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The 45 million Latinos in the USA react with pride, and some parents talk to their daughters to see her as a role model. From Salvadoran immigrants, and Cuban immigrants to Mexican immigrants, to people in the Bronz and Puerto Rico. Demographic research by the Pew Hispanic Center shows that Hispanics are from many countries and have a diversity of opinions and attitudes. Two thirds voted for Obama, one third for McCain, 60% are native-born and 40% foreign born, 64% are of Mexican AMerican heritage, and the other 36% are from Cuba, Puerto Rico, Central America, and other places. They make up 15% of the USA population, and account for half of the country's population growth in the last decade.

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The Wall Street Journal CEO Council which met in Washington for a 1 day conference provided some idea about what CEO's are thinking. Laurence Meyer a former Federal Reserve governor said he projected a 4% annualized contraction in output in the 4th quarter and a 2% annualized contraction in output in the first quarter of 2009, and the US unemployment rate exceeding 8% by the end of 2009. That does not include impact of alarge stimulus program by the incoming Obama administration. Asked to vote by electronic device only one out of 93 CEO's said it will be 6 months before the economy returns to a normal growth rate, almost 80% were expecting a slow economy through 2009 and 2010.

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Rep. Dave Camp, House Ways and Means Committee chairman, representing northern Michigan, says every deduction in the tax code is there because of a reason, and powerful lobbies will oppose any changes. The best he can do is work himself out of this job as he will have to tackle the Democrats on entitlements, the business lobbies on tax loopholes, and other lobbies protecting their preferences in the tax code. He plans to achieve a simpler tax code with lowered rates of 25% for business and earners above six figures, and 10% for everyone else. The approach he is taking is to be revenue neutral when tackling tax reform, in the belief that the economic growth generated from a simpler tax code and lower rates would generate revenues of 18 to 19% of GDP, up from about 16% today. He says the economc cost of not getting this done to get the economy rolling again is so high that he is upbeat that both sides can come together after the election no matter who wins. He is also looking at a repatriation tax of 5% on profits kept by American companies overseas, which would boost revenues for business which could be reinvested in stead of sitting idle. Today the much steeper tax rate on repatriation makes businesses reluctant to bring it back....

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Adidas plans to open 2500 stores in China by 2015, including 500 in 2010, up from 112 today. Upscale outlets planned for the larger cities in China. The distribution will widen to 1400 cities by 2015, from 500 currently, by moving to smaller towns and cities in China's interior. Adidas also plans to ramp up its presence in basketball, a sport that Nike emphasizes. In China it will offer the NEO brand in smaller cities, targeting teens with prices about 50% of other Adidas brands. The strategy is to introduce Adidas products to people with lower incomes at lower price points, a strategy being used by Nestle, P&G and Unilever in consumer products for emerging markets. Adidas has opened an online retail store with Taobao.com and plans to bring in $500 in internet sales by 2015. Still North America with 14% growth will be Adidas's largest market, and sales in China are not likely to overtake sales in North America by 2015, according to CEO Hainer.

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Wells Fargo bank's share price reached a high of $51.90 on June 13, 2014, up 14% in Jan-June 2014. Richard Kovacevich arranged the acquisition by Norwest Corp of Wells Fargo & Co. in 1998. Wells Fargo has a 16% share of the mortgage loan business in the U.S., with $36 billion in loans for the first quarter of 2014. It is the third largest bank in deposits, with 6200 branches, the most branches of any bank in the U.S. Wells Fargo performance shows 15 quarters of uninterrupted profit growth, making it the most valued bank at the June share price. Over the last 10 years the stock price is up 76%, the best of any bank including Bank of America, JP Morgan, Citigroup and Morgan Stanley. Compared to the other banks Well Fargo has relied on its mortgage business and marketing traditional banking products aggressively through cross selling, staying away from investment banking and trading businesses.

