LyrArc Article Gist
The 140 billion in stock market losses in GE stock in just the last 12 months (2017-2018) ranks as the worst in history in the corporate world. In this report a retired GE worker at 61 years is shown looking for a second job after the losses wiped out a substantial part of his retirement savings in the form of company stock. This is the worst in history and is about twice that in market losses for Enron, and more than the losses in bankruptcies of GM and Lehman Bros. As a result GE is one of the worst funded pension programs in the corporate world. About $100 billion in pension obligations for 600,000 people who get GE pensions is underfunded by $30 billion. GE will need to borrow $6 billion in 2018 to contribute to the pension plan.

LyrArc Article Gist
"Not ideal" says Ben Stokes, "yeah disappointing" says Steve Smith, about the 10mm of grass on the pitch that led to 20 wickets on the first day 36 wickets by the second day. Cricket Australia is disappointing a lot of fans when the Test match at MCG cricket grounds is over in 2 days- not since 1904 has something like this happened at MCCG- and there is an investigation, too much left to the cricket grounds preparation experts without supervision by Cricket Australia. Stokes says to be brutally honest it was bad for 90,000 fans. About England critics after losing 3 Tests, Stokes says that now goes to zero the idea of England not having won at all. Stokes and Root hug in the locker room, a sign of relief.

LyrArc Article Gist
Andrew Ross Sorkin points out that investors are sitting on their hands and money is moving out of the stock market. About $171 billion has moved out of mutual funds over the last year, according to the Investment Company Institute. About $208 billion has gone into the bond market in the same period. There are now fewer long term investors and the market is dominated by professionals which increases the volatility. There is a lack of confidence in the economy, the same reason that businesses in the U.S. are sitting on $2 trillion in cash that could be invested, and for investors the feeling that the market is rigged to favor insiders. The Financial Literacy Group surveyed 878 students at 18 high schools in 11 states in the U.S. It found that three fourths of the students agreed with the statement: "The stock market is rigged mostly to benefit greedy Wall Street bankers."

LyrArc Article Gist
Of the world economies facing GDP decline in the first quarter of 2009, Germany saw adecline of GDP for first quarter over prior year of 14%, Japan 15%, and the USA 6%. Mexico was hit hard with adeckin of 21%. Auto production in Mexico fell by 41% in the first quarter over the prior year.

LyrArc Article Gist
Pakistan gets a $7.6 billion IMF loan with $4 billion disbursed this year and the rest in 2009. Interest at 3.51% to 4.51% with repayments beginning in 2011. Pakistan faces 25% inflation and reserves enough for 2 months imports. It needs between $10 billion to $15 billion over the next 2 years say Pakistani officials.

LyrArc Article Gist
Abbott Labs acquisition of Piramal Healthcare for $3.7 billion gives it 7% of the Indian market. Acccording to IMS Health emerging markets drug sales for 17 countries went up from $42 billion in 2000 to 126 billion in 2009. Anlysts expect 70% of global growth to come from these areas in next 5 years.

LyrArc Article Gist
Chile, Mexico and the U.S. rank high in the diabetes rate for top soda consuming countries. In the U.S. the diabetes rate is at 7.7% of the population, in Chile 9.6% and Mexico 9%. Soda consumption per capita was at 165 litres in the U.S., 146 litres in Mexico and 134 litres in Chile, and 145 litres in Argentina where the diabetes rate is at 3.9%, for 2012. A new public service ad in Mexico City subway stations says it all, showing an ad with a soda bottle and the words- "Would you take 12 teaspoonfuls of sugar? Soda is sweet, diabetes isn't." The new Pacto de Mexico agreed to by all major political parties includes the soaring diabetes rate in Mexico as a problem to be tackled, including lunches at public schools and the consumption of coke and sodas by children. A particular acute problem in Mexico is the lack of clean drinking water in many areas and the dependence on coke and sodas for liquids. But bottled water could be used in its place if available at lower prices. One proposal is for a soda tax which could generate $2 billion and be used for setting up clean drinking water fountains in schools and other places. Elected officals in Mexico are firm about the need for action, as Mexico recently became the first country over 100 million inhabitants with the highest obesity rates at 7 adults out of 10 over the age of 20 obese or overweight, and the consequently high diabetes rate. Diabetes is the No. 2 killer in Mexico, and a serious health danger. Coca Cola gets its second highest revenues from Mexico after Europe, and the situation has evolved after years of heavy coke advertising to the point where Coca Cola is taken at every meal by some Mexican families, and is a sign of prestige. The company's response is to fight the public service ads with ads showing people burning off 149 calories by walking. The country now faces a long and uphill fight. Russia is one of the countries which is also conducting a similiar fight against soda drinks. The Bloomberg Philanthropy is financing efforts against soda drinks in Mexico, as part of its campaign against smoking and sodas as health hazards, and this maybe Bloomberg's bigger contribution to society than his service to New York City. Developing middle income countries such as Mexico, Chile, India, China, Brazil, are the hardest hit by soaring diabetes. And the costs to their health systems in 10-20 years from uncontrolled obesity and diabetes will be enormous. The U.S. is a developed country with similiar high rates of obesity and diabetes, with soaring medical costs, and serious problems that strangely have not received the public awareness and efforts that one should expect. ...

