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The deal for buyout of Alitalia by Air France-KLM values Alitalia at0.10 euros a share about 80% below its closing share price of 0.53 euros per share last week. Air France-KLM will give one of its shares for 160 shares of Al Italia and will take on the airlines 1.3 billion euros in debt and losses of a millon euros a day. This values Alitalia at 139 million euros. The Italian Government has put in 4.3 billion euros in the last 5 years to keep Alitalia running till the European Comission ruled out any further help. Alitalia's market share in Italy has dropped to discount airlines like Air One Easyjet and Ryanairdropping from 80% to 30% in the last ten years. The new deal will drop Milan's airport considered to be one of the worst in Europe as a hub and use the airport in Rome ast he third hub after Paris and Amsterdam. It will also retain the Alitalia name. The fire sale of Al Italia shows how the new economic climate is affecting Europe and how a recession in the US could affect the market. At the time Al Italia was also running out of cash with only 282 million euros of cash left at the end of Jan 2008....

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50% of European CFO's surveyed by CFO magazine and 60% of Asian CFO's think the dollar decline is permanent devaluation compared to a third of US CFO's. The Commerce Dept figures show January exports 16.6% higher than a year earlier, and the trade deficit down by 7% in 2007 vs 2006 which will accelerae in 2008 with the larger dollar decline. As long as European and Asian economies continue to grow a bit slowly but not in a recession like the US the positive effect of growing exports should continue. So far for the last 6 quarters according to the WSJ exports have contributed 1 percentage point on average to economic growth measured at annual rate while the housing slump has subtracted just over one percentage point on average. So this is no small feat for exports and it has helped make the economy more resilient to the shocks of housing and oil price. As long as the growth overseas is not affected to a great extent by the economic slowdown in the US exports can continue to play this role. As the housing crisis is primarily a US and UK phenomenon this should not seruiously damage the economies of Asia and Europe and their ability to take in US exports....

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Everything is moving in the wrong direction in terms of sustaining growth according to Nicholas Lardy of the Peterson Institute of International Economics. China's exports dependent economy will see a serious downturn as export markets in the USA and Europe dry up in 2009 as the deep recession takes shape. This could lead to growth rates going down to 6-7%.Other areas that propelled Chinese growth areinfrastructure investment and housing construction. Worried about rising housing prices the government last year out in place measures to dampen housing purchases, with tighter restrictions on second mortgages by banks and tighter lending for first mortgages. With house prices flat or falling now in Chinese cities many buyers are holding off for a better price in the future. Slower growth in housing will mean less demand for migrant labor and less demand for imports of cement and steel from other countries. China's lower imports of machinery, machine tools and heavy equipment for industry and infrastructure building will affect especially the German and Japanese economies. Germany has become the world's largest exporting nation in part by selling industrial equipment to China, its second most important market for machinery. In the first 7 months of 2008 these exports were still expanding at 20%. But these exports are likley now expanding at a rate of 10% and may slip to single digit growth in 2009, according to Olaf Wortmann, an economist with the VDMA engineering association. A good example of what is happening is the German manufacturers of textile machinery which derive 95% of their sales from overseas and mostly from China. These orders were down 42% in the first 7 months of 2008. With declining consumer demand in the US demand from China's exporting factories is declining. These figures and the accelerating slowdown in the US consumer markets suggest there will be a serious downturn in Chinese exports of textiles and other goods. The impact on German growth rates which are going below 2% in 2008 is to lead to 0% or declining growth in 2009. A similiar situation is ocurring for imports of heavy equipment from Japan. Orders of Japanese machine tools by China declined by 25% in September according to the Japan Machine Tool Builder's Association and Komatsu's shares have declined by 70% since their June peak. Part of the Chinese impact on global growth is mitigated by the fact that at market exchange rates China's economy is still only 6% of the world economy at market exchange rates and 10% at purchasing power parity. Chinese domestic consumer demand is $1.2 trillion for 2007 compared to the USA's $9.7 trillion, which also suggests how heavily China was dependent on the American consumer and how the missing American consumer will be hard to replace and the growth rates of 10-12% may be a thing of the past, with 6-7% being more realistic. ...

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Katana Summit, awindtower manufacturer in Columbus, Nebraska, laysoff employees after acancellation of an order for 225 windtowers.

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David Filipov of the Washington Post visits Sochi, site of the 2014 WInter Olympics, three years later to find a city that is bustling even in winter. Before the Olympics Sochi was popular destination for tourists. In 2016 and in 2017 about 6.5 million people visited this city on the Black Sea coastline. With the new facilities built during the Olympics Sochi has become a year round destination. Russian tourists visiting Turkey and Egypt find Sochi an attractive alternative after the road and rail links built into the mountains. Officially sponsored events are giving Sochi more popularity. During the Olympics the estimated $50 billion cost of building facilities was criticized for delays and cost overruns. The better management during the post-Olympic period is showing Sochi has a future as a popular tourist destination.

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Average age of American cars increases to 11.3 in 2013, according to IHS Insight.

