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Samsung's plan to open "Experience Shop," in 1400 Best Buy stores, which sent Best Buy's share up 16% in April 2013. Samsung gains much from this plan, as it allows Samsung to have a friendly retail presence in-store that it badly lacked upto now.

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LinkedIn's IPO is offered at a price of $45. This is up from estimates of $10 a week before the IPO. The career networking site opened at $83 and in a few hours zoomed to $122, before closing at $94.

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The different strategies of Apple and Samsung in getting to the point where the two companies now dominate the smartphone market. Whereas Apple makes only one phone, its iPhone, Samsung's strategy is to have multiple phones in each price segment. It has five levels of Android based phones, with 2-3 models in each price segment. Samsung also benefits from doing its own maufacturing. When faced with a number of technologies Samsung's strategy is to bet on all of the technologies until one of them emerges as a winner, and then concentrate resources on that technology. It uses a similiar strategy for televisions. Apple by contrast places more emphasis on original design and profit margins over sales, gaining sales without eroding margins by being the first innovator in the market. It also has its own unique arrangement for manufacturing at lowcost with Foxconn in China that supports its high margins. Apple is secretive about its designs and promotes its brand heavily with its own retail stores. Apple also uses its innovative edge as leverage to steer profits away from carriers. Analyst estimates are that carriers such as AT&T and Verizon pay about $400 per iPhone to subsidize its cost because this is the only way to get customers into their retail stores. IDC estimates are that the smartphone market is $219 billon in 2012. Both companies are very close in volume- IDC estimates Apple shipped 93.2 million smartphones in 2011, compared to Samsung's 94 million units. Apple has market share of 23.5% in the fourth quarter 2012, up from 16% in 2010. Samsung has 22.8%, up from 9.4% in 2010. Apple and Samsung have together taken 91% of operating profits of all cellphone companies in the fourth quarter, an increase of 30% from 2011, according to Strategy Analytics....

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With 40% of the unemployment shown as longterm unemployed, U.S. Federal Reserve policies are focussed on bringing down these levels, which pose a risk to the productive capacity in the U.S.

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Close to half of the respondents in the 2010 Annual Survey of the American Chamber of Commerce in Shanghai, say that they face regulators who show a preference for domestic companies. About 80% of respondents said their operations were profitable in 2010. In 1999, 58% of Shanghai members of the chamber said their profit margins were below worldwide levels. In 2010, 78% said their profit margins matched world levels. Just under half of the respondents said they feared a negative impact from China's effort to build "indigenous innovation" and encourage domestic champions in each industry. 63.1% of respondents say regulations are getting worse or staying the same. Chinese President Hu on a state visit to the US in January 2011 is presenting the idea of a level playing field for American companies.

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Jan Hatzius, economist at Goldman Sachs, says the May 2012 jobs report of only 69,000 jobs added, and 49,000 fewer jobs added in March and April after revisions by the Labor Department, should be seen in the light of higher hiring in the winter months because of warm weather. His estimate is that the warm weather added 100,000 extra jobs in the 3 months through February 2012, taking jobs from the March to May 2012 period which averaged 96,000 jobs per month. The underlying job growth if these weather related effects are taken out would be 120,000 to 130,000 jobs added each month in the March through May 2012 period. Macroeconomic Advisors draws the same conclusions, and adds that reductions in energy prices should offset any negative effects of slower job growth by boosting real disposable personal income and supporting real consumer spending.

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A study by Bank of Japan's Research and Statistics Department in the Feb. 2013 Bank of Japan Review paper titled "About the Real Effective Exchange Rate," shows how Japan maintained international price competitiveness during the period of the strong yen at 80 to the dollar. It found that with deflation the cost inputs of labor, factory equipment and materials in Japan were reduced, even as the price in overseas markets for finished products went up. It found that while the yen went up against the dollar in nominal terms, in price adjusted terms accounting for deflation it has actually fallen. Nomura economist Kiuchi says the Japanese yen had to go to 54 to the dollar before it matched the level of the 1995 priceadjusted high of 79 to the dollar.

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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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Roubini sees hard landing and recession lasting at least for 2008. Bergsten sees companies like IBM, Caterpillar and GE and others helping moderate the downturn because of demand from China and India which he calls reverse coupling. Yu sees China entering a delicate stage, India helped by domestic demand.

