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Average return on U.S. IPO's for 2011 is a loss of 18% for institutional investors getting in on day one according to Dealogic analysis of 23 IPO's. For small investors the losses are 34%.

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An August survey by Japan's Ministry of Economy, Trade and Industry, shows 40% of the country's manufacturers saying they would shift production and R&D facilities overseas if the yen remains at 85 to the dollar. It has dropped below that. Nissan will make 71% of its cars overseas in 2010, compared to 66% in 2009. Murata Manufacturing plans to double its foreign output to 30% by March 2013. By buying Dutch printer maker Oce NV in March, Canon Inc., saw its overseas output jump to 48% for the first half of 2010. Toyota is on track to produce 57% of its output overseas in 2010 , compared to 48% in 1995. The popular Prius will now be built at a plant in Bangkok, Thailand. Sony did 20% of its television manufacturing in Japan in 2010, it is aiming to do 50% in 2011. As a result Sony showed a profit for the April-June quarter, after 6 straight years of losses. Its also important to note that when inflation is taken into account the yen has not strengthened the way it appears, which reduces domestic pressures to dampen the yen's rise. Tohru Sasaki, head of foreign-exchange research at J.P. Morgan Chase & Co. in Tokyo, says that in inflation-adjusted terms, the yen is 30% below the rate it reached in April 1995. U.S. consumer prices have risen by 69% since 1990, in Japan the prices rose only 8.5% during the same period. In inflation adjusted terms the April 1995 exchange rate of 80 yen to the dollar would be 56 yen to the dollar today. Japan's exporters can also benefit from the fact that a large part of Japanese trade is denominated in yen- according to Japan's Ministry of Finance 48% of exports to Asia were paid for in yen in 2009. Like China and Germany, Japan remains highly dependent on exports for growth- which provide two thirds of its growth. The yen's strength increases the outflow of production facilities. In July 2010, 10.3 millon workers were employed in manufacturing in Japan, down from 12 million in 2002. Japan's unemployment rate was 5.6% in 2009....

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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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The President of the American Chamber of Commerce, Harley Seyedin, says that the days when migrant workers did not know their rights, labor laws were not enforced, and factory owners could keep wages low, are gone. With 787 million mobile phone users and 384 million Internet users- which includes migrant workers who can now get the news about the latest developments, send messages, video, and access the internet. For its part the government made serious effort to create awareness about new labor laws of 2008 through the state run media outlets. And workers have greater awareness and understanding of their rights for safe working conditions and double overtime pay, as well as other rights guaranteed in China's new labor laws. And something else is happening that connects the universities with workers. The expansion of the number of students at Chinese universities has brought more people from rural areas into the universities. This has created sympathy and support for migrant workers at the universities. Nine sociologists at Peking and Tsinghua universities signed an open letter calling national and local governments to implement actions that let migrant workers integrate into the city environment and share in the country's progress that they are creating. The government's security system has prevented the creation of a worker's movement in the past. But this time the government may be thinking of the need to develop China's domestic market, as the reliability of markets in the USA and European countries is uncertain as economic conditions change. For this to happen China's workers need higher wages to buy the goods China produces. ...

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The approach of the new Jinping-Keqiang administration to tackle the problem of surging credit growth, with poor quality lending in China's shadow banking system leading to problems of hidden debt and unknown quantity of loans in default. The central bank tightens credit in June 2013 sending a signal to lenders including small and medium sized banks and Trust companies in the shadow banking system that the government will let them default- that they are essentally on their own if they do not follow prudent financial practices.

