LyrArc Article Gist
News on several fronts in June 2009. On housing, a month to month improvement but still stuggling compared to a year ago levels. The Commerce Department said that an increase in multifamily units led to housing starts jumping 17% in May from April to a 532,000 annual rate. Compared to ayear ago level housing starts was down 45% from May 2008. There were 10 times more homes for sale in April as sold that month, with the typical ratio at 6. With layoff, tight credit and rising mortgage rates laying aheavy hand on these markets, even as developers cut prices deeply to clear unsold homes. On Manufacturing. Industrial production fell 1.1% in May from April, according to the Federal Reserve. Capacity utilization fell to 68.3%. See the graph for the steep drop for auto and auto parts manufacturing. On inflation. The producer price index showed its largest decline in 60 years, according to a Labor Department report. The PPI was down 5% from one year ago, the biggest decline since 1949. It went up from April to May by 0.2%. Part of this was rising oil prices. The core PPI which excludes food and energy dropped 0.1% in May from April. Rising oil prices, a falling US dollar and stabilization in the economy are reducing defaltion risk. At the same time the sign that inflation is not taking root are clearly evident in the slack that is building up with the drop in the capacity utilization rate to 68%, and further declines expected as the auto industry shrinks in 2009, with the huge overcapacity worldwide in that industry. ...

LyrArc Article Gist
The Obama administration delays a decision on the Keystone pipeline till after the 2012 election. State Department officials say they will extend their review of the 1700 mile Keystone pipeline so that Nebraka's objections about the pipeline route affecting drinking water from the Ogallala Aquifier - which provides drinking water to Nebraskans- can be addressed. Kerri Ann Jones, of the Bureau of Oceans and International Environmental and Scientific Affairs, says choosing a new route inside Nebraska will mean a new environmental assessment is required, taking an additional 15 months. In addition to environmental concerns, the Obama administration is concerned about how approval would affect enthusiasm for Obama's re-election in 2012 among environmentally conscious voters. TransCanada officials point out that of the 14 routes considered in the review by the State Department, one route entirely bypasses the Sandhills region and the Ogallala Aquifier, and six routes reduce the pipeline mileage crossing Nebraska....

LyrArc Article Gist
China's strategy for climate change action makes allowance for the need for coal as base energy, and insurance to prevent factory shutdowns from shortfalls of hydroelectric energy in drought seasons. It planned 80GW in 2024 for new coal powered plant construction. 

What should the US do? DJT and Republicans including North Dakota Governor Borghum say the US should also make some room for this in transition policy. DJT calls it "drill baby drill." Yet it is more nuanced than that, it means US will produce natural gas to supply Europe and keep gas and electricity prices down as a cost of living action. DJT knows industry has already put in plans for renewable energy production, it just won't be accelerated in ways that won't let the US economy grow. This is the rational for Alaska oil and gas and rare minerals policies shown alongside this article.

LyrArc Article Gist
This leader in The Economist reviews an essay in the magazine's October 8-14th, 2016 edition by U.S. president Obama. In it Obama points to the unfinished tasks of his presidency and what comes next as tasks to be done for the U.S. economy. The Economist points out the problems in the 2016 election campaign where there is a lack of discussion of economic issues as a serious problem. Obama lists as priorities efforts to improve conditions of people left out in the recovery, reducing inequality, offering more job opportunities, and increasing productivity.

LyrArc Article Gist
The capitalist system has to be made and shaped to human purposes, by responsible caring human beings who care for their fellow human beings, for the world they live in and for the environment of earth, its air, water and trees. And there are consequences in not living in harmony with the natural and human world outside and the spiritual world inside us. Levin hads a son who was a teacher in the New York city schools helping disadvantaged and poor young adults who died in the violence that has become part of this school system. Could Levin with his knowledge and contacts in New York city done something for the very school system that has so much violence and poverty and difficulties with education, working with coworkers like Mayor Bloomberg,on improving the city environment of schools, homes and neighborhoods, as a way of healing the wounds and seeking redemption and quiet for the soul through others?

