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Scott Shane and Jo Becker provide this exceptional account of the events that led to the unraveling of Libya. Saying they were not going to do another Iraq, senior policymakers and president Obama failed to realize the importance of basic steps that needed to be taken to secure the large arms arsenal of the Gaddafi regime, providing the assistance and support for transition to peacetime of the many militias in the country, and arrangements with Arab allies of the U.S. such as Qatar and UAE and other Arab neighbors allied with the U.S. to secure the arms arsenal and secure borders. It was clear from the beginning that Gaddafi had discouraged the development of institutions that would hold the country together- handholding was essential for the Libyan project to succeed. Instead as Shane and Becker document here Libya received neglect with strong conditions set for U.S. assistance such that neglect was assured. It is not clear from this report that Secretary Clinton supported the policy because this is what she would have done, or because of a sense of being a team player in the Obama administration, though it leans on the latter. Observing her role in supporting a Libya free of the dictatorship supports the idea that Hillary Clinton would have seen the need to help build institutions where none existed, and the basic step of transition of militias to peacetime. The weakness of the Libyan government is cited here, which only reinforce the need for the U.S. to be involved in a transition to peacetime Libya, after enabling the Libyan people to remove the Gaddafi regime. The militias allied with Qatar and UAE on opposing sides helped worsen the situation, with the U.S. having sufficient influence with western allied governments to ensure a unified internationally supported policy for transition with basic security....

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Researchers at MIT, Peking University, Tsinghua University, and Hebrew University, have released a report on the dangerous effects of air pollution from the dependence on coal for energy in China. The report shows that areas in northern China north of the Huai River in central China -where coal use is much higher with government support than the area south of the river- have about 5 years lower life expectancy than areas south of the river.

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Garrison Keillor asks the President to "lets start making our way out of Afghanistan," in his own inimitable style. He also quotes U.S. Marine Officer Matthew Hoh, who resigned his Foreign Service post- "American families must be reassured their dead have sascrificed for apurpose worthy of futures lost, love vanished, and promised dreams unkept. I have lost confidence such assurances can be made any more." And Keillor summarizes Hoh's reasons and does it so well- that our presence among the Pastun people, the people in the villages, the rural religious people, is only wosening the conflict, the role of the Taliban and Al Quaeda is not the main thing here, the real issues are tribal and cultural. The last phrase deserves repetition- the real issues are tribal and cultural, which no foreign nation can overcome.

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in Areddy's piece yesterday the 24th in the WSJ he cites 100,000 accounts opening on average this month. NYT here cites 300,000 accounts opening each day. At 300,000, there would be about 50 ,illion new accounts in 6 months and 100 million new accounts in 12 months. Using the 100 million accounts currently open in the Areddy peice we have adoubling to 200 millon accounts in 12 months. What is the right number, and does anybody really know for sure. Anderson of UBS is quoted as saying only 10% of household wealth is tied up in the market, but at something like 200 million accounts, and speculative fever for another 12 months, this could end up with a big chunk of urbanized Chinese the ones most likely to be in the market. If we double the figure of $50 billon in daily stock trading we could see $100 billion in daily stock trading a year from now. The hidden part of the picture is whether Chinese banks have lent heavily to stock market speculators who would be unable to repay the loans in an adverse event and leave the banking sector in worse shape than it is now. Shang, and Guo at the Chinese Securities Regulatory commission and the China Construction Bank are likely to follow Zhou as Governor at the Central Bank. ...

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Saudi global forum on oil price issues meets even as differnces emerge inside OPEC with Algeria, Iran and Venezuela opposed to increasing oil supplies and to a unilateral decision by the Saudis to increase production. After the Bush visit the Saudis increased production by 300,000 barrels a day or 3% to 9.45 million barrels a day. The bulk of the unused production capacity of 2 million barrels a day in OPEC is with the Saudis. The Algerians and the Saudis blame the price increases on futures speculation, lack of refining capacity to produce gasoline in the western countries, and geopolitical tension. For the Saudis and the Kuwaitis there is also resentment that they are asked to use their declining oil supplies while the USA is not allowing offshore drilling and drilling inside its borders to the extent that it could. Note that the ordinary Saudis lower and middle classes are not seeing much change in their lives as inflation is high, and the prices of food and other needs is reducing their purchasing power. Much of the oil price windfall is going into large projects to build aluminium and other plants, and to build new cities in the desert for a growing population, which effectively rechannels the money back to western countries who are actively involved in these projects. The projects themselves may produce value but it is still an open question whether this is the best way to invest this money. And the other serious question is whether this will come at the expense of future oil earnings as the world reduces its dependence on oil. The money is also spread very disparately across the Middle East, with neighboring countries like Yemen in southern Arabia without oil revenues suffering serious lack of development. The political structures like Saudi Arabia created after the first world war by western powers, itself may impede a proper distribution of commodity resource revenues across the region....