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Barkha Dut says it is unacceptable that the Modi government- elected after corruption scandals in the previous Congress party government- allow the cronyism and collusion between business and government that existed under the Congress party in India. The $1.8 billion fraud at state owned PNB bank has drawn attention to banking and bad loans in India. Dutt  cites an Indiaspend report that shows in 2016 and 2017 5200 "wilfull defaulters"  made up bad loans given by the state owned banks of $8.65 billion, larger than the government allocation for farmer and agricultural welfare. Agriculture and rural farmers still make up a large part of the Indian economy and national elections results can be determined by how well the farmers are doing. In the recent Gujarat elections in Modi's home state the lower farm support prices for cotton farmers in Saurashtra region of the state led to Modi's BJP party losing that region in the state, and barely winning the election in the state with a thin majority. As a result the farm support prices for an extended list of farm crops was increased to 1.5 times the cost to farmers in the new 2018 Modi government Budget. To maintain a  steady industry and business policy for industrialization and modernization any Indian government needs the support of farmers. Modi has raised the issue of bad loans in the state banking system as being generated under the previous Congress government in a speech to parliament. A cleanup of bad loans in the banking system is needed to generate growth and investment for the Indian economy. Good governance in the country's banking system and vigilance of regulators is needed along with this cleanup of bad loans, as public confidence is shaken. ...

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The Economist points to a second hit from bad debt in the post 2008 stimulus binge of spending in China. This is after an earlier hit, that was absorbed as a result of high growth rates and high savings. About $420 billion was injected into 5 state owned banks since 1998, according to one estimate, as a result of the first hit to China's banks from bad debt. In this second round of bad debt, covered in more detail by David Barboza in the New York Times, and merely alluded to here, many bad loans to infrastructure projects were rushed through by local governments. The Economist considers this one of the successes of the state directed banking system, that loans were quickly made and projects started in the post 2008 crisis period; and expresses the view that this hit will be absorbed just like the last hit. However the more detailed account by David Barboza and in Business Week, points to the working of a system of incentives gone astray in a capitalist system without the necessary controls or regulation. Local governments used investment companies to take on loans, which were then used to prepare properties to be auctioned off at a profit and speculative prices to state owned companies in different industrial sectors. This is part of rampant speculation in China in real estate markets. Can China with its high savings and growth absorb a second hit? This depends on the magnitude of the hit and the size of the bad debt, which depends on how long this speculative market continues to operate, and how bad debt is hidden in the books. The difference this time is that large state owned companies in different industrial sectors are engaged in this speculation. The other difference is that the high growth rates in China depend on continued large trade deficits with the USA and Western Europe, something which is not likely to continue for long, as consumers in Europe and the USA with high debt are becoming cautious spenders. This suggests that China, like the US with the mortgage crisis, faces the same effects of unregulated or uncontrolled speculative behaviours, that can endanger the banking system....

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ICBC's strong performance is largely because of the leadership of Jiang Jiangqing. Jinagqing was reluctant to engage in the large scale lending encouraged by the government during the 2008-2009 financial crisis. For this reason he is not popular with the leadership in the government and the Communist party. This could change considering the large number of loans from that period which are expected to go sour in coming years. The U.S., Spain, U.K. and other countries suffered from the effects of bad loans in the banking system and experts say China is not likely to be an exception. Especially considering the excessive lending during that period and slowing growth in China. When this happens Jianqing's banking skills and conservative approach is likely to gain increasing respect within China. Jiangqing has expressed the view that the last thing China needed was to go back to the situation in 2000 when China's banking system was weighed down with bad debt. One has only to look at the change in Spain where once respected senior IMF officials like Rodrigo Rato are now looked at very differently. Jianging's push for expansion overseas- so that ICBC does not end up being a regional bank- is not viewed favorably by the government, which looks for a domestic focus. ...

