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Resistance within Angela Merkel's coalition government to enlarging the funding for the European Financial Stability Facility. Resistance comes from the FDP's Economy minister, Phillip Rosler, and from Horst Seehofer, the Bavarian state premier and head of the Christian Social Union.

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The next tranche of aid to Greece is 31.5 billion euros on Nov.12, 2012. Greece has agreed to a package of austerity measures of 13.5 billion euros of spending cuts and tax increases. About 85% of this will go to recapitalizing Greek banks which took losses on sovereign Greek bonds under an agreement. The hope is that Greek banks will lend to businesses but there is skepticism in Greece about bank's willingness to lend. The economy is expected to contract by 6.5% in 2012. Under the agreement civil servants on "special salaries" will see cuts of 35%. Associate professors at universities will see the count reducd from 15,226 to 2000. A majority of tax exemptions will be ended. About 5000 civil servants in 2012 and 20,000 in 2013 will face salary cuts and be transferred to other jobs or dismissed. The package has to be passed in the Greek parliament. Finance minister Stournaras says Greece needs to reduce the interest rate on its debt and extend payback periods. Stournaras says Greece will be given more time to implement the austerity measures. The Merkel approach to the Greek crisis is causing a rift within the eurozone with France's president Hollande and the SDP opposition leader in Germany critical of the way it is being handled....

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Economic growth in India has slowed to 6.9% for the June to September period 2011, compared with the prior year, according to a government report. The sequence of rate increases by India's central bank have failed to slow inflation, and foreign investment is declining. Economists now forecast growth at 6% for 2012, a low rate of growth for India, which has a growing population approaching 1.2 billion people and serious infrastructure problems. This creates a scenario of stagflation- high inflation and low growth. The fears are now for a combination of high government debt, infrastructure issues, and lack of foreign investment. This is leading to moves by the Indian government to bring up long delayed efforts in the area of opening the retail industry to foreign investment. And lifting quotas on foreign ownership of Indian bonds, allowing foreign pension managers into India. The value of the Indian currency has declined 15%, in 3 months since August 2011. The eurozone crisis and the combination of slowgrowth and high unemployment in the U.S. are leading to foreign investors withdrawing from emerging markets, with a sharp impact on India. A combination of domestic and international factors are hitting India after two decades of high growth. ...

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Christopher Power talks to three former IMF officials. If offered the Greece portfolio at the IMF, Simon Johnson, (a former IMF official) says he would ask for a transfer to Iceland, because Greece is incredibly complex, with the IMF unlikely to impose conditions. Especially with IMF chief Dominique Strauss Kahn's aspirations to become President of France. The ECB controls Greek monetary policy and there is no chance of a devaluation with the Greeks in the euro currency. This leaves Greece locked into an unsustainable currency rate. Kenneth Rogoff and Michael Mussa, both agree that the IMF can help buy time for Greece with bridge loans and laying a framework for confidence. Mussa points to the Greek problem- the credit markets won't buy their bonds forever and at the same time its a nasty business to have a sovereign default in the euro currency area. Mussa sees the situation as much like that of GM. Bush bought time for an orderly transition should GM have to declare bankruptcy, which is what happened under Obama. With the European recovery weak, Portugal and Spain fragile, an orderly arrangement is critical not to upset markets. Its like kicking the can down the street, says Mussa, but that can have some advantages. ...

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Pearlstein says American Airlines (AMR) management had hoped to reduce employees count by 13,000, reduce benefits for employees and retirees and reform work rules by going through bankruptcy in the manner of other airlines such as Delta and Northwest. As it turns out AMR's unions and US Airways have made their own deal and come up with labor agreements that are likely to result in a merger deal with AMR with 1.2 billion in savings from synergies, instead of relying on labor savings for $800 million as AMR management had planned. This is because US Airways CEO, Doug Parker, sees increased savings and revenue from a new combined airline and a better hands on management team. Part of the reason is also the the way the combined airline provides additional feeder traffic from smaller cities to hubs in the east coast and midwest markets and in the Miami routes to South America. The Pension Benefit Guarantee Corporation also tacitly sees the benefit of a stronger airline so that its funds are not depleted further by having to support AMR's underfunded pension plan. The creditors have also realized what all this means by increasing the value of AMR bonds to 50 cents on the dollar from 30 cents on the dollar....

