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Barry Posen, Director of M.I.T.'s Security Studies Program looks at U.S. options as it confronts North Korea over missile tests. He says a conventional attack with bombers could invite a conventional attack from North Korea. A nuclear attack by the U.S. is seen only in the context of an impending attack from North Korea. Very little warning would be given to South Korea resulting in large casualties, says Posen.

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Americans loaded up with debt may be turning to older thriftier ways of an earlier generation. This this will affect consumer spending, have an impact on Chinese exports, and on the Japanese economy which is dependent on China for growth. Some argue that there is a culture of consumer spending that runs through recent American history. Even after one boom was over the stock boom was replaced by a housing boom, each boom and easy credit offering free spending and borrowing lifestyles. Is it going to change now? But it could be that a point has been reached where the finances of households and of the nation's credit system can only go so far, and culture won't matter if banks tighten up credit. There is a limit for the Fed to act to lower rates, and household debt has reached highly serious proportions. The savings rate went from one tenth of income in 1984, to 5% in 1994, to slightly negative in 2008. Today for those who borrowed against their homes in 2003-2007, 34 million households or one third of the US households, savings rate was negative 13% in 2006 June. Thhis came down to 7% in end of 2007, according to Moody's Economy.com, which suggests that the cutback in consumer spending from this group of people had already begun. What will this mean for consumer spending in the USA? It means that even though the top fifth of American earners who generate half of all consumer spending according to Barclay's Capital, will continue spending though a bit more carefully than before. The rest of the American people will be cutting back, especially the one third of the nation that is heavily in debt, and the unemployed if job numbers aren't that good. Which could be why Goldman Sachs predicts that Japan is already in recession using the Japanese definintion of decline in output, and China may be slowing down more significantly than is understood because of the poor data that is coming out of China. The Chinese economic activity too chaotic to accurately measure, and with large time lags before what is actually happening is detected and quantified correctly. ...

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As expected Iran boycotts the talks in Doha of 16 major oil producers seeking to stabilize oil prices. Saudi Arabia, Russia, Qatar and Venezuela sought to stabilize oil production at January levels to support oil prices. Wth the Saudia and Russia producing all out, Iran seeks to do the same, effectively closing the door on any agreement to freeze production levels.

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PM Modi's win in Maharashtra, India's second largest state, and commercial center Mumbai with Ahmedabad, puts Vikshit Bharat plan to modernize India like China and Japan, on a firm footing. Some observers such as this one were of the view that the Chief Minister during Covid had done a good job, and that splitting his party with defections was not the right thing to do. Yet this view does not look at the infrastructure needs of the state and the nation which require effective government and government that can concentrate on delivery. It overlooks India's need to do what China and Japan have done to modernize their country in the last century. Vikshit Bharat is real, it is within reach, and Maharashtra senses this like the rest of the Indian nation. It is similar to Bumrah like Modi telling the Indian team that it had prepared well, now one should trust the process- which leads to Vikshit Bharat modernizing the nation - and give one's best. This led to Jasprit Bumrah taking the Indian team to a 297 run win over Australia at Perth after losing 3 Tests in New Zealand. A 14% vote margin for the NDA alliance called Mahayuti that is PM Modi's effort in Maharashtra, one of India's largest states which includes the city of Mumbai. This report says waves such as 2019 or ones in which Rajiv Gandhi won in 1985 were felt on the ground. This one was not anticipated. Yadav says in just 5 months after PM Modi's party lost in the Maharashtra Lok Sabha elections by 1-2% the shift is 15-16%. He says there is an additional 5 % deficit when a party contests a state election after a national election, widening the vote margin to 20 percent.  Of this he says the welfare schemes for women account for only 2-3%. The rest he can't understand.     ...

