the state's high school graduation is 82%, and it ranks among the top 5 states in key subject areas, according to the Education Law Center in Newark. Its graduation center for black males is 69%. New Jersey also has a heavily unionized public sector with relatively high wages for public workers of all kinds, including teachers. This and a state supreme court decision mandating increased funding for schools in poor communities raises the cost per pupil to $17,794, the highest in the nation, after Washington D.C. New York is at $16,981. California, and Illinois spend $11,000. The average New Jersey teacher makes $61,277 a year, well above the U.S. average of $52,800, according to the National Education Association. Medical and other benefits add $19,140 according to the teacher's union. And the unsustainability goes back to issues such as unfunded liabilities for benefits and pensions in New Jersey. New Jersey's Treasurer estimates the unfunded liabilities relating to lifetime health benefits for current and retired teachers at $36.32 billion....

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China's State Internet Information Office chief Lu Wei, 54, is a Communist Party official who assumed office in 2013. He attends many of the internet conferences and gatherings in China and overseas, loudly explaining China's Communist Party line that "respect for national sovereignty" on the Internet should be adhered to. Mozur and Perlez reveal the vigorous personality of Lu Wei as he argues for this view of the Web at gatherings, in sharp contrast to the way younger generation social media users and business users see the internet. Lu Wei spent his early years as bureau chief of the state owned Xinhua News Agency in southern Guangxi Province. He was promoted to positions as secretary general and vice bureau chief at agency headquarters, and to vice mayor of Beijing in 2011, chief of the city's propaganda department. He came into prominence following an article in the Communist Party journal "Seeking Truth," after pointing out that China needed to manage the way information about the country and the Party is presented using the new information technologies. He also perceived the risks posed by distorted or incorrect information to financial markets, and economic security. This was confirmed the following year with the rapid spread of reports about a high-speed rail crash in Wenzhou, China, and in numerous other incidents following this, as social media reports that could not be confirmed spread quickly in out of control fashion. He now is the director of a new Central Internet Security and Informatization Leading Group, headed by president Xi Jinping, with the task of coming up with a policy for balancing views of openness needed for the economy with government views on internet oversight. This is not only a political matter, as Chinese officials face the challenge of how to get the public to vent views on critical matters such as public anger about pollution, food contamination, contractors and badly constructed housing in a recent earthquake, mismanagement in the railways ministry, and a whole range of issues related to economic development, health and public safety. ...

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A study group at the Washington Institute for Near East Policy sends a public letter to U.S. president Obama on the Iran negotiations. It says the nuclear agreement negotiated with Iran "may fall short of the administration's own standard of a 'good' agreement." It is signed by some of Mr. Obama's main advisors during the first term. Some of these officials told the NYT that the letter was the result of serious concern that Mr. Kerry and other negotiators were moving towards major concessions that would weaken the international inspections of Iran's facilities, back away from making Iran reveal suspected past work on weapons, and allow Iranian R&D to move ahead with making nuclear fuel once the accord expires. The five Obama advisors from the first term who signed the letter are: Dennis Ross, Middle East negotiator, David Petraeus, CIA director, Robert Einhorn, State Department proliferation expert, Gary Samore, chief advisor on nuclear policy, Gen. James Cartwright, vice chairman Jt. Chiefs of Staff. Gary Samore is president of the advocacy group United Against Nuclear Iran. The letter was also signed by President Bush's national security advisor during his second term, Stephen Hadley. Such a large group of advisors to presidents Bush and Obama familiar with the details of Iran's development of nuclear technology and weapons capabilities could give Republicans support to kill any agreement that falls short on inspections during Congressional Review. On this key factor where only vague assurances are made by the Iranian side- such as signing an International Atomic Agency convention giving inspectors broad rights to visit suspicious sites, followed by Ayatollah Khamanei ruling out military sites- the letter is specific. Inspections it says " must include military (including Islamic Revolutionary Guards Corps), and other sensitive facilities. Iran must not be able to deny or delay timely access to any site anywhere in the country." Inspections work rigorously done is set as a precondition before any significant relief from economic sanctions on Iran....

