LyrArc Article Gist
Biden efforts to reduce the level of escalation in relations with China include a visit by Secretary of State Blinken to Beijing in June 2023. The US says it seeks "to responsibly manage relations with China." The visit of Blinken to China was planned for February 2023 but postponed after the shooting down of a Chinese balloon craft in US airspace. China's support of Russia in the war with Ukraine has further strained relations. A similar effort is under way to reduce tensions with Iran by approving 2.5 billion euros payment by Iraq for Iranian oil deliveries. China sees Biden's efforts for stronger competition with China as affecting its economic interests. It seeks economic ties in the face of a slowing economy preserving its advantages in manufacturing developed over 2 decades. The Biden administration seeks with the EU a new supply chain that corrects the errors of overconcentration of manufacturing in China. This is what China means when it refers to the Biden administration stoking "competition" with China, as affecting China's sovereignty and national interests.  ...

LyrArc Article Gist
The supply of shale oil in the U.S. is changing the landscape for Mexican crude exports to the U.S. especially light Olmeca crude. Mexico's exports of crude oil declined to 881,000 barrels a day in 4 weeks through Jan 10, compared to 1.8 million barrels in Feb 2013, according to the Energy Information Administration. The Keystone Pipeline from Canada could also impact Mexico's exports.

LyrArc Article Gist
Germany's DW.com looks at the influence of money in US elections. The Supreme Court decision in 2010 for Citizens United said First Amendment rights of free speech enshrined in the US Constitution were not based on the identity of the speaker as an individual or other entity. Corporations and unions were allowed the same rights of free speech. No limit was placed on contributions of companies. This has increased the influence of companies and corporate interests in US elections. This undermines public confidence in the election process. In one instance a billionaire said he would contribute $45 million a month to the former president's campaign. In one talk show the former president offered a position in his administration to that billionaire. In another instance a large Silicon Valley contributor offered large contributions to Harris-Walz and yet remained critical of Biden's choice of regulator Lina Khan at the Federal Trade Commission.  This shows the influence of companies in financing after 2010 is becoming more direct and blatant. Yet US has never had the kind of strict laws existing in Europe on election financing and not setup a public financing mechanism as in Europe. Even before Citizens United SC decision tech, pharmaceutical and oil companies lobbied heavily using the existing laws to their advantage to buy influence.    ...

LyrArc Article Gist
Luis Almagro, president of the Organization of American States, from the small South American nation of Uruguay, says he has decided to speak up on Latin American issues, for respecting the sentiments of the people and democratic process. This is a welcome trend and more Latin American voices need to be heard, for Latin Americans to make their own assessment of the needs of the people, the problems and how to tackle them. More dialogue is needed between the government and the opposition parties to come up with better approaches and throw light on problems. The effort of Mr. Chavez however well intentioned, following neglect of social spending and needs of neglected groups under previous administrations, has gone to the other extreme leading to isolation from the rest of the industrialized world's economies- something no country can afford to do today because of the pace of technological change, much less smaller oil or commodity dependent economies. Large petroleum subsidies need to be addressed in Venezuela, as Mr. Maduro now says, and opening of a dialogue with the opposition parties is one result of Mr. Almagro's efforts. At some point a transition is needed with support of all political parties to bring Venezuela back into the global economy. Inflation of 141%, and contraction of the economy by 10% hurts all Venezuelans. Not even faint traces of the Monroe doctrine that asserted U.S. dominance in South America exists today, and it is upto Latin Americans to tackle problems of corruption, misguided policies, lack of emphasis on innovation and education. The Washington Post's deputy editorial page editor Jackson Diehl, does a service to Latin America by calling attention to such voices for dialogue and problem solving....

LyrArc Article Gist
Joe Biden was about 78 when he entered the presidency. Reagan ended his presidency at age 79 in 1989. It is about 35 years since Reagan, and advances of medicine are making it possible for people to work longer with retirement ages extended to age 65 in many countries. Mr. Biden looks healthy and brings much experience from his decades in the Senate of the US. His 36 years in the Senate are the longest for any president. Turning 80 should not be a hurdle in that sense if one is healthy and the country needs this experience. During a foreign affairs crisis with China and Russia this experience of 12 years as ranking member of the Senate Foreign Relations Committee is invaluable. More so as Biden reflects America's values. During his 36 years in the Senate he put forward the Violence Against Women's legislation in Congress. As Vice President he continued to advocate for working class and middle class and for families. One has to go back to Harry Truman to sense this kind of fervent and resolute action for workers and families, and for the American people. As president he passed the $1 trillion legislation for Workers and Families and to fight Climate Change. Building America Back Better is one of its goals and further investment in America and its people is being pushed forward.  Mr. Biden is living at a time when there is a struggle for the soul of the nation and he believes in his role in this struggle which gives him the energy he needs for his role in 2024 for continuing the work he has begun. ...

