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Jim Campbell will replace Dewar as head of Chevrolet. He reports to Susan Docherty, head of sales, service and marketing for GM.

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Reinhart and Rogoff, 2 eminent economists who worked together on a book on financial crises since 1300, think that the current crisis has much deeeper to go, and the slight recovery in financial markets does not suggest that the imbalances in the economy are corrected. They point to economic weakness as a mechanism by which these imbalances are corrected. For example the economic weakness may be corrected by the weakening dollar resulting in accelerating exports from the U.S. The 1987 crisis had overvalued stock markets relative to earnings as an imbalance, and the 1998 LTCM crisis excessive hedge fund borrowing. Once these underlying imbalances were corrected the economic recovery was back on track. But the Fed's bailout of Bear Stearns has only put the financial markets on a safer footing. It has done little to correct the basic imbalances in the economy of over indebted consumers, and of lost wealth in housing, at the very moment that there is restricted access to credit. The financial market crisis only opened up the weakness from the extremely high leveraging used by the investment firms something like 1:30 by firms from M. Lynch to Goldman Sachs. The Fed's actions gave them time to shore up their finances and recover and the interest rate cuts and government checks help the economy, but not significantly enough to promote investment or increase consumption. The government checks would be used experts estimate for paying down debt and in this way it helps indebtedness a little, but does little to support consumption or promote investment, This the Fed's action also fails to do. The economy contracts and exports help the economy in recovering. The contraction itself say these economists is a necessary mechanism to make the adjustment in every crisis, until something else like exports helps create a recovery. Take December 1997, the Korean crisis. In this crisis the Korean companies invested heavily and were overextended , they borrowed heavily from the banks which in turn borrowed from overseas in dollars. When the Korean currency hit a record low against the dollar it became difficult for Korean companies to pay the increased cost of the dollar loans and many companies failed. As investment was slashed unemployment went up from 3% to 7.9%. Ted Truman, who worked on the Korean rescue effort as a Fed official, is now a scholar at the Peterson Institute of International Economics. He sees as similar to the overexpansion of housing and consumption in the U.S., the overexpansion and excessive borrowing in Korea's corporate sector in the years preceding 1997. After the rescue in Jan 1998, the Korean currency recovered by rising 63% in that year. Did this mean the crisis was over, just as the Bear Stearns bailout leads to gradually settling markets this year? During 1998 the Korean economy sank into a deep recession, the economy shrank 6% in 1998 when it was used to growing at 8%. Nouriel Roubini, another economist, who heads RGE Monitor, a financial and economic forecasting service, sees it this way. First, the mortgage loan imbalances are set into correction mode mechanism, then second, the economy contracts from housing and consumer debt going in reverse mode, then the third effects come into place as this feeds back into the financial system in the form of defaults on industrial loans, municipal bonds, and consumer credit. Additional sequences are in finacial system distress and government and Fed response to set the corrective mechanisms in place, but to also reduce the distress to the financial system and ensure that it is safe. We are where the first effects have ocurred, but before the second and third effects which should take place sometime in 2008 and 2009. The importance of understanding this cannot be overstated for business, planners, and investors because conducting business in this environment or planning or investing will require special skills and temperament which are different from the skills and temperament required in the expansion mode if one is to produce good results....

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Most Congressmen are skeptical of Obama's plan to give the Fed new powers to meet the kind of emergency created by the glovabal economic crisis. Their concern is that the Fed may let the property bubble develop wihtout taking any action, and that the Fed failed as abank regulator. Congressman Ron Paul is co-sponsoring abill that would require Congressional audits of the Fed, which has the support of two thirds of the House.