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A 35 year old Engineering professor from Texas who studies how transportation systems propagate infectious diseases and her 2 graduate students from China started and since January maintain the database of coronavirus confirmed cases and deaths. This is one of the widely used databases, also used by public health officials in the U.S. The database was started with a hunch from one of Lauren Gardner's students from China Ensheng Dong who comes from Shanxi province, north of Wuhan. A geography and mapping specialist he had studied in the U.S. since 2012, and spent many hours inputting data by hand following his classes. This WSJ report says the website was built in 1 day and was launched on January 22, when the coronavirus cases were practically nonexistent in the rest of the world and were concentrated in the Wuhan area. This report says behind the data reported in the media everyday is a complicated supply chain filled with challenges that come with data, what is reported, underreported and with what assumptions it is reported. Dr. Gardner says she is dealing with so much data on her dashboard, 4000 points of data, that its hard enough to pull all the data scraped together from different sources, its impossible for her to check the assumptions behind the data for consistency and trying to figure out facts underlying the data.  One of the ways the virus developed in the rest of the world is the surprise with which it caught western countries and then the rest of the world. As a result something that the government authorites would do such as the Centres of Disease Control is being done in a totally ad hoc manner. The U.S. government uses the University of Washington Health Metrics database, and in turn the University of Washington Health Metrics database takes some of the data from the John Hopkins database. Because a complacent population in the western countries were relying on numbers counted as cases to know how serious this epidemic was or whether there was an epidemic, the significance of data count from China assumed a signifcance far out of proportion to what it might normally be. This was because the western countries in Europe and America never encountered an epidemic of this kind in living memory, the last one forgotten from 1917 hundred years ago. Researchers in Gottingen University study in Germany conducted analysis of data in studies of cases published in Lancet Journal and found that only 6% of cases were being shown- that a much larger part of the population was infected. A researcher at Princeton University Ramanan Laxminarayan says countries tend to delay reporting until a problem becomes certain, because telling others comes with economic costs such as a rapid drop in trade and travel. Yet he says early warning systems are key to prevention. Early warning from the different publicly available data bases was not possible for many reasons. Relying on such ad hoc data was hazardous considering that as the NYT reported recently when there was the first confirmed detected case reported in New York there were already 10,000 persons estimated to be undetected. James Glanz and Benedict Carey, say in the NYT.com on May 7, that hidden outbreaks spread through U.S. cities far earlier than Americans knew, estimates show, which makes the publicly available databases giving a false sense of security, and not acting as an early warning because of the inadequacy of the resources for this task for individual researchers to handle. Not depending on  hurriedly put together databases with inadequate resources and having an independent sense of what the danger was as German chancellor Merkel described it in her first coronavirus address in March, was a better early warning signal than the databases in retrospect. And this too had come late. The reason is that the response had to be fast, very fast, and public perceptions had to be shaped quickly about the magnitude and speed of enormous proportions of the coronavirus, so that actions could be shaped quickly and executed quickly to stop it in its tracks.    ...

