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Polls by Renato Mannheimer show popular support for the People of Freedom party of Mr. Berlusconi, which won 37% of the vote in 2008, is now down to 17% This comes after a series of corruption scandals. The most recent involves embezzlement of 1.7 million dollars by a politician from the Rome-Lazio regional government. New parties are being formed which are drawing increasing support. The Five Star Movement of Beppe Grillo, a former comedian, which opposes being in the eurozone and calls it a "noose" for Italy shows 18% support, according to a poll by the SWG agency. In that poll the Italy of Values party had 6% support, and the Left Ecology party 6%. Mannheimer says only one third of Italian voters are now in favor of the large established parties, indicating a big change is underway in Italian politics. The new parties are also critical of prime minister Monti's policies. This happens just as political and business leaders in Italy are calling for Monti to run for office to continue policy changes he has made to improve Italy's competitiveness and lead to economic recovery. Monti, a former EU Commissioner, was appointed as prime minister after pressure from German chancellor Merkel and the EU led to a loss of parliamentary support for Mr Berlusconi with key members of his own party defecting. After passing legislation for changes to Italian labor laws and making other shanges to improve Italy's competitiveness since taking office in November 2011, Monti is now seen in Italy, and outside Italy in EU circles, as the only person who can lead Italy out of the economic crisis; even though his reforms and austerity measures have not proved popular....

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Italy's major problem is lack of growth, with growth averaging 0.3% in 2001-2010 compared to 1.1% for the eurozone area. In the 1st quarter of 2011 growth was only 0.1%. Italian bonds yield two percentage points above the yield on German bunds. With growth at the present level, Italy's would see an increase in debt to GDP ratios, according to Barclays Capital. Debt to GDP is currently at 119%.

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Krugman is critical of ECB president Trichet's decision to raise interest rates in 2010, because of the way it affects Spain, Italy, and Portugal. Increase in interest rates by the ECB affect the entire eurozone and this means, he points out, that inflation in Germany would be extremely low -about 1% for the next five years- and the result being that inflation would be much lower in debtor countries like Spain. A decrease in interest rates with inflation at 3-4 % in Germany would be better for the debtor countries (Spain, Italy, Portugal, Ireland) as this would enable them to cut prices and costs relative to Germany and other creditor countries. The first step taken by the new ECB president, Mario Draghi, was a small increase in interest rates. Krugman asks if the private demand is affected negatively by the end of a debt financed boom in the debtor countries, and austerity programs reduce any growth in the public sector, then where are the new jobs supposed to come from? A policy that reduces the prices of the products of debtor countries relative to creditor countries like Germany- so that exports can generate necessary growth- is needed says Krugman. ...

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Russia's leading business paper Vedemosti summed up the situation on Dec. 17, 2014, in its editorial- "This is a very dangerous situation; we are separated from a fully fledged run on the banks by just a few days..If the currency market is not reassured right now, the banking system will require large external support." Warning signs were evident at a banking conference in Moscow in October 2014 when the Economy minister, the central bank head Nabiullina, and the head of the largest bank Sberbank, German Gref, expressed skepticism about the economic policies and the risks involved. Not until Dec. 17, was a decisive response evident and the risks of a collapsing ruble openly addressed with economic actions by the Putin administration. A collapsing ruble would have repercussions on the global financial markets and slowing global economy, increasing potential geopolitical risk, and adding to risk of contagion for other emerging markets, which was reflected in the nervousness of global financial markets on Dec 15-16, 2014....

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Inflation in China and rising wages are pushing up costs for American manufacturers. The pressure on China, most recently in Congress, is helping to push up the value of the yuan. This combined trend is making it attractive for some manufacturers to bring factories home to the U.S. A trend in the U.S. towards non-unionized labor and the new trend to a two-tier wage level- with lower wages for entry level workers- and the shedding of legacy health care costs, is creating a more cost competitive labor force in the U.S. This extends from older industries such as furniture and auto components to newer industries and technology. The new factories setup in the U.S. use technologies that require a smaller number of workers, in most cases less than half the number of workers that were employed earlier. This adds another element in cost efficiency, though it means fewer jobs are created with new plants.

