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

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The Economist points out that China's total debt of government, corporate and households has grown by about 100% of GDP since 2008. The 2009 crisis led to rapid increase in debt. It is now about 250% of GDP, according to the Economist. Slower growth of below 7% risks reducing China's ability to service this debt. About half of this debt is owed by state owned companies and property developers. China can use its sovereign reserves to continue supporting bank and state owned companies. Investor's are pricing bank shares to reflect about 10% of this debt as bad debt even though government estimates are much lower. The reserves provided China time to fix the banking system since 2008, yet the debt keeps growing and China has failed to take strong action in the last 6 years. Complacency is a problem, and the incentives for local governments to continue prior practices that increase debt continue. As Krugman and other experts have pointed out at some point the rules of finance will apply to China as they have for other countries that faced a debt crisis- Japan in the late 1980's, South Korea and other Aisan countries in 1997, and the U.S. in 2008. Even without a crisis through deft managemen and use of reserves China risks zombifying the economy as old loans are backed up by new loans, with the further risk of misallocation of capital or poor use of capital. This lowers productivity of capital and hurts development. With poor statistics such as the figure of 1% of debt being bad debt cited here, the problems of complacency can be magnified, as there is less reason for a strong response....

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This editorial in the WSJ says the corporate tax cuts could be one of prime minister Abe's biggest accomplishments. This is likely to increase growth if well formulated. Even though this came up late in the discussion process this move has the potential to increase investment and attract global capital.

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All major industrialized or OECD nations leaders ratings are low or poor in December 2024. Biden's is at 37%, Trudeau of Canada's 26%, Macron of France 19%, Scholz 18%.

Even newly elected Keir Starmer of Britain is about 34%. Ishiba of Japan 22%, Yoon South Korea 18%.

Biden's 37% looks decent in comparison. DJT at less than 50%.

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Response to question whether this $100 a barrel oil is possible is yes, if something big happens in the oil flows from middle east or if there is a Katrina style hurricane. Reason being that oil demand has not slackened up either from Asia or from the U.S. automobiles. How would this impact the USA, Europe, Asia? The impact on Japan and Europe would be less because of the high efficiency in use energy use. This could slowdown the U.S. economy considerably as gasoline approaches $5 a barrel. India would be hurt with a drop in GDP growth from 8% to 6% according to an estimate by Crisil, Mumbai. It would affect Chinese growth also but the main impact would be indirect through a decline in the U.S. market for Chinese made products. Russia would gain and economic growth there could accelerate further from 6% to 9% according to estimate by MDM Bank, Moscow.

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The global impact of the credit and housing crisis as it extends from USA to the rest of the world. Heavy machinery makers such as Japan and Germany are doing better than consumer goods exporters like China, and Asian countries like Thailand and Malaysia. And countries that borrowed heavily like Hungary are being watched by lending institutions. Commodities producers like Australia and Russia and Brazil are continuing to do well. For Middle Eastern countries the bigger danger is overheating in their economies as inflation soars. But while the crisis spreads the forecasts have only been taken down a notch displaying the conservative wait and see instincts of forecasters so that China and India still continue to grown near double digits which is not likely to hold up as one goes into 2008 and 2009 and actually might slip considerably from the high growth rates of the past as a number of factors converge especially in the case of China but also for India.

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Bernard Lewis's "The Arabs in History," is a short book which confirms Zakaria's point about the openness of Islamic societies before the 19th century, with some exceptions in certain periods. Most books or a quick look at Wikipedia shows us that the Renaissance in Europe in the 15th century got its boost from books by ancient Greek authors that were available in Arab societies long after they were forgotten in Europe. His point about Indonesia and India is also true to a large extent except for periods such as the one under Aurangzeb (17th c.). Muslim societies in British India (todays Pakistan and Bangladesh) experienced less social and educational reforms under the British than Hindu societies for various reasons leading to larger backwardness, illiteracy which breed extremist ideas. This is likely to change throughout North African Arab societies and South Asia in the next 50 years, especially with the modernization drive underway in India, which is likely to spread to other parts of the region. Islam as a missionary religion with force of arms spread in the 7th-9th century rapidly over Arab North Africa and parts of west Asia, and later to South Asia. Once established there were long periods of openness to ideas and books, and different cultures ( with the exception of preferences for Muslims), and a stress on commerce which inherently reduces religious vehemence, as the example of Britain shows. For this reason the current conditions in Islamic societies is more atypical than typical. A factor that has worsened it is that 19th c.-20th c. Islamic societies have put less emphasis on commerce and industry than historically seen in prosperous Islamic societies, on which more research is needed to understand why. Another factor is the impact of the interface with technologically and scientifically progressing Europe and America not becoming a learning experience for acquisition of this science and technology and making it one's own, a pattern seen in Buddhist societies of Japan in 19th c., South Korea in 20thc.,and China 21st c. Because Buddhism sprang from Hinduism or a response to Hindu ideas in India, India could be put alongside China for the 21st c. rapid assimilation of western science and technology making it one's own. When there is a violent collison between Japan and U.S. Admiral Dewey's ships, or China and British advances around 1900, the initial reaction of rejection is reversed with adoption of western technology and practices making it one's own. Similiar response in India. Islamic societies have had an extended period of rejection for reasons not fully understood even today. This is likely to generate the kind of internal debate about how to revert back to the usual mode of adoption in Islamic civilization, with the potential catalyst in India and other locations in the Middle East. The most respected German of the 19th century is Alexander Von Humboldt, a naturalist who advanced scientific knowledge, and a mentor to Charles Darwin in England, author of "Origin of the Species." Humboldt says- "There are no inferior races, we are all humans, and we are all destined to reach for and grasp liberty." That Humboldt spent most of his best years in Paris, France, which he compared to the provincialism in his native Berlin, goes to show how Humboldt, Darwin and Humboldt's friend Aime Bonpland of France, maintained close cooperation and friendship and anticipated the close cooperation in Europe since the second half of the 20th c., long before European politicians and governments grasped this. Commerce, science, travel, media and free exchange of ideas, are as favorable to progress as politics and ideology is inimical to it....

