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BUSH AND E85- ITS UPTO MARKET ECONOMICS, NO DIRECT ACTION AS IN BRAZIL. U.S. oil companies are skeptical about E85 and are not investing in pumps and filling stations. Only 800 of 17,000 gasoline filling stations in the U.S. have ethanol. Unless required to do so station owners are not likely to invest thousands of dollars in ethanol pumps. In Brazil the government took direct action to promote ethanol use, giving sugar cane companies cut rate loans and guaranteed prices for the product, and it required state run Petrobras to make ethanol available at filling stations. The cost auto companies say in this article is only about $100 extra per vehicle for extra anticorrosive materials and computer sensors for ethanol capable cars. With market economics and no direct government action the picture is fuzzy how the whole E85 project is going to come out.

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Under UN Convention on the Law of the Sea, natural islands or rocks are given territorial sovereignty going out 12 nautical miles, but no such sovereignty exists for reefs that are submerged in high tide. Two U.S. B-52's fly within 2 nautical miles of the Cuarteron Reef in the Spratly Islands in late Dec. 2015, about 600 miles south of Hainan Island in the South China Sea. China claims control over the South China sea navigation routes through its reclamation work in the seven rocks and reefs in the Spratly Islands. The U.S., Japan, India, Vietnam, Philippines and other countries say these are international waters and form key navigation routes from the Indian Ocean to the Pacific Ocean for global shipping. In late October 2015, a U.S. Navy destroyer sailed within 12 nautical miles of another island built by China in the Spratly Islands.

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David Albright, a former weapons inspector in Iraq, says 24 days is enough time for Iran to wipe out traces of nuclear work, such as working with explosives to trigger a weapon or construction of a small plant to make centrifuges. A situation actually happened in 2003 when the atomic energy agency wanted to inspect the Kalaye Electric Company site in Iran in 2003, where Iran was using centrifuges received from Pakistan. Iranians removed all traces of illicit work at the time while delaying inspectors. This case was cited by Olli Heinonen, a former deputy director of the agency. Heinonen says smaller scale activity such as manufacturing uranium components for a nuclear weapon can be carried out and the traces deleted in 24 days. Senator Corker points out that the time allowed would be more than 24 days when all the time is added up correctly.

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The Indian Finance Minister Mukherjee presented his new budget and talked about the new administration's plans for investment and its priorities. The Rural Employment program which guarantees 100 days of work to each indigent family will get an increase in funding to $8.1 billion or 391 billion rupees for this fiscal year. THe goal was set for cutting in half the percentage of the people in India that are poor in five years, which the government measures by calories consumed. The Indian government estimates that 27.5% of Indians were poor in 2005 using this measure. To finance investment government spending will increase 36% and the deficit for the 2009-10 fiscal year will reach an estimated 6.8% of GDP, up from an estimated 6.2% in 2008. Abig part of this spending will be increases in infrastructure spending which will go up from 6% to 9% of GDP by 2014.

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Krauthammer quotes Congressional Budget Office Director, Elmendorf, who said "we don't estimate speeches," when Elmendorf was asked about President Obama's April 13 debt plan speech. President Obama has failed to come up with specific ideas for debt reduction and not taken up any position on debt reduction, including removing tax expenditures as recommended by the President's Bowles-Simpson Commission report. Krauthammer says the President is using the discussion on debt reduction and the debt talks as a way to move forward with his reelection campaign. This President Obama has done by not putting forward any new ideas of his own or backing the ideas of the Bowles -Simpson Commission, and by putting Republicans on the defensive for coming up with any new ideas which may be unpopular. He calls the President's February 2011 efforts on debt issues a farce, and the April 2011 efforts empty, lacking any substantial specifics.

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Republican presidential candidate Rick Perry said in a nationally televised debate with Mitt Romney, Jon Huntsman, Michelle Bachmann and Ron Paul, that "maybe it's time to have some provocative language in this country." He did not hesitate to call Social Security "a monstrous lie," and a "Ponzi scheme." He said making economic decisions on the basis of climate change science is "nonsense," saying Galileo got outvoted for a spell. And he had this to say about Obama, Rove and Bush. About Obama- "has some of the poorest intel of a president in the history of this country, or he was an abject liar to the American people." About Karl Rove- "Karl has been over the top for a long time in some of his remarks, so, you know, I'm not responsible for Karl anymore." And Bush- "I don't think America needs to be in the business of adventurism."