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Russian president Putin tells Russians at an annual news conference on Dec. 17, 2014, that the West wanted to deprive Russia of its natural resources. He says steps taken by the central bank and his administration were proper, including avoiding capital controls, except that the decision to raise interest rates to 17% in mid-Dec. should have been taken earlier. He deflects criticism that the sanctions and the decline in the ruble were "payment for Crimea" (Russia's takeover of the Crimea) by saying it was "payment for our independence, our sovereignty." Putin expressed unease with the expansion of NATO to Russia's borders. He told Russians to expect that the crisis will last for 2 years and during this time the Russian economy will adapt, in particular shifting its heavy dependence on oil exports. During the 10 years of the Putin administration since 2004, Russia has not made a vigorous effort to diversify away from oil dependence. Progress was made primarily in better integrating the economy with the European Union, entry into WTO, building a sovereign reserves fund, until the crisis in Ukraine. The Putin years may be seen in the future as the transition years towards a more diversified economy, and may lead to a shift away from the kind of management of economic and foreign policy by a single leader that may have led to the disruption in relations with Germany, a critical economic partner for Russia. Chancellor Merkel said Germany would continue to support sanctions as long as Russia opposed the right of self- determination of people in Europe and European values. Germany continues even now to maintain dialogue with Russia through Social Democrat Foreign Minister Steinmeier, which is why Putin continues to refer to it as "our partners" and cites the differences with our partners, very different from the Cold War period when no such close relations with Germany existed. ...

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The yuan has risen 14.5% against the yuan in the last 4 months, according to the Chinese Commerce ministry. Loosening the Chinese currency's peg to the dollar will increase the value of the renminbi even further. And with further declines in the euro expected this would seriously affect Chinese exporters to Europe. This also makes European goods more competitive than American goods in the Chinese market putting the Obama's administration's goal of doubling exports further at risk. The Shanghai stock index declined by 5.1% on Monday May 17, 2010, reflecting these concerns. The Chinese government continues to intervene in currency markets and the renminbi is now at 6.827 renminbi to the dollar.

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Joe Nocera describes his personal situation which also reflects the situation of the average investor in his 401(K) for retirement - inexperience in handling the boom-bust cycles in the market and loss of savings, especially in the last two decades with sharp swings in the market. The Employee Benefit Research Institute statistics on savings of the average American are striking, dismal is the right word- only 22% of workers 55 or older have more than $250,000 set aside for retirement, and 60% have less than $100,000 in a retirement account. The average savings of an American near retirement are $100,000.

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The St. Louis Fed President, James Bullard, argues in a paper, that the keeping of target interest rates near zero as promised by Ben Bernanke at the Federal Reserve, sets up a situation similiar to Japan of a "deflation trap." He said that core annual inflation of only 0.9% in May 2010 suggests that there is a risk that the nominal inerest rate and inflation end up being at an unintended steady state which is dangerously low. He also said that the market's interpretation of the Fed's extended period of low interests language had a perverse effect of stretching out the period before things normalize. He suggests as an appropriate step "quantitative easing"- a policy of buying monetary debt with longer dates. But for this to be effective, the action has to be credible.

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The memo to U.S. president Reagan written by his economic advisors in November 1980 before his first inauguration. Inflation was running at 13% and the economic problems looked as intractable as they do today. Advisors included Milton Friedman and George Shultz. The memo called for setting steady policies for the long run to encourage investment and growth, and at the same time steady monetary policy. This is different from the repeated quantitative easing efforts by the Federal Reserve responding to financial markets, and the Obama administration's stimulus efforts that have not led to long term growth. On the long term perspective the memo said: "The need for a long-term point of view is essential to allow for the time, the coherence, and the predictability so necessary for success." The memo was released by George Shultz.

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An analysis by Credit Suiss analysts shows that borrowers who have their principal reduced are less likely to default. But mortgage companies have been reluctant to take down loan balances. One study shows that47% of loan modifications completed in November 2009 resulted in higher payments for borrowers, typically because unpaid interest and fees were added to the loan balance. It is critical to make loan payments significantly affordable, as many people have other loans such as credit car loans, home equity loans, car loans, and these obligations make even a lower payment unaffordable.

