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The median household headed by a person 60-62 years of age with a 401(k) account has less than one fourth of what is needed to maintain a standard of living at retirement, according to data from the Federal Reserve and analyzed by the Center for Retirement Research at Boston College for the Wall Street Journal. Including Social Security and any pensions or other savings, the savings are way short of what is needed for retirement. Households used in this data had a median income of $87,700 in 2009. The 85% needed for a decent standard of living upon retirement is $74,545. Social Security would provide an estimated 40% of pre-retiremment income, or $35,080 for that median family, leaving $39,465 that has to come from other sources. The median 401(k) account has $149,400 which would only provide a fixed income each year of $9,073- only one fourth of the $39,465 needed. To generate that $39,465, households have to have $636,673, and only 8% of American households approaching retirement have that amount. Half of the families have other pension income of $26,500 a year, which added to $9,073 in 401(k) income gets the total income up to $35,573. Other studies using different data by the Employee Benefit Research Institute show results that are largely similiar. The Employee Benefit Research Institute, is supported by 401(k) providers. Its estimate of the median person is based on individuals in the 60's who have worked at the same company for more than 30 years. This data shows an estimated median person having about $158,754, not much different from the Fed data. Why is the amount in most Americans 401(k) savings so low? There was a mistaken sense that a 6% annual contribution, with a 3% company match would be enough. Vanguard Group says the current median amount that people contribute is 9%, counting the employer contribution. Now Vanguard is advising people to contribute more, 12 to 15%, including the employer contribution. Other problems for the low savings is that saving started late, or contributions were suspended after a job loss, or medical emergencies, other debt. The stock market collapses of 2000-2002 and 2007-2009, added to the problems, by wiping out a portion of the savings. The low rate of interest on savings for most of the last decade hurt even conservative investors and lowers the kind of retirement account income used by seniors. The way people are coping with this is to work longer, in some cases into the 70's, cutting down on spending for food, travel, and taking greater risks for higher returns, risks that could make the situation worse....

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Japan's energy efficient industry is a role model for the western world and for India and China. For years Japan has had a national consensus on consuming less energy an industry has focused on developing energy efficent technologies and investing in it even when oil prices were low. Japan wants to now contribute to the world in this area at the G8 summit on the island of Hokkaido. According to the International Energy Agency in Paris, Japan consumes half as much energy per dollar worth of economic activity as the European Union or the United States, and one-eighth as much as India or China in 2005. According to the Japanese Economic Ministry data corporate Japan has kept its energy consumption annually at a billion barrels of oil since the early 1970's even as the country's economy doubled in size during the 1970's and 1980's. The Japanese steel industry invested $45 billion dollars between 1972 to 2006 in developing energy saving technologies, according to the Japan Iron and Steel Federation. By capturing heat and gases that go into waste JFE Steel at its Keihin mill on Tokyo Bay uses it to power generators that produce 90% of the plant's electricity. The Japanese government is now pushing an initiative that sets Japan's level of energy conservation as targets of global industries. For instance the group leader of JFE's climate change policy group says that by adopting Japanese conservation technologies the global steel industry could reduce carbon emissions by 300 million tons a year. The sector approach advocated by Japan means setting the same numerical goals for all companies in an industry, regardless of location. At next week's summit meeting Japan willl back an initiative that sets its conservation induced energy levels as the new standards for global industries. This will also promote the sale and use of Japanese energy saving technologies around the world....

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Chrysler looks the weakest of the big three US automakers. Now that Daimler is out of the picture Chrysler depends on Cerberus for support and financing. And not much of this is there because Cerberus is having problems of its own. The GMAC investment of $12 billion for Cerberus has soured because of subprime loan losses in GMAC. All this is going on while Chrysler looks more like a company in disarray and Daimler does'nt appear to have left it in any good condition, considering that Cerberus finished its acquiistion of Chrysler only 4 months ago, and only now are executives like Mr Nardelli and Jim Press getting familiar with the company, its people and its products. Chrysler will have to come up with new fuel saving technologies but how is it going to fund this is losses in 2008 don't look much better than 2007 as is now expected. With a 15.5 million car year as estimated by industry experts Chrysler looks to lose more sales. Nardelli was shocked to learn that Chrysler was running its plants based on a forecast of 17 million sales in 2008 which goes to show that things are in disarray at Chrsler. The models which lost money on each car sold Pacifica, Magnum and Crossfire should have been discontinued by Daimler a long time ago, but this decision was reached only recently. And a program that was supposed to save $250 million was actually saving only $1 million in parts executives at Chrysler found. Its a difficult environment for engineers to work in especially when on one hand the direction is to improve quality and on the other hand to reduce cost, all in an environment in which no major new investment funding is seen fromCerberus or other sources and the sales outlook doesn't look good at all with competition well financed or better financed and with greater resources....

