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The Commerce Department report shows GDP growth of 0.7% annual rate for first quarter 2017, down from 2.1% the prior quarter. Sharp drop in consumption with weaker retail sales, to 0.3% caused the slowdown. It was also attributed to seasonal factors. with a warm winter reducing energy spending. Expectations did not keep up with the hard data on spending. A Trump bump is expected with growth in the range of 2% for the rest of the year.

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BW's report says Housing will go back to normal by 2012. This is a better case scenario. But there are serious downside risks and unknowns. A study done by Rogoff and Reinhart shows that it takes about 6 years or longer before things return to normal after a serious crisis. This could mean 2012 is the earliest things could return to normal. And this assumes that housing demand remains at about 1.5 million homes a year as in the past, and with only about half a million homes being built now as developers scale back the difference of 1 million homes would cut into the inventory to bring demand and supply back into balance. But changing demographics with an aging population and different needs, new frugality with buyers renting for longer, and the perception that homes are not a investment, slowing immigration, all factors that could change the nature of the market and demand in housing, could lead to things dragging out for longer. BW has assumed a more optimistic level of GDP numbers from Moody's Economy.com estimates made in May 2009, with GDP declining 3% in 2009, growing 1.4% in 2010, 4.7% in 2011, and 5.8% in 2012. These estimates are on soft ground because no one really knows for sure what will happen in anumber of areas in the years ahead. In terms of deflation and inflation in the years ahead, capacity utilization is at 68% but a look at the declines in manufacturing show that some of it will be a permanent loss as in the auto manufacturing base, export markets depend on how economies in Asia and other countries are performing, a new frugality and different consumer behaviour because of debt levels at 100% of GDP could permanently lower demand to levels different from that in the past. The regional nature of the recovery in housing will still be very much present, as areas with surging population growth and areas where housing price rises were modest, from Nashville to Austin, do a lot better than California and Florida....

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The top three books in Vanguard's recommended reading list for serious investors say its not more profitable to get into complex investments and strategies- simple investment approaches of putting money in Vanguard core funds or mutual funds of Vanguard and Fidelity are more likely to produce good performance. 2013 was another year in which this proved to be true, and to a remarkable degree. Hedge funds and complex strategies did worse than investing in broad index funds that produced about 29% in returns similiar to the rise in the broad market averages. Malkiel and Ellis suggest the simple approach in Elements of Investing. Swensen in Conventional Investing, and Bernstein in Four Pillars of Investing provide evidence of the wisdom of such an approach for serious investors. All four authors are financial experts who have followed the stock markets for six decades since 1950.

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BJP led by prime minister Narendra Modi wins a huge majority of 325 seats out of 405 in India's largest state Uttar Pradesh for the state assembly elections. The national opposition party Congress wins only 7 seats in what was once the main source of Congress support during the period of Jawaharlal Nehru and Indira Gandhi. This will enable the BJP to push forward with the modernization program for infrastructure and roads, and other development. Opposition in the upper house Rajya Sabha and lack of support from states will not be a major hurdle in development now that BJP has won in states such as Orissa, Maharashtra, Uttar Pradesh, and Uttarkhand in recent state elections after its win in the 2014 national parliamentary election. This also gives credibility to the government's other efforts such as demonetisation to fight corruption in real estate and other areas. India's GDP is a fraction of China's and it is smaller than that of countries such as Indonesia, because of the poor administration and lack of development in India's 2 largest states of Uttar Pradesh and Bihar in the northern Hindi speaking region. To double the GDP from its current level will require doubling the GDP of Uttar Pradesh and Bihar. Bihar's state government is run by a former BJP leader, who has also pushed for improving standards of living and economic growth.  ...

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Cold weather dampened U.S. economic growth in the 4th quarter, with the initial reading of 3.2% seasonally adjusted annual growth in GDP revised to a reading of 2.4% by the Commerce Department. Projections by economists are for even lower growth of 2% in the 1st quarter from the cold weather, which was the worst in 35 years for some parts of the north and midwestern U.S. Consumer spending adjusted for inflation increased by 2.6%, and the savings rate dropped by one percentage point from the average of the last 3 years to 4.5%. Government spending and investment declined by 12.8%, as efforts to reduce the deficit continued. Offsetting this, and the bright spot here was more business investment on equipment, software and buldings of 7.3%, and exports up by 9.4%. GDP in the 4th quarter was up 2.5% from the prior year and unemployment rate was 6.6% in Jan 2014. Overall assessment was cautiously optimistic for the U.S. economy at the beginning of the sixth year following the global financial crisis of 2008....

