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U.S. Federal Reserve governor Daniel Tarullo tells the Council on Foreign Relations that so much remains to be done four years after the financial crisis. The law firm of Davis Polk says 67 percent of deadlines were missed for new rules required to be set in place by the Dodd-Frank legislation, including the Volcker Rule. Tarullo said: "It is sobering to recognize that more than four years after the failure of Bear Stearns began the acute phase of the financial crisis, so much remains to be done." Tarullo fears that crucial momentum may be lost because of the long delays stemming from resistance by the banks. Tarullo met with bank CEO's in April 2012. Banks have protested that Fed stress tests have not revealed the parameters for the testing. Tarullo's response given at a recent Fed conference in Chicago were that this would let banks game the exercize by running the Federal Reserve model and not improving risk management and capital planning, making this a mechanical compliance exercize. Banks have particularly opposed a requirement that limits the risk in business between two banks to 10% of their credit risk....

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Infratest Dimap polling institute is commissioned by DW.com to find out what Germans think of the refugee policy of chancellor Merkel one year later. In summer 2015 Merkel said on Aug 31, "We can do it." Costs related to the refugees are about $17 billion, do Germans think services are overstretched for education, healthcare housing and other services. On the other side German society is aging and for every 100 unemployed people there are 200 open positions for skilled personnel. But the refugees who are accepted do not have the skills required and have to acquire the skills or given training and education. On this issue DW.com asked the question whether it will strengthen the German economy. About 51% agree and 45% disagree on this question, and about the same number agree and disagree on the question that Germany will be overstretched providing the services for housing, education, healthcare and other services. The higher educated and young are more favorable to accepting refugees, with those over 50 and basic schooling unfavorable. On the AfD side most people are unfavorable, and in the Greens party most are favorable. On terrorist incidents probability, over 58% think this is more likely, 38% disagree. On the question of whether this will make Germany more diverse 56% agree, 40% disagree. Overall the situation appears to be balanced, with a range of views expressed, and the positive and negative sentiment "evenly balanced", says DW.com.  ...

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Confessore describes ways in which the Republican Party agenda moved away from the interests of ordinary American working class voters in the last decade, ignoring some of the effects of the 2008 financial crisis and the deep recession in the years that followed.

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The effort by 90 German universities to provide education for free to the large number of refugees from North Africa and the Middle East that are being given a home in Germany in 2015-2016. In rural areas especially in former East Germany there is still uneasiness about the large number of refugees expected to come in 2015- but students and most people in urban areas are receptive. Yet the challenges remain as the university system is crowded with students and can accomodate only about a fourth of the refugges coming in 2015. The low unemployment rate and need for workers is helpful in absorbing such a large influx of people into the country. Volunteers and the German language classes will help better integrate the refugees into German society. Though there is a small minority of people opposed to immigration, Germany society remains largely open to taking in and helping the refugees, compared to the situation in Sweden and Denmark where recent elections showed parties with anti-immigration stance getting a larger share of the vote and becoming part of the government....

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Efforts to bring the textbook industry under state control by selling the firm "Enlightenment," which had a 30% share of the market, to Putin ally Rotenberg. "Enlightenment" has now received further support as other competitor's textbooks were not given approval by the Ministry of Education and Science. Apparently Putin sees western ideas introduced in some textbooks as harmful to the development of Russia's youth. All schools will now be given state inspections, and where textbooks are not on the approved list the schools will see cutoff of state funds. Putin was chairman of the publisher "Enlightenment" when it was under state control, Rotenberg is the new chairman. During Soviet times "Enlightenment" as a state publisher controlled all textbook publication. The industry was opened up after 1990, resulting in a large number of new publishers. Now many small publishers are being pushed out as the industry is being consolidated under the state's private sector allies with an educational agenda being set by Mr. Putin....

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The IMF's managing director, Christine Lagarde, pointed to the urgent need to recapitalize European banks in September 2011. European banks face potential losses of 120 billion euros for Belgium, Spain and Italy, 60 billion euros for Greece, 20 billion euros for Ireland and Portugal, and 100 billion euros for other banking exposure, for a total of 300 billion euros, according to the International Monetary Fund. In the absence of recapitalization there could be further damage to EU economies from restricted lending by banks. IMF estimates show that deteriorating credit conditions could damage growth in the eurozone countries by 3.5 percentage points, and in the U.S. by 2.2 percentage points, creating another recession.

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Only by learning the lessons of "normal" trade with China, and accepting a feeling of "buyers remorse," says Senator Sherrod Brown of Ohio, will a better bilateral trade relationship with China evolve. He points out that every $1 billion of the trade deficit with China, has destroyed 13,000 net jobs, making the $226 billon deficit a tale of shuttered factories and devastated communities. He says China uses illegal subsidies and currency manipulation, and punitive steps are needed, not the moral suasion that the Obama administration keeps doing with no result. He says price manipulation keeps Chinese products 40% cheaper than comparable American made products. He wants the Senate to give tariff authority to the President, to impose tariffs on countries that manipulate their currency, when it convenes next month. Brown is the author of the book- Myths of Free Trade.