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Mr. Rodrigo Maia, the 49 year old son of the former Mayor of Rio De Janeiro, Cesar Maia, is uniting Congressmen from all parties in Brazil's parliament to get things done and restore lost confidence, such as the recently passed pension reform. Brazil's pension system sucks up most of the money in the budget with overly generous benefits, leaving little to pay for essential public services such as sanitation and transportation. Shockingly sanitation has suffered as only 50% of the sewage is treated in Brazil.  Polls show confidence in parliament after corruption scandals and lack of work to help the people of Brazil with essential public services has fallen to an abysmal low of 7%. Only 50% of Brazil's sanitation is treated and the rest flows as untreated sewage and rubbish into the rivers. To bring some sanity to pensions the Brazilian parliament, with the organizing skills of Mr. Maia to bring parties together around the reform, has cut $240 billion over 10 years from pensions and introduced 65 years for men and 62 years for women as minimum retirement age.  Brazil has 33 parties and Mr. Maia's is with the centre right DEM party. How did this happen. This WSJ story says Rodrigo Maia, 49 years, was born in Santiago, Chile in 1970 during the days of Brazilian military dictatorship. His father was in exile in Chile. The election of a  far right figure Jair Bolsonaro who supported the military dictatorships record as president in the recent election was a warning sign for the different parties in Brazil on the centre right and the centre left that corruption scandals and a do-little spirit was wiping out their influence and destoroying their credibility with ordinary Brazilians. The pension cut reform was their response to gain some of the lost goodwill from the Brazilian people. In the past Brazil's members of the Chambers of Deputies were people of power and influence who held positions for long periods and passed on these positions to people in their families or in their close circle. The elections and democratic governments following years of dictatorship brought in a new class from centre right and centre left that mismanaged public finances and excluded new ideas. The Car Wash scandal and scandals at the state petroleum company under Da Silva's Workers Party led to loss of confidence not only in the centre left party government of Da Silva and the Workers Party, but also in a do-little parliament. The large state spending from the government was possible during the commodities boom from China with Brazilian iron ore and other products getting high prices. WIth the collapse of the commodities boom and lower prices the entire system of state spending has unraveled revealing how much generous pension system is damaging the financing of  basic public services.  Corruption is prevalent in many countries in Asia including India but nowhere has the spending on essential public services such as sanitation suffered as in Brazil. And nowhere was parliament and the government able to get away with staging Olympics, World Cup and building many stadiums, handing out generous benefits to gain public support as in Brazil when basic sanitation and health services were neglected in a shocking way. The health system was weakened to a great extent when it lacked the resources to tackle an outbreak of yellow fever in 2018 as it moved south from the Amazon region towards Sao Paulo and Rio de Janeiro. Protests against the lack of investment in public services such as transportation and bus systems resulted in the public protests in big cities that led to the rise of Jair Bolsonaro in an effort to bring new administration to tackle the problem of financing for infrastructure, public services, health and education.    ...

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"Memories of a Nation," an exhibition on Germany and how it is viewed in Britain, first shown at the British Museum is now being shown in Germany at Martin-Gropius-Bau, from October 8 to Jan. 9, 2017. It gives Germans insights into their own history and how it is viewed in other countries such as Britain. The original exhibition was prepared from objects at the British Museum in 2014, to go with a BBC Radio 4 Series and a book by Neil MacGregor, who came up with the concept in the context of British-German relations. MacGregor, a former director of the British Museum, is now leading a cultural history museum in Berlin called the Humboldt Forum. About 200 objects were chosen to cover 600 years of German history. One of these objects fascinated the British- a hand wagon used by Germans expelled from former German territories to carry their belongings. About 14-16 million Germans were expelled. Other aspects that were shown are the cities of Konigsberg, Strasbourg, Prague and Basel, formerly having German history that has since faded. Also shown the fragmentation of Germany with many states, and the idea of decentralized government, compared to a more centralized Britain. ...

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In the last year of his presidency Obama faces questions about his domestic and foreign policy. Here Greg Jaffe looks back at Obama in 2004 and cites the episode with Farr Curlin, a doctor who opposed abortion and taught at the University of Chicago. Curlin wrote to Obama asking him to consider Catholic teachings when using phrases such as taking away women's rights, at the time Obama won the Senate Democratic primary from Illinois in 2004. Obama came back to the email exchange with Curlin during the fight for the Democratic nomination for president with Hillary Clinton, in speeches and in his book Audacity of Hope, appreciating Curlin's views and calls for openness and understanding of others views. Curlin appreciates Obama's thoughtfulness and sincerity, but points out today in 2015 that Obama has in his actions accelerated the trends in societal change, deepening old divisions. Much of the rest of the article describes the president's anguish at the recent Charleston and other shootings in America, showing Obama as a Christian struggling with his faith. As the article points out Americans have become increasingly disillusioned by the difference between the rhetoric and policy- leaving America deeply divided not just on social issues, but on economic issues with widening disparity in incomes and shrinking of the middle class which some see as accelerating during the two terms of Obama's presidency, and on the issues of foreign policy where 2015 brings the largest number of displaced people and refugees worldwide numbering millions. The lesson of the presidency may be that thoughtfulness is not enough, that thoughtfulness has to be carried into clarity of purpose, that ideals have to be translated into action requiring courage and not avoiding elements of risk. ...

