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Prime minister Matteo Renzi focussed on some critical aspects of how other Europeans see the negotiations in the Greece bailout in June 2015. Considering that the EU had relaxed conditions for the surplus, a critical condition for reducing austerity programs in Greece and focussing on reforms, and considering the high unemployment not insisted on further cuts to the public sector employees, the conditions put forward focussing on reforms such as collection of taxes are seen as essental by other eurozone countries, including Spain, Portugal, Ireland and Italy. Renzi told II Sole 24 Ore- "The point is that Greece may get different conditions, but it has to abide by the rules. It's not the case that we have taken early retiremnt pensions away from the people of Italy just to allow the Greeks to have them! We have brought in labor reform, but it is not the case that, with our money, a number of Greek shipowners can continue not to pay taxes.. I could go on." If he went on he would cite the tax collection laws and methods in Italy which were changed under prime minister Monti to tackle tax evasion in Italy, with no effort to collect the $11 billion in estimated taxes that are not collected in Greece. Italy banned cash payment above 1000 euros and started a cross referencing initiative to tackle tax evasion under premier Monti. Greece took up tax evasion legislation in 2010 in parliament but opposition from many groups led to no action. In 2012 Labor minister Elsa Fornero broke down in tears as she described raising the retirement age for women to 66 in the private sector from 60, saying this was to prevent "collective impoverishment." Italy lacks childcare and older women help with childcare for grandchildren. Renzi was probably thinking of these changes in Italy. He went on to say- " If there is a mass get-out clause over the rules, what will happen in Spain in October? And in France in a year and half? It is one thing to ask for flexibility amid abidance by the rules. It is another thing to think that one is the craftiest of them all, in other words to be the that does not abide by the rules. We want them to save Greece. But the people of Greece also have to want that." On tax evasion and other issues for long term financial health Greece is seen as not following basic financial rules for sustaining the euro....

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Positions different industries are taking on the energy consumption question.

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A shift in priorities away from focussing on high growth to lower sustainable growth was announced by China's premier Wen Jiabao at the National People's Congress, China's parliament, in March 2012. This shift will reduce investment in infrastructure, power generation and exports, which will affect the level of imports of commodities from commodity producing nations in the Middle East, Australia, Canada and Brazil. It should increase imports of software, computers, entertainment, tourism and high tech goods from the U.S. and Europe. Chinese leaders have said they would make this kind of shift for some years now but growth has consistently increased more than the target rate, and domestic consumption as a percentage of the economy has actually decreased in the last decade. Now 9-10% growth rates may be a thing of the past and the target of 7.5% set this year may be actually closer to the real figure. The Chinese leaders have belatedly realized the need to make these changes now because slowing markets in Europe -which is seeing declining growth and high unemployment- and in the U.S., make the issue impossible to avoid. Wen told the Congress: "Accelerating the transformation of the pattern of economc development... is both a long term task and our most pressing task at present... Domestically it has become more urgent but also more difficult... to alleviate the problem of unbalanced, uncoordinated and unsustainable development." This is his way of saying that its unavoidable and better to start in earnest now, and at the same time recognizing the resistance to change from the stateowned companies and the other interests who have benefitted from surging growth, and now occupy a central role in the power structure. An opinion article in the People's Daily, China's official newspaper, said: "imperfect reforms are to be preferred to a crisis caused by no reforms." The World Bank's president Zoellick is respected by the Chinese leaders. He also urged them to make changes now. The recent report of the DRC, China's planning research arm, and the World Bank, also laid out the new direction away from a focus on infrastructure to domestic consumption. The fear is sudden deceleration in the absence of policy action. The impact of this will be negative for commodities over time, leading to slower growth in Australia, Brazil, and Canada. It should boost imports from Europe and the U.S. of high tech, consumer, pharmaceutical goods over time....

