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In Spain regional governments finance the costs of education, health care, more than elsewhere in Europe. Analysts in Spain say the spending went out of control during the boom years of the last decade. Governments from Catalonia, Valencia to Andalusia spent lavishly in these years on everything from stadiums to theme parks and hired many public employees. Regional revenues have gone down by 9% in the last 2 years and local governments in Spain are now trying to raise $57 billon in the debt markets, more than any other local governments in Europe, except for Germany. And regional governments like the government in Catalonia are paying 3.3%, one percentage point above what the Spanish government is paying. Spain's local governments have $200 billion in debt, and more spending cuts are expected as tax revenues continue to fall short. Spain's economy is expected to decline by 0.3% in 2010.

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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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A black supporter of Obama, Ms. Hart, tells him- " I'm exhausted of defending you, defending your administration. I've been told that I voted for a man who was going to change things in a meaningful way for the middle class." This encounter happened at an hour long town hall meeting on CNBC, which John Harwood moderated. Harwood asked Obama whether he was having difficulty connecting with average Americans because of attending Ivy League schools and spending part of his youth overseas. The incident reflects the frustration and disappointment felt by average Americans with the Obama administration and with Obama.

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The U.S. trade deficit widened sharply in March from February 2015, increasing by 43.1%, after the ending of a labor dispute at West coast ports. The deficit widened to $51.37 billion. This is more than expected from a strong dollar. This could make 1st quarter GDP figures show a contraction for the U.S. economy. Products imported from China were up 32%, compared with March 2014. Exports were up only 0.9%. Experts estimate GDP contraction of 0.4%- 0.5% for the 1st quarter 2015. In 2014 a similiar situation happened but growth was up for the rest of the year and experts see this happening again in 2015.

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The median household headed by a person 60-62 years of age with a 401(k) account has less than one fourth of what is needed to maintain a standard of living at retirement, according to data from the Federal Reserve and analyzed by the Center for Retirement Research at Boston College for the Wall Street Journal. Including Social Security and any pensions or other savings, the savings are way short of what is needed for retirement. Households used in this data had a median income of $87,700 in 2009. The 85% needed for a decent standard of living upon retirement is $74,545. Social Security would provide an estimated 40% of pre-retiremment income, or $35,080 for that median family, leaving $39,465 that has to come from other sources. The median 401(k) account has $149,400 which would only provide a fixed income each year of $9,073- only one fourth of the $39,465 needed. To generate that $39,465, households have to have $636,673, and only 8% of American households approaching retirement have that amount. Half of the families have other pension income of $26,500 a year, which added to $9,073 in 401(k) income gets the total income up to $35,573. Other studies using different data by the Employee Benefit Research Institute show results that are largely similiar. The Employee Benefit Research Institute, is supported by 401(k) providers. Its estimate of the median person is based on individuals in the 60's who have worked at the same company for more than 30 years. This data shows an estimated median person having about $158,754, not much different from the Fed data. Why is the amount in most Americans 401(k) savings so low? There was a mistaken sense that a 6% annual contribution, with a 3% company match would be enough. Vanguard Group says the current median amount that people contribute is 9%, counting the employer contribution. Now Vanguard is advising people to contribute more, 12 to 15%, including the employer contribution. Other problems for the low savings is that saving started late, or contributions were suspended after a job loss, or medical emergencies, other debt. The stock market collapses of 2000-2002 and 2007-2009, added to the problems, by wiping out a portion of the savings. The low rate of interest on savings for most of the last decade hurt even conservative investors and lowers the kind of retirement account income used by seniors. The way people are coping with this is to work longer, in some cases into the 70's, cutting down on spending for food, travel, and taking greater risks for higher returns, risks that could make the situation worse....

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The May 6 episode of the stock market plunge of 900 points in the U.S. and then recovering had the effect of rattling investors nerves especially retirees. The impact of this episode is recorded in the experience of one Charles Schwab broker office in Englewood, Colorado. By the end of that day this broker had 50 calls on his answering machine from a fifth of his clients, all seeking to know what happened. Charles Schwab, who helped launch a period of individual investing in the U.S. after 1982 by cutting fees and going after the average investor, (along with others like Jack Bogle of Vanguard Funds), is also on edge. He says he has not seen anything like this since his early days. Schwab confirms Yale Prof. Shiller who says (see link) that his index for markets shows a lot of nervousness. Saying that 98% of people are still very concerned, coming after the May 6 incident, and the Greece and eurozone crisis that impacted US stock markets. One other factor he points out is the constant flow of headlines that suggest certain business people engaged in fradulent practices, something that fuels a lack of trust. Charles Schwab ponders from his office across the San Francisco Bay Bridge, whether words like safety and soundness mean anything anymore. Another factor of concern, Bogle points out, is that institutional investors now own 70% of American corporations, up from 35% in 1975. And the advantage has veered sharply in their direction as institutions, hedge funds, and investment banks trade on their own account, with wealth moving in that direction. This leaves the individual investor and especially the retiree or those about to retire in a severe predicament....