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Fletcher cites statistics from the federal Bureau of Labor Statistics showing that between December 2007 and June 2010, private sector employment in Texas went down by 0.6%. During that period public sector jobs increased by 6.4%. Government employees make up about 17% of the workforce in Texas. The Texas economy gets a large amount of federal money because of military installations and NASA- $227 billion in 2009, according to the Census Bureau. By comparison California received $346 billon in 2009. During the recession period after the global financial crisis of 2008, Texas received $25 billion in stimulus money. Richard Fisher of the Dallas Federal Reserve Bank acknowleges the federal money going into Texas, yet he points out the driving force in the economy of Texas is still the private sector. For the private sector there are several advantages to being in Texas. There are lower taxes- no state income tax and lower business taxes. The large supply of land for development and few land-use restrictions make development easier. Corporate efficiency was a key advantage cited by Fluor when it moved from Orange County, California to Texas. A growing energy sector has helped, along with the growing trade with Mexico. The housing regulations in the state have acted as a check on housing prices, and left Texas with less of the detrimental effects of the housing mortgage crisis than the rest of the nation, especially California and Florida. The governor of Texas, Rick Perry, says he is not against all regulation, and the kind of housing regulation in Texas certainly has played a good role for Texas. Perry's tort reforms have reduced the legal burden on business prevalent in the rest of the U.S....

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Jason Zweig cites the St. Petersburg Paradox in questioning how much someone should pay for a bet on Facebook shares at the high valuation set for this inital public offering. This riddle asks how much would one pay for playing a game in which one gets $1 for winning the first toss of a coin and the game ends, or $2 if the coin comes up heads the second time, or $4 the next time, $8 next and keep doing this , the payment doubles each time. The point is that the payoff is infinite because at each toss the probability is 50% and 12.5% for the next toss, and one could get to the 30th toss or the 60th toss, with payoff in hundreds of millions. People also could be out of the game when the heads come up and not see the later supposed gains. Because of this experts say the most people should pay for playing is $20. The Facebook offering has infinite potential of this sort, but the reality is that for businesses of this type one can only see a couple of years ahead in terms of growth, with large uncertainties ahead about growth beyond that point. Charles Lee, professor of accounting at Stanford Business School, and former head of equity research at Barclays Global Investors, says its hard to see further than two or three years for this type of company. Another problem is pointed out by Prof. Ritter of the University of Florida. He says the valuation is so high today that even if Facebook followed Google's growth and had a total market value of $190 billon that Google has today in 10 years, the annual return would be around 6.8%....

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Pozen calls for smaller Boards of Directors, and suggests about 6-7 directors for a board. Having closer to 11 directors, as is the norm he says, leads to "social loafing" where the directors do not contribute to effective governance. He cites research showing 6-7 is the most effective size for directors to take personal responsibility and take decisive action. This is important as Boards of Directors at GM, Citigroup and other companies failed to take action, leading to a government bailout of these companies. In other cases the situation was less dire, but the Boards failed to provide effective governance. He suggests the board be comprised of people with experience in the areas the company operates in, with one or two generalists to provide a larger perspective. The Citigroup board in 2007 was comprised of luminaries and only one independent director had worked for a financial services firm. The current practice of a board meeting in person every other month for one day, plus conference calls, is just not adequate to stay abreast of the global operations of a company. What is needed is for an outside director to spend 2 days a month on company business between board meetings. For this reason independent directors should be restricted to serving on just two boards of public companies, Pozen says. This would mean having experienced retired persons in the industry, who are over 60. Compensation which is about $200,000 for a board member would be increased to $400,000, as directors would be putting in twice as many hours. Pozen would like to see board members taking their duties seriously, and having expertise in the field the company operates in, making the board duties their primary job rather than an avocation....

