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China's prime minister Li Keqiang visited India in May 2013 with a trade delegation to improve trade ties with india. Trade between India and China is growing rapidly, with the growth in imports of telecommunications and power equipment, and consumer manufactured goods. Trade was at $76 billion in the year ending March 31, 2012 and is expected to reach $100 billion by 2015, making China the largest exporter of goods to India, according to Indian government data. The trade is lopsided with India's trade deficit increasing by 42% to about $40 billion in the last fiscal year. India is seeking improved access for its information technology and pharmaceutical companies to the Chinese market to correct the imbalance.

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On the 100th anniversary of 1947 and 1949 the Republics of China and India in about 25 years will have become fully developed modern states with science and technology by 2050, leaving behind memories of the colonial period. As the mother of Asian Buddhist civilization this region of northern India would be seen by a new generation of Chinese as part of ancient Chinese Buddhist culture from the days of Lord Buddha and Bodhidharma, and a gradual shift will lead to China leaving Tibet and the border regions of India in Kashmir, Arunachal and Ladakh of its own decision. China's entry into border regions- Kashmir region, Ladakh and Arunachal are a result of China under Mao and the Communist party decision to occupy Tibet and Indian border areas. A result of the memory of occupation of China starting from the border regions in the north Manchuria by the Japanese, and the Kwantung peninsula by western powers Russia, Britain, Germany. And the need to protect its frontiers in the border regions used as buffers by the British Empire, after the Communist Party under Mao created the People's Republic in Beijing. New technology in the 20th century made the high plateau's of Tibet accessible after 2500 years by construction of roads rail transport in high mountain terrain.  What this occupation of Tibet as a border region has done is to put China within a short distance, just days from the plains of India- a situation that has no precedent in the entire history of the world dating from Lord Buddha. Compared to the desolate regions of Manchuria in the north this has an Indian population in the plains of India of as much as a billion people. Just as China sought protection from its own memory of occupation by the Japanese and colonial powers, India seeks protection from colonial powers and the Chinese now in Tibet similar to the Japanese in Manchuria just days away from the plains of the Chang Jiang (Yangste) and  Huang He (Yellow River) of China, China just days away in 2025 from the Ganges/ Brahmaputra , and the Indus river regions. The British Empire no longer exists. British names such as McMahon for McMahon Line frowned upon by anti-colonialist China, no longer exist. India also an anti-colonial power frowns upon such names and the arbitrary way the British (also the Portuguese, the Spanish, Dutch and the French) decided what belonged to whom, including whole nations. As early as 1505 Portuguese occupied Sri Lanka (Ceylon), occupied by the Dutch as part of cinnamon supply zone by 1700, and transferred by treaty to British in 1802, the memories of colonialism date back on the shores of India to 1505.    ...

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All you need is this article in the WSJ of Sept 16, 2015, showing forecasts of rapid growth of coffee consumption for an aspirational western lifestyle consumer in China, and a small mobile app investment to attract investors in a startup -if you refashion the coffee retail outlets as a tech company by selling coffee for delivery and takeout by mobile app. Luckin Coffee in China shown in the podcast in today's articles did this and attracted billions of dollars in investment from investors, including large banks and financial companies in Europe, U.S. and China, only to collapse in 2 years with losses and investigations in China and the U.S. Luckin Coffee soared after its NASDAQ stock exchange listing in 2018 only 1 year after its founding. WSJ calls it "brazen" the effort to add tech hype to a coffee company and have it listed on NASDAQ in just over a year, only to see its sales and value collapse just as quickly. For U.S. investors the problem is that Chinese companies can list on the NASDAQ or other stock exchanges in the U.S., but U.S. investors cannot look at financial records of companies in China. Yet there are basic questions- why is it a tech company? Why are investors like big banks and other large financial investors pushing so much money into such places when there is so much that needs to be done in health and infrastructure investment, and real tech investment? 5G or 6G? Health systems? Ocean Grounds has a coffee store in Shanghai, Pacific Store has coffee retail outlets in China, and Starbucks is still in the business with retail outlets - remember none of these companies are tech companies. In 2017 Luckin Coffee started by making it look techy with a mobile app and refashioned itself as a tech company.  What is so big about a mobile app as there are hundreds of millions of apps. The rest came from making it look like Starbucks, right down to baristas, fancy coffee machines, and opening stores near Starbucks, according to the Podcast in the WSJ.The difference between Starbucks and Luckin Coffee - the price Luckin Coffee would sell for about $2 compared to about $4 for a Starbucks latte. Yet do this by pricing at closer to Starbucks and issuing promotions discounts constantly on the mobile app, that would bring the price to about $2. That is all it takes to make a tech company nowadays. No scientific research, no science and technology, no technical experience, nothing of the kind that led to the invention of the computer chip or the vaccines that are now being developed, or research activity of any sort. Banks, financial companies are willing to channel huge amounts of money into these places and lose it, as they did in We Work, and are doing at companies such as ride sharing app companies, as well as other app companies without any core technological component or value added such as infrastructure or health products. At the same time as investments in much needed infrastructure and health, education, services that really matter to us as a society, are neglected and starved of capital.   ...