LyrArc Article Gist
State owned shipbuilder Vietnam Shipbuilding Industry Group (Vinashin), defaulted on a $600 million loan in December 2010. Inflation is running close to 12% in December from a year earlier, and the Vietnamese currency, the dong, has lost a fifth of its value since mid- 2008. Vinashin borrowed heavily with the idea of becoming a leading shipbuilder, and nearly collapsed in mid 2010 with $4.4 billion in debts. Top executives were arrested for mismanagement of the company. Vietnam faces a problem faced by other emerging market economies in the past- it has only small foreign exchange reserves, which may be why it decided to let Vinashin default. The $14 billion the IMF reported for Vietnam as of September end 2010, is not enough to cover the short term debt of about $6-$7 billion and a wide trade deficit of $12 billion according to a credit markets strategist at UBS AG in Singapore. Experts say Vietnam has not learned from the lessons of other emerging market countries in Asia that faced a financial crisis in the 1990's. The central bank estimates credit will go up by 28% in 2010 over 2009. The government is focussed on growth, and experts are pessimistic about any changes at the coming party congress or in policies of the government. The Communist party promotes officials on the basis of their ability to hit growth targets and meet five year plans- with little regard for inflationary effects and corruption. One government official says the only thing the Communist party understands is growth and this is why little change can be expected. ...

LyrArc Article Gist
Chrysler is beginnning the effort to cut dealership that aren't sellin enough cars. Note the figures for dealerships, GM 6900, Ford 4200, and Chrysler 3700, Toyota 1400 for market share, GM 23%, Ford 16%, Chrysler 14%, Toyota 16%, This comes to 300 delaers per market share point for GM 280 for Ford, 270 Chrysler, 90 for Toyota. Lower producing dealers and surplus dealers undercut prices of stronger dealers and everyone in general.

LyrArc Article Gist
Indian salary growth is expected to be 15% a year and salaries for professionals doubling every 5 years based on GDP growth for Vikshit Bharat 2047 of 12% per year. This is why India will seek to limit migration to legal migration only and further limit the brain drain by creating attractive opportunities in India, including ones from GCC's or global capability centers of foreign corporations in India that are expanding as US reduces its overdependence on China for manufacturing and returns jobs and factories back to the US.

LyrArc Article Gist
The top 20% of Americans own 87% of the stocks powering most of the spending in 2025. Upward trends in the stock market in the US with resilient markets overcoming the Liberation Day tariffs announcement, are powering the spending by higher income professionals and business people. WSJ looks at the people owning stocks ages 36 years to 77 years, and their spending on cars, furniture, home renovation and travel. The situation is not so good for middle class Americans living from paycheck to paycheck, students and young people.

LyrArc Article Gist
Germany's kurzabeit or short work system avoids layoffs in a crisis. The Bundestag parliament in Germany quickly reintroduced it following the coronavirus. It provides subsidy to employers so that wages of upto 2500 euros can be paid to employees. The German parliament changed the requirement that makes it law fro a 30% of workers of a company being impacted by a crisis to 10%. About 2.3 million workers will benefit at a cost of 10 billion euros says this report in The Financial Times. The Federal labor office has a fund of $26 billion to which workers and employers contributed just for this purpose of safety net.  Workers get about 60% of their wages under this scheme while the crisis lasts. The last time it was used during the financial crisis of 2008-2009 1.3 million workers benefited from this scheme to prevent layoffs.  Germany with its strong vocational training system invests in worker training. The logical next step was to preserve this knowledge component of workers and avoid its loss through layoffs due to some crisis that is temporary and beyond the control of the company. Britain is adopting this idea this time with the British Treasury supporting  80% of lost wages upto 2500 pounds a month in the new economic aid package announced by the British government. Spain has a scheme under ERTE for 70% of wages to be paid as safety net. France has set aside 8.5 billion euros aid for assistance to workers in a similar scheme as safety net. ...

