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Because there is no cash available in financing these days, the few deals in commerical real estate aare like this one in Birmingham, Alabama. An office building there aold for $147 million, but the buyer put up only $1.3 million. See the link to the report by Conway of the Fed's Rapid Response program on the danger to 45% of commercial loans that are expected to sour in 2009. And the WSJ analysis on the risks facing 800 banks with heavy real estate exposure.

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The German and French positions on solutions to the eurozone debt crisis are in conflict. As a result the negotiations between France's Sarkozy and Germany's Merkel are deadlocked. The basic differences revolve around three basic issues. Germany wants to see a lasting solution in which Greece debt is restructured so that banks and other creditors that loaned money to Greece voluntarily take losses so that Greece's debt can be reduced to a sustainable level of no more than 50% of what it is now. France, the ECB and the French banks do not want to restructure Greek debt in this manner beyond the 21% reduction in value of debt under the July 2011 agreement. The voluntary reduction in Greek debt by the banks would prevent a default by Greece and unsettling of the financial markets. France fears market contagion from the restructuring of Greece debt that would place pressure on French banks as the value of the Greek, Spanish and Italian sovereign debt French banks hold declines in value. That would require a major recapitalization of French banks and additional cuts to the French budget. Additional twists to the negotiations are that Sarkozy is unpopular in France with elections six months away. For this reason Sarkozy would prefer to recapitalize after 9 months. A way to get around the need for more deficit cutting (austerity measures) in France, is for the European Financial Stability Fund to be able to borrow money from the European Central bank. The ECB can print euros in that situation. Germany's chancellor Merkel has to consider German public opinion and experts from the German central bank, who are adamantly against using the ECB to print money and Germany committing itself to bankrolling most of the effort. Germany wants France to use its own money to recapitalize French banks, with Germany only responsible for recapitalizing its banks. Merkel told her parliamentary caucus in Berlin that "the path is closed for using the European Central Bank to ease liquidity problems." Because of Germany's insistence on financial soundness for any solution, France being in the more difficult financial position and Sarkozy facing elections willing to come up with a short term fix, and the unwillingness of French and German banks to take the losses necessary for a lasting solution, the Germans see a real solution taking a long time. ...

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Allan Meltzer, a former economic adviser to President Reagan, and an expert on monetary policy at Carnegie Mellon School of Business says that "this is scare tactics to try to do something that is in the private but not the public interest, its terrible." Vincent Reinhart a former Fed economist says Paulson has lost credibility, people don't believe him anymore. And Elmendorf of the Brookings institution says that taxpayers should get more out of this deal with ownership stakes in the companies that use government money. Others like Bruce Bartlett, a former White House economist under president Reagan say the problem is nobody knows what the hell is going on and there are some naive assumptions about how this would function. Martin Bailly, a former chairman of the Council of Economic Advisors under President Clinton says for financial institutions to take the funds Treasury has to pay a premium because otherwise they would have sold already. While Bernanke told the Banking Committe that the government would pay more than the distressed prices to get broad participation which is a goal of Treasury and the Fed, neither he nor Paulson could reassure the committee about how taxpayers would be protected. Most of the economists surveyed here by the NYT are skeptical about a Wall Streeter from Goldman Sachs credibility on this as they see him paying financial institutions a premium price. The sore point in all this for the taxpayers and the public would be that the Bush administration has done nothing to help homeowners with foreclosures that are also at the root of the problem when you look beyond the immediate clogging up of the financial system and present a threat via declining home prices. And Paulson now offers a plan that also is very hazy about protecting taxpayers with equity ownership or some other protections, and has nothing to assuage the public's outrage about ceo compensation in the midst of distress. Not just the Banking Committee but experts from all sides of the political spectrum are raising concerns stressing one or other of these points, and find the lack of details in the Paulson Bernanke plan a sign of a hastily put together plan with little research even considering the lack of time, and the lack of any details a strain on people's intelligence for a proposal of such magnitude....

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As the old rules are being rewritten or changed there is considerable ambiguity about the new nuclear rules for India and Pakistan, says The Times. This happens as Mr. Trump is distracted by the international problems such as North Korea and Venezuela and the Mueller probe into Trump and the election of 2016, and as UK prime minister May is distracted by Brexit. 