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Economist Paul Krugman points out the risks of a trade war in the tariffs announced for steel and aluminium by president Trump. Yet he accepts that he advocated stronger action on China's currency in 2009-2010 when the U.S. economy was weaker. In the past on the TPP agreement proposed by president Obama, Krugman said that it would have an insignificant impact as most of the gains on trade were already made. Here Krugman is critical of the language used by president Trump about trade wars being "easy."  This is taken out of context though as president Trump is saying that it is easy in the context of a country enjoying a $100 billion surplus with the U.S., because that country is going to have incentives to maintain a good trading relationship with the U.S. Essentially this means that the steel industry in the U.S. benefits. China also benefits as it closes many of the older steel plants that led to overproduction. This would reduce overcapacity in China's steel industry, a problem China's economic planners see as a priority. China already is making the shift to higher technology products and this process will be accelerated, as it puts less emphasis on steel and metals as it did in its earlier stage of development. As a result contrary to textbook economics this has the potential to be a win-win solution for the U.S. and China in the long run. So little was done under the Bush and Obama administrations to manage trading relationships with other countries so that the interests of small communities across the U.S. were protected from unfair trade- that Reagan administration trade expert Robert Lighthizer took up the cause of the U.S.,workers in these communities. Surveys showed U.S. public opinion also had shifted among educated, professionals and middle class on this issue by 2015, against unfair trade that hurt U.S. interests. Robert Lighthizer is now the Trade Representative for the U.S. in the Trump administration. Reports in the WSJ about the discussion within the Trump economic council, show Gary Cohn favored not imposing the tariffs on steel and aluminum. Lighthizer advocated the tariffs and was able to convince the president.  For Trump this presents a win-win situation, as a mild response by China -and other trading nations that have enjoyed a favorable situation in the past -with its huge surplus and favorable trading relationship with the U.S. would present a win for the president. Economist Krugman accepts this when he says tariffs in the current context of the trading field- that is more favorable to other countries- are not such a big deal, only the use of such policy that is likely to endanger world trade.  As in much of the debate that takes place this adds to the headlines today yet provides delayed and limited relief to communities across the U.S. devastated by world trade as documented by experts who studied trade patterns and their effect on regions across the U.S.  As the WSJ points out in one report the trade deficit itself may continue to grow under president Trump because of other factors. The U.S. dollar surged 8% during the last 2 years of the Obama administration with the economic recovery underway. With Trump's election win the dollar surged another 3%. This may play a bigger role in the direction of the trade deficit than the new steel tariffs announced by president Trump. Workers and unions matter. As TPP pushed by Democratic party president Obama was opposed by the unions, and by the auto industry (workers and auto companies) in the midwestern states which suffered a hollowing out in the last decade. A WSJ survey after the election showed Clinton received 56% support from union workers in 2018 compared to 65% for president Obama in the 2012 election. Some of that erosion in support may come from Obama's TPP stand fervently opposed by the unions and workers in the auto industry. A similar situation took place in Ontario with hollowing out of the auto industry in this large industrial state in Canada and led to the rejection of the Conservative government and election of the Liberal Party under Justin Trudeau. This lesson is so far lost in the Democratic Party's debate.     ...

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Daniel Yergin of consultancy firm IHS describes the geopolitical disputes in the Middle East between Russia, Saudi Arabia, and Iran that are leading to likely continued oversupply of oil in 2016, keeping prices in the $30-$40 range. Saudi Arabia is not likely to change its policy of going after market share, Venezuela is affected but lacks a voice in OPEC decisions, Russia continues its policies in Syria and Iraq under the Putin government affecting other Sunni states, and Iran following the lifting of sanctions is likely to ramp up supply to make up for its lost market share- all leading to an extended period of low prices. This situation benefits China, the European Union countries, India, Turkey and the U.S. in a period of slow economic growth in 2015-2016. Russia looks to use this period of low oil prices to shift to domestic industry after a period of rising imports when oil prices were high. The Saudis seeing their interests in the region threatened by Iran and Russia, and dissatisfied with the foreign policy of president Obama, see a policy of pushing for market share as appropriate in the current geopolitics of the region....