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Prime minister Modi's visit to the US comes at a time when US president Biden is eager to show the US is fully engaged in the Indo-Pacific region with its allies in the Quad 4 countries- Australia, Japan and India. The recently announced Aukus defense agreement brought together 2 members of the Quad 4 the US and Australia, plus the UK. Aukus is designed to strengthen US presence as a naval power in the Indo-Pacific region in the Indian and Pacific oceans around India, Southeast Asia, China, and across the Pacific. After a futile engagement in Afghanistan the US is reorganizing its presence where it is strongest- in the oceans. In a way that Britain once did in the eighteenth and nineteenth century, the US is dominant in the high seas. US naval power far exceeds that of all navies in the world combined. This is meant to reassure India, Bangladesh, Sri Lanka, Thailand, Malaysia, Indonesia, Philippines, Vietnam, Australia and Japan, which together have close to twice the population of China, that the US has not diminished its presence in any way from that it had in the 1950's following the Second World War. With this new framework India enters discussions that will focus on health to deal with the pandemic and its after effects, with security and rule of law in the Indo-Pacific region, with trade, technology, new supply chain manufacturing structure in which India plays a key role. With this new focus and clearing past engagements made by other US  presidents, including some mistaken policies, the US emerges as a new force in the Indian ocean, China seas and Pacific ocean region.  On September 23 Modi meets Tim Cook for what could be new supply chain arrangements that Apple could be preparing as it and other US corporations build new supply chain structures to rebuild US manufacturing technologies capabilities that were lost to China over the period 2000-2020. During that period manufacturing technology knowhow was shifted out of the US in a mistaken policy that assumed design and invention were sufficient for the US to keep. The first step in this direction was a change of CEO's at Intel Corp with US president Biden pushing for new US technology reclaiming policy. Following that the new CEO at Intel Corp, Patrick Gelsinger, completely reassessed Intel's mistaken policies of ceding its entire semiconductor manufacturing technologies capabilities to Taiwan and China. Intel made a U turn and is now investing all or most of $50 billion in the US instead of in China or Taiwan.  On September 24 Modi meets Mr Biden to discuss trade, investment, defense, and security. On the same day the leaders of Japan, Australia, Mr. Suga and Mr. Morrison join Modi and Biden for the Quad 4 talks. Indian infrastructure capabilities and Indian economic growth would be key goals to strengthen India along its land borders along Tibet occupied region and Himalayas as part of the overall effort to build a new US and allied presence in Asia.  On September 21 Modi attends a Covid Summit that will look at the way forward in the aftermath of the pandemic and ways to vaccinate the remaining unvaccinated population in the world, as well as vaccination passports.  ...