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GM's joint venture with Luizhou Wuling Motors has produced a win-win situation for both companies. Wuling was a small, regional manufacturer when the joint venture started. Now Wuling has more than 1 million in unit sales. And GM has benefitted from the rapidly growing sales. Year over year sales were 29% in 2010, and were slowing to 10% in 2011, with the end of government incentives. Wuling vans can now be sold under the GM brand in India, using lower cost manufacturing in China. Looking back this was good for GM. The future however has some twists and turns and could turn out to be different. Wuling joint venture will produce cars at a lower price point under the Baojun brand. These cars were shown at the Shanghai Auto Show, and will be marketed to customers who are looking for affordable cars in the second and third tier cities in China. The Baojun brand joint venture will have one difference. This brand involves intellectual property being held in common with Wuling Motors. This is part of China's new plan for American and European manufacturers in China- the price of access to the Chinese market is greater technology sharing with Chinese partners. In the long run this should enable Chinese manufacturers to be dominant inside China. This process is already underway. According to J.D. Powers, Chinese brands had 32% of the domestic passenger vehicles market in 2010, up from 18% in 2000. Something similiar happened with Japan, where Nissan was making Britain's Austin A40 series in the mid-1950's. By the 1960's the foreign tieups were replaced by Japanese manufacturers dominant in the home market and exporting their own models. ...

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Hernandez and Qin provide this exceptional account of the thoughts and feelings of the 150 million young people in China who are single children of parents, through intervews and description of this generation in Chinese media. Local media calls this generation very lonely because of the lack of a brother or sister, without cousins, uncles and aunts. These children were doted on by their parents and have grown up in an unususal way because of the extraordinary attention they received- unlike what is happening throughout the rest of the world. Were they lucky? Not really, because they now have to face the burden of supporting aging parents alone, without the help of siblings. And for the policymakers there is another shock of realizing that such a precipitate action of a one-child policy from 1990 onwards may have undermined other goals by creating a rapidly aging population and shrinking workforce to support them, especially when Latin America and other poor countries with high birth rates have seen these birth rates plummet over time as living standards and education improved. A 2013 study by Australian researchers shows these children having tendency to show selfishness, pessimism and risk aversion. The other shock for policymakers is that the cost of getting a good education and the scarce number of places in good schools, is leading parents to not have that second child. ...

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Harris call for FDR's "bold persistent experimentation" at Carnegie Mellon in Pittsburgh, old industry brought back to life, harks back to this era that saw FDR rescue not just Pennsylvania, but the whole nation, and led the way to JFK and now to Harris, for America to strike out for a bold new path to the future, with a bold vision like no other nation. Harris has said she will bring back the days when Pittsburgh and its surrounding areas were the envy of the world and America had the leading steel industry.   Charles Mcelwee looks at Roman Catholic country in northeastern Pennsylvania in Politico. Everyday working class issues matter here in Lackawana County and FDR still brings back memories in this part of the country that was left behind by all former presidents before Biden from Scranton in this part of northeastern Pennsylvania came to it's rescue on working class issues- around wages, families and neighborhoods, and the neighborhood church. Harris brings her own dedication to these issues as a devout public servant in the same way as John F. Kennedy who campaigned in these same working class neighborhoods drawing on Irish Catholic support and support of coalminers. Northeastern Pennsylvania is home to Lackawana County and Luzerne County, counties which are coal mining country from the 1930's which were key parts of the New Deal coalition of working class people and Catholics, put together by Franklin Roosevelt. But these family ties to the many churches in the area have eroded as churches closed in the last 3 decades, and as the coal industry and the steel industry declined. The tendency of people to go to church every weekend has also declined. As a result no one really knows how the people here will vote, will they vote with other Catholics or will they vote for who can do the most for working class families, increase wages and benefits for workers and protect workers.   ...

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Annalena Baerbock, 44 years, of the Greens is Germany's nominee for president of UN General Assembly in 2025. She was nominated by chancellor Scholz. As a leader of the Greens and in the coalition government of chancellor Scholz she has tried to show that Germany is a modernizing nation and innovative more than is seen in its political class. As one of the youngest politicians she has presented Germany in a new way as a young face for Europe. DW.com shows the evolution of the Greens as a party since the 1980's. Baerbock joined the Greens at age 25, four years later in 2010 she was head of the Brandenburg state section of the party, becoming a board member of the European Green party. She is still only 44 years old. She studied public law and political science in Hamburg, and gained a Masters degree in international law at the London School of Economics, one of Germany's first leading politicians to study in Britain. She started studies for a Doctorate at the Free University of Berlin, which she left in 2013 as she was elected to the Bundestag. By 2021 Annalena Baerbock was with Robert Habeck co-leader of the party heading into the general election. At one point the Greens were polling 5 months before the 2021 election at 27% with Annalena Baerbock running for chancellor against Armin Laschet of CDU and ahead of the CDU by 3 points in Sonntag poll. The Greens came in at 15% of the vote in 2021 dropping slightly to 12% in 2025. This time the Greens will sit in the parliamentary opposition headed by Robert Habeck. ...

