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Plans of the incoming administration of president Lopez Obrador to increase renewable energy from wind, solar and other sources, in Mexico. Mexico's potential is for 8 times the current levels for wind energy and 75 times current levels for solar. Solar energy has not received much attention as Mexico increased reliance on coal and oil for energy. Mexico's supply of renewable energy is only 25% of total installed power capacity compared to 50% for other countries in Latin America.

The Obrador administration plans to cut Mexico's emissions by 6.8% a year. Solar energy in particular has high potential in Mexico.

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The sharp drop in oil prices from the Saudi decision to increase output and cut prices is putting the U.S. oil shale drilling industry in a difficult position. About $200 billion in debt is coming due in the next couple of years for oil shale drillers who made large investments to get U.S. oil production up to 13.1 billion barrels per day by Feb. 2020. Most U.S. oil shale producers cannot make a profit at the oil price of $34 a barrel after oil price declines on March 9, 2020. At $34 these producers can no longer find it economical to extract oil.

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 Franco German differences are growing as Macron of France and Merkel have serious differences on NATO, Russia, EU expansion with Balkan countries, and a eurozone budget. Macron has called NATO brain dead. Merkel disagrees. The personal relations between the two leaders never close have worsened. 

On climate change Macron's push to cut in half greenhouse gas emissions in Europe was supported by Merkel but only after much wrangling within Merkel's own coalition government. German conservatives in the CDU fear it disproportionately hurts a heavily industrialized country like Germany. And most Germans are wary of the Macron idea of more EU integration after the experience with Greece and Italy, suspecting that Germans will have to pay the bill. EU officials say personal relations between Macron and Merkel now border on animosity.

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Issues of work-life balance are growing for doctors as more doctors ages 40-54 years face burnout or negative effects on health. Nearly half of doctors in the U.S. 40-54 years of age in a survey of 15,000 physicians report feeling burned out from work hours and administrative tasks. Younger doctors 25-39 years, and older ones 55-73 years also reported high rate of burnout at 38% and 39%. Overall for all physicians about half of all physicians said they would take a substantial pay cut to get a better work-life balance. What this survey and report by Medscape shows is that no age group, career stage, gender or specialty is immune to this problem, says Colin West, professor of Medicine and researcher on physician well being at the Mayo Clinic.

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In Germany the mood is changing in favor of vaccination as people are try to cut into the line for vaccinations based on age groups. Younger people even say they are caring for older parents to get vaccinated in this report from Hamburg and other cities.

This may be an encouraging sign even though it may not be following the rules because Germany's vaccine skeptics are giving way to vaccine envy. The word "Impfneid" refers to the feeling vaccinated people get with vaccine documents enabling them to travel freely. German took 52 million vacations in 2019, and only half that in 2020. In New York city people do not answer or say they do not want to get vaccinated in a door to door drive reported in NYT.

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Doctors face a 21% cut in the amount of Medicare payments for treating seniors having Medicare, though this cut will be delayed till 2011 under legislation in Congress. This issue goes back to 1997, when a budget law set spending targets, and stated that if they were exceeded formulas to reduce doctors payments would go into effect. The formulas seriously cut into doctor payments by Medicare in 2002, so the formula was put off. The result of this is that the cuts based on the formula now amount to 21%. The cuts are not expected to go through, but at the same time Congress has an headache on its hands with the growing deficit. In the Senate there is opposition to a $120 billion bill to extend long term unemployment benefits which lapsed in June 2010, for tax breaks, and other expenses. Senators want to pare down the bill's price tag, as $80 billon of this is unfunded and will be added to the budget deficit. For a primary care doctor in Washington state, Medicare pays about $95 compared to private insurers payment of $129, and a plan for state workers that pays $140....