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The growth in U.S. GDP was 1.7 % in 2011, yet unemployment dropped by 0.7% in the last 12 months to 8.3% by Feb. 2012. A pickup in hiring is seen in job figures. Christina Romer gives as an explanation to the rise in unemployment in 2009 to 10%, more than expected, and the drop since then, to the overreaction of companies to the financial crisis by laying off workers and freezing hiring- with hiring picking up as conditions return to normal levels. The unemployment rate as defined is also not an accurate measure of the jobs situation, as it reflects only workers who are looking for work, and many workers drop out of the jobs market when they are discouraged especially the long term unemployed. Taking into account people who have dropped out of the labor markets the unemployment rate was 11% in Nov. 2009, according to Luce in the Financial Times- in Ezra Klein, Washington Post 12/12/2011, Wonkbook: Real unemployment rate 11%. Lawrence Katz, Harvard Labor economist also cites this as one of three jobs crises in unemployment today that need to be addressed, the other two being: foreclosures and debt, and the low number of jobs added because of automated manufacturing- in Friedman, NYT, 12/10/11, The Next First 100 Days. Explanations for the low GDP growth as unemployment declines is a likely productivity slowdown. Prof. Robert Gordon of Northwestern University, sees a slowdown in productivity. Worker output for every hour worked, how productivity is measured, increased only 0.4% in 2011 and 0.9% in the last 7 quarters, and is trending downward in the longer term. A more likely explanation is that unemployment is still at higher levels but is understated in unemployment figures....

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Leonhardt points out a couple of problems with Paul Ryan's budget proposal for Medicare. He says Medicare recipients, with the exception of the very affluent, currently haven't paid enough for the benefits they receive. He cites a study that shows Medicare pays out several hundreds of thousands of dollars for the average retiree more than they ever paid in. Medicare funds go for hospital expenses, the rest for doctors bills come from general government revenues. Government borrowing increasing the national debt to unsustainable levels so that current retirees do not have to pay higher taxes, is simply shifting the burden to the next generation. He says the Ryan plan shields those who will retire in the next 10 years because they are a powerful voting bloc, making this more of a political calculation than a bold reform step, as this means younger people will have to bear a disproportionate share of the burden. The other part of Ryan's calculus is that it has proven extremely difficult to reduce the volume of medical care that is consumed in terms of tests, lack of preventive care leading to graver problems, and surgeries. Simply by shifting a larger share of the cost to future retirees this will have an effect on the volume of medical care consumed and put a lid on costs. This is something that needs to happen says Leonhardt, but at the same time all Americans need to share in the higher taxes that are necessary to fund Medicare, exempting 75 million Americans only creates an imbalance in contributions. The other problem with this is that the costs of this exempted group will postpone serious deficit reduction for ten years....

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Michael Birnbaum, the Post, Moscow bureau chief talks to experts and politicians in Moscow about the economic situation as the ruble declines by 36% since July, with the fall in oil prices accelerating its fall and reducing the impact of central bank intervention in slowing the decline. He cites a Putin interview with Tass news agency in Nov. which he says a tieup is possible between the U.S. and Saudi Arabia to bring down oil prices as a way to strengthen the effect of sanctions in changing Russian policy. Russian Finance minister Anton Siluanov says lost oil revenue impact is about $90 to $100 billion a year, added to the cost of sanctions at $40 billion. Significant capital flight also adds to the overall cost. Russian companies borrowing in dollars have large debt payments due that will need to be supported by the Russian government, an added cost. This will put the Russian economy in recession in 2015. The central bank expects inflaion at 10% in 2015. Large losses of this magnitude will be harder to sustain and deplete international reserves of $429 billion as of Oct. 2014. The thinking of ordinary Russians is reflected in an independent Levada Center opinion poll showing 61% of Russians expecting a decline in living standards and economic crisis in the near future. The man most responsible for stabilizing Russia's finances, former finance minister Alexei Kudrin, who had profound public disagreements with president Medvedev over increases in the military budget, warned of an economic crisis following the parliamentary and presidential elections. A major weakness of the Putin-Medvedev second and third terms is the failure to use higher oil revenues to expand the tech sector and other industries to diversify Russian exports away from oil. ...

