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The unravleing of Borders bookstores chain in the US, after Borders management failed to anticipate and build on the new trend to electronic books and made a series of mistakes. Borders filed for Chapter 11 bankruptcy protection in early Feb. 2011. Its online strategies simply failed to come up with answers to the cultural trend to online shopping for books and buying e-book readers. A serious bad decision from which Borders never recovered was to transfer its internet operations to Amazon Inc. in 2001. Amazon quickly built up customer relationships with millions of customers. Other decisions followed which put Borders in an untenable position. Borders increased its debt from $159 million in 2001, to $554 million for the fiscal year ended Feb 2, 2008, using the money for overseas expansion and share buybacks, which did little to address the looming internet problem. By contrast Barnes and Noble took the opposite strategy of paying down all of its $667 million in debt. Borders has modest beginnings starting in 1971, when Tom and Louis Borders, started a small used bookstore. By the 1990's bookstores with tens of thousands of books in one location were changing the bookselling landscape, as smaller bookstores were closing. Borders was able to ride this wave. When the next wave hit in 2010 with the internet, Borders was unable to respond and went into permanent decline. A costly trip through bankruptcy court means Borders will have to close one third of its 674 Borders and Waldenbooks stores, and cut a large part of the 19,500 staff. This will mean customers shifting to Amazon, Barnes& Noble, Apple Inc. and Google Inc. Mike Shazin, CEO of Idea Logical Co, a New York consulting firm, says he expects 50% of bricks and mortar bookstores to go away in 5 years, and 90% to go away in 10 years. ...

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Paul Peterson, a professor who heads the Program on Education Policy at Harvard, says that public school education has not done as well as private or charter school education. In two areas character or values, and school discipline, public schools lag far behind private schools or charter schools. Private schools score 59% and 46% in these two areas, public schools lag far behind at 21% and 17%, in the 2016 Education Next Survey, says Peterson. He says by appointing Betsy DeVos as Education Secretary, the Trump administration sees the need to think how public schools can benefit from improvement in these areas.

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Yan Xuetong, is professor of political science and dean of the Institute of Modern International Relations at Tsinghua University, Beijing. He is the author of Ancient Chinese Thought, Modern Chinese Power. In this essay translated from the Chinese, Xuetong says China's new leaders should borrow ideas from ancient Chinese philosophers and theorists like Guanzi, Confucius, Xunzi and Mencius who pointed to the importance of morally informed leadership as the key to success in the long term. Xuetong presents this as the best way for China to compete with the U.S. At the same time it gives Xuetong a basis for calling on the new Chinese leadership to create a less unequal society, with attention paid to social justice and balanced development free from corruption, similiar to the calls made in the U.S.

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The U.S. Agriculture Department lowered its forecast of corn yield per acre from 166 busherls per acre to 123.4 after a severe drought in the U.S. The projected corn harvest is expected to come in at 10.8 billion bushels, 13% smaller than the 12.4 billion bushels in 2011. The USDA forecast for corn price in August 2012 was raised at the upper end to $8.90 per bushel, up 39% from a month ago.

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Oil from oil sands facilities in Canada is being increasingly transported by rail to the U.S. In the first 9 months of 2013 280 million barrels of oil were transported, double that in 2012, and six times that in 2011, according to the American Association of American Railroads. Exxon Mobil is building a rail loading facility in Edmonton, Alberta, to be finished by early 2015. Rail is receiving attention for safey reasons after a crash in Quebec in 2013. The surge of Canadian crude in the U.S. will affect imports of Mexican and Venezuelan oil,

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The U.S. Treasury Dept reported that Japan's holdings of Treasurys increased to $1.12 trillion in August 2012, compared to China's holdings of $1.15 trillion. Japan increased its holdings as it continued its effort to stem the yens rise. China's holdings are declining.

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Zweig cautions against putting too much faith in experts, or quant models such as "value at risk" or VAR, used by JP Morgan to assess risk. He cites physicist Richard Feynmann: "You must not fool yourself- and you are the easiest person to fool." And the address Feynmann gave at the 1974 commencement of Caltech, in which he said avoid the "cargo cult" mentality of Pacific Islanders who believed that just by standing on runways they could make plane full of food and clothing land, similiar to the ways they did after World War II. Exaggerated returns of over 50% call for more vigilance to look at risks of failure.