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Ishaan Tharoor provides a brief history of Russia's intervention in Syria and its role in the Middle East since 1950. This does not mention the Dulles period under Eisenhower in U.S. politics when the U.S. engaged in the Cold War withdrew support for building the Aswan High Dam, thinking that the Soviet Union would not come up with support. The Soviet Union under Krushchev provided $1.2 billion at 2% interest in 1958 for building the Aswan High Dam- constructed from 1960-1970- which helped increase irrigation and crops in the Nile river region and reduced the damage from droughts and floods. Soon after the dam was built it provided about 50% of Egypt's electricity. This was the high point of Soviet Union's economic engagement, latter support was defined by military arms supplies and led to the Six Day War, and the economic stagnation of the economy under Nasser's successors from the military. The Soviet Union was actively engaged in Iran with a Russian and British zone in the country in 1907, soon after the flowering of an effort to write a democratic constitution 1900-1907 for Iran with the help of British intellectuals, similar to the failed effort of the Arab Spring today. In neighboring Afghanistan the Soviet Union fought a long war under Brezhnev, contributing to the unravelling of the economic structure of the Soviet Union before the fall of the Berlin Wall. The British were primarily focussed on protecting oil interests in Iran in the period 1900-1950, yet contacts with British civil society led to the first grasp of democratic constitution and processes in Iran during this period. The American intervention funnelling arms support to the Saddam regime in Iraq in a war Iraq initiated against Iran 1980-1988, marks a low point in American intervention similiar to the Russian intervention in Iran-Iraq-Syria today. It may also define some of the problems of today because of the length of that war, the entrenching of military in the government in Iran, suspicions of the U.S., and the possible sense of a need for nuclear weapons to prevent attacks on Iran, as Pakistan has done in its conflict with India, though this is rarely brought up in discussions. The American arms support intervention, led to a series of cascading conflicts since 1980 with the invasion of Kuwait by the Saddam regime in 1990, the destruction of Shia in the marshlands of Iraq after a flawed peace agreement, and the follow up to that conflict with George Bush's invasion of Iraq on grounds of WMD development in 2003 for the 2003-2011 Second Gulf War including the Surge. The arms support of the Saddam regime in the war it initiated against Iran, was policy designed under President Reagan 1980-1988 following the hostage crisis and the Islamic revolution in Iran in 1979. The cascading crises with Iran and Iraq may not have led to this level of conflict and disruption, refugees and deaths in the Middle East, if American policymakers had heeded George Washington's advice during his presidency, that your enemy's enemy is not your friend when it comes to framing policy- for this reason Washington as president did not see it in the national interest to get involved in conflicts between Britain and France beginning in 1793, France having aided the American side against the British in the War of Independence. In the Proclamation of Neutrality, Philadelphia, April 22, 1993, he says: "Whereas it appears a state of war exists between Austria, Prussia, Sardinia, Great Britain and the United Netherlands, on the one part, and France on the other; and the duty and interest of the United States require, that they should with sincerity and good faith adopt and pursue a conduct friendly and impartial towards the belligerent powers.." And in a letter to Patrick Henry offering him the position of Secretary of State from Mount Vernon, October 9, 1795, Washington says: "My ardent desire is, and my aim has been, to comply strictly with all our engagements, foreign and domestic; but to keep the U States free from political connexions with every other Country. To see that they may be independent of all, and under the influence of none. In a word I want an American character, that the powers of Europe may be convinced we act for ourselves and not for others, this in my opinion is the only way to be respected abroad and happy at home and not by becoming the partizans of Great Britain or France, create dissensions, disturb the public tranquillity, and destroy perhaps for ever the cement which binds the Union." At a time of passionate political debate, it is time to step back and reflect on lessons that can be learned from the founding fathers about the way they tackled the important issues of their time....

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This WSJ editorial in September 2014 describes the Russian threat to the NATO alliance and the nations bordering Russia in Eastern Europe. This follows the Russian army's intervention in the Ukraine-Russia border regions in the end of August and early September 2014.

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The China Banking Regulatory Commission points to dangers of the Non Performing Loans ratio rebounding and serious risks in the financial sector from bad loans. CBRC chairman, Liu Mingkang, points to the risks associated with local-government financing platforms, and the real estate sector and industries with excess capacity, in the 128 page report for 2009 shown on its website. And he points out that fundamental cracks and flaws internationally, that were exposed by the global financial criis of 2008, have still to be resolved. He cites the regulatory issues, "too-big-to-fail" issue for large financial institutions, cross-sector and cross-country risk contagion toxic assets, and the budget deficits facing European countries, as major issues posing systemic risk.

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Barley points out the resignation of prime minister Monti in Italy is not a cause for panic, as his likely successor Luigi Bersani, head of the centre left Democratic party which leads in the polls with its electoral alliance having about 43% support, has committed to following through with Monti's policies and committments to the EU. Berlusconi is not the factor he once was with only 15% support in the polls, and anti establishment parties opposing public corruption such as Beppe Grillo's Five Star Movement appealing to younger people have about 20% support changing the political landscape in Italy. Other factors favoring Italy- a lower level of debt redemption in 2013 of 158 billion euros compared to 200 billion euros for 2012 will lower Italian bond issuance, Italy's primary budget surplus, the Italian economy bottoming out, and credit conditions improving. Year to date Italian bonds have returned 19.5%, and he sees no reason for an exit from Italian bonds. If polls continue to show a committment to the policies introduced by Monti, Italian bonds will continue to be attractive for investors. By setting Italy on the path to restoring and strengthening governance Monti has removed a key element for volatility in Italian bonds....