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Same store sales continued to drop for the fifth consecutive quarter for Best Buy electronics retail stores. Best Buy shares have declined by 32% as of September 14, 2011. Best Buy has 1,100 stores in the U.S. and competes with online retailer Amazon for electronics sales. Investors see Best Buy management's plans to reduce square footage by 10% as too slow a response to a developing crisis for big store sales. Best Buy CEO, Brian Dunn, says about 40% of online purchases from Best Buy are picked up at its stores. He sees a role for retailers with physical store space because, as he sees it, customers still want to see, touch and feel the latest tablet or other electronic gadget. Critics say customers are prone to use the stores to look at products, and make the actual purchases online at Amazon, where no sales tax is paid.

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Hitachi supplied signalling technology components for safety on China's high speed trains. Hitachi was the supplier to Beijing based Hollyss Automation Technologies Ltd., which is one of the two suppliers along with China Railway Signal & Communication Corp (CRSC) for the signalling equipment. To protect its proprietary technology from competitive threats Hitachi uses zumen or "black box" so that the components cannot be reverse engineered. Experts say that as a result Chinese engineers did not have a good grasp of how crucial aspects of the safety tecnology worked, leading to the collision of two bullet trains in 2011. The key components of the ATP, the Automatic Train Protection, the onboard brain on the trains, was supplied by Hitachi. Engineers at French company Alstom SA's China operations say China needs time to master the complicated technology acquired in the last seven years of the high speed rail program.

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Prime minister Mario Monti responded with humor to the remark of former prime minister Berlusconi before the June 2012 summit of European leaders that he could unplug the Monti government, by saying that his government was not a home appliance. In August Monti's long intervew with the Wall Street Journal is published in which he says the Italian bond spreads with German bonds would be 1200 or something if Berlusconi was still running the government. Angelinia Alfano, of Berlusconi's party, the People of Freedom party, calls this "nonsensical" and the parliamentary whip calls this a "stupid provocation." WSJ's Alessandra Galloni intervewed the Italian premier. Monti's office says he called Berlusconi saying he regretted the "banal and abstract extrapolation of a trend in spread values, which was included in a wide ranging interview with the WSJ, was taken as a political consideration, which was not at all the intention."

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UniCredit announced plans to reorganize its Central European and Eastern European banking operations and increase its capital by 7.5 billion euros. Unicredit showed a third quarter 2011 loss of 10.64 billion euros after losses on Greek bonds and goodwill writedowns. The Italian bank said the capital increase will bring its Tier 1 ratio to above 9% as required by Basel III rules. UniCredit is listed as one of the globally systemically important financial institutions or G-SIFI's. Unicredit plans to make the placement of the rights issue to raise capital in 1st quarter 2012. Pricing remains a difficult matter considering that Unicredit shares have dropped precipitiously since 2007 when it had a market capitalization of 100 billion euros. Its market capitalization is now about 15.3 billion euros. Just in the last year the shares have dropped 50% to 0.68 euros a share in Sept. 2011.

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

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Ireland's government finally accepts a three year EU bailout package for its banks and public finances of 80 billion euros or $110 billion. Germany's Finance Minister Schauble said that Ireland "will have to meet strict conditions." Ireland's 2 largest banks, Bank of Ireland and Allied Irish, will be forced to downsize, and will have to unload "nonessential assets" such as overseas operations. The IMF will provide about one-third of the loans, the European Financial Stability Facility with its 440 billon euro facility will have the largest part, and the rest of the funds will come from bilateral loans from the UK and Sweden and the EU Commission. The UK's portion is about 7 billon euros. Germany's finance minister, Schauble, told TV brodcaster ZDF, that "one can't be certain this will relieve pressure on other struggling euro members." He was referring to Portugal and Spain.

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The Obama administration announces its decision not to allow offshore drilling in the eastern Gulf of Mexico or off the Atlantic coast through 2017. This is a shift from earlier policy. The Interior Secretary said the department will gather new environmental information about drilling off the coast of Alaska, which could postpone activity there. The Interior Department will also conduct "supplemental" environmmental analysis of Shell's plan to drill an exploratory well in the Beaufort Sea in 2011. Political factors may have influenced the decision, as the Obama administration is looking for business interests to support its other energy and climate change priorities, as part of what Interior Secretary Salazar called "a balanced package." Salazar cited scientific concerns. The President of the Ameican Petroleum Institute, Jack Gerard, said he failed to understand how a March 2010 decision based on science could go through a complete reversal now.