LyrArc Article Gist
The sudden change in the prospects for Venezuelan bonds with the sharp drop in oil prices by Dec. 2014. Price of credit default swaps on Venezuela debt show a 61% chance of default in 2015, and a 90% chance of default in the next 5 years. In previous years Venezuela debt was considered safe by emerging market investors because of oil revenues. Venezuela and its state owned oil company, PDVSA, issued a significant amount of debt from 2007 to 2011. Analysts say the debt outstanding for PDVSA and Venezuela is $66 billion. In the short period of a year sharp declines in commodity prices have created a crisis for Venezuela's finances. Fitch Ratings has lowered the credit rating on the bonds to CCC from B. Venezuela's benchmark bonds traded at 46 cents to the dollar on Dec. 19, 2014, after dropping as low as 38 cents. Yields on short dated bonds are above 40%. Problems in Venezuela can create contagion effects for other emerging markets- Russia, Argentina, Turkey, Brazil, India, Indonesia, China- especially with Fed signals about raising rates which lead to capital outflows. ...

LyrArc Article Gist
India is a major partner for Africa in the areas of energy and healthcare. India is a critical partner for Africa during the coronavirus pandemic in providing medical supplies and maintaining the critical supply chain. Indian oil and gas firms have invested $7 billion in Mozambique. India is Africa's third largest export market and India has $54 billion in investments in Africa. Foreign minister Jaishankar called India a reliable partner for Africa interested in developing the region. In fact Gandhi first started his nonviolent struggle in South Africa on behalf of miners in the region and fought for rights of African and Indian people in British South Africa. As a leading member of the British Commonwealth of nations India has a long history of ties with South Africa, Kenya, Tanzania, Nigeria, Ghana and other former parts of the British Empire. Indian workers and merchants played a large role in development in Africa after and during British rule. There are also older ties with Portuguese ruled Africa (Mozambique and Angola) with Portuguese settlements on the east coast of India. The Indian Ocean ties go back to the 15th century. ...

LyrArc Article Gist
A further drop in the value of the ruble would increase the cost of servicing the $500 billion in foreign debt. Fitch downgraded Russia's credit rating to BBB, the main concern being the drop in foreign exchange reserves, down by $210 billion to $390 billion in 6 months. Forward rates on the ruble imply a further depreciation of 20% in 12 months. Russia last week abandoned its committment to stick to the 2009 budget. After the first $29 billion bailout for banks another $40 billion has been assigned for the banks. All this has shown clearly that for Russia the job of reforming the economy, of changing its dependence on oil and commodities, and shifting to manufacturing and high tech industries has hardly begun. As a writer at the Financial Times put it in a CSPAN talk show, Russia is like 120 million people gathered around a oil wellhead. Or as another writer puts it, it remains a dangerously leveraged bet on the oil price. This has ominous implications for Russia, and serious social implications in terms of unemployment, social unrest, and a crisis of expectations, as for the second time in the lives of this generation hopes are raised only to be disappointed....

LyrArc Article Gist
Paul Krugman reviews a book by Robert Gordon, a distinguished American economist and historian, on the improving standard of living for Americans after the war in the period 1940 to 1970. This period brought some of the major changes in the standard of living which have since stalled. Gordon points to the developments in science and technology between 1870 and 1940 providing the largest boost to standards of living as the quality of life improved- especially the conditions in which people lived using modern sanitation, electricity, automobiles, and work saving appliances. The period 1940 to 1970 enabled the spread of this to the country as a whole. The IT revolution's developments occuring between 1990 and 2005 are also behind us. This process between 1870 and 1970, with the followup period to 2000, is seen by Gordon as a one time development in the scale of change and the improvement of quality of life. The future does not hold a similar level of progress in standards of living, says Gordon. Set against the current stagnation in incomes, widening inequality of opportunity, and the political discourse, this review raises important questions about the future. Quality of life potential now rests in improvements through personal involvement in health improvement, improved education, renewable sources of energy, and other ways, which are more soft knowledge improvements than the hard improvements of the past- which may require more personal involvement than in the developments of the last century of progress, with some improvement coming from renewal of the old physical infrastucture using the new technologies available. Just as the developments of the last century required dogged persisitence and effort, these developments will require dogged persistence and effort, with some of the easy stuff currently posing as technological development not qualifying....

