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The relationship from college years at Amherst College in the U.S. of Greek political leaders Antonis Samaras and George Papandreou. The efforts to setup a national unity government that failed. The increasing support for the opposition New Democracy Party led by Samaras- with 16% unemployment- and the prospect of new elections. Samaras supports spending cuts. He also favors tax cuts, and a flat tax rate of 15% on business. Greece has a long history of tax evasion and distrust of central authority going back to centuries of Turkish rule. Samaras believes that the lower tax rate of 15% would help change the Greek cultural trait of evading taxes becaue it would be on the honor of people to pay such a basic tax. EU leaders are skeptical that lower taxes are the right policy to reduce the deficit. This adds to the political uncertainty as the new government would have to implement the measures agreed to between the current Greek government and the EU leaders. A similiar situation existed in Portugal but the recent elections there, participation of the opposition party in talks, and the newly elected government conducting its own negotiations, has removed that element of uncertainty which exists in Greece. ...

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Allan Meltzer says a Fed QE III woud be bad monetary policy. He puts several questions to Bernanke- how the Fed and Ben Bernanke can know now what is the right interest rate policy in mid 2013, and what reason can the Fed give for adding excess reserves when U.S. banks have $1.6 trillion in idle reserves at the Fed. Meltzer cautions the Fed and other policymakers not to pay attention only to short term forecasts, which can be susceptible to large errors. And calls for attention to the long term consequences of their actions. One point he emphasizes is that the unemployment problem cannot be resolved with short term policy actions nor can it be resolved in a short time. It will take population growth, falling housing prices and rising rents to create opportunities for new construction. Another change is the transition to a less consumption driven and more export oriented economy. This transition which has started will also take time. He urges the Congress and the administration to focus on: reducing corporate tax rates by closing loopholes, long-term reductions in entitlement spending, a 5 year moratatorium on new regulations, and the Fed adopting an explicit inflation target between 0% and 2%....

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Anxiety in financial markets about exposure of French banks to Greece pulled down French bank stocks on August 10, 2011. Societe Generale shares were down 15%. A British tabloid the Daily Mail published an article on Societe Generale saying that it was in a perilous condition, and on the "brink of disaster." The Daily Mail later retracted its report. The rumors spread quickly in a jittery market, reminiscent of the rumors that affected Morgan Stanley at the height of the U.S. financial crisis in 2008. Sanford Bernstein analysts say in a report that the selloff in French banking stocks was based more on anxiety and the rising price of insurance of thinly traded credit default swaps, and not based on rational concerns about earnings and raising capital. Societe Generale says it has no exposure to Greek bonds maturing after 2020 on its books- to deflect fears of additional bank bondholder haircuts beyond 2020- and has taken a 395 million euro provision against losses on Greek sovereign bonds maturing upto 2020. The jittery condition of markets was also affected by rumors that France was about to be downgraded. Moody's, Fitch, and S&P reaffirmed that French credit ratings of triple A and stable outlook would not change....

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Seib cites as a key reason why the presidential race in the U.S. could change- Romney leads by three percentage points over Obama among voters most intensely interested in voting. Another related reason is the plan to reach out to low intensity voters, with the Romney campaign having knocked on 2 million more doors already than they did in all of 2008. Some of the intensely interested voters are more against Obama than in favor of Romney, something Obama experienced in 2008 with the anti-Bush sentiment over the war in Iraq carrying over to support for the Democratic ticket. Another part of the undecided voter sentiment is that more of these voters compared to other voters are dissatisfied with the current condition of the economy and the direction the country is taking. Other reasons that could be cited are the volatile situation in the Middle East which could create questions in voter minds about American resolve in that region, dissatisfaction among some black voters with the deteriorating economic situation for black people, and the lack of intensity among Hispanic voters who feel the Obama administration did not keep its promises on immigration changes, the poor performance of the economy in industrial states of the midwest and east with decline in incomes....