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Providing an insight for the auto industry and other industries, Nokia has managed its own downturn from a few years ago. Nokia has taken a strong position in emerging markets without letting profit margins sink and keeping the average price of a Nokia cellphone from dropping much. See the groups and links to Motorola's situation. Continued dominance in India and China helped Nokia achieve mobile phone shipments growth of 27%in 2007 over 2006 to reach 133.5 million units. Nokia is also gaining market share increasing it to 40% in the 4th quarter 2007 from 39% in the 3rd quarter. And Nokia is now poised to gain back the market share it lost in the USA in the last few years. It sees the market for mobile phones growing by 10% a year wordwide with strong growth in Asia balancing slower growth in developed countries. Nokia follows the average selling price of mobile phones which suggest the direction the market is taking in price and higher end lower end sales distribution, especially at a time when Nokia competes in price sensitive Asian markets with higher lower end sales distribution. Here the average selling price of Nokia phones dropped from euro 89 in the fourth quarter 2006 to euro 83 in 4th quarter 2007. Nokia is careful to keep introducing new feature laden phones that customers want to keep this average price up. In the 4th quarter 2007 the average price was up from euro 82 in the 3rd quarter to euro 83. Nokia's operating margins in the mobile phone business reflect a surprising result, actually increasing from 17.8% to 25% even as average price is dropping from euro 89 to euro 83? How was this achieved? Some of this is probably from better manufacturing in better locations without compromising quality, moving factories to eastern europe and other places. Nokia plans to close a factory in Germany with 2300 workers and move this to Romania by mid-2008. The increased sale of higher margin multi media phones also helped. Another aspect of Nokia's approach- grasping the fact that extremely high sales were needed to do well in in the lower end of the market at the euro 30 price level. This means that competing in India and China with the high sales volume helps it stay ahead in this lower end. These markets are also interesting in another way, they are fast changing markets with a lot of things happening. Because they are price sensitive there is a lot of competition including from lower end makers in China. Asian markets also have young users who have different usage, lifestyle and trends and Nokia can learn a lot on how to stay abreast of these demographics and other changes. And competing at this level helps you develop the manufacturing knowhow to bring down the cost of the higher end phones with more features. There are crisscross benefits to competing at every price range in different demographics and in different regions, and continually learning and building the people and structures to compete effectively. . Nokia's successful strategies in 2008. ...

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The appreciation of the U.S. dollar and depreciating currencies in Africa in 2015 makes it costlier to import manufactured goods to African countries. Quality Supermarkets in Kampala, Uganda, struggles to fill its shelves with imported packaged foods and manufactured goods. The lack of financing for $30 million in crude supplies leads to the closure of a refinery in Lusaka, Zambia, and long lines at gas stations. The Zambian currency kwacha has depreciated by 17% against the U.S. dollar in 2015. Uganda's currency the shilling, Angola's currency the kwanza, and Nigeria's currency the Naira, all depreciated in 2015. This means larger trade deficits to finance consumer imports or upgrade infrastructure. In Uganda this means delays in upgrades to power lines and transformers. In oil producing countries such as Angola and Nigeria, and oil producers at the early stage such as Uganda and Ghana, there is a double whammy with lower oil prices leading to lower revenues to finance costlier imports. This is likely to slow growth in Africa from about 5% in recent years to 3.7%, according to Capital Economics forecast. Countries in Africa that import oil will see lower import bill for oil, but that benefit eroded by a depreciating currency. South Africa sees benefit of lower oil prices offset by lower revenues from commodity exports of iron ore, and the higher cost of imports with a depreciating currency. ...

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The Center for Strategic Studies in Moscow was prescient in predicting problems of declining support for Mr. Putin before the December 2011 parliamentary elections. Work with 32 focus groups by the Center in May 2012 shows a continuing erosion of support for Putin as efforts to open the political system have faded. The discontent focusses on the delivery of basic services such as healthcare, education, law enforcement, infrastructure.

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Japan's situation, a strong yen and a stagnant economy, continues in 2010.

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Max Fisher of the NYT points out the unique approach taken by Canada in the U.S.-Canada relationship - to cultivate a grassroots network of Americans in legislatures, business, and at different levels of government. This has enabled the Trudeau government to build a relationship with president Trump, and at the same time have relationships at different levels of government and with business in the U.S. to tackle issues where the Trump administration has acted in ways unfavorable for Canada. Provincial governments in Ontario and Quebec lobbied against a New York state government provision for Buying American on state contracts worth over $100,000. By emphasizing the $10 billion in exports from New York to Ontario this lobbying persuaded the New York legislature to cancel the provision. Premier Trudeau's popularity helps and the proximity to the U.S. means Canadians can visit quickly and understand the U.S. as a close neighbor. Still Premier Kathleen Wynne of Ontario says Canadian businesses are nervous about the uncertainty from the Trump administration.   ...

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Galston of the Brookings Institution says globalization has hurt workers in manufacturing with job losses and declining incomes. It has produced outcomes that have favored some industries such as tech, and not others such as automobiles which in the past helped create the broad middle class by offering good paying jobs to people with less than a college education. Immigration has created an issue that political leaders outside of the main parties have appealed to in France, the U.S. and Britain. The result is a polarization in the voters that has rarely been seen to this extent before. The middle class in the period from the 1950's to the 1980's is not the middle class that we see today in Europe and the U.S. The 2008 financial crisis added to the problems with the slow and uncertain recovery for some groups such as white men, the less educated, students, and people on minimum wage.