LyrArc Article Gist
The first round of France's parliamentary elections show president Macron's party, La Republique en Marche, winning 28% of the vote. The turnout was low, below 50%, below the turnout of 57% in 2012 and 60% in 2007. The Republican Party gained 22% and the National Front 13%. The Socialist Party lost heavily gaining only 7% of the vote.

LyrArc Article Gist
Subaru makes 80% of its cars in Japan compared to 21% for Honda. Toyota also makes a larger percentage of its cars in Japan. The swing in exchange rates bringing the yen to 116 to the U.S. dollar is likely to benefit both exporters. Experts expect both companies to launch a product offensive in the U.S. market and and not start a price war with American makers. Subaru sales of Forester and other models surged 18% in 2014 to about 500,000 cars in 2014. Toyota is the largest shareholder of Subaru's parent company Fuji Heavy. Fuji shares have quintupled since Nov. 2012. Subaru has always pursued a strategy of making in Japan to keep high product quality, according to CEO Yoshinaga, with half of its sales coming from the U.S. market. For the year ending March 2015 Fuji Heavy net profit is expected to reach $2 billion.

LyrArc Article Gist
Panasonic's decision to close a plasma television plant in Shanghai. Panasonic is now focussing efforts on new OLED television technologies with four times the resolution of high definition sets. At one point in early 2011 plasma represented 40% of Panasonic television sales, in the current fiscal year ending March 2013 plasma will be down to 16%.

LyrArc Article Gist
China's effort to tie Vietnam and Malaysia to its economic system- will it work? China has trade worth $982 billion with 10 neighbors in South East Asia compared to trade of $786 billion with EU and $688 billion with US.

Some of that $982 billion is product shipped to Vietnam by China, assembled there and shipped to the US. This is why DJT/USTR put 46% tariff on Vietnam, now reduced to 10% for 90 days till negotiations. President Xi of China visited Hanoi, Vietnam, to sign 45 bilateral cooperation agreements to bind Vietnam closer to China's state run capitalist system. At the same time premier Lam of Vietnam is seeking negotiations with US and has talked to president Trump. What is going on? Vietnam hope to have ties to both US and China. Will it work?

 

LyrArc Article Gist
Of the people asked the question "what issue do you see as the most important for health care" 44% in a NBC/WSJ poll said they considered Cost as the biggest issue, and 37% said that they considered the Uninsured as the biggest issue, 11% said quality of care was the biggest issue. The President is focussing on cost as he develops the health care plan. He is also saying that to provide health care for all and cover the uninsured without controlling costs would break the bank. Another thing that the White House shows it has learned from previous failed attempts, is that it is doing this with an open Health Care Forum with participation of different sides in the health care discussion. Clinton's effort in 1993 ran into problems because it was developed secretively, and without much discussion, and little effort to get different people's views. The previous attempt also waited too long after the election, and this time the President is moving quickly when he enjoys large popular support. Its also true now that there is serious concern especially in this downturn of what a threat spiralling costs of health care are becoming to the future prosperity of the American people. This time the leaders in Congress are setting an aggressive schedule to get health care palns legislation on the floor by June and get a floor vote in August 2009....

LyrArc Article Gist
Norway's sovereign wealth fund, the Government Pension Fund Global, is run by Yngve Slyngstad. The fund has $570 billon, $100,000 for each of Norway's 4.9 million people. The fund took a 23% loss in 2008. Then the fund made a shift from 40% equity holding to 60% equity holding, which has paid off. The losses were reversed with a 26% gain in 2009 and a 10% gain in 2010. The fund gets all of Norway's oil revenues less about 4% of the fund's value that goes to the state budget. Slyngstad became CEO in 2008, and persuaded finance ministers to take on greater risk, leading to $175 billion in stock investments during the financial crisis. He has told Parliament that he will get returns of 4% after inflation- higher than returns of 3.1% that were made since 1998. With assets equal to 2% of the total market value of stocks trading in Europe, the Norwegian fund is a major investor. Rules set for the fund prohibit investments larger than 10% in any one stock.