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The 2010 census reveals significant changes in the population mix in the U.S. The number of Hispanic people increased significantly, especially so in the under 18 age group. The Hispanic population went up by 43%, increasing to 50.5 million in 2010, compared to 35.3 million in 2000. Overall Hispanics make up 16% of the U.S. population of 308.7 million. One of the striking facts in the change is that children under age of 18 make up one third of the Hispanic population compared to one fifth for the white population. Texas by itself added 979,000 people under age 18, with 931,000 being Hispanic. 92% of the population growth since 2000-of 25.1 million- came from minorities of all kinds. And mixed race is another major category with nine million people. Asian American population also increased, especially in major cities such as San Francisco, San Jose and New York. Overall 63.7% of people identified as white, 16.3% as Hispanic, 12.2% as black, 4.7% as Asian, 0.7% as American Indian or Alaska natives. New York and Washington saw black populations decline. Detroit dropped out of the top ten cities replaced by San Jose. Chicago's population declined, New York's went up by 2% to 8.2 million people. ...

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The WSJ's Jon Ostrower's intervew with Ray Conner, head of the commercial airplanes division of Boeing. Conner says the era of moon shot type projects is over at Boeing. The Dreamliner project cost $50 billion and ran into repeated delays, with a supply system not ready for the complexity of the project, manufacturing issues, cost overruns, labor issues, and battery failure leading to emergency landing of a ANA Dreamliner in Jan. 2013 leading to grounding of many ANA and JAL aircraft. Boeing's CEO McInerney and Conner see the experience as a lesson for Boeing on the risks of such large projects when airlines are not willing to spend more for revolutionary improvements. Conner cites the example of the incremental improvements in the iPhone since its introduction, with the cost to the consumer not changing much with each new model, as one Boeing would like to follow. Manufacturing improvements are critical to the new model with design needing to include manufacturing process at the outset, reducing complexity, increasing simplicity and improving reliability, as critical goals. As part of this effort Boeing has hired Toyota managers to bring better manufacturing practices, and the focus is now on incremental change and improvement throughout the Boeing organization....

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This report in the Economist says that the days of double digit increases in the car market are a thing of the past. Future increases will be in the mid to high single digits, according to McKinsey consulting firm. China's economy is slowing and official estimates of GDP growth of 7% are described by experts as overstated, with real estimate of growth for the 1st quarter of 2015 by Citi, Conference Board and Capital Economics all below 5%, as reported in the WSJ. A sign of the change in the market is the need for higher use of incentives. The growth in the used car market offers buyers other alternatives. The new plants being added will increase production by 5.3 million light vehicles a year and come online in 2015 and 2016, this is in addition to the 22.8 million in sales in 2014. Average Chinese auto plants operate at 70% of capacity and the added volume will lower capacity utilization further. China's local automobile companies, with the exception of companies in joint ventures with foreign companies, have failed to gain customer loyalty. Many of these companies may be absorbed by foreign car makers or shut down as the industry consolidates. Foreign companies will find doing business less attractive as sales decline. ...

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The suicide note left by CFO Wauthier of Zurich Insurance in August 2013. This followed heated and tense exchanges with chairman Josef Ackermann of Zurich Insurance, who joined the company in 2012. Wauthier says Ackermann created a very stressful working environment and treated managers disrespectfully, putting pressure on the finance department. Ackermann joined Zurich Insurance after a career as investment banker and CEO of Deutsche Bank AG. Zurich Insurance's board said an internal investigation will be conducted on cultural issues about whether excessive pressure was placed on the finance department by senior management. Ackermann resigned immediately. Ackermann had tried to change the culture at Zurich of courteous and quiet internal meetings. His position was non executive chairman but he took a vigorous role. Zurich Insurance was facing a difficult macroeconomic environment and missed three year operational targets set in 2010. Wauthier was a 53 year old dual French-British citizen who joined the company in 1996. He worked in southern California for the company in one position, where he improved his surfing skills. The differences between the hard charging investment banking demeanor of Ackermann and the quiet demeanor with engagement in sports of Wauthier, suggests serious differences in management styles leading to conflict that ended in tragedy....