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In a significant development Apple plans to introduce a new iPhone in 2011 at half the price. The new iPhone will be lighter and about half the size of the current model, the iPhone 4. The reduced price would make it possible for Verizon and other carriers to subsidize most of the retail price. Apple at the current time sells iPhones to Verizon and other carriers for an averge of $625 each. A subsidized iPhone can then sold near the price point of $200 with a two year contract. Also in the works is a big revamp of the MobileMe online storage service. The service allows users to access data from a central location, and is sold for an annual subscription fee of $99. This feature gets rid of the need for a lot of memory residing on the phone itself. MobileMe would also be used for online music, social networking and other purposes. These two projects, the mass market iPhone and the new MobileMe are the two top priorities for Steve Jobs, who is still overseeing the efforts from home. Jobs went on medical leave recently. The global market share of the iPhone is only 3.4%, according to IDC. Yet it generated 39% of Apple's $26.7 billion in revenues for the last quarter of 2010. Apple's strategy is to accelerate competition in the smartphone segment. IDC says global sales of smartphones will rise 39% in 2011 to 421 millon units. Apple has sold 84.2 million iPhones since the introduction in 2007. By entering the massmarket with a better iPhone and free features on MobileMe Apple hopes to make significant inroads in 2011-2012....

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Chapman points out that the Phillips curve did not hold in low inflation years since 1948 when low inflation was accompanied by low unemployment and higher growth rates. It did hold in the higher inflation years after 1948 when higher inflation was accompanied by high unemployment and low growth rates. So can the Federal Reserve hold onto the idea of a Philips curve hoping that higher inflation will somehow lead to lower unemployment and higher growth as it lowers interest rates. What it may end up doing is hurting the dollar, while increasing inflation and leading to lower growth. Without the demand for Treasurys the way there is now because of the confidence in the dollar, interest rates would rise and domestic savings would be diverted to service the debt, and output would be lower and prices higher. McKinnon at Stanford and others have been arguing the case for a strong dollar in the WSJ recently. Chapman is accepting that interest rate cuts may help the economy but only by a little bit in the current situation and temporarily because there are too many forces at work pushing the economy into recession. So the comparitively small dividends from interest rate cuts should not be allowed to give up the bigger dividends from having international confidence in the dollar not erode. Especially as the current market imbalances cannot be fixed by the mechanism of interest rates, and its not the Fed's job to fix the considerable challenges facing the economy today which will take time to work out and require political leadership from Congress and a new President....

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Mr. McDonnell, says to loud applause at the annual Britain's Labor Party conference in Liverpool- "the greater the mess we inherit, the more radical we have to be." Mr. McDonnell told the Labor Party that the power balance had shifted against labor and workers in the last decade. The Brexit Secretary of the Labor Party left the option open for a second referendum on Brexit with the option "remain." Serious divisions have emerged within the ruling Conservative Party in Britain on the issue of withdrawal from the European Union. For the first time the Labor party conference endorsed the idea of nationalizing utilities, postal and rail companies and setting up a fund that would finance a $650 annual dividend for workers, with 10% of stock reserved for workers in companies with more than 250 employees. About a third of the seats will also be reserved for labor on company Board of Directors so that worker interests are better represented. Stagnating wages and low productivity is a major issue for the Labor Party in Britain. Mr. John McDonnell, as economic leader of the Labor Party, cited the words of the Archbishop of Canterbury, critical of the current situation with stagnation and low wages, lack of upward mobility. ...

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The head of failed bank HBOS or Halifax Bank of Scotland, which needed $17 billion of British taxpayer money, and was merged with Lloyds Bank after heavy losses, is Sir James Crosby. In a strange turn of events he ends up as a trusted advisor to Prime Minister Brown and becomes deputy chairman of the Financial Services Authority, Britain's regulatory agency. Sir James obviously knighted, obtained the appointment to FSA in 2006 when HBOS was growing rapidly, the losses came in 2008. But just as in the USA some of the people who were in the financial institutions or in regulatory agencies where alot of bad judgement or lack of necessary fiscal prudence was exercized, are still in positions that have as their principal task getting the US or Britain out of this crisis in financial institutions. In this case a House of Commons' committee investigating the banking crisis released written testimony that Sir Crosby summarily fired one of his executives Paul Moore after warning that HBOS bank was moving too fast in acquiring billions of dollars in new debt. One line in the Moore testimony is telling in its description of what happened at HBOS, as it must have in a host of other places in the US and Europe: " Sadly, no one wanted to speak up for fear of stepping out of line with the rest of the lemmings who were busy organizing themselves to run over the edge of the cliff behind the pied pper CEO's and exectuive teams that were being paid so much to play that tune and take them in that direction." End result, Crosby resigns his position before Prime Minister Brown is embarrassed and faces tumult and questions in the British House of Commons....

