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Serious questions about the future of the car industry and investment in fuel efficient cars as a long term viable alternative, regardless of the specific price at the pump that reflects changing economic weakness in a global economy. Decisions that Obama will have to make in steering the auto industry in a new direction. Management and culture at the car companies remains as ever a big issue and this also will come up because fuel efficiency and making money on small cars and building the cars that the public wants and would pay good prices for, are a result of the resolve, skill and perseverance of management. The only thing that one can say for current management at GM and Chrysler is that it is entrenched and with the same culture that does things the way they have always been. It also lacks the vision and skills to make the changes to get Americans to buy more cars and small cars at prices where they are profitable to car companies. As it reminds us here for all the talk about fuel efficiency and cars, light trucks madeup 58% of GM's sales through November, 64% for Ford, and 72% for Chrysler. The market is bad for all car companies including Toyota and Honda, but things are much worse for the Big Three because of the way in which their sales are way skewed in the direction of SUV's and light trucks and the absence of winning models in the medium and small car segment that command good prices....

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Hubbard at Columbia, Scott at Harvard, and Zingales at University of Chicago, go over the options. Bad bank option has the drawback that you have assets that are written down and you put them in a bad bank, but what about all those assets that deteriorate as the economy deteriorates, would'nt they have to be be put in the bad bank too? Banks hold $6 trillion of mortgages and mortgage securities, with mortgage securities of $1.3 trillion. Option two, guaranteeing bad assets has been tried for Citigroup, where taking asset pool of $306 billion which was created, Citigroup absorbed the first $29 billion losses, Treasury and FDIC jointly fund next $15 billion, and Fed holds 90% of remaining losses. The government getting $7 billion in preferred stock with 8% yield. This Citigroup option according to a conservative estimate would cost the government $60 billion after stock warrants received. This would cost for all the banks something like the $700 billion of the TARP, and if bad assets deteriorate further as is likely, could end up costing the government trillions. So this isnt a great option. Hubbard, Scott, and Zogales, say that the option of encouraging banks to spin off toxic assets into separate affiliated bad banks would be a reasonable one. But the government should't guarantee the assets of that bad bank if it poses systemic risk. And banks with negative capital or close to negative capital should be taken over by the government, nationalized, through already established FDIC procedures, such as bridge loans. ...

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Frank Rich of the NYT thinks Obama's problem is not the GOP which is losing public support very quickly as the CBS/New York TImes poll shows, or the mortgage rescue plan and the shaping of new priorities in his address to the joint session of Congress which have increased in popularity for a people nervous about the economy, but the increasing unpopularity of the banks and financial institutions. His plan for financial institutions lacks the clarity and direction of his other efforts, says Rich. And Geithner who was protegeof the old boys Greenspan, Rubin and Summers who got the country into this disaster, is not the man who can convince the people. Therein lies the President's problem. He has chosen these people to come up with the solution to the banking crisis, and he has to sell this hugely unpopular solution with his advisors too timid and too complicit in the origins of this problem, that they have not been able to craft an effective plan. And the people who run these banking institutions are still running these institutions, and the people who run these auto companies are still running these auto companies, something that is hugely unpopular with the people as the CBS/New York Times poll shows. Only a new management, a new board, and a fresh clean beginning, and a convincing plan, would convince the people that another big bailout of $750 billion in banking "asset purchases" on top of the previous $700 billion bailout is going to work....

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To keep prices from taking a nosedive if there is a slowdown, as for example in the Chinese economy, a concentration of resources within 3 or 4 mining companies enable them to slow down development of new deposits to adjust supply with demand. In this case even if China slows, India, Russia and Brazil may still pick up, as they may be less sensitve to the U.S. consumer than China. China is a manufacturing export based economy compared to India and Russia, which are more dependent on internal demand. Iron ore prices have increased by three times since 2003, and China's imports of iron ore have gone up from 29% to half of the world's imports. Prices of all commodities copper, alumina, uranium have shot up. BHP and Rio both based in Melbourne, Australia have absorbed all the medium size companies in the Melbourne mining scene. Australia has traditionally been a leader in this field because of its huge mining resources. Other reasons for consolidation are the more complex technologies needed to develop the remaining deposit finds, which are fewer and fewer and of lesser quality. Another factor is that the resource nationalism in India, Bolivia, Indonesia, Mongolia and other places requires more sophisticated investors. Combining Rio and BHP also means BHP can use the better infrastructure of Rio and invest more productively in future infrastructure rail lines and port development to speed exports to other countries. See the Barta article in the WSJ Link on this on Dec 18, 2007. ...