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Miller says the whole thing about the super-committee, the polemics between Republicans and President Obama about deficits and billionaires, could end up being a charade with Obama hoping to squeeze by in the 2012 presidential elections and the Republicans equally intent on getting 51%. In the end Obama's poor handling of the debt ceiling, including an unwillingness to go ahead with raising the debt ceiling even if it went to court, says Miller, shows a basic failure of the Obama presidency. In the end he thinks its not that the centre-left is going to be mad at Obama, they will be mad at themselves for believing he was going to be any different.

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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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The Bank of Mexico, Mexico's central bank, cuts interest rates by half a percentage point to 3% in June 2014. The consumer price index is at 3.4% for 12 months through mid-May, and the central bank sees the inflation target of 3% by early 2015 as achievable. The central bank's estimate for GDP growth in 2014 was lowered to 2.8% from 3.5%. GDP growth was annualized 1.1% for the 1st quarter of 2014. Mexico has failed to live up to the growth expectations after the new Nieto administration's efforts to jumpstart the economy and opening up of the state oil industry to foreign investment. The policy changes of the Nieto administration set the future course of the economy and will take time to deliver results in economic growth. More effective administration and execution is needed for economic growth.

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Friedman compares the anti-corruption movements in India and the U.S., the world's two largest democracies. The Occupy Wall Street anti-corruption movement in the U.S. focusses on the excessive influence of banks on lawmakers, regulators, and the government, through the use of campaign money, revolving door for government officials and regulators to join banks, and intense lobbying. The anti-corruption movement focusses on corruption in government at higher levels, such as the handling of government licenses, and at the basic levels of needing to bribe officials for something as simple as getting a birth certificate or other government document. Both have pernicious effects, in the U.S. excesssive bank influence leads to taking excessive risk for higher bonuses, putting the entire financial system at risk and creating a crisis in housing that delays the economic recovery. And in India the corruption leads to retarded progress, as funds to invest in infrastructure and development are siphoned off, business and entrepreneurs are required to pay bribes at each step, and ordinary people face the need to pay bribes for the most routine interactions with government officials. In the process this creates more unequal societies by skewing the distribution of benefits from wealth created to groups that are better equipped to game the system. The economic system once distorted in these ways has tendencies to take talent away from productive activity and innovation which create wealth, and direct it towards speculative activities....