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Having an adequate supply of N95 masks is critical for each hospital tackling the coronavirus pandemic. The lack of enough masks leaves health care personnel without the basic protection and is a grave emergency. Hospitals are resorting to reuse of the masks in this crisis and this is not a good practice as it increases the chances of infection. President Trump has invoked the Defense Production Act on April 2 against 3M. This gives the federal government more control over 3M's operations to ensure that it goes all out to make the healthcare N95 masks that the hospitals need in this grave emergency. This report in the WSJ covers the situation as of April 3 on the supply of M95 masks for health workers and others. N95 masks block 95% of very small particles. Supply in the U.S. is for 50 million N95 masks. Demand in the U.S. is for 300 million N95 masks as estimated by the Department of Health and Human Services. in March- this is how many are needed by health care workers to fight this pandemic in the U.S. The principal manufacturer is 3M. 3M company has doubled its production since January 2020. The trend before this pandemic was to send production over to China and other countries. This is changing now with the pandemic and the U.S. policy shifting to be self sufficient in medical supplies in the event of an emergency. A policy Peter Navarro, who heads the agency in charge of getting medical supplies, says President Trump is insisting be implemented. Hospital buyers supported the earlier trend to keep costs down, but this appears to be a costly mistake, putting health care workers in hospitals across the U.S. without the basic protection they need. Minnesota based 3M invented the first modern disposable masks in the 1960's. Interestingly 3M continued to make millions of masks in the U.S. even though competitors moved manufacturing overseas. The 50 million disposable masks 3M made globally went to workers in industries where it provided extra safety from metal shavings or other substances, and medical workers. Now 90% of masks go to medical workers. 3M ramped up production globally since January 11 when the pandemic first hit to 100 million masks a month globally, and 35 million a month in the U.S. at plants in South Dakota and Nebraska. 3M says that it will import 10 million masks from its factory in China, which earlier this year was restricted from shipping it outside China as China needed masks for the pandemic. About 10 million more masks are made by two other manufacturers Alpha Pro and Louis Gerson Co.  U.S. Department of Health and Human Services ordered 600 million N95 masks from 5 companies to distribute to hospitals and build up the national medical supply stockpile. 190 million each of this is from 3M and Honeywell and 130 million Owens & Minor Inc.  3M says it will make 50 million a month in the U.S. by June. Honeywell which had moved production overseas, plans to bring back production to the U.S. by making 10 million masks by May at its Rhode Island and Phoenix plants. There is a company in Singapore that makes one million masks a day in China and other Asian countries, Pasture Pharma Pte, but most of it is committed to government agencies in China.   ...

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The Soviet threat actually receded after 1964 when Brezhnev became head of Soviet Union till 1982. During that period in the 1960's till today the face of NATO as today was from a series of heads of governments of Dutch Stikker in mid 1960's or other small European states such as Norway Stoltenberg and Rutte Netherlands again in 2025. It could be said that none of these leaders  of small EU countries represented US interests- or even European interests- a point the DJT administration is trying to make. First NATO head UK's Hastings Ismay's NATO for "keeping the Russians out, the Americans in and the Germans down" is more British Imperial policy of 1904 -1940's as the Indian Viceroy's Assistant, not US policy or in America's or even Europe's interest in 2025. It hurt the US in Venezuela as Russia propped up a regime which led to millions of refugees entering the US illegally. And it hurt Europe as Russia propped up the Syrian regime with millions of refugees entering Germany and destabilizing its political structure. Going back if a new defense institution was set up to replace NATO by the Europeans in 1970's this would have been the right step which would have not led to Russia propping up regimes in the Americas or the Middle East. A goal that is being discussed with Russia by the DJT administration to refocus American efforts in a new direction and pause not just the Ukraine war but also put the US  and Russia in a new direction with the new competition from 3 billion people in China and India changing everything we know about the world. ...

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As one group of B-2's headed west pver the Pacific, another group quietly headed east to bomb the Iranian nuclear weapons development sites. The intent was to carry out the decision made by the US and the EU and tacitly supported by Russia, China, India, and the world, to prevent the proliferation of nuclear weapons. It is now evident that since the beginning of 2025 the number on priority of the DJT administration in foreign policy was to end Iran's effort to get a nuclear weapon. This is why the US DJT administration brought together Gulf regimes Qatar and UAE, Saudis for $2 trillion in business and economic deals in a DJT visit in May 2025. It is also evident that when India launched air strikes on Pakistan terrorist bases in June the US president DJT ended the war quickly in 72 hours. The Pakistan military head met with DJT in the White House a week back. This was preparation for the plan to take out the nuclear sites with minimal regional instability, a goal of the American people after Reagan/Bush miscalculations in supporting Hussein in Iraq and creating the Middle East wars Americans have had enough of. It may close a chapter of violent conflicts in the Middle East to be replaced with US support for India, UAE/Qatar/Saudi, Pakistan economic deals economic agreements. Much of the Indian media fails to understand this. The job of a US president if done right has responsibilities to the Nation and the World, after all the missteps of his predecessors DJT is stepping into this role. ...