LyrArc Article Gist
Malkiel says both sides in the investor debate are right. Those saying the CAPE ratio in the U.S. at 25, well above long run average of 15, are right to point this out. So are the others in the debate who point to the lack of alternatives for investors when the 10 year Treasury bond is at 2.4% and short term rates essentially at zero. Stock prices reflect the discounted present value of future cash flows from dividends and capital gains. This discount rate in 2014 has to take into acount the rate on low risk securities such as 10 year U.S. Treasury bonds and and a premium for riskiness of the stock market. Add three or four percentage points to this and one gets a low discount rate for future earnings that helps support reasoning for higher stock prices, says Malkiel. On the issue of low interest rates Malkiel's view is that they will be around for a long period because the unutilized productive labor capacity and low growth are likely to persist for a long period. Here he supports Fed chairwoman Yellen's view based on the U6 labor utilization. He also sees the long run equity returns from today's prices to be much lower than the 10% long run average. By accomodating both sides Malkiel supports a broadly diversified portfolio with adequate room for emerging markets and international stocks....

LyrArc Article Gist
Andy Street, Mayor of the West Midlands Combined Authority, says when you consider that London gets 7 times the infrastructure spending per person than West Midlands, "its not bloody surprising" that his region is not growing fast. West Midlands covers a large part of central England, including Wolverhampton, Birmingham and Coventry. Even life expectancy is lower by 8 years in Blackpool, and disposable income can be quarter in Camden compared to North London. Labor's Corbyn and Conservative's Thatcher in the British general election are both campaigning for reviving the regions outside London, that have seen investment in people and technology lag substantially behind London. Regional revival is the big issue in this election. Consider that London which accounted for about 15% of economic output in the 1980's now accounts for nearly 25% of economic output of Britain. Berlin is about 4% of Germany's economy, and Paris 10% of France's economy. A word of caution on Brexit is sounded by experts at the University of Birmingham, who say the whole process of Brexit is so complicated that it may detract from the task of reviving this region. Even though the political upheaval had origins in this discontent, was it more about shifting government attention to the gap between London and the rest of the country, and less about a complex process of withdrawal from the European Union. ...

LyrArc Article Gist
Patel's speech on August 15 1948, provides a point of reflection for Gandhi's project of Hind Swaraj announced in his book Hind Swaraj written on a steamship voyage in 1909 returning to South Africa from England, and this week's Vikshit Bharat 2047 vision taking shape 75 years after 1947. Hear this audio podcast from All India Radio of Indian Deputy prime minister Sardar Vallabhbhai Patel's broadcast to the Indian Nation on Aug 15, 1948. It  is a point for reflection just one year after independence when the "paramountcy of the British inIndia came to an end," yet it was not clear that India would be pulled together as one Nation or be in pieces "Tukda, tukda." 75 years ago Patel talks about the situation in China where civil war raged- on that day the NYT showed Koumintang and Communist armies facing each other near Nanking and in Shantung province. Hyper inflation had already hit Shanghai a sack of rice cost 6.7 million yuan and the highest denomination currency was 180 million yuan, the Kouminatang decided to print money to fight the civil war.  Malaysia had riots and communist insurgency was about to take place. Synghman Rhee was made president of South Korea with US Gen. Douglas McArthur present in Seoul and the invasion by Communist North Korea on June 25, 1950 was around the corner.  Israel's Ben Gurion asked the UN to have Arab armies withdraw or it would have to go to war. In India the Kashmir invasion in the Himalayas starts on 12 September 1947 with Liaquat Ali Khan approving plans for tribals and Pathans to attack Kashmir.The states of Hyderabad, Travancore and Junagadh among princely states(which were one third of the British Empire) that had not been integrated. In Europe the Berlin Blockade had started in June 1948. This is the Asia and Europe that Patel saw in 1948 as he pondered on the meaning of Gandhi's success and what had still to be achieved. It is also a point of reflection in advance of  August 15, when India gained its freedom from British rule and set the stage for the decolonization of Indonesia from the Dutch, of Vietnam from the French, and Malaya from the British, followed by decolonization in all of Africa. ...

