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France's finance minister Bruno Le Maire announces a $45 billion effort to cap energy price increases for electricity and gas to 15% increase. Earlier efforts had capped the increase to 4% till the end of 2022 in a tariff shield (bouclier tarifaire). France's public accounts minister says the budget being presented is "a budget to protect." Windfall taxes on energy companies will reduce the cost of the $45 billion to $12 billion. Other protection is offered in the form of increasing income tax brackets by 5% to lower the tax burden. In the absence of this effort the energy prices could have increased by more than 60%, says the Finance Ministry.

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American viewing habits are changing quickly. Streaming services and cable TV are now at the point where streaming has 34% of viewers and cable TV has 34% of viewers. Streaming is growing at the rate of 22% a year and cable TV is declining at 9% a year. Broadcast TV has 21% of viewers and is declining at 10% a year. Streaming services are You Tube, Reuters for news events and entertainment streaming is done by Netflix, Apple TV and Amazon.

This means fewer and fewer viewers will follow the news channels, such as MSNBC, Fox News, ABC, CBS and more will be communicated on You Tube and internet news services.

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The Trans Pacific Trade Agreement TPP adds so liitle, only 0.04% to Britain's GDP in 15 year from 2023, says the Office of Budget responsibility in Britain. It is this trade agreement ignoring American workers that Mr. Obama and Hillary Clinton pushed for leading to the Democrats defeat in the 2016 election. Most of the trade deals including ones with Canada and Australia add up to no more than 1% to Britain's GDP when the loss of the EU through Brexit means a loss of 4% of GDP for Britain. This is how much the trade deals were over hyped by the Brexiters Johnson and Sunak.

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Delta Airlines is switching its frequent flyer program entirely to spending on its American Express Card. No miles for flights. Delta gets an astounding $7 billion from American Express from sales of miles, ancillary fees and brand fees. Its goal is $10 billion which would be what it made from tickets for flights in 2022. Delta's CEO says it may have gone too far with these changes which are unpopular with its flyer base except for the high end flyers who disliked crowded lounges. Were there other ways to tackle that problem? Delta appears to have shifted attention to a small fraction of its customers.

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President Biden has asked for $18 billion for child care stabilization, the children's infrastructure of today. Republican controlled Congress is not responding. Nationwide 16000 childcare providers closed their doors across 37 states in 15 months of 2020 through March 2021. Childcare givers in the US make less than parking attendants, says this story in The Washington Post. Federal grants provided help in Wisconsin and other states, but this money dried up and more childcare centers have closed. This is the soft infrastructure that America needs and is so crucial- for its children and for mothers and fathers. The losses reverberate through local economies. And it disrupts parents, especially mothers ability to work. 

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The  Washington Post review of archived radio transmissions in this report suggests a possible cause of the Palisades Los Angeles wildfires- reignition from a previous fire on a mountain ridge just 6 days prior on New Year's Eve. That fire was knocked out only to reignite. Smoldering fire can stay in wood and underground only to reignite in very windy conditions even for 10 days. In though very windy conditions were expected LA Fire Department lacked the resources to stay on it for a few days - in what the Washington Post citing the LAFD says is in a stretch of Temescal Ridge in the Santa Monica mountains.

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Autoworkers want a raise of 40% from depressed levels with two tiers one for entry level workers set really low during a crisis when auto companies were near or entering bankruptcy. Automobile companies want to use high profits for EV vehicles.  Autoworkers have worked hard through the pandemic and have suffered low wages for a decade, now face a cost of living crisis- the 40% should be seen in the context of starting a depressed level trying to meet costs of living that have surged in 2021-2022. If both conditions are removed the increase might be a modest closer to 10% over a hypothetical higher wage and lower cost of living.

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This report in the Post reminds readers that Mr. Trump is right on the issue of dairy industry tariffs imposed by Canada. The tariffs are 270% on milk, 245% on cheese and 298% on butter, according to the CBC. These tariffs are designed to protect the dairy industry in Quebec. In Canada the tariffs are referred to as "supply management system."  Canadians in the western provinces are used to paying higher prices on dairy products than prices in the U.S. Canadian prime minister Trudeau has declared that he is "100 percent ready" to defend these tariffs. Mr. Trump has brought this up in his talks with Trudeau.