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Many of the achievements of Jindal in the areas of education, and competitiveness and health care and infrastructure for the state of Louisiana are now at risk because of an anticipated deficit of $2 billion in state revenues for 2009 and in the current year the $865 million surplus has evaporated and turned into a$365 million shortfall all in a short time. The state budget used afigure of $84 abarrrel for oil in calculating the state's revenues related to oil revenues generated in the state from offshore drilling but with oil at $40 a barrel things are not lookin good. The total intake from oil and gas from royalties and leases accounts for 17% of the Louisiana state budget. The state rolled back atax increase and increased expenditures on much needed higher education and health care and infrastructure spending. Louisiana needed these programs because it continues to lose people to migration and is the only southern state to do so. The expected cuts are $109 for education and an additional $160 million for health care cuts much from Medicaid. It also shows how quickly things can change for states that are overdependent on natural resource revenues and in this deep downturn for a range of states from California, to New York to Louisiana....

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How to deal with Bush era tax cuts is a big issue dividing Democrats and Republicans in the U.S. If no deal is reached by Jan 1. taxes on the average middle income family would increase by $2000 in 2013. Median inflation adjusted income declined 8.9% to $50,054 in 2011 from $54,999 in 1999, and economic mobility has fallen. The Democrat's position is for Bush tax cuts to apply to incomes below $250,000. Peter Orszag of the Congressional Budget Office and Jared Bernstein point out that while this makes the tax code move in a progressive direction it also creates handicaps in providing a sufficient revenue base to support middle class spending programs down the road. According to the Tax Polcy Center, if Congress is unable to reach agreement and all tax increases go into effect Jan 1, taxpayers in the bottom 20% of income distribution would see a $412 increase in taxes compared to an increase of $633,000 for the top 0.1%. New York Mayor Bloomberg has supported eliminating the Bush tax cuts for all groups, saying there is no free lunch. Alan Krueger, head of the White House Council of Economic Advisors, says the trends caused by globalization and skill-biased technological change which have increased inequality are likely to continue or accelerate. ...

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The new Jinping-Keqiang administration is making the initial changes in China by restructuring cabinet ministries. The Railways Ministry is being merged with the Transportation Ministry, separating the operation of the rail system from its regulation. The National Population and Family Planning Commission is being merged with the Health Ministry, in a gradual phase-out of the one-child policy after considering the demographic changes underway in China. The State Administration of Food and Drug is being given new powers to fight contamination of food and drugs. The two agencies that manage the media, the General Administration of Press and Publication and the State Administration of Radio, Film and Television are to be merged. The National Energy Administration is to be reorganized to change the way the energy industry regulation takes place. The ministries fall under China's cabinet, the State Council. Mai Kai, secretary general of the State Council, said the ministries remain overly focussed on micro issues. The changes are based on a look at overall development in China and correcting some of the glaring shortcomings in pollution, managing of the rail system, changing demographics, contamination of food and drugs, and other issues that affect the Chinese people in the new industrial and urbanized society....

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The FDIC had $19 billion in its fund that insures consumer's deposits at the end of 2008. A bill in Congress by Christopher Dodd, the Senate Banking Committee chairman, gives the FDIC access to $500 billion till the end of 2010 if the Fed, the President and Treasury secretary support that, and $100 billion without that approval. The FDIC proposed raising the fees banks pay into the deposit insurance fund to buildup the fund, that has been depleted by bank bailouts like the one at IndyMac which cost $10 billion. But banks protested because it comes at a time when bank's are already in a bad condition. Under a 1991 law the FDIC can borrow from the Treasury amaximum of $30 billion. The access to $500 billion is meant to let the FDIC act as another source of funds to address systemic risks that arise in the future, in addition to the $700 billion already approved by Congress for that purpose. In an interview Sheila Bair, head of the FDIC, said that a change in the law would "ease the mechanics of how seamlessly we can access our lines of" funding. I'm the kind of person who likes to be prepared for all contingencies."...

