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Paul Ryan, speaker of the U.S. House of Representatives, wins the Republican primary in his house seat of Janesville, Wisconsin, defeating his challenger Nehlen, by 84% to 16%. The Republican nominee Donald Trump earlier had refused to endorse Ryan, and only reluctantly endorsed Ryan following the vice presidential nominee Mike Spence's endorsement of Ryan. Senator Susan Collins, senior Republican senator from Maine, joined other leading Republicans saying she would not support Trump. Paul Ryan has split with Trump on trade, immigration, Mexico, and other issues. He has insisted on decency and fairness in politics, and has won his seat in a working class town that had a closed GM plant in 2008 after Ryan voted to support rescue of the auto industry and worked hard to keep it open. Even though some of his policies have not directly helped working class families, he has won increasing support from his district as the economy recovered with unemployment down to 4.4% in Janesville, according to BLS for May 2016. Much of that support since 1998 has been based on Ryan's decency, faith and family. He made it a condition that he would go back on weekends to Wisconsin to stay in touch with people, when he accepted the position of Speaker of the House, and he listens to local concerns. Ryan said about the national discourse- "It's simple to prey on people's fears. That stuff sells, but it doesn't stick. It doesn't last. Most of all, it doesn't work." His job in today's deteriorated national discourse is as vital as ever, both for Wisconsin as representing the best in the national spirit, and for the country.   ...

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Responding to questions about bubble actvities in the economy at an IMF question and answer session and discussion with the IMF's Christine Lagarde, the U.S. Fed's Janet Yellen says she prefers to depend on regulation tackle this problem. Using interest rates as a tool would lower growth. "The potential cost, in terms of diminished performance, is likely to be too great to give financial stability risks a central role in monetary policy decisions, at least most of the time," said Yellen.

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Anne Applebaum of the Washington Post points out that after the faltering campaign of Republican Party nominee Fillon, the only serious candidates remaining in the presidential election in France are Marie LePen of the National Front, and the former Economy minister in the Hollande government, Emmanuel Macron. Macron is now the only person with enough popularity to win over LePen's nationalist movement. Macron launched his En Marche movement in 2016 and his strategy is to bring together the centre right and the centre left moderate voters, and voters who favor remaining in the European Union. Older voters in France unlike that in the U.S. and the UK are favoring candidates other than LePen because they fear the impact on the French economy and their pensions from leaving the European Union. LePen favors holding a referendum to decide whether France should remain in the EU. Macron takes an opposite view fully supporting France's role in the European Union. He has not advocated the huge cuts that Fillon has for job cuts in the public sector, and is able to draw moderate centre left voters to his side. A look at the French presidential election in another piece in the Economist magazine shows that further out one goes from major cities in France there is a surge in the support for the National Front. Moderate parties other than the National Front draw support in most of the major cities and urban areas. Another similarity with the UK and U.S> is that more educated voters support moderate parties other than the National Front. As polls have been proven wrong in other elections it is difficult to know what is likely to happen in this election. Unemployment is high in France at 10% with little change since the election of the Socialist Hollande government. Other issues such as terrorism have unsettled French voters, making this election difficult to predict. Voter dissatisfaction is especially high among younger voters who face a high unemployment rate and stagnant economy. Neither candidate Macron or LePen offers a way out of the low economic growth and lack of new jobs. A lot depends on whether French voters are willing to take the risks of a LePen administration and the further uncertainty from a referendum for leaving the EU which cannot enhance the economic prospects of France.     ...

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A former treasury secretary, and economist at Bradesco Management, Joaquim Levy, is appointed central bank chief for the second term of president Dilma Rousseff. During Rousseff's first term Brazil's currency lost a third of its value and the economy faces low growth and high inflation. Financial markets expect the new central bank chief to pursue conservative policies to keep Brazil's investment grade ratings. Levy has been in this kind of environment before. In Lula Silva's first term the economy faced many problems with high debt, prospect of default, declining currency, and lack of confidence in financial markets. Levy took over at Treasury during 2003-2006, when he pursued debt reduction and improved confidence. He is a University of Chicago trained economist and former IMF official.

