LyrArc Article Gist
The Bank of International Settlements warns that China's "credit to GDP gap" is 30.1. A figure of 10 normally is considered to be high and needs watching. The People's Daily carried an article presumably by president Xi Jinping warning about the consequences of the debt that had been growing "like a tree in the air." The debt to GDP ratio was at 255% at the end of 2015, and is up 107% since 2008 when the financial crisis led to a huge stimulus that has accelerated debt growth. The corporate debt is at 171% of GDP. The article in the People's Daily warned about reflexive stimulus every time growth slows and said that China cannot any longer "force economic growth by levering up." Cross border liabilities is one area of progress falling by a third to $698 billion, as companies cut debt quickly before the U.S. Federal Reserve raises rates. In the future China is more likely to roll over debt as Japan had done following its debt surge and bad debt with zombie companies, which would in turn lead to lower growth. In the past the government was able to absorb the growing debt because it was not as high as it is today, and the economy was growing rapidly. This is no longer the situation, the reason for alarm at the situation facing China. A spike in interest rates of 250 basis points is cited as one situation which could affect China adversely. ...

LyrArc Article Gist
Ford plans to reduce the weight of its F-150 pickup truck by about 700 pounds, a 15% reduction in weight, by switching parts of the body from steel to aluminium. The new F-150 pickup truck is designed to be introduced in 2014 and capable of meeting new fuel efficiency standards through 2020. This would enable a 25% increase in fuel efficiency and help meet the Obama administration fuel efficiency standards of 2011, which require the U.S. vehicle fleet to average 54.5 miles per gallon by 2025.

LyrArc Article Gist
Light in our galaxy The Milky Way travels at a speed of 300,000 kilometres a second so that light from the moon reaches us in less than 2 seconds. There are other distances we cannot even comprehend such as it taking thousands years for light to travel from distant stars in the Milky Way to earth. And even these distant stars have contributed to life on earth say scientists. During this strange pandemic where virus can mutate and can infect 18 million in the U.S. alone and about which so little is known, this idea of the planets and stars and time puts everything in perspective. Here DW.com talks to a British astronomer who studied at University College, London and Imperial College. Giles Sparrow is the author of "The History of the Universe in 21 Stars." Giles Sparrow tells us there are 200 billion stars, think of that for a moment!  Sparrow says 61 Cygni is an obscure star in the constellation of a swan. Astronomers with today's telescopes, itself something recent, have figured out the distance. Why are stars not shifting their positions as the earth moves around the sun? The reason is that stars are so far away we can only imagine these distances, or maybe not even able to imagine. ...

LyrArc Article Gist
See these awesome pictures of the starry skies and the rendezvous between Jupiter and Saturn as seen from earth in December 2020 to remind us of our place in the vast Milky Way and outer space. Jupiter takes 12 years to circle the sun, Saturn 30 years they came this close in 1623. As Giles Sparrow points out in his book "21 Stars in The Milky Way," ther are 200 billion stars, and distances are vast beyond comprehension. Thousands of years for light travelling at 300,000 kilometres a second to get to earth from distant stars in The Milky Way! Think of that and there is so little we know at this time of the pandemic about so many things!

LyrArc Article Gist
Fannie Mae and Freddie Mac are required to send nearly all profits to the U.S. Treasury in the form of dividends. By the end of 2013 the two companies will have paid $185 billion in dividend payments, close to all the $186 billion in aid provided by the U.S. government during the housing and mortgage crisis. Fannie will have paid $113.9 billion of the $116.1 billion in aid given by the U.S. Treasury, and Freddie will have paid the entire $71.3 billion in aid given by the U.S. government. This was possible because of the recovery in housing prices since the collapse of the housing market in 2009. Most of the housing price recovery occuring in the worst hit states California, Arizona, Nevada and Florida as buyers were attracted to lower price homes in foreclosures and provided Fannie and Freddie a large boost, followed by recovery in prices as traditional homeowners entered the market. At one point in 2010, Nick Timiraos cited estimates of $680 billion for total aid that would be needed for Fannie and Freddie, which shows how far things have come from the low point in the housing market. ...