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The Guardian provides this first account of what happened in the Galwan Valley border between India and China at the Line of Actual Control. It is described as the worst fighting in 60 years. On the high steep ridge lines above the rapidly moving Galwan River a patrol of Indian soldiers encountered Chinese troops in a steep section of a high mountainous region. They believed the PLA Chinese Army had withdrawn from the ridge in line with a June 6 disengagement agreement. The Indian government says that what happened afterwards was pre-meditated ambush by the PLA forces. In the fighting that ensued the Indian commanding officer was pushed from the narrow ridge falling to the gorge below. Reinforcements from the Indian side were called from a post 2 miles away and about 600 men were fighting in near total darkness in high mountain ridge with stones iron rods for upto 6 hours. Following a decades long tradition to avoid escalation of hostilities because of nuclear weapons of both countries the two sides have not used other weapons. Most deaths on both sides were from soldiers falling or being knocked from mountain ridges. The main problem in the conflict is the Line of Actual Control exists but since China's takeover of Tibet in 1950 there is no agreement that has set the official border. The British Simla agreement in 1912 set the border with Tibet in an agreement between Tibet and the British Empire in India, when Tibet was an independent country. China claims that historically going back to Ming and Qing dynasty Tibet was part of its region. For most of its history Tibet was an autonomous region with closer contacts with India because it is close to Nepal and Nepal is very near the Indian Bihar state border.  A new rail link from Raxaul, Bihar in India to Kathmandu is only 137 kilometres, and from Kathmandu to the Tibet border is only 205 kilometres. Fast rail or road links would put Tibet within a few hours by rail or road to Tibet from India. For the entire period the US exists as a nation about 250 years and from the first landing of the colonists on American shores about 1607 Tibet was a mountainous region that was so remote that few people even knew about the country's existence. Beijing and Shanghai are four thousand kilometres away, India much closer to Tibet through Kathmandu, Nepal and India sharing a common culture, and no one thought much about the mountainous borders at 15000- 20,000 feet in the western Himalayas, till China's takeover of Tibet in 1950. India had no clear idea what this meant in 1950- no clear border except for what was agreed between the Tibetan independent government  and the British in 1912 which was set under the British Empire- resulting in a fluid border. And China had no clear idea that this would put in a place it would not want to be thousands of miles from the Yangtse valley region home to most of China's population, in a remote mountain region at heights of 15,000 -20,000 feet, with little to gain. Throughout history since 1000 and earlier Tibet remained a region that acted as a buffer between China's western provinces and India, the high mountains at 15,000- 20,000 feet making it inaccessible. Which is why the Ganges plains and the Yangtse river valley plains contact was made more through the oceans than by land, and the areas developing distinctly different language and cultures. All this changed after 1954 when the Qinghai Tibet highway was built, the closest city on the Chinese side is Xining. Xining to Tibet is a distance of about 2000 kilometres at an average height of 4500 metres or about 14,000 feet.  ...

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Overall consumer prices were up 4.4% higher in October 2010, than a year earlier, according to the National Bureau of Statistics. Most of the increase in prices was concentrated on food and energy. China is taking action to limit price increases. During previous rise in inflation in 2004 and 2005, the government has resorted to detailed price controls. China's cabinet of ministers, the State Council, has issued orders that local governments and other government entities provide temporary subsidies to help the needy cope with rising prices and to increase allowances for needy students. Chia fears social unrest if prices go much above 5%. The Food and Agriculture Organization of the UN warns that food prices have gone up by 10% in the poorer countries. According to economists, China is effectively printing its currency renminbi to buy $1 billon a day worth of dollars to keep the renminbi weak, so that its exporters retain an advantage in overseas markets. The central bank takes away some of this renminbi but not all from the system, by selling bonds to state owned banks and increasing the amount of reserves required at the central bank. To keep the renminbi from rising, China's central bank buys up the investment dollars that are coming into the country, as well as dollars coming into the country from the trade surplus....

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A new state government in Bihar state, India, takes shape with Nitish Kumar as Chief Minister and 2 Deputy CM's from the BJP party. Bihar is the second largest state in India after Uttar Pradesh, with Maharashtra the third, West Bengal fourth making up the top four by population each with over 100 million people. Rajasthan, Madhya Pradesh, and Gujarat make up the top 7 states each of these three with about 75 million population. Rapid economic development depends on state governments working with the federal government on investment, technologies and effective governance. Gujarat and Maharashtra form an industrial core for India with investment increasing in Uttar Pradesh and Madhya Pradesh which forms the rural interior in the Ganges plains. In contrast to China where industrial development is state driven led by the CCP in a centralized form embedded in the complete authority of the central government, India has to achieve this through the democratic process based on delivery of infrastructure projects and standards of living. Much of this depends on the combined effort of federal and state governments ,with seven of these eight states having this coordinated effort in 2024, at a time when foreign investment in the economy is increasing rapidly to diversify global supply chains. This provides an opportunity for India to change from a developing economy to an advanced industrial economy in stages by 2030 and 2040. ...