LyrArc Article Gist
The St Petersburg Circle and German-Russian relations. The role of Schroeder, former German chancellor. Note that the SDP and the Christian Democrats split posts for Angela Merkel to head the government. Shows how the international geopolitical scene is evolving in new directions and affecting oil policies of key oil producers, as well as how the European auto producers are working with Eastern Europe and Russia for manufacturing. It shows a more confident Russia as a center for R&D for Western companies like Boeing.

LyrArc Article Gist
"It may be that this iron curtain is small, unimportant and justified, but it is a bad sign." Howard Buffett took a stand in the House of Representatives against the VOA broadcasts being used inside the US in 1947.  Warren Buffett is the son of Congressman Howard Buffett of Omaha, Nebraska, who was on the Board of Education of Omaha, started a small stock brokerage firm, and ran for US Congress in 1942, reelected twice and in 1950. He also ran Howard Taft's Republican presidential campaign in 1952. Looking at Buffett in the FDR-Truman years- one sees a young Buffett in contrast to Warren Buffet's silence on the 2008 financial crisis, raising serious issues- about the Truman doctrine in 1947 on the floor of Congress, was Acheson falling dominoes analogy a dangerous one?  It worked in Turkey-Greece with $400 million in aid in 1947 but was Acheson/Truman using a dangerous analogy of dominoes that would later hurt the US in French colonial Indochina wars, and in the reference to protecting oil resources in Middle east in Iran, Iraq and Saudi to lead to wars that exist to this day in 2024? Wars DJT and Biden have both opposed in contrast to Reagan, Bush, and Obama. There is a huge contrast between the father Howard Buffett, descendent of Huguenot ancestors from 1600 New York, and the finance professional Warren Buffett who went to Columbia University in 1951-52 as student of Prof. Graham with 70 years in finance during which financial crises destabilized the US with Buffett not taking a stand. One hedge fund manager say it is pure nepotism to pass on the company Berkshire to Warren's son Howie. But he is not surprised- who else would be sure to keep the company headquarters in Omaha, keep things simple invested in index funds and much of it in a few companies leaving the investing to managers chosen by Warren, with Howie's job to make sure his father's principles remain. Howie is Warren Buffett's 70 year old son, who Buffett 90 years is setting up as his successor as chairman who will not do investing leaving it to managers, yet be able to change CEO's. Howie worked for a few years at See Candy, a Berkshire owned company before becoming corporate VP at ADM food producer, followed by working on his own farm in Decatur, Illinois which he enjoyed doing. At ADM Howie left after an anti trust investigation began, in which the company was charged with $100 antitrust fines for price fixing says the WSJ. What is Berkshire Hathaway? It is a trillion dollars of investment funds invested in a few companies under name Berkshire Hathaway, using some of the basic ideas of Benjamin Graham, a pioneer in careful investing, adopted by Warren. Where has Buffett put his money? Berkshire top ten investments are- about $90 billion in Apple, $70 billion split between Bank of America and American Express, $30 billion in Coca Cola, and $30 billion split between 2 oil companies Chevron and Occidental. He has not invested in pharmaceuticals or in renewable energy- in just a piece of America.This has generated a compound interest of about 14% over 3-5 years and about 12% over 10 years. He holds 30% of his investments in cash or fixed, mostly cash at this time. And holds the remaining 70% in stocks. ...

LyrArc Article Gist
Senior diplomat Song Tao, who heads the external affairs department of the Chinese Communist Party, will visit Pyongyang to brief the Korean Workers Party on the recently concluded 19th Party Congress. This visit will reopen a channel for discussion between North Korea and China after the deterioration in relations between the two countries over nuclear tests. The Director of the Carnegie-Tsinghua Center, Paul Haenle, says the contacts are intended to not let things get too bad. China provides the crude oil lifeline for North Korea, and is pushing for negotiations.

LyrArc Article Gist
Reducing income inequality and increasing farm incomes would increase consumption spending and investment for further growth in the Indian economy. Investment in infrastructure development is another source of growth. Higher oil prices and the bad loans in the banking system are barriers to increasing growth of the Indian economy. The problems during the last 2 years of the Congress led UPA government, including the bad loans in the banking system and the uncertainty after corruption cases including the telecom auctions, required that the Modi government take strong action in the first year. 

LyrArc Article Gist
James Stewart of the NYT looks at the outlook for U.S. and international stock and bond markets in 2016. In 2015 stock and bond markets in the U.S. and international were affected by the huge fall in the price of oil and the sharp slowdown in the Chinese economy. This affected commodity producing countries and the oil industry worldwide including the U.S. The slowdown in China affected stock markets in other countries including Germany.