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China's domestic debt has surged to levels that precede a crisis, to 216% of GDP and heading for 271% by 2017 according to Fitch Ratings. As a result president Jinping has taken over control of economic policy and controlling debt, especially local government debt, is now a top priority for 2014. Jinping will head the "leading group" for overall top down reforms, reflecting the new urgency. Local government debt went up 67% from 10.7 trillion yuan to 17.9 trillion yuan ($2.95 trillion) in just 3 years from 2010 to 2013, according to the National Audit Office. About half of this debt is due by the end of 2014, according to Standard Chartered Bank economist Stephen Green. Another risk is that shadow banking with interest rates of 10% are now about 11% of new lending. The option adopted by the government to use central government funds and regulation to restrict lending could make local governments turn increasingly to the shadow bank lenders (trust companies, and informal lenders) making things worse. The other option of tackling it aggressively by letting some companies default has the risk of other lenders raising rates on loans and bonds. This makes solutions tricky and prone to problems of increasing severity. ...

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JP Morgan Chase bank's tentative deal with the U.S. Justice Department includes agreement that the bank will not face penalties for the problems at Washington Mutual and Bear Stearns, financial companies acquired during the 2008-2009 financial crisis. The failing firms were acquired at the urging of federal regulators and management at JP Morgan sees holding the bank responsible for the culture and behaviour of management at Washington Mutual and Bear Stearns as not a fair response of regulators. What the deal does do is include provisions for covering losses of investors. Of the $13 billion legal settlement JP Morgan will provide about $3 billion for institutional investor losses on mortgage bonds issued by JP Morgan, Washington Mutual and Bear Stearns. $4 billion goes to the Federal Housing Finance Agency, for misleading the regulator about quality of mortgages sold to Fannie Mae and Freddie Mac. Another $4 billion goes to homeowners for losses suffered. $2 billion relates to penalties for JP Morgan's own behaviour during the years leading to the financial crisis. Attorney General Eric Holder and the Justie Department see the settlement with JP Morgan Chase as a template for action against other banks for behaviour leading to large investor and homeowner losses following the 2008 mortgage financial crisis....

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Sweden's currency, the kroner, appreciated by about 4% in March 2015. The central bank responded by lowering rates further from minus 0.10 to minus 0.25%, and added to earlier announced 10 billion kroner purchase of government bonds with an addition of 30 billion kroner.

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Japan, this report shows was in a weak position and was willing to concede- its auto industry could absorb a 15% tariff but the rest of it's economy must be protected. Any economic weakness would be exposed and conditions mght deteriorate in the Japanese economy by letting things go past August 1 and steep tariffs. Luttnick's idea of investment fund was supported by Japan for investing $400-$550 billion in the US with 50% of profits going to the US. Earlier NYT report by Ana Swanson shows the American side of the deal where Howard Luttnick, with experience as a bond trader and on Wall Street, came up with the unconventional idea of an investment fund knowing that the LDP facing elections and  fearing loss of  its majority was unwilling to give DJT what he wanted on some trade issues. Japanese negotiators decided that giving some way on auto tariffs accepting a 15% flat tariff on auto imports was one way to accomodate the Americans and protect other Japanese industries exports from steep tariffs. One would not know this from reading the WSJ, but DJT with Luttnick, Bessent and Greer as negotiators with Akazawa and Ishiba of Japan have won a historic and significant win for America in creating a level playing field in trade. It also sets a precedent for all other trade deals.  ...

