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The Trump administration proposes a zero policy for Iranian oil imports which says the U.S. will grant zero exemptions to countries importing Iranian oil.  Big importers China and India are likely to resist this policy.

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Boeing's goal is to make 10 Dreamliners a month by late 2013. The current rate is 2 per month, which Boeing hopes to move up to 2.5 a month by November 2011, and 3.5 a month by early Spring. Boeing CEO, McInerney, says it will take a few years before each Dreamliner turns a profit. He expects this will happen before 2020. The large investment during this decade should see returns in terms of an annuity for 25-35 years, said McInerney. The Dreamliner is the first jetliner to be made largely of plastic-composite materials, in place of aluminium. To build the Dreamliner Boeing had to accomplish what McInerney calls "game-changing innovation," and at the same time achieve improvements in production techniques. Jim Albaugh, head of Boeing's Commercial Airplanes division, says the next step is to take what takes an hour and half to assemble and bring this down to 15 minutes. This will help meet a long backlog of orders. Boeing has 820 orders for the Dreamliner as of Sept. 2011. The first Dreamliner was delivered on Sept. 26, 2011, to All Nippon Airways....

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The ECB reduced a short term lending rate to 0.75%. The People's Bank of China reduced its one year yuan lending rate by 0.31% percentage point to 6%. The Bank of England increased its bond buying program by 50 billion pounds to 375 billion pounds.

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NYT reporting on the wealth of China's elite is followed by restrictions on journalists. Visa restrictions were eased for students, tourists and business travellers, but tightenend for journalists under the Jinping administration in 2014. This NYT editorial says NYT will not succumb to pressures from the U.S. or any government, including China, to change the high standards of reporting, and will continue to meet the fair reporting needs of its readers worldwide.

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Apple maintains its grip on the tablet market with its iPad at $499. Experts at Wharton and the Stern School of Business say Apple has found the strategically right price to maintain a dominant share of a rapidly growing market. So rapidly growing that some estimates show tablet computers surpassing PC sales by 2013. Apple CEO Tim Cook, has the logistical expertise that helped him work out the right price. The Kindle at $199 is hardly profitable by some estimates. Samsung has a smaller tablet at $499. In 2011 Apple saw its tablet market share decline from 87% to 68%, according to IDC Research, but still able to get a dominant share of sales. Apple uses the same approach to pricing for the iPhone. The profits generated on large sales and higher margins helps Apple invest in new products.

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The Economist points out the shortcomings in Indonesia's effort to attract foreign investment and increase growth under the Widodo administration.

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The yen is 34% stronger than the Korean won since mid 2008, hurting Japan's competitive edge. This affects exporters like Toyota which sees annual profit reduced by $390 million or 35 billion yen for every one yen appreciation against the dollar. The dollar now trades at 88 yen over 30% stronger than the precrisis level in 2008. So how does the new Japanese government see this. Prime Minister Yukio Hatoyama and the Bank of Japan have made comments suggesting that they favor a stronger yen, making imports cheaper to help spark a rebound in consumer spending missing in Japan since the 1980's. This would reduce the dependence on exports for growth, something that severely hurt Japan and Germany when the world economy took a dive late last year in the global financial crisis.

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Citing Alexis de Tocqueville, the Russian President makes a plea for writing a new page in Russian-US relations, by working together, because he says the world expects the two countries to take energetic steps to establish a climate of trust and goodwill, and not to languish in inaction and diengagement. Medvedev says he was greatly impressed with Obama's inaugural address and its unbiassed assessment of America's problems, the need to change together with the rest of the world. Its a kind of call to action, to restart cooperation and working together, building trilateral cooperation between the EU, the USA and Russia.

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The PBOC, China's central bank, injects $65 billion into China's banking system in Dec. 2014 to get banks to increase lending as the economy slows further. Experts say the growth rate is likely to drop below 7%. At the same time the central bank and economic policy makers are concerned about excesssive debt in the economy, shadow banking and local government debt risks. It cut benchmark interest rates by 0.25% in 2014. Other risks are developing as the property market cools off and investors shift investment to equity markets creating a surge of 50% in the Shanghai and Shenzen stock exchanges for 2014. As a result economic policy is not as effective in today's environment.

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This is something new, building budget hotels using stackable metal containers. Travel Lodge a British chain is doing this using as supplier Verbus Systems that builds roms in metal containers in factories near Shenzen, China, and delievers them ready to be stacked into buildings upto 16 stories tall. In this way a Verbus manager says it can build a 300 room hotel in 20 weeks. One is coming up in Oxbridge a West London neighborhood, and one near Heathrow airport.