LyrArc Article Gist
Chief of TechMet a company in mineral resource development says that it will take years to dislodge China's dominance in rare metals mining and development for metals critical to technologies in car batteries, wind turbines, cellphones. This includes nickel and cobalt for car batteries.Last week president Trump signed an executive order declaring a national emergency and authorizing use of the Defense Production Act to speed development of mines. The U.S. imports 80% of its rare earth elements from China, with further supply coming indirectly from the country. For 14 of 35 critical types of minerals the U.S. has no domestic production. Gallium for light emitting diodes in cell phones is one of these metals. Half of Barite a metal used in hydraulic fracturing for shale oil is imported from China. To get some idea of the neglect in U.S.policy in these area under three administrations, the U.S. in the 1980's was the largest producer of rare earth metals and the technology to process them. Today there is only one mine the Mountain Pass mine in California, and no processing plants. It takes about 10 years to develop a mine. Just as in health care products essential to tackle the virus the U.S has found its manufacturing and technology base left in woeful shape after manufacturing and mining were neglected in a failed policy. Under the guise of globalization corporations transferred essential manufacturing from the U.S. and Europe to China, without understanding the importance these products played in the life of countries, and governments neglected to help local manufacturers and mining companies. Governments play a critical role as China has done by providing loans and grants to develop the national industrial base. Tariffs and quotas are also used to promote local development of the manufacturing base and mining base. Another factor is that investors are more able to invest in these companies when the government take some of the risk with its help and active support. With the Trump executive order comes a new awareness in Canada, Australia, and European Union which are now taking active steps to nurture and develop the local resources. ...

LyrArc Article Gist
Saudis make only a modest increase in production of 200,000 barrels a day taking production to 9.7 million barrels a day for 2008. The global market is for 86 million barrels a day with 40% of production coming from OPEC. Saudis make plans to increase capacity from 11.4 million barrels a dya to 15 million barrels a day with increased investments but this is thought to be ambitious. One former president of Aramco the Saudi oil company Edward Price thinks there are resource limits even in Saudi Arabia, as he sees the big fields topping off at 12 million barrels a day.

LyrArc Article Gist
Reaganomics, trickle down economics, it is clear don't work. James Mackintosh says in WSJ, the latest version of Reaganomics, in the form of the LIz Truss budget in September 2022 with cuts in corporate taxes, no relief for vulnerable populations in the cost of living crisis as in all other major European countries and in the US, is already getting a bad reception in financial markets with the tumbling of the British pound.Times have changed there is nothing to be gained in its approach as there are no trade unions strangling growth as in Thatcher's time that need to be restrained, and not that much red tape to increase business flexibility. Most of the privatization has already been done and some of the state run companies are operating much better today than privatized companies handling water and other services.   Instead the problem is one of much needed investment in infrastructure and public services, and social protections after the pandemic. Businesses are not being crippled by high corporate taxes. Instead the opposite is the case, with windfall profits, so that the opposite approach taken by president Biden to use the higher tax on profits of Tech, oil and other companies to finance social protections and a huge climate energy initiative made more sense, leading to the passage of the $369 climate bill  and Inflation Reduction Act of 2022.  The WSJ makes these points- Britain has a higher current account deficit and higher debt at over 100% of GDP compared to the period of Thatcher in the 1980's when debt was only 40% of GDP. Most important is what the WSJ says about what has happened since the 2009 financial crisis and the austerity policies pursued after that crisis that were worsened by the pandemic so that public services in Britain are actually crumbling. Politically this lacks popular support and little backing at a time of a recession in the British economy, because such policies require public support to go through a tough period . And taking this trickle down economics today when Britain faces a cost of living crisis may be an unwise act of taking an approach that is no longer relevant or shown to be working at the worst possible time, says the WSJ. ...