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Gen. Dan Caine chairman Joint Chiefs video on Operation Midnight Hammer bombing of Iranian nuclear site at Fordow. Dan Caine traced the project for Fordow to 2009 when a small team was formed in the US Threat Reduction Agency inside the US War Department as the Fordow mountain site was being prepared- right from the outset of the beginnings of the Iranian efforts to bury weapons development deep inside a mountain. 15 years of work by the team leaders led to the US monitoring every aspect of work at Fordow for the day a US president decided it was time to remove that threat. DAn Caine showed in a video how the bombs actually work, not exploding like a conventional bomb but penetrating 2 shafts at the Fordow site and going down these shafts for 1000 feet before reaching the location where the nuclear centrifuges are located and the pressure inside doing most of the real damage during explosion at that point over thousand feet inside the mountain. The first 2 bombs removed the concrete caps put on the 2 shafts, subsequent 6 bombs each going through the shafts. This is the reason why the Guided Bomb Unit 57 which was made for this specific task mission at Fordow was effective. The CIA Director has stated he had a body of credible intelligence that the mission was effective and Iran nuclear program is severely damaged. ...

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American corporations lost faith in the American worker with a series of missteps by labor in the US by 1999 which were also failures of top management and engineering for quality on the assembly line and wages to compete with low cost outshoring. In losing this faith in the American worker America's corporations lost faith in their own country, in their own people- the people of America. Larry Summers was mentored by Treasury Secretary Rubin from Goldman Sachs. Deputy Treasury Secretary under Rubin, president Clinton. Following Rubin in 1999 as Treasury Secretary. Several key events happened that damaged America and the working people of the Nation -and each time Rubin and Summers are seen as giving wrong advice. The first deregulation of financial markets setup by Clinton-Rubin-Summers in 1999 led to financial crisis of 2009. The second setting up China's entry into the World Trade Organization without safeguards that caused China to use unfair practices to destroy much of America's manufacturing base. The 2009 financial crisis-  The support for repealing the Glass Steagall Act in 1999 and for deregulation of financial markets by Rubin and by Summers led to deregulation that caused the financial crisis of 2009 with overleveraging of US banks and faulty mortgages. This was the first blow to the social and economic fabric of America, to America's workers and families. The second body blow came from decisions made by president Clinton with advice of Larry Summers as Deputy Treasury Secretary and Treasury Secretary in 1999.  Advice that Clinton regrets  and sees as wrong and which have shaken American workers faith in the traditional Republican and Democratic parties of Bush, and of Clinton-Obama 1992-2016, a 20 year period which saw almost the entire industrial base of the US shipped to China  by American corporations working with China. American corporations lost faith in the American worker with a series of missteps by labor in the US by 1999 which were also failures of top management and engineering for quality on the assembly line and wages to compete with low cost outshoring. In losing this faith in the American worker America's corporations lost faith in their own country, in their own people- the people of America.     ...

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Gordon Crovitz points out in this op-ed that an issue of this importance of preserving an open and independent internet free of influence of governments and politicians, should not be left to the Assistant Secretary of the Commerce Department and administration officials. He points out the need for Congress to play a role in determining the future openness and independent nature of the internet free of politics and governments. He says the Obama administration's move to use the Dotcom Act to transfer the role now played by ICANN to a new body in which other governments say they want to play a major role, is a mistake as it risks the very openness of the internet that has been its core quality and mission till now. Doing this by July 2016, in 30 days following its submission to Congress by the Obama administration, is prevented by Senator Ted Cruz's effort in Congress requiring clear approval by Congress. The U.S. has a unique role in this respect because of its role in defending freedom of speech since its founding, a role found nowhere else in the world. ...

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Only one in three Mexicans graduate from high school according to the OECD. Only about 4750 of Mexico's primary schools out of 99,400 give a full day of classes. The 1.4 million teachers union dominates the educational system and decides which teachers get hired or fired. Only union members can hold teacher positions and teachers are guaranteed lifetime positions. No testing or evaluation system is accepted by the union. A system unlike anything seen in other countries with strong teacher unions. The government of former president Calderon tried and failed to change this system. The new president Enrique Pena Nieto secured the cooperation of opposition parties to a 95 item agenda for change in Mexico. As one of his first steps he passed a bill in Mexico's Congress 360-51 changing the Mexican constitution to give the government powers over the hiring and firing of teachers, creating a new independent body for evaluation of teachers and requiring teachers to meet set standards. It also lengthens the schooling day to 6-8 hours from an average today of about 4 hours, half that in other industrializing countries such as S. Korea....