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The US is requesting talks with China at the World Trade Organization with the objective of ending hundreds of millions of dollars of subsidies China gives to increase wind energy production. The wind power grants are being targeted because Chinese producers are required to use domestic parts to be eligible for the grant, which range from $6.7 million to $22.5 million. In the last 5 years foreign companies' share of the Chinese market has dropped from 79% to 13%, according to Goldman Sachs, with China's efforts to promote Chinese manufacturers. The renewable energy market in China is expected to reach $100 billion by 2020. And wind energy is the fastest growing sector. The effort comes after the US Steelworkers union alleged that China was using import substitution subsidies in violation of WTO rules, in a 5800 page petition. Steelworkers union president, Leo Gerard, says this doesn't address most of the billions of dollars of clean-tech subsidies and other support provided by the Chinese government. Gerard says the goal is not litigation but to put an end to these practices that are trade distorting, and act as a barrier to US exports to China....

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Compromise reached at the October 2010 G-20 meeting in S. Korea to reduce trade imbalances, and for countries with current account surplus exceeding 4% of GDP (China 4.7% and Germany 6.1%) to bring these balances down by 2015. Countries with large current account deficits, Turkey 5.2% and South Africa 4.3%, were expected to bring their deficits down and increase national savings. The US is at 3.2%. The US proposal for a target was accepted by Japan as long as it was not a fixed target but a reference point. Germany was opposed, saying it was a return to planned economy thinking. China did not comment on the issue. Canada, Australia and the UK supported the US position. The compromise was an effort to continue pressure on China to redirect its policies away from exports to increasing domestic consumption, while still refraining from a fixed target. It also takes some of the pressure off a fast track currency rebalancing, with China expected to increase the value of the yuan, but given more flexibility than the rhetoric would suggest....

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The Big Beautiful Tax and Spending Bill in the US Congress faces close votes in the US Senate with Senators Rand Paul of Kentucky, and Thom Tillis of North Carolina, both Republicans against it.  The Senate version has additional cuts to Medicaid funding. Tillis expressed concern about these cuts. Senator Rand Paul is opposed to increasing the deficit for enlarged spending and tax cuts. Republicans and DJT have close votes in the Senate and in the Congress. Republicans Murkowski of Alaska and Curtis of Utah want to change the early phaseouts of tax credits to the renewable energy industry in the Senate bill, and the excise tax after 2027 to avoid buying from China and develop American manufacturing in renewables. Senator Collins of Maine has an amendment to add $25 billion for rural healthcare and rural hospitals to offset the effects of large Medicaid cuts. Collins plan also lets taxes revert to 39.6% from 37% for married couples incomes over $50 million.  The bill then heads back to the House for changes by Wednesday, July 2, for a goal to have it on the president's desk by July 4th, Friday. ...

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Ford. will still make $8 billion to $11 billion this year even after losses of $3 billion in electric cars. By 2026 Ford says it will earn 8 to 9 percentage points in profit from EV's. Ford is basically investing in the EV industry now for the long run. It is also part of the effort to move away from fossil fuels. Government incentives and subsidies will help companies and buyers of vehicles make the transition to EV's to fight climate change.  Companies that have not invested in EV's such as Toyota risk falling behind in EV's at a time when climate change is a major priority for buyers and governments around the world. Toyota is moving to a new CEO who can better take up the challenge of EV's. Under the previous CEO Mr. Toyoda Toyota clung to a mistaken belief that hybrid cars were all that is needed to reduce use of fossil fuels. German, Chinese and US manufacturers are taking the lead in EV's and Japan has fallen behind.  WSJ has never favored government subsidies and is critical for this reason. Yet it is clear that in some situations such as fighting climate change, building infrastructure, and redesigning the supply chain, government has to take the lead. Eisenhower in the 1950's with a government led effort helped build the national highway system, the first in the world. Biden is making a similar effort on multiple fronts. The redesign of the supply chain comes after private industry without proper direction from the government over concentrated manufacturing in China with Japan as a supplier into China. Presidents Bush and Obama wasted time and resources better devoted to national priorities at home on wars in remote places such as Afghanistan and Iraq. President Biden wrapped up the war in Afghanistan and completely disengaged from an area that is of no constructive interest to America. Resources are now concentrated in the right way on real national priorities from manufacturing at home to fighting climate change, fighting the cost of living crisis and building better infrastructure for workers and families. ...