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A seven member panel formed by Toyota to look into Toyota's recall problems made its recommendations recently. The panel's report says Toyota was not good at responding to criticism from outside. Company executives looked at complaints about sudden acceleration defensively or skeptically, and viewed regulators in an "adversarial" manner. The NHTSA also has come under criticism in investigations, because to some extent Toyota's close connections with the NHTSA made it possible for the company to drags its feet in responding to complaints. Edmunds.com CEO, Jeremy Anwyl, says Toyota has a stable and predictable way of doing things and this does not work well in a crisis, leaving Toyota uniquely vulnerable to this. The insularity of executives in Japan because of the lack of non-Japanese on the Board. and in other important positions, magnifies the problems when they are rooted in a crosscultural environment. Such complaints in the U.S. media are viewed differently than in Japan. The report also pointed out that safety and quality are two different things - that processes that improve quality will not necessarily produce safe vehicles. By putting safety under quality and making everyone responsible for quality, no specific executives were assigned responsibility for safety. One of the lessons learned from the recall crisis is that specific responsibility needs to be assigned for safety, and the person in charge has to report directly to the President and top managers. One of the panel members, Brian O'Neil, a former president of the Insurance Institute for Highway Saferty, says the old adage is true in this case- when everyone is responsible, no one is responsible....

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The Obama first family and its many mulicultural faces from Kenyan, Indonesian, Chinese to African American and White abolitionists from Missouri. Truly a new face of the American continent. About 25% of white Americans have interracial marraiges and nearly half of all black Americans belong to a multiracial family, according to estimates made by Joshua Goldstein of the Max Planck Institute for Demographic Research. What it does is wake one up to the reality, the changes that have already ocurred in the country which most people had not realized. With Blacks, Hispanics, Jewish people, Asian Americans, the 25% of whites in interracial marraiges, recent immigrants, white women, and white males making up this mosaic of cultures and communities that makeup America. And the geographical mix is also just as varied, with the west and the northwest and the midwest and east having a bigger share of this mosaic than the south and the mountain states. Whites in interracial marraiges tends to breakup the traditional white protestant insular demographic. On the religious side there is a breakup of the traditional white demographic with Irish Americans especially those in the east tending to move away from the traditional white protestant insular demographic because of their own particular historical and cultural narrative. The Obama story is one of tapping into these different demographics and changing faces of America at the right time, when the conservative southern demographic, represented by the Bush family, combined with related demographic groups in counties and neighborhoods around the country had lost popular support from two wars and a failing economy....

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One military expert says even if half of the Iraqi army can be put in shape it could turn the tide against the ISIS. Advice from U.S. military experts is for the Iraqi army to focus only on the ISIS and avoid hurting relations with the Sunni population. Advisers are seen as making a difference and needed also for the tribal forces. A major difficulty is that Shiite militias and advisors from Iran play a role in the forces loyal to prime minister Maliki. Following the U.S. training of the Iraqi Army at a cost of over $25 billion there was a period under prime minister Maliki when he appointed officers more for loyalty than for military skills and training. With the U.S. withdrawal the Iraqi Army languished in this situation. Reporters from NYT and WSJ have documented extensively the weakness of the Iraqi Army in commanding officers, in training and in equipment.

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Matt Vela responded to Shailen's comments on this article on the BW site. Comments were on NYTimes columnist Tom Friedman's remarks, about the dangers of overdependence on Mideast oil vs. GM and Ford's efforts to simply move cars off the lot. A quick reading of reader comments about 5-6 (all comments) shows a huge perception and marketing gap for Ford and GM if this is even anywhere near a representative sample, because they were heavily negative. Friedman said in the NYT, that "GM is more dangerous to America's future" than any other company, that "its like a crack dealer" addicting Americans to SUVs in the face of higher gas prices- by offering buyers of its least fuel efficient SUV's gas capped at $1.99 per gallon. He also said GM is in cabal with Ford and DaimlerChrysler to buy votes in Congress. BY May 2006 compared to 2003, in just 3 years, once popular midsize SUV's like the Ford Explorer, Chevy Trailblazer, and Dodge Durango saw a sales plunge of 50%. And this after the gas promotions such as the Ford one for free gas upto $1000 with aprepaid Master Charge debit card, enough for 6000 miles. Add to this zero percent financing. GM offered rebates of $2500 to $3500 per SUV. In this manner the whole profit structure of SUV's is being lowered, and no new strategy is being developed to deal with changing conditions and changing consumer preferences, and a changing global situation....