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Lower oil prices, higher corporate profits, and restrained spending, lead to improvements in Japan's budget deficit. There is a 24% increase in corporate taxes in Japan's budget estimates for 2015 compared to Dec. 2012 when prime minister Abe assumed office. This will help reduce the budget deficit. The budget assumes an oil price of $69, making the budget plan achievable with prices below $50 in Jan. 2015. For the next fiscal year tax revenue is expected to increase by 5.4% over the prior year, with half of the increase from the sales tax increase and the other half from the higher economic growth. Budget projections assume 3.6% global economic growth, exports up by 5.2% in real terms, and imports up 3.9%. Spending is kept under control increasing by just 0.5% from the current fiscal year budget, and borrowing reduced by 11%. The government plan is to produce a primary budget surplus by 2020, and cut the deficit by half in the primary budget which excludes bond issuance and interest payments, by fiscal 2015....

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This opinion in the Hindusthan Times points out that prime minister Modi's speech at Kozhikode following a militant attack in Kashmir in September 2016, reflects a long standing policy since the late 1970's of Congress party and BJP or Janata party administrations. The idea is to encourage cross border exchanges to reduce tensions. The emphasis in back channel talks between India and Pakistan also emphasize the idea of CBM, cross border movement. The prime minister of Pakistan, Nawaz Sharif, has also expressed in the past the importance of cross border movement and trade as ways to improve the economies of both countries. The idea of building up trade and increased exchanges between the two countries is supported also by the U.S. and other western countries. The example of Ireland and Northern Ireland where trade and cross border exchanges are considered important by all parties after Brexit, is an example of how important this is.

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Banks cut off financing to developers leaving large projects incomplete and go after the personal assets of developers as laons go delinquent. Developers are suing the banks for not continuing promised financing.

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The cushion of pandemic savings of US households is thinning About 35% of it is spent already and by the end of the year 65% of it will be spent, says this report in WSJ. American households accumulated $2.7 trillion by the end of 2021 in extra savings during lockdowns that restricted spending and with stimulus government aid. At the exact time when transfer payments by the US government to households stopped there was inflation lowering the purchasing power and this has resulted in some households increasing credit card balances, dipping into savings and cutting spending. This is what economists are seeing at the Fed as resistance to price increases. Estimates show the percentage of disposable income saved in the US doubling to 16% in 2020 from 8% in 2019 with lockdowns, then dropping to 3% in 2022 with extra spending, and up to 4.5% by the end of 2023. This will have the effect of putting up resistance to inflation and lowering the Fed's interest rate increases to cut inflation. ...

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The social media site Twitter frequently loses money and took on $13 billion in debt says this report in the NYT. Musk faces financial challenges a he takes over the company, and this report says the company would be unlikely to invest and simply be paying the bills. Twitter it says, has not made a profit for 8 of its past 10 years. 

Twitter's interest expense alone would grow from $50 million to $1 billion with the new debt. Company operations generated about $630 million in cash flow to fund operations. Twitter had $6 billion in cash before the buyout and a large part of this would have gone to close the acquisition. All the financial resources of the company will now go to service the debt. About $1.2 billion in marketing expenses mostly salaries are likely to be cut. And layoffs of a significant fraction of the total employees may be a way to conserve capital to service the added debt, this report shows.

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New EU guidelines require cutting gas consumption by 15% over the next 8 months, and set priorities for which industrial sectors are required to cut back. The EU plan also includes switching from natural gas to nuclear or coal.  EU's Russian gas supplies in June are already less than 30% of what was received on average for the last 5 years. The new guidelines should ensure that Europe gets through the winter with adequate gas supplies in a complete cutoff of gas from Russia. The guidelines for 15% reduction in usage become mandatory in an emergency, and if the new guidelines are slow in being adopted they will also become binding. The safety, security and stability of society will be considered in allocating gas to sectors in the economy and to households. Industrial sectors such as glass and aluminiums would suffer damage to equipment with shutdowns, and chemical industries affecting the operations downstream through shutdowns, new factors that will have to be considered. ...

