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Anton Troianovski reports for NYT from Geneva on the talks between Russian foreign minister Sergei Ryabkov and US Deputy Secretary of State Wendy Sherman on the Russian proposals for redrawing of the boundaries between Russia and Eastern Europe. Russia has insisted talks take place without the Europeans. The Russian view is that the current borders with strong US presence in Eastern Europe- in Poland, the Baltics, Ukraine, and other parts of Eastern Europe were a result of the new borders being thrust on a weakened Russia after the collapse of the Soviet Union.  The US insists it will not do anything without working with its European allies, but is willing to look for some areas of common ground. European Union and Germany see the new Eastern Europe formed as a result of the self determination of countries in the region, and their right to choose their future. Ukraine was historically close to Russia. After the collapse of the Soviet Union Ukraine had developed two identities with eastern parts of the country closer to Russia reflecting earlier close ties and the western parts of Ukraine closer to Poland such as cities Lviv and Kiev reflecting the mood in Poland and Baltics for an independent Ukraine. Lviv is only 70 kilometres from the Polish border and shows traces of the Austro-Hugarian central European heritage. Kiev is about 300 miles from the Polish border in north central Europe. Elections led to governments alternating between close ties to Russia and distant ties to Russia with the two recent governments opposed to Russian interference in its affairs. President Putin responded with invasion of Crimea and forming an autonomous region in eastern Ukraine. In the latest move Putin seeks to reset the borders in a way that is favorable to Russia.   ...

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An argument for the market economy is that it enables social mobility, so that persons willing to work hard and use talents can do better than their parents and move up in income level.  Yet this is proving to be wrong as there is less social mobility in developed countries, and even less so in developing economies. In the U.S. it would take 5 generations or 100 years, says this OECD report, for someone in the bottom 10% of earners to secure an average income. Even in a country like Denmark it will now take 2 generations or 40 years. In Colombia it would take 11 generations, almost as long as the country has been separate from Spain. Globally, says OECD, the social mobility was better before 1975. OECD's Gabriela Ramos, the chief of staff, says families and communities have been trapped since the 1980's at the bottom rung of the social ladder. In the U.S. 42% of men with low earning fathers end up in the same income level, much higher than the OECD's 31%. At the other end 48% in high income groups see descendents in the same group, similar in the U.S. and Germany. This the OECD says is bad for economic growth in the long run. This "broken elevator" is causing a backlash against the market economy and democracy, disturbing the social cohesion in society. The answer says the OECD, is to provide federal funds to make up for gaps in education so that access to higher education is provided to people on a broad level to include all parts of society. ...

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Values of St Augustine are to be celebrated with Vance, and of Mohandas Gandhi with Harris. Then why the discord? End wars (Biden ending the war in Afghanistan). End migrant incursions Harris pledge to sign the Lankford-Biden legislation into law that fixes asylum entry and Closes the Border with Mexico. Cost of living that hurts the needy and middle class the most. As Applebaum writes about Housing costs Trump has no plan, Harris is willing to put government resources into it. Republicans have their hands tied by a hands off government that is supposed to do nothing and hope everything will work out. That is without corporate housing company greed in a system that doesn/t work -they set the prices too high. As Kristof writes about in the NYT the Republicans will not support paid marital leave, will not support child care assistance, will not support cuts to high pharmaceutical costs, making healthcare unaffordable even to the middle class not to speak of the lower income working class. And will not support investment in the infrastructure that is crumbling around us even as the infrastructure is crumbling around us, like the bridge in Baltimore that went down in minutes. Trump used infrastructure issue in 2016 and rightly so, and talked about it being Infrastructure Week every week, yet did nothing for infrastructure, nothing serious until Biden in 2016-2020. This a continuing project for Harris. Part of this is to end the wars (Biden's efforts in Afghanistan ending it). And end the migrants incursions, Harris 's pledge to sign the Lankford-Biden immigration bill that fixes asylum entry and closes the US Border with Mexico. ...

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Silbersweig of the Brigham and Women's Hospital makes a convincing case for the importance of liberal arts and philosophy studies for pursuing a career in medicine. His studies extend from philosophy at Dartmouth to interdisciplinary studies in psychiatry, neurosciences, at Cornell Medical College, to work in these fields and the physical sciences at Brigham. He says the study of philosophy helped him to ask questions, to work and think in unique ways. Interdisciplinary studies are important combined with interdisciplinary work between people from different but related fields, says Silbersweig. Students have to be willing to be explorers and have the broad and rigorous education to make this possible.

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Orlik reports that the link between China's GDP growth and lending has broken down as credit expansion is accompanied by slowing growth. Slowing credit growth and lowering GDP growth even further is the price China's ecnomic planners are willing to take to forge a new path of sustainable growth, increasing efficiency of investment and increasing domestic consumption. The ratio of China's credit outstanding to GDP has jumped to about 180% in 2012 from 123% in 2008. Rapid expansion of credit is one of the danger signals before a crisis according to the IMF. Turkey and China are facing danger signals according to this IMF danger indicator.