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David Barboza of NYT describes the hidden subsidies China gives to Foxconn for its plant in Zhengzhou, in a poor region of China. The factory there makes about half a million iPhones a day. These subsidies include incentive packages, infrastructure building, local government help of about $1.5 billion. As a result Apple has high margins. For a 32 gigabyte iPhone 7 that costs $400 to make, the retail price is about $649 in the U.S.  The hidden subsidies is why Apple can maintain dominance as profits are reinvested. And the result is that with only 12% of the smartphone market Apple can take in 90% of the profit, according to Strategy Analytics. Barboza looks back at Apple before co-founder Steve Jobs left in 1985 as focussing on manufacturing at plants in Colorado and California. By 2001 with iPod sales soaring the move to China under Cook, who previously worked for Compaq, was underway. With the introduction of the iPhone in 2007, the move to China for manufacturing accelerated. The reason: only China offered the kind of subsidies, the speed of approval and building of infrastructure facilities, the local government support, the hundreds of thousands of workers, and the best tooling engineers, to produce in huge volumes with speed, and maintaining quality levels. Earlier plants including one in Colorado Springs that this Lyrarc editor was invited to visit just prior to Jobs rejoining Apple had many quality problems, so much so that Apple had a large part of the manufactured personal computers set aside for rework. The quality levels were dismal, defects were unbelievably high. This is the Apple manufacturing process and plant that Jobs must have seen when he returned, and which he hired Cook to fix. Not only were costs higher in the U.S., (subsidies in China came later) when Jobs looked at the manufacturing quality and the inability to get the quality he needed from American workers and engineers at that time in the 1990's, only then did he turn to China- and the more he saw what was possible to accomplish there he sensed an unusual opportunity to finally put the ghosts of memories from competition with Microsoft at rest, and to surpass everything that had been done in Silicon Valley. The result one of the most ingenious and large manufacturing networks in the world, huge profits for an American company, except for one thing- it would not do much for American workers. ...

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Liam Denning of the WSJ points out that the third quarter GDP numbers of 3.5% growth don't signal much beyond low quality numbers. WIth government distorting the cost of money, and pumping up demand for cars and housing, and in other ways propping up the economy all this good news may create a false sense of complacency, when as Denning says its only storing up problems for the future.

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One researcher sees the 2008 election not as a transformational one because just as Reagan's appeared as one it was a referendum on Jummy Carter's administration, and the 2008 election a referendum on George W Bush's administration. Both were hugely unpopular. And was more about the short term past than about the long tem future. What is different here is the economy which may be in a transformational mode if the downturn is long and prolonged, no matter who is in control.

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Allan Meltzer, professor of political economy at Carnegie-Mellon University and the author of the most comprehensive history of the Fed, and John Taylor, atop Treasury official under George Bush both oppose expanding the powers of the Fed and putting it in charge of controlling systemic risk. Meltzer says the Fed exacerbated the crisis by keeping rates too low for too long, and did nothing to control systemic risk. He also says the in testimony to the House Financial Services Committtee, that the Fed has in its whole history never done well in controlling systemic risk. It has failed to see the storms coming. Kohn, vice chairman of the Fed, says the change is only incremental, as the Fed has asupervisorty role already. Taylor's view is that the Fed does best when its responsibilities are limited to its original role. A change would dilute its main mission of steering the economy and jeopardize its independence.

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An example of the kind of information spread even in BBC and American media about US inability to make the most advanced chips because TSMC founders have decades of experience. In fact TSMC founder Morris Chang acquired his experience in chips in the US. The decades of TSMC experience are merely since the late1990's. The US was the only country making these chips when China was mostly an agricultural economy in the 1990's. It is only because of hidden subsidies and bad economic theory, that US let the chip technology be outshored. As soon as the people of America make the decision, bad economic theory will be discarded, and US will support its own chip manufacturing under bipartisan support in Congress and the White House, with the full support and funding of the American government.  The US can get things done once it makes up it's mind as the whole Nation. Advanced chips will happen very quickly in the US with the process already under way and supported by the whole Nation. People forget that bigger than chips, bigger than technologies of today, the Industrial Revolution of the 20th century began under Frances Perkins and Franklin Roosevelt in New York during FDR's term as Governor as New York State. It was at that time that New York state  was setup as the model of industry and labor, with new institutions and industrial landscape engineered by FDR and Perkins. This was transferred to 50 states during the 1930-1950 period- this is the industrial structure and economic structure that brought the Second Industrial Revolution in the 20th century to the world. Taiwan did not exist till 1950's emerging from Japanese rule, China from Japanese occupation till 1945, not emerging till 1990. ...

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US Airways has the weakest hub network of the old carriers. With continued problems for air travel from the poor economy the airline is estimated by analyst reports to lose $600 million in 2009, this on top of $!.5 billion in prior years. Robert Herbst of airline financials.com says that the airline has leveraged everything it could to raise cash and doesnt have any other ways. It sold 26 millio shares to Citigroup for $100 million. An increase in luggage fees is expected to raise $400 million this year.

