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Automakers stand to lose a lot of money on their leased SUV's. Spinella, President of CNW Marketing Research estimates they could lose $4.7 billion in 2008, with losses extending into 2009 and 2010 which could cost them additional $10 billion. Why? Because many of these SUV's leased for as long as 39 months are on the road and automakers only recently started writing fewer leases, and as thes SUV's come back to the car lots they are marked way down. Automakers did not anticipate such a large markdown. According to Mannheim, the USA's largest vehicle wholesaler, between March an May the resale values of large SUV's have fallen 13%, with some pickups down 20%, as a result of $4 a gallon gasoline. Knowing the drop in resale values more lease holders are reluctant to buy or to extend their leases. Over the next 18 months GM will lose $600 million in lease related costs, and Ford will lose $1 billion, according to Chase analyst Himanshu Patel. According to Brian Johnson, Lehman Brothers analyst, GM's lending arm will lose $1.1 billion and Ford's $1.5 billion, GM's losses lower because GMAC is owned 51% by Cerberus Capital. Not just the American automakers, BMW took a charge of $400 million for losses in the first quarter on sales of off-lease SUV's and cars. ...

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Jeff Flake, U.S. Senator from Arizona tells Republican candidates, "Distance yourself from Trump," and Flake is thinking not just of 2016, but of elections to come.  In the West generally it is not just about minorities, but also the educated white collar professionals in cities such as Salt Lake City, Denver and Phoenix. The percentage of registered Republicans in Colorado dropped by 4 percentage points since 2012, and now Democrats have the same share of registered voters. In Arizona Hillary Clinton has invested resources to register more Hispanics and minorities. The distancing from Trump by Romney and the shift of the Mormon vote is making Utah also a place where Clinton is catching up in polls. As a result most of the West now looks very different. The remaining western states of Wyoming, Idaho, Montana and Alaska, say experts have a total of 13 of the 538 Electoral College votes. With Utah this is 19. 

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Japan's showed GDP growth of 4.1% in the first quarter of 2012, as it rebounded strongly from the 2011 earthquake and tsunami with higher public investment.

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The Japanese economy went through asevere contraction in the first quarter 2009, declining 15% on an annualized basis. But Japan's unemployment rate in April was 4.8%, compared with much higher rates in EUrope and even higher rates in the USA. France and Germany have social democratic states that protect workers jobs, and Germany even after the Harz reforms continues to help workers deal with unemployment making it least painful as possible with government help. Japan takes this astep further. The law in Japan requires that even though companies can cut worker's hours, they must pay at least 60% of their hourly wages during that time. THe government provides help. It has budgeted $624 million this year to reimburse companies for half of these payments. In March 48,000 companies got subsidies for 2.38 million employees according to government figures. This includes large companies like NEC Electronics and Nissan Motor. THey have to find things for the workers to do, community service like keeping the area clean, vegetable gardens, handicrafts shop, anything that helps the communities. A recent survey by the Nikkei financial daily, shows zero percent of large business owners said they had plans to layoff permanent staff members, compared with 39% in South Korea. WIthout this the unemployment rate, say experts, would be 2 percentage points higher....

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Toyota's Tundra plant in Texas looks to have come in at the wrong time. Its operating well below capacity and its hurting margins. Toyota sales in North America will decline by 188,000 according to forecasts for fiscal year ending March 2009.