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Trade in services is not enough. Services won't build ships for the US Navy. Services don't provide jobs for factory workers. Trade in services won't rebuild the US manufacturing base. It won't rebuild the middle class. Trade in services won't make pharmaceuticals Made in America that are available always, including in times of war, pandemics and disruptions. Bottom line as DJT pointed out in a Cabinet meeting on April 10 is that the US could no longer be a world power without its industrial base, it's manufacturing base. Americans companies doing the outshoring are really the targets of the Tariffs because they are at the heart of the mechanisms causing the destruction of the industrial and manufacturing base of America, vital for it's security and for it's leadership of the free world and western civilization. It started with Apple in 1998 and I witnessed this as a consultant seeing the production line at the Apple Colorado Springs plant in 1997 with rework and defective product before Steve Jobs returned to Apple. By 1998 Apple started shipping it's entire production base to China. DJT told the Cabinet meeting on April 10, 2025, all previous presidents had to tell companies firing all their workers and outshoring their machines was- "there will be a tariff of 50 or 100% on your products imported into the US."  And these companies would never have fired all their workers and sent their factories to China or some other country. Economists and experts who have turned their backs on American workers see the $1 trillion deficit countries have with China and the loss of their industrial and manufcturing base with one excuse or another. Trade in Services in which the USA has an advantage does not do much for American workers, or for the 5 million manufacturing jobs lost and tens of thousands of factories that have been outshored.  National Security and Jobs, the Middle Class, factory communities across all 51 states are all at stake. ...

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Risks to the economies of western Europe through the banking system and its lending to Eastern European economies are growing. The Easter European economies that are collapsing are Europe's version of the sub prime crisis in the USA. This may ricochet back to the United States as European institutional investors pull money out of the US stock market. Europan banks could suffer a further increase in nonperforming loans, and need further recapitalization from their governments, which are already hardpressed by demands for shoring up the social safey nets, stimulus spending and bank rescues. Big institutional investors in Western Europe, the banks, pension funds and insurance companies, hold large amounts of Eastern European debt, and further infusions of capital from western governments would put increasing pressure on the Euro.

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The US Justice Department has its case against Google- US et al v. Google. 

Ms. Wood said in the U.S. District Court for the Eastern District of Virginia.

“Google is not here because they are big, they are here because they used that size to crush competition.”

US says Google rigged the rules to profit immensely from the arrangements it made after acquisition of Double Click in 2008, so that it controls every link in the chain for the software that sells adspace online, Ms. Wood for the US told Judge Leonie Brinkema on September 9, 2024.

Tech monopolies have acted in ways that have hurt the interests of the American people, in a way that Big Pharma, Big Oil, and other industries have acted to focus on profit at the expense of The People of America.

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Beppe Severgnini is a columnist for Italy's newspaper Corriere della Serra. Here he describes the rift between generations in Italy that is holding Italy back.

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Daniel Howes of the Detroit News thinks there are cultural clashes inherent in a threeway Fiat-Opel-Chrysler combination. His view is that Fiat may be biting into more than it can handle, considering the failure of the GM-Fiat alliance, and the Daimler- Chrysler combination. And the Germans at Opel are not happy with the way they see GM has treated them, so how would it help for Fiat to come into the picture? The Germans love the Italians, says one German Howe talked to, but don't respect them. And the Italians he says, respect the Germans but don't love them. Howe refers to the Renault-Nissan combination as successful, but one that took years to build to deliver commonly engineered cars. But the car industry has been poorly run, without vision and with complacent management, unwilling to try new things and recreate and renew. In other industries efforts are made to build transnational combinations with differing degrees of success. Take the work of the French, Germans and the Spanish in Airbus, in overcoming different cultural factors and pulling together to learn from each other, when given good leaders, on the Airbus 380 project. See the link to this. On Fiat's Marchionne's behalf it could be said that this is a new Fiat, run by a younger generation of Italians, who have a lot of youthful energies and freedom to innovate and improvise. Marchionne himself is more Canadian and European, places where he has spent most of his life, than Italian. And he has take a decidedly different view of things from what the old view holds as being Italian, in building the new Fiat he has done things very differently. In fact there may be less of a country view here, than a management culture view. All nationalities aspire to a good management culture of innovation, and freedom to improvise and respect for one's ideas and thinking, good places to work in. People of all nationalities, Italian, German and American, for the first time, especially the younger people, may see that the one thing they value most and share is the desire to start fresh and take initiative, improvise and work together to do the impossible. The common enemy of Germans, Italians, Americans,French, and other nationalities, may be simply the artheroschelorisis of complacent management, that freezes initiative, does not delegate more responsibility to the young and give the freedom to try new things, bureacratizes the corporation into rigid hierarchies that lack speed, and take no risks to achieve the impossible. See the link to Marchionne and Fiat's transformation. Which is why old prejudices like the one Howe states from one German he talks to, that the Italians "will steal the milk out of the coffee," may be just that - prejudice from another period, that is best left behind to build something new that has no nationality to it. ...