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Government GDP figures show the GDP shrank by 1.8% in the third quarter of 2016 compared to the same period in 2015, the first such contraction in the economy since 2009. Household consumption was down 3.2%. The sharp decline in the value of the lira by 20% in 2016 makes imports costlier, in an economy dependent on consumption spending and tourism for higher GDP growth. Political uncertainty with instability in Turkey following a crackdown on opposition and media also leads to decline in foreign investment and investment by domestic firms.

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The Economist offers this exceptional account of how education makes a big difference in how two cities one hours train ride from London view exit from the European Union. Both have younger than average populations, are growing rapidly, and mostly white collar populations. Cambridge has one in two persons who have gone to university study, Peterbrough is predominantly a city of school leavers, one has many people who have studied till age 21, the other Peterborough where many people left school at age 16. Cambridge it shows is strongly pro-EU, Peterborough is euro skeptic. YouGov confirms the correlation with education of EU support, with the better educated graduates supporting EU membership 62% to 38%, less educated till age 16 43% supporting EU membership and 57% opposing. It says skills for a globalizing compettitive economy and the lack of these skills are creating two types of population with less and less room between them, not good for democracy, and something that will take decades of work to correct....

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 President Trump says China is backing off in negotiations to address U.S. demands for a fair relationship on trade. He says the U.S. will increase tariffs from 10% imposed in September 2018 to 25% on $200 billion of Chinese goods starting May 10, 2019. China has put tariffs of 10% on $60 billion of American goods exported to China responding to the American tariffs in last September.  The U.S. says since China joined the World Trade Organization in 2001 with the approval of president Clinton it has unfairly benefited in trade with the U.S., leading to closure of factories and loss of jobs in the U.S. with state subsidized Chinese exports to the U.S. contrary to the spirit of the WTO and its rules. China has made promises to correct this and not kept them says the U.S. side in negotiations led by Robert Lighthizer. The tariffs moves are a tactic of president Trump to get China to relent and make fundamental changes in the way it exports to the U.S.  So far the Chinese response has been tit for tat. But this can change. As this report points out what is already known that China benefits far more and exports far more to the U.S. than the U.S. does to China. The $60 billion of American goods exports on which China placed tariffs represent two fifths of China's imports from U.S. With smaller exports from the U.S. to China, China has not much leverage in trade negotiations in this kind of tit for tat retaliation. It hurts China's exporters and economy much more than it does U.S. consumers. The increase in prices for U.S. consumers are also not expected to be significant, according to this report in the NYT, if China increase tariffs further. Aware of this and China's belief that past administrations have not responded is a guide to what the Trump administration can or will do, has convinced president Trump that there is no other way to get a fair trading relationship that respects U.S. interests, its jobs and workers. As Robert Lighthizer who leads the U.S. negotiating team faced this type of response from the Japanese when he negotiated with them (shoving off U.S. demands to reduce Japan's trade surplus in the eighties before accepting them), the U.S. thinks this strategy will work again. In any case it sees no alternatives to achieve its goal of a fair and balanced trading relationship. The U.S. international trade deficit in goods was up to $891 billion in February 2019 even after the tariffs on Chinese goods in September, showing that it will take a lot more to turn this as well as other trading relationships around.   ...

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Neil Irwin of NYT provides some counter intuitive ideas on U.S. Fed interest rate policy. He says it can't be take as a given that the Fed will raise rates in 2017-2018. This depends on how much punch there is in the Trump economic policies for stimulus, and for infrastructure spending, tax cuts. He cites Senate Majority Leader McConnell who said he would like to keep "tax reform revenue neutral." Getting large spending and pushing up the deficit is likely to run up against Republicans in Congress who have for 8 years opposed large spending increases and large deficits. Trump has given few details about his stimulus or infrastructure spending plans. He says the scale of the spending might not match the talk. Irwin cites JP Morgan Chase economists who have kept their forecasts for GDP growth just under 2% for 2017 and 2018. And he points out that even Trump appointees at the Fed might act independently. The Fed might look at being cautious considering that increased trade tensions with China, and the unpredictability of a Trump administration could hurt growth. Irwin does not mention the uncertainty in other areas such as policy towards Russia on which the Republican party and Congress have very different views than Trump, tensions over Taiwan, that can also affect growth. ...