LyrArc Article Gist
The $369 billion climate and tax package that is coming out of a deal arranged by Schumer in the US Senate could be a path breaking action. It would enable president Biden to get close to the climate goals he promised last year of cutting US carbon emissions by 50% by 2030 over 2005 levels to combat effects of climate change. The $369 billion package would get the US to reduce carbon emissions by 40% in 2030 over 2005 levels.  Severe effects of climate change with fires and floods in the US, Europe, and Asia have brought a new spotlight to the issues facing the world and the fact that something needs to be done quickly with the US leading the way. Senator Manchin a holdout because he comes from a coal mining state was a holdout. He was persuaded to join as the new legislation provides for support for transmission lines and other investment during a transition period so that it does not affect the economy in his state. The transition period is now accepted as Europe now looks at gas and coal as a temporary resource following the cutoff of Russian supplies and the US will be shipping more LNG to Europe during this period. The vote for this legislation is planned under reconciliation so that the vice president MS. Harris can cast the deciding vote for Democrats in a 50-50 split Senate. Republicans oppose the legislation. Manchin now says it will reduce inflation. Briefly it will give $7500 to every buyer of an electric vehicle EV, and $4000 for a used EV. It would give rebates for heat pumps that increase home energy efficiency. Billions of dollars would be spent for clean energy industries, and for solar, wind, geothermal, other renewable energy projects. Democrats want to get the legislation through the Senate quickly by next week, and so secret were Schumer's negotiations that most Democrats did not know about it. Coming on the heels of the $280 billion CHIPS and Science bill for $280 billion investment in US semiconductor industry, this will be a big win for president Biden and shows the persistence and patience of Mr. Biden is paying off.   ...

LyrArc Article Gist
Pharmaceutical companies in the US will be required to provide rebates to buyers if they increase prices above the inflation rate. This is one of the provisions in the Inflation Reduction Act of 2022 also called the Climate and Tax bill. Medicare recipients total out of pocket costs for drugs will be capped at $2000 under the Biden bill.

LyrArc Article Gist
Bill Gates of Microsoft calls the Biden climate change bill the single most important legislation in US history. He says only America can offer the vision for climate change action, and make it happen. Gates says he has talked to corporate leaders in America and most of them say they are ready to act once the climate change bill is passed. Many of the industries that need to be created are in the early stages and the climate change bill will create the right atmosphere for sustained innovation.

LyrArc Article Gist
The US has 124,000 charging stations for electric vehicles. The Biden administration wants to see that go up to 500,000 by 2030. For this to happen $7.5 billion is already going to states under the $1 trillion infrastructure bill of 2021. The Biden $369 Climate bill that passed the Senate last week will give companies that build each charging station 30% tax credit for maximum of $100,000, up from $30,000 earlier, to build one charging station. It costs about $100,000 to tear up pavement and build a conduit for a charging station.

Supply chain issues will linger for 2022 and 2023 with shortage of chips after which it will move much faster says this report in WSJ. For EV's to go mainstream charging stations are a priority.

LyrArc Article Gist
What is in the biggest climate bill in history, the Biden $369 billion Climate Bill, also called the Inflation Reduction Act of 2022? The WSJ looks at the bill that passed the US Senate and now heads for passage in the House of Representatives this weekend. 

LyrArc Article Gist
President Biden signs the $379 billion Climate bill and tax legislation into law. Mr. Biden told a White House crowd to standing ovation "This is the biggest Climate Bill ever." At the signing event Mr. Biden tells Senator Manchin  "Joe, I never had a doubt." Senator Schumer quietly negotiated the final bill with Senator Manchin in one crucial week just recently to get it through a 50-50 split US Senate.

LyrArc Article Gist
As president Biden signs the biggest Climate Bill in history Jim Tankersley says there is still more to be done. In addition to the work remaining for children, women and families, he mentions the Civilian Climate Corps with financing for $10 billion that is patterned on the Civilian Conservation Corps set up during the Depression by FDR, which is still to be passed. This would form "the next generation of conservation and resilience workers," says Biden. Much like the 3 million people who helped build parks, cut trails and planted trees around the US in the 1930's and 1940's under FDR.

