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In an interview with the Wall Street Journal, Mark Carney, the head of Canada's central bank and the head of the Financial Stability Board, says China is falling behind in its earlier committments made at G-20 meetings to move towards rebalancing the world economy. He pointed to the fact that consumption in China has moved from about half of China's GDP to about a third, in the last ten years. China's investment has also declined from half of GDP to about one third. Carney also raised concerns about the strength of the Canadian dollar for Canada's competitiveness. The report "China: 2030" by the World Bank and China's Development Reform Commission also calls for changes in the way China's economy has increased its dependence on state run companies.

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Easwar Prasad, Cornell University economist, and a former head of the IMF's China division, says the new report by the World Bank and the Development Reform Commission (DRC), is part of an effort by government officials in China to push the agenda for change forward during the transition to a new leadership. This includes Premier Wen. There is pushback from large state enterprises. The DRC and the World Bank had called for a change from the current situation to allow more private sector involvement in the economy, which means restricting the growth of the large state owned companies and letting the private sector operate in more parts of the economy. The alternative is to see growth slowing quickly and -some economists- say suddenly without warning. The role of Zhu Rongji, a former prime minister during the period Jiang Zemin was president, in pushing for changes appropriate to the period, is also cited. The last decade under prime minister Wen Biao is seen as one in which China relentlessly pursued its currrent export led model of development with large state run companies and state run banks dominating the economy. This has made change even harder to achieve because of the pushback to preserve the status quo....

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Krugman questions whether the assumptions behind the austerity policies are true- that they would inspire confidence in economic recovery, or that in the absence of austerity policies borrowing costs would go through the roof. The recent events in Holland with the collapse of the government in the Netherlands- when a party leader supporting the government said he did not want to hurt pensioners in the Netherlands just to satisfy German opinion- and the mood in France with economic anxiety vote going to Marie Le Pen and Francois Hollande in the first round of presidential elections, shows that very little confidence has been created. High unemployment and economic anxiety are leading to a reappraisal of austerity cuts that depress the economy and reduce tax revenues, but Krugman says no changes are taking place to correct these policies. This is true for Spain with its high unemployment, and Britain which now has two quarters of negative growth.

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Interview with Honda CEO Takeo Fukui. In June Honda will rollout a new hydrogenpowered fuel cell vehicle called the FCX Clarity. Its powered with electricity produced by combining hydrogen and oxygen in batterylike fuel cells. Honda will have this vehicle available for lease this summer in California and aims to deliver about 200 of these cars by 2010. Fukui's attitude is refreshing when compared to that of other automakers when answering a question by John Murphy of the WSJ about why try to build a hydrogen car when the stations to power the cars do not exist yet. He tells Murphy if you asked were there any gas stations when Henry Ford came up with the Model T, there weren't any, lets build the cars first and the infrastructure will follow. And Honda is working on the technology that will make it possible to charge hydrogen into fuel-cell vehicles at home . He sees it happening first in California and some other states, and in Japan and Europe. And he sees it taking about 10 years to get some sort of infrastructure in place. Considering the long term nature of the demand side with the gradual inclusion of billions of people in China and India as well as Brazil and Russia into the world economy as well as people in other developing countries this is a solution that takes patient and focused development of technology which Honda is setting out to do. He does not see a safety issue in use of hydrogen vehicles as he is confident Honda can develop the expertise to handle the safety issue for hydrogen. What is his thinking on green vehicles? What happened to the Insight the first hybrid car that Honda introduced? The Insight was never intended to be a mass seller, only to establish Honda's record as having the best record in fuel efficiency. What is Honda doing in this area. Honda does see a problem in this area. Toyota he says developed a green image largely on the back of one car the Prius. Honda will come up in 2009 with a dedicated hybrid vehicle to match the Prius. And Honda is setting the bar high for this Honda hybrid, saying that his feeling that this model will have to overwhelm and overtake the Prius. He goes on to say that this is key for us. Honda he says will take on the challenge and compete with Toyota with its products, its technology, and its racing spirit. This gasoline-electric hybrid will be introduced early next year in the USA, Japan, and Europe, and it will be the first of 4 hybrid models Honda will introduce by 2015. Regarding price the company says it will be "affordable". Honda's goal is to sell 500,000 hybrid vehicles a year. Toyota aims to sell 1 million hybrid vehicles early in the next decade and is working on developing its own hydrogen fuel-cell vehicle. Is Honda developing electric cars? Takeo Fukui thinks the practical feasibility of the electric vehicle is very limited. The two biggest issues in his view being driving distance and recharging time. The FCX Clarity can be recharged in one minute, compared to the several hours for an electric vehicle. In his view the electric vehicles will be uselful only for restricted applications like golf carts. Nissan and General Motors are planning to launch electric vehicles. What is Honda's environmental strategy? Honda being a smaller company has to focus its resources wisely with strategic choices. His focus is on the hybrid as the core product, and after that comes fuel cell and clean diesel as the core products to tackle fuel eficiency and CO2 issues. Takeo has spent more than a decade on Honda's racing teams. He drives a CR-V and enjoys driving up and down the mountains, does not race but does get on Honda's test track once or twice a year. And what has he learned from all the years in racing. When he was fully engaged in the motorcycle racing teams he says the pressure was very high and if they did not do well they got bashed by managers and the media. And actually the results were disappointing for years and the teams kept losing. For hime the series of difficulties and challenges was something that he feels everyone should experience because in some ways he acquired wisdom and creativity to get through these experiences. This is some thing Honda and Fukui will need as they try to develop their own hybrid to take the lead from Toyota and come up with industry leading technology in tackling fuel efficiency and CO2 issues. His own approach to management? Two things he always keeps in mind are take time to keep up good communication with associates at work, and testing Honda's own products with his own hands. What does he think about the auto industry in 2008, is it a turning point? He says it has becom clear in 2008 that a company has to have the technology to deal with carborn dioxide and fuel efficiency issues. And its clear that smaller vehicles are more attractive than larger vehicles. And its possible he says that we may go back from automobiles to motorcycles. In fact in India Honda is promoting motorcycles in a big way, while Tata is developing the Nano for mass market, so Takeo is talking about something that Honda sees happening in some places. ...