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This NYT report by Eric Schmitt describes the efforts of U.S. troops in Europe under Lt. Gen. Frederick Hodges to build  a fast movement capability to counter the threat from Russian forces on the borders of countries in Eastern Europe. Hodges says speed of movement is crucial. American forces are deployed in smaller numbers than the Russian forces. A 10 day exercize under Hodges involved 25,000 American and allied forces across Hungary, Romania and Bulgaria. Russian forces exercizes involve more than 100,000 troops. The war in Ukraine involved a breakaway region in the east supported by Russian forces.

Commanders and younger officers were trained to address the Cold War threat with the soviets. Then for over a decade the focus shifted to Afghanistan, then Iraq and Syria. Now the focus shifts back to the Eastern European area with a new Russian threat.

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Growing the banking business right into the 2008 financial crisis - with the effects of the crisis playing out over the next decade- is one decision GE CEO Immelt has described as one he didn't do right. Moves in 2014 and 2015 were designed to focus GE on areas of its historic strengths. GE plans to sell $26.5 billion of office buildings and commercial real estate debt to Blackstone Group and Wells Fargo. This is after moves to spin off the private label credit cards and retail finance business as a separate company called Synchrony Financial. Most of GE Capital's $500 billion business will be sold off or spun off in 2015-2016, except for aircraft leasing and financing for energy and health care, which are related businesses. GE shares were up to $28.38, up 10%, in trading on April 9, 2015. GE Capital's shares were down to $6 in the 2008 financial crisis requiring an injection of government funds. Immelt's 13 years as CEO would end on a positive note with this move, as the role of GE Capital in contributing to the crisis is considered a blemish on his record....

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U.S. president Obama visits Saudi Arabia in April 2016. President Obama presents arguments for forging "a cold peace" between Iran and Saudi Arabia after proxy conflicts in the Middle East. During the visit president Obama will encourage dialogue between Iran and Saudi Arabia, at a time when Saudis are skeptical about U.S. policies in the region. Saudi Arabia has reduced the economic gains to Iran from lifting of sanctions and entering the oil market by ramping up Saudi production to bring down prices. The situation also affects Russia and Venezuela.

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Italy's borrowing costs increased by one percentage point one week after the July 22, 2011 eurozone debt deal for Greece. The Italian Treasury sold 2.7 billon euros of 10 year bonds with a yield of 5.77%. The yield in late June for a similiar bond issue was 4.94%. Yields on Spain's 10 year bonds increased to 6%. German bonds are getting investors with a 10 year bond yield that has decreased to 2.62%, which means the gap between the German bonds and the bonds of southern European countries is widening.

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New Basel III rules for global bank reserves. The talks held by the Basel Committee for Banking Supervision are expected to lead to larger capital requirements for global banks, than banks had earlier anticipated. The requirements will be for larger cushions in the anticipation of crises, and reserves of higher quality. The requirements would require banks to hold common equity equivalent to about 4.5% -5% of their assets, and an additional 2 -2.5% during better economic periods. It banks do not issue stock they would keep more of their retained earnings.

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The government created a$5 billion fund to guarantee payments to auto parts suppliers for products shipped to car companies. This stabilizes the auto parts companies which are finding it difficult to access credit and have late payments from car companies. It ensures money for payrolls and other expenses. And autoparts companies receivables can now be sold to the fund so that thye have more liquidity. It also generates more confidence for the auto parts sector that they can survive the difficult conditions facing them and be asteady source of parts for car companies.