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Michael Gordon of the NYT points out that the nuclear deal with Iran reached in Geneva on Nov. 23, 2013, is largely a holding action and a way to put some constraints on the nuclear program till Iran and the U.S. can work out some major differences. The Obama administration looks to be willing to concede Iran's rights to enrich uranium- it is the strict limits that are needed that are the points of negotiation. The agreement is given in the 4 page document- the Joint Plan of Action which leaves most of the core sanctions in place and lets Iran keep most of its nuclear infrastructure.

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See the piece by Paul Pillar because it says something at the heart of the problem- one of the biggest paradoxes in the rationale for the counterinsurgency. And it is this: the Pakistan government you are trying to help is assisting the forces that threaten it. At the heart of this paradox is the fact that the Pakistan government, military and intelligence services are not all acting together and there are clandestine and some open elements in each of these institutions that support the Taliban. And the official elelments also are hedging their bets and are willing to make adeal with the Taliban if necessary.

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With the German economy stagnating and the FDP partner Lindner as Finance minister not willing to invest in the German economy or in defense, Chancellor Scholz fires Lindner. One of the problems that the Social Democrats accepted in the coalition with the Greens and FDP is the role given to the FDP which has acted as a brake on German investment in the economy. By comparison US president Biden has invested a trillion dollars in the US over the last 4 years for infrastructure, chips, science, manufacturing.The result is that the US economy is in stronger shape. It comes a bit late for Scholz but it shows the urgency of the issue and the need to tackle it as the coalition has lost popularity by sticking with the FDP and not able to offer Germans the program they were elected to accomplish of growth and investment in housing, childcare and other areas of the economy.

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Dan Maffei won his Congressional seat from an incumbent Republican from Syracuse. Others of the 35 first term Congressmen represent a rural, small town and suburban areas like Maffei. And they are not about to lose their seats after tough congressional campaigns, they say, by voting the wrong way on health care reform. As one from Maryland put it he is not willing to foloow the lead just to follow the lead. These are the Congressmen that Steny Hoyer, Rep. from Maryland, who leads the Democrats in the House, wants to give more time as this is what they wanted. And these Congressmen are making themselves heard and making changes in the health care legislation where they disagreed.

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The closing of Project Thunderdome, a project to provide national and foreign articles to 75 newsrooms of Digital First Media Holdings newspapers. The decision was made by private equity firm Alden Global Capital. Digital first newspapers include Detroit News, Denver Post and Salt Lake Tribune. The idea was to consolidate the newsroom. Alden Global Capital gave as the reason cutting costs, and local being where the revenue was generated. In the journalism industry such efforts are being increasingly viewed with skepticism as hedge fund or private equity are focussed on the short term, make abrupt decisions, and are not willing to invest over longer periods the way Amazon founder Bezos is able to do at The Washington Post.

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Eavis of the WSJ says watch the net interest margins (NIM) of banks, as they may not do as well as thought with the government's free money. Margins may be improving According to SNL INteractive banks with over $10 billion assets had net interest rate margin, or NIM, of 3.21% in the first quarter. Well Fargo's declined to 4.16% and Chase' rose slightly to 3.18%. He says the Japanese banks experience with zero interest rates policies shows that these margins can only be improved so much as depositors expect to receive some returns and banks cannot find enough safe borrowers, households and companies, willing to borrow at rates that create high margins.

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This editorial in the WSJ points out that it is not enough for a country to vote to leave the European Union. It must be ready to leave the EU, as it says happened in the case of Greece. Greece was willing to leave the EU but not capable of going it alone. This is true of Britain as Britain cannot bear the economic cost of losing the advantages of trade and commerce without serious consequences. Mrs. May's deal for a permanent customs union, a trade deal that mimics Norway's one with the EU, is not fully supported within her own party. Preserving relations with Ireland and Northern Ireland are important and some Brexit Leave leaders have alienated the Irish.  As the WSJ puts it GDP growth obscured regional disparities and shortfalls in productivity and innovation- so that businesses are right to warn of the consequnces of a hasty Brexit or a no deal Brexit. In short, Britain cannot afford to lose the trade benefits of EU membership. This should have been known from the beginning on all sides to avoid what has been a 2 year long fiasco which will affect Britain's future. A strategic error has been made by Brexit supporters in not thinking things through before launching out into the referendum. ...

