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Unemployment in the eurozone drops to 7.7% in 2017. Unemployment in Spain drops to 17%.

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The British parliament votes 321 to 278 on a motion that rules out leaving the UK specifically on March 29 without a deal negotiated with the European Union on future relations. The margin of votes was 43. Thirteen government ministers abstained from the vote. The repeated votes in parliament are a tactic used by the prime minister Theresa May to get her party members to back the deal she has negotiated with the European Union. The ruling Conservative party is split on whether to leave the European union and if so what the relations should be between Ireland and Northern Ireland, whether Britain should remain in the customs union of the EU.   The repeated votes have only exacerbated and made worse than before the divisions in the Conservative Party, leading to a view that only a second referendum can break the deadlock. The indifference shown in France and Germany by business and the public to Britain's membership, and the manner of handling of the immigration crisis by Chancellor Merkel with large numbers of African and Arab immigrants entering Germany, have contributed to the dissension in Europe over Britain's right to control the flow of immigrants across its borders. The deeper Merkel positioned the ruling CDU party to welcome migrants in 2016-2017, the more skeptical the British public became on the free flow of people in the EU leading to the large bill boards on open immigration in Europe during the referendum on EU membership and the small margin in favor of leaving the EU. Austerity policies of Cameron and Osborne over two terms only increased the divisions of British society. The lack of good leaders in the Conservative Party has worsened the crisis. Theresa May comes from a London constituency which voted against leaving the EU, yet has taken up the leadership of the different Leave factions in the Conservative Party as she sought the position of prime minister after Mr. Cameron. Prime Minister Cameron promised the referendum on EU membership in a ploy to win votes in a closely contested general election and called the referendum not anticipating the result, and resigned as  prime minister. By being against Britain leaving the European Union, yet willing to use the issue for opportunistic vote getting in a close election Cameron and other politicians in the Conservative Party split the country in what some have called an act of recklessness. The votes in parliament and possible fesh elections, a second referendum, are a way to find a solution to this mess.   ...

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Spain's banks have government debt holdings as a percentage of bank assets of 6.8% compared to 13.1% for Italy's banks. This is based on data available from the IMF. But Italian banks are far better capitalized than Spanish banks. Bank shares of Italy and Spain hit post Lehman lows in July 2011, but Italian bank shares are likely to recover faster than Spanish bank shares. Italian banks raised 8 billion euros of capital in 2011 and most banks have an average core Tier 1 ratio of over 8%. By contrast Spain's bank sector is perceived by markets as undercapitalized and the IPO's of savings banks Bankia and Banca Civica will be affected by the unsettled markets.

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Members of the U.S. Congress lead a lousy life with life split between the capital and their home state location, most are weekend dads or moms. This makes them less likely to grasp the issues of work-life balance and the issues of parenting faced by average working families or couples with both parents working, says this essay in Politico magazine. This is true also of understanding issues facing women and mothers. Hard to believe but this report points out that Congress in the U.S. does not have a family friendly leave policy and no restroom for women till 2011 on the floor of the House. Similar issues face women in Japan and other countries for women in parliament. Former Speaker Ryan says he is tired of being a "weekend Dad." Senator Biden, former vice president says of his commute from Delaware to Washington D.C., he realized that "a child has a thought he wants to share and 12-18 hours later its gone, gone, gone." ...

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Strikers at a Honda transmission factory in Hoshan, 100 miles northwest of Hong Kong are asking for raises of $117 or 800 renminbi in cash above the $132 a month or 900 renminbi that they are now paid. About 950 of 1900 workers at the plant are trainees, young people from vocational schools or high schools earn $132 a month. Older employees earn upto 1500 renminbi or $220 a month. The significance of this strike is that the Chinese government is tacitly encouraging the strike as it begins making moves to increase domestic consumption and make the economy less dependent on exports. This requires consumer's having larger purchasing power and higher wages. It also means that China will not remain the low cost manufacturer for manufacture goods makers around the world for very long. Consider the size of the increase and the policy change of the government and this implies a significant shift by China.