LyrArc Article Gist
Andrew Roth describes a situation in Russia where president Putin is more popular than the ruling party. The United Russia Party was shown having support of 45% in pre election polls. The election campaign used Putin posters and the slogan "the party of the president," to increase voter support.  Some voters see Putin working really hard to improve the economic situation. Samuel Greene, director of the Russia Institute at King's College, London, says that even after efforts to increase support United Russia Party has failed to generate voter enthusiasm. Voter turnout was low especially in Moscow and St Petersburg. The election result is seen by experts as a way to give Putin support to tackle the economic problems facing the country, and ensure stability. About 343 members of the parliament out of total 450 are from the United Russia Party. The budget shortfall of 3% is being met by the government  by using state funds, and one of the sovereign funds is likely to be exhausted in 2017. One of the options is to cut back on social entitlements, increase the pension age. Prime minister Medvedev has already said state pensions cannot be indexed because "we don't have the money right now." ...

LyrArc Article Gist
This article in the Economist says the bad loans in the financial system threaten to derail India's rapid growth. It points out that about 17 percent of all loans are estimated to be non-performing. Government plans to set up a bad bank and have bad loans transferred at steep discounted rate to the bad bank are still at an early stage. India weathered the 2008 financial crisis with a financial system in better shape. Since then a surge in lending has led to an increase in the bad loans. Today both banks and corporate firms are facing this problem. The political system and dysfunctional governance with frequent changes for management at state controlled banks are part of the problem.

LyrArc Article Gist
A plan appears to have been put in place by the U.S. and the European Union countries to strengthen the American position in negotiations with Iran underway in Istanbul. The impact on oil prices and on U.S. and E.U. growth as a consequence of higher oil prices, especially when the eurozone countries faced lowed growth, was one of the ways Iran hope to blunt the tightening of sanctions against Iran's nuclear program. It now appears from information released by the International Energy Agency that a plan was implemented by the Saudis in recent months to build up reserve supplies. At the same time a similiar effort was being implemented to increase production in Iraq and Libya so that it would add to reserves added by the Saudis. Daily output from OPEC countries increased by about 1.4 millon barrels in the Sept 2011- March 2012 period, as the confrontation with Iran took shape with increasing pressure using sanctions on Iranian oil, according to the IEA. Of this 1.4 million barrels a day increase, one third is from the Saudis and the rest from Iraq and Libya, according to IEA. In March 2012, OPEC oil production increased by 135,000 barrels a day to 31.4 million barrels, mostly from higher output in Iraq. The Saudis have filled up domestic oil inventories and placed an additional 10 million barrels of oil in storage close to markets in Europe and Japan. This suggests that this was part of a quietly implemented plan in cooperation with the U.S. and the EU countries to increase the effectiveness of sanctions and protect global oil supplies from disruptions; even as the U.S. pressured Japan, S. Korea, India and other countries to reduce purchases of Iranian oil. The economies of India, the EU and other countries were already beginning to feel the impact of higher oil prices in the 1st quarter of 2012....

LyrArc Article Gist
A new West Coast Model is emerging with ballot measures in the states of Washington, California and Oregon. The model is to make up for decades of faulty income distribution which favored tech communities in west coast states leaving behind people from minority communities and the working class outside tech hubs such as San Francisco, San Jose and Seattle. During this period budgets for education and healthcare, social services and essential infrastructure suffered as budgets were squeezed for local governments. Minimum wage also lagged behind and communities struggled to keep up. Washington votes for a ballot measure that raises the minimum wage to $13.25 statewide and mandate paid sick leave for workers. In California a ballot measure makes permanent an income tax surcharge on millionaires to use these funds for education. In Oregon measure 97 places a gross receipts tax on corporations with annual sales in Oregon over $25 million, raising $3 billion a year for schools, health care and other programs. The California and Washington measures are likely to pass, Oregon uncertain, say experts. And even in Oregon supporters have learned from the experience to put forward new proposals on the ballot. The Washington measure is supported by Nick Hanauer, and Zach Silk, president of Civic Ventures in Seattle, who say it is essential to put more money in workers wages to increase growth and to bring better lives outside the tech hub areas. Most of the tech booms of the last two decades have not touched the areas outside tech hub metropolitan areas. The conservative approach adopted in Louisiana and Kansas of reducing taxes first and then when holes in state budgets developed to cut education, health and other service expenditures has not worked, and it has led to the backlash in the form of the new West Coast Model, which is expected to be brought up in other states in the east and midwest. The tech hub areas have grown with the boom in tech but this has largely ignored the rural areas, communities just outside of the tech cities, and led to uneven and distorted growth shortchanging the working class and the middle class, and hurting investment in education and healthcare across each state. Bill Whalen, a research fellow at Stanford University's Hoover Institution conservative think tank ,says that its hard to deny that the balanced growth for all communities across the state has lagged far behind as the tech booms boosted growth in the economies of California, Oregon and Washington. An article in the German online site Zeit on Silicon Valley described this vividly showing how this can happen in communities sitting side by side in the San Jose area, with minority Hispanic communities and working class communties seeing very little of the benefits of growth. ...