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Statistics bureau CBS says unemployment in the Netherlands increased to 6.8% in June 2013. Household spending declined by 1.8% on an annual basis in May, following two years of declines. Fall in house prices since 2008 have led to smaller spending and decline in sales of cars, appliances and household products. As the household sector cuts back, the banks and government are also working to reduce debt and improve finances. The cutbacks are happening at the same time leading to the paradox of thrift, says a professor at Erasmus University in Rotterdam, where all sectors are saving leading to a reduction or collapse of aggregate demand. The government of prime minister Mark Rutte is adhering to financial discipline to meet EU requirement in 2014 and implementation of 6 billion euros in spending cuts by Sept. 2013.

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Italy's governing coalition of the Five Star Movement and the Northern League retreats from its plans to raise welfare and pension spending after spending plans leads to loss of investor confidence. Disputes on fiscal discipline with the European Union hurts Italy as ten year bond yields rise from 1.7% to 3.7% after the coalition took office. Italy's GDP declined by 0.5% in the third quarter of 2018 with lower business investment and consumer spending, creating risks of falling into recession. The result is that the coalition government led by Matteo Salvini and De Maio is looking for ways to meet the EU fiscal discipline rules after statements that it would follow its spending plans. Italy's national debt of 2.3 trillion euros is equal to 131% of GDP and perceived as riskier than most other euro countries. Promises made by the coalition government include: allowing retirement at age 62 instead of 67, and intoroducing "citizenship income" or basic welfare of around 780 euros a month for poor and unemployed. These plans are in the budget. Political leaders want to avoid losing face with voters by removing this from the budget. The alternative of the EU opening fiscal disciplinary proceedings against Italy would lead to further loss of investor confidence worsening the economic situation, is also a step Italy wishes to avoid. The EU Commission's view is that the budget plan would increase the structural deficit by $22 billion or 1.2% of GDP. ...

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Prime minister Modi's address in Hindi to the nation on May 12 on "Atman Nirbhar Bharat" (self reliant India) as India looks ahead to a situation beyond the coronavirus. What would the economy look like as India moves forward? He says the emphasis will be on planning for the need for land, labor, liquidity, and laws to develop the Indian economy. A bold package of economic action for an investment of 20 lakh crore rupees or $280 billion was announced with details to be provided later. The basic philosophy of the next move forward was what the prime minister concentrated his speech on. Modi says there are 5 pillars for the Atman Nirbhar Bharat, or Self Reliant India. The first action not to go for incremental change- go instead for a quantum leap, be bold. This applies to both technology and investment and creating an environment where results can be achieved. Second action to make the kind of infrastructure that would set a new standard in the world. Third a "sabhi ke sapno ke aadhar," taking everyone along, be technology driven. Third action celebrate and build on India's vibrant demography, once seen as a weakness this will be turned into a strength. Fifth action be Demand driven - "demand or supply chain puri samtha ke saman karne ki jaruat che." The demand and supply chain  should be taken good care of. That also means be local and local manufacturing. Be vocal for local is the new message said Modi, because this is what worked and is saving us in the pandemic. As external supply chains failed countries in Europe and North America, it is the local supply chain for medicine, health care equipment, and food supplies, local technology for citizen id and bank accounts for direct deposit, agricultural supplies, strong and large national postal and rail networks and millions of employees spanning the country in all directions, that have proved of amazing value in this crisis. "Is local ne bhi bachaya, ham sabki jinnadari hai," - the local saved us and is everyone's responsibility.   ...