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Sadanand Dhume in WSJ reflects opinion in the US that is wary of handout politics that has been carried to an extreme in India's election. In Venezuela the bad turn for the oil rich economy was when Chavez's successor Maduro ignorant of the problems it would create decided to give oil at almost no cost to all Venezuelans. In India the leading opposition party offered $1 lakh rupees to every woman in the state of Uttar Pradesh. India's federal government under Modi has given free food to about 800 million people and renewed the pledge this year because of the pandemic's devastating the rural economy- about 60% of India is still rural. This is essential for India to advance to build a broad based growth model for India similar to China 1990-2010 and Japan 1890-1915 and 1950-1970 during the transformation of their economies, similar also to the US under FDR/Truman/Eisenhower/Kennedy 1940-1965.  Clean environments Swacch Bharat was essential for basic sanitation and toilets to reduce health risks, cooking gas to shift rural women from firewood and health risks, direct deposit bank accounts for 300 million rural households essential to eliminate leakages, solar energy is planned to cut energy cost  This has brought and will bring the level of income and consumption power of the lower and middle classes to create a 500 million strong consumer base for industry. It is a carefully planned effort based on the success in states such as Gujarat, and looking at the way this was done in China and the US for learning lessons. It is not a reckless effort to win votes such as the offer of 1 lakh rupees to every woman in Uttar Pradesh state with no plan for industrialization and modernization of the Indian economy to make it the third largest ahead of the EU by 2035. Dhume is right to point this out and it is apparent to any outsider who looks at Sab Ka Vikas Sab Ke Saath- prosperity for all, including all parts of society irrespective of caste and religion.  ...

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The International Renewable Energy Agency (IRENA) says in a new report that the cost of renewable energy production in India in 2020 is the lowest of 8 countries, including China, France, Germany, Italy, Spain, UK, U.S. It also points out that India has lowered the cost of solar energy faster than any other country since 2017- by 80% for the period 2010-2018. Solar energy for India in 2018 cost 27% lower than in 2017. Major achievements have been made in solar energy and are continuing with bold targets. In 2020 solar makes up 36% of total energy capacity, with production at 136 gigawatts. In India the conditions with high degree of sunlight in most parts of the country, and the technology cost reductions, lower cost of land and labor, help bring down the cost of solar energy every year. The bold targets and action taken are symbolic of the new efforts in India. The early efforts in India are described as overcoming the hurdle of preconceived notions that electricity shortages had to be accepted as a way of life. In Gujarat the first efforts over 15 years ago were taken by rejecting the idea that electricity could not be made widely and freely available. To do this policy had to be set by starting with first a clean slate and then with a clean heart say pioneers in India's early gains. A clean heart because of how desperately people needed electricity. And a clean slate because how desperately people needed to start from scratch with a new structure and new way of doing things set in place. As Vivekananda put it over 100 years ago "This I have seen in life. One who is overcautious about himself falls into dangers at every step. he who is afraid of losing honor and respect gets only disgrace. He who is always afraid of loss always loses." By taking bold action, making small experiments then setting bold targets and setting structures in place to execute manned with resources, India has achieved 4G in all parts of the country, and is doing the same for renewable energy to make electricity widely available in all parts of the country. ...

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Major decline in oil prices in Oct. 2014 as prices drop to $81 per barrel and are forecast to reach $70. U.S. oil production increased by about 56% or 3.1 million barrels a day since 2004. U.S. demand for gas and fuel declined 8% compared to 2004. Initially instability and wars in the Middle East sustained high oil prices in 2012-2013. Yet with growing output from shale and other sources in N. America and slowing economies of Europe and China, the situation reached a point in 2014 where supply exceeds demand. This shift more than offsets any instability in trouble spots. The situation affects the U.S. consumer favorably with an estimate of $1 billion in savings for American consumers with every one cent drop in price at the gas pump, by one estimate from Deutsche Bank analysts. Typical American families gained an extra $50 a month from the decline June to October 2014, according to analysts at Gasbuddy.com. The declines are a boost for the slowing economies of Europe, Japan, China, S, Korea and India. China's imports for 2015 are estimated at 61% of oil consumption, using official estimates. In the current slowdown the lower prices offer relief. India which imports 75% of its energy benefits signficantly, as this helps lower inflation and reduces cost of fuel subsidies for state run companies. Russia is adversely affected by the declines as it depends on oil and gas exports for 50% of the nation's budget. Estimates by AFK Sistema economists show the Russian economy contracting in 2015 with oil at near $90 per barrel (Brent crude is at about $85, and WTI at $81 in early Oct. 2014). Russia's former Finance Minister Alexei Kudrin reflects opinion among Russian executives and politicians, when he told state television that Saudi Arabia may be pushing prices lower to target Russia's oil resource based economy and Mr. Putin, in an effort to broaden the effect of sanctions. (The Saudis have strongly protested the Putin intervention in Syria.) Venezuela has used $120 per barrel and Angola $98 for its budget, leading to a strong hit for the economy. ...