LyrArc Article Gist
The European Commission cuts 15 nation euro area growth forecast for 2008 from 2% to 1.4%. For the 27 nation European Union the forecast is dropping from 1.7% to 1.3%. Link this to discussions at OPEC in Vienna and one can see why the Saudis use the argument that high oil prices can lead to a collapse in demand and a collapse in oil prices not helping consumers or producers, when a stable price that reflects the fragile financial markets in the west would better accomodate both sides.

LyrArc Article Gist
A history of French nuclear energy. How it got started in the area known as Beaumont-Hague. The decision of the French government to pursue nuclear energy and set up new nuclear plants. The efforts to Frenchify the early nuclear technology developed by Westinghouse in the U.S. Today nuclear plants produce 78% of its electricity. Setting up the industry has cost about $120 billion and France has accepted the risks of spradic radiation leaks. Electricity accounts for 20% of French energy consumption, oil takes up 49%, leaving France still dependent on foreign oil.

LyrArc Article Gist
The nuclear trade deal with India and approval by the Nuclear Suppliers Group. If passed by Congresas in September the deal goes into effect. At the NSG, New Zealand, Austria and China were the holdouts and had to be persuaded by the United States. Under the deal India cannot conduct nuclear weapons tests and if it does its upto the USA to decide if it will continue to supply India with nuclear materials and technologies. India is running short of uranium and other nuclear materials it needs for its civilian andnuclear weapons programs since it was refused access by the NSG after earlier tests decades before. It also depends on how the US sees China and Pakistan in relation to India and its nuclear programs. One thing is certain India will push forward aggressively with new nuclear energy programs and setup its own nuclear energy reactors to provide its growing energy needs and to reduce existing shortages and also lower its oil bill. So in the next couple of years or the next decade the world will certainly see the peaceful development of nuclear energy and development of new technologies in the nuclear energy field as India becomes a key user and developer of nuclear energy technologies. At that point India may become a part of the fabric of peaceful nuclear energy development in the world as it meets asignificant part of its energy needs through nuclear reactors. It will be a welcome development as it will ease the burden on oil supplies that in the case of China became a key part of the upward pressure on oil prices as China relied mostly on oil and gas for energy needs. This is probably the thinking in the current Republican administration as it pushed hard for this nuclear deal to supply India....

LyrArc Article Gist
Technology is reshaping the world of oil by 2018. The U.S. Permian Basin stretching from West Texas to New Mexico now produces more oil than the UAE and is likely to soon surpass Iran- production is at 3.1 million barrels a a day. There are as many rigs as in 2011 yet the production has tripled because of the use of high tech rigs that can move quickly to new locations over wide areas and with tech that can see hundreds of feet into the rock. By 2019 the U.S. will surpass Russia as the world's largest producer of oil. The drop in oil prices to about $40 a barrel in recent years is a result of Saudi efforts to block shale oil development by lowering prices. This has not worked. Initially some high cost producers exited the industry and the shale industry suffered. Over time the new technologies spurred by lower oil prices have led to the anticipated drop in cost. Shale oil can now be produced by core producers at $40 a barrel and still be profitable according to this WSJ report. All Middle Eastern countries cannot meet budget needs at $40 a barrel. In 2018 oil prices increased back up to $77 a barrel. In the next wave of declining prices the shale industry is better positioned than the OPEC countries.   ...

LyrArc Article Gist
The probability of rate cuts by the Fed increases with decline in core inflation even as inflation for the year is 2.9%. Higher inflation is because of 4% increases monthly of gas prices. The oil price increase is seen as a temporary factor with longer term inflation headed down.

LyrArc Article Gist
BP Russia is the only large joint venture in which a foreign company has a 50% ownership and it is highly profitable with net profit of $5.7 billion on annual revenue of $24.9 billion. The Russian government is consolidating the oil industry to make it largely a state owned industry and renegotiating old contracts for a majority position in all oil joint ventures. In the light of that policy and its implementation for several years it would appear that the BP joint venture also would be seen as part of the same scheme of things. The minority partners and BP would negotiate their way for the best possible situation in this scheme of things.

LyrArc Article Gist
Emily Glazer of the WSJ interviews Clorox CEO, Don Knauss. Knauss talks about his strategy to focus on the U.S. and Latin American markets and not make a costly effort to enter markets in Asia. He sees competition intensity in Asia and Brazil as much higher today with P&G and Lever focussing on these markets. Clorox is concentrating on brands known for being environmentally friendly such as its Green Works line of cleaners, Brita water filters, and products of acquired companies such as Burt's Bees. Knauss describes the Hispanic consumers preference for Clorox and Pine Sol for cleaning and the use of bleach 70% for cleaning. Hispanics use 25% more bleach than other consumers and prefer fragrances such as lavender for Pine Sol. These are some of the insights the company is using to maintain its penetration in this market.