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Instead of "ring fencing" bad loans one bank at a time, which is what is being done for Bank of America and Citigroup by the government , Bair, Bernanke and others favor something like the Resolution Trust Corporation, which would contain all bad assets of banks. Bair in an interview said she would like to see them priced at what they would get in today's market, meaning that the steep discounts issue would be faced squarely. What this will need is a lot of government money to restore confidence so that investors are willing to put their private money in the banks. And Senator Schumer says he is hearing the number of $1 trillion or more. This would let banks take these bad assets off their balance sheets, like they did with the Brady bonds for bad Latin American assets and with the Resolution Trust Corporation for bad assets in the savings and loan crisis. It was the original intent of TARP but two things happened, first the pricing of these assets was in limbo, with nobody willing to say how steep the discount should be. The auction process proposed was a vague and shaky one. Second, things deteriorated so quickly that it became urgent to instead do bank recapitalizations for $250 billion. Now the same issue has to be addressed directly by another administration with control of Congress, so that the big bucks funding of $1 trillion can be possible to do. Something like a separate institution that holds all bad bank assets. And the government taking on a big part of the burden, and with it some ownership of the banks that hopefully could payback some of this $ 1 trillion....

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Experts point to several factors favoring a lawsuit by the EU against Google. Google's dominance in Europe is higher than in the U.S., with Google used for 90% of web searches in Europe. The case is easier to build in Europe because the EU commission acts as prosecutor, and EU judges in Luxembourg rarely overturn the commission's major decisions. The EU competition commissioner, Margrethe Vestager, who took office in Nov.1, 2014, sees the need to give smaller internet companies room to compete with Google as a definite priority. She favors setting a legal precedent through a formal court process, and says that "citizens and companies should see that we are willing to go to court if that is the right thing to do."

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This WSJ editorial says GE's decision to exit the banking business follows the U.S. Federal Reserve's move to designate GE Capital a "systemically important financial institution," subject to extra scrutiny by the Fed and stricter regulation. This reduces the potential for higher returns that existed in the earlier environment of limited regulation. It points out that GE was so keen on escaping the "too big to fail" label and stricter regulatory oversight that it was willing to pay $6 billion in taxes to repatriate cash from overseas as part of shrinking GE Capital. In an earlier editorial in 2011 WSJ pointed to the role of GE Capital in the financial crisis of 2008, when GE shares dropped to $6 and GE needed government rescue funds.

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Calls for GM CEO Wagoner's resignation by Senator Dodd, and Obama's statement on "Meet the Press" that if the management team thats currently in place is not willing to make the tough choices and adapt to the new circumstances then it should go. Obama described the approach of current management as a head in the sand approach thats been prevalent for decades now. Jerome York, an expert on the auto industry, called for the resignation of Wagoner and 5 members of the board who have participated in the disastrous decisionmaking and have been there for over 10 years. Austin Ligon, who retired as head of CarMax, also called for the resignation of Wagoner and the board members calling them a disaster.

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Senate Foreign Relations Committee chairman's view of Afghnistan differs significantly from New York Times correspondent Filkins understanding from years of reporting going back about a decade. Filkins sees the complexities of Pastun country inside Afghnistan and Pakistan and the military and ISI's involvement, and other correspondents have pointed to the narcotics trade and corruption. Kerry's simplistic view is that the Taliban do not enjoy much support, when actually Americans are seen on the ground as foreign occupiers. These correspondents in the field point to this as an everpresent danger, which would tilt support to those fighting foreigners, with nationalist and Muslim sentiment prevailing over everything else. And Kerry appears to be too willing to dismiss allegations of narcotics involvement of the Karzai administration with the "show me" comment. For critics of the Bush administration this is simply astounding, when so much is at stake. Does patient mean digging in one's heels slowly? But that is how the Vietnam intervention ran into trouble, without public sentiment in support of the plans....

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Laura Marshall-Andrews is a GP, a General Practitioner doctor, in Brighton, England, with a different approach to patients and health care. She takes into account the whole patient, the patient's mental condition, putting back some of the things that reduce isolation, increasing feelings of self-worth, bringing more community and nature interactions of a positive nature that can affect the patient's health. In some situations having a doctor who listens and is willing to take the time to talk to and know the patient, and being aware of the patient's whole condition as opposed to fragmented areas based on fields of medicine can make a huge difference. Don't look for a diagnosis, treat the whole person,  says Laura Marshall Andrews in her new book- What Seems To Be The Problem? She believes social prescribing takes a whole load off the National Health Service in Britain. This includes art, photography classes, dance classes, singing classes. A study by the University of Westminster shows the GP visits go down by 30% and emergency A&E visits by 25% with social activity prescribing. Yoga, meditation, gardening, nature walks, are also part of the same activities that can help people improve how they feel and think and bring the sense of peace in their lives that brings better health with it. In the loneliness and isolation, community dislocations and pressures of life in today's cities, all these activities are immensely important to the idea of whole health of the whole person. Dr Andrews says that if you keep a community happy and creative, then you are not going to need a lot of expensive hospital treatments." "Cum Scientia Caritas" the motto of the Royal College of General Practitioners means Science with Caring. ...