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Indian PM Modi will take part in the swearing in of a new government in Maharashtra on December 5, 2024. Maharashtra and Gujarat with cities Mumbai and Ahmedabad were part of Bombay state in 1947 after independence. It was also the largest trade and industrial region of India. Today it is poised under the Modi government to deliver industrialization on a scale that matches that of China for a modern Vikshit Bharat over the next decade and to 2040. This is the real significance of this event which in some ways surpasses the US election in significance and the scale of transformation of the largest nation in the world.

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With the hype around AI and the propagandizing by people like Altman, Microsoft, and others AI got to the point where it made up 34% of the S&P 500 capitalization, and all time high for 7 of the large companies since 1980. Nvidia who makes the chips for AI  making up about 6.8% of the S&P 500, contributing to a quarter of the total return on the S&P 500 index in 2024.

Till someone in China figured out a way to do it at 5.6% of what it costs in the US for the high flying AI companies in the US. 

 

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Senator Mitch McConnell, the U.S. Senate Majority leader, and Speaker Ryan, achieved a win in the U.S. Congress which is expected to set a new trend of bipartisan cooperation, as the House passed the bill in Dec. 2015 for $1.1 trillion spending with a vote of 316 to 113, and the Senate with vote of 65 to 33. The persuasion on the Republican side was based on giving Speaker Ryan a strong hand in negotiations with the White House in 2016. Ryan secured a lifting of the oil export ban for the Republican side in return for flexibility in spending. Ryan deftly sent the issue of Puerto Rico having access to bankruptcy laws to the committe chairmen to come up with a plan in March to get the needed votes. Democrats had pushed for aid to Puerto Rico. Also included in the bill that passed is giving more voice to emerging market countries China and India in the running of the IMF.

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Prakash and Ghosh in the Hindusthan Times remind readers that even though India has ambitious plans for renewable energy much remains to be done in shifting to clean coal technologies. An estimated 80% of India's coal plants use obsolete technologies, making this an obvious area for improvement. India plans to make solar the source of 100GW of 175GW it plans to generate in renewable energy by 2022. Yet it must not be forgotten that coal is a dominant source for the foreseeable future and shifting to clean coal technologies is an area that should get top priority from the government. Today India is the third largest in terms of carbon emissions after the U.S and China.

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The government controlled Securities Association of China says a fund of 120 billion renminbi ($19.4) billion is set up July 3, 2015 to buy shares in the larger more stable companies and reduce selling of shares from brokerage firms portfolios. This is not likely to have much impact because of its small size, and because the volatility is concentrated in small and medium size firms stocks which had doubled since June 2014, and were hit by the sharp decline in June 2015. The stock exchanges in Shanghai and Shenzen also suspended initial public offerings. Share prices have dropped by about 30% since June 12 on the Shanghai and Shenzen stock exchages. With the surge in the Chinese stock market prices till June 12, 2015, share prices of many small and medium sized companies doubled or even quadrupled in value. The overall index on the 2 exchanges doubled because as the smaller stocks quadrupled the large blue chips went up by about a fourth in value. The overall Shanghai market went up 149% to June 12, 2015, over the prior year. It is down 28.6% as of July 5, 2015 since June 12, 2015. A stock index of 100 large mainland Chinese companies traded both in Shanghai and Hong Kong were up about 24% by contrast. A major problem is the margin trading with loans to investors from stock purchases up nine times in 2 years and informal financial companies charging annual interest rates of over 20%. Small investors focussed on small and medium sized firms because they were going up the fastest, and many risked their life savings. Younger workers were also part of the group caught up in the frenzy of stock buying. Shares in the larger companies are only about 30% of the overall value of companies on the Shanghai Stock Exchange....