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Sheila Bair gets credit for anticipating the banking crisis and gets credit from people in the Bush Administration like Robert Steel Undersecretary at Treasury till recently for a comprehensive approach to the banking and credit and mortgage crisis. Steel says that the Bush administration first relied on a case by case approach and only later came around to Sheila Bair's comprehensive approach which also underpins the recent legislation passed by Congress to tackle the mortgage crisis. She has advocated better terms for borrowers as the best approach for lenders and borrowers and the banks and for the economy which has not been favored by the banking industry and lenders aseach group followed its own vested interest seeing only the immediate short run and failing to grasp the full extent of the crisis. Sheila Bair has taught public policy at the University of Massachusetts at Amherst and also worked for the Bush administration at Treasury and in other capacities till her appointment to lead the FDIC. She also oversees the IndyMac bank as the FDIC took over that failed bank recently. She has over 100 banks at risk on her watch list and sees more fialures of banks ahead and the worst of the credit crisis still ahead of us when she says in this interview that " we have not seen the trough of the credit cycle yet", and referring to the hard headed work with a lot of work and not enough staff of examiners that " its going to be a slog to work through this."...

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A couple of things have taken Obama ahead given he is a candidate who the electorate is not so familiar with and his relative lack of experience, and they relate to McCain as candidate and Obama as candidate. McCain comes across as impulsive and casual, Obama has more composure and steadiness and is thorough. In the selection of candidate Obama filled in for experience, and McCain's selection handicapped his experience argument. McCain campaign's higher taxes from Obama argument is also blunted by his poorly thought out plan to tax health insurance benefits, which neutralized his claims of higher taxes from Demmocrats. And Obama's grassroots organization and fundraising maakes it possible to run a stronger better campaign and his focus has been consistent and steady on the economy, all of which add up to another advantage. And all this is happening against the background of 8 years of Republicans and unpopularity of Bush. To that is added the sudden deterioration of the economy in September 2008 and a global financial crisis, in which McCain's impulsiveness in going to Washington which led to Republicans voting down the first bailout plan in the House was set against steadiness of Obama on these economic issues, with advice from an experienced man like Paul Volcker, former Fed chairman. The worst hit economically are midwest states where the auto industry is near collapse needing its own bailout, and this has led to an astonishing lead in some polls of 25 points for Obama, quite unheard of for a fresh candidate....

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Mr. Vanderhei of Politico leaves to form a rival political coverage site called Axios, which has funding from Comcast Universal. The result of a rift between Mr Albritton, the owner, and the CEO, Mr. Vanderhei, is that many executives are now leaving Politico, putting it into a crisis. 

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Mongolia and the Democrtatic Republic of the congo are a few of the places where minig deposits have remained largely intact. Now the rush by companies like Rio Tinto to mine in Mongolia is creating problems with corruption and afffecting democratic life in Mongolia. There have been frequent protests about environmental degradation and corruption from mining. Mongolia a nation of 3 million people is largely agrarian but rich in copper, coal and other commodities.

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GM's cost cutting side may help it reach profitability but its revenue side is weak as it has lower margins on the cars and fuel efficient vehicles that are selling today. Will it continue to lose market share? Recently its stock price has been going up but curves lie ahead because the declining housing market means sales may be sluggish and there is fierce competition from the Japanese and Koreans and from its US rivals.

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The name change from Matsushita to Panasonic will help the company promote its brand in sales overseas especially in the developing countries. Matsushita was founded around 1917 by Konosuke Matsushita to make a device to be used for light bulbs. Matsushita will start making flat panel TV's at a new factory in 2009. Its sales have been sluggish so far hence the need to promote one brand name worldwide similiar to the Sony brand name.

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Semple, Ahmed and Lipton provide this NYT story on Mossack Fonseca, the secretive Panamanian law firm that set up offshore tax havens for wealthy individuals around the world, the focus of the investigation called the Panama Papers Scandal. It provides an account of the history of Mr. Mossack, whose father was in the Nazi Waffen SS, and immigrated to Panama with his family after 1948. His partner is the Panamanian novelist, and advisor to the Varela government in Panama, Mr. Fonseca.