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 Americans in the southern states forget that president Kennedy made the famous statement about "a rising tide lifts all boats" in Arkansas, a poor southern state, saying that America must invest in all regions in people in all parts not just in well off northeastern states. In a handful of southern states expanding Medicaid to about $43,000 or 138% of the federal poverty level for a family of four is now being taken up by Republican leaders who show new openness- in Alabama, Georgia and Mississippi. Noah Weiland -of NYT looks at one particular battle -between Democrat Governor Laura Kelly in Kansas and Republican Speaker Hawkins- in Topeka, Kansas, where the fight goes on. Hawkins calling it the greatest Ponzi scheme devised and Kelly telling this reporter that she has included a work requirement so there is no excuse for not doing this. Republicans are coming around and so are states in other places. Missouri, Nebraska, and Oklahoma, states that lie next to Kansas have approved this through ballot initiatives. The point here is that in the years as America comes out of the pandemic there is and should rightly be a realization that this is different, that the children of low income families deserve as equal a chance as their higher income fellow Americans, that depriving them of good medical care makes America a weaker country. As Jerome Powell of the US Fed said in Stanford today about Kennedy's expression of "lifting all boats," it is just this that is needed today. It will be the No.1 election issue in Kansas in 2024, says Governor Kelly. The Republicans are also having second thoughts and are now just face saving. Consider that the Kansas Health Institute a research group, says 70% of the people becoming eligible for Medicaid expansion are working. Many are restaurant business workers who cannot provide proper medical care to children who form the next generation of America. And hiring in rural hospitals would expand for health workers instead of layoffs in southern states lifting financial strain on rural healthcare with additional Medicaid funds. This helps rural America when it needs it most. ...

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Do you ever wonder how Japan keeps it streets so clean. There are no litter bins or street sweepers to be seen. This report in the BBC News looks at Japan's cleanliness ethic starting from school days for children growing up with the idea that clean is what you make happen with your own two hands and a broom. That is all it takes and a sense of personal responsibility infused into the culture from school days as children.  For 12 years of school life from elementary school to high school cleaning the school is part of the school routine for students. The social consciousness was developed in this way and children as they grow up learn to take pride in their cleanliness and in the cleanliness of their surroundings. This carries over to cleaning up the neighborhood.  In India's Swachh Clean India campaign their are street clean sweepers in addition to people themselves taking on the job of cleaning. This is ok for public facilities like railway stations underbridges and other public facilities, but for neighborhoods and schools making cleaning a part of the routine in schools is a good idea that needs to be universally adopted as part of Swachh India, Clean India campaign. This also holds true for all Asian and Latin American, African nations which could learn from the keeping the country clean efforts of Japan and more recently India. As India shows not having done this well before is no reason for discouragement, getting started and keeping it going, building public awareness and support is the key. This is particularly true for developing countries because it is easier to prevent illness and disease by increasing levels of hygiene and sanitation, saving hundreds of millions of dollars for large countries like India and Brazil, Mexico, Nigeria, for days and productivity lost. It also pushes countries to the next stage of development faster through infrastructure development and quality of public services, quality of life.    ...

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The results from the EU elections show neither traditional centre right or centre left parties are able to form a majority. The euroskeptic parties in Italy led by Mr. Salvini and in France by Marie Le Pen have not won with the kind of support they expected. Also important is that these parties in Italy and France have changed their position on membership in the European Union. They now support remaining with the single currency the Euro, and staying in the EU, hoping to change it from the inside. In Spain the Vxx party on the right has from its inception supported the Euro and the European Union. Only Nigel Farage's Brexit party is for Britain leaving the EU. These parties such as the League in Italy and the National Party in France are in accord with globalism and global capitalism. The changes they call for are now on immigration, migration, and against a single market for labour with social services for new immigrants or migrants. They are for ending multiculturalism in favor of nativist national ideas, sweeping indictments of bureaucracy and elites, curbing migration and building national pride. In Spain their is also concern for separatist movements such as in Catalonia for the Vox party, and interest in stronger federal structures. There is no coherent strategy for these new parties to tackle problems such as lack of growth, widening regional divide within the countries. Yet now the discussions will be about what the  EU will do, not about whether there should be a single currency the Euro or whether to remain in the EU.  In this sense the European Union is set for the task of regenerating from within. The European Union was itself an experiment that started with the effort to set up the initial arrangements to bring together the economies and political structures of European countries after a disastrous war. It accepted nation states and individual country differences even as it sought an ideal of a united Europe. This means there is room for more ideas and for differences within Europe and the European Union than allowed for by existing structures, politics or ideas. ...