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Will the long awaited Obama plan do enough to reduce foreclosures and help the economy? $75 billion will go to help homeowners facing foreclosure. But it continues the earlier course of letting it be voluntary for banks and lending institutions to decide if they in fact want to reduce the mortgage payment to 38% of the borrower's income. If they do the government provides an incentive of $1000 for every loan modified, and more payments if the borrower stays current. If the lender decides that its not in its interest to make concesssions to reduce the payments to 38% of the borrower's income, in exchange for the $1000 incentive, it could well decide to do nothing, and even continue the current practice of adding on interest and penalties that actually increase the mortgage payment in many cases. Is it enough? Clearly no, if Mark Zandl, chief economist at Moody's Economy.com is right, and helps only 1 million of the estimated 14 million people who are under water, and the homes are worth much less than the outstanding mortgage. As Martin Feldstein has pointed out for the last year since early 2008, its these people who are under water that need to be helped, and not in a piecemeal or voluntary way as Obama is suggesting. It only goes to show that after all the rhetoric, Government both Republican and Democratic, differ only in degrees in the way they are responding to the foreclosure crisis, that is at the root of the financial crisis. The tidal wave of foreclosures, the other 13 million borrowers that are not helped by this plan but are under water, with growing numbers because of growing layoffs, suggest a serious failure to tackle the problem, with serious consequences for 2009 and beyond....

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The graph tell the story, in early 2007 there were close to 4 million homes under water, in early 2008 closer to 8 million homes and in early 2009 closer to 16 million homes under water, close to doubling the number of homes under water. This is why more of the morgage securities become bad assets with each passing year, as their underlying assets the mortgages become high risk for default. During the third quarter the number of homeowners under water, or owing more than their homes were worth, were 11.8 million, and by the end of 2008, 13.6 million, according to Moody's Economy.com They are growing at close to 1.8 million every quarter, or at the rate of over 7 million a year. Which at this rate would reach 21 million homes under water by early 2010, if one assumed that government help only worked to offset the impact of further deterioration of housing prices, by lowering payments for some homeowners. A new housing rescue plan was announced March 4, 2009. This will supplement the $75 billion announced earlier. This plan announced March 4, 2009, is expected by the Obama administration to cover 9 million homeowners. Borrowers who face severe financial hardship that may cause them to lose their homes, are required under this plan to sign affidavits attesting to this. They will in then see their loans modified, payment periods lengthened, and interest rates dropped to as low as 2%, to bring the monthly payment down to 31% of income, the number that experts say is appropriate for sustainable payments. Only first lien mortgages, and homeowners who live in these homes and not homeowners who use them as investments, will qualify. The outstanding principal balance cannot be over $729,750. As incentives loan-servicing companies will get upto $3500 from the government, and the government will also match a portion of the ender's costs dollar for dollar. Homeowners get $5000 in government money to reduce their outstanding balances, as an incentive to them to stay current on these modified mortgages. The administration plans to announce plans to those holding second mortgages on their homes, who have difficulty modifying them. The other component of the plan is for Fannie Mae and Freddie Mac to refinance loans for borrowers who are under water, owing more than their homes are worth, even if they are wealthy enough to afford current payments. There is no income ceiling for this part of the plan. And these mortgages have to be held or guaranteed by Fannie Mae or Freddie Mac, with homeowners not owing more than 105% of the current value of their homes. ...

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On October 30, Sheila Bair heading the FDIC, the main advocate for reducing foreclosures by reducing the mortgage payments is in discussions with Treasury officials for a plan whose details are still being worked out. A key part of it is for the government to assume half of the losses on home loans that are incurred if mortgage companies agree to lower monthly payments for at least 5 years. The cost to the government is about $50 billion that would come from the $700 billion bailout fund. Right now loan companies are reluctant to reduce monthly payments because homeowners might defaul again or the owners of mortgage securities might file law suits. The funds would go to shoulder half of any future losses on default. For example if under a loan modification program 40% redefault and losses on loans are 55%, and $500 billion in loans are modified under the program, the total losses government would bear are $55 billion. This scenario is possible in a deep and prolonged housing and economic slump. This would be a gradual program if mortgage companies or companies with home loans or servicers of loans have to decide if they want to take advantage of this program, and time is critical as the foreclosures are accelerating and thisputs downward pressure on prices....