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U.S. Secretary of State Kerry visits Hiroshima in April 2016, with all the foreign ministers of the G-7, following a G-7 foreign ministers meeting in Japan.

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A new Pew Research Center Survey shows prime minister Modi enjoying 88% popularity, very high ratings for a world leader. More unusual is that Modi's popularity was 87% in a Pew Survey in 2015, showing extraordinary resilience. This comes after moves to remove the large denomination rupee notes under what is called demonetization to take out some of the black money in India and increase tax revenues that were lost due to evasion. In South Asia tax evasion is rampant, much more than in countries like Italy of the eurozone. The move was difficult as it required being sudden, and a shift to use of debit cards and ATM's which required additional effort, slowing the economy. The other moves such as on GST tax were designed to facilitate doing business in India with one tax and free movement of goods replacing different state by state taxes. Business has not responded quickly to support Modi, and the Indian economy being prepared for the long term growth Modi hopes to generate is slowing in the short term. GDP growth has dropped to 6%. A bullet train planned in western India with help from Japanese financing and technology is being criticized unfairly because of the collapse of an old bridge near a railway station in Mumbai. Bruce Stokes, Director of Global Economic Attitudes at Pew Research, says the survey was done after demonetization but before the GST tax overhaul. This is not likely to change Modi's high ratings. The GST overhaul has been on the agenda for many years for all political parties in India. The views of Modi are not necessarily the same as for his BJP party which are lower for the party, the party gaining more from Modi's efforts and leadership, including in his home state of Gujarat. ...

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Marina Force of the WSJ gives this excellent report on Carles Puidgdemont, head of the Catalan party that is holding a referendum for independence from Spain in October 2017. The referendum is to be held on Oct. 1, 2017, and will be held in a tense region divided by pro and anti independence supporters, with the central government of Spain declaring the referendum illegal, and police obstructing voters. This has pushed Spain into a major crisis, as Puigdemont says he will declare independence after the vote, and the possibility that many voters may not have voted at all in this tense atmosphere. Here Marina describes the recent history of Spain that dates back to the period under General Franco's dictatorship when state rights in the Basque region, in Catalan region and in the northern region in Galicia, as well as other regions, were suppressed. Today there is regional autonomy and the languages in the regions such as Catalan are used in the autonomous regions. Prime minister Rajoy is from the Galicia region. His family suffered under Franco's dictatorship as he points out in his book- Mariano Rajoy, En confianza, Mi vida y mi proyecto de cambio para Espana. As a result Catalan leader Arturo Mas and other Spanish leaders including Rajoy from Galicia worked hard to establish autonomy for all the regions in Spain, including use of the local language in Valencia, Catalonia and the Basque region, a variation of Spanish. As in Scotland for most of the period after the end of the Franco dictatorship in the nineties, this focus on regional autonomy was seen as a big step forward. Puigdemont is journalist who was editor in chief of a Catalan newspaper in the 1980's. In 2006 he was elected to the Catalan parliament. In 2013 he was elected mayor of Girona, a city just north of Barcelona. It was in this period that the movement for Catalan independence moved forward setting the stage for the 2014 referendum with 81% voting for independence. In 2016 pro-independence parties won a majority in the Catalan parliament. This set the stage for a confrontation with the central government in Madrid that is now taking place. ...

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Mismanagement of the rail network and lax oversight by the Greek government leads to a train disaster.Trains on Athens Thessaloniki route are on manual mode signalling. This leads to the collision of a freight train with a passenger train which was mistakenly put on the same rail line by a station master. Many of the 342 train passengers were students returning home. Automatic signalling has not been installed in Greece for Athens to Thessaloniki even though equipment was brought in for the 2004 Olympics, and concerns were raised with the government about the risks, say trade unionists in this report in The Times.

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This editorial in the WSJ describes the prolific effort to collect donations for the Clinton Foundation that it says promotes crony politics and lobbying. It says that this happened after some of the ethical questions raised during Clinton's two terms as president. This has been a particular problem for Hillary Clinton during the primaries, something she could do without as she has a 40 year record of public service and exceptional work in support of children in the U.S.. And specific programs for infrastructure and other areas to strengthen the U.S. in which much needs to be done in the future. 