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First signs that OPEC may relent on production increases, as price of oil takes a new turn and becomes driven by forces that are beyond what OPEC may either foresee or be able to control. OPEC's different oil countries' senior officials are probably studying these new signals. Shukri Ghanem of Libya, a former prime minister and former head of Libya's national oil company, comments on new developments and shows willingness to increase production, to support a meeting before September and to look at the option of increasing production is his comment to Bloomberg News, May 8, 2008. Shukri was trained at the Fletcher School, Tufts Unversity, with a Masters degree in International Economics, and may have a better understanding of what is happening in international oil markets than senior officials of other OPEC countries. The signals that OPEC as well as the rest of the business community are watching are first the estimate by analysts at Goldman Sachs, Deutsche Bank and CERA's Yergin that prices are headed in the direction of another spike to $150 to $200 per barrel before coming down sharply. Ghanem and others at OPEC may find that it is not in their interest to actually lose all control of prices if this happens, that is lose the market stability that enables a cartel to do well. Price spike would generate huge spike in revenues for a short period 6-12 months before setting up for a big fall as a result of setting in motion a whole set of new forces in the use of oil. Some of this are much higher and aggressive automobile fuel efficiency targets for Europe, the US and also in places like India and China, conservation in a big way, fuel efficiency in other uses such as generating electricity and other industrial uses in plants and so on, almost like the race to the moon, with new urgency. The spike in revenues followed by a drop may actually hurt OPEC long term revenues over next 5 years as the moderation in growth in developing countries like China and India is quite likely as the US slows down and this would only accelerate the pace of this moderation. With focus on efficiency in the use of oil worldwide, accelerated new production in non-opec oil fields, and moderated growth worldwide, enough savings could be generated in 24-36 months to bring oil prices down from the demand side and reduce speculative investments. The second signal was a WSJ survey of 53 respondents n this case economists, and 51% of the economists surveyed said that the oil price rise's key reason was on the demand side from developing countries. And speculation was a smaller factor attributed to by 11% of the economists. So the combination of these 2 factors added up to 62%. Foreign exchange was cited by 15% of the economists, adding all three factors would attribute 77% of the rise in oil prices to demand from developing countries, speculation based on rising demand, and the weakness of the dollar. If demand the key element in this drops as a result of an even bigger spike in oil prices to $150-$200, with demand moderating in developing contries, and the dollar strengthens in 12-18 months, then the spike would be temporary, leading to significant correction afterwards. This sharp correction would then become entrenched as the world would look at oil in a new way entirely different from the way it did in the years 1945-2007. ...

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Tourists from China went up by 20% in 2015, going over 1 million. Foreign enrollment at Australian educational institutions was up significantly in 2015, going up to 645,000, up 25% over 2012 with the weaker Australian dollar. Australia's services sector including inbound education and tourism exceeded in value the minerals and metal ores exports in the last two months of 2015. This enabled the Australian economy to grow by 3% in the 4th quarter of 2015 over the prior year.

