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The President of the American Chamber of Commerce, Harley Seyedin, says that the days when migrant workers did not know their rights, labor laws were not enforced, and factory owners could keep wages low, are gone. With 787 million mobile phone users and 384 million Internet users- which includes migrant workers who can now get the news about the latest developments, send messages, video, and access the internet. For its part the government made serious effort to create awareness about new labor laws of 2008 through the state run media outlets. And workers have greater awareness and understanding of their rights for safe working conditions and double overtime pay, as well as other rights guaranteed in China's new labor laws. And something else is happening that connects the universities with workers. The expansion of the number of students at Chinese universities has brought more people from rural areas into the universities. This has created sympathy and support for migrant workers at the universities. Nine sociologists at Peking and Tsinghua universities signed an open letter calling national and local governments to implement actions that let migrant workers integrate into the city environment and share in the country's progress that they are creating. The government's security system has prevented the creation of a worker's movement in the past. But this time the government may be thinking of the need to develop China's domestic market, as the reliability of markets in the USA and European countries is uncertain as economic conditions change. For this to happen China's workers need higher wages to buy the goods China produces. ...

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This Journal editorial says both Hollande and Sarkozy fail to address the issue of competitiveness in the French economy. Much of the election campaign in April 2012 has focussed on taxes on higher incomes and too little on measures that would improve competitiveness. Some of the action taken in recent years such as raising the retirement age to 62 from 60 are being opposed by Hollande, which gives the electon a fairy tale quality says the Journal.

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The uncertainty generated by the "fiscal cliff" in the U.S. is hurting the U.S. economy as businesses hold off on investment and hiring.

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Shiller says the underlying problems in the economy such as the sociological factors that led to overoptimism about real estate prices and the dot com stocks play out over many years. They are lost in the headlines about the Fed or some short term developments that get cited along with the bad economic news about unemployment. Yet these underlying factors such as the bubble phenomena in housing are what makes these problems so intractable. The bubble in home prices caused a 131 percent rise in home prices in the period 1997-2005, 85% in inflation adjusted terms, according to the Case-Shiller National Home Price Index. The long term expectations of price increases well into the indefinite future lag the price decreases as the bubble bursts, even as the expectations decrease. For 2012 the Case-Shiller survey shows expectations are for a 1% increase in prices. With the increase in the personal savings rate from about 1% in 2005 to about 5% today, Shiller says consumer spending will not support a strong recovery....

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This article in the NYT explains why the loss of jobs particularly in the auto industry to Mexico, with the experience of NAFTA passed by president Bill Clinton, has caused widespread opposition to the TPP trade agreement proposed by president Obama. Both Hillary Clinton and Donald Trump in 2016 oppose the TPP.

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Japan's vice finance minister for international affairs, Mitsuhiro Furusawa, emphasizes that Japan's effort to revive the economy is exactly what the IMF and the international community have been looking for Japan to do. The effort is designed with the primary objective of fighting deflation. The yen has declined by 15% since the new administration of prime minister Abe assumed power Dec. 26, 2012. It now is at 99 yen to the dollar compared to 80 yen to the dollar in 2012. At 80 yen to the dollar the IMF considered the yen "moderately overvalued." Furusawa assumed the new position recently. His previous position was IMF executive director 2010-2012. In that position he assisted IMF managing director, Christine Lagarde, in efforts to manage the sovereign debt crisis in the eurozone.

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The Economist points to Mexico's potential and compares it favorably to Brazil and China. Mexico's people are better educated and have higher standards of living than most developing countries including Brazil. Technical education is one of Mexico's strengths and it has good management talent. It suffered badly in the global financial crisis of 2008 because of the recession in the U.S., but it does not have to lower its sights and live with lower growth as the U.S. economy suffers a slowdown. As Chinese wages have risen, Mexico is looking better as a place to invest. And even as Brazil's credit markets getting overheated, there is much room for credit growth in the Mexican economy. Mexico could achieve a growth rate higher by about 2.5 percentage points according to one estimate, if it attracts more foreign investment and opens up the oil industry to foreign investment, implements reform for labor markets and opens up many sectors to competition. It needs to restricts the monopolies granted to businesses such as Telefonos Mexico run by Carlos Slim, as well as other cartels and monopolies to achieve higher economic efficency....

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This WSJ editorial says prime minister Abe deserves to continue his efforts to revive the economy after Abe calls a snap election for Dec. 2014. It says the Finance Ministry's ideas for increasing spending and taxes have not worked to win over deflation. It points to the need for prime minister Abe to take supply side actions and get the Third Arrow of structural reform to work.