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A report from the U.S. Federal Reserve on the impact of the financial crisis of 2008-2009 on the wealth of American households. Between 2007 and 2010 says the report the median net worth of American families went down by 39%, from $126,400 in 2007 to $77,300 in 2010. This had the result of putting Americans back to the level of net worth in 1992. Much of the loss in net worth was from asset value reductions. The median value of stock market based retirement accounts decreased by 7% to $44,000. The biggest drop was in housing values- falling by 42% to $55,000 in the three years. Americans are working down their debt- a quarter of families are debt free, credit card balances declined 16% to $2600 from $3100 from the period 2007 to 2010 of the report. Yet the median level of family debt remains the same as more families support their kids education by taking out college loans. Median income fell about 8% to $45,800 in 2010, with income losses especially large in the manufacturing industries as the U.S. manufacturing sector worked to improve competitiveness. Other factors supplement this picture. The burden of college loans increased to over $1 trillion for middle and working class families. With the burden of college debt young people were more likely to delay buying first homes, indefinitely dealying recovery in the housing market. Seniors on retirement see interest income from savings negligible with low interest rates and higher risk in a volatile stock market. ...

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It looks likely that after ignoring the chances of the former Iraqi army disappearing in the war and becoming insurgents the Bush administration military has now embraced them in the form of Awakening groups in Anbar province, initially with tribal groups with ageold traditions predating even Islam but now more dangerously in Baghdad itself with former members of the Baathist military. The tribal groups have limited loyalties but are not friendly to the Shiite led government and fight among themselves. But the Baghdad Sunnis who have already suffered from the Shiite led national police and militas are hostile to the Shiite led government. This is why the movement is growing so quickly as the war against the Americans is turning into an effort by Sunnis of all kinds of politics to turn their attention to the eventual conflict that they see with the Shiites. These Awakening Groups are numbering some 65000 and could quickly reach 100,000 and are watched suspiciously by the SHiite led army and police who refuse to integrate them into the army and police making them more likely to look to money from elsewhere once the Americans stop paying them. The Americans for their part are paying them $300 per month which will cost the US military budget some 234 million dollars and save a lot of American lives and give the US already convinced that this is quite possibly a civil war situation not entirely of its own making , an opportunity to have cover for a withdrawal that shows honorable intentions to Sunni and Shiite alike. The American officers clearly say that once they withdraw there won't be anybody to administer the contracts. Would other Sunni countries like the Saudis step in with economic aid. This is a possibility. This may be why some Iraqis are actually now going back home from overseas, adefacto partition is already taking place, And the Awakening groups only provide the safety to Sunnis in their Baghdad neighborhoods. from the Shiite led police and army. Why would'nt the US simply recognize the defacto situation call it partition or anything else, its the defacto situation. Is it because that leaves most of the oil in Shiite or Kurdish areas, Basra and Kirkuk? But in effect thats what the defacto situation is because most of the oil production as figures show is from the South Oil Company in the Shiite south. See the link to the recent article WSJ Dec 13, 2007, on oil production numbers from the South Oil Company and in the north. Of 2.5 million barrels 2 million barrels came from South Oil and 500,000 from the north. Not much of the oil money is going to the Sunni areas anyway and the national government members are not willing to even meet with the Sunni representatives in some areas. From the larger standpoint of oil supply in world markets and oil prices this means that the current increase supply into world markets will see two new phases. For a while there will be good supply as the insurgency settles down to prepare for a sunni led government in sunni areas under cover of US protection and withdrawal because violence against pipelines ect will diminish. The when the US withdraws this production will decline for a period as the sunnis and shiites form their own separate governments. After that as peace settles down on the region in a kind of coexistence of sunni and shiite governments oil production in Iraq will see a modernization and significant increase. As the new Shhite government will need a lot of money to fund reconstruction of its areas Iraq may hav an incentive to really bump up production like the Russians did afterthe Yeltsin chaotic years. Note that of the $2.4 billion oil investment budget for 2007, only 30% of this was spent in 2007 according to the link WSJ Dec 13, 2007, even though the industry is using dilapidated and old equipment and facilities and badly needs investment, so the impact of a real modernization and investment once the country's Shiiites and Sunnis have their own governments and coexist and peace settles in the region would be huge increase in oil supply. In this sense this is why its been so difficult to understand oil prices and supplies. Twisters have been thrown into the works for the Iraq area because of the civil war situaton and for Iran the nuclear situation and the rhetoric simply complicated matters even as Iranian production was declining and its internal demand growing. ...

