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Erfurt is a very German city in the heart of Germany with its many churches and medieval past, the home town of Martin Luther. Katrin Bennhold provides this exceptional report of how Erfurt is coping with new refugees from talking to town officials and observing the process of resettlement. Erfurt has a population of 208,000 with only about 500 Muslims, and few people from Africa. The town's mayor sees it as the biggest challenge since World War II, larger than reunification with the east, as 300 migrants arrive every week and 4000 have to be resettled by Christmas 2015. Under Germany's quota system the state of Thuringia gets 2.5% of refugees, and Erfurt gets 10% of this. When the Soviet bloc expelled 14 million Germans from the eastern territories in the bloc, 670,000 passed through camps in Erfurt. The difference now is the language barrier, and the anxiety among some Germans of how this could change their lives, which is visible from the questions asked at a town hall meeting in Erfurt. Because of the suddenness with which Germany was confronted with the refugee problem it will take time to get organized- in September 2015 there is a shortage of housing space, cots, temporary shelters, translators, social workers, and some of the infrastructure has to be put in on an improvised basis. Rarely has a people come under the spotlight of world attention in modern communications media, in the way small cities and towns throughout Germany are now facing, and providing a glimpse into the hearts and souls of so many....

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In this exceptional report of the housing market in Roanoke, Virgina, Neil Irwin talks to builders, home buyers, renters and young people. San Francisco and Washington D.C. are the exception in housing markets- hundreds of America's midsize cities like Roanoke are seeing smaller rates of household formation leading to a decline in demand for single family homes and fewer homes being built. This accounts for a large part of the smaller growth in U.S. GDP. There are he points out about 2.3 million missing households as a result of a significant change in home buying patterns that is reducing demand for new construction of single family homes. During the period 2001-2006, before the 2008 global financial crisis, the rate of new U.S. household formation was about 1.35 million annually. This dropped to 569,000 in 2007-2013, as the effects of the crisis were felt in a deep recession. One result is more young people are postponing buying a house and living with their parents. Faced with large student debt- the total U.S. student debt passed $1 trillion for the first time recently- purchases of homes are becoming more dfficult. Of 18-34 year olds 27% lived with their parents before 2006, according to Labor Department data. This went up to 31% following the recession. Lack of good jobs is another factor. In 2014 March only 63% of 18-24 year olds had jobs. Even young people older than 24 with jobs felt it necessary to save money by living with their parents. More retirees too are moving into apartments....

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

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Keir Starmeir, a human rights lawyer for 20 years, heads the Labour Party negotiating team in negotiations with Theresa May for a cross-party Brexit deal. He says about 150 Labour MP's would reject a Brexit deal that is lacking a confirmatory second referendum on Brexit. He also said Labour risks losing Remain voters tempted to vote for the Liberal Democrats or Change UK. Starmier said it is time to call time on the cross party talks in a few days.

Recalling his days as a human rights lawyers Starmier says he never thought he would be defending those values of society which were considered part of British society. Starmier says this battle for values is much bigger than one political party.

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Commodities prices hit a low in June before the second Greece election on June 16, with lower unemployment numbers in the U.S. and growth of 6-7% in India and China. Still average prices of oil in 2012 of $115 a barrel are higher than the level in 2011. And corn prices dropping to $5.25 a bushel are still high compared with prices earler. Corn farmers in the U.S. are adding to acreage. The relatively lower prices also give more room for smaller stimulus by central banks to stimulate growth. Freeport-Mining CEO, Richard Atkinson said in a presentation that the growth is coming on top of a bigger baseline for China, India and Brazil. China's copper consumption went up by about 6 million tons a year, averaging 13% growth a year in the period 1995-2010. Now even with slower growth at 6% a year, by 2025 he estimates China's copper consumption at 9 million tons per year. This is a structural change that is supporting commodity prices, says Amrita Sen, analyst at Barclays Capital.