LyrArc Article Gist
The Obama administration denied approval for the TransCanada Keystone pipeline. President Obama made it clear that the decision was made because of the "arbitrary" February approval deadline imposed by Republicans in Congress, and said this "is not a judgement on the merits of the pipeline." The administration suggested that TransCanada reapply. TransCanada CEO Russ Girling says the company is "fully committed to the construction of Keystone XL, and that it "will reapply for a presidential permit and expect a new application would be processed in an expedited manner to allow for an in-service date of late 2014." Experts say the U.S. could reuse some of the studies and analyses and that the process would take 18-24 months. Alberta's premier, Alison Redford, says she believes the project will get approved.

LyrArc Article Gist
India's current account deficit of 4%- with imports exceeding exports of goods and services- and its small foreign exchange reserves of $293 billion as of April 14, 2012, place serious constraints on building a sizable energy fund to support additional imports of coal and other energy supplies. India is facing severe shortages of coal for the power industry. This places constraints on the country's growth rate. Finance Ministry officials and members of the Planning Commission are looking at setting up a $10 billion energy fund for securing additional supplies of crude oil and coal. Energy imports are placing a strain on India's finances and even the relatively small fund will need money from energy companies in the private sector.

LyrArc Article Gist
A study by the director of the obesity center and professor of global nutrition at the University of north Carolina at Chapel Hill states that based on data collected from 20,000 patients in China over the last 15 years obesity has increased 1.2% a year among men in that time. The study says that more than 25% of the adults in China are overweight or obese and that the number could double in the next 20 years. Its a result mainly of improving living standards which make vegetable oil affordable, and beef and dairy foods more available and affordable. A sedentary lifestyle for many Chinese plays a part as well.

LyrArc Article Gist
Laurence Kotlikoff is a Boston University economist who calls the Obama administration's plans for fixing the financial system akin to "putting a Band-Aid on cancer." He outlines his own proposal in a book just out with the title: Jimmy Stewart is Dead. It calls for taking the risk out of the nation's financial system with "too-big-to-fail" banks, which threaten America's financial system, and may cost huge amounts of taxpayer money approaching by one estimate the entire unfunded liabilities of the Social Security System. He writes in the book that "the problem is the leveraging of the taxpayer by people with no formal training in finance or economics, no personal downside, an assortment of Napoleonic complexes, the money to buy ratings in New York and policy in Washington, and the ability to run circles around regulators." His proposal is to turn banks - intermediaries taking deposits and making loans- into institutions that connect borrowers and depositors with very safe mutual funds created for this reason. Each deposit would be pooled with other deposits in the new kind of mutual fund with all the money held in cash. These mutual funds would supply loans. This strips banks of their risk-taking function. It has attracted attention and support of Columbia University's Jeffrey Sachs and University of Chicago's Nobel Prize winning economist Robert Lucas. Most recently Bank of England's Governor mentioned Kotlikoff three times in a speech to Parliament as ideas worth looking at. With bankssstripped of risk-taking only one single Federal Financial Authority as the national regulator would be needed, instead of the myriad regulators in the current system that have failed in crises. MIT's Simon Johnson agrees that some strong action is needed and compares the need for action with what Theodore Roosevelt had to do to break up the once impregnable Standard Oil. By 1911 the Supreme Court had broken up Standard Oil into 34 companies....

LyrArc Article Gist
Hubbard points out that beyond the public show of confidence Saudi Arabia is a society undergoing change and the future remains uncertain. In Jan. 2015 King Salman, 79, succeeded King Abdullah when he died at the age of 90. With the drop in oil prices and the Saudi role to avoid production cuts, the Saudis have a buget deficit of $39 billion for 2015. Reserves are estimated at $750 billion by the IMF. Saudi policies under Salman will remain unchanged.