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India's 135 thermal power plants ahve just 4 days of coal stocks as of October 1, says the Financial Times, citing the power ministry. The power ministry has instructed plants to build up stocks. China is already facing a power shortage after coal fired plants were asked to cut down the use of coal to meet emissions targets. In early August coal fired plants in India had 13 days of stocks. With coal prices rising India did not buy enough coal to build up inventories. The manufacturing sector suffered a contraction in China for the first time since the pandemic started in 2020. China has instructed state owned energy companies to secure supplies of fossil fuel to prevent winter shortages. This further increased price of coal. Coal from Indonesia went up from $60 a ton in March to $200 a ton in September discouraging imports. The result is that with limited supplies and rising prices of coal India faces a perfect storm and power cutbacks as in China. ...

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OPEC and Russian oil producers are planning to increase oil production by 400,000 barrels a day for each month through 2022. Demand is increasing with economic recovery and this will lead to higher oil prices. Oil prices are now $80 a barrel in October 2021. Shortages of natural gas and high prices are leading power generation companies to use oil in place of natural gas. This will increase demand for oil by 500,000 barrels a day. Oil export revenue was cut in half to $119 billion for Saudi Arabia in 2020 and Saudis want to see higher prices to make up for lost revenue. OPEC + that includes Russia decided to end a price war during the Trump administration and this time have designed a strategy that will gradually push up prices. In recent years shale oil producers in the US quickly responded to higher prices of oil and increased production. After the pandemic in March 2020 American shale oil producers in 2021 are not increasing production. This gives OPEC+ better ability to set oil prices at higher levels. ...

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The most eco-friendly Athletes Village of any Olympics is finished in time in the poorer suburb of Ile-St-Dennis in Paris, France. French president Macron opens the Athletes Village facility in this video in FR24. 40 lowrise tower blocks are shown and they will house 14,000 Olympic athletes. This is the first time a 'sober' model is being used by reducing the cost- using existing facilities, recycling, re-use, and putting climate change low carbon technologies. The organizer Nicholas Ferrand says the project was done by using the best know-how in France on how to best respond to the challenge of urbanization in 21st century. It uses low carbon concrete, wood structures and geothermal heating to cut carbon emissions in half compared to conventional methods. It is located by the river Seine in a regeneration effort in the economically deprived suburb of Seine-St-Dennis. The suburb also holds the national stadium and is the poorest and most crime ridden of France.

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Maine's shift from heating oil to heat pumps. Maine is the state with the largest use of heating oil in winter, 50% of homes use heating oil. It was because utilities found it hard to set up transmission pipelines in a sparsely populated state that this happened. Now heat pumps which have no carbon emissions and take heat from outside and transfer it to the inside of homes are effective in the coldest weather and far, far better for Maine than heating oil. About 100,000 homes have heat pumps installed in recent years, and another 175,000 will have heat pumps installed by 2027.  State rebates cut the cost of $12000 for heat pumps to half that and there is another $2000 tax rebate. Users like the even distribution of heat and had problems with the cold parts of the house when using heating oil. Some rave about it. If all homes in America use heat pumps it would be like taking 32 million cars off the road, according to one estimate.

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The Fed's interest rate policies to fight inflation have increased the return on US assets vs overseas emerging market countries such as Brazil and India. US Treasurys now offer 2% return after inflation. This means investors shy away from emerging markets as the extra yield offered by emerging market country bonds is diminishing. This reduces inflow of investment into countries from Turkey to Brazil. Higher rates also increase the value of the dollar vs other currencies including that of China and India, Brazil, Mexico. This means it is costlier for other countries to buy goods priced in dollars (India, Mexico)  or service dollar denominated debts (Argentina or Turkey). Where countries had raised rates to fight inflation this means central banks have less room to cut rates to stimulate their economies. This also happens as China's growth of 5% in 2023 as it has high debt and little room for stimulus measures, reduces any growth in countries in Latin America or Africa that export commodities from copper and iron to other materials. ...

