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The Australian government forecasts lower GDP growth in 2012- dropping to 3.25% fro 4% earlier. The government plans spending cuts of 11.5 billion Australian dollars over the next 4 years, which will further affect economic growth. The mining and resources sector boom is leading to an overvalued currency which is affecting growth in manufacturing, tourism, and retail sectors. Australia has two economies and this limits economic policy options.

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Changes to China's five year plan to include critical social goals, reduce income inequality, and provide a social safety net. The influence of local governments in distorting central government policy.

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China's July 2012 exports were up barely by 1%, over the same month prior year. Exports to the European Union declined by 16.2%. A big problem is cost increases for land, labor and electricity. By 2004 China's exports were growing at a peak rate of 35%. Since then prices of inputs have increased- wages by 150%, land by 70%, and electricity prices by 30%, according to Dragonomics. The yuan appreciated by 30%. Productivity is increasing by about 8% a year, according to the World Bank. As a result of the price increases of inputs the competitiveness of China, with products exported mainly on the basis of price, is deteriorating.

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Mike McNamara, CEO of Flextronics, on the increasing competitiveness of U.S. manufacturing and the return of manufacturing jobs to the U.S.

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Krugman says that China fears that a decline in the value of the dollar will reduce the value of the 70% of the $2 trillion in assets it holds, that are in the form of US Treasury bills. This may have been the reason Zhou Xiaocuan, China's central bank governor called for a new currrency to replace the dollar as new "super-sovereign reserve currency." He doesn't think this is likely to happen. Neither is his hope and that of Japan that somehow the two countries can export their way out of current difficulties. The US will not be the market it once was, that is certain. So Krugman says China, Japan, and the Europeans on the issue of the Stimulus are all hoping that things will return to the way they were. Something that is not going to happen. March figures in the US for jobs lost hit an high of 663,000, and this crisis says Krugman has years to run.

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The yuan has risen 14.5% against the yuan in the last 4 months, according to the Chinese Commerce ministry. Loosening the Chinese currency's peg to the dollar will increase the value of the renminbi even further. And with further declines in the euro expected this would seriously affect Chinese exporters to Europe. This also makes European goods more competitive than American goods in the Chinese market putting the Obama's administration's goal of doubling exports further at risk. The Shanghai stock index declined by 5.1% on Monday May 17, 2010, reflecting these concerns. The Chinese government continues to intervene in currency markets and the renminbi is now at 6.827 renminbi to the dollar.

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Proof that this is not an ordinary deep recession like those in the post war period comes in the way foreign trade is reacting in this downturn. Already evidence of this has been seen in the way Germany has been affected because of slowing exports from China to the US. German exports to China have declined as the Chinese export model comes under severe stress. A similiar situation is playing out for Japan. Now new proof of the drop in foreign trade is emerging in Commerce Department figures. Combined exports and imports of the USA dropped 18% in 4 months July to November, to $326 billion from $398 billion. Two thirds of this drop was in imports. So China and Japan's exports to the USA are severely affected. Japan showed a 27% decline in exports in November, according to the Japanese Ministry of Finance, and imports dived 14%. According to calculations by the WSJ, Germany had 11.8% decline in foreign trade in November, and similiar numbers for France and Britain. Chief US Economist at IHS Global Insight, Nigel Gault, says this is going to be the worst global recession since World War II. Combined with what is happening to inventories, (see links) and what is happening in housing, banking, the auto industry, and other industries, the complications of non-transparent packaged financial products clogging the American financial system, the hugely indebted consumer (see links), and the $2.1 trillion and rising cost of the stimulus and bailouts needed by one estimate, suggest that the recovery forecast for 2009-2010 does not take into account all these simultaneously occurring patterns and developments working together. ...

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Alan Mulally talks to Charlie Rose about cost competitiveness, negotiations with the UAW, creating jobs, and the repayment of $20 billion of the $23.5 billion borrowed in 2006. Mullaly points out that 70% of R&D is connected with design and manufacturing- all the technology that goes into designing and building and the associated R&D.

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As India's growth rate improves, one weak area is agriculture which is growing at about 3% a year, and contributes only 13.7% to GDP. Of huge significance is that about 600 million people depend on agriculture. Lagging development in this area leaves the nation backward as a whole. Farming practices are still backward and have not changed significantly. Agricultural markets, infrastructure, is still backward and needs improvement. Decline in the size of plots since 1970 from about 6 acres to about 3 acres today, and low productivity on farms is a problem. Farmers fear being pushed off the land and politicians look to the rural vote to preserve the status quo. Poor monsoon rains can increase problems for farmers as three fifths of farmland is still without irrigation. Agricultural markets are fragmented, so that apples from Himachal Pradesh in the north are not easily shipped to Karnataka in the south, and coconuts in the south not easily shipped to the north. State marketing boards in India called Agricultural Produce Marketing Committees (APMC's) control trade in fruit and vegetables. There are about 3000 fragmented agricultural markets in India, and markets can be fragmented within states. Laws from the 1950's to prevent hoarding are still on the books reducing incentives to invest in cold storage and warehouses, a significant problem in India leading to much waste and rotting of agricultural products. This hurts farmers because it leads to cuts in price. The distribution chain also hurts farmers with middlemen and commissioning agents taking as much as 6% in commission compared to the international level of about 0.5%. This review of the state of agriculture by the Economist says that 25 years after the first reforms opening up India's economy in 1990, agriculture as one area which touches the life of about half the population has not seen much change....