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Italy's prime minister, Mario Monti put it best when he said in a speech in Brussels in April 2012: "If a country becomes more productive and competitive, but there is no demand for its products domestically or around it, growth will not materialize." There is a new shift in opinion towards a balance of fiscal discipline with growth measures to get Europe back on track. The feeling in different parts of Europe is that the German view of austerity alone will not work for Europe. And the view is coming from the far right to the far left, from Marie Le Pen, far right presidential candidate in France, to the far right leader whose move to withdraw support to the government in Netherlands on the issue of austerity measures led to its collapse. Geert Wilders, leader of the Freedom Party in the Netherlands, said: "we don't want our pensioners to bleed just to meet the dictates from Brussels." The IMF has put out research that questions what is now called "the German hypothesis." The "German hypothesis," is based on the unique experience of Germany with the Hartz reforms under chancellor Schroeder which were based on wage restraint by workers, the German "kurzarbeit" program of government support for retaining workers with lower pay during cyclical downturns, improving competitiveness of German companies, and conservative budget practices. There appear to be two exceptions to this. One is that demand has to be strong outside or domestically for a country to reduce unemployment and improve productive capacity utlilization as it increases competitiveness. This was the case as Germany made the Hartz reforms under Schroeder. Wage restraint acts as a form of devaluing currency for reducing the cost of its products to improve exports. All leading parties and the unions are now in favor of wage restraint and lowering wages to preserve jobs to improve France's competitive position. Germany had the benefit of a decade to implement these reforms to reduce unemployment, because demand was not declining domestically or around it during its reforms. The situation is different in Spain where in all likelihood demand would shrink further with unemployment rising from 25% to higher levels, and higher sales taxes. This is why Francois Heisbourg, special advisor at the Paris based Foundation for Strategic Research, says about the current situation in Europe, that destroyiing Greece with strict austerity alone wasn't something the EU can look back at with the sense of having done the right thing, for Spain it appears misguided and lacking careful thought. The editors of the Wall Street Journal expressed the same sense when they described the March 2012 bailout of Greece as a tragic sideshow, because the main purpose was to buy time and insulate the other larger economies in the EU by giving the French, Spanish and German banks time to improve their financial position. The Journal called it bad for Greece leaving it with debt at 120% of GDP till 2020 and no economic growth, and bad for democracy as it was done against overwhelming Greek public opinion- The Tragic Greek Sideshow, Feb. 22, 2012. Volker Perthes, director of the German Institute for International and Security Affairs, a Berlin think tank, says the Germans have always viewed German leadership in Europe with discomfort, and would prefer a leadership where several states, France, Italy, Spain, and other countries in the EU coalesce around consensus positions. This is historically true for the German position since chancellor Adenauer. With the Free Democrats in decline, and the Social Democrats and the Pirate party doing well in recent German elections and favoring consensus in Europe, Merkel's Christian Democrats need to rethink their policy to give greater weight to economic growth for a consensus position in Europe. ...

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The increasing likelihood that Greece will exit the eurozone. This happens as the New Democracy party fails to form a coalition and the other parties are offered a chance to form a coalition. The other opposition parties gained far more votes than New Democracy and Pasok in the elections and some parties favor Greece exiting the eurozone. New elections will be held in June if no government is formed. The current government of Lucas Papademos says it needs an extra year to complete the privatizations, public sector layoffs and improvements in tax collection, giving Greece till 2015 to get the job done. As a senior advisor to Papademos, George Pagoulatos, put it: "There is a sense that Greece has passed its pain threshold... Greece needs some oxygen to breathe." Both the Ifo Institute's Sinn and John Taylor see the exit from the eurozone as the best option for Greece, as interest rates on Greek debt have been reduced and Greek banks recapitalized with the March 2012 bailout. John Taylor, WSJ, Feb. 22, 2012, A Better Grecian Bailout/ WSJ, Feb. 17, 2012, Interview: Ifo's Sinn: In Greece's Interest to Leave the Eurozone.This may already be the preparation the IMF, ECB, EU, and the Greece government has laid out as an option if the voters in Greece overwhelmingly rejected further austerity. This now appears to have happened and far more quickly than politicians in Athens, Brussels and Berlin had anticipated....

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Inflation in the US went down slightly from annual rate of 8.5% in March to 8.3% in April 2022. Inflation was highest for gasoline, energy, automobiles and food. Supply chain bottlenecks have accelerated inflation in 2021-2022. The war in Ukraine has pushed up energy and food prices. Inflation is likely to ease in coming months. Wage gains are being eroded by higher inflation in 2021-2022.

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Sweden's currency, the kroner, appreciated by about 4% in March 2015. The central bank responded by lowering rates further from minus 0.10 to minus 0.25%, and added to earlier announced 10 billion kroner purchase of government bonds with an addition of 30 billion kroner.

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Analysts estimate a small impact of Japan's earthquake on the world economy. According to one estimate global growth would decline by only 0.1% to 4.2%, if the growth in Japan is flat, instead of 1.5%.