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The Japanese stock market index Topix dropped 6.1 percent on August 2, 2024. What caused this is the Japanese yen going from 161 to the US dollar to 150. The strengthening of the yen comes as the markets sensed two things- one the US Fed considering a rate cut based on employment and inflation reports, and the Bank of Japan raising rates. The rate increase of the Bank of Japan leads to a shrinking of the wide interest rate gap between Japan and the US. That gap had shifted money in Japan in the direction of US holdings. On Aug 5 the Nikkei 22 Index dropped 12.2 percent. It rebounded on August 6 by 11%. By August 7 the Nikkei 225 index was up another 1.2 percent. The situation can be summed up by saying that the Nikkei settled into a situation which recognized some strengthening of the yen to 151 to the US dollar. The fundamentals for the US and for Japan have not changed.

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A look at how Kamala Harris plans to focus on specific aspects of the Biden Economic Policy Agenda that are of the greatest concern for the American public. Cost of living action is the highest priority. Harris has ideas on this issue to cut housing costs and has specific proposals from 2023 with rising housing costs to tackle this by limiting rent increases to 5%. She will also come up with specific actions to sharpen her focus on cost of living issues to help ordinary Americans cope with rising cost of living for groceries, autos, auto repair bills, insurance costs, and energy costs. Economic advisors include the following from the years since 2020 with Biden as his VP- Brian Nelson,Treasury Department, Mike Pyle   Deputy National Economic Advisor for International Economics, Brian Deese     former National Economic Council Director  Gene Sperling, former Biden Economic Adviser, Deane Millison former Harris Economic Adviser, Rohini Kosoglu, Grace Landrieu, Bharat Ramamurti.      ...

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California has lots of water after record breaking rains in 2024 but this is not the situation in the Central Valley leading agricultural region of California and the nation. Farmers in the San Joaquin Valley in California say they are getting a reduced allottment of water because of concern about endangered fish species. Farmers in the Central Valley the fruit and vegetable basket of California will get just 40% of their usual alottment of water this year and will plant less crops. Some ranches planting only 60% instead of 80% of their land. In 2014, 2015 and 2022 droughts the farmers lost about $7 billion and it cost 40,000 jobs, say University of California researchers. This area is a top producer of almonds, pistachios, and tomatoes. Westland Water District, which covers this area and is largest irrigator in the US, has a study that shows correlation between water and poverty in this part of California. Just when it is recovering the water supply is being cut. ...

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The key people in the effort to implement DJT agenda of the Border and renewing the Tax cuts that expire on Dec 31, 2025 are Senate Majortiy Leader John Thune, Deputy Senate majority Leader. Alos playing a part are the Budget Committee chair Lindsay Graham and Mike Crapo of Idaho who chairs the Senate Finance Committee. Here is the approach Tohn Thune plans to use. He will do it two step, first getting the Border right by committing additional resources including offsets of cost from clean energy tax credits. Only after enough technology and resources for Border Patrol are made to secure the Border will the second step of tax cut renewal be taken up.  The process Thune plans to use is budget reconciliation which requires only a simple majority in the US Senate. Things are tight in Congress, in the House very tight with 217-215 and in Senate 53-47. Budget reconciliation means cannot add to budget deficits beyond 10 year window and bill have to budgetary. ...

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One cocoa pod gives enough cocoa for one chocolate bar. Cocoa farms in Ghana and Ivory Coast are the world's largest producers of cocoa. Production declined in 2024 by about 25% in the two countries from bad weather with rain in the dry season and not enough rain in the west season. To protect farmers both West African countries decided to give farmers a fixed price for their cocoa. With surging prices farmers do not get to benefit from the higher price. Government fertilizer support is lacking.

With buyers in Europe insisting that no trees get cut on forested land for new farming, farmers are restricted to their old plots and have to take out old trees which costs more. As a result of these factors cocoa farms are shifting to other crops including palm oil in Ghana.

Other countries in West Africa including Cameroon and Nigeria are also producing cocoa. Outside of this region Ecuador and Brazil also produce cocoa.

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The Fed's balancing act in cutting rates but at the same time seeing an orderly decline in the dollar and no sharp decline. Can it get the ECB to cut rates also? The situation after the Fed's rescue of Bear Stearns and the three quarter point cut in March 2008.

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One in five households were behind on their utility bills according to a survey and 5% had their utility service cut off terminated, last winter. Shows things will be worse this winter 2008.