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WSJ reports DJT action on tariffs and Fed's new forecast of slight uptick in 2025 inflation to 2.7% from 2.5%, on growth slowing to 1.7% in 2025. Fed's head Powell says- “That’s really due to the tariffs coming in,” Slowing inflation  “is probably delayed for the time being.” The tariff action is based on reciprocal tariffs, "we charge them what they charge us," and is based on the principle of fairness in world trade that was carelessly sacrificed by previous US administrations under Clinton, Bush and Obama. DJT and Trade Representative Lighthizer highlighted the issue of unfair trade and created a consensus around this issue for creating a level playing field with American action on tariffs that was accepted by the Biden led Democratic adminstration to rebuild American Manufacturing. What happened under previous presidents was ignominous for America and these administrations as they allowed the loss of whole industries first in lower technologies and then in advanced technologies as foreign countries used hidden subsidies. America's textbook economists at Ivy League universities and previous administrations used economic theory that had little connection with reality to allow shipping manufacturing overseas, destroying communities and towns with loss of jobs and public services across the US. ...

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50% of European CFO's surveyed by CFO magazine and 60% of Asian CFO's think the dollar decline is permanent devaluation compared to a third of US CFO's. The Commerce Dept figures show January exports 16.6% higher than a year earlier, and the trade deficit down by 7% in 2007 vs 2006 which will accelerae in 2008 with the larger dollar decline. As long as European and Asian economies continue to grow a bit slowly but not in a recession like the US the positive effect of growing exports should continue. So far for the last 6 quarters according to the WSJ exports have contributed 1 percentage point on average to economic growth measured at annual rate while the housing slump has subtracted just over one percentage point on average. So this is no small feat for exports and it has helped make the economy more resilient to the shocks of housing and oil price. As long as the growth overseas is not affected to a great extent by the economic slowdown in the US exports can continue to play this role. As the housing crisis is primarily a US and UK phenomenon this should not seruiously damage the economies of Asia and Europe and their ability to take in US exports....

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Mervyn King, governor of the Bank of England, says growth is expected to be "sluggish" with higher inflation. Inflation increased to 2.7% in October from 2.2% in Sept. 2012, with rising costs of university fees. The growth of 1% in the third quarter he described as a one time situation because of the Olympics in Britain. The strength of the pound relative to the euro and the GDP decline in the eurozone also hurt Britain's exports. Economsts at IHS Insight expect the Bank of England to keep the benchmark interest rate at current level of 0.5% for at least 2 more years and increase asset purchases by 50-79 billion pounds in Jan-March 2013. Some economists see the need for other approaches because of tight bank lending. King says the central bank committee retains faith in asset purchases as a policy instrument.

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Britain's chancellor of the Exchequer, George Osborne, tells parliament it will be difficult for Britain to avoid a recession if Europe goes into a recession in 2012-2013. He also told parliament that British debt reduction will take longer than planned because of the economic slowdown. This means the British public will have to go through two more years of austerity than previously planned, now upto 2017. Britain will need to borrow an additional 111 billion British pounds through 2015. Britain's Office for Budget Responsibility forecasts economic growth at 0.9% in 2011, and 0.7% in 2012. Debt as a share of GDP will peak at 78% in 2015, instead of the 71% expected earlier. With strong opposition from the unions and a major strike planned by about 2 million workers on Nov. 30, 2011, the Cameron government plans to go ahead with its austerity measures. This includes eliminating 600,000 public sector jobs, and limiting pay increases for public sector workers to 1% for two years after the end of the current pay freeze....

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The UK Office for National Statistics shows Britain's GDP declined by 0.2% in the last quarter of 2011, compared to the prior quarter. The figures showed a drop in business investment. Polls by ComRes, show 51% of people in Britain see the government austerity cuts as having an adverse effect on the economy, with cuts being larger and coming too quickly.