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Boosting vaccine production for the Indo-Pacific region that includes Bangladesh, Indonesia, Malaysia, Thailand, Philippines, Vietnam with production done through Biological E in Hyderabad will be discussed at the meeting with Biden. Japan will fund the project, and Australia will handle the distribution. This will be part of a followup to a March 12 virtual meeting of Quad leaders. This effort to meet the vaccine supplies challenge for the Asian region covering south east Asia and its population of 600 million will be one of the major outcomes of Quad countries collaboration, making it a peacetime collaboration that supports development in the region without burdening the financial position of any country.  The other part of US- Indian collaboration and Quad collaboration centers on two related themes after healthcare and pandemic. The immediate challenge is to tackle the breakdown in the supply chain for semiconductors. The US and Europe can no longer depend entirely on a supply chain based in Taiwan. The narrowest part of the Taiwan Straits which separates Taiwan from the Chinese mainland is only 81 miles wide, which makes continued dependence on chip production on Taiwan an unreliable option and the need to build a new supply chain for Japan, EU and US. Plans will be made to address this in the talks. The Biden administration has already taken action with Intel Corp making a U turn and bringing chip manufacturing back home to the US with $50 billion investment planned. India and other Asian countries may form additional options for semiconductor manufacturing. The third part of the Quad effort will center on US and Japan ramping up infrastructure building capabilities with India to build infrastructure across Asian countries and in Africa that will be financed in a way that will not have some of the liabilities of the Chinese initiative called Belt and Road. Loans given by Chinese state banks and contracts including manpower from Chinese contractors are now seen as not meeting the needs of Asian and African countries. These loans most of the time cannot be repaid as in Zambia, and other parts of Africa, and in Pakistan, leading to interest accumulating on debt and making future infrastructure development extremely difficult. The use of manpower from China also means no learning curve for infrastructure is formed for local companies and infrastructure comes without new jobs jobs being created.  For most of the period 1900 -1950 the British built Asian and African infrastructure. During the period 1950 onwards the US assumed a major role, as did the Soviets. This changed after belligerent Reagan administration policies and wars in the Middle East sapped the funds that could have gone to infrastructure building that would improved living standards in Asia and Africa. Mr Biden wants to see this change and this is what he meant when he said at the UN General Assembly today- " we want relentless diplomacy to take the place of relentless wars." He means every word of this and the diplomacy is between allies and also adversaries, but mostly with allies such as Japan, the EU and India to build a better world. That he has to do this quickly Biden is aware of that, which is why he said "the next 10 years will determine our future."   ...

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This self portrait by Vladimir Putin about his growing up years in Leningrad and the life of his father and mother during the siege of Leningrad by Germans may offer a better sense of the mind and thinking of the Russian president than the Dresden years when he was a junior Russian official in Communist East Germany (the GDR). It is an interview of the Russian president in 2000 by Nataliya Gevorkyan, Natalya Timakova, and Andrei Kolesnikov over twenty years back. Putin's father suffered severe injuries during the war in the fighting around Leningrad, twice being given up for dead and being dragged wounded across the frozen Neva river to a hospital by a neighbor. His mother was half dead from starvation and his father passed on his food given to him at the hospital. Having gone through the memories of this period affected Vladimir Putin's view of the world and no amount of US or German assurance about NATO's intentions may have erased these memories from childhood. The long period in power and the Covid isolation may have led to  perceptions that were less likely to change so that Putin did his own research and wrote a long paper on Ukraine in 2021 that reflected Russia and Ukraine's long history but did not reflect the changing national aspirations of Ukraine's people in 2022. This may have led to the miscalculation and the errors by both Putin and the leaders Merkel-Bush-Obama that the detailed WSJ report of 20 years of events show to have happened. The WSJ report of April 1, 2022, was titled "Vladimir Putin's 20 Year March to War in Ukraine and How the West Mishandled It." The Social Democrats in Germany under Schroeder and Steinmeier mishandled it by deepening economic integration with Russia as a way to make up for what had happened in the German invasion of Russia, and the Christian Democrats under Merkel with business interests never really grasped the different thinking of the Russian president relying solely on deep economic integration of the EU and Germany with Russia as well as China as an answer. Mr. Bush and Mr. Obama from a distance even less so.  This has led to the miscalculation by Russia under Putin leading to invasion of Ukraine, and the US and Germany being unprepared about taking action to prevent it.  Beyond the key participants and the war damage, there is the enormous damage that is taking place in the mental health around the world after Covid with constant barrage of images of war and refugees streaming into Poland. There is the problem of food imports, of food scarcity in the Middle East, and inflation in food prices for Africa and the Middle East. As Brendan Simms, a Cambridge historian has shown in his book "Europe The Struggle of Supremacy 1453 to the Present," which is now being read by German chancellor Scholz, this has happened before with the UK, Netherlands, Spain, Germany, Sweden, Denmark and Russia engaging in these conflicts that led to prolonged wars and eventually to only small shifts in power. Yet with huge effects for ordinary people caught in the wars such as today's refugees and people struggling to feed their families in Africa and Asia after the effects of Covid on income. Food prices have gone up by 50% to almost double in these countries.   ...