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Areas in which David Cameron shares the same thinking as Barrack Obama are generating green technology jobs, the importance of the voluntary sector and families all doing their bit so that its not just government that will be doing things. "That society should bring about change, not just government." He diagrees with Obama on the Stimulus and believes that the situation in Britain with the government borrowing 10% of national output already makes it difficult to have an extra discretionary stimulus without people losing confidence in then nation's finances. He makes some other points. Britain needs amore balanced economy so that it is not so reliant on financial services. And in Europe as awhole he says its important to deal with the huge dependence on welfare which is a drag on the economies of Europe. This has to be seen in the light of the huge emphasis placed by recent Labor governments on rebuilding the health and human serivces and infrastructure of Britain. In this crisis the social safety net provided by these services may be the reason that asmaller stimulus is needed in Europe. He talks of capitalism with a conscience, where markets are amean not an end to themselves and morality, ethics and asense of values are brough to bear at every turn. ...

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Cars that will be seen at the Frankfurt auto show show the direction the industry is taking. Fuel saving technologies, hybrid engines for cars by BMW and Porsche better know for gas guzzling high performance engines. With environmental consciousness high in Europe the pressures to reduce auto emissions are building up in Germany and the rest of the EU. BMW will show concept car that has the higher ride of a sport utility and the hybrid engine running on gasoline and electricity. BMW is trying to change its image to become more in line with the environmental friendly that the German public requires. Mercedes Benz will show its new fuel saving technology and Prorsche will show a hybrid version of its Cayenne SUV. The other focus in Europe on coming up with smaller cars for sale in Asia and elsewhere, and for light driving in Europe. VW is coming up with a city car concept that cand be sold in Asia and also in Europe, it has a rear engine similiar to the VW Beetle and would come in different body styles that can be built for regional preferences but built off a single platform which is cost efficent to turn out....

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Kenneth Lewis got Bank of America out of the business of subprime lending in 2001. He is the CEO of Bank of America. What is his insight into what is going on today. He sees default risks not depending on credit scores but on other factors such as how much equity homeowners have in their homes. Eveni if its an expensive home over $500,000 there are home owners who have refinanced it and obtained mortgages for much larger amounts in one case upto $800,000, and with hardly any equity in the home. For such a homeowner its easy to walk away from the property and let the lender take the home. Such homeowners would first payoff and be current on credit cards and auto loans and still default and walk away from the home in the current situation. This is what Bank of America is observing. There is a change in social attitudes where its OK to walk away from a home when you don't have much equity in it, and financially it may make sense to get ones finances back in shape. So the old idea about home ownership don't hold good anymore even for people with better credit scores. With this happening banks are likely to tighen credit standards for credit worthy borrowers. ...

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Something bolder like California's at 35.7 miles per gallon target by 2016 compared to the Bush Administration's 31.6 miles per gallon fuel efficiency standard by 2015 would really have a better chance at bringing oil prices down by effective conservation. In fact the gas prices behind the studies at the Transportation department used a price of $2.86 for the years 2011 to 2015 to calculate the rule's costs and benefits when prices are already at $3.50 per gallon today, so the analysis itself is behind the curve and not upto date. This is not likely to stand the test of time as the whole issue of fuel economy is likely to change as time passes. For instance all the three remaining presidential candidates have expressed support for California's efforts to curb gasoline consumption even with resistance from EPA, and the 2 democratic candidates support fuel efficiency above 35 mpg over time. So its realistic to expect that something similar to the California standards will carry the day as time passes and as fuel economy becomes a real big issue as prices continue to escalate and environmental and other considerations also call for better management of fuel supplies through conservation in transportation not just in the USA but around the world....

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David O'Reilly' stock is higher with the media either because he is conscious of the need for a new look at old ideas about oil and its use, and conscious of a new era on how we approach oil as the world is changing and that our thinking must change with it too. So he is not facing the situation Exxon and Rex Tillerson are facing with one of its largest shareholders the Rockefeller family saying that Exxon has tunnel vision and is not doing enough for exploration or for the environment On both of these scores Chevron and Reilly score better in the media image. It could also be Chevron's advertising promoting an image of an environmentally responsible company aware that oil is a limited resource and the need for a changing view. And ofcourse David O'Reilly is Irish and reflects views across the Atlantic which oftentimes are more in touch with the way world is changing than the USA view which tends to be insular. And he is the only one to be CEO of the major oil company leaders who has been around throughout a period when oil went from $25 a barrel in 2000 to $120 a barrel. Here's what he has to say about Oil in an intervew with WSJ: ...