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The Dutch model for counterinsurgency which intertwines the civilian efforts with aid workers working inside the military, and military work focussing on security for the people so that economic development projects can go on, is an inspiration for the US effort. It has also reduced casualties for the Dutch. Only 19 deaths have occurred for the Dutch for 2000 personnel employed since they deployed in Uruzgan province in March 2006, where 350,000 Afghans live, according to icasualties.org. Sec of state Hillary Clinton describes this 3 D effort of defense, diplomacy, and development, as the model for her own efforts and that of the Obama administration. Dutch soldiers are ingrained in their training for this mission that their main work in Afghainstan will be economic development. The aid workers work closely with the soldiers and the commander Col. Gert-Jan Koolj says over time the focus has been on pure development. In fact diplomats from the Dutch foreigh ministry help to command the Dutch team in Uruzgan. One problem Clinton is facing is the shortage of civilian personnel to work in provincial reconstruction teams. About 500-600 more civilians are needed to complement the additional 21,000 troops that are to be added in 2009. ...

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A shocking fact about oversupply in one crucial industry. Automakers worldwide have the industry capacity to make 94 million vehicles. According to researcher CSM Worldwide the current sales in late 2008 reflects demand for 60 million vehicles worldwide. This is about 34 million extra vehicles and represents about 100 plants. Toyota has already cut production in Japan by 27% in November, the biggest cuts seen at Toyota in 30 years. The numbers for 2009 will reflect a deepening downturn from higher unemployment and lower spending. Not all of this capacity wil be cut as automakers will look for a rebound as customers replace aging vehicles, but as sales decline in Russia, China and emerging markets and in the USA and Europe, some consolidation will take place and many plants will have to close in the US, China, Portugal, Italy and Spain.

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The irony of the Afghan war is that the same pilots and planes that worked for the Soviet supported Afghan government, that the US under President Reagan supplied weapons and antiaircraft missiles to bring down, are now fighting the American war against insurgents. Antonov aircraft for transport and Mi-35 Hind helicopters, and Afghan crews that flew them are part of the airforce that the US is training and building up. The commander of Afghanistan's air corps is a formerMiG-21 pilot. By 2016 the 32 aircraft airforce is expected to grow to 120 aircraft at a total cost of $5 billion.

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BAE Systems has a $120 million contract to provide social anthropologists to the Defense Department of the USA. In December, L-3 Communications Holdings Inc. acquired International Resources Ltd, a Washington based economic-development firm which is different from its military advisory business. This is the way the Defense Department and the suppliers to the Defense department are changing in response to Defense Secretary Gates philosophy that economic development, rule of law programs and strategic communications and a whole host of soft power initiatives are essential needs, and to the new President's philosophy. Now US Defense suppliers Lockheed and Northrop are providing peacekeepers thorugh the State Department, and BAE SYstems is providing social anthropologists in addition to armored vehicles to go with US troops on village patrols. The State Department, Agency of International Development and a changing Defense Department are all getting the attention of suppliers who are building new relationships for new needs and new services tackle the issues of terrorism, poverty, drugs and crime that generate or exacerbate conflict in other countries. In the first budget presented recently Obama pledged $50 billion double the amount before for foreign assistance. A portion of the $130 billion requested for wartime operations in 2010 will be allocated to these new kinds of services which are more effective and generate better understanding and support for the US in other countries....

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In this exceptional piece Krugman says Greece has won flexibility in the negotiations with the EU in April 2015, contrary to the media coverage. He says under the Samaras government negotiated agreement with the EU the primary surplus, the difference between the revenue and expenditures not including interest on debt, would have to be triple what it would be now for the next few years. This is the only figure that matters, says Krugman, as it is the amount that is transferred to the creditors. The Syriza government plans to run only a small primary surplus, which itself involves large sacrifices in Greece with the drop in revenues from the decline in the economy. Language about future surpluses is left obscure, and Greece continues to get financing for the next few months. In other areas Syriza agreed to structural reforms in the labor market regulations, and to take strong action against tax evasion, which he describes as constructive steps on the path to economic recovery.

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The night of January 29, 2011, in Alexandria Egypt, as the Egyptian people of all classes of society, ordinary citizens, overcome massive police presence and tear gas. The writer directs the global emergencies program at Human Rights Watch. He saw firsthand the attacks by security forces of the Mubarak regime on unarmed protestors calling for Mubarak to step down after 30 years of autocratic rule, and the restoration of basic freedoms.