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Why Rachel Reeves type of strict financial rules will hurt Labour. DJT in the US relaxed the borrowing limit to $5 trillion, and has designed his One Big Beautiful Act to have parts of it to boost the economy and investment. Reform UK gains on both sides with Reeves efforts to cut benefits losing Labor voters and it's struggles on migration hurting it on the other side with conservtaive voters who voted Labour. With the Conservatives in disarray, Labour has to keep its focus on improving the lives of Britons.  Today it does not matter whether you are Social Democrat or Christian Democrat or Socialist, what matters is to have common sense policies that help te vast majority of people even in unconventional ways by breaking the rules or fixed ideas about what can be done. DJT and Merz are on the Christian Democrat side, Denmark's PM Mette Frederiksen is Social Democrat, what matters is to have a culture and policies that help the people and stands up for ordinary people in the Nation. ...

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Dependence on China increased during the Merkel years to extreme levels. A EU survey shown in this DW.com report shows that of 137 products and services deemed critical, including fields such as renewable energy and health, almost 50% are supplied by China and only 3% by Russia. German foreign takeover laws and acquisition laws are being upgraded only now after years of China's investment in German technology and critical infrastructure  companies. The Merkel administration took a lax approach to protecting German technology and critical infrastructure. A similar situation existed with the Obama administration in the US. New regulations give the German government a veto in all critical mergers and acquisitions. This DW.com report says that today Germany's protected sectors include energy and telecommunications, medical technology, artificial intelligence. The problems  with the previous approach in the Merkel years that showed a complete disregard for protecting vital technologies was that the Economy Ministry in 2016 was not able to stop the full takeover of the flagship German robotics company KuKa by a Chinese manufacturer of dishwashers and refrigerators Midea. In 2018 a Chinese state electric utility company SGCC sought to get a 20% stake in 50Hertz a German electric grid operator which was turned back. Only now with the entry of the Greens under Habeck and Baerbock in government has Germany adopted a clear policy of effective action to protect German technology and critical infrastructure companies. ...

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Xi Jinping is said to have brought up the collapse of the Communist Party in Russia under Gorbachev in a closed door Dec. 2012 meeting of Communist Party officials in Guangdong province. A summary of comments obtained by the media shows Jinping bringing up the situation in Russia, where he said the "ideals and convictions wavered," the system suffered decay, the military and the party went in different directions, leading to collapse of the Communist party system. In Jinping's words it took only one word from Gorbachev for dissolution of the Communist Party, and nobody else came out with a different view. Jinping faces several challenges- tackling corruption in the party, making changes in the economy that move it in a different direction from the dominance of the state owned enterprises, improving the condition of people left out by the economic boom from unemployed students and migrant workers to people in rural areas.

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Biden's hard work and going into details and seeing that projects are delivered on time and in quality for the $1.2 trillion infrastructure law will make him an enduring president in the 21st century. Tyler Pager gives this report on the Biden style of making decisions and of getting things done on time that are making a big difference for the ease of living for all Americans.  Of Biden using his 36 years of negotiating in the Senate more than any Congressman including LBJ who only had 12 years, and the hard work from someone who commuted by Amtrak for all those years and attended to every detail. For the president who started out as county councilman in Delaware details matter, he looks into the details of rebuilding infrastructure by delivering projects on time and on scale. In late 2022 Tyler says Biden checked into the details of delays and wanted specifics which projects were not delivered on time for the $1.2 trillion infrastructure law passed a year earlier. Seeing this only one leader comes to mind prime minister Modi of India who is faced with a huge task of infrastructure projects and investments that are intended to make India the third largest economy in the world. Modi like Biden uses his experience of getting into details and checking that work is delivered on time, putting in the hard work in earnest, from Modi's work with state projects in Gujarat when he led the state for 15 years as chief minister. ...