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Land reforms in China to improve rural incomes and increase agricultural production with larger farms to keep food price inflation down two key goals in today's China. And both long neglected in the headlong rush to industrialize and urban centred modernization which left a huge gap which now must be fixed that gap in incomes for the rural 700 million peopr in the countryside who have seen their incomes stagnat and the rural -urban gap widen with farmer protest against corrupt officials seizing land for factories exacerbating the situation for years. Only the 10-12% a year growth has kept the situation under some control as rural folk could depend on income from migrant labor or the young women who left the countryside to work in cities where factories for exports turned out goods for western markets. With this market in serious trouble in debt burdened western societies China may be looking at growth of half the previous rate down to 6%,and so this is move to change the focus to building a bigger domestic market through raising rural incomes as well as urban incomes and shift China's focus to the domestic and Asian markets like India and other Asian countries....

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Christina Pretto, a Citigroup spokeswoman says the company was carefuly managing its employee levels, nothing has changed. Statements like this, a kind of corporatese speak that has been around for years is taking on a new life these days, as companies go through heart wrenching change, yet put on many different faces. Citigroup executives are saying that in addition to the 9100 layoffs expected to be announced next week, another 25% reduction in employees will likely take place by end of 2009, which would take the total employee levels to 264,000 from 354,000. Everyone from investment bankers to the backoffice functions and legal and human resources divisions will be hit. Citi's stock has lost 68% of its value this year, and is now down to single digits. On November 13 Citi fell to $9.45. The company is losing money, and will likely need more government money next year. And Vikram Pandit who has been in the CEO position for a year after selling his hedge fund to Citigroup for $165 million, appears to have lost focus, and with the loss of the Wachovia merger and the opportunity to lure deposits and built up its branch network, it is simply going forward without a strategy....

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Frederick Taylor's engineering time standards for each activity are back now in retailing with H.B. Maynard now called OWO a company that devises engineered labor standardsfor every activity in the cashier line, from greeting to scanning and bagging. The idea is to monitor performance based on these standards. OWO says its methods can cut costs for labor by 5% to 15%. Stores like Limited, Gap, ToyR Us, TJX, Nike, Meijer supermarkets and others use them. If a cashiers falls below 95% of the standard he is watched by a manager and then he receives counselling, after which he may be transferred to a lowerpaying job or fired. Those who cannot handle the stress leave after a year or so on the job. Has OWO considered the impact on older customers who may simply decide not to shop at Meijer as cashiers may end up rushing them. Has it considred the impact on customers who now may not be looked in the eye with a friendly face. There is less talk between cashiers and it can speed up the line but wait there are fewer cashiers now so the waiting time may not change much as the whole idea is to cut labor costs by 5-10%. ...

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Douglas Tompkins co-founded outdoor clothing company North Face and women's dresses company Espirit. He started North Face as a small shop selling high end European climbing and camping equipment in San Francisco. He sold the company in 1969 and later started Espirit. A 1968 trip to Patagonia led to the movie "Mountain of Storms," and a life long commitment to preserving the Patagonia wilderness. A book by Sessions and Devall "Deep Ecology: Living As If Nature Mattered," had a profound influence on Tompkins. For $600,000 Tompkins bought 40,000 acres of land in Patagonia as part of apreservation project Parque Pumalin, which would grow to 700,000 acres of pristine wilderness. Tompkins married Kristine McDivitt, a former CEO of outdoor clothing firm, Patagonia, and the couple dedicated their life to Patagonia through their foundation the Conservation Land Trust. Often misunderstood by skeptical Chileans, and opposed by salmon farming interests, Tompkins set forth his views citing a line from Abraham Lincoln- "Laws change, people die, the land remains." He died kayaking on a lake in Patagonia in 2015. A new generation of Chileans, Argentinians, and others can now appreciate his work in the national parks he helped establish like the work of Teddy Roosevelt in the U.S. a century ago....