LyrArc Article Gist
About 600 US and European company brands are leaving Russia. This report in the WSJ shows how ordinary Russians are coping with jobs in limbo. Many of these companies are continuing to pay employees but jobs remain uncertain. This includes companies like Sweden's IKEA that are popular in Russia. As western sanctions make operating difficult companies future is uncertain. This is creating anti-Western sentiment particularly in the rural areas which use mostly Russian made products and which are Putin's main source of support. Even Russians who question the attacks on Ukraine are skeptical how the withdrawal of these companies helps find a solution for Ukraine. This is happening even as the errors made by 4 term German chancellor of increasing the dependence of Germany on Russian energy supplies from 36% during Putin's annexation of Crimea to 55% today are becoming abundantly clear.That makes an energy embargo on Russia difficult for Europe, with German business saying this would be "catastrophic" because it is unprepared even though this alone provides about $1 billion a day to Putin's Russia. Meanwhile EU and other western leaders call attention to India's drawing 1-2% of its energy supplies from Russia even though one month of Indian imports is equal to just one afternoon of European oil and gas imports from Russia. India has done more than Merkel's Germany to meet the need for humanitarian vaccine assistance for the poor countries of Asia and Africa, Middle East, and is now engaged in meeting the needs of the world for foodgrains after the fallout from an Ukraine crisis that is a result of emboldening of Russia from Merkel's policies.  ...

LyrArc Article Gist
India's Foreign Secretary Ranjan Mathai says India will only give recognition to multilateral sanctions imposed by the United Nations. He said: We have accepted sanctions which are made by the United Nations. Other sanctions do not apply to individual countries. We don't accept that position." He was referring to the sanctions program of the U.S. government, under which countries would be granted exceptions and waivers from U.S. sanctions. Iran is the second largest source for India's oil purchases after Saudi Arabia. A multi-ministerial delegation from India is visiting Iran, and the delegation says Mathai will "work out a mechanism for uninterrupted purchase of oil from Iran and to work out a financing mechanism." South Korea which gets 10% of its oil from Iran plans to get an exception to U.S. sanctions under which it would reduce Iranian imports in 6 months from the date of a U.S. sanctions law.

LyrArc Article Gist
It is important for a correct sense of the Middle East to see these British Arab states from Kuwait to UAE and Qatar in the context of British India if one is to see them as part of the modern world as India is. This is now US policy under DJT and has been under Biden for a peaceful economically advanced region. A third of Arabian peninsula Arab protectorates were run from British India from 1800 onwards. The Interpretation Act of 1889 listed the states under British India in the Arabian peninsula including Kuwait, Bahrain, Aden now Yemen, Oman, Dubai, Abu Dhabi, and they were listed along with Jaipur, Hyderabad and Bhawalpur. British Prime minister Clement Attlee wanted to give independence to these Arab states along with the independence of India and Pakistan in 1947. But this did not happen till 1971. In 1937 the first of many separations from the British Empire in India of Arab states was announced. Aden, now Yemen, was separated from the British Empire in India to the Colonial Empire. British Empire authorites in Delhi never wanted to administer these Arab states even though the British Indian Political Service ran each of these states till 1971. They were very poor and lacking basic infrastructure, things changed only after the discovery of oil in late 1930's. ...

LyrArc Article Gist
Der Spiegel has this interview with Robert Habeck, Economy Minister of Germany, on how Germany will cope with a step by step cutoff of oil and gas supplies from Russia in winter 2022. Habeck says this is likely to happen. Der Spiegel ask Habeck questions about the various actions Habeck is taking to get Germany through this winter. This includes bringing back coal plants that were being phased out, plans for industry to pass on gas that it is not using, setting priorities for homes over industry where possible, providing aid to people with low incomes who cannot afford to heat their homes this winter. Habeck calls for greater efforts for conservation that can reduce gas consumption by 10% with simple steps such as shorter time in the shower,  setting the thermostat down by 1 or 2 degrees in winter, using air conditioning less often, cooking in a way that uses gas efficiently, increasing insulation in the home, better distribution of air in the home, and so on. How much time does Habeck spend in the shower- less than 5 minutes. He leaves home by 7 and gets back late at night after work. Does he think Germans have the grit and determination to meet the challenge Putin is posing of creating disaffectionmnin German society through first gas prices and then gas shortages this winter? Habeck believes Germans can and will respond in a way that takes Germany through this winter and through all the threats Russia under Putin is posing. ...