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Of 161 million people employed in 2024 about 40-50 million in vulnerable groups living from paycheck to paycheck and without savings to support them in a medical emergency is a real problem in the US economy. It is why even as unemployment looks good at 4% and inflation down to 3% there is a lot of angst for Americans for cost of living. Fifteen million baby boomers who will turn 65 years for retirement between now 2024 and 2030 face a situation where they have less than 250,000 in savings. Many who were born between 1945 and 1962 called baby boomers are in this group with diminished savings. In the prime of their careers they were hit by the 2009 financial crisis caused by bank speculation risk taking. They also were hit by the pandemic in the peak years of income growth. Other such vulnerable groups are young people with high student who are being helped by president Biden. There are also the low income groups that have been hit by medical costs and a family emergency that were pushed into poverty. Other groups in the millions are the people at the low income levels who are working paycheck to paycheck because of housing costs. About one fourth or 25% of apartment renters are people whose households budget shows 50% or more going to housing costs which have increased 20% in the last 2-3 years, which includes the pandemic years 2022 and 2023. President Biden seeks to limit apartment rent price increases to 5% and Kamala Harris has proposed help for families for the portion above 30% of household income going to rent. The jump in cost of living from automobiles, automobile repair and housing, cost of groceries have affected other groups with large credit card debt. This is a result of the supply chain concentration in China which comes from American business overconcentrating production in China and previous administrations doing little about this. Biden's answer is to bring jobs and manufacturing knowhow and investment back to America. During the pandemic some people resisted getting vaccinated and lost their jobs, a million people lost their lives, others took early retirement seeing the stress ful lives during the pandemic, others including women quit to take care of children. This has reduced the labor supply to business leading to tight supply higher prices.The result is that there are about 5 such vulnerable groups each with about 5-10 million people for a total of about 40-50 million people at risk. For these people the cost of living presents huge challenges, including childcare. It includes young people and retirees, single women and families on low income hourly wages that have not kept up with inflation.  ...

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Germany's $ 3 billion aid to Ukraine can only go through if it is clear where the money comes from. Scholz and Habeck oppose taking it from pensions, local government spending, or needed transportaton infrastructure spending. Greens see this kind of funding with cuts from domestic needs as a cop out. Scholz opposes cuts in pensions. CDU suggests cuts in unemployment benefits. Scholz opposes this. Germany as a debt clause in its Constitution put in by former CDU chancellor Merkel. It doesn't make sense now with the needs in infrastructure and the extra revenue that could be generated in the economy from an expanding economy that has rebuilt and updated its infrastructure. Yet it is still in place and leaves Germany less able to cope with demands for security, defense, and for infrastructure, modernizing its economy. By contrast the US under Biden and Trump is committed to domestic spending on infrastructure and modernization, leading to faster economic growth than in the European Union in 2025-26. ...

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HP's Apotheker emphasized in an earnings call "the tablet effect is real and sales of the TouchPad are not meeting our expectations. The velocity of change in the personal device marketplace continues to increase as the competitive landscape is growing increasingly more complex especially around the personal computing area." By the tablet effect Apotheker means the Apple iPad. The tablet is becoming popular but not the other tablets from Samsung, HP and other makers. It is the iPad that is the product customers turn to and the tablets of competitors are not accepted as a substitute. As a result CEO Apotheker plans to exit the tablet and PC business.

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Robert Shiller explains why price increases in U.S. housing are likely to remain at inflation adjusted 1-2 % a year in coming years. The Zillow-Pulsenomics Home Price Expectations Survey, incorporating 100 forecasters, and the S&P Case/Shiller Composite Index Futures, as of Dec. 2012, both show this modest growth for the next 5 years. The sharp price increases of 2012, with the S&P/ Case-Shiller 20 City Index up 9% from March to Sept. 2012, are seen as partly seasonal and not likely to last. Reasons he cites against the possibilities of another U.S. housing price surge are a more regulated housing market, wary buyers, lower economic growth, preferences for renting vs buying, and harder to rent detached single family homes. Recent housing price increases also include seasonal fluctuations and could moderate in coming months, says Shiller. History shows only one housing price boom in the U.S. in the last hundred years, with real prices increasing 68% from 1942 to 1953. By comparison the price surge in home prices from 1997 to 2006 was 86% in real terms, which was reversed almost entirely by 2012. The Census Bureau statistics show the home ownership rate declining to 65.5% in the third quarter of 2012 from 69% in the third quarter of 2006. Karl Case said in an op-ed in the NYT in 2010- the investment in a home was never meant to be a way to pay the bills and enjoy an artificially high standard of living, and only seen as a safe investment for most of American history. ...