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Daisy Maxey of the WSJ talks to 3 financial advisers during Dec. 2014 about how investors should approach stock market volatility, the U.S. Federal Reserve's plan to raise interest rates, and tax issues in 2015. The advisers say investors should not let the volatility affect a steady long term investing strategy. Joel Isaacson says he prefers high-dividend paying stocks over the 10 year U.S.Treasury bonds because of the lack of much upside in bonds. He adds that taking extra risks on high yield bonds is not warranted. The advisers refer to opportunities in areas which are not doing well in 2014 such as in Europe. On tax issues having some money in Roth IRA's is suggested, to have money in tax deferred as well as tax free accounts. Annuities depend on individual situations.

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Fed Governor Daniel Rarullo emphasizes the need for transparency and release to the public of stress test information. The goal he says is to release "this kind of standardized comparable information on a regular basis so that it's not a momentous event."

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Higher oil production in Saudi Arabia in 2012 as the Saudis support U.S. sanctions against Iran.

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About 1.17 million jobs were lost in 2008 according to the Labor Department, with half of these job losses in the last 3 months, as unemployment reached 6.5%. Bu the the labor underutilization rate is the one to watch, the measure of total unemployment including parttime workers who seek full time employment but can't get it. This hit 11.8% in October up from 11% a year earlier. This is what happened in Japan where companies began using parttime workers to reduce costs and not to have to pay benefits, a trend that has already started in the US. See link to trend. Over a long period like 5-10 years this can lead to depressed consumer spending as workers see an uncertain future, as ocurred and is still the case in Japan. Also note that the unemployment rate reached 10.8% in the 1981-82 recession and this is shaping up to be something bigger, and half of the 1.2 million job losses ocurring in the last 3 months so this is accelerating. The economy is expected to shrink at an annual rate of 4% in the 4th quarter, and could see these kinds of declines or worse in 2009 and beyond....

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Important year end reveiw of the oil price forecasting work of so many anlaysts and where they failed . The IEA and the US Enery Dpt forecast have year after year underestimated this pirce by over 20%. Analysts change the price forecasts within a couple of weeks based on changing information and assumptions. Of all this the Saudi Arabian forecasts have ben within 12 % of what has actually ocurred according to a study by Ronald Berger Strategy Consultants of Muich, Germany. And whats their forecast for 2008. By extrapolating from the Saudi budget and the assumptions, used such as giving a wide margin to avoid a deficit in the budget if oil prices undershot by a wide margin, one gets $75 for US benchmark crude. Forecast by experts are in the neighborhood of $80 average for the whole year 2008. Goldman recently revised theirs upwards from $85 average for 2008 to $95 within a 4 week period. How good is the Goldman forecast. No one really knows. Lehman has a forecast of $84 average for 2008 and bases it on the opacity of the market because no one knows what OPEC will do with supply and China does not provide good information on demand. So basically anlysts are adding an uncertainty premium to the price of oil. And this is especially so because as the Chief Economist at IEA says global space capacity is so thin and any event can influence price. Last year the rhetoric about Irans nuclear intentions was enough to stir up the price, as were other smaller events disrupting supplies. But the Iranian situation has since cooled down and diplomatic solutions are in the works. So what to expect in 2008 in the way of political uncertainty. Iraq, Iran, Palestine, Lebanon have all seen a cool off in the ast couple of years and the Bush administration rhetoric has become outmoded as has other rhetoric from Iran so that does'nt look like it will stir up oil prices in 2008. Still there will be some uncertainty premium about supply from OPEC and demand from China and India. And demand from the Middle Eastern oil producing countries themselves as well as the increasing demand in India and China will mean that lower demand in the US because of a recession will still mean an increase in global demand over 2007 of 1.5 million barrrels a day over 2007's 85 million barrels a day. What will change the dynamics of this situation is the government mandated fuel economy for all vehicles on the road with Europe more aggressive in this area under the pressures of global warming. If this impacts India, China and Russia as these fuel saving technologies are transferrred there overall consumption should see an impact. Europe's targets are only 4 years away for 2012. And the environment may cause China to bring in newer technologies that both contribute to improving environment and conserving energy. Because China's environmental record is almost catastrophic one could see some of this happen much sooner than expected after the Olympics in 2008. All that might change the way the world looks at oil and its use, and all energy sources and their use. ...

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Mexico's Congress passes changes to the constitution and new oil legislation which will allow foreign companies to compete with state owned Pemex. Challenges remain in the form of creating transparent regulators to implement the legislation, and ensuring that the benefits of the increased investment in the oil industry benefit ordinary Mexicans through a higher growth rate, using cheaper natural gas to support the manufacturing sector, and additional revenues from the increased oil and gas production tha support health, education and infrastructure development.