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Wagoner became President at age 45, CEO at age 48. So you would think that young blood is coming in to GM, but that does not appear to be the case. At the Board level most of the Board members like George Fisher formerly of Motorola, have been around for a long time, and there does not appear to be new blood that would bring in fresh thinking. And serious decisions about investment in developing new technologies to develop fuel efficient cars, like hybrid technologies, electric and other alternative technologies, diesel technology, have been held up for years at General Motors. The way decisions are made on such issues with Board members voicing their opinions more than wrestling seriously with the issues, shows serious shortcomings of management and the Board. At key points of decision making the CEO and key members of his team had not prepared carefully, and Board members did not come up with serious thinking on the problems facing GM. It, appears that the investment in technologies to develop fuel efficient cars much earlier, long before they were finally being addressed in 2006, was a failure of Wagoner's management and of the Board. Management discussed this but continued to be mired in old ways of thinking that continuing with the status quo- cars with existing low fuel efficiency- would not expose GM to illwinds as preferences changed. Its clear from the description here of discussions within GM that the old thinking is quite entrenched at GM, and Wagoner just was not the kind of person who could vigorously articulate a new vision for GM. A couple of things are noteworthy in this account of management indecision at GM. When fuel prices began hurting sales of SUV's and large vehicles in 2005, efforts to get a decision on investments in new technologies for fuel efficiency for the whole product lineup failed at the Board level in an April 2005 meeting. One Board member saying at that meeting, that" do we want to lose another billion dollars in developing new technology for fuel efficient cars." And no one calling him to account that the remark still did not address the point that GM had to respond to the changing market and world oil dynamics, and not just hope for the best, as GM had aggressive competitors, and faced continually diminishing role in the market place for the entire decade of the 1990's. While April 2005 was already at the tail end of the previous era of gas guzzling cars and a decision then would still not have shown a forward looking vision of things, it was not until 10 months later that a decision was reached. And this almost from necessity, as oil prices jumped in 2006 after hurricane Katrina, and by this time President Bush was also calling for higher mandated fuel efficiency standards. The other noteworthy point here is that by making the changes so late in the game, GM had to compress the development cycle for new and some cases unknown technologies into short time frames. If the ingenuity of its engineers comes to its rescue it still faces another hurdle that of cost, because the technologies have to be perfected and improved, so that the costs are low enough for customers, and importantly comparable with what it is costing competitors to make the same fuel efficient technology engine or other part. Which is why one Honda executive remarked, "GM like everyone else is serious about this, because they have to be, but how many of their hybrids and how many Volts will they sell? Their technology is very expensive." Even if GM develops the Volt electric car by 2010, GM will need a whole range of fuel efficient technolgies to power its large product lineup. Its just to hard to avoid the conclusion that this is going to prove costly. All the dragging of feet and indecision, and failure to prepare GM for a different world in case something drastically different from what was expected happened, will prove very costly especially considering how aggressive and well financed some of the Japanese and German competitors are. It also hard to avoid the conclusion that there is too much bureaucracy at the large auto companies, and getting new blood and new ideas and fresh thinking is tough in a place where everybody agrees with everybody else, and there is uniformity of thinking. This makes it difficult for any original or wayward types to thrive. These bureaucracies look up to the top for direction. Initiative is discouraged on one hand, and at the same time even if a new direction is taken at the top. a lot of resistance can be expected to implementing it throughout the company without persistent persuasion and reminder of new facts and realities. This is true for both Wagoner and Mullaly as they face the skepticism of subordinates to new direction. Mullaly for instance has to remind his managers that large vehicles are only a small percentage of the entire global market, and if Toyota is making money in small cars so can Ford. See the link to this. Is Toyota immune from bureaucracy type behaviour throughout the company? Not really, Toyota's chairman emeritus came out of retirement in fact and went out of the way to caution its CEO and management about their complacency a year or so before. Shoichiro Toyoda personally intervened to caution against too much expansion in the US and climbing wage costs, and other risks they perceived such as the company managers in the USA appearing to be resting on their laurels. See the link to this. A lot of discussion is probably going on within these companies about the present state of affairs, and considerable anxiety for what the future will bring. It may be useful to ask the question is there something that makes it difficult for once successful organizations -now with entrenched bureaucracy and set ways -to put forward leaders with vision and foresight, till it becomes very late? The vision and foresight about where their markets and the world is heading, and the ability to move their organizations in that direction. Or to break out of old patterns of behaviour and thinking....

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Wessel summarizes the existing thinking of the administration and its critics on ways to prevent the next banking crisis. The Shultz-Mervyn King School which says breakup the largest banks into smaller banks so they are not too big to fail. The Volcker school which says separate utility banking from thre risk taking banking of the trading desks of investment banks. And the Geithner-Frank school of avoiding these tough choices in the face of intense lobbying by the banks by glossing over the problem, their latest proposal suggesting that Treasury collect the bill of abank bailout from the remaining weakened banks in afinancial crisis of the future. But the Geithner -Frank solution still has Treasury, meaning the government footing the bill, as collecting the bailout from remaining banks that are weak in such a financial crisis may not be feasible. and it would further worsen the government's finances, raising questions about these proposals which may amount to doing a little better than nothing. In effect avoiding the tough choices of breaking up the larger banks or separating utility banking from trading desks of investment banks....

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David Brooks of the NYT describes the approach taken by British prime minister David Cameron and his Conservative Party government to help the working class poor in Britain, and tackle the social roots of poverty. He says an American adaptation similar to this is badly needed in the Republican Party, with the candidates in the election providing solutions from an old rulebook. Only after Trump's popularity with appeals to less educated older Americans has the Republican leadership responded, with Speaker Ryan helping organize a forum on poverty under the Jack Kemp Foundation- emphasis was placed on education, work, opportunity and accountability for anti-poverty programs in the discussion moderated by Ryan and Senator Tim Scott. Less attention was paid to the other social aspects mentioned here by Brooks, and cited by Cameron when he described the inadequacy of traditional solutions from the right and left of the political spectrum. Cameron outlined the principles of his anti-poverty plans called "Life Chances Strategy," in a speech on Jan. 11, 2016, in north London, with the entrie transcript on the gov.uk website. Cameron acknowledged in the speech that social issues including single parent families, and other social problems such as long term unemployment, can make it harder for some people to use self-reliance and personal responsibility in a growing economy as a way to grasp opportunities. Cameron proposes a combination of economic, social and job growth strategies. His second term plans include 30 hours a week of free childcare for 3 and 4 year olds so both parents can work, parental maternity leave, expansion of Troubled Families Program, in addition to the introduction of National Living Wage, tax cuts, universal credit. In tackling social aspects of the problem Cameron cited the need for development in the early years of childhood, the huge importance of family, social connections and experiences, informal mentors, cultural experiences, broadenend horizons, that enable young people to acquire language skills, character and resilience. Second term projects include expanding reach of high performing schools to deprived areas, emphasis on core English, math, science, history, geography Ebacc skills, a 1 billion pound investment in the National Citizens Service by 2021, a plan to transform housing estates including rebuilding from scratch, additional 1 billion pounds to provide mental health treatment including treatment within 2 weeks in homes and communities. Throughout Cameron's "Life Chances strategy" is aimed at tackling not just the material dimensions of poverty, but also what he describes is broken in Britain- "the paucity of opportunity."...