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Thomas Frank writing about the public outrage about executive compensation quotes Bill Black, a Professor of economics and law at the University of Missouri-Kansas City, who makes an important point. Beyond the size of this compensation there was something else happening that was perverse in its design and in its effects. Black says that at each point in the development of the disaster of mortgage securitization, it was the pay for performance systems that sent the wrong signals to loan officers, real estate appraisers, accountants, and bond rating agencies. The compensation or reward systems actually encouraged wrong, unethical and ultimately disastrous behaviours for the companies and the economy. Another way to look at it, the way it happened on Wall Street- especially at Merrill Lynch and some other financial institutions- the bonuses and other compensation was a way for executives to recklessly milk (loot is the other word) the companies for all they could yield regardless of the results afterwards. And as Black says, to do this through normal corporate mechanisms. A whole range of behaviours of this type took place in the final years of the boom. See other articles by Thomas Frank. ...

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Simple changes in style-“I’m not planning on wearing a suit, and I don’t expect you to wear one.” Patel on Week 1, Feb 27 2025. Raises fitness requirements for FBI agents and gets his personal fitness trainer a pass into FBI. Oath of office taken on the Indian Bible the Bhagavad Gita held by Attorney General Pam Bondi. Also oath for the Bureau of Alcohol, Tobacco, Firearms, Explosives. Addressing crime in cities including Detroit, Cleveland, Minneapolis. Action to move 1500 FBI agents to these cities in a regionalization plan out of Washington DC. Regionalize the FBI throughout the Nation to make it serve the safety of cities and neighborhoods throughout these United States. It reflects the illegal fentanyl flows into the United States from foreign countries that led to 490,000 deaths in the US over 12 years on which previous action of administrations has clearly been a colossal failure. Following the people's mandate to make America's neighborhoods safe for children and families, protecting the social compact with its people of the elected government. The unwritten aspects of the US Constitution or of any sensible Constitution of any civilized nation. To focus the FBI on internal threats in America's cities and neighborhoods from drugs, gangs and fentanyl flows that illegally enter the country. And not on foreign threats during this period when this social compact in the US is threatened by fentanyl flows and 490,000 deaths over the last 12 years. ...

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A former bond salesman at Goldman Sachs, who became managing director at Lehman Brothers and at Credit Suisse Boston, writes a book- The Investment Answer. He has only a few months to live after getting brain cancer, and decides he is going to make the best use of this time by writing this book. He points to the futility of active money management. And he is one of the few top money managers to take back a lot of what he learned during his career. At one time he says he did believe in the idea that our word was our bond, and good ethics was good business, but that was before this was transformed by liar loans.

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Simon Nixon says the main problem with the E.U. bank stress tests of 2011 is that it did not test for sovereign defaults. For example Greek debt that is trading at 50 cents on the euro, was marked down 15%. And the lack of urgency to raise fresh capital is another problem. He says the real value of the tests comes from the asset disclosures that accompanied the tests.

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Mario Draghi, president of the European Central Bank appears before the Economic and Monetary Affairs Committee of the European Parliament. He said the ECB had resumed normal lending to Greece's four major banks after the 18 billion euro recapitalization of the Greek banks by the government of Greece using bailout funds assigned for this purpose. Draghi tod the parliament: "The ECB will continue lending to solvent banks. We will avoid bank runs on solvent banks." At the same time he asked the EU to setup a deposit insurance fund for European banks and regulation of banks at the European level. On the actions taken by European leaders Draghi had strong criticism for the slow response always one step behind action needed and a day late, saying: "The next step is for our leaders to clarify what is the vision for a certain number of years from now. The sooner this has been specified the better. Dispel this fog." He described the configuration for the eurozone of the last ten years as unsustainable unless steps are taken, with leaders having to decide quickly what kind of eurozone they want to see. On Bankia's recapitalization by the Spanish government, Draghi said everybody winds up doing the right thing after many delays at the highest possible cost and price. It showed the need for centralization of supervision at the Europe wide level because Spain took too long to tackle the bad real estate loans at Bankia....