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Hedge funds betting against China's currency in Jan. 2016 puts Wall Street at odds with China's central bank's effort to manage the decline in the currency. Some hedge funds see a large drop in the value of the yuan in 2016-2017. China also faces the risk of large capital outflows. This is happening against the backdrop of China's effort to cut overcapacity in steel and other industries, manage large debt and the slowing economy, to shift towards a less export dependent and more domestic consumption oriented economy. Hedge funds are taking short positions against the yuan, as they expect China will need to recapitalize its banks considering the rapid acceleration in debt, leading to further depreciation in the currency.

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The situation in Tampico, Mexico, with corruption, crime and dangers to public safety, show the problems Mexico is still grappling with to ensure a rule-of-law state right next to the U.S. The paradox is that of a breakdown in public safety with Calderon's war against drug gangs undermined by corrupt police and local government, and the continued foreign investment in the country. DuPont is investing $500 million in a new plant near the port of Tampico and South Korea's steel manufacturer POSCO is planning a $300 million investment to double production in this area.

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Verizon's support for another ecosystem in Nokia powered by Microsoft software. This would increase its leverage with Apple and reduce the large payments for carrying iPhones.

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U.S. president Trump's statement calling for a list of goods for tariffs on $200 billion of Chinese goods leaves China without a clear response and facing new risks. The U.S. exports about $150 billion in goods to China so that China would have to impose penalties to respond at the same level. Placing restrictions on American firms on access to China's market, and imposing other penalties would have the effect of reinforcing the perception of unfair practices targeting American business and lead to hardening of U.S. response.  The U.S. sees itself as being in a better position with the U.S. economy experiencing a growth trend. China with large local government and bank debt faces a difficult situation. President Jinping's policy of reducing the risks of bad debt in the banking system involved sacrificing some growth to stabilize the system. China's GDP growth in 2017 was 6.9%, the target at 6.5%. Future targets and actual growth now look to be much lower.The trade war with the U.S. has the effect of dampening growth leading to calls for the central bank to loosen its monetary stance. In response to Trump's announcement the People's Bank of China pumped $31 billion into the nation's banks. China is studying Japan's response in the 1980's and 1990's when the U.S. took strong action against Japan's growing trade surplus. Japan responded by appreciating its currency and using stimulus to cushion the effect of lower exports on the economy. The stimulus led to the housing bubble and over time a period of low growth and stagnant economy. The large China stimulus in 2008-2009 has compounded the problems in the banking system. Not deleveraging and controlling financial risks in China's banking system because of the trade war would bring a new set of risks. ...

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Interview with Dieter Zetsche, Daimler's CEO on what Mercedes is doing. Daimler is introducing the Smart car in the US in a big way. Its just 8 feet long and gets 40 miles per gallon. Demand for it from dealers was so strong that instead of 40 dealers as planned Mercedes has setup 67 dealers in 31 states in the USA. About 3500 were sold in the first 3 months, Feb to April 2008. Its Bluetec program is another way its boosting fuel efficiency. The Bluetec program is for making diesel engines as clean as gasoline engines and gasoline engines as efficient as diesel engines. Its the second generation of direct injection systems and both engines will work with self ignition. And Daimler is on the path of combining these engines with hybrids. And also develping fuel cell and all electric battery driven vehicles emission free. As Zetsche says Daimler is moving along this path very fast. In lithium ion battery in cars Daimler is taking the lead. He says the American and Japanese makers are pushing hard but Mercedes is ahead by taking the car to market that has a lithium ion battery. How does Daimler do it? It has about 24 patents. The main reason no carmaker has made it to market with lithium ion battery for cars is the cooling problem that has been seen in laptops also. Mercedes solution to this has been to integrate the cooling of the battery into the cooling system of the car with a sophisticated system, hence the many patents. Next year Dailmer will introduce the S-Class with a six cylinder gasoline engine, the S400 Hybrid with a lithium ion battery, and it will be the first in market. Dieter Zetsche is so confident that he says it will have perfect performance and absolute safety. With targets for fuel efficiency in Europe more aggressive than in the USA, and the German public pushing for higher fuel efficiency aggressive emissions targets and intolerant of excuses from German carmakers, makers like Daimler are moving very fast in this direction. Adding to pressures from the German public, they see oil prices at current levels for the foreseeable future, this adds to the urgency. Americans and Japanese makers stand the risk of falling behind. See the links to the pressure from German public opinion and the German carmakers response to this. And clearly Zetsche reflects that confidence in this interview. Daimler's Mercedes division is selling a lot of cars in China, Russia, and the Middle East. As he put it there are 400,000 millionaires in China and Mercedes are sellig very well in these markets just as the US market shrinks. And these are cars in the dollar 40,000 plus or $100,000 plus range in which Mercedes has he lead. This market will also shrink as the global economy slowsdown but the profits from this market will probably be plowed into the Bluetec and other advanced fuel efficiency programs that will give Daimler a market advantage in the longer run....