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This Journal editorial says the Bankia bailout continues to be handled poorly by the Spanish government, with Bankia continuing to be a drain on the government funds.

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The Russian economy has proved stronger than other emerging markets in a similar situation. The ruble has declined from 35 to the dollar before the Ukraine crisis and sanctions in 2014 to 86 to the dollar in Jan. 2016. Foreign currency reserves dropped from $600 billion to $385 billion in 2009, when Russia with memories of 1997 when the ruble collapsed, decided to prop up the ruble. In Nov. 2014 Russia's central bank let the ruble float, this time responding in a different way following western sanctions over Ukraine and a emerging markets crisis. Interest rates were increased to tackle inflation.A key rate was raised to 17% in Dec. 2014, dropping by Jan 2016 to 11%. Inflation was 12.9% in Dec. 2015, the target for 2017 is 4%. The economy has contracted by 3.7% in 2015, and expected to contract by 1% in 2016, according to the IMF. Alexsei Kudrin, former finance minister, expects modest growth in 2017.

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Controversy about whether bringing back a revamped Ford Explorer is a good idea. Ford's Farley thinks Americans might still consider an Explorer with high fuel economy, getting it up to 28 mpg from 15 mpg. But the evidence is that Americans have soured on SUV's. Consider that during the cash-for-clunkers program more Explorers were scrapped, and by a large margin, than any other model. Sales are down from 450,000 at one time to 52,000 today. To get buyers to look at the Explorer Ford is trying to change the looks from boxy to sleeker car-based crossover , and add high tech features. In fact it is going to be built not as an SUV, but on the same architectural base as the Taurus.

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In its May 2011 special report on international banking the Economist points out the need for banking regulators to take stronger action than they have so far. What it calls "pre-emptive insurance" it says is needed - stronger regulation, larger capital cushions, and some form of separation of different kinds of banking. Without this the dangers of excessive risk taking and banks that are "too big to fail" will continue to threaten the world's economy. Banks that are smaller and better capitalized says the Economist can fail more gracefully than the large mega banks that exist at this time. In fact the banks today in the U.S. are larger than at the time of the 2008 crisis. Other analysts also point to the lack of major changes in banking and financial structures today compared to the situation before the 2008 crisis, both in Europe and the U.S.

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Italy's major problem is lack of growth, with growth averaging 0.3% in 2001-2010 compared to 1.1% for the eurozone area. In the 1st quarter of 2011 growth was only 0.1%. Italian bonds yield two percentage points above the yield on German bunds. With growth at the present level, Italy's would see an increase in debt to GDP ratios, according to Barclays Capital. Debt to GDP is currently at 119%.

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Egyptian leader ElBaradei describes his talk with U.S. Secretary of State Kerry and E.U. leader Ashton on the day of the coup on July 3, 2013 to convince them about the need for the military to intervene to oust president Morsi. He says two and ahalf years have been wasted but this time Egyptians have to get it right. Morsi was elected with the help of liberals, but failed in ElBaradei's view to form an inclusive government and respect all sides of opinion, including the young people who formed the core of protests against years of military rule.

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Chancellor Merkel of Germany proposed bilateral or trilateral deals between smaller groups of countries as a temporary solution till some agreement can be reached on immigration. She said "The European Council will not yet provide an overall solution to the migration problem." Hungary, Poland, Slovakia, Czech Republic which have opposed a quota system for asylum seekers did not attend.  Austria, Denmark, and Italy with the new government openly opposing immigration, attended the summit. Merkel said  a "lot of goodwill" was created, and leaders agreed that borders need to be better protected to prevent people from entering illegally, and reducing immigration at its source points in Africa. The migration problem has persisted as an issue long after the huge surge in immigration in 2015 has diminished to a trickle, and after chancellor Merkel has accomodated critics with new policies strictly limiting new immigration. New governments in Denmark, Austria and Italy, and the government in Hungary under Viktor Orban, have kept the issue alive by running on anti-immigration platforms. The European summit in 2018 was used by Merkel to reduce disagreement on this issue by allowing different countries to express their views and working in smaller groups for mutual benefit. It also reduces tension inside her CDP-CSU coalition after Bavaria based CSU decided to run in 2018 state elections on a platform calling for securing borders. ...