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There is a mixed picture behind the drop in investment in new oil exploration. The IEA estimates that overall investment will be down 15-20% in 2009. The number of drilling rigs in use globally fell 32% in the year to April 2009, to 2055, according to Baker-Hughes, an oilfield services firm. In America the number of rigs in use is down by 50%, and OPEC countries are cancelling 35 big projects, according to the OPEC secretary general, Salem Al-Badri. Cambridge Energy Associates estimates that 5.5 million barrels a day of capacity additions may not take place in the next couple of years, which is a third of expected net increase by 2014. Examine this a bit more closely and you find that the oil majors despite lack of access to oil in inhospitable terrain or foreign countries, are still holding up well in investment. Exxon increased capital spending by 5% in the 1st quarter 2009, and Shell and Chevron plan to invest the same in 2009 as in 2008, $31 billion and $23 billion. BP plans to go from $21 billion to $20 billion. Canadian Tar Sands investments are being reevaluated in the light of prices, and smaller companies like Devon Energy are cutting back, for Devon from $9 billion in 2008 to $4 billion in 2009. From the national oil companies the investments are holding up in Saudi Arabia, whereas they are faltering in Russia and cash strapped Venezuela. Saudi Aramco recently completed a 5 year project increasing capacity from 10m b/d to 12.5 b/d at cost of $70 billion. And another $60 billion is set aside for more investments which will be less vigorously pursued as Saudis have 4.5m b/d of idle capacity after production cutbacks by OPEC. Petrobras plans to increase its investment by 55% to $174 billion in the next 5 years in offshore discoveries challenged by deep waters and thick layers of salt. The oilfield services companies like Schlumberger are cutting back, with Schlumberger cutting investment in 2009 by 13% to $2.6 billion and shedding 5000 jobs. Baker Hughes shed 3000 jobs. Mature fields are also receiving less investment, so that the drop from mature fields will be 9.4% according to IEA instead of 7.7% projected earlier with larger investments. The picture described above shows investments by the Saudis, the majors, oil field services firms, investments in recovery improvements in mature fields, not in a precipitious decline. The picture is of cautious and careful investment and some pullbacks as the economies of the US suffered decline in GDP of 6% in the 1st quarter 2009 over prior year and the German and Japanese economies suffered decline of 15-16%. Even the most optimistic forecasts for China do not go above 8% for 2009. In the light of these growth estimates the moderate drop in investments in new oil exploration may match the moderation in growth in Asia and the drop in growth in the USA and Europe and Japan. The forecasts of steeply higher oil prices or spikes like those in 2007-2008 are based on the notion of a quick economic recovery. See the links to economic recovery on this. These links suggest that the current surge may not last as the basics for a recovery are weak. In the US foreclosures, toxic assets, housing, consumption and savings, and unemployment all indicate a weak economy for several years down the road. And it is this weakness that the oil investment exploration budgets may be responding to in amoderated manner. The latest sign of this weakness is the spread of foreclosures to prime borrowers with job losses, link NYT May 24, 2009. The Saudi king thinks that $75 is a fair price for oil. Current prices have taken oil to $60 a barrel, even as inventories remain strong with over 60 days of supply. No spikes like those in the past are realistic in this economic environment....

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The written WSJ interview with Xi Jinping ends with a quote used by Jinping from Chinese philosopher Mencius- "It is only natural for things to be different." Jinping couples it along with another old Chinese saying for a broader meaning- respect your own cultural values and differences, yet be open to outside exchanges if you don't want to end up being ignorant. That quote is: " Learning alone without exchanges with others will lead to ignorance." This focus on outside exchanges seen as technological cooperation so that China has access to western technology to continue its progress in modernization and growth, is something most developing countries accept as critical. Is it seen as broader by learning from the general experience in many fields of other countries in Europe, the Americas and Asia?