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On tariffs on Mexico, Canada and China, DJT tells members of Congress -"My goal is not to tax people, it is to change their behaviour." DJT in the second term will not wait for Congress to act- and intends to move quickly on Title 42, Countries on the banned list for immigration, Willing to test courts on ending birthright citizenship as a mistaken rendering of the 14th Amendment, on National Guard assistance to federal Border Patrol efforts at the Border, and on Tariffs on foreign goods. Much of this will be done by 100 Executive Orders even if it goes to the Courts. In the first term there were long delays as DJT waited for Congress to act. Underlying this action is a sense that the American people have shown support for needed action on illegal immigration surges and fentanyl flows that have not stopped over a decade when no strong action was taken by the American government, and foreign governments failed to take the necessary action. ...

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Risk is inherent in investing. It just needs to be understood well and grasped. There is a lesson in here that some risk is necessary, depending on one's risk horizon and it does not have to be Argentine bonds. Argentine 100 year bond and US Treasury 30 year bond returns 2017-2025 show quite a surprise.  50% return for 2017-25 on Argentine 100 year bonds vs -10% on US Treasury 30 year bonds. It shows the nature of emerging market risk says the WSJ- political risk. At one point the Argentine bonds showed a 50% loss, yet investors willing to stick through the downturn did better than expected, much better. The recovery did not start till Jan 2024 though, 7 years later. In this case the risk was the pandemic in addition to political risk of Argentine earlier defaults but the recovery took place years after the pandemic declined and with the election of Milieu as president.

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Dr Kevin Lee, a British neuroscientist, heads EpiNova, a 60 person unit within Glaxo's R&D department. Lee founded two biotech startups before joining Glaxo. The smaller units called Discovery Performance Units are Glaxo's way of creating biotech startup like units which it is hoped will produce better results. The 36 DPU's in Glaxo R&D are given 3 year budgets and flexibility to make their own decisions for drug research. The large bureaucracy, scientists not working across fields and an older mindset are seen as obstacles in the search for new drugs. EpiNova with its own logo operates in a a Glaxo facility, an hour north of London. Decisions are made faster, says EpiNova chemist Dr. Wilson, and the atmosphere is that of a startup willing to try new approaches quickly.

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New proposals from the President tend to go back from his promise of tranparency . Its the administration that will decide under this proposal what constitutes anational security leak. A clear federal standard would let ajudge decide whether national security was affected. In reality the argument goes the other way becauseit hurts the public's right to know, and it does this to avoid embarrassment. Some in the administration want to take this route and President Obama s willing to go back on tranparency pledges he made. A good media shield law that is aclear federal standard in addition to state shield laws would trust the judiciary to decide, now Obama is going back on his pledge for anew era of openness especially when two wars are being fought and there is a global economic crisis.

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GM is willing to sell amajority stake in Opel to the German government. Opel employees want to see that happen, as they say GM never understood Opel's potential. The unions favor this with IG Metall saying about 400,000 jobs will be affected in the car and related businesses with an Opel collapse. And directly at Opel in Russelsheim near Frankfurt the plants employ 29,000 German workers. This is now a big issue in Germany. The bailout of German banks is as unpopular in Germany as it is with Americans, with their own bailout of banks and financial institutions. And Angela Merkel's Christian Democrats are seeing polls showing voters shifting allegiance to the Free Democrats, which reflects opinion of people in smaller independent businesses unhappy with the bank bailouts.

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The Fed announced that it will lend directly to the 20 largest investment banks and is willing to hold different kinds of collateral including mortgage securities that cannot find buyers. In effect the Fed took over Bear Stearns portfolio takes on its risks, will make the decisions regarding the portfolio, and is lending $30 billion with a credit line to manage the takeover and any liabilities that ensue from this. Fed officials stated that Bear Stearn's portfolio by even conservative estimates has enough value to cover the Fed's $30 billon exposure. Ben Bernanke worked closely with the New York Fed through the weekend to get this deal done with JP Morgan and prevent a Bear Stearns collapse that could affect markets when they opened on Monday, March 17th, 2008.

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The FBI and the IRS were working on the same investigation of FIFA from different directions and began working together since Dec. 2011, as they found that the same people were involved. Richard Weber of the IRS, says another round of indictments can be expected. The IRS case starts with investigation into tax fraud and one discovery leads to another in the case. By 2013 Chuck Blazer had pleaded guilty to tax and corruption charges and agreed to cooperate with the IRS and the FBI, leading to the breakthroughs that followed. Enhanced cooperation between the Justice Department and international banks since the indictments against banks for illicit operations has made banks willing to cooperate with investigations fully. Once the case was built up getting FIFA officials at one place for the meeting in Zurich made it easier to make the arrests.