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Comment by a former Tory leader, Sir Ian Duncan Smith, on negotiations with the European Union's Ursula Leyen, show how much the term sovereignty has become the word on which everything depends. Smith said on December 10 about the EU demands that Britain adhere to EU environmental and other rules after leaving the EU, "either Britain is sovereign, or it is not."  The word sovereign is discussed in this context in this Times analysis. The word comes from the old French word "sovereinete" during the period when the King's authority was being contested by feudal lords in 16th century France. The Oxford dictionary defines it as the authority of a state to govern itself, and to do this without outside interference. Tory leaders such as David Davis and others including Smith see this as meaning making your own laws. For the European Union to insist on its laws being primary and British law asked to conform with EU law making it secondary, would not only be outside interference, but also divided authority. Older French and British political philosophers Hobbes and Rousseau see this as divided authority. Even though the meaning has changed in modern times, the essential definition in the Oxford Dictionary remains undivided authority. Which is why these Tory leaders insist on the original definition as the right one. Behind the wrangling there is the sense among Leavers that Britain could do better in economic terms by setting its own direction, and doing business its way. How would a new economic power in India by 2030 affect Britain, would it create many more opportunities for Britain to grow because of its history and cultural ties. Could the relationship with the U.S. provide more opportunities for growth? What about French indifference and even disdain of Britain, does Britain have other options? Isn't the European Union merely a Franco-German alliance led politically by France and economically by Germany, and propelled by their three wars since 1871, with a bunch of European countries added in, and what has Britain got to do with it? Closer to the negotiations with Leyen there is also the question - isn't France trying to make certain with its demand that Britain not violate EU law, that Britain's ingenuity and free wheeling spirit outside the European Union does not let it grow faster than France? Where one gets Boris Johnson's immediate reply that Britain is better off not being stuck inside "EU's regulatory orbit."   At the other end of the world you have India with "Atman Nirbhar Bharat" calling for a self-reliant economy and taking the time for transitioning out of the trade relationship with China, at short term cost and long term advantage. Britain is closely watching India as it makes big strides in developing infrastructure, in renewable energy, and setting a bold vision for the future. Even France is mapping out a pathway to self-reliant economy as it looks at ways to bring production home after the pandemic. The pandemic has only reinforced the drive to be self-reliant. ...

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Seen in a larger context, the Biden tax pledge seen from the southern and midwestern and less well off states is not about taxes, it is about federal revenues that build the infrastructure and services in these states that increase the standard of living. This happened in the 1930's and 1940's under FDR and Truman, in the 1950's under Eisenhower, in the 1960's under Kennedy/LBJ. And is happening again under Biden today. Lets not forget that president John F. Kennedy says in his speeches that these regions in America in the 1860's under Lincoln were in development close to what prevailed in the 1960's in India, Ceylon, Chile, Turkey or China. The Biden pledge not to increase taxes on anyone making less than $400,000 is significant because it grasps the situation in America where extraordinary gains in wealth since 1980 have gone only some of it to the top 1-2% in midwestern states and southern states, and most of it to the top 3-5% in coastal states population in the east and west, New York and California, where the finance and tech industry are based. In Michigan and Wisconsin only 2% of households make more than $400,000, in Pennsylvania, Nevada, Arizona and Florida 3%. WSJ shows a map of the US showing this for individual states. The core southern states have 2% of households with incomes over $400,000- including Arkansas, Tennessee, South Carolina, Alabama, Louisiana, Oklahoma, with Mississippi less than 1%. It is only segregation in the late 1960's and culture issues such as abortion that have turned them from Democratic states to Republican states as they were the largest beneficiaries of taxes diverted into investment in these places since FDR/Truman and John Kennedy/LBJ. It was JFK who came up with the phrase "a rising tide lifts all boats" when he opened federally funded projects in Arkansas. Seen objectively the large investments made under Lincoln, FDR/Truman, Kennedy/LBJ from tax revenues are what changed this region from conditions that prevailed in less developed countries that John Kennedy points out in his speeches, true for the midwest, parts of the west, and the southern states alike.  President Kennedy said on Feb. 25, 1963 to the American Bankers Association Symposium on Economic Growth: "Today, many Americans tend to think of developing underdeveloped countries in terms only of faraway nations. But in 1863, even measured by 1963 dollars, our own per capita income--and this should be a source of encouragement to many who are laboring with the problem of underdevelopment in far-off countries--our own per capita income was less than $1 a day, approximately the same as Chile's. Nearly 60 percent of our labor force was engaged in agriculture, the same percentage as is today engaged in the Philippines. An estimated 20 percent of our population was illiterate, the same percentage of the population of Ceylon. Only one-fifth of our 34 million people lived in towns or cities of over 5,000 in population, as is roughly true now of Turkey. In 1863, this Nation had fewer railroad tracks laid than India has today, and its children had a shorter life expectancy than a child born this year in Thailand or Zanzibar."   ...