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Spain's budget deficit as a percentage of GDP comes in at 6.7% for 2012, according to government figures. This means Spain is making significant progress in bringing down its deficit to reduce borrowing rates. This gives the government more flexibility with austerity measures at a time of rising unemployment estimated at 26%.

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Russian economy is faltering under the strain of the global financial crisis. The stock market is plunging, with the RTS Index down 19% on October 6, 2008, and the market down 60% since the high in May, 2008. Construction spending is winding down. Th economy growth rate was 8.1% in 2007 but its slipping. If oil prices hit $50 and they were already at $78 on October 10, 2008, then says Anders Aslund at the Peterson Institute for International Economics in Washington, there will be a sharp decline in the growth rate. Moscow analysts say the growth rate could drop to 4%. For Americans Russia may seem remote excpt for investors. But in a global economy there are connections to emerging markets and Russia is one big emerging market, next to China, India and Brazil. When General Motors shares dropped 31% and Ford's 22% on one day on October 9, 2008, the news that spooked the markets was ofcourse a credit watch and questions about liquidity from Standard and Poors rating agency, but alsoimportant was that the one bright spot for GM and Ford in Europe and in Russia in particular was disappearing as GM sales declined in Europe and in Russia. In the prior 12 months GM had seen sales jump by 40% in Russia giving it 10% of a car market that passed Germany recently as the largest car market in Europe. Couple of important things about Russia. Russians today are big spenders, savings are small and Russians do not trust their banks so bank deposits are very low. Household deposits are equivalent of 17% of GDP, compared with 45% in the USA. Only 4% of Russians trust commercial banks according to a poll by National Financial Research Agency in Moscow. So Russia depends on the outside world for much odf the cash flowing through its financial system. Foreigners purchased two thirds of the $170 billion in bonds isued by Russian companies and foreign banks put up half of the accumulated $900 billion in bank loans including almost all longterm debt estimates Moscow investment bank Troika Dialog. With global credit markets in a lockdown mode Russia is simply running short of cash. The government has $560 billion in foreign exchange reserves from years of high oil prices plus $160 billion in two sovereign wealth funds with most of this money in fixed income securities abroad as a rainy day cushion should oil prices tumble. On October 7 the governmet announced $36 billion in emergency loans to Russian banks following earlier pledges in September of $150 billion in loans and relief for Russian companies in danger of defaulting on international debts. One danger here is that about 55% of outstanding corporate loan are of maturity less than 1 year. One of Russia's largest developers Mirax Group is putting 50 projects on hold as bank financing for developers has almost ceased. On the other hand Russia's financial sector is relatively small and the credit crisis cannot hurt Russia as much as it will USA ad Europe. Bank loans account for 10% of corporate finance and the bond market is only a decade old, so about half of all capital investment by companies comes from retained earnings. And Russia has huge needs for investments in infrastructure after years of underinvestment, a stable political structure, an educated workforce, and an economy that is just getting started. As Secretary Paulson answered questions after the G7 meeting October 10, this was another point on the minds of the secretary and questoners, the hope that emerging markets like Russia, India, and China would continue to grow though slower than before, even as the US and Europe slipped into a long recession, and provide a little cushion to the global economy....

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UK economy declines 0.3% in April 2025 as exports to US decline. The UK is one of the few countries that reached a trade agreement with the US. Also important to note is that the UK economy grew by 0.7% in the 1st quarter of 2025. The US tariffs are a negotiating strategy says Treasury Secretary Bessent to get countries  including the EU and China to have a level playing field in trade with the US, and not take the US for a ride. This has some costs but they are temporary and we are all better off that world trade can now be on a firmer footing than the imbalances of before. Bessent for instance told members of the US Congress in the last 2 days that US inflation is actually 0.1% and has come down, the 10 year yield in the US bond markets has come down, and the US is managing this transition without cost increases. He said Walmart had increased prices after tariffs, Amazon and Home Depot had not, and he sees American buying from sellers like Amazon and Home Depot. The British economy will also benefit with the certainty that it now has a clear trade agreement under fair rules that will promote bilateral trade with the US. ...