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To correct misgivings in many quarters about Syrian refugees not finding a haven in Gulf states, this letter from the Cato Institute points out that the population of Syrian refugees living in the Gulf states including Saudi Arabia has gone up by 1.1 million by 2013 from the beginning of the civil war. He cites World Bank data showing 241,000 Syrians living in the Gulf states before the civil war. By 2013 that number is 1.4 million. For Saudi Arabia the figures are up from 111,000 to 1 million.

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The OPEC meeting in Qatar in April 2016 to stabilize oil prices with a freeze in production is not likely to affect supply and demand. Saudis and Russia are producing all out, and Iran plans to increase its production, making it difficult to reach an agreement. The International Energy Agency, IEA, predicts demand will rise by the end of 2016 from 94.8 million barrels a day to 95.9 million barrels a day. Production is at 96.4 million barrels a day, and this is expected to lead to narrowing the gap between supply and demand. Experts say cars are becoming more fuel effficient, and electric car technology is becoming commercially viable, leading to a lack of growth in demand in developed and middle income countries. This may have to be factored in for the intermediate and long run for demand growth.

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Instead of going through layers of executives before speaking to the CEO, quality chiefs at Toyota now speak directly with the CEO. Mr. St. Angelo who heads the Quality group at Toyota for the American region met directly recently with Mr Akio Toyoda. There are in all 6 Quality chiefs for six regions worldwide. Akio's questioning during a Congressional investigation appears to be a turning point and he is determined to shake things up. He choked up at the National Press Club in Washington while thanking employees and dealers for their support. See the links to Akio Toyoda for Akio's education and experience in the U.S., which may have better prepared him for this challenge than his more parochial mindset predecessors who lacked this type of background.

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Zarkadakis points to modern Greece's burden of history since the struggle for freedom from the Turks in 1821. The resurgence of European interest in ancient Greece, he says, burdened modern Greece with a narrative of their identity based on romantic and idealistic notions of Europeans in other nations. It also burdened ordinary Greek people with learning three Greek languages, including the language of the ancient Greeks. Failure to live up to the expectations of the intellectual classes of Europe from their perceptions of a distant past led them to look down on the people of Greece- as evident in perceptions in the German media about Greeks as lazy (the Mediterrranean peoples and lifestyles not as hardworking as the Germans) and liars (the national accounts being largely fudged till a Dutchman at the IMF presented the correct picture in 2009), and cheats (extensive tax evasion). He says this ignores the national traits of Christian Orthodox (which would suggest "mercy" or significant forgiveness of debt when debt reaches a point of becoming uncollectable) the economic history of successive defaults in 1893 and 1932 (lack of economic maturity), a strong cultural trend that tends to circumvent the governing authority. The desire to modernize Greece of the intellectual classes and governing politicians in Greece, and the dependence on the European Union as the sole guarantor of such modernization, has he points out led to a sort of arrogance that ignores the anxieties and fears of the ordinary people of Greece. This was evident in the way efforts to get a referendum on the austerity plans imposed on Greece were quashed by EU officials and the Greek politicians. ...

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Analysts see the likelihood of Greece exiting the eurozone at over 50%. The actions of the ECB under Mario Draghi to provide funding to weak banks through the Long Term Financing Operation have reduced the effect the effects of contagion from a Greek default spreading to banks in other EU countries. The fiscal pact signed in Jan 2012 at the EU summit with automatic penalties for countries lacking budget discipline provides Angela Merkel more room with her domestic political base to support the EFSF's capacity to help other eurozone countries. Greece with its deteriorating economic situation would then be considered a special case.

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The IMF, ECB, and the EU, are requiring Greece to make cuts to private sector salaries by a reported 25% to bring Greece's wages more in line with a country like Portugal, because of the lower productivity of Greek workers and a way to make Greek goods more competitive. This is one way to accomplish what a devaluation of the drachma would have done when Greece was outside the eurozone. Greece's minimum wage is about $1000 a month- officials from the troika want to see this go down about $750 a month. The difficulty is that consumer prices are higher in Greece, with gasoline at $8 a gallon and other prices higher due to cartels that control the distribution of consumer goods in Greece. Other austerity measures required by the troika as a condition for further aid to Greece are pension cuts and higher taxes on businesses. Labor unions and business leaders pointed out other factors affecting Greece's competitiveness in a letter to prime minister Papademos as they opposed drastic wage cuts- the letter said " competitiveness is affected more by factors like bureaucracy- which is fed by complex regulation, state intervention, the tax system, corruption and antibusiness mentality rather than wage costs."...