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Russia's Economy Minister Alexei Ulyukayev, says Russia's economy contracted in the first of 2014 compared with the prior quarter. Intensifed capital flows and lack of new investment could lead to the economy and GDP declining by 1.8% in 2014, according to the ministry forecast. Russia experienced capital outflows of $60 billion in the 2014 1st quarter, almost as much as for all of 2013. Russian law caps spending not covered by direct revenue at 1% of GDP. He called for tapping the rainy day fund for spending on infrastructure and investment to revive growth. Currently much of the revenue from high oil prices goes into building up the rainy day fund, used to cushion the impact of financial crises, after learning from the disaster of the 1998 financial crisis when the ruble collapsed.

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How the Drug Industry and Drug Companies will go through a complete change and look nowhere near what it looks like today. Huge changes are overtaking the Drug industry and old ways of doing things will go out the window. Patent expirations for blockbuster drugs, safety issues, increased regulation, rise of generics drugs, cost issues, outsourcing of manufacture and testing and some R&D, changes in marketing practices, slimming down of marketing and sales force personnel, new approaches to R&D- Novartis emphasizing science, Glaxo breaking up into smaller teams, and the growth of emerging markets. All this happens as the public in the USA looks at healthcare in anew way and the demand for healthcare expands quickly in growing developing countries of Asia, Africa and Latin America and Eastern Europe.

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Japan is playing an increasingly positive and significant role in stabilizing the international financial system, and in providing new ideas for solution and proactive measures, some of it based on its own experience with a long sustained economic downturn from which it only recently emerged. It has dedicated $100 billion to the IMF for loans to emerging economies, which will be a significant help in preventing a severe downturn in developing countries. Here Prime Minister Aso outlines ideas that Japan will bring to the global talks this weekend November 15-16, 2008. The significant immediate steps are early and thorough disclosure of nonperforming loans based on valuation and reliable standards, and the removal of these loans from their balance sheets as a top priority. Japan was slow to do this prolonging its downturn into a decade or more of no growth. Other two priorities are injecting capital into banks with government money, and supplying ample liquidity from central banks and US dollar liquidity. After the immediate challenge there lie 7 areas to be addressed in the medium term. Improving savings and reducing consumption in countries dependent on external debt and moving to domestic demand led growth in export dependent economies. Bolstering the resources of the International Monetary Fund and the Asian Development Bank. Changing the governance structures of the IMF and the World Bank and other bodies to give proper representation to emerging economies that play an important role in the world economy. Giving the Financial Stability Forum a status above standard setting institutions like the Basel Committee, the Forum reinforced and reorganized to give membership to emerging economies. International Accounting Standards Board, governments, companies and investors in ajoint effort work to come up with a set of standards that have global application. And tightening standards for credit rating agencies through the International Organization of Securities Commissions. Aso proposes giving various countries legal authority over these agencies and the nurturing of credit rating agencies in each region in addition to global agencies, for the development of regional bond markets. Aso is also pushing for regional cooperation like the initiatives in East Asia such as the foreign exchange swap mechanism. ...

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All sectors of the U.S. economy see an increase in hiring, including retail, transportation, healthcare and manufacturing, as the economy adds 288,000 jobs in June, according to the Labor Department. Manufacturing added 16,000 jobs, transportation 17,000 and the public sector increased jobs by 26,000. Hiring also picked up for high school graduates compared to the poor record in 2013. In 2013 one Barclays economist says the jobs for high school graduates at this point were declining by 16,000 a month on yearly basis. He says employers are now adding 29,000 jobs for high school graduates a month in 2014. The unemployment for high school graduates declined to 5.8% in June 2014, for persons with some college education or an associate degree 5.0%, for college graduates 3.3%. Barclay's estimate is that the U.S. added an average of 231,000 jobs a month for the first half of 2014. The inflation rate remains at about 2%, giving the U.S. Fed more flexibility in setting rates to support jobs growth. The lower unemployment rate of 6.1% understates the underemployment, as a more accurate measure of employment which includes people working part time because they cannot find jobs is at 12.1%. The proportion of Americans in the labor force is also at a 36 year low of 62.8%. These two indicators for unemployment, unemployment including people working parttime, and the proportion of Americans in the labor force, combined with inflation, are the main indicators Fed chairmam Yellen is looking at....