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The Economist view is that the USA, the Euro-zone, and the emerging markets, are all moving in different directions. The US has failed to address deficit concerns in the recent Bush tax cuts deal between Obama and the Republicans. The Euro-zone faces the prospect propping up its weaker members facing a debt crisis. and slowing growth from spending cuts.The monetary conditions are too loose and the flow of capital into emerging markets risks increasing inflation. This increases the chances of a macroeconomic shock if the govenments and central banks in emerging markets don't get the adjustments right- either doing too much or too little. The US faces the prospect of problems in the bond market with current management of public finances.The Economist views the risks compounding as a result of these divergences between these three regions, with the prospect of 2011 becoming a year of damaging shocks.

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The eight member panel of experts led by a retired judge gets high marks from the youth movement, and all oppositon parties. All have a good grasp of the legal theory to build a good system of democratic processes with checks and balances and necessary protections. The chief of the panel, Tareq-el-Bishri, is a retired senior judge, and an author of a book titled: "Egypt: Between Disobedience and Decay." Bishri wants to see prosecutions done in civilian courts, and wants a balance of power between government institutions. Members of the Youth Movement say they encouraged military leaders to setup the tasks of writing a new constitution in several steps, the first being rewriting the key articles and holding an up or down referendum. It was felt that a better constitution would emerge once elections were held, and enough time and debate could occur for the new constitution.

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A study by the Project for Excellence in Journalism of the Pew Research center, looked at six major story lines that progressed for one week in July. What it found is that 83% of the reports in the local news media were basically repetitive and had no new information. Of the stories that contained new information, 95% came from old media, which then set the tone for narratives done by other media outlets. The study covered the Baltimore Sun, Washington Post, their websites, several smaller papers in the area, and new online news sites. Another finding was that on one story of budget cuts, the reporting done in 2009 was less than one third of that which was done for the budget cuts in 1991. This confirms the point made by traditional media that new online news outlets do little more than repetition and commentary.

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Microsoft is making management changes in the unit which makes the Xbox, Zune music player, phone software. There have been some successes with the Xbox gaming console, but the Zune music player and phone software have done poorly. Robbie Bach, the head of this group is leaving. Microsoft has also cancelled a project to make a tablet computer to compete with Apples's iPad. After years of working on the tablet computer Microsoft found itself falling completely behind when Apple's iPad became a sensational seller, and HP's acquisition of Palm also sent signals to Microsoft. Analysts say the departure of Bach who was with Microsoft for 22 years, and of other executives in the revamping, will do little to change things. They question that Ballmer has the same touch and feel for the customer, which is something rare, and which Apple has at this time.

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India's Reliance ADA Group and CBS are planning to setup a 50-50 joint venture, to be operational in 2010 or early 2011. CBS would initially use American programming for the Indian television audience, and in the next phase work with Reliance ADA to develop local programming. Disney, News Corp., Time Warner and Viacom already have a presence in India. The market is getting crowded in India with News Corporation's Star Plus, a leader in soap operas and movies. Viacom's channel "Colors" is creating local versions of reality shows. The new venture would try to compete with more thoughtful programming and good marketing. The size of the market and growth is large, growing from $5.7 billon in 2009 to estimated $11.3 billion in 2014 according to KPMG. Only 58% of the households in India currently watch television. The programming is growing quickly with 460 channels in 2009 from 120 in 2003.

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Only 8 months into office, the leader of the Democratic party in Japan, resigns as Prime Minister. After perceived indecisiveness by the Japanese public on the Okinawa base change issue and on issues related to cutting wasteful spending. The base issue related to a campaign promse to move the American base out of Okinawa and even out of Japan. The North Korean government's aggressive behaviour led to a changing perception of the base issue, with a lengthy disagreement with Washington and eventual reneging on the campaign promise. By this time Hatoyama's popularity dropped to 25% and he resigned. Also resigning is Mr Ozawa, the Democratic Party's secretary-general. The indecisiveness and lack of leadership on issues made it difficult to sustain the electoral support which led to the Democratic party winning an overall majority, mainly to bring change for the post Liberal Democrat era.