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The Health Exchanges set up under the Affordable Healthcare law (Obama Healthcare law) reaches 5 million by mid-March 2014. The Congressional Budget Office estimate is for 6 million enrollment in 2014 compared to a previous estimate of 7 million.

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The Bank of Japan's Governor Haruhiko Kuroda announces a massive monetary stimulus in November 2014, with a 33% increase in asset purchases, including government bonds and also stocks and real estate funds. The move was intended to get the maximum possible impact with the Nikkei Averages up 5% and boosting global stock markets. It is designed to make an affort to achieve the target of 2% inflation in 2 years announced earlier by Governor Kuroda. Slowing consumer spending with the increase in the sales tax to 8% was expected to lower growth in GDP for fiscal 2014 ending in March to 0.5%. At the same time inflation which had reached 1.5% was decelerating to the 1% level in September 2014. Faced with this problem and confidence levels in Abenomics dropping below 50% in polls, the BOJ and the Welfare Ministry acted jointly to support the economy. BOJ move is supported by a shift in the portfolio of the Government Pension Investment Fund, which will reduce purchases of government bonds and shift to higher investment in Japanese and foreign stock markets. The Welfare Ministry said it would increase its share of assets in the $1.2 trillion Government Pension Investment Fund for Japanese and foreign stocks each by 10 percentage points. Kuroda has insisted he will act strongly to fight Japan's "deflationary mindset." The vote to take the action was 5 to 4....

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A recent study by the IMF shows that China has accumulated foreign exchange reserves that are twice what would be needed for traditional purposes such as supporting the economy in a financial crisis. China is still very much a developing country with per capita annual income of $3000, low consumer spending, and rising inflation. This makes the policy of accumulating reserves and preserving an undervalued exchange rate to support export companies counterproductive. There is growing debate about this as inflation is becoming difficult to control. Yu Yongding, an advisor to the PBOC monetary policy committee says China as a developing country should not be exporting capital, which should be used to raise living standards. A rising exchange rate would increase spending power of people throughout China. Fan Gang, head of China's National Economic Research Institute, was a member of the central bank monetary policy committee. He wrote in a recent essay arguing for a higher exchange rate, and societal, tax and other changes that help increase China's household spending. Central Bank governor Zhou Xiaochuan said recently that China's foreign exchange reserves have exceeded reasonable levels that the country needs, adding to inflation risks and making it difficult to conduct monetary policy. The reserves are now over $3 trillion, pasing that mark in March 2011 after increasing 25% in the last year....

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A Defense Department biannual report that is mandated by Congress points to little improvement in the last 6 months in Afghanistan. In 92 districts studied for the their support of the Afghan government or opposition to it, not one supported the government. In 44 districts the people were neutral in this evaluation. The number of districts sympathetic to the insurgency increased to 48 in March 2010 from 33 in December 2009. Clearly the Afghan government of Karzai has little support in the country and this remains the major question: whether this war can be successful in the face of this fact and its continuance, and whether the merits of expenditure of time, effort, resources and lives to keep a government like this in power makes sense for America's security interests. About $6.6 billion is allocated by Congress for the training of Afghan security forces. But the Afghan police force consists of mostly illiterate and poorly trained persons and virtually nonexistent judicial system. Combine this with corruption, incompetence and threats and this force is really ineffective. Overall the Afghan security forces once trained don't appear from this report to be able to sustain themselves in the face of an insurgency whose "operational capabilities and organizational reach are qualitatively and geographically expanding", and with "strength and ability of the shadow governance to discredit the authority of the Karzai government increasing."...