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Bayer CEO, Marijn Dekkers, plans to divest its plastics business, called Material Science. The plastics division requires large investments with lower returns than can be made in health care or the agricultural crop science business. Crop Science generated earnings before interest and taxes of 1.81 billion euros in 2014, and Health Care helped by 5 new prescription drugs reported EBIT of 3.58 billion euros, compared to poor returns of 555 million euros on the polyurethane and polymers used for laptops to soccer balls in the Materials Science division. CEO Dekkers is a Dutch born executive who worked for 25 years in the U.S. Since taking over in 2010 he has brought a significant culture change to Bayer, by insisting on speed and agility from executives. Division heads with marketing backgrounds are preferred to science degrees, and the planning orientation of the company is being changed to one where the company executives are not afraid to take risks based on incomplete information. Dekkers prefers an IPO for the $10 billion plastics business to generate more cash and reduce the debt of 20 billion euros. He acquired the over the counter drug business of Merck for $14.2 billion, and has boosted drug sales with the introduction of Xarelto in partnership with J&J, eye treatment Eylea, cancer drugs Stivarga and Xofigo, pulmonary hypertension drug Adempas. Sales of these 5 drugs are expected to go up from 2.9 billion euros in 2014 to 4 billion euros in 2015, contributing significantly to Bayer's profits. Dekker's venture capitalist type focus on profit margins is showing results in share price performance- Bayer's share price has advanced 60% in 2015 mid-March price of 145.85 euros compared to the prior year month. In the small town of Leverkusen, Germany, where Bayer is located, there were initially fears that Dekkers was "too American" and too focussed on shareholder value to understand the need to respect tradition. Since then Germans have realized that Dekkers understands tradition and is only bringing necessary change- the transition to being a life sciences company makes sense to shareholders in Germany, for employee representatives on the supervisory board the guarantee of current level of 17,000 jobs in the plastics division for a few years shows his concern for job protection during the transition period. For Dekkers who left Holland in 1985, and has a U.S. passport with an American wife and kids who speak no Dutch or German, the important thing is to get the right balance- he says the system of 99-1 where 99% of the information had to be in before a decision could be made is making the change to 90-10 where only 90% of the information is now necessary to go ahead, even if he would like to see it at 80-20. Bayer still sponsors the local soccer team known as Bayer Leverkausen, and 26 other clubs. Dekkers steps down at the end of 2016....

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The bottom line is that China is so advanced in the deindustrialization of the US with US companies cooperating that the only way to get American companies to change course is by creating precisely this kind of situation where China responds with its about 100% tariff to the US 100% tariff. That sends a clear message to American companies and changes the culture of America's deindustrialization American companies are wedded to. Treasury secretary Scott Bessent said DJT raising the tariffs from 34% on April 2 , 2025, Liberation Day by 50% to reach 104%  as a well thought out US tariffs policy was Trump’s “strategy all along.”  Bessent  said: “This was his strategy all along, and that you might even say that he goaded China into a bad position, they responded.” China responded to the 34% DJT tariff by going with it's own 34%. When this retaliatory move suggested China was not willing to consider US arguments that it only wanted a level playing field from China with it's complex system of non-tariff barriers against US imports, DJT added another 50% tariff saying that if China did not withdraw its retaliatory tariff on April 8, US would go with another 50% tariff on April 9. This is what Scott Bessent means by US having put China in a position where it would have to put its own 50% tariff on US products to get to US tariffs at 104% vs. China's at 84%.  The bottom line is that China is so advanced in the deindustrialization of the US with US companies cooperating that the only way to get American companies to change course is by creating precisely this kind of situation where China responds with its about 100% tariff to the US 100% tariff. That sends a clear message to American companies and changes the culture of Aamerica's deindustrialization American companies are wedded to. ...

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This New York Times editorial after the Senate passed a bill in October 2011 calling for action on the misaligned Chinese currency, points to ways a misaligned currrency is damaging for China. It cites the Peterson Institute for International Economics estimate that this is costing China $240 billion a year. This is a result of accumulating huge dollar reserves that have a declining value against the renminbi. Higher import prices lead to higher inflation. And low interest rates on savings, to the point that they are lower than the inflation rate, hurt the vast majority of Chinese and reduce domestic consumption. And perversely this leads to money pouring into speculative uses such as real estate, creating unsustainable bubbles in housing. The Times editorial says China is not generating jobs from this strategy, as the export strategy is relying on use of advanced technology in manufacturing and not creating many jobs. It cites a statistic showing employment has increased by only 1 percent a year from 2004 even with GDP growth above 10%. China is beginning to realize the cost of this strategy, and is planning a shift in its five year economic plan. But this rebalancing has many obstacles. The current system dominated by state run companies, banks, local and federal government, is biassed in favor of the old export led strategy, and experts are pessimistic about the possibilities for change. The Times suggests China may be falling back on the export led strategy as the global economy is slowing. The whole system would have to change after three decades of this kind of development, and would require new leadership and major changes....