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Richard Cohen, Washington Post reporter, on the "no fly zone" option in Syria and how it could have prevented the loss of 300,000 lives, prevented millions of refugees, and moving politics in Europe in a direction that reverses the gains made in the post war period towards a more tolerant society.

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Research from Australian National University shows steadily improving conditions for migrant workers in China. Migrant workers were able to spend more time in cities- an average of 8.9 years. The hukou sysem ensures migrants return to rural areas when they have to raise a family. About 252 million migrant workers work in factories and construction jobs in urban areas. Migrants with children leave them with grandparents back home. Improving the conditions of these workers is important to reduce the wage and income disparities in China and to reduce inequality. About a fifth of the migrant population now has pension and health benefits. Creating a balanced economy with domestic consumer spending making a larger share of GDP also requires improving wages and benefits of migrant workers. Incoming prime minister Li Keqiang says in a statement on a government website: China "must take migrant rural workers and gradually change them into urban residents. This requires that we push forward household registration reform." If done seriously this will create a new kind of China as these migrant workers are integrated into urban society after years of being shunned and ignored by China's educated middle class. Professor Meng's research at Australian National University of migrant workers shows the proportion of migrant workers with unemployment insurance increased from 11% in 2008 to 21% in 2012. The research shows similiar figures for health and pensions. Improving their living standards also make it attractive for more young people from rural areas to migrate to cities increasing urbanization....

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Difficulties facing China from an overheating economy, a property bubble in many cities,, and a 22.5% jump in March in the broadest measure of money supply being the latest signs of trouble. The government announcement will show the economy growth at 12% rate in the 1st quarter of 2010 vs. 8.7% in 2009. The problem is that China may have acted too aggressively when the central bank increased money supply and state-owned banks in China's centralized banking system were ordered to jack up the lending. The $586 billion stimulus sent even more money to construction and energy companies. Without effective steps and fast the Chinese economy could run into serious problems.

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This essay in the Economist magazine describes the voter rejection of ruling parties and their candidates in France. Two presidents and two former prime ministers from the Socialist party and the Republican Party, Hollande and Sarkozy, Valls and Fillon face rejection. And another candidate from the Republican party Juppe also has fared poorly. This leaves two outsiders LePen of the National Front, and Macron a former Economy minister in the Hollande government who launched En Marche as his own movement for moderate change alternative in 2016. The rural-urban and less educated-more educated divide which was evident in voting in the U.S. election and the Brexit referendum is now seen in France, says this essay. Research from the Economist shows National Front support highest in outlying areas of major cities. The fears of immigration, terrorism, and globalization leaving parts of the working class behind are factors in this election. Support for the European Union is also a factor as it has suffered in recent years.     ...

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Foxconn announces salaries for workers would increase by 16-25% to about $400 a month before overtime. Foxconn plans to reduce overtime. Foxconn is a major supplier in China for Apple Computer.

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Prof. Gorton and Prof. Metrick of the Yale School of Management review 16 scholarly studies and papers on the causes of the 2008-2009 global financial crisis in the current isue of the Journal of Economic Literature. Another article in the same journal reviews 21 books on the subject. Samuelson says the most cited causes- lax regulation and passive regulators, and the policy of home ownership that encourage the packaging and of securitization of mortgages to government sponsored agencies Fannie Mae and Freddie Mac- are only the surface causes. If we are to explain how a whole society seemed to believe in the idea that somehow there was a way to maintain a rising tide continuously, with only small corrections over several decades, by the clever manipulation of monetary and fiscal policies; then one has to look to the hubris of economists who acted as if this was possible and the gullibility of business and a public that desperately wanted to believe as some have put it "that this time it was different," or that shrewd management of economic policy could actually bring about such a panacea. The abiding lesson is economic policies based on a better understanding of how modern industrial economies work are merely useful tools, no more no less, and there is no substitute for a good ethic, wise management and careful thinking on the part of the public, business and government, particularly for the people in leadership positions. ...

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Italy's prime minister, Monti, says he will submit his "irrevocable" resignation, after about 1 year in office, following the withdrawal of support from Berlusconi's People of Liberty party. He told president Giorgio Napolitano he would make an effort to pass the budget and a financial stability law to defer "the consequences of a government crisis" before turning in his resignation.