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The Fed over the past year has assumed, backstopped, or committed to take on about $2 trillion in assets from shaky financial institutions including Bear Stearns, AIG, Citigroup and Bank of America. In some cases the banks will assume some of the losses, or Treasury will accept some of the losses before the Fed comes into the picture. Another $1 trillion in lending could occur in 2009 as liquidity programs are tapped further by borrowers and the Fed purchases more bonds such as the ones sold by Fannie and Freddie, and securites backed by student loans, auto loans, credit card receivables and small business loans. This would result in a balance sheet for the Fed over 3 times what it was 18 months ago in mid 2007.

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Under president Macron France is pushing new ventures and startups as a way to increase job creation for young people. A new incubator Station F was opened in Paris recently. France's fund raising for new ventures is up tenfold since 2014 to over 2.7 billion euros. Tax credits of 5 billion euros and large investments in AI were announced by the government as a way to increase strategic investments in new fields. A large state sector and limits to hiring in the private sector under existing labor laws has limited job prospects for young people.

France is catching up with Britain in new venture creation and has a lot more to do before it creates enough jobs to make a difference. The corporate sector plans investments of 3.5 billion euros with creation of 2200 jobs over 5 years. Much of the investment comes from the French government's BpiFrance entity that makes grants and loans to new ventures.

 

 

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Flat payment rates for Medicare Advantage to Insurers by the DJT administration which is questioning how health care needs of the country remain unmet and US healthcare comparing very unfavorably with other advanced countries in Europe and Japan and also in India. Some of this is because of the behaviour and practices of the health and pharmaceutical industries in the US. The 2027 payment by government for Medicare Advantage is 0.09 percent. In 2026 it was about 5%. In 2025 it was -0.16 percent and in 2024 it was -1.12% under the Biden administration showing a great deal of dissatisfaction with funding Medicare Advantage. Medicare Advantage was set up by the Bush Republicans in 2003 who set it up with the nice sounding name Medicare Modernization Act. It was an effort to help the insurance companies with government money. Today in the second term of DJT in 2026 affordability is what American people care about most and the DJT administration is unhappy with the insurance companies. Dr. Mehmet Oz is in charge of Medicare and Medicaid Services Agency of the federal government and he says about Medicare Advantage and new policy to save “taxpayers from unnecessary spending (on Medicare Advantage) that is not oriented towards addressing real health needs.” The DJT Kennedy-Oz approach is for comprehensive digital information linking all medical providers, making America healthy again, cutting through the dense fog created over the last 2 decades, making pharmaceutical costs as affordable as the best in European nations, and refusing to subisidize if delivery is poor and health results are poor.   ...

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With fewer banks and securities houses remaining, the remaining banks like Chase and securties houses like Goldaman and Morgan Stanley are using the spreads between the price of buying and selling bonds- and the easy access to government money and FDIC guanrantees for their bonds- to make large profits. In effect the Fed is pouring money into the system to help financial institutions recover and in the process is making it possible for firms like Morgan and Goldman that were on the verge of collapsing to be able to make large profits through cheap money from the Fed. The resulting large bonuses are likely to upset a public and taxpayers who shoulder the dual burdens of a bailout of large banks, which is not making credit easier for small and medium businesses that form the backbone for employment. The smaller banks that support these businesses are failing and being closed by the FDIC. THe result- increasing joblessness and shrinking consumer demand. This is outlined by Ms. Lee in her op-ed article- The Banking System is Broken, WSJ, October 16, 2009. See this link. Meantime banks like Citigroup and Bank of America continue to see losses, so that even these profits are happening in only some parts of Wall Street....

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Alexander Van Der Bellen, a pro Europe independent candidate supported by the Green Party wins Austria's presidential election with 53.3% of the vote. The anti immigrant Freedom Party candidate Norbert Hofer wins 46% of the vote. Van Der Bellen is for an open Europe and is pro Europe. The election is seen in Germany as "lifting a great burden off of our shoulders," in the words of Sigmar Gabriel. This is important for the future of Europe as France, Netherlands and Germany face major elections in 2017.

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Even though Denmark is trying to portray this as about 60,000 people on an island almost the size of Canada, Denmark was a colonial power when it acquired the terrritory through merging with Norway and later in Treaty of Kiel in 1814 during the Napoleonic Wars it retained Greenland. In these European Wars lands were exchanged based on success of armies fighting the French. It is "completely useless" for Denmark and it has not invested in Greenland which is backward with poor standard of living, no infrastructure. The US alone can change that. For the US it needs to own the island to make the Eastern Seaboard of the US secure from foreign powers, a point Seward made when he sought to acquire it in 1867 along with the purchase of Alaska from Russia, Every American government since and including Truman has sought to do this. Denmark is in Greenland only because of its colonial power rivalry with Sweden and the British Empire, when it was exchanged or retained for other territories as was the practice of the Europeans in the 19th century wars. It is not there to develop the island, its infrastructure and improve its quality of life, and has never done this. ...