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Faces in the continuing foreclosure crisis in Spain in 2014 include Xacobo Rodriguez and his mother in Madrid. Foreclosures continued at a high rate in Spain into 2014. The Bank of Spain reports that 38,961 primary residence homes were foreclosed in 2013, a decline of only 1% from 2012. If second residences are included the number of foreclosed house increased by 11% in 2014. This is six years into the housing crisis in Spain with no end in sight. The government has declared a 2 year moratorium on eviction of families that meet hardship criteria- a member of household disabled, expired unemployment benefits, very young children. A Social Housing Fund with 6000 units which provide places to live was created but only a small number of units are given out so far. The social advocacy groups say not enough is being done. The government points out that 90% of houses taken by banks were unoccupied at the time. Bank Association spokesperson says there is an understanding of the depth of the crisis with 6 million people out of work, that action is taken to reduce the stress on homeowners. And point to the data showing only 1% of homes were taken by banks in 2013 of the 6 million home mortages outstanding, with one third of these done with an agreement to have debts erased for the homeowners. Women and immigrants are affected to a larger degree, according to Human Rights Watch. Social housing in Spain is only about 2% of the housing stock making things more difficult, by comparison it is 17% in France, 21% in the UK, 35% in the Netherlands, according to Human Rights Watch. Meanwhile the Spanish government of the Partido Popular under Mr Rajoy, continues a policy of trying to be responsive to the homeowner crisis, and at the same time helping the banking system recover following a $56 billion bailout loan taken by Spain from the European Union. ...

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Renewed warnings about the bubble in housing prices in China. Earlier warnings came from Krugman, Lardy, John Taylor. This one comes from Nomura economists Zhiwei Zhang and Wendy Chen. Could the government's action to curb rising housing prices not be adequate leading to a financial crisis as early as 2014, is the question posed by Zhang and Chen. They cite the rise of housing prices by 84% from 2001 to 2006, before the financial crisis of 2008 in the U.S., using the Case-Shiller housing price index. One problem- the government statistics may have underestimated the extent of the bubble. China's official index shows housing prices rising 113% in major cities from 2004 to 2012. Zhang and Chen say this is much smaller than the actual rise because it includes older, lower quality housing property. They cite an academic paper that adjusts for this and finds prices jumping by 250% in the period 2004 to 2009. Another problem is that China's housing prices growth slows after government action but then resumes the growth, leaving the risk exposure at the high level as before. Because the local governments are tied up in the housing bubble the problem would hit the banking system. About 14.1% of the outstanding bank loans are to local government financing vehicles, and 6.2% to property developers, according to Nomura economists. The declining potential growth rate in China means there is less room for bad loans to be absorbed by hyper growth levels than in the past. Errors in policy can magnify the risk including loosening monetary policy and exacerbating the bubble at the wrong time. In the absence of errors the risks still remain requiring the sale of public assets to bail out local governments and banks. The argument made by Krugman and other economists has been that China is not immune to the risks of a housing bubble going bad, in any way less than Sweden, the U.S., Spain and other countries, requiring bailouts of banks....

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House members frustrated and angryover high unemploymet and the rescue of Wall Street that is doing little for americans who are losing jobs and shrinking small business, traded insults with Secretary Geithner and some called for hime to quit. A measure calling for for Congression Government Accountability Office to conduct audits of the Fed that includes interest rates and lending to individual banks that was proposed by Ron Paul was passed 43-26 by the House Financial Services Committee. At one point a Hopuse Republican told Geithner "the public has lost all confidence in your ability to do the job." And Geithner shot back with "what I can't take responsibility for is the legacy of crises you've bequeathed this country." Rep. Fazio (Dem. Oregon) was one of the voices calling for Geithner's resignation and said in an interview that Mr. Geithner is too close to Wall Street: "Quite frankly, all the gamblig on Wall Street is doing nothing to put people back to work in America and rebuild our economy." Geithner is coming in for criticism for the rescue of AIG that indirectly rescued Goldman Sachs. Congressman Ron Paul is the author of a best selling book "End the Fed." Mr Paul says his amendment would not hinder the Fed pusuing an independent monetary policy. What he is concerned about is that "ther's plenty of political influence goig on now- presidential politics, influence by Goldman Sachs and the banking industry, and its all done in secret." See the links to Geithner and contacts with the banking industry. It was in 1978 that a law was passed shielding the Fed from Congressional auditors reviewing the Fed's monetary policy operations, loans to foreign governmets and direct lending to banks. The Fed isn't disclosig interest rate deliberations and only agreed to do this with a5 year lag in the 1990's and Ron Paul/s proposal would reduce this time lag to 6 months for the GAO access to this information....

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What Peter Bernstein, 90, remembers about the Great Depression. He says one was conscious of it evertime you walked outside on the stree, and people looked so threadbare. A mass of policy errors made the situation worse. And life was different then, more like a developing country as the USA went through the throes of urbanization and industrialization. Food took up about a quarter of disposable income compared to one tenth today. About 20% of the jobs were in agriculture in 1930, compared to 2% today. Less than half of the jobs were in service industries in 1930 compared to 75% today. And there were no food stamps, no unemployment insurance, no social security, no medicaid and medicare, none of the automatic income things that maintain income in the USA today for people out of work. Economist Robert Solow, 90, remembers growing up in Brooklyn, New York, and how his parents constantly worried about the next month's money. Paul Samuelson, another economist, 93, remembers attending classes at the University of Chicago during the depression years. And he says the economics lecures were on laissez-faire principles, which stopped making sense when he looked out the windows and from what he saw and heard on the street. Showing how out of touch policies were in the early years when the depression's worst chartacteristics took shape. However we are in the early stages of this, and it can still be very painful as people make it through the storms ahead. What will things look like as the nations unemployment rate hits 10% by 2010,? Which means things are much much worse in parts of the country like the midwest, where industries like the automobile industry depend on sales of vehicles which have seen sales go down from 15 million vehicles down to 9 million annualized in 2009, and may see further declines in 2010....