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The Saudi government announced sharp cuts in spending and subsidies to cut the deficit in 2016. The deficit in 2015 was about $98 billion or 367 billion riyals , according to Al Arabiya Saudi news channel. In 2016 the budget is designed to cut the deficit to $87 billion or 326 billion riyals. The 2016 budget is for 840 billion riyals, compared to 975 billion riyals in 2015. Saudi Arabia's foreign exchange reserves of $640 billion could be exhausted at this rate by 2020, experts say. Actions being taken by the government include increasing the price of some grades of gasoline sold domestically by 50%, as subsidies are being cut. The drop in oil prices to about $35-$40 is hurting Russia, Saudis and Venezuela. The Saudis have increased defense spending for conflicts in Yemen, and in other areas, as they oppose Iran and Russia in the Iraq- Syria conflict.

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As OPEC members met again in June 2015 for the first time since the meeting in November 2014, there is a sense that OPEC no longer exerts the same influence on oil prices. There are 4000 oil companies in the U.S., says one U.S. State Department official, even if OPEC were to cut production the cuts could be matched by shale oil producers in the U.S. quickly increasing output. This is the new reality, say experts. OPEC expects to keep production at the same level of the current production ceiling of 30 million barrels a day in place for the 7th meeting in over 3 years. Algeria and Nigeria, both hurt badly by the drop in oil price, have called for cuts but failed to persuade the Saudis. With Russia unwilling to join a coordinated production cut, there is not much talk about doing this. The Saudis and Iraq have continued to pump more oil, with April 2015 production of 30.84 million barrels a day the highest monthly average since 2012. Other factors also remain in the minds of the Saudis and other producers such as the United Arab Emirates, Kuwait, Qatar- policies on climate change, use of less energy and more from friendlier sources for the same amount of economic output demonstrated by countries such as Germany, advances in technology, energy saving transitions in emerging markets such as China and India....

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A look at the history of the founding of Pakistan and the 60 years since, looking all the way back to Muslim League's activities in the 1930's under Jinnah, and the failure of politicians and the military to help build Pakistan and improve the lives of its people. One by one the generals and the politicians, including Ms Bhutto and Sharif, have all failed and the dim prospects that it would be different this time with a new elected government.

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The home ownership rate for the U.S. in March 2012, is 65.4%, the same rate as in 1997 before the housing bubble, according to the U.S. Census Bureau. The irony of this is that the housing bubble was inflated by politicians in Congress and mortgage lenders and purchasers of mortgage securities. Fannie Mae and Countryside worked together ostensibly to promote home ownership while pursuing profits. In the case of politicians they pursued goals of raising employment and growth without understanding the risks of artificially inflating home ownership, and without consideration for incomes of subprime borrowers. A less benign view of the interests and goals of politicians comes from reflections on the impact of political lobbying by Fannie Mae and other housing lenders in the U.S. Congress. The consequences in terms of foreclosures have been devastating for minorities as well as other middle class homeowners. It has also damaged the U.S. banking system, credit growth in the economy and prospects for recovery, which will take years to correct. The federal government is also saddled with large losses at Fannie Mae because of its quasi government agency role. That role led to inflation of the bubble. Most of the consequences will be borne by middle and lower income households in the U.S. The pass-through effects in a global economy affect Europe, and emerging market countries. ...

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Th cost of cancer drugs Avastin and Erbitux and the need for putting life savings at risk for a few months of treatment create tension among families, doctors and treatment providers. A course of Avastin could run $56,000 and take 90 days for reimbursement by meicare or pricate insurance, and a 20% co-pay comes to $11,200.

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Prime minister Abe of Japan and President Jinping of China meet for 25 minutes on the sidelines of the Asia Africa Summit in Indonesia, on April 21, 2015. In a sign of thawing in relations both sides take an active interest in improving relations. This is the 60th anniversary of the Bandung conference in Indonesia, and Japan restated its pledge during the 1955 meeting of Asian and African leaders to not use force in territorial disputes. Abe said he had "deep remorse" for Japan's role in World War II. Xi Jinping's speech covered China's effort to build the "Silk Road" infrastructure projects in Asia and Africa, and said the AIIB bank was seen positively by the international community. Jinping emphasized the joint responsibility of both countries for peaceful development and regional stability. Abe suggested that a communications system for emergencies be established between the two countries and a defense dialogue be setup.