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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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The pro-independence party of Catalan president Arturo Mas called an election two years ahead of schedule in an effort to increase autonomy for Catalonia in relations with the central government of Spain. He failed in negotiations to reduce the tax burden for Catalonia in relations with the federal government in Madrid. Arturo Mas's party lost seats in the regional election, ending up with 50 seats compared to the 62 seats it held previously in the 135 seat regional parliament in Barcelona. Other pro independence parties gained seats. The left leaning Esquerra Republicana de Catalunya party increased its seats from 10 to 21 seats. The Partido Popular of Spain's premier Rajoy won 19 seats, up one seat from the 18 it held earlier. There is considerable questioning inside Spain about whether this issue should be brought up at a time of 25% unemployment and negotiations with the EU for loans to restore the health of Spain's banking system.

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S&P downgraded France's credit rating from AAA to AA+ on Jan 13, 2012. S&P downgraded Italy's credit rating to BBB+ and Spain's credit rating to A. The AAA ratings for Germany, Netherlands and Finland were left unchanged. S&P stated its reasoning: "Today's ratings actions are primarily driven by our assessment that the policy initiatives that have been taken by European policy makers in recent weeks may be insufficient to fully address ongoing systemic stresses in the eurozone."

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Spain's Budget minister, Cristobal Montero, said the government would have a new credit line and provide an early infusion of $10 billion to aid financially troubled regions. Many of the regions are in such financial straits that they are unable to pay suppliers, and this is putting many small businesses in serious difficulties. Spain's prime minister Rajoy says the Spanish government needs to be concerned about what is happening in the regions, and that he would help regions as long as they meet their budget goals. Spain adopted a decentralized model after the years of the Franco dictatorship, and regions handle education, health care and social services, culture and providing services. With the economic crisis following years of free spending by the regions, the extent of this autonomy and the lack of budget controls is being called into question. Officials from regions such as Aragon, Valencia and Murcia have called on the federal government to play a bigger role.

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Spain opened the books for regional governments to reassure investors. The figures show the average deficit across 17 regions at 1.24% of GDP at the end of the third quarter, according to the Finance Ministry. Risks include additional spending items in the final quarter and a further drop in tax revenues. Fore several years before the current crisis even when the central government was running a surplus, Spain's local and regional governments ran deficits. Regional governments account for about half of all public spending in Spain, compared to 20% for the central government, with social security accounting for the rest. Catalonia was forced to raise money through patriotic bonds, and Valencia is also following this, as Spain's regional governments have been shut out of international credit markets. Moody's Investor's Service provides a different perspective, as it said in November 2010 that Spain's regions will find it "very challenging" to meet their budget targets for this year and next. Moody's view is that the central government has strong incentives to come to the aid of regional governments should they be shut out of credit markets for an extended period. The Zapatero administration lacks a majority in Congress and depends on regional parties for support. Madrid's municipal government has requested funds to refinance its 7.2 billion euros debt. About 4 billion euros went into putting the capital city's ring road underground. Regional government's will need to refinance 30 billion euros in debt in 2011....

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Michael Birnbaum, the Post, Moscow bureau chief talks to experts and politicians in Moscow about the economic situation as the ruble declines by 36% since July, with the fall in oil prices accelerating its fall and reducing the impact of central bank intervention in slowing the decline. He cites a Putin interview with Tass news agency in Nov. which he says a tieup is possible between the U.S. and Saudi Arabia to bring down oil prices as a way to strengthen the effect of sanctions in changing Russian policy. Russian Finance minister Anton Siluanov says lost oil revenue impact is about $90 to $100 billion a year, added to the cost of sanctions at $40 billion. Significant capital flight also adds to the overall cost. Russian companies borrowing in dollars have large debt payments due that will need to be supported by the Russian government, an added cost. This will put the Russian economy in recession in 2015. The central bank expects inflaion at 10% in 2015. Large losses of this magnitude will be harder to sustain and deplete international reserves of $429 billion as of Oct. 2014. The thinking of ordinary Russians is reflected in an independent Levada Center opinion poll showing 61% of Russians expecting a decline in living standards and economic crisis in the near future. The man most responsible for stabilizing Russia's finances, former finance minister Alexei Kudrin, who had profound public disagreements with president Medvedev over increases in the military budget, warned of an economic crisis following the parliamentary and presidential elections. A major weakness of the Putin-Medvedev second and third terms is the failure to use higher oil revenues to expand the tech sector and other industries to diversify Russian exports away from oil. ...

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