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A way of gauging the extent of a bubble in the internet IPO's in 2013, says Hulbert, is the first day return on IPO's in the U.S. of 25% in mid-Aug to mid-Nov 2013 compared to 96% in the first quarter of 2000. He cites a study by finance professors Jerry Wurgler of New York University's Stern School of Business and Malcolm Baker of Harvard Business School, which stresses the need to use objective indicators in assessing the current equity markets and not relying on memories alone. Investor caution after two bubbles since 2000, active regulatory oversight of markets, and legal frameworks updated for changes in financial markets have provided additional safety and stability to markets. The study authors cite evidence for the changes in the way investor sentiment values speculative stocks compared to established stocks. The price/book ratio per share or net worth of established stocks is way higher compared to speculative stocks in 2013 compared to 2000. In 2013 established companies in the S&P 1500 index, according to FactSet, had a 49% higher price/book ratio on average than speculative stocks. Wurgler and Baker used dividend paying stocks as "established" stocks compared to non dividend paying stocks as "speculative." Another piece of evidence that companies are also adjusting to sentiment this time is that less money is coming from stock issuance in 2013 of 11% compared to 20% in 2000. Visible evidence of company behaviour is also telling- banks are changing bahaviour after tougher regulatory oversight and settlements in 2013. GE is planning to shrink GE Capital and put it on sale. Investors have sharply cut back allocations to stocks and are returning to modestly higher allocations from much lower levels and memories of 2000 and 2008 are still present....

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Foreign demand for US manufacturing exports especially in emerging market economies such as China, India, Mexico, the Middle East and South America, will help cushion the US economy from the effects of the housing market deterioration and the credit squeeze. Some of the figures point to a vigorous demand for US exports that will sustain the US economy in the years ahead as poorer countries around the world industrialize, urbanize, build infrastructure, and improve the living standards of people in their countries. First the world is less sensitive to US slowdown. Cooper cites numbers to show that the US contributionto world growth has declined from 19% to 12%. And in the past 10 years USA growth declined from 3% to 2.6% annually but the global economy accelerated from 3.2% to 4.4%. (Statistics from IMF?) IMF in World Economic Outlook estimates global economic growth in 2008 to slow from 5.2% to 4.8%, and the US in 2008 to be 1.9% same as 2007. Excluding the US, growth in the world economy would be 5.5%. China's imports of US goods is up 25% annually over the past 5 years. The proportion of US goods going to emerging markets is up to 45% from 38% in the past 2 years. And economies of countries like India and Mexico are sustained by internal consumer demand so they are stronger than before. Another way to see this happening is the US corporate earnings from overseas being up 22% from last year, and domestic profits up only 1%. Over the past year profits from foreign sales have accounted for 80% of increase in overall profits. So foreign trade and its continued expansion will act as a stabilizing effect on the US economy and US products especially in infrastructure development and related areas will help the developing countries make major improvements to living standards and infrastructure. ...

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Becky Branford of BBC News gives five reasons for Emmanual Macron's win in the French presidential election. She cites experts who say Macron was lucky, had a canny ability to see the timing was right for a new party to be formed so that socialist voters had an alternative. His luck comes from the failure of Republican centre right party Fillon to mobilize right wing voters following reports that he had hired his wife and children for government jobs. Yet this is not a complete explanation. Macron had the intuition that something was happening in French politics and the courage to act on it early, the youthful energy to take up the challenge of a mass movement. The events were the declining popularity of the socialists, and the fragmentation of the left wing, the uncertain prospects of the Sarkozy effort at comeback because of his image from years in power, and the need to counter growing far right support for the National Front- to do this by offering an alternative in the centre. From that one courageous decision things from that point fell into place as the Republican party also failed to attract strong public support.  A mere 24% of the vote enabled Macron to enter the second round. Macron's grasp of the economy and conviction helped him win the final debate with Le Pen decisively. His sense of his own mission to revive the idea of Europe sustained him against attacks from the far right, including the late cyber attack on his emails in the last 24 hours.  Macron could still have prevailed over Le Pen without the strong campaign for staying on a positive message and confidence in his ability to turn France's economy around. Yet without a margin of victory of this size in the face of abstaining voters from the far left, Macron as president would not have looked the same. The next step is parliamentary elections in June, and governing France with a turnaround plan requires winning a majority in parliament of sufficient magnitude that he can implement a program which makes the French economy as competitive as Germany's. People forget that Germany was considered a economy with high unemployment and not as competitive under the Schroeder administrations that preceded Angela Merkel, this includes the French with the layers of pessimism. Emmanuel Macron deserves credit not for winning, but winning with the idea of Europe, and it has done as much for him from the French people who have put their faith in Europe when the chips are down, as he has done for Europe already. How this helps put a turnaround in the economy in place is that he will have the energy and enthusiasm of Germany behind him, as well as the energy of French industry and young people to do what Germany accomplished in the 2000-2010 period to emerge from years of high unemployment with a strong economy. ...