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The effort to shift China's economc growth away from the rampant overbuilding in housing and industrial capacity of the past to domestic consumption, and focus on meeting the demand for better medical care, quality of food, education and other quality of life products. China's leaders met at the Central Economic Work Conference in Beijing in Dec. 2015 to work out ways to make this shift so that growth rate of 6.5% and other goals can be met. Plans include reducing industrial overcapacity, dealing with overinvestment and unused inventory in housing, reducing financial risks from high corporate debt to GDP ratio approaching 160% estimated by Standard and Poors Ratings Services. By comparison the U.S. debt to GDP ratio is 70%. A steep rise resulted from the huge China stimulus program of 2008-2009, when the ratio was 98% for China. Experts such as Derek Scissors of the American Enterprise Institute are pessimistic about the prospects of successfully implementing reforms, saying reducing industrial overcapacity was a goal of the new Jinping Li-Keqiang leadership in 2013, but not much progress has been made in 2 years....

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Airbus CEO Fabrice Bregier, says Airbus is set to double its profit margin by 2015 through improvements in efficiency and management. In 2012 EADS Airbus unit showed an operating profit margin of about 4% on sales of 39 billon euros, compared to Boeing commercial airplane division operating margin of 9.6% on sales of $49 billion. Under the 51 year old French engineer Airbus is redoing the way it makes planes, giving factory managers more freedom to make decisions, and bringing an "entrepreneurial spirit" to the company. Each plant is treated as a small business, and Bregier says the fact that the planes are complex does not mean that one needs to be complex in doing things. Airbus parent company EADS stock has risen by 50% in the past year with shares at 42.84 euros on June 14, 2013. The reduced stakes of the French government and Daimler AG in EADS has increased the amount of freely traded shares to 72% from 54%, increasing pressure from investors for better performance. Airbus has 150,000 employees and subcontractors and changing the culture in the organization is a difficult task. Bregier was chief operating officer for 5 years before assuming the CEO position in June 2012. ...

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Daisy Maxey of the WSJ talks to 3 financial advisers during Dec. 2014 about how investors should approach stock market volatility, the U.S. Federal Reserve's plan to raise interest rates, and tax issues in 2015. The advisers say investors should not let the volatility affect a steady long term investing strategy. Joel Isaacson says he prefers high-dividend paying stocks over the 10 year U.S.Treasury bonds because of the lack of much upside in bonds. He adds that taking extra risks on high yield bonds is not warranted. The advisers refer to opportunities in areas which are not doing well in 2014 such as in Europe. On tax issues having some money in Roth IRA's is suggested, to have money in tax deferred as well as tax free accounts. Annuities depend on individual situations.

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A heat wave over northern India with New Delhi recording temperatures never seen of over 50 degrees centigrade happens just as voters go to the polling places in May 2024. Results will be announced June 5 for parliament's 543 seats. Turnout is considered to be resilient in the face of the heat wave with only 20% of the voting seats having lower numbers of voters than 2019. The drop in voting was slight of 1.5 percentage points overall from 67.2% to 65.6%. The last phase starts June 1, and 485 seats have voting completed.This vote is all about development and delivery of infrastructure, jobs, and modernization, improving governance and rapidly developing the country held back for about six decades after independence during which Japan recovered from the war, and China rapidly modernized its economy, and India only setting the beginnings of recovery in the administration since 2014, with prime minister Modi setting the goal of a modernized country by 2047 or Vikshit Bharat. ...

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England play Croatia and Scotland play Brazil in World Cup draw. DJT is awarded the FIFA Peace Prize.

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Giorgio Armani and other designer labels and the design industry in Milan in 2012-2013.

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The EU statistics agency Eurostat reported that the eurozone countries GDP declined by 0.3% in the 4th quarter compared to the third quarter of 2011. The decline for Germany was 0.2%. For Italy the decline was 0.7% over the prior quarter according to Istat, the Italian statistics agency. Spain 0.3% decline over the prior quarter. France experienced 0.2% growth over the prior quarter with larger exports by Airbus and more business investment. Italy plans cuts to military spending reducing aircraft purchases, buying 90 instead of 131 Lockheed F-35 fighter jets. Only France and Slovakia showed quarterly growth.

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Rising bond yields for the bonds of Germany, USA and Spain are seen for 2011. The absence of solutions for deficit reduction after the passing of Bush tax cuts in the US, and the debt crisis in Europe, create a situation with the potential for sovereign shocks in 2011.