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During the campaign and in the crucial Iowa primary Obama used newspapers, small and large, to get his ideas across. At one point he gave six interviews to one columnist for the Daily Times Herald of Carroll, Iowa, (circulation: 6,000). He chatted with reporters from papers like the Mason City Globe Gazette, Fort Dodge Messenger, and met with editorial boards of papers throughout Iowa. Some of these media may just be curious to hear a new kind of message, and Obama could use the communication skills developed in years of writing to express his ideas and his vision all in a casual setting, seeing faces, expressions, feeling the way the way people responded, and all the time listening to what they had to say. Now the same approach is to take world newspapers as another outlet through the Tribune Media Services which enables him to run an oped column in 30 papers around the globe. Here is the list: Arab papers are Al Wataan (Gulf States) Asharq Al Aswat (regional paper in Arabic), Gulf News (Gulf States), Saudi Gazette. European papers are: Corriere della Sera of Italy, Die Welt of Germany, International Herald Tribune of Paris, Eleftyropiea (Greece), Kristeligt Dagblad of Denmark, Le Monde of France, Lidove Noviny of Czechoslovakia, NRC Handelsblad of Netherlands, Svenska Dagbladet of Sweden, WPRost of Poland. South American papers: El Mercurio of Chile, Estado Sao Paulo of Brazil, Clarin of Argentina. South Asian and Asian papers: Hindusthan Times/ The Hindu of India, The News of Pakistan, South China Morning Post of HongKong, Straits Times of Singapore, Yomiuri Shimbun of Japan, Bangkok Post of Thailand. In South Africa the Sunday TImes, in Australia the Sydney Morning Herald, and The Australian, and in the USA, the Tribune papers which are Chicago Tribune, Los Angeles Times, Baltimore Sun. These are all distributed through the connection and means of the Tribune Media Services. The key point inthis communication effort is to signal something that may not have sunk in, in many parts of the world. A deep and all pervasive truth that is emerging from this crisis. We are all in this together in ways you can't imagine, as were in one boat and we float or sink in it together. Leave language, culture, borders aside, its aprofoundly new world in which the Obama story itself of multiculturalism may just be scratching the surface of really deep pervasive changes that are happening. Obama may actually not have hit this point hard enough. "Once and for all, we have learned that the success of the American economy is inextricably linked to the global economy.There is no line between action that restores growth within our borders and action that supports it beyond. If people in other countries cannot spend, markets dry up- already we have seen the biggest drop in American exports in nearly four decades, which has led directly to American job losses." This is dramatically proven by the latest Commerzbank estimates that show the 2 largest export based economies, Germany and Japan will see a contraction of GDP of 7%, USA 4% contraction and China, Eastern Europe and other parts of Asia and Latin America will also be impacted severely by the same phenomenon of markets drying up around the globe. And Obama offers the simple message that the United States is ready to lead, and asks its partners in the G20 to join with a sense of urgency and common purpose. Obama goes on to say that " we need not choose between a chaotic and unforgiving capitalism and an oppressive government-run economy. That is a false choice that will not serve our people or any people." ...

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Gordon Brown, former prime minister of Britain from 2007 to 2010, chaired the April 2009 G-20 meeting that came up with ways to tackle the global financial crisis. Brown also led the way by recapitalizing British banks, a step the U.S. followed. He comments on the volatility in financial markets in August 2007 following the S&P credit downgrade of the U.S.. Brown gives an incomplete grade to the tasks the 2009 G-20 set out to accomplish. He points to three goals the G-20 had set in the middle of the financial crisis in April 2009. The first was to prevent a recession from becoming a depression. The other two were to establish a financial stability regime, and a compact for growth. These two became paper promises says Brown. Brown sees the best approach to prevent a lost decade is for U.S. and Europe trading their way out of a downturn as the Asian market absorbs more industrial goods from Europe and the U.S. This includes policies that would keep commodity prices low and ways of coping with currency shocks. Analysts have pointed to an export led recovery as one of the solutions the U.S. was hoping to achieve with a lower value of the dollar. This has had only limited success because of deep structural problems- high consumer indebtedness, bad debt at the banks, weak housing sector following the mortgage crisis, and a rising U.S. deficit- which will take some time to clear. Brown does not come to grips with these underlying imbalances built up during the boom years of the last decade, both in Britain and in the U.S., during which he was the finance minister of Britain....

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Average wage gains for rural areas about 5% between 2001 and 2003, and a loss of 2.5% in wages for the poorest 10% of the people in China are shown in information from the World Bank. This will be of concern to Chinese government as it moves forward with current policy.

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Erdbrink describes the evolution of trade relations with China which helped Iran during the period of western sanctions. Because of trade with the U.S. and western partners, China was careful to use the Bank of Kunlun, created to handle financial transactions with Iran, for import of oil and export of automobiles and other products.