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German chancellor, Angela Merkel, appeals to members of the Christian Democratic Party to support the European project at a party convention in Leipzig on November 14, 2011. "We live in times of epic change. Our political compass has not changed. But the context is constantly changing," said Merkel. The 2 day convention used the motto: "For Europe. For Germany." Her message was that it will take years of hard work to fix the crisis and yet this has created an opportunity to put the European project on a sounder footing. Finance Minister Schauble put it succintly as he supported Merkel's appeal: "We now need to build the political union in Europe we never managed to build in the 90's." This comes as changes are taking place in Europe with new unity governments being formed in Greece by Mario Monti, a former EU commissioner, and in Greece by Papdemos, another EU official. And it comes as a head of Italy's central bank, Mario Draghi, who had pushed for stricter controls on spending by the Italian government, is now the head of the European Central Bank. Merkel also hit on the theme of a stricter financial union, and the need for courage to change the treaty underlying the European monetary union to allow strong, automatic sanctions for violations of the treaty. She also emphasized that the government had ruled out issuance of eurobonds that makes the EU as a whole responsible for the debt of individual countries. On that point she said: "Everywhere we look we find behaviour that cannot go on for long. Everywhere people are living as if there is no tomorrow."...

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Problems with China's one child policy are becoming more urgent. New census figures show China's birth rate has dropped to below the replacement rate. Based on the national census in 2010, the figures show the total population at 1.34 billion. The average annual population growth rate for 2000-2010 is 0.57%, which is half the rate of 1.07% in the prior decade. This data suggests a total fertility rate, the number of children a childbearing woman can have at just 1.4, way below the replacement rate of 2.1. This is also happening as the population is ageing rapidly and the gender balance is being skewed because of the bias towards males under the one child policy. The percentage of the population above age 60 is 13.3%, up from 10.3% in 2000. The percentage of the population under the age of 14 declined from 23% to 17%- a big drop. This means that the demographic dividend China experienced is being exhausted. Wang Feng, director of the Brookings-Tsinghua Centre for Public Policy, is one of those trying to get the governmet to change its one child policy. He says the demographic patterns in China were changing even before the one child policy came into effect in 1980. The total fertility rate of 2.3 in 1980 had gone down significantly from the 5.8 in 1950. Indonesia and other countries in Asia also saw signficant drops in the total fertility rate without a one child policy. A large Chinese bureaucracy has formed around the one child policy and it is reluctant to admit the need for change, but policymakers are now paying attention to the facts from the census. ...

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Try this climate change game from Harry Stevens in the Washington Post with your own answers. Data sets from Japan Meteorological Agency and National Snow and Data Ice Center helped build this game. Why is the Greenland ice melting that can cause sea levels to rise 24 feet along shorelines as the Greenland ice sheet melts. It is explained by the idea of Arctic amplification. Arctic sea water is whiter than the ocean. It reflects much of the sun's light and heat back into the earth's atmposphere increasing global warming. Increasing temperatures on oceans creating the kind of effect that created the Acapulco Storm and the Libyan coastal storm very rapidly before storm preparation can happen. And making more of the Greenland Ice Sheet to melt in this process of Arctic Amplification. Note that the Greenland Ice Sheet is based on land so that it contributes to sea level rise.

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The Times looks at the needs of small business and workers in the West Leeds constituency of Rachel Reeves, Britain's finance minister, before the first Labour party budget in decades.

Issues of higher employer contributions for small business, and higher tax from no change in tax brackets, are cited by the owner of 2 gym locations.