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The U.S. Justice Department opens an investigation of the largest airlines, Delta, American, United Continental, and Southwest for collusion in limiting expansion. The major 4 airlines control 80% of the domestic airline seats in the U.S. The 3 major airlines have grown slowly compared to Southwest in recent years. JetBlue and Spirit are also growing faster. Southwest plans to expand by 7% in the 4th quarter. U.S. airline domestic seats show slow growth since 2010, with growth picking up in 2015 over the prior year to 3.5% in 2015, according to Innovata. For 2013 and 2014 <0.5% growth in seats, in 2012 decline of <1%, 2011 growth of less than 1%, and slight decline in 2010. During the crisis 2008-2009 airlines cut seat capacity. Price increases have averaged 5% increase from 2007 to 2014 to $391, adjusted for inflation for domestic seats. The U.S. Justice Department investigation will look at "possible unlawful coordination."

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Rapid growth in SUV sales in China in 2011-2014. SUV sales increased by 49% in 2013 over 2012.

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China's premier, Wen Jiabao, opened the National People's Congress, annual meeting of the Chinese parliament, by saying that China had lowered its growth rate to 7.5% from 8%. GDP growth for 2011 was 9.2%. Wen set an inflation target of 4%. The CPI index increased by 5.4% in 2011. Wen set 14% growth target for M2, China's broadest measure of money supply.

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Life expectancy was growing in the U.S. till 2010. In the three years 2015 to 2017 it declined each year. In 2014 the life expectancy in the U.S. was 78.9 years, declining to 78.6 years today. This is contrary to the trend in all G-7 countries where life expectancy is growing. Now it is seen as systemic- a factor common to all race, gender and ethnic groups. Part of this is a result of economic distress. People with less education are more affected and young people are also hit hard.

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Ford's plans for expansion at its manufacturing location in Chongqing, China, in 2012, will make this its largest manufacturing base outside of Michigan. An investment of $600 million for plant expansion will increase production capacity in Chongqing to 770,000 in 2014, from 350,000 today. The project has received government approval. Ford plans to introduce 15 new models in China by 2015, including a redesigned Ford Focus, which the Chongqing plant began producing in 2012. Ford plans to double the number of dealers by 2015 from 400 today. Ford sold 519,000 vehicles in China for 2011, a 7% growth from 2010. The market saw astounding growth of 46% and 32% in 2009 and 2010, but is rapidly decelerating with only 2% growth in 2012. Total sales in China were 18 million vehicles in 2011, making it the largest automobile market in the world.

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This editorial in the Economist says Britain's economic recovery will not be complete until interest rates are well above zero and productivity growth is established. Without productivity growth and growth in wages, both lacking in the economic recovery since 2009, tax revenues will not be enough to reduce the deficit, requiring more spending cuts. That means the Bank of England will not raise interest rates, keeping a situation of no rate changes prevailing since March 2009 when the central bank cut rates by 0.5%. In the current situation the Bank of England is not expected to raise rates till 2016, only after the U.S. Federal Reserve increases rates to avoid appreciation in the pound and further deflationary pressure, according to Goldman Sachs. With inflation currently at zero, following the drop in oil prices, and 10% appreciation in the pound since mid 2013 making imports cheaper, there is little pressure to increase interest rates. In 2011 inflation with rising food and energy prices reached 5.2% , but the Bank of England did not raise rates because of the eurozone economic crisis affecting growth. Only since 2013 has economic growth picked up with 1.2 million jobs created since the beginning of 2013, bringing unemployment down from a high of 8.5% in 2011 to 5.6% in May 2015. Throughout the recovery productivity growth is falling behind- 2014 productivity measured by output per hour worked was 1.3% lower than in 2011, and 14% below the pre-crisis trend, according to the Economist....

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The president of the Pew Research Center, Andrew Kohut, says Romney was an especially weak candidate for Republicans and this has to be taken into account in understanding the results of the 2012 U.S. presidential election. Romney failed when it came to establishing empathy with voters compared with Obama and this was a significant factor- 53% to 43% for Romney in exit polls. Even on the economy which should have been a Republican strong point Romney failed to get an advantage over the president with both tied at 48% to 49% for Romney. Republicans were favored in their approach to government- only 43% favored activist government in 2012 compared to 52% in 2008, and 49% disapproved of the Obama health care law and only 44% approving in 2012. On social issues exit polls showed 59% believe abortion should be made legal, and on immigration 65% support a pathway to citizenship for illegal immigrants. Early in the primaries some commentators said the Republicans were not fielding strong candidates for president who could relate to voters and this has turned out to be true. This also explains the Republicans retaining a majority in the House of Representatives and continuing the hold on governorships. ...