LyrArc Article Gist
Under a proposed capital infusion into Peugeot the French government, Dongfeng Motor of China, and the Peugeot family would each control 15% of the company. Dongfeng and the French government would buy new shares of about $7.50 to $8 each, and providing 800 million euros each. The Peugeot family would provide 100 million euros. Currently the Peugeot family controls 25.4% of the shares and 38.1% of voting rights. Earlier GM sold its 7% stake in Peugeot, and Peugeot turned to its partner in China for the capital increase. Peugeot shares declined by 11% to 10.21 euros on Jan 23, 2014, as a result of investor concerns about the prospect of three different shareholders interests. Peugeot expects to use the capital increase for technology investments as it struggles to come out of a prolonged slump in its European markets. One of the conditions made by Dongfeng Motor is that the current chairman Thierry Peugeot be succeeded by an executive not connected to the Peugeot family or the French government....

LyrArc Article Gist
Public opinion experts in Israel say President Obama's policy in the Middle East is seen by a majority of Israelis as reflecting a sound judgement. Obama's approval ratings in Israel are up 13 percentage points compared to 2010. It is now 54%, according to December opinion polls by Mr. Telhami, a University of Maryland professor who supervised the surveys on Israeli opinion. Only 19% of Israelis now support Israel attacking Iran's nuclear facilities without U.S. support, according to the University of Maryland survey by Mr. Telhami of 500 people, that was annouced last week.

LyrArc Article Gist
To ensure a recovery in profits in 2010-2011, Ford's strategy was to sell the Focus and Fiesta small cars at a higher price point even if this meant lower sales. Profit margins for the North American region were above 10%, and Ford's president of the Americas, Mark Fields, says this will be maintained for 2012. In the first 3 quarters of 2011, Ford's profits were $6.6 billion. Analysts for Edmunds.com say Ford has shied away from offering large discounts, subsidizing leases and other incentives, and tried to maintain higher margins. The average price for the Focus of $20,589 being higher than average prices of rivals except for the Jetta from VW, according to Edmunds. The average price of the Fiesta is higher than rivals except for the Honda Fit, according to this information. Focus sales increased by 2% in 2011 over 2010, even as compact car sales went up by 8.7%, according to Autodata. Sales of the Fiesta actually fell by 30% in December 2011 compared to the prior year. The result of this strategy is that inventories of small cars are up significantly for Ford. By 2011 years end Ford had on dealer lots inventory of Focus cars at 92 days current sales, and Fiesta cars at 126 days. Normal inventory is considered less than 60 days supply. By comparison GM had a 68 day supply for the Cruze, and a 61 day supply for the Chevy Sonic. The challenge for Ford is to hold on to its pricing strategy, which means reducing production to work off the extra inventory....

LyrArc Article Gist
The title says it all. The Jobs bank the United Autoworkers trade union in the US setup in GM in 1984 threatened American automaker GM's very survival in 2006. It put workers who were not needed at GM in a jobs bank. It basically meant the idled workers -many of them close to retirement -would stay there till they retired doing nothing collecting full salary. As Mohandas Gandhi had done for India in Hind Swaraj in 1910, the American labor movement needs to look at itself in the mirror if labor is to find its way into a world of dignity and fairness in wages that Mr.Biden truly seeks for American workers.   It was setup when GM had 45% of the US market and 415,000 workers. By 2006 113,000 workers were not needed with GM having lost marketshare to Japanese makers and the Jobs bank was costing GM about $10 million a week, half a billion a year threatening its survival. The Labor movement and the UAW union did nothing to fight its own membership and set it on the right course in union with management, putting at risk the very foundation that labor had put in place since Wilson, FDR and Truman for  fairness in wages and working conditions. Jeremy Peters tells the story in the NYT. That it was recent as 2006 and shows how much had gone wrong with the labor movement and the failure of its leaders to do the right thing. The Jobs Bank says NYT was intended to prevent manufacturers from shifting manufacturing overseas, instead it did just that by undermining confidence in unions and the American labor movement, and in American workers. Two crippling wars initiated by Republicans Bush and continued by Democrat Obama, disinvestment in American manufacturing, companies like Apple shifting their entire manufacturing through outshoring to Taiwan and China, the 2009 crisis from deregulation of American banks, led to the loss of not one, but two decades for America. In today's news a modest $2 in minimum wage increase from $15 to $17 over 3 years is all that New York governor Kathy Hochul could get- even though Assembly Democrats were asking for more- to give American workers and families a fair wage to meet the cost of living crisis.  ...