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The 50th anniversary of the Elysee Treay between Germany and France. Konrad Adenauer and Charles de Gaulle signed the treaty in 1963.

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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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The startling truth about health "reforms," - they won't control spending, and without that the whole system of health care will rapidly become unaffordable and unsustainable. Obama's Council of Economic Advisors points out in new report that since 1975 annual health spending per person, adjusted for inflation has grown 2.1 percentage points faster than overall economic growth per person. At this rate health spending which was 5% of the GDP in 1960, and is 18% of GDP today, would grow to 40% of GDP in 2040. Medicare and Medicaid would increase from 6% of GDP now to 15% in 2040, or equal to three fourths of federal spending. Employer paid insurance premiums for families which grew 85% in inflation adjusted terms from 1996 to $11,941 in 2006, would increase to $25,200 by 2025 and $45,000 in 2040. This would force employers to reduce take home pay. Samuelson says the uncontrolled health spending is singlehandedly determining national priorities, reducing discretionary income, raising taxes, widening budget deficits and squeezing other government programs, while it is producing large amount of waste in medical spending. See the link to Prof. Tyler Cowen of George Mason University in NYT, 6/14/ 2009, who cites the habit of doctors to write many expensive tests as one of the prime culprits in the wasteful spending. And in the process it delivers higher cost for lower overall quality of health for the American people. This at a time when many European countries provide live examples of doing it in a better way- lower cost, better health. The serious problem with the Obama health reforms says Samuelson is that it talks about restraining spending but may end up increasing spending. Its talk about controlling spending he says is good intentions, but based more on hopeful thinking, public realtions and risks becoming cosmetic reform. Because to really control spending will require coming to grips with its fundamental cause- hospitals and doctors are paid mostly on a fee-for-service basis and reimbursed by insurance, private or governmental. Such a system encourages doctors and hospitals to provide more services, expensive tests, favors heavy use of expensive medical technologies to increase profits, and for patients to expect them. Samuelson puts his finger on the root of the problem - there is no incentive and every disincentive for all the players in this game , doctors, hospitals and patients to seek reform of this system. For doctors and hospitals the hope would be that this cosmetic "reform" would leave the system basically unchanged, and patients to continue with a lifestyle and expectations that do not not acknowledge the fact that a lot of healthcare does not come from spending but from preventative care, education, good eating and exercize habits, and healthy lifestyles. And the uninsured are no exception, they would simply start consuming the expensive care for lower quality of overall health like everyone else. With this kind of situation confronting us, the views of Samuelson, and Professor Tyler Cowen of George Mason University, as welll as a growing chorus of informed public opinion on this subject, is that insuring the uninsured is a good idea, but doing it within the bounds of the present system, can only increase the costs. And too much is at risk, to rely on what Samuelson calls a scattershot of measures to control costs made up by Congress such as "evidence -based guidelines," "electronic record-keeping," "bundled payments to hospitals, to give the illusion of progress that won't make a serious difference. A sweeping restructuring of health care is needed, that would overhaul "fee-for-service" payment and reduce the fragmentation of care. It will also need what has not even be touched on adequately in the debate. This is the massive need for education in the schools about nutrition, eating, exercize, healthy lifestyles. It would also require opinion leaders in each field from sports and other fields to lead by example and with constant public presence, the media, and companies to form a partnership with private institutions to change existing eating habits and lifestyles that encourage obesity, smoking, fast food eating habits, large portions in restaurants....

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Russell Shorto, director of the John Adams Institute in Amsterdam gives a detailed account of lives of different people he visited in various parts of Greece in January 2012.

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Join the author in BBC's travel series Slocomotion as he takes a cycling trip through Adirondack National Park in upstate New York stretching up to the Canadian border. The Empire State Trail in the Adirondacks is the longest trail in the US, a 750 mile bicycle route from southern tip of Manhattan to the Canadian border. It passes through the Hudson Valley, the Catskills, and along Adirondack park's eastern edge.