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Behind the June jobs numbers is the information that the average workweek fell to 33 hours, the lowest ever on record, and 0.8 hours lower than before the recession began. With the extra 48 minutes the same aggregate work says Denning of the WSJ, could be done by 3.3 million fewer employees. And the unemployment rate would then be 11.7% rather than the 9.5% it is now. The number of people working parttime has doubled to about 9 million or about 5.8% of the workforce. Employers will first try to employ parttime workers as full time, and increase hours of existing workers before they hire new workers deepening the recession.

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Zeit Online takes a look at German chancellor Angela Merkel's statement made in a beer tent in the Muich suburb of Trudering- "The times in which we can completely rely on others are somewhat over, as I have experienced in the past few days." Zeit Online says the words "ein Stuck" in German were meant to say a bit or somewhat, but the essence of the statement that the depending on the trans-Atlantic alliance was now over comes right through.

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This is a very informative interview with Joe Biden. So far Biden has given few interviews where he talks freely at length about how he plans to run his administration and what is most important to his heart. The title is very misleading in this respect. Unlike the inexperience of Obama with his "we won" we must be doing something right, Biden with his years of experience comes closer to Lyndon Johnson or Truman and the same drive to get things done. He says in this interview "there is no elation." He just wants to get somethings done as quickly as he can and he knows Congress as well as Lyndon Johnson did when he tried to get his vision of "the Great Society." It is almost as if the Biden sequel to the inexperience of Obama, is like the Johnson sequel to the inexperience of Kennedy.   To understand Biden is to know what hurts him most. Biden feels the pain that every rural county in America did not vote for him. He knows something is deeply wrong that this should happen as it has never happened before. It may be time to define diversity differently - people of diverse backgrounds not just ethnic or race but also whether with rural or urban backgrounds as they are today totally different. He also feels the pain that seventy two million Americans voted for Trump. He will judge his success or failure in winning over about half of them to bring this down from 47-48% to 25%. These issues will define and shape the Biden presidency. Can he deliver to the rural counties, health care, education, broad band connectivity, everything that has disrupted life in rural America from the way it was in the Truman and Eisenhower administrations when it comes to the social fabric. The China issue simply fits into this. European societies are feeling the pain of the fragmentation in their social fabric with starkly different opportunities for life in rural vs urban. Respect for fellow Americans comes before respect for China- or Japan, or India, or Europe. Biden understands what three decades of shift of manufacturing jobs to China and other countries have done to American communities, to small towns and the rural areas surrounding them in America. For this reason Biden does not plan to change the Agreement China made with the Trump administration for 25% tariffs on a portion of imports from China and China's written agreement to buy $200 billion of American products. For this reason his response to China's challenge emerging from trade policy set in motion by the Clinton administration, and allowed to continue by the Bush and Obama administrations with the addition of foreign wars that dissipated the country's finances urgently needed for infrastructure building and investments in education and advancing science and technology, is to reverse all the negative trends. Biden plans to make the investment in America that Mr. Trump started but to do this more effectively, he says.   ...

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On BBC: See key moments video of US Liberation Day, Rose Garden April 2, 2025. DJT describes decades of inaction by previous American presidents as the US and American workers, and factory towns were looted and pillaged of their factories by other nations. At one point he said the US lost 90,000 factories and it would be impossible to put 90,000 tacks on a map to show these lost factories from cheating by other trading nations including Japan, China, Taiwan, South Korea. And use of third nations Mexico and Vietnam by China, and Mexico by Germany to ship into the US. All this stops on April 2, 2025. In this way the US which made 100% od the worlds computer chips lost an entire industry to Taiwan. It also lost its electronics industries. And its pharmaceutical industry, so that antibiotics if not imported would not be available to the people of the United States. It becomes a antional security issue when the shipbuilding industry is also gone where one shipbuilding plant in china makes more ships than all the plants in the USA. And nothing was done about this till today. DJT said there is a simple way to avoid these tariffs- make in the USA and there are no tariffs. Already Apple he says has committed to invest $500 billion in the US and Taiwan to build the largest semiconductor plant in the world in the USA. And total investments in the US now add up to $10 trillion, says DJT. ...

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The Raisina Security Dialogue, India's version of the Munich Security Conferen ce was attended by the security chiefs of 26 countries. It was held in New Delhi March 1-2. Security chiefs from UK, France, Japan were present. The Conference is organized by the Research and Analysis Wing, India's external intelligence agency and the National Security Council Secretariat  (MSCS) which reports to Mr. Ajit Doval, Indian National Security Advisor.

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With cases from foreigners exceeding cases locally, outside of Hubei province for the last 6 days, China is now restricting entry of foreigners. All foreigners entering the country from South Korea, Italy, Iran or Japan are subject to a 14 day quarantine. A voluntary quarantine for 14 days is required for other visitors. 

Germany has relied on state and local governments to take action, with the federal government not intervening. 

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Th Bombay Stock Exchange closes after the Sensex surged by 17% in one day, after the decisive election victory of the Congress party, winning all but a dozen or so seats needed to have a majority at 272 seats in the new Parliament.