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To get the agreement of the 27 countries engaged in the talks to set new banking rules, the new Basel III banking rules are being phased in over a protracted period. Some changes go into effect in 2013, but others will be put into effect by 2019. The focus on the new rules is how much capital, or "common equity" banks will be required to hold as a cushion to absorb losses in a crisis like that of 2008. Large banks will be required to hold 7% of their assets in common equity. By 2015, banks will have to begin building a 2.5% buffer of capital, which must be in place fully by 2019. No action was taken on issues such as requirements for banks to have access to ample liquidity, what systemically important banks should hold in capital, and establishing a counter cyclical capital buffer.

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The average of vehicles on the road reached a record of 11.1 years in 2011, according to R.L. Polk research company. Using the average of 15,000 miles driven a year used by the EPA for cost calculation on fuel economy labels, shows that car are being driven for much longer nowadays, over 150,000 miles. In the 1960's and 1970's the average was closer to 100,000 miles. Because of the EPA mandated fuel emissions standards and technological advances the newer cars in 2012 have better life than the older cars in the 1970's. Toyota's, Honda's and Volvo's frequently get 150,000 or 200,000 miles and still have some usage left for example. In addition the tighter fuel efficiency standards of the Obama administration and technological advances now underway are likely to bring a new generation of cars that provide another level of improved performance.

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China's Bright Foods Group acquires a 60% stake in Britain's cereal maker, Weetabix Food company. Cereal demand is growing in China and increased to 1.2 billion yuan or $191 million in 2011. This is an increase of 70% over 2006, according to Euromonitor International. Everbright sees large potential for Weetabix cereal in Asian markets. Cereal Partners Worldwide, a joint venture of General Mills, Nestle SA and Seamild Group of China, has the largest share for cereals in the Chinese market. Everbright is looking for more acquisitions as it plans to double sales in China by 2015 to about $14 billion. It has 3,300 retail stores in China. With the Weetabix stake Everbright gains shelf space and distribution channels in Europe and the U.S. An effort to take a 50% stake in French yogurt maker Yoplait failed in an earlier bid when it lost out to General Mills.

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The Liberal Democrats lost badly in the May 2011 local elections in Britain. Voters also overwhelmingly rejected the alternative voting system that the Liberal Democrats supported. The vote on an alternative voting system was one of the key conditions put up by the Liberals when they joined the Conservatives in a coalition government. About 69% voted to keep the current voting system supported by the Conservative party. In local races Labor and the Scottish National Party made gains at the expense of the Liberals. The Liberals lost 695 of their 1,751 seats in local councils, 12 of 17 seats in the Scottish parliament, and one of six seats in the Welsh assembly. Tory support remained steady, but voters turned away from the Liberals to show they do not support the austerity cuts of the Cameron led government. This will pose problems for Liberal leader Nick Clegg's continued participation in the coalition.

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Gen. Chen Bingde, People's Liberation Army chief of general staff, leads a military delegation from China to the U.S. He made a speech at National Defense University in Washington D.C. in May 2011. In that speech he pointed out that China's military capabilities remain far behind the U.S. capabilities, which he described as "a gaping gap." He described China's military modernization as having "unfortunately aroused unfounded suspicion and exaggeration of China's defense and military capabilities." With the overstatement of the threat posed by China only "distorting China's strategic intention, tarnishing its international image, and polluting the political environment for Sino-U.S. military relations." In other remarks he said China "does not want to use our money to buy equipment or advanced weapons to challenge the United States." The meeting between Admiral Mullen and Gen. Bingde was the first in seven years between military chiefs of the two countries.

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Army General Martin Dempsey is expected to become the next chairman of the Joint Chiefs of Staff in the U.S.. He brings a low key intellectual approach to the job, and was recently appointed chief of staff of the Army. He has worked in key roles in training and transformation of the military, led a combat division in Iraq and supervised the training of Iraqi security forces. Between 2001-2003 he managed the Saudi Arabian National Guard Modernization Program, an internal defence force guarding the Saudi royal family and the holy cities of Mecca and Medina. After the McChrystal appointment and resignation, and the effort by military leaders to get approval of troop buildups by making statements and speeches to affect public opinion, advisors in the Obama administration were looking for someone who would work well in an environment of de-escalation of existing conflicts and lower defense spending.