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Surprisingly very little can be found on the internet on how the relationship between Apple's Tim Cook and Foxconn started and how it evolved over the two decades- a key to understanding the two decade rise of Apple since 1998 when Tim Cook, an Alabama engineer, joined Apple's Steve Jobs to rebuild an almost demolished Apple. It is also key to understanding the rise of China in manufacturing to the point of excluding all other countries, including the US, for major investments. It is also key to understanding how the social relations have been disrupted in the US, how the US workers and families suffered from outshoring on this massive scale never before seen in the US for 100 years of the Industrial Revolution since Lincoln in the 1860's. This has not significantly changed to this day as the US goes into the midterms to elect a new Congress. Mr. Trump ruffled sentiment on this issue but had little action or results to show for it to reverse this. Mr. Biden is making some headway as the US elects a new Congress in November 2022 to take up the tasks to restore American leadership in manufacturing and in technologies that support advanced manufacturing from semiconductors to renewable energy. What happens now depends on many things. Mr. Cook talks about intuition as a main driver along with preparation and hard work in his project which has done little for America and the American people, in the sense of how its communities look like, and how its families live, as they are largely excluded from Cook's Apple project. Even as it employs about 3 million workers of contract manufacturers, for the most part in China with Foxconn. Total employees in the US are 37,000 mostly highly paid engineers and technical workers. The 270,000 working in what it calls its ecosystem are mostly workers in retail stores paid much lower wages. Of manufacturing there is little on the scale in China. Not since the days of Lincoln in the 1960's who fought a civil war so that the rights of labour in the US were protected as seen in his message to Congress in the 1860's, and through the Industrial Revolution for 100 years, has something like this happened in the US. It is not about some manufacturing taking place in Asia, it is the sheer scale that excludes America from significant manufacturing, about 300,000 workers in the US mostly in lower paid retail jobs, and 3 million in China with contract manufacturers that is an aberration from history. It is about delegating an entire supply chain in manufacturing that constitutes this huge aberration.     ...

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China's July 2012 exports were up barely by 1%, over the same month prior year. Exports to the European Union declined by 16.2%. A big problem is cost increases for land, labor and electricity. By 2004 China's exports were growing at a peak rate of 35%. Since then prices of inputs have increased- wages by 150%, land by 70%, and electricity prices by 30%, according to Dragonomics. The yuan appreciated by 30%. Productivity is increasing by about 8% a year, according to the World Bank. As a result of the price increases of inputs the competitiveness of China, with products exported mainly on the basis of price, is deteriorating.

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France's Baccalaureate exam goes back to the days of Napoleon. Students take 15 exams in their final year in high school. Since 1808 it has not changed much. French president Macron is changing the exam as part of reform of the education system. Changes include making 40% of the score coming from in class testing. The philosophical essay is retained. Students are tested on knowledge that helps them think quickly on their feet.

Teacher pay has not changed much in 15 years and teachers protested recently asking for resources not reforms. One of the problems is that more students pass the exam, 60% compared to 40% thirty years ago, and many flunk out in the first year of college. The value of passing the exam is not as before with fewer job opportunities. Changes are seen as needed because the Bac exam was treated as sacred and little was done to adapt it to the changing times. 

 

 

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Global smartphone shipment sales are dropping with sticker shock over new smartphone prices, dropping 7% worldwide, and 15% in China in third quarter 2018, according to Canalys. Apple sales have stagnated in China at 8% market share, and shipments volumes have declined by 11% in 2018. Apple gets 20% of its sales revenue from China. Apple is now in fifth place behind Huawei, Oppo, Vivo, Xiaomi in China. Each of the Chinese brands gained from 2 to 5% increase in market share while Apple with its high pricing has stagnated. Apple had high hopes for the Apple XR priced at $945 and ordered large volume of the phone for sale in China. It now has excess unsold inventory of that phone as Chinese competitors with prices at little over half the Apple price the Huawei Mate 20 are proving to be strong competitors. The fact that the Chinese market has declined by 15% in smartphone shipments hurts Apple, even though trade tensions have not created anti-Apple sentiment.   ...