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China's premier, Wen Jiabao, opened the National People's Congress, annual meeting of the Chinese parliament, by saying that China had lowered its growth rate to 7.5% from 8%. GDP growth for 2011 was 9.2%. Wen set an inflation target of 4%. The CPI index increased by 5.4% in 2011. Wen set 14% growth target for M2, China's broadest measure of money supply.

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The head of the Chinese Communist Party's rural policy office, Chen Xiwen, says about 20 million migrant workers or one sixth of a total of about 120 million migrant workers have lost their jobs in the 2008 global financial crisis. About 5-7 million migrants join the workforce each year, and this brings the total to about 25 million migrant workers looking for jobs. This presents a major problem in job losses for China. The government is making every effort to ease the problems of migrants, to retain jobs, talk to migrants to explain the situation, and provide asistance. Ian Johnson and Andrew Batson of the WSJ visit the village of Shuangyao in rural China and talk to migrants there.

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This article clearly shows that Russia is turning the corner for full scale use of western technology to tap oil and gas fields in the North. Note the efforts to bring in western expertise include- 1. Efforts to hire Donald Evans, former U.S. Commerce Secretary, to be Chairman of Rosneft. Evans turned down the offer. The hiring of Peter O'Brien a former Morgan Stanley investment banker as chief financial advser.2. With China National Petroleum as a strategic partner. 2. The financial backing and expertise of state run oil companies around the world now give them the ability to contract directly with Schlumberger or Baker Hughes or other oil field technology suppliers. This changes the whole playing field with less need to negotiate with the major oil companies and the ability to do it themselves at their own pace and strategic advantage and execute their own oil policy. Previously negotiating with the oil companies meant giving up some of the ownership of the oil fields to the oil companies in return for the technology. The oil services companies sell the technologies on a fee basis. 3. The pressure to move ahead aggressively with new technology. Estimates from IEA in Paris by Chief Economist Fatih Birol, show that increasing oil production by one and half million barrels a day to level of ten and half million barrels a a day requires Russia to invest $900 billion dollars by 2030 or about 40 billion a year. The only way to generate this kind of investment is to grow its oil development capabilities, keep prices high but stable, invest in the latest technology and bring some of it inhouse....

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Jens Hansegard interviews IKEA China head, Gillian Drakeford. Drakeford an employee of IKEA since 1988, has run the Chinese operations since 2003. She talks about how IKEA approaches the Chinese market. IKEA's Chinese sales in 2011 fiscal year ending Aug 30, were 4.9 billion RMB, 20% larger than in 2010, with 20% growth seen so far in 2012. Its plans are to open in 2nd tier cities with opening stores in Chongqing, and Wuhan. It has opened stores in Chengdu and Tianjin. The way IKEA opens stores is in partnering with its IKEA Centre Group which owns and manages shopping centres. In Wuxi, Beijing and Wuhan it will open stores with shopping centres of this type. The IKEA customer is 25-35 years in age with relatively higher incomes and education who finds a westernized lifestyle appealing. Space is a constraint, and there is the added factor of more stuff needing to be stored with more products available. A multigenerational family may live on 70-90 square metres. IKEA's challenge is to show how to deal with limited space, keep lowering prices to remain competitive with local competitors who are catching up to new retailing trends of IKEA type stores. Because Chinese middle class means much lower incomes than in the EU, the key is to meet affordability goals, and keep lowering prices for value. IKEA's "Lack" table has come down from 120 yuan to 39 yuan, and since 2000 it has cut prices on average by 60%. IKEA uses China's microblogging site Weibo to reach customers- where it puts up announcements and customers ask for tips, suggestions and put up their own pictures....

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Even though China has one of the largest stimulus programs, it hopes to keep its budget deficit down to 3% in 2009. But this does not correctly reflect the true cost of the stimulus program, as much of that cost is taken on at the local government level. Of the stimulus two year $585 billion investment program only one fourth is reflected in China's formal budget. Stimulus projects get quick approval and a partial financial contribution from Beijing with the local governments having to come up with the biggest share of the funds. As China's tax system channels most revenues to Beijing, the local governments are seeing an explosion of debt. These are liabilities not on the books but having the indirect support of Beijing. Without this local government debt China's total state debt is closer to 35% of GDP than the 18% shown in official numbers. See graph. And the government budget deficit will be about 4% of GDP in 2009 according to Deutsche Bank economist Jun Ma. Even before the stimulus local government debt was large, at about four trillion yuan, equivalent to 16.5%of GDP, as estimated by the Research Institute for Fisal Science, the think tank of China's finance ministry. In the first quarter new loans by state banks for infrastructure projects to government backed companies was 895 billion yuan, or 22%of the national stimulus package. Local corporate bond issues indirectly backed by the local government, totaled 102 billion yuan for Jan-May 2009. The government hopes that with economic growth and growing tax revenues paying back these debts won't be a big problem. ...