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It took a long time for the banks to understand what is in their best interests is in the best interests of the country's economy and homeowners, something Sheila Bair has been saying since the beginning of this year and implementing at IndyMac. Its just too costly for banks to use the foreclosure process to recover their money and it makes much better financial sense on the bottomline of banks and for the economy to make home payments affordable. Because the worse home prices get the worse the economy and banks do and nothing drives home prices down like foreclosures. The Bank of America settlement for Countrywide with state attorney generals to modify loans for 400,000 homeowners because of predatory lending practices also set the direction. Chase Bank is now using the Bair template to get the monthly payments down to an affordable level which is about 40% of the current payment by reducing interest rates and using a smaller loan balance and keep homeowners in their homes. Chase's plan will help 400,000 homeowners and will also help homeowners who are having difficulty making payments. It will put a 90 day hold on foreclosures till the program is put in place. Yet there is one problem. Only $350 billion of the 1.5 trillion in home mortgage it services are owned by Chase, the rest are owned by investors in the form of mortgage securities. It can do little for homeowners covered by these securites that are owned by hedge funds and other funds as a few of these funds oblivious of the overall interest including their own have threated to sue if loans are modified, and it would take some time to figure out who owns each security and what the terms are for modifying loans for that security. Its this part of mortgage securitiization that has slowed down a rational process of unwinding this problem throughout housing by making homeowners monthly payments affordable. And Fed's Bernanke did not come to grips with this point in his talk about mortgage securitization to UC Berkeley on October 31,2008, that mortgage securitization done in a way that make loan modification difficult is dangerous as it is today, and makes a crisis bigger than it otherwise would be, and turn a USA crisis into a global crisis through ricotcheting effects and a series of bad decisons....

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Interview with Dieter Zetsche, Daimler's CEO on what Mercedes is doing. Daimler is introducing the Smart car in the US in a big way. Its just 8 feet long and gets 40 miles per gallon. Demand for it from dealers was so strong that instead of 40 dealers as planned Mercedes has setup 67 dealers in 31 states in the USA. About 3500 were sold in the first 3 months, Feb to April 2008. Its Bluetec program is another way its boosting fuel efficiency. The Bluetec program is for making diesel engines as clean as gasoline engines and gasoline engines as efficient as diesel engines. Its the second generation of direct injection systems and both engines will work with self ignition. And Daimler is on the path of combining these engines with hybrids. And also develping fuel cell and all electric battery driven vehicles emission free. As Zetsche says Daimler is moving along this path very fast. In lithium ion battery in cars Daimler is taking the lead. He says the American and Japanese makers are pushing hard but Mercedes is ahead by taking the car to market that has a lithium ion battery. How does Daimler do it? It has about 24 patents. The main reason no carmaker has made it to market with lithium ion battery for cars is the cooling problem that has been seen in laptops also. Mercedes solution to this has been to integrate the cooling of the battery into the cooling system of the car with a sophisticated system, hence the many patents. Next year Dailmer will introduce the S-Class with a six cylinder gasoline engine, the S400 Hybrid with a lithium ion battery, and it will be the first in market. Dieter Zetsche is so confident that he says it will have perfect performance and absolute safety. With targets for fuel efficiency in Europe more aggressive than in the USA, and the German public pushing for higher fuel efficiency aggressive emissions targets and intolerant of excuses from German carmakers, makers like Daimler are moving very fast in this direction. Adding to pressures from the German public, they see oil prices at current levels for the foreseeable future, this adds to the urgency. Americans and Japanese makers stand the risk of falling behind. See the links to the pressure from German public opinion and the German carmakers response to this. And clearly Zetsche reflects that confidence in this interview. Daimler's Mercedes division is selling a lot of cars in China, Russia, and the Middle East. As he put it there are 400,000 millionaires in China and Mercedes are sellig very well in these markets just as the US market shrinks. And these are cars in the dollar 40,000 plus or $100,000 plus range in which Mercedes has he lead. This market will also shrink as the global economy slowsdown but the profits from this market will probably be plowed into the Bluetec and other advanced fuel efficiency programs that will give Daimler a market advantage in the longer run....