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Consumer lending went down by 1.7% in October 2009 according to Federal Reserve data. A WSJ analysis of Fed data shows corporate and consumer credit markets have shrunk by 7% or $1.5 trillion in the 2 years through early November 2009. And ont he other hand the Treasury debt outstanding has gone up quickjly by 40% as the governmet tries to finance large deficits. The market for every type pf bond has recovered from the crisis, and money is going into the markets, but this does not mean more money is flowing into the economy. The tighter lending results in consumers and businesses more reluctant to hire and invest. Mohamed El-Erian, CEO of Pacific Inestment Management Company says this means the US econom will grow at 1.5% to 2% ayear compared to the 3% growth that is typical for healthy growth. Says Erian: "the idea that we have reset to where we came from is false. It is abumpy journeyto anew destination with significant long-term effects."

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Gerlad Seib points out that one should look less at what president Trump accomplished in the first 100 days and more at how he operated and learned during this initial period. This is certainly true because much of what happened in the first 100 days contradicts some of the tone that Trump setup during the campaign. When it comes to governing Trump has made an effort to learn and adapt and show resilience in the face of early setbacks on the travel ban and the health care bill, the Flynn episode. After this early period Trump took on a more disciplined approach, gave more room to and listened to more respected advisors- Tillerson on foreign affairs in shaping policy with Russia leading to Tillerson's presence at Lucca massacre memorial in Italy sending a clear signal about U.S. policies in line with its role in the past century in world affairs, Gary Cohn and Ross on economic policy and seeking Cohn's advice on tax plan, Ross's on NAFTA negotiations with Mexico. As a result the NAFTA fears were calmed down with statements by Wilbur Ross, the Commerce Secretary, that the goal was a win-win relationship with Mexico. Trump worked with his party in Congress to have the Supreme Court nomination of Gorsuch approved. Meetings with Merkel of Germany and Jinping of China were carefully planned and new relationships established as Seib points out, without ruffling trade relations. The appointment of Robert Lighthizer, as Trade Representative, also shows that efforts to give the U.S. a more level playing field in trade will be resolutely pursued in the win-win context. Lyrarc has profiled Lighthizer earlier in this decade after his op-eds in the media as he correctly anticipated the changing public mood on the need for fairness in trade relations. On relations with China and South Korea, Jim Mattis has taken the lead, and Pence's visit to South Korea also show deftness in handling what is one of the most difficult issues in foreign affairs. Mattis and Tillerson also have helped reinforce the Republican party policies on NATO and Europe, with the visit of NATO secretary general Stoltenberg to the White House. In the end it is how much you can learn in the first year, how much you listen, and the courage to act in difficult situations, the willingness to act contrary to one's instincts and self interest where necessary, that matters. This is especially true in an environment where as Seib points out the Democratic Party stands opposed to the Trump administration following a bitter election campaign.   ...

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Questions remain about how well Mehmet Oz, who had a popular television health show Dr Oz, can deliver on reducing obesity levels, handle the cuts in Medicaid, and tackle the overspending on Medicare Advantage, as head of the Center for Medicare and Medicaid Services, With it's $1.5 trillion budget it is the largest agency in the US government other than Defense. It is also not delivering health results as American health for the dollars spent is failing to deliver, many nations in Asia and Europe have better health with a small fraction of the US cost.