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The Japan Automobile Dealer's Association says Toyota's Prius hybrid was No. 1 in sales in Japan in 2009 with 209,000 sales, three times the sales in 2008. This shows the high popularity of green cars in Japan and a sign of future trends. Hybrid sales made up 10% of new vehicle sales in Japan in 2009. By comparison hybrid sales in the U.S. were 2.8%. Second in car sales in Japan was the Honda Fit, third the Toyota Vitz, both small fuel efficient cars. About 1.6 million Prius cars were sold worldwide from 1997 to 2009, according to Toyota. Toyota has kept the price of the Prius affordable by pricing it at around $22,000.

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This article by General James Jones is the second from the highest ranks of the Obama administration, saying the entire Middle East policy of U.S. president Obama was flawed and could lead to dangerous consequences. Gen. Jones, former National Security Advisor to Obama 2009-2010, says the situation today is worse than in 1991 when the U.S. launched Operation Provide Comfort to protect Kurdish refugees in Northern Iraq from Saddam Hussein, with an engagement of about 5 years and 25,000 Allied troops. Jones says the crisis in Iraq and Syria is of an order several times worse than 1991 and at any time since the 2003 invasion, as it involves the setup of a terrorist ISIS state in the heart of the Middle East. What went wrong? Jones says all the warnings from other Middle East nations about Maliki's corrupt policy and sectarianism used to stay in power turned to be true. Even Maliki's own advisors and colleagues say in a separate report by Matt Bradley that Maliki battled not for the Iraqi state but only to preserve his own power. Jones calls the U.S. president's decision not to act in Syria when the "red line" of use of chemical weapons was crossed, the failure to maintain a limited military training presence in Iraq after 2011, and not insisting that Mr. Maliki arm the Kurds, as having gravely aggravated the problem in 2014. Jones calls for arming the Kurds directly with sufficient weaponry for defending their region and providing immediate expanded aid to the Abadi government, appointment of a special envoy to ensure direct and immediate communications with Baghdad and with Kurdish, Sunni and Shiite leaders. He calls also for close air support of Iraqi and Kurdish operations, and an aggressive diplomatic effort to unify the Middle Eastern nations to remove ISIS from the region. Jones says this is the right thing to do in the name of all the Iraqi people yearning for peace, for the U.S. service personnel who made sacrifices in Iraq for 23 years, and for U.S. national security....

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Enrique Pena Nieto of the PRI party wins the presidential election in Mexico with 38% of the vote. Lopez Manuel Obrador came second with 31% of the vote, and the candidate of the ruling PAN party, Ms. Vazquez Mota came in third with 26% of the vote. Voters were eager for change afer 12 years of rule by the PAN party under Vicente Fox and Felipe Calderon. Mexico averaged growth of 2% during these years, though growth has increased since the financial crisis. But the benefits of globalization, foreign investment, and trade reached the better educated and skilled workers leaving many behind. This period included negative growth during the 2008 financial crisis. .

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Krugman points out that the U.S. Federal Reserve's forecasts in March 2012 show the U.S. will experience low inflation and high unemployment for many years. These forecasts are in sharp contrast to the expectations in the equity markets based on an uptick for a couple of months of unemployment numbers. The Fed's own statements suggest the improvement in hiring may be temporary and a response to the overreaction in hiring in 2009-2010 to the financial crisis, and not a lasting improvement. The Fed pointed out that the long term unemployed are at about 40% of the total unemployed and the share of the population that is working in March 2012 has barely budged from 58% in 2009.