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Russia's national airline, Aeroflot, has goen through a transformation by improving safety and inflight service through a rigorous program of training for pilots and inflight service personnel by 2015. It is 51 percent state owned. Aeroflot has the advantage of the Moscow hub which cuts passenger travel time to distant destinations by 2 hours compared to Dubai hub of Emirates airlines. A flight New York to Shanghai is shorter by 2 hours for Chinese travellers. The Moscow- Rome flight is 80 percent filled by Chinese passengers for example. Passenger volume is up 10.3 percent in the first 9 months of the year, even as air travel in Russia was down 3.4 percent in Russia, according to Aeroflot and transport ministry. One advantage enjoyed by Aeroflot is its very young fleet of planes, with age of 4.3 years on average in 2014, compared to Delta at 17 years and British Airways at 12.6. It has 118 Airbuses and 25 Boeings, and has added 21 locally made Sukhoi Superjets to support the local aircraft maker. ...

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Aeroflot is listed on the London stock exchange. It is going through a makeover by ordering Boeing and Airbus planes to become profitable, because the older Russian made Tu-154 planes were costly to operate with higher fuel consumption. The Sukhoi Superjets are being built in partnership with Boeing. Kramer says the aircraft industry operates on long timelines so that the lack of local aircraft comparable to Embraer of Brazil and Bombardier of Canada is more a reflection of the situation in the 1990's than of today. Newer aircraft are planned for the next decade for smaller midrange planes. In the meantime Aeroflot is selling all of its Tupolev aircraft and plans to layoff 6000 workers during the transition to profitability. Till 2009 Aeroflot was run by Yeltsin's son-in-law, as were many other companies managed by Yeltsin's inner circle during that period. Following changes made by Putin in 2009, a new CEO was appointed to better manage the transition of the airline into a national and global carrier....

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With a 6% decline in sales in Europe expected for 2012, the problems at GM's Opel operations are expected to worsen. GM's sales in Europe declined by 2% in 2011. Critics say GM has not give enough attention to Opel's operations. Giving it only an afterthought after being overwhelmed by problems in the U.S. operations, and mostly using the design expertise of its engineering center in Russelheim, near Frankfurt. The Buick Regal is based on the Opel Insignia and the work of Opel engineers. Ferdinand Duddenhoffer, professor at the University of Duisburg-Essen, Germany, says GM has neglected Opel and is not making good use of the manufacturing capacity at Opel. The problem, he says is production management and being able to shift quickly to different models based on demand, and using Opel as part of a global factory network. The repeated restructurings at Opel for 15 years have left this problem unresolved. In his view GM is still in the Middle Ages in this respect.

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John Taylor, a professor of economics at Stanford, points out that the numbers being thrown back and forth in the budget debate can be confusing. He suggests a better way to look at this. The U.S. budget was 20% of GDP in 2007, and has been at or below that level in recent years, before the higher spending to counteract the effects of the 2008 financial crisis. As the economy recovers and private investment increases it makes sense to bring the spending back to levels where it has been- spending levels that do not endanger the country's credit rating and are a prudent way to manage the nation's finances. Taylor asks the question- if the U.S. got by by spending 20% of GDP in 2007, then why is it not possible to do this in future years when the GDP will be higher. In 2000 spending was actually 18.2% of GDP. Taylor says that with higher incomes people will be moving into higher tax brackets which should increase revenues in future years. In three years since 2009 the spending levels are up to 24.4%. Under this scenario private investment would make up for lower government spending and debt, leading to higher employment and GDP as business confidence rises. ...

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Black people reflect on the Obama presidency and what it means to them during the last year of the presidency.

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About 15% of black men of working age in the population, and 21% of black women, were employed in the U.S. public sector, according to the population survey. The Labor Department reports 500,000 jobs in the public sector were lost since 2007. This reverses an historical trend of resilience in jobs for the public sector during economic downturns. If population increase since 2007 is figured in there are even fewer jobs considering more jobs might have been added, with estimates as high as 1.8 million. This is bad for black people in the U.S. because many work in public sector jobs driving school buses, in the post office, in the police and in other public services, with black people being 30% more likely than whites to hold a public sector job, and twice that of Hispanics. Thic comes at a time when the black community has seen a devastating impact from the foreclosures and other economic damage that followed the 2008 financial crisis. The result is shown in a study of foreclosures for 2005-2009 at Cornell University showing mostly black and Latino neighborhoods were affected by foreclosures at three times the rates for white neighborhoods. According to Pew Research Center the median white family had net assets of $142,000 compared to $11,000 for the median black family. With median black household income at 60% of that of white households the gap keeps increasing especially with high unemployment in black neighborhoods....

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U.S. bank Wells Fargo is paying $175 million in a settlement with the Justice Department for "systemic discrimination" in mortgage lending to Blacks and Hispanics. The lawsuit was originally filed by the city of Baltimore over violations of fair lending laws. The Justice Department started its own investigation following the lawsuit. The Justice Department said 4500 black and Hispanic homeowners in the Baltimore and Washington region were targets of loans at unfavorable rates and excessie fees. Federal officials described this as a pattern of unfair lending practices that spanned 36 states and 34,000 minority customers over 5 years. As part of the settlement Wells Fargo is providing $50 million to Washington, Baltimore and six other metropolitan regions to help residents make down payments on new homes. Separately Wells Fargo in its settlement with the city of Baltimore, will provide $3 million in homeowner assistance to residents, and make $125 million in lower cost loans to low and moderate income people for the next 5 years....

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Andrew Jacobs provides this exceptional account of the tense atmosphere in Brazil, and the split between supporters of the government and the opposition, in April 2016 with the impeachment effort against president Rousseff.