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India agrees to an immediate ceasefire after a call from Pakistan's head of military operations for a ceasefire. The conflict started with attack on tourism that was reviving the Kashmir economy after three decades through a terrorist attack killing 26 tourists in Phalgam, Kashmir on  April 22, 2025 in the mountains near the Pir Panjal range. 24 million tourists visited Kashmir in 2024. Indian response was swift on May 7 early morning hours attacking 18 terrorist camps inside Pakistan occupied Kashmir and inside Pakistan. India called it a act of self-defense to Pakistan sponsored state terrorism going back to 1947. What is different in this brief 4 day war is that India made it economic with efforts at IMF to make terrorism an issue for loans to Pakistan, and ending the Indus Waters Treaty on water sharing. Pakistan economy is struggling with no debt relief from China, making it turn to the IMF, a politically split population with Opposition leader Imran Khan in jail, and continued domination by the military over civilian govenrment. On May 9 drone attacks were launched from Pakistan using Turkish made drones in large numbers on cities and towns in Gujarat, Rajasthan, Punjab. Blackouts were placed in India by May 8 in all cities in the north and in Pakistan. India responded with its own drones and missile attacks on three military airbases as the war broadened to military targets on May 10. US mediated a ceasefire through Saudis and Turkey. Earlier Saudis and Iran were in New Delhi with whom India has good relations to get a ceasefire. Mr. Trump's efforts behind the scenes secured an agreement. VP Vance had cut short an Indian trip in Jaipur on April 22. India and the US are allies in the Indo-Pacific, and India and Russia have decades of friendly relations. China now uses Pakistan as a proxy state, but does not provide the economic aid it needs, for which it has turned to the IMF.    ...

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Germany's DW.com says in this report- "However, economists have pointed out that the US benefits from having large trade imbalances with the rest of the world, as the dollar is used in most trade, and offers major tailwind effects to the US economy." Which economists one must ask? Most of these economists had turned their back on the working people in factories in America, on their wages turned into a downward spiral, on their jobs, their factories lost for three decades. Today the American people have a sense of the true cost of this colossal failure to protect American workers and small towns across America depending on manufacturing. The pandemic exposed the risks of supply chain shocks and inflation by overly concentrating manufacturing in China.  The US has 1 trillion in trade deficits each year and it is completing the destruction of manufacturing in the US. Half of this is with China as China exports through Vietnam and Mexico, third countries, in addition to 295 billion dollars of trade imbalance the US has with China. China, Mexico, Canada and Vietnam are the largest offenders. No country can long endure with such a loss of its manufacturing base. The US Navy itself is in danger without the manufacturing to compete with China that has taken up over 50% of shipbuilding, and soon will not be able to protect the free world if these types of economists and self serving German or other foreign interests drive a false narrative. Without the US Navy in the Pacific, Atlantic and Indian Oceans no one is safe, not Germany, not the EU, not India or the rest of the world. ...

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The euro trades at $1.1942 to the U.S. dollar on Jan. 5, 2015. The drop in the euro would help the eurozone economy by increasing exports, and by acting against deflationary trends. Worries about Greece's upcoming election weighed on the euro.

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The NYT's look at the televised debate between Macron and Le Pen for the presidential election. Macron has this to say in closing about Le Pen's shelving her plans for exit from the European Union compared to her position in the last election. "It's a project that doesn't say its name but entails leaving the European Union. I'm not lying about the goods, you are lying about the goods." Macron says Le Pen is being disingenuous about this, arguing that by reducing French contributions to the Eu budget and by ignoring fundamental rules of the EU such as freedom of movement and the single market, that would lead to a de facto exit from the European Union for France. Lyrarc has shown today on this page how the debate was covered in FR24, DW.com, The Guardian, BBC News, WSJ, and NYT. One of the key questions is what would she or some other candidate such as Mr. Melenchon done differently than Mr. Macron- For the once in a century pandemic? Macron is not faulted by any one for the work done by two prime ministers he appointed for the task. What would she or some other candidate done differently for today's surging inflation, considering that it is happening worldwide? Are their aspects of France's welfare state, and her economy and the currency that are better protected under the European Union than in a situation of de facto exit. The absolute power in the French presidency is something that happened after a weak system of prime ministers and coalition governments in the period between the two wars, and that power used wisely enabled De Gaulle to take decisive steps  over a decade for France in the post war modernization of France. This was a problem for Melenchon with his calls for a new Republic and a new constitution. Yet many of todays problems of decaying communities and once prosperous industrial towns in decay in the north, northeast and the south require a next generation industrial revolution to bring manufacturing back to France and back to the European Union, and large scale investment in France, as is happening today in the US which is confronting the same problem.    ...

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Barley points to the other factors surrounding the ECB decision for massive monetary easing on Jan. 22, 2015. THe ZEW and IFO business sentiment indicators show an upward trend, and the German economy is picking up momentum in 2015. The lower oil prices, and the decline in the euro boosting exports, are two other factors pointing to higher growth in 2015. Just as the U.S. QE program came at a time when economic conditions were improving, the same can be said for the Draghi ECB QE program in Europe, says Barley. Draghi appears to have sent a strong signal to financial markets, just as he accomplished in July 2012, when bond yields of Spain and Italy were over 7%.