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In nominal terms China's currency, the yuan, appreciated by 3.7% in 2011. The real effective exchange rate, measured on a trade weighted basis and adjusted for relative consumer prices is the more significant rate. The real rate shows the yuan up by 5.3% in 2011, according to the Bank for International Settlements. In November 2011 the yuan appeared to be weakening, and China's prime minister, Wen Jiabao, says China wants to see the renminbi more flexible "in either direction."

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This article in the Economist magazine points out that official data do not accurately show the health of the banking sector, with large number of bad loans at smaller banks. Bank shares it points out are priced in a way that reflects bad loans at 5-10% of loans.

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China's trade surplus rose to $457 billion at an annual rate in the 4th quarter, 50% bigger than in the same period for 2007. Exports dropped by 13% in the 4th quarter but imports dropped faster by 21%, which explains the growing trade surplus. With the stimulus spending kicking in in 2010 imports should pick up just as exports decelerate fast, reversing the direction of the trade surplus.

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Like hundreds of thousands of other young migrant workers in China's factories, Yuan Yandong is from a rural area and lived on a farm. Better incomes have brought them to the factories in urban areas. In this case travelling long distance by train from Guangdong province to Shenzhen. As living standards improved across China and the government expressed a keen willingness to encourage workers to exercize their rights to fair wages and working conditons- especially by creating increased awareness of new labor laws in the state run media- migrant workers are becoming restless with conditions they accepted a few years ago. The growing use of cellphones and access to the internet have made news travel faster. A visit to a Foxconn factory shows a young worker, age 24, sitting on a stool 6 nights a week, 12 hours a night, with a quota to assemble 1600 hard drives for American computer storage company EMC, with the pressure to work continuously against the clock for each step in the manufacturing process. Foxconn is known for its highly disciplined nature of work, akin to a military style. Behind the scenes factories like Foxconn employ methods once used in the US at a similiar stage of industrialization, with 500 technical people continuously looking for the most efficient way to organize each step in the production process. Each movement and action of the worker is measured for time taken and process efficiency, according to experts at Tsinghua University in China. This means many factories can use less automation- and so less capital intensive manufacturing- and go to extremes where workers perform like machines. Yuan's ambition is to work only for another 2 years and then use his savings to get into hotel management. His wages are 75 cents an hour, and with the overtime premium about $235 a month. Foxconn announced a 33% raise in wages as a result of worker protests. The mind numbing monotony is becoming less acceptable in a changing China, and worker turnover in such factories is rising. After the initial burst of industrialization in which young migrant workers played a signifcant role in manufacturing, a new chapter in China's development is beginning- one less likely to create the large trade deficits with the US and Europe- which is moving in the direction of a larger domestic market with higher worker wages....

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Investors showed a lack of confidence in CEO Apotheker's makeover strategy for H-P by exiting the PC and tablet business and focussing on software. H-P's share price dropped 21% on August 18, 2011 to $23.34. This is the lowest price since 2005. About half of the market value has been lost since February 2011. H-P reported lower 4th quarter guidance to $1.12 per share for earnings excluding items.

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Adam Bryant talks to 4 women executives about the problems women face in taking up higher management positions. One of the problems addressed directly and at length by the head of Pfizer Nutrition, Amy Schulman, is what she calls "the dutiful daughter," doing what is expected of you. This is also described as a serious problem for women executives in Asia by Riva Gold, where women not having 100% of the skills for a higher management job will step back, whereas men with only 50% of the skills step forward. Schulman says women have to be well prepared and have a good grasp of the subject matter, have acquired experience, and having done that they need to make their voice heard. Any anxieties about not getting it just right, or asking the question about whether "she belongs" need to be left behind. The leaders of companies need to create the environment in which biases and assumptions about women in the workplace do not hinder getting a mix of different voices in the corporation, which can only benefit from that diversity of people and styles. Another point she makes is that women have to spend their political capital, to stand up for colleagues and the team where appropriate, for principles that are significant, to be build credibility and win credit. ...