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Viktor Orban's defeat in the Hungarian election in April 2026 comes after decades of his blocking policies that emerged from the European Union in Brussels and is a relief for the European Union and Germany as it takes on the responsibility of leading continental Europe in its stance of opposition to Russia in the war in Ukraine with help of France and Britain. Peter Magyar who is staunchly pro European Union wins Hungary's 2026 election in a landslide with 137 seats to 57 with 77% of electorate voting as Viktor Orban concedes. Magyar's Tisza party gets 57% of the votes to 40% for Orban. Peter Magyar 45 years was part of the Orban Fidesz party before he formed his own party with dissatisfaction about the extent of corruption under Fidesz. Orban as head of the Fidesz was prime minister 1998-2002 then again in 2010 to 2026 for a period of 20 years spanning the first quarter of the 21st century. Magyar is not a progressive or so called liberal and shares many of the same views on social issues of Orban but he is pro-European Union and reflects the views of the Hungarian nation as independent in Eastern Europe and the Hungarian Revolution of 1956 in an uprising against Soviet rule. In the period before the two world wars from 1600 Hungary was the place where in addition to Austria and Vienna, the Hapsburgs and other European armies pushed back the Ottoman Empire's expansion into Europe. Hungary was a key part of the Hapsburg Empire which ruled from Vienna, Austria, over most of Eastern Europe for 1600-1918. The Hapsburg Empire collapsed in World War I on the side of the Germans and a new nation Hungary emerged by 1921 but was much smaller than Hungary of the Hapsburg era. Today Hungary is a nation of 10 million with its capital on the Budapest on the Danube river in the heart of Central Europe. ...

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This report in the BBC shows the effect of the highly competitive nature of business in Sweden on young women who face burnout from long hours and lone achiever culture. The individualistic culture in Sweden where young people at an early age become independent also increases burnout compared to living in a culture that is friendlier and more community centred.

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Prices of gasoline expected to peak at about $4.31 a gallon, while its much higher for diesel that powers trucks on the road at $5.80 in April 2026, according to Energy Information Administration. Diesel is produced mostly in Persian Gulf as the oil in the US is mostly suited for making gasoline and Gulf oil better suited for making diesel. Supplies were tight before Iran War already, while gasoline supplies are not tight. This is why diesel (and jet fuel) costs a lot more than gasoline in 2026.

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As jobs grow even with repeated increases in interest rates in 2023, inflation slows to 2.6%, unemployment rate at 3.7%, consumer sentiment is up 29% in 2 months in a UMich survey highest since 1991.US jobs growth of 353,000 in January 2024 the best in a year, twice what experts had predicted. The December figures were also revised upward by the Labor Department from 216,000 to 333,000. Unemployment rate held steady at 3.7%. Wages increased by 4.5%. Job gains in 2023 were mostly in government, healthcare, hotels and restaurants. In January growth was healthy across all private sector industries. The Fed's preferred inflation rate guage was 2.6% in December. Even with repeated increases in the interest rate by the Fed, growth is strong. Much of it could be attributed to the strong investment in infrastructure, and in manufacturing, US technologies by the Biden administration with help of bipartisan support in Congress.

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This editorial in the New York Times points out that the new president of the ANC party -that runs South Africa and has a monopoly of power in the post Apartheid years, under Mandela, Mbeki and Zuma- faces a uphill task as the ANC remains deeply divided after supporting Mr. Zuma in office till the very end. Apart from the stagnant economy, there are challenges the ANC faces in the lethargy of the post Apartheid years, and the culture of corruption, and patronage management that led to mismanagement of state enterprises.

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This report by Goodman in the NYT shows that the ANC has lost most of the moral authority it had under Mandela. After 9 years under president Zuma, and after the term of his predecessor Mr. Mbeki from 1999-2008, South Africa remains stuck with stagnant economy, and about two thirds of young people in the townships being jobless. The challenge is how to change the economy to where growth is generated and benefits go to a broader section of the population. Problems the new president Ramaphosa faces are how to change the protections given to conglomerates that dominated the economy under Apatheid, and the patronage network that evolved with the ANC in the post Apartheid era. Growth performance of the South African economy is dismal. According to the World Bank the South African economy in 2016 was about the size of the economy in 2009. Many warnings about the economy and the operation of the state run electric utility appeared during Mr. Zuma's presidency, including one by former president De Klerk. Growth in 2018 is expected to be only about 1.1%. The economic gains by the largely black population have suffered with lack of growth and mismanagement of the economy. Official unemployment is at 27%, with about two thirds of the young people in the townships being jobless.  ...

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Carlin and Lewis call for a reconsideration of US policy towards North Korea. They have visited North Korea several times, and say that Americans are as isolated from the North Koreans as the North Koreans are from the rest of the world. America once saw China and Vietnam as countries with which America found it impossible to engage, today it is N. Korea, say Carlin and Lewis. They also point out that with China's support on a long term basis, US hopes that North Korea will simply collapse is a weak reed to base US policy on.