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Promises made by China when it entered the World Trade Organization to open its markets in telecommunications, banking and other fields have not been kept. 

Seventeen years later the U.S. sees China as intent on gaining competitive advantages through joining the World Trade Organization. During that period successive Republican and Democratic administrations did not take action to make China comply with its obligations under the WTO agreement. The broken promises and how to have an agreement that has protections that ensure that each side lives up to the spirit and letter of the agreement, is a key challenge for Mr. Lighthizer and his negotiating team.

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500 million tons of plastics are produced today compared to 250 million tons in 2004. Califonria sued Exxon Mobil in Sept 2024 for overhyping the promise of recycling. In reality says NYT's Hiroko Tabuchi only some of it gets recycled- an astounding low rate of 30% getting recycled- and the rest 70% of 500 million tons or 350 million tons ending up incinerated or in landfills or ending up in the environment on coastlines. The NAPCOR is association for PET resources, PET standing for single use plastic the kind you have in water or soda bottles. It is presenting the promise of recycling and the importance of these bottles for hydrating, without stating that there are alternatives.  All the time this is going on the threat to public health for the people, for us all, gets larger. Note that even developing nations such as India have the prime minister himself take up the campaign against microplastics, plastics bags and bottles, as Mr. Narendra Modi has done in India. A conference in Busan South Korea is discussing a global plastics treaty to end this plastics threat to health and the land we live in. It shows how regulation is needed in a capital-ist economy because companies and jobs at companies of 70 plastics and recycling companies are at stake and so is the public health, our health and our land, its coastlines and waters. ...

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Did U.S. Treaury Secretary, Timothy Geithner, ignore a key request by President Obama to present plans for the restructuring of Citigroup after the government bailout of Citigroup? Ron Suskind says this is what happened in his book on the Obama administration and how the White House operated to make key decisions. Ron Suskind, intervewed key members of the Obama White House economic policy team, Lawrence Summers, Christina Romer, Peter Orszag. In all Suskind conducted 700 hours of interviews for his new book in Sept 2011: "Confidence Men: Wall Street, Washington and the Education of a President." According to the book, in early 2009 after Obama authorized a series of stress tests for banks he told Geithner to develop a plan for restructuring Citigroup. A month later at a meeting not attended by Geithner Obama raised a question about the status of the plan. He was told by Romer that no restructuring plan had been developed for Citi. Suskind says Geithner disagreed about a plan to restructure Citi and decided to ignore the request. Geithner and the Treasury Department say Obama asked Geithner to develop a backup plan to overhaul banks if the government was forced to keep a big ownership stake in the companies, and "there was fortunately never a need to put them in place." Geithner told Suskind that he doesn't slow-walk the President on any matter. Other aspects of the operation of the economic policy team that Suskind covers are a series of memos from top aide Pete Rouse raising questions that ongoing communication between some members of the economic team and Summers was giving Summers power to shape policy. Summers, Director of the National Economic Council, is shown as trying to keep out the views of Romer and budget director Orszag from reaching the President without going through him. When Orszag gives a private report to the president on the deficit, Summers objects saying that this was immoral. Obama lacked the fresh ideas needed to tackle the problems created by the mortgage and banking crisis of 2008, when he used the Clinton administration economic policy team of the 1990's- Rubin, Bernanke, Summers and Geithner. Fresh approaches were needed two decades after Clinton's election in 1992, and the Bush administration that followed, as many of the problems developed during this period. The similiar embedded thinking was shared during the Clinton and Bush administrations and the economic advisors about dealings with the banking sector, but the situation for deficits, unemployment, housing, and the economy had completely changed requiring fresh approaches. ...

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By financing nurses for financially strapped doctor's offices are pharmaceutical companies promoting their own company's pills. These programs are called disease management programs and are used frequently in Europe. Examples given here are for the UK. After Merck's temporary suspension from this program because of promoting its own drug Cozaar in the UK, there has been some publicity and awareness has increased about the improperness of letting pharmaceutical companies use the program for pushing their pills.

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S&P drops France's credit rating one notch from its AAA credit rating on Jan. 13, 2011. Italy, Spain and Portugal were also downgraded.