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In this Agenda column Simon Nixon takes on the U.S. Treasury's criticism of Germany for its current account surplus of 7% of GDP in 2012, and not doing enough for the economies of southern Europe. The German government called it "incomprehensible." Nixon says it is better for the German economy to remain strong and to boost competitiveness and consumer spending in Spain, Portugal, Italy and Greece. He says the low eurozone inflation of annualized 0.7% for September 2013, which prompted the ECB to cut rates by 0.25%, is healthy to the extent that consumer prices are declining to adjust to a decline in wages. The reduction in labor costs is a way to restore lost competitiveness, just as Germany did in the last decade. The criticism is considered by many economists to be misdirected, and seen as "incomprehensible" by Germans, as Germans ask what would the U.S. have them do- provide stimulus when the government debt to GDP ratio is currently 82%, increase wages and how would this help Southern Europeans. Focussing on Germany's current account surplus says Nixon, is obscuring the larger issues of increasing consumer and business confidence and spending in the eurozone, and increasing bank lending. The new ECB bank resolution arrangements and other changes including deposit insurance if done right should help the recapitalization and restructuring needed for restoring bank lending to support recovery. Spain is furthest along in regaining competitiveness, with changes in Portugal, Italy and Greece also supporting a gradual return to growth....

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The author Li Congjun, is head of the Xinhua News agency, official press agency of the People's Republic of China. He calls for rebalancing the global economy with China depending more on domestic consumption, efforts to restrain the excesses of property and asset price bubbles, and renewed focus on technology and investment.

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The International Energy Agency lowers its global oil demand forecasts on Dec. 11, 2014, leading to further drop in the price of oil with oil futures in electronic trading for WTI at $58.89 on New York Mercantile Exchange, and Brent crude at $62.83 on ICE in London, for January 2015. The price of WTI U.S. oil dropped to $59.95 on Dec. 11, 2014.

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Two weeks after his election Donald Trump says the U.S. will not join the Trans Pacific Trade Agreement during his term in office. Barack Obama took seven years to negotiate the trade agreement which was opposed by trade unions, the auto industry and was unpopular in the midwestern U.S. because of the impact of trade in hollowing out the manufacturing sector. Here Frank Sieren of the DW.com points out that the agreement was not really about trade, as most of the gains of trade had already been realized according to experts. It was part of the "pivot to Asia" to maintain American dominance in the region, says Sieren. After China pulled together some Asian and European countries into its trade agreement, the Regional Comprehensive Economic Partnership (RCEP), the U.S. pushed for TPP as a counterweight to the China sponsored trade zone. China says it will try to integrate the countries in TPP into the trade zone it has sponsored. President Trump has said that the U.S. is better off negotiating agreements with each country and not getting into multilateral trade agreements. He fought the election campaign on the basis of the opposition to TPP and trade agreements that unfairly hurt American workers. This could have provided the 110,000 margin of victory in the states suffering from the hollowing out in manufacturing such as Michigan, Wisconsin, Ohio and Pennsylvania. A similar hollowing out in Ontario favored Justin Trudeau's Liberals against the Conservatives in Canada's election. ...

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Elelven of twelve Fed Governors support the U.S. Federal Reserve's decision to keep rates low till unemployment falls below 6.5%, as long as inflation remains subdued at 2-2.5% and inflation expectations are low. Only the Fed governor of Richmond expressed a dissenting vote. The Fed in its policy statement said it was addressing the problems of the last three years in housing and joblessness. Charles Evans of the Chicago Fed put it this way in a Sept 2011 speech- suppose the inflation rate was 5% when the target was 2%, then central banksers at the Fed would have acted as if their hair was on fire to tackle inflation, then why shouldn't the Fed do the same for unemployment. He succeeded in convincing Bernanke, Yellen and other Fed governors. Bernanke emphasized the enormous cost in human potential and productive capacity of the U.S. economy from high unemployment and people dropping out of the labor force.

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Moritz Kramer, a managing director at S&P, says Spain, Italy, France and Portugal cannot depend on austerity measures and cuts in spending alone to resolve the eurozone crisis. This is only one aspect of the problem facing the countries in southern Europe. The major reason for the problem is the lack of competitiveness in their economies. Nobel winner Stiglitz also points this out and adds that its important to note that the human and natural resources of Europe are the same and the potential just as good today as before the eurozone financial crisis. He says southern Europe has failed to utilize its human and capital resources and improve its technologies in ways that would make it more competitive with Asian countries. Experts point to the decade it took Germany to address problems created by inflexible labor markets, wage competitiveness, and investments in technology and human resources to get to where it is today.

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Young people in India express their rising expectations for the next government- for better infrastructure, for jobs and better incomes and a better vision for the future. Narendra Modi, leader of the BJP party and chief minister of Gujarat state, gives the development and high growth rates in his state as an example for what can be achieved in the the rest of India.