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Rising wages and rising production costs for Chinese exports of low tech products like shoes, clothing, toys, clothing, furniture, means a lot of these factories will shut down and move to lower wage countries like Vietnam and India or elsewhere. Elimination of rebates on more than 2000 export items raises cost of manufacturing 14-17% according to Guangzhou based American Chamber of Commerce in South China. And the the tough new labor law enforcing worker rights would increase manufacturing costs by 40% according to the Textile Council of Hong Kong. Additional costs would be incurred to meet tougher environmental controls and anti pollution laws and stricter enforcement. As a result of this Adidas wants its suppliers like Taiwan based Apache Footwear with 18000 employees in Guangdong to move as fast as they can to India where it opened a second factory. This process will unfold over several years till India and Vietnam bercome the new sources of cheaper goods because of the large supply of manufacturing labor for lower value added products, as it will take years to build the logistics and infrastructure for these plants in these countries. But because wages will also rise in India and the laws in India are more likely to be enforced than they were in the atmosphere in China where the Communist led government may have turned a blind eye to enforcement and worker rights in the interests of growth, the export of deflation to the west in the way of cheap Chinese products may be a thing of the past. China is doing this as a planned move it appears. Why? On the surface it makes sense that the heavily polluting factories making lower value added products like shoes, clothing, toys, furniture, would not receive rebates from te state and to improve living conditions and promote consumption at home the government woud pass tough new laws to ensure employee benefits and collective bargaining rights, and employee job security. It also reduces trde tensions at a time when the US economy will be in poor shape and jobs lost become a political issue in the 2008 presidential campaign. But there may bigger pressing concern and urgency in these moves after so many years of this being discussed and this may be that China finally may be at a moment when it is confronted with a sober fact that the US consumer is heavily in debt and may not support China's export growth model much longer and with it China faces a really significant slowdown in its growth rate from 11% to maybe half that if China does not develop its own domestic markets for growth. The old foreign investment model may not work anymore. See the link to Ireland where growth is falling off quickly. Higher wages and longer term jobs with benefits would enable a large middle class to develop from this huge manufacturing worker base especially as China moves to more value added products where even higher wages would be paid. This in turn creates a domestic market over time that would insulate China to some extent from the winds that would be blowing from a US economy suffering from a deep recession that may last several years. This may be evident in the words of the Governor of Guangdong when he says that the government is not abandoning the exporters but that selling domestically is good for the country and good for the people. Something deeper is at work here and one would expect an about turn in policy where instead of workers not receiving back wages and lax enforcement that went on freely in the last decade we would see an effort to build the kind of middle class that would provide the market for Chinese goods that would sustain growth at a more modest but sustainable pace. Which means in the short term all those workers at factories that make toys, shoes, clothing and furniture in provinces like Guangdong would be jobless. Some of these factories may move to provinces in the interior like Sichuan and Hunan provinces which may pickup employment. A report by the American Chamber of Commerce in Shanghai written by Booz Allen says that a fifth of the companies surveyed are considering relocating outside China, and that over half of foreign manufacturers surveyed think that mainland China is losing its competitive advantage to places like Vietnam and India....

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Jeff Sommer talks to Harvey Markovitz, considered the founder of portfolio theory, on share prices and the stock market. Markovitz says portfolio selection are the two most important words he wrote and the ones to remember. Building a diversified portfolio is the most important thing in investing. Markovitz says investors should forget about individual stocks and their oscillations, and buy low cost index stock and bond funds. Allocating these in a way that depends on the volatility and risk that the particular investor feels comfortable with. Rebalance the portfolio as needed periodically, and change allocations. Other than that do other hobbies, things that give you a greater sense of reward. Markovitz was deeply influenced by Hume's ideas of skepticism and the thought that one was never sure about the probability of an event occuring even if it had ocurred before.

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In December 2009, the Obama administration assumed an economic recovery was underway. But administration economist Christina Romer was proven wrong in her assessment of the situation. Many of the new jobs added at the time were from temporary surge due to census hiring. The administration lost its focus on unemployment and failed to grasp the economic situation.

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Peter Baker of the New York Times takes a detailed look at Obama and the Presidency in October 2010. He has a long informal interview with President Obama, and uses his knowledge of prior Presidents, to provide a revealing look at Obama's first term in office upto this point. It provides an exceptionally insightful look at the man and his administration, in all its facets, facets that have create both hope and disillusionment. Obama comes across as the cerebral person even in his musings about popular disappointment with the administration, and does not seem connected with the gut-wrenching issues of jobs, foreclosures, the economy, and the economic future as a President needs to be. After all the inspirational rhetoric, Obama, says Baker, did not stay connected to the people who put him in office in the first place. And revealingly Baker shows that even today Obama talks only to a few insiders, compared to Clinton's wider circle, to understand what is happening in the country.

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Eurozone finance ministers meeting in Brussels give Spain one more year to meet deficit targets because of a slumping economy and lower tax receipts after raising taxes. Spain now has till 2014 instead of 2013 to meet the EU's 3% deficit target. Spain can now run a deficit of 6.3% in 2012, down from 8.9% in 2011, without risking EU penalties. The 2013 deficit target is 4.5% of GDP and the 2014 target is 2.8%. Spain can also have $30 billion by the end of July in the event that a Spanish bank needs to be recapitalized quickly.