Child care is important for working mothers. A business consultant says the local transport system needs investment. Cheaper funding and VAT reduction for a coffeeshop is he started is important for a web designer. A children's shoe shop owner says a tram system for Leeds like the one in Manchester is needed as the decision for a super bus in Leeds made 25 years back clearly has not worked. A rail or Metrorail to Leeds Bradford airport is needed. He also cites cutting importing red tape.

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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.

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Inozemtsev of the Institute of Post-Industrial Studies in Moscow, asks the question wht if the Russian economy shows no growth in 2017, and 2015-2016 become the beginning of a serious downturn. If oil prices remain low for an extended period as now looks likely with factors such as shale oil technologies, Iranian oil, and Saudi policy, playing an increasingly long term role, Russia could face some of the problems former finance minister, Alexei Kudrin, other business leaders including head of Sberbank, warned about. A major problem that Inozemtsev points to is the change in the business climate for foreign investment in 2012-2016 as the Russian economy looks more inward, and the departure of many foreign companies. During the period 2000-2008, a major boost to the economy came from foreign investment which brought with it management and technological improvements. No emerging market country, including China, can have a bright future without access to new technologies and investments from foreign investment. The current period starting in 2009 stands in sharp contrast to the earlier period with the Russian economy lacking the boost from foreign investment, facing capital outflows, and international conflicts creating a long term effect on oil prices. Russia needed time to move its economy away from commodity dependence through technological improvements and investment, yet this does not appear to be happening, raising serious questions....

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Comedian and politician Beppe Grillo, from Genoa, who leads the Five Star Movement party. This party has increased its support from 4% in 2011 to about 18% in recent opinion polls. Grillo is a moderate liberal who has benefitted from the unpopularity of austerity measures taken by prime minister Mario Monti and the rapidly declining support for Berlusconi's People of Freedom party after recent coruption scandals. He has opposed traditional politics of established parties since 2005 when he pulled together people over social media and the internet. Support for political parties in Italy is rapidly fragmenting with Berlusconi's party dropping to 17% in polls and no party having significant support. In this situation business leaders support a continuation of the Mario Monti government beyond the April elections if no party gets a mandate from voters. Grillo says his movement is similiar to other movements that oppose the euro and austerity measures such as the Marie Le Pen movement in France. It is against this background that the Social Democrats in Germany have united behind Peer Steinbruck, a former finance minister, who has the best chance against Merkel in 2013 elections for chancellor in Germany. Most of the difficult and necessary actions that Merkel and the German public have supported are already taken- the changes in labor laws in Italy, France's 2013 budget that targets 3% deficit in 2013, efforts of Italy, France and Spain to improve competitiveness- and capital markets continue to provide vigilance in this direction, creating a situation where Merkel may have exhausted her effectiveness. This creates an opening for a change in policy in the eurozone that offers more German flexibility on stabilizing the eurozone and supporting the embattled governments of Monti in Italy and Rajoy in Spain facing popular protest and not enjoying the kind of support Monti says France has from Germany....

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James Pressley reviews Simon Johnson and James Kwak's new book - "13 Bankers: The Wall Street Takeover and the Next Financial Meltdown. " He suggests reading the first and last chapter for what the authors recommend, limiting banks to no more than 4% of GDP in assets or $570 billion maximum, and investment banks to 2% of GDP or $285 billion. Pressley agrees that incremental steps are not going to change the situation. And the authors have thought this thing through, with Simon Johnson, a former chief economist at the IMF and writer of the Economix columns in the New York Times on the current crisis in Greece, Portugal and Spain. Some of their analysis on that crisis has been borne out by developments, as Greece lurched towards default with the slow response of Germany enlarging the dimensions of the crisis, and requiring a larger bailout for Greece of $160 billion in late April.

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The jobless rate of 7.1% in Germany in April 2011, is down from 7.8% in the prior year. In the states of Bavaria and Baden-Wurttemberg, where BMW and Daimler are located, the unemployment rate is down to 4% in April. Jurg Kramer, chief economist at Commerzbank in Frankfurt, says this could lead to higher inflation. Inflation went up to an annual rate of 2.6% in April. The ECB raised the official interest rate to 1.25% in April, but Kramer says the rate appropriate for Germany is more like 3%. The euro is rising with expectations that the ECB will raise rates further. The euro was at $1.49 on April 28, 2011. Kramer also cites some factors that could slow inflation and wage increases in Germany- most union wage contracts continue till 2012, and the change that allows people from Eastern European countries such as Poland and the Czech Republic to be easily hired.