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Pakistan prime minister Imran Khan visits the White House to meet president Trump. Mr. Trump welcomes Khan and lauds the Pakistani leader as an athlete and a leader. He tells him trade deals can be struck, future was bright and flow of aid can be turned on. Trump makes a casual offer to help mediate the dispute between India and Pakistan over Kashmir, even though it is certain that nothing comes out of this, because of India's position not welcoming other countries doing any mediation. At the heart of this reconciliation is Afghanistan and president Trump's conviction that Pakistan can get the U.S. out of Afghanistan. Trump stated this- "I think Pakistan is going to help us out, to extricate ourselves. Pakistan is going to make a difference." The idea is that Pakistan can persuade the militants, the Taliban, into a face saving settlement that will allow American troops to come home. Mr. Khan in turn stated that Pakistan had given up its policy of using Afghanistan to give it "strategic depth" against India. The army would not go behind the back of the civilian government to conduct a policy of its own. Mr. Pompeo and Mr. Trump are impatient to get this done. The deadline of Mr. Pompeo is September 1 and talks continue between the Taliban and representatives from Afghanistan. The U.S. effort is handled by Zalmay Khalizad. How Afghanistan is governed in the future is not determined and Pakistan has a key role to play in making a sensible solution take place if it decides that something new has to be tried.  In the past U.S. governments from both parties lacked the ability to take a good hard look at the facts the origin and evolution of this dispute. To tackle it directly with a willingness not only to call it for what it is but also to give the other side an incentive to try new solutions. The inventive style of the Trump administration to tackle the situation directly, but also come up with new and novel solutions is what is now being tried. ...

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The importance of time and compound interest in investing cannot be overstated. Over long time horizons steady saving and investing using index funds such as Vanguard with low expenses can take advantage of compound interest to generate good returns. This happens for a strategy of dollar-cost averaging into broad indexes over longer horizons. The longer horizons help overcome fluctuations and volatility, even bubble behaviours, as compound interest plays a larger role. Investing based on timing is not viable because no one is prescient about the market. It is risky if this route of timing is taken because the investor ends up staying out of the market for long periods thus missing out on the power of compound interest to generate good returns. One way of looking at this is to take a $100 investment and see what happens by the sixth year on a calculator if it is invested at 10%, in the sixth year it generates 16% on the original $100.

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Self reflection by the boomers, born between 1946 and 1964 numbering some 78 million people, who gave commencement speeches this year from Ken Burns, documentary maker, at Boston College, to Democratic Senator Bennet of Colorado at Colorado College, on the mistakes of this generation. Senator Bennet used three figures to make his point about the failure, from 2000 the annual median family income declined in the US by $300, health care costs went up by 80%, and the cost of higher education went up by 60%. By contrast to this the so-called Millenials, born between 1982 and 2001, just want to see what works and get on with it, says Stefanie Sanford, an education expert. One graduate from the University of Kentucky, Julie Meador, a marketing major, is earning $7.50 an hour as part-time sales associate at Gap. Her view is that what she most thinks of is finding a good job, and not thinking of saving the world just yet.

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The failure of the Obama administration's HARP, Home Affordable Refinance Program. It was designed to allow certain homeowners who owe between 80% and 105% of their home's current value to take advantage of lower rates. It was limited to loans owned or guaranteed by Fannie and Freddie. The HARP program was touted by Obama administration as helping potentially 4-5 million borrowers to refinance. So far only 12,710 refinancings have been completed according to the Treasury department. According to Freddie Mac by refinancing borrowers on average reduce the mortgage rates by 1.3 and 1.5 percentage points, saving around $2500 on a $200,000 loan. Now a new development further aggravates the housing market recovery. On June 10, 2009 rates on 30 year fixed mortgages climbed to 5.79%, up from 5% two weeks ago according to HSH Associates. That increase cuts in half the number of borrowers with incentives to refinance, according to FTN Financial. Now refinance activity is way down.

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Prince Philip's career in the Royal Navy is remembered here in The Times. His service off the cost of Greece, at Gibraltar, and off the coast of Sumatra, on British Navy ships is recalled. Here he is seen saving airmen in the seas in the war against Japan near Sumatra, and in attacks on Italian cruisers after Italy invaded Greece. During this period till 1947 Philip served in the Royal Navy. When asked about any "if only" he had in a BBC interview, Philip once said there were none, except one about his career in the Royal Navy. Here he was following his uncle Lord Mountbatten. During his service in the war he leaned some things in the Navy that became part of his personality, the way he was, his style so to speak.  This was about being matter of fact, just doing it, never complaining, getting on with it. Philip was on the HMS Whelp on September 2, 1945, when the Japanese surrendered. He saw British seamen then who had been prisoners for many years, returning from camps. He recalls seeing tears stream down their cheeks as they sat with him in the mess on the ship and recognized the familiar environment, they could'nt speak. Shaped by these experiences Prince Philip reflected the values of devotion to duty, humility, respect for women, and feeling humbled by life's experiences. The experience in the Navy shaped his view of life. When asked about how he coped with wartime dead and wounded he once said - "we did'nt have counsellors rushing around every time someone let off a gun. You just got on with it." Seen out of context his remarks during the last few decades seemed blunt, seen in the context of the Navy and his formative experience in the ships in these years it was just the way it was. Simply who he was, as he once replied. With it also came the kind of dedication to country, being the "rock" of support that he was for Queen Elizabeth over many decades, and his unique style, now cherished by his family, the country and the British Commonwealth.   ...