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U.S. president Obama called Libya and the policy of not following up on helping establish a stable democratic government in Libya his biggest mistake. Kristof of the NYT says people looking back would say Syria and not establishing safe zones is Obama's biggest mistake. He describes the 470,000 deaths in Syria as a huge tragedy that could have been avoided to a large extent by setting up safe zones. In addition the UN estimates that millions of refugees on a scale similar to the partition of India in 1947 were created.There is bipartisan opinion on this. Kristof cites General Cartwright's opinion in a conversation he had with Cartwright that this should have been done. Others who agree are Madeleine Albright, Bill Clinton's Secretary of State, who spoke at the Democratic Convention about how America helped change her life as a young refugee after Russia's invasion of Czechoslovakia following Prague Spring. Albright says force should be used carefully so as not to aggravate the situation but action taken where needed, something that was done successfully under Bill Clinton in the Bosnian conflict following Serbia's ethnic cleansing policy under Milosevic. Not only that, with the diplomacy of ambassador Holbrooke Clinton was able to negotiate the peace accords that hold till today- a huge achievement.  Kori Schake, director of defense strategy in the George W. Bush White House also agrees. This would have improved U.S. relations with Turkey as this was a key Turkish request. And it would have reduced the dimensions of the refugee crisis in Europe, which has hurt the European Union. The Brexit "No" vote many in Britain have attributed to ads showing refugees in endless numbers streaming across Europe's borders. Similar ads were used in Austria's elections. Kristof points out that Secretary of State Kerry's job of negotiating a peace is difficult in these conditions. Another issue raised by Kristof is the lack of Obama's leadership in helping the refugees in Jordan, Lebanon and Turkey, as he points out only 41% of this is funded. David Miliband former British Foreign Secretary, who heads the International Rescue Committee , says 200,000 Syrian kids are growing up in Lebanon without an education. George Washington counseled against getting involved in the wars on the European continent for a young nation, this advice was not followed in the Reagan and other administrations without showing the carefulness needed before action is taken. As Hillary Clinton has once pointed out the situation has resembled a pendulum swinging in the other direction under president Obama, and former Defense Secretary, Panetta, has expressed similar views. Hillary Clinton and Leon Panetta, Gates, Gen. Jones, served in the first term of the Obama administration, many of these mistakes were made in the second term by president Obama and his White House advisors Dennis McDonough, Valerie Jarrett who clearly lacked the deep foreign policy experience of Hillary Clinton, Leon Panetta (who served under Bill Clinton), and Gates who served under many presidents). ...

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Municipal yields are back up. The Center on Budget and Policy Priorities says states in the USA will have to close budget gaps of $140 billion in fiscal year 2012, ending in June, down from $160 billion this year. But real shortfalls will increase because federal stimulus funds that helped state and local governments will fall from $59 billion this year to $6 billion next year. Local governments depend on states for one third of their revenue, according to a Congressional Budget Office report, which makes them vulnerable. Property taxes account for a quarter of local government revenue and this too will be declining with declining assessed values. The Federal Reserve Act limits open-market purchases of munis to ones with maturities of less than 6 months, which reduces the scope for help from the Fed.

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It appears that P&G and Unilever have caught on to what may be one of the biggest developments in consumer products as the global economy incorporates hundreds of millions of small budget buyers in developing countries from Mexico to India. Just look at the figures here- these high frequency stores like the one in Leon, Mexico mentioned here, bring in per shopper 23 pesos or about $2, with annual sales of about $16 billion. As their incomes increase they could be buyers of the same brands they are accustomed to and move upscale in the years ahead. Another article talked abot Walmart's success in Mexico's urban areas. It appears that there are two trends one of the high frequency stores in the rural areas and the smaller villages and towns, and the other of large stores in the growing urban areas with buyers from the newly affluent urban classes. What is interesting is the close attention that is required to sell to high frequency stores and the sense of respect that needs to be shown for the economy, price and budget, buying habits to tailor products for their special needs. As for example: the one time use Head and Shoulders shampoo that costs 2 pesos, the feminine hygiene pad product with aloe that can be used longer with extra absorbent cotton, the Downy Single Rinse to conserve water usage. All the time the attention to a quality product that delivers and gains sales by word of mouth....