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Senator Manchin is elected from a state West Virginia, that is the second largest producer of coal in America after Wyoming. This matters with a 50-50 vote US Senate. Manchin is not in favor of a part of the Biden $3.5 trillion families and workers plan which calls for meeting challenge of climate change by speeding the conversion from fossil fuels to clean energy. The clean Energy Performance Program with $150 billion in spending would provide federal funds to energy companies to speed up the conversion. At the COP26 climate change conference in Glasgow the US faces the problem of meeting its own commitments to address climate change as it seeks commitments from China, and India, two major coal users.

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The sectarian tensions between Sunnis and Shiites in the Middle East worsen as the Saudi government of the royal family executes a Shiite cleric, Baqr al-Nimr, involved in Arab Spring related protests in Saudi Arabia calling for change in the country to improve the conditions of minorities. The continuing war in Syria with the support of Iran, the involvement of Russia and bombing of Turkey related ethnic groups, worsen tensions in the Middle East. The Obama administration's efforts to work with Russia to bring a peaceful resolution to the Syrian civil war, cited by WP's correspondent Liz Sly, may have lost credibility with Sunni states because of Russia's bombing campaign in Syria and on the border with Turkey.

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Italy's new prime minister Mario Monti, was frank in his views about depending on austerity alone to meet the debt crisis, views also shared by President Sarkozy of France. Monti told an interviewer from the German newspaper Die Welt, before meeting German chancellor Merkel in Berlin: In the absence of specific help "a protest against Europe will develop in Italy, also against Germany, which is viewed as the ringleader of E.U. intolerance, and against the European Central Bank." He went on to say-"I cannot have success with my policies if the E.U.'s policies don't change." He pointed out that economic difficulties could drive Italy to "flee into the arms of populists."

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VW's global plans to increase sales and surpass Toyota. Efforts to increase sales in the U.S. by redesigning the Passat and having it compete with the Toyota Camry in the same price range of about $20,000. To develop new small cars for Asian markets VW has taken a 20% stake in Suzuki, giving it access to small car technology. Suzuki deal gives VW access to the Indian market. VW plans are to double the network of dealers in China to 1600 in 5 years and a sales target of 2 million cars for China. VW has stumbled before in the U.S. and lacks a presence in Asia outside of China. This is about to change.

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Enrique Pena Nieto of the PRI party wins the presidential election in Mexico with 38% of the vote. Lopez Manuel Obrador came second with 31% of the vote, and the candidate of the ruling PAN party, Ms. Vazquez Mota came in third with 26% of the vote. Voters were eager for change afer 12 years of rule by the PAN party under Vicente Fox and Felipe Calderon. Mexico averaged growth of 2% during these years, though growth has increased since the financial crisis. But the benefits of globalization, foreign investment, and trade reached the better educated and skilled workers leaving many behind. This period included negative growth during the 2008 financial crisis. .

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Libyans in the Benghazi region in the east and in the rest of the country went to vote for the first time in Libya's history. A historic moment even as the eastern region, which has 60 of 200 seats, is calling for higher representation. Under the present arrangement 100 seats go to the west, 60 to the east, and 40 to the south. The transitional government announced a change that a new election will take place for a smaller constituent assembly to write the constitution, with half the seats going to the east. This is an effort to get the support of people in the Benghazi region, which led the fight against the Gaddafi regime.

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Campbell Soup Co. acquires Bolthouse Farms of Bakersfield, California, a maker of high-end juices, for $1.55 billion. By doing this Campbell is shifting into beverages and into fresh foods from its traditional business in canned condensed soups which have a long shelf life. The packaged fresh food category is growing at 7% a year much faster than the canned soup business. This also complements Campbell's V8 vegetable juice products.The soup business is declining because of a change in consumer preferences for simplicity in meals, lack of new products and ineffective discounting. Campbell is planning to introduce 30 new soup items, and packaging in pouches with newer flavors, to get younger people to try its products.