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Casey describes the crucial policy errors in Brazil with over spending and lack of transparency in the years leading to the crisis in 2014-2015. Brazil raised interest rates half a percentage point in May 2015 to 13.25%. Inflation was at 8.13% in Brazil in March 2015. Brazilian companies have large dollar denominated debt accumulated during the boom years which needs to be refinanced as its currency the real declines. With current policies economic growth is likely to continue at 0-1%. Russia made policy errors with the departure of Kudrin as finance minister for Putin's second term as president. Policies to attract foreign investment, controlling military expenditures, and continuing growth were reversed as Russia took positions on Ukraine that led to western sanctions, capital outflows, and a sharp decline in the ruble. By May 2015 the ruble and oil prices had recovered from lows, but the ruble was still 35% below the level in June 2014, and the oil prices were still only two thirds of the peak in 2014. Russia sees the decline in the ruble as a way to reduce imports and increase import substitution for many products. The economy is weakened by high inflation- inflation was 6.9% in March 2014, going up to 16.9% in March 2015. In May 2015 Russia lowered the target repo rate by 1.5 percentage points to 12%. Russia faces stagflation- high unemployment with low GDP growth, and high inflation....

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Ormat, a geothermal energy company, faces resistance to a new geothermal plant in Nevada.  130 residents in the desert town of Gerlach fear it will affect spring water in the ground. Ormat has 15 plants in Nevada that produce 433 megawatts or electricity for 325,000 homes. NYT shows this as an example of how conservationists who favor green energy find themselves pitted against energy companies doing renewable energy for profit. The Burning Man festival held in the desert has a large carbon footprint every year. 

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David McCoullough, dies at 89 years. He is the author of two best selling biographies of American presidents at crucial points in the American experiment on Harry Truman (1992) and John Adams (2001), for which he won 2 Pulitzer Prizes. He also won the National Book Award for- Path Between the Seas- the Making of the Panama Canal. He saw writing as painting in words, and writing as an art form, did extensive research so that his Truman book took 10 years, the Adams book 7 years. 

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How huge wildfires are affecting the stratosphere 6 to 31 miles above the earth and creating a swirling vortex of smoke reaching 21 miles high that is spreading across the planet. Circling twice around the world according to some studies. This resulted in fire induced thunderstorms in Portugal, South Africa and Argentina.

Wildfires in California have sent plumes of smoke 10 miles high altering air quality in places as far as Europe. Fire seasons are getting longer in many parts of the world as a result of this.

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French regional elections show a defeat by Conservatives of Le Pen's far right party and president Macron's party. Conservatives maintained a lead of 10% of the vote over Le Pen's party. Macron's party failed to make it to double digits in the vote with about 7%. Sixty six percent of voters stayed away from the poll. The Conservatives and the Socialist parties did well holding on to their regions. This changes the landscape for the presidential election in 2022. 

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The transport sector accounts for a third of German energy consumption and a fifth of gas emissions, making it a sector that will come up for major overhaul after elections. The Greens party in Germany is making this a major issue in the elections. The massive flooding in Germany and severe drought conditions are seen as effects of climate change that is moving to the top of the agenda. Greens are polling in the 15-20% range and are likely to be a key partner in a new government.

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The strike at Royal Mail in the UK as workers reject a 2% raise not enough to cover inflation, higher costs for food and energy. Royal Mail has 140,000 workers. A similar strike over a 2% raise is affecting Britain's transportation sector with rail employees on strike on certain days. This is the result of Tory Conservative policies. In France there is a cap on energy costs, no such cap exits in Britain which has inflation exceeding 10%, and workers struggling after years of austerity cuts.

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New bicycle lanes in Paris, Milan, to Mexico City are changing the way cities see people getting to work or moving round. New bicycle lanes are popping up in many cities. In Paris the plan by order of the mayor is to provide 400 miles of pop-up bicycle lanes throughout Greater Paris. Car lanes are giving way and being transformed into bicycle lanes. 

Oakland has moved to have 10% of the roads for bicycle lanes. In Montreal extra 70 miles are added. Bogota added 47 miles.

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In an effort to take decisive action early the quarantine is extended from Lombardy to the whole of Italy. Travel is restricted to places where people live. Italy has suspended payment of bills, taxes and mortgages. All open air assembly and sporting events are banned. Italy's quarantine is similar to the quarantine in Hubei province China, where cases have dropped sharply showing that it worked in China. Italy is also setting aside 10 billion euros for the effort to contain the coronavirus crisis and mitigate the economic impact.