During the pandemic this is a popular route. The cool thing says one local in Saranac Lake, who guides people on cycling trips, is that people who don't normally venture out in cycling are doing this to get away from the pandemic. The idea of being on a bike and pedaling out in the wilderness to get the beneficial health effects of the outdoors is capturing the imagination of people.

 

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Jerome Powell, the new head of the U.S. Federal Reserve values continuity in policy, suggesting that the U.S. central bank will gradually raise interest rates in 2018. A raise is expected at the March 2018 Fed meeting. Powell said at his swearing in ceremony- "While the challenges we face are always evolving, the Fed's approach will remain the same. We are in the process of gradually normalizing both interest rate policy and our balance sheet with a view to extending the recovery."  Five interest rate increases since December 2015 have taken the short term benchmark rate to a range between 1.25% and 1.5%. During 2018 3-4 rate increases are expected.

Powell is seen as a consensus oriented leader with a focus on careful evaluation and rigorous study. Powell is pushing for a continuation of the Fed's policy to improve transparency, and responsiveness. 

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Heidelberg, in southern Germany, and smaller cities like Freiburg and Tubingen are seen as "green cities" in the sense that the people there have an open international outlook, are well educated, look at new ideas, and are idealistic. The Green party is in power in the southwestern state of Baden-Wurttemberg since 2011, where these three cities are located. Greens have about 20% support in elections here compared to 8% nationwide. Here Dr. Franziska Brantner, the representative in the Bundestag describes the orientation of people in the state. Heidelberg was able to handle the 600 refugees coming at the peak of the crisis very easily. Heidelberg's university, the oldest in Germany was founded in 1386. Students make up a quarter of the population of 156,000, and most of the Green party voters have university degrees, more than any other party according to Die Welt.

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How Nokia designs its phones. It uses teams of anthropologists, and psychologists in its design group to understand the ways people around the world behave and communicate. The designers go into the field and look for changes in behaviour new patterns , and look for new ideas , so new phones van be designed based on what they se anfd understand in the field. A research group looks atmacro societal trends and short term micro trends based on colors textures fashions. It looks for local country specific trends and at regional similiarities. Nokia is looking for something it did not realize before also, a learning process. Thats how it stumbled on the idea of a phone that would be shared by a group of people in poor rural areas. And this had to be designed differently to make it easy to use but also not look like a cheap phone. There would be a shared address book, protection from dust on the keypad, and a demo mode making it easy to use, and a call tracker to allow people to track cost. With this kinds of phones Nokia expects to sell to 2 billion of these phones to new customers in the next 10 years in China India Brazil and Africa. Nokia is also setting up a design studio with a design school Shrishti in Bangalore....

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Politicians, militant groups, intelligence agencies and security forces, unsettle the Kashmir valley, at a time when Pakistan faces a serious economic crisis, and India faces a slowing down and inflation also. Changing the demography of Kashmir and the dispute over 99 acres seems rather phony and it shows that political unrest can be whipped up when there is such a long legacy of conflict even when the conditions worldwide in developing Asian countries are shifting to modernization.

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Sweden gets a centre left government led by Stefan Lofven, who gets a second term in office. He managed to put together an alliance of centre left parties with the Green Party and Liberal paties after the elections gave 40% of the vote to centre left and centre right and proved inconclusive. Lofven governs without a majority in parliament because the minority government has support form other parties with 77 votes in parliament that abstained. Both centre right and centre left did not want to join with the far right anti-immigration Sweden Democrats. Lofven says Sweden chose a different path than other governments that sought to form governments with anti-immigrant parties. He said "in Sweden we stand up for democracy, for equality. Sweden has chosen a different path." To get Centre and Liberal parties support Lofven promised to cut taxes, reform the rental housing market, and relax strict employment laws.