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Tougher sanctions on Russia in July 2014 with the addition of Moscow Bank, VTB Bank. Sberbank was not added but other steps limit its access to financing in European financial markets. The limited access to international capital means banks and other companies will have to turn to the government for financing. Growth was estimated at 3.8% and lowered by the IMF to 0.2% in its latest forecast for 2014. It could turn negative, showing the impact both of the emerging markets crisis in early 2014, compounded by the crisis in Ukraine in the second quarter on the Russian economy.

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This Reagon Memo from 1980 was written by his advisors George Shultz, Milton Friedman, Paul McCracken and others before his first inauguration in 1980. It provides the new president with prudent advice on policy and methods to deal with soaring inflation and a stagnant economy. Its relevance today lies in the emphasis on charting out a long term plan for growth by encouraging private investment in the economy and providing a sure framework for the private sector to generate expansion.

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The tensions that exist in Australian society, as a result of the large Chinese investments and imports of infrastructure building commodities such as iron ore, natural gas and other commodities. Australia's Pilbara region in the northwestern part of the country, has become one huge quarry for China, as an estimated 1 million tons of iron ore raw material is loaded onto 2 story high trucks each day- with automated driverless trucks system being implemented- and shipped by 2 mile long trains to waiting ships on the coast. Australians remember this done on a smaller scale in the 1980's by Japan. At the time Japan brought in Japanese workers. The same is true today but on a bigger scale, with China bringing in workers with lower pay. The concern now is what it was then, as one local leader put it- are we going to have towns with mines or mines with towns, he asked. The mining companies are looking at it purely as a commercial venture, and not investing in the towns. The towns now fear they will find the boom times gone someday and nothing tangible to show for it, no schools, hospitals and no infrastructure. And because the mining project companies fly people in and out, the 8000 aboriginal people in Pilbara- the original people of this land- see little of the mining expansion's benefits. Wandoan, a small place with 300 homes in the outback in Queensland, in eastern Australia, is an example of the gut wrenching change taking place in the mining areas. The lives of the people from the local pharmacy, the local supermarket, and the local ranchers, depend on the mining decisions made in China. This area was part of a planned, on again off again, $6 billion coal mine -part of a A$150 billion complex of natural gas and coal projects for exports to Asia in Queensland- and involved Xstrata buying 70,000 acres of the best grazing land for 7 coal mines. With the locals selling off, the mining uncertain, the supermarket closing, the whole town has the feeling of being up in the air, and fading out someday. Australian public sentiment recognizes this feeling, and at the same time is ambivalent about the impact. Polls conducted by the Lowy Institute for International Policy, show 73% of Australians feel Chinese economic growth has a positive impact, and at the same time 57% feel that there is now excessive Chinese investment, and 46% feel China will be a military threat in 20 years. Australians remember the same feeling about Japan's investments in raw material sources in the eighties. In 1988, polls then showed 70% of Australians saying there was too much Japanese investment, even though they also recognized that Australia had benefitted. The difference now is that there are also fears of China's influence, and foreign investment guidelines limit investments in Australian mining companies to below 50%. China's investment in Australia's natural resources comes in several ways: in the year upto July 2009 A$42 billion in export demand, A$3 billion in direct investment in Australian companies, and about A$5 billion in project financing. Iron ore sales to China amount to A$22 billion each year, and about one fourth of Australia's exports went to China, growing at a rate of 31% in 2009. According to the chief economist of Austrade, the government trade organization, Australia benefits from the economic relationship with China- this adds A$3,400 per year to every Australian household. Efforts to use some of the profits made by mining corporations for infrastructure and other public purposes, by increasing the mining tax have failed; as the mining industry launched a campaign against the government of Kevin Rudd, who was removed from office by his party. In the recent national elections, the ruling Labor party lost its majority, after losses in the resource rich states of Western Australia and Queensland. In the meantime the Australian currency has become the currency used by currency speculators who cannot use the yuan to make a bet on the currency- as the yuan is pegged to the dollar- and instead use the Australian dollar as a proxy. This makes it volatile, with the Australian dollar losing 10% of its value in a single day, when pessimism increased about China's growth forecasts. It also shows how much of the good story of employment and gdp growth in Australia is tied to the story in China, and the extent of the negative impact a reversal in this area can mean for Australians; especially now that the bad debt in the post-2008 explosion of bank lending poses risks to China's banknig system. ...

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Paletta looks at the studies made for President Reagan's immigration action in 1986 for information on how president Obama's executive order on immigration in 2014 will impact jobs and wages of undocumented workers. These studies show increase in wages of 5-16% for some workers, as undocumented workers with new legal papers moved to higher paying jobs by the early 1990's, according to Lindsay Lowell of the Georgetown University's Institute for the Study of International Migration.