LyrArc Article Gist
Interview with Honda CEO Takeo Fukui. In June Honda will rollout a new hydrogenpowered fuel cell vehicle called the FCX Clarity. Its powered with electricity produced by combining hydrogen and oxygen in batterylike fuel cells. Honda will have this vehicle available for lease this summer in California and aims to deliver about 200 of these cars by 2010. Fukui's attitude is refreshing when compared to that of other automakers when answering a question by John Murphy of the WSJ about why try to build a hydrogen car when the stations to power the cars do not exist yet. He tells Murphy if you asked were there any gas stations when Henry Ford came up with the Model T, there weren't any, lets build the cars first and the infrastructure will follow. And Honda is working on the technology that will make it possible to charge hydrogen into fuel-cell vehicles at home . He sees it happening first in California and some other states, and in Japan and Europe. And he sees it taking about 10 years to get some sort of infrastructure in place. Considering the long term nature of the demand side with the gradual inclusion of billions of people in China and India as well as Brazil and Russia into the world economy as well as people in other developing countries this is a solution that takes patient and focused development of technology which Honda is setting out to do. He does not see a safety issue in use of hydrogen vehicles as he is confident Honda can develop the expertise to handle the safety issue for hydrogen. What is his thinking on green vehicles? What happened to the Insight the first hybrid car that Honda introduced? The Insight was never intended to be a mass seller, only to establish Honda's record as having the best record in fuel efficiency. What is Honda doing in this area. Honda does see a problem in this area. Toyota he says developed a green image largely on the back of one car the Prius. Honda will come up in 2009 with a dedicated hybrid vehicle to match the Prius. And Honda is setting the bar high for this Honda hybrid, saying that his feeling that this model will have to overwhelm and overtake the Prius. He goes on to say that this is key for us. Honda he says will take on the challenge and compete with Toyota with its products, its technology, and its racing spirit. This gasoline-electric hybrid will be introduced early next year in the USA, Japan, and Europe, and it will be the first of 4 hybrid models Honda will introduce by 2015. Regarding price the company says it will be "affordable". Honda's goal is to sell 500,000 hybrid vehicles a year. Toyota aims to sell 1 million hybrid vehicles early in the next decade and is working on developing its own hydrogen fuel-cell vehicle. Is Honda developing electric cars? Takeo Fukui thinks the practical feasibility of the electric vehicle is very limited. The two biggest issues in his view being driving distance and recharging time. The FCX Clarity can be recharged in one minute, compared to the several hours for an electric vehicle. In his view the electric vehicles will be uselful only for restricted applications like golf carts. Nissan and General Motors are planning to launch electric vehicles. What is Honda's environmental strategy? Honda being a smaller company has to focus its resources wisely with strategic choices. His focus is on the hybrid as the core product, and after that comes fuel cell and clean diesel as the core products to tackle fuel eficiency and CO2 issues. Takeo has spent more than a decade on Honda's racing teams. He drives a CR-V and enjoys driving up and down the mountains, does not race but does get on Honda's test track once or twice a year. And what has he learned from all the years in racing. When he was fully engaged in the motorcycle racing teams he says the pressure was very high and if they did not do well they got bashed by managers and the media. And actually the results were disappointing for years and the teams kept losing. For hime the series of difficulties and challenges was something that he feels everyone should experience because in some ways he acquired wisdom and creativity to get through these experiences. This is some thing Honda and Fukui will need as they try to develop their own hybrid to take the lead from Toyota and come up with industry leading technology in tackling fuel efficiency and CO2 issues. His own approach to management? Two things he always keeps in mind are take time to keep up good communication with associates at work, and testing Honda's own products with his own hands. What does he think about the auto industry in 2008, is it a turning point? He says it has becom clear in 2008 that a company has to have the technology to deal with carborn dioxide and fuel efficiency issues. And its clear that smaller vehicles are more attractive than larger vehicles. And its possible he says that we may go back from automobiles to motorcycles. In fact in India Honda is promoting motorcycles in a big way, while Tata is developing the Nano for mass market, so Takeo is talking about something that Honda sees happening in some places. ...