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The economist argues that home ownership is not benficial as social policy as it was made out to be. People in negative equity, or holding subprime mortgages, or people in foreclosure with blighted neighborhoods and acceleration in falling prices, and the lack of mobility that comes with home ownership in states that have high home ownership, and disappearing wealth with falling prices, make it a poor tool of social policy and a failed way of accumulating wealth. Experts say that one in four recesssions are caused by housing market collapse, and these recessions take longer to heal. The heavy borrowing against home equity of $9 trillion between 1997 and 2006- equal to more than 90% of disposable income- also makes this inr reality a way of adding debt not of accumulating wealth, as the wealth has an illusory aspect when prices are pushed up by the constant trading of homes as investments setting up a bubble phenomena, and renters who do not have what it takes to own a home are pushed into home ownership. About 10 million homeowners have negative equity in their homes. The value of American homeowners equity has dropped from the peak of $12.5 trillion in 2005 to just $8.5 trillion at the end of 2008. All that $9 trillion in debt is piled up against illusory gains in wealth based on transitory house price jumps. These numbers suggest that the $9 trillion in debt from borrowing aginst home equity is more than the entire value of homeowner equity in the USA, meaning if Americans had aliquid market and sold all their homes today they could not pay off the debt generated from home equity borrowing during the bubble years. Worse still cutbacks in consumption are severe in such situations, and this situation weakens banks balance sheets as foreclosures increase, creating a vicious cycle and downward trend as investment and employment are also hit hard, one that is hard to break....

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The party congress of the Communist party does not look like its going to lead to any changes in the system, only to make sure it runs better by getting public input through pollsters on public officials, and on web sites on new legislation. The pollster, including a firm, Horizon Group, describes his role as working out a mechanism for people to express themselves as there is very real frustration in society. Websites airing public opinion helped introduce nondiscriminatory clauses in the new employment legislation. But otherwise there is actually a tightening of the control of dissent, as the party is worried that once it starts it will get out of control and jeopardize the economic progress However this leaves the future quite uncertain as there is still not enough room for airing the very real frustrations and concerns such as for the environment, health and services, the prevailing corruption, and the problems in the countryside of the poorer regions in the interior of the country. These concerns are being pushed into the future. For instance without a free press its hard to air corruption cases, as in India. Only two of the several thousand petitions under the system of letters and complaints xinfang are resolved. About 12 million are received each year by the government. Because of the obsession with tight control many activists end up in prison even though the causes such as the environment are popular. Like the activist who called attention to the Lake Tai pollution, and the rural blind activist mentioned who argued on behalf of women that were forced into late term abortions. Here the government actually stepped in to announce plans to cleanup Lake Tai, but the system continues its inexorable push to drive out any dissent even if it does not relate to political issues. This may be one of the severe distortions of the present system. ...

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The situation today of the London and the Thames Valey region's economy and the economy of the areas surrounding it in the south. Its history,downturns in periods after the dotcom crash in 2000-2005 and the current expected downturn after the US subprime crisis, and the expected deterioration in the housing market here. As well as problems for the financial institutions in a tightening credit market with London's position as a key centre of international finance impacting the economy the most. Regional diffeernces in the current upturn London's output per person grew to 136 vs decline in output per person in Scotland Wales and the North, a 36% improvement in London vs deterioration elsehwere in the north and in Wales. With Newcastle in the north hit by the Northern Rock mortgage lender's collapse adding to the difficulties from a general decline in manufacturing. A general decline in industry in the north and the rest of the country outside the Thames valley region shows up in the numbers. From 2000 to 2004 according to official estimates, manufacturing declined from 17.9% to 14.1% and financial services around London expanded from 5.5% to 8.3%, and by 2006 to 9.4%. With a contribution of one tenth of the economy financial services account for 30% of overall GDP growth in the last 3 years and 30% of all corporation tax revenues which helped the Labor government finance its public sector improvements and infrastructure improvements. The current downturn will also lead to a sharp drop in immigration to Britain. Growth is expected to slow to 1.4% in London and in the rest of the country in 2008 which is lower than the 2% growth in London region in the period 2000-2005 when the last downturn in London occurred. The financial services industry spills out benefits to other regions and the rest of the country which is how the British economy has done well even with the lack of strong manufacturing, weak exports and strong currency. ...