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British budget cuts announced in Parliament by Britain's Finance Minister, George Osborne. About 83 billion pounds in cuts by 2015 were announced. But Joseph Stiglitz, writing in The Guardian, argued that the plan was a big gamble, as declining tax revenues with lower growth, would lead to smaller deficit reductions. The gamble is that the private sector will pick up, and make up for the reduction in public outlays. If this does not happen, this risks sending the economy into a tailspin. Osborne said that 490,000 jobs will be lost over the next 4 years, some from attrition. Payments to the long term unemployed will also be cut for those who fail to seek jobs, saving $11 billion a year. A new 12 month limit will be imposed on long term jobless benefits. Increase in the retirement age will start in 2020, from 65 to 66 years. At the same time free eye tests, prescription drugs and bus passes remain. Premier Cameron promised not to make cutbacks in health care in the period before the election. This was his way of helping the Conservatives make a comeback to power....

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With government spending currently at 24% of GDP, the budget proposed by Paul Ryan, chairman of the House Budget Commttee, proposes to bring this down to 22.5% in 2012, and to 20% by 2018. The Ryan proposal would cut spending by $5.8 trillion for 2011-2021, with spending $6.2 trillion less than proposed by the Obama administration. It is a bold effort by House Republicans to bring the deficits down from the $1 trillion plus levels of the last 3 years. Major changes are made under this proposal to Medicare, and Medicaid. People who retire after 2021, would choose from an array of private insurance programs, and the federal government would help pay the premium. Medicare under this arrangement would be a "premium support" system. Medicaid would become a block grant for the states. This proposal estimates a saving of $771 billion on Medicaid over 10 years. The Food Stamp program would also become a block grant system. In addition to this the top individual and corporate tax rates would be 25% instead of 25%, with the changes being revenue neutral as a series of tax breaks would be eliminated....

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Expensive new fuel saving technology investments at BMW to meet new pollution control standards in Europe (130 grams per kilometer) and boost fuel efficiency in the US. This year only 40% of its cars will meet 140 grams per kilometer. With a production total of 1.4 million cars BMW faces sizable investments with smaller car volume than the likes of Toyota and Honda. R&D costs have climbed 22% in first half 2007 to 1.5 billion euros. BMW has agreements to jointly develop some of the new technology with Daimler and GM on hybrid gasoline-electric drive cars. Its developing a new 3 liter diesel engine for the US market that cleaner and fuel efficient. BMW plans also to boost advertising budgets to promote itself as a fuel efficient carmaker conscious of the environment, See related article. It plans to expand in India China and Russia to get a share of the expanding markets there. BMW's second quarter profit fell 23% on a 7% gain in revenues underlying the additional investments BMW faces. CEO Reithofer wants to increase profits to above last years 3.75 billion euros. ...

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The Chinese 90 seat regional jet called the ARJ21 made by government run AVIC I Commercial Aircraft Company has about half of its equipment supplied by US companies. Its maiden flight is Septemeber 21. Canada's Bombardier is investing $100 million in the larger version of this plane citing parts sharing and cost saving potential for its own jets. The Chinese market is expected to grow at about 9% annually according to Boeing's forecast. China will spend about $600 million on the program for ARJ21 according to Chinese aviation officials. The ARJ21 also called the Flying Phoenix has 206 of the 300 orders it needs to breakeven. The plane is targeting the high altitude airports and the lightly travelled routes of western and central China. China is also looking to sell the plane in emerging markets of Malaysia, Turkey and India. According to General Electric China will need at least 500 regional jets over the next 20 years. GE which makes the engines for the ARJ21 sees the 500 jets equal to engine orders of $15 billion. Other companies that are looking for supplier orders are Parker Hannifin, Goodrich, and Mitsubishi....