LyrArc Article Gist
Note this comment by the head of the U.S. National Highway and Traffic Safety Administration in the Bush Administration. NHTSA Administrator Jackie Glassman says the average mileage for the fleet today is 30 miles per gallon and raising the current standard of 27.5 mpg for an automakers passenger fleet by 2.5 mpg won't put much pressure on automakers. The Bush administration- and the prior Clinton administration- has not committed to making major improvements to the national mileage standards, with the current standards of 27.5 mpg not having changed since 1990! Glassman says the NHTSA starts with the manufacturers product plans and then sees whether it can get additional fuel savings with these plans. This suggests an NHTSA that is more follower to the auto industry rather than a leader in setting the standards that the auto industry then tries to achieve to reduce the U.S. dependence on foreign oil. Also note that it takes 2 years for things to change, as it will take months for rule changes, and 18 months have to be given to automakers to implement the new rules. By 2008 the fuel efficiency based on market competition and Toyota focussing on hybrids and higher fuel efficiency across the whole car lines, might well exceed any new standards that are watered down, especially if crude prices hold up. Lawsuits by attorney generals of different states and the Lugar-Obama bipartisan bill pushing the adminsitration to mandate higher standards are intended to put pressure on the Bush administration to come up with new higher standards. The failure of Democrats and Republicans in the Clinton and Bush years to raise standards and require the auto companies to use new technology to meet these standards with government assistance is one of the significant failures. This will affect the prospects for the U.S. economy in the years ahead....

LyrArc Article Gist
At one point the ruble reaches 80 to the dollar on Dec. 17, 2014, before settling at 60. It has lost more than half its value. The architect of Russia's finances in Putin's first and second terms, Alexei Kudrin, is critical of the way the central bank and the Putin administration is handling the economy and Russia's finances.

LyrArc Article Gist
After 5 years at 130,000 miles per hour, the NASA Juno spacecraft enters Jupiter's orbit. Jupiter is the largest planet in the solar system. An earlier spacecraft Galileo spent 8 years over Jupiter, but lacked the technology to survey the planet that Juno has. Information about Jupiter could reveal the origins of the solar system. A titanium valult protects Juno's critical systems from the volatile atmosphere around Jupiter. On the 37th orbit in Feb 2018 Juno will dive into Jupiter ending the mission but providing critical information on Jupiter.

LyrArc Article Gist
The IMF's estimate of extra aid needed for Greece to meet the damage done in the first 6 months of 2015 is $60 billion euros ($66.6 billion). The additional aid required is because of the worsening of the economy under the Tsipras Syriza party administration in the first half of 2015, the collapse in the negotiations, loss of trust, the imposition of capital controls, closing of the banks, and the growing uncertainty created by the referendum of July 5, 2015 on the debt talks and membership in the European Union. This may leave Greece worse off than before, as the cost of the cuts at issue in the talks were significantly smaller, and the small gradual improvement in the economy under the Samaras administration in 2013-2014 has suffered a serious setback. This is an unfortunate setback as Greece was allowed the needed flexibility on the most important points of the percentage of surplus and dateline, and cuts in the public sector employees.

LyrArc Article Gist
PC shipments worldwide declined by 14% in the first quarter of 2013, compared to the prior year quarter, according to IDC. Gartner Research's estimate for the first quarter PC shipments shows a decline of 11.2%. IDC analysts say the introduction of Windows 8 with touch screen capabilities has not reversed this trend. It may have exacerbated the trend because Windows 8 made changes that reduced the PC experience to bring in touch screen and other features available on tablets, and made the product more confusing to use. This view of IDC is confirmed by some companies which say the incremental value of Windows 8 is not worth the cost of training employees to use the new PC's with Windows 8.

LyrArc Article Gist
In 2013 the Greece government of Antonis Samaras made a study of wartime costs incurred by Greece for damaged infrastructure during the Nazi occupation of Greece and Nazil loans forced on Greece between 1942-1944. The estimate exceeded 200 billion dollars. Die Linke, a socialist party in Germany in the European parliament allied to Syriza, also supports debt forgiveness.