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The U.S. Federal Reserve Open Market Commitee takes a position of pause and wait as it decides in March 2012 not to take any new further bond buying stimulus measures. There is uncertainty in equity markets about the effect this will have on equity prices. During the last two pauses in 2010 and 2011 the equity markets experienced downturns after withdrawal of bond buying measures by the Fed, leading to Fed action with QE 1 and QE 2 followed by a surge in equity prices and the S&P at over 1400. At the peak during the 2001 and 2008 dot-com and housing propelled booms the S&P reached over 1500. At this rate the curve for U.S. equity prices for the 2008-2012 period resembles a repeat of a narrow steep V shaped curve with only a 7% climb in April 2012 needed to reach the 1500 point in the S&P 500 average at which the previous two booms in prices ended up in a bust. John Taylor, Stanford economist, in a separate op-ed in the Wall Street Journal on March 29, 2012, called for a change in the mandate of the U.S. Federal Reserve for a more rule based policy because of the dangers of repeated boom and bust periods in the U.S. economy as a result of ultra loose monetary policies. The problem at this point in April 2012 is that profits of companies are not expected by analysts to come in strongly in the second quarter, with a slightly improving unemployment picture, expected upward pressures on oil prices from the Iranian situation, eurozone debt problems in Spain and Italy, and slowing growth in China, India and Brazil. These fundamentals do not support an S&P at the levels seen during the height of the last two booms of 2000-2001 and 2007-2008....

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Every day lost in the struggle with coronavirus is a big thing, which is why Itay's most affluent northern region has gone from being well equipped with resources of healthcare to seeing the health system overburdened to the point of disaster. This WSJ report shows why this has a lesson and an early warning for how the U.S. and other countries should design their response. It is also why the White House team that includes President Trump in the U.S. emphasized the plan for just the first 15 Days in the news conference at the Brady Room in the White House on March 16. It is saying the first 15 days are critical, not a day to lose.  It does not matter if you are an advanced economy with state of the art hospitals. Social behaviours must change, old rules rewritten and implemented throughout nations, quickly in days. Here WSJ shows lessons learned by Dr. Cereda at the Hospital of the University of Pennsylvania who trained in Milan and was in constant contact with colleagues in Milan and elsewhere. Many of the lessons relate to not overburdening hospitals and health systems and protecting health systems. This means mild to moderate cases are managed from home and not in the hospital, through massive deployment of outreach services and telemedicine. It means therapies can be delivered at home or through mobile clinics. The second major lesson from Italy is to protect healthcare workers and doctors. The entire White House team with Dr Faucci of CDC and Dr Brx, head of Infectious Diseases in the U.S. news conference of president Trump March 16, focused on the goal of protecting healthcare workers, doctors and hospitals, so they remained strong to take on the crisis. The second goal of the White House team is to protect the elderly with medical conditions. To do this only the most serious patients are treated in hospitals the rest for mild to moderate at home.  Studying the conditions in Bergamo and other parts of Lombardy and northern Italy, is helping U.S. medical leaders to prepare for the current nationwide effort, the 15 days plan announced by the White House. The lessons from the Papa Giovanni Hospital in Bergamo are important say U.S. medical leaders, including Dr. Brendan Carr, head of emergency medicine at Mount Sinai Health System in New York.  He says build capacity in hospital beds before we need it. Clear out hospital space and add new hospital beds.  ...

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Property sales are estimated to fall by 28-33% in China, twice as earlier forecast by S&P Global Ratings. This is a steep decline that will affect the Chinese economy so dependent on construction. This week there were reports of property buyers in 100 cities getting together to withhold payments on unfinished apartments. Property developers depend on these payments as they have severe liquidity problems and need cash for operations.