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There appears to be a conscious deliberate decision by the Chinese government and policymakers to shift the economy from low-end technologically unsophisticated and polluting industry, that pays low wages with little worker protections, towards technologically sophisticated, environment respecting, and higher wage industry. This does not mean textiles are out, but textile companies that are larger better managed, able to introduce newer technologies and produce higher quality product- that command higher prices in the world market and therefore also able to sustain decent wages and worker protection- are in. Phasing out the smaller shops and the poorly run or deliberately polluting and labor exploiting companies run from Hong Kong or elsewhere. The general shift is to be a leader in products which are value added either by technology or human capital, such as better trained more knowledgeable workers. This is similiar to the shift Japan made after the sixties, as it moved from a rural to a urbanized society and textile companies like Kanebo became technologically sophisticated, while small shops withered out, and Japan gradually shifted into automobiles, electronics and chip making. The noticeable difference is that Japan with a prewar industrial base and a smaller market protected its home market for Japanese companies, whereas China lacking this prewar industrial base let foreign investment and companies overseas bring in equipment and use low cost Chinese labor to supply western markets. And it turned a blind eye to labor protections, at least till it had built up its own industrial base and knowhow with policy requiring Chinese partners in industry and technology transfer. Economic winds are also doing the job. Inflation, Chinese goods prices increased by 4.6% in May according to the U.S. Commerce Department. This is a result of the Chinese government requiring worker protections and decent wages and stricter pollution enforcement resulting in increased energy costs. For years the U.S. and other countries depended on China for low cost goods and the demand for low cost goods depressed margins which resulted in legitmate costs such as pollution control technology, worker protection and decent wages, being ignored. China is now left with heavy environmental cleanup costs, and a bad image internationally as a heavy polluter. The huge external trade surpluses China has built up exceeding a trillion dollars have pushed up the value of the yuan making Chinese goods costlier in world markets, and apparel and shoe makers in developed countries seeing Vietnam as a better lowcost alternative. The story of this phase of Chinese industrial development can be seen in a town like Honghe, a 90 minute drive from Shanghai, which has half of its 100,000 residents working in 100 factories and 8000 shops that knit, dye, package and ship some 200 million sweaters a year, bringing in according to local government estimates $650 million a year. Now many of these shops are idle and mirant workers are returning home. To see the subtler signs of the Chinese policymakers hand note that even visa policies have been tightened to make it harder for foreign buyers to visit Chineses factories and trade shows. Also the Chinese government has raised the minimum age for workers in these factories from 16 to age 18 and so on. And the impact is being felt in places like Honghe near Shanghai, Shengzhou another city near Shanghai which makes one third of the world's neckties, and in Dongguan in Guangdong where its toy, shoes shops close. The change also shows how quickly things can change in the world economy. Only 3 years earlier in 2005, Jiaxing Yishangmei Fashion Company, a family owned company was booming and had just landed Walmart Stores as a customer. Now Walmart no longer sources from this company. Analysts say that the Chinese sweater industry was probably overbuilt, with about 6 cities in China claiming to produce more than 100 million sweaters annually. A wave of consolidation could boost efficiency, and bring pressures to innovate rater than compete only on price. And many Chinese economists, and policymakers think China has relied too much on cost-cutting and simple production models to increase exports. A researcher at the Chinese Academy of Social Sciences thinks such a high dependence on foreign trade is not good for China. For the US and Japan this researcher says that trade is equivalent to 20% of gross national product and by contrast for China trade is equivalent to an extreme of 75% of GNP. ...

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Xiaomi is China's leading brand. It is very different from other companies in China and America. It is tightly controlled by its founder Lei Jun who has built a loyal following for the brand  through fan clubs and creating an enthusiastic following. Because the firm is run by founder Lei Jun it can make quick decisions to enter a market. Lei Jun was a computer science student in Wuhan in 1987 as China opened up to the world.  By 2017- in three years from being zero in the Indian market place in 2014- Xiaomi had become the largest smartphone company in India. The company was launched in 2010. Profit margins are thin about 1% in a very competitive pricing market.  Metrics are based on revenue per user of $9 per user from an installed base of 190 million smartphone users, spending 54 minutes a day using Xiaomi's app, game and other services, or 20% of the phone use time. Revenue per user comes from advertising, and from commissions on the apps and games it sells to its user base. In 2015 Xiaomi had a loss, in 2016 sales dropped, in 2017 new products led to a resurgence in the market with sales increasing 68%. As Xiaomi goes into its IPO, experts say much of the $10 billion from the IPO could go into reinvestment as Xiaomi reinvents itself and moves into other internet business. ...

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Late Show with Stephen Colbert cancelled by CBS as parent company Paramount merges with Skydance in 2025. The televisions late night comedy show with political overtones was a show that lasted 30 years. It goes the way PBS goes as PBS funding is no longer renewed by the US Congress and PBS seen now as a leftover from the 1960's. PBS covered a better part of the Cold War period from 1960 to 1990 and continued for another 35 years before funding was cutoff under DJT. The situation is different today with the rise of Asian nations, China and India. The Voice of America was also a part of the 1960's period and covered the Cold War, and lost its focus after 1990's. VOA is also being defunded for lack of effectiveness. New media, and new ways to reach the American people with new ideas, and reach the people of the world with new ideas are needed today.