As promised, the coverage on Romney has tried to turn more favorable, with “Three Reasons the 2012 Race Could Still Change” on page A6 in the Wall Street Journal (WSJ). Notably, the turn has not been completely rounded, with the article acknowledging the problems, but the intent is there. Expect to see more—horse races are how the media makes its money.

One potential game changer is the introduction of foreign policy as a central part of the race. “Race Focuses on Foreign Policy” made the front page of the WSJ, while the New York Times (NYT) had “Republican Team Attacks Obama on Foreign Policy” (p. A11). Apparently, Obama’s lead in this area is eroding, and it represents a potential opening for the Romney team. With everything that is happening, there is the potential for a disaster abroad, which could damage the Obama campaign. This is not a guaranteed win for Romney, though, as the Financial Times (FT) points out in “Romney’s China holdings criticized” (p. 8), reminding us that Romney has vulnerabilities of his own on the international front.

Honestly, when the lead headline in the Wall Street Journal (WSJ) is about the costs of “free” checking, and it runs right above a story about the Emmys, you know it is a slow day. We have the usual follow-up stories: Greece will probably be back in the headlines soon in a big way, but for now, France is trying to buy it some more time; in China, Bo Xilai’s police chief was sentenced to 15 years, and Japan warned China on the island conflict. And, of course, we have U.S. politics.

The U.S. political stories are the most interesting, in that they don’t focus on the elections but rather on the underlying issues. The New York Times (NYT) has two articles, “Liking It or Not, States Prepare for Health Law” on the front page and “What Do Teachers Deserve? In Idaho, Referendum May Offer Answer” on page A14.

I sat down with Wall Street Week contributor Carrie Coghill to review the investing landscape. In this segment, we discuss why Congress needs to “do something smart,” and where investors can find yield and safety.

Watch: How the “Fiscal Cliff” Is Hurting the Economy Now

I wanted to mention a couple of stories today that actually brought some good news. The first two are on a point that I have made a couple of times—most clearly in the Economics and Politics webinar I linked to back in July—about how the U.S. is in a relatively strong competitive position, despite the glaring weakness of capital dependency.

The stories, “Cost advantages build case for US industrial revival” on page 5 of the Financial Times (FT) and “A Manufacturing About-Face: Made in America and Sold in China” on page A18 of the New York Times (NYT), both talk about how U.S. manufacturing is regaining its competitiveness, although they come at it from different angles. The FT story references a Boston Consulting Group (BCG) report, which predicts that growth in U.S. manufacturing could add five million jobs in the U.S. by 2020. Although the FT story indicates that some analysts are skeptical, the NYT coverage supports the idea of a revival by identifying and describing several companies that are doing exactly what is described in the headline—manufacturing in America and selling abroad.

As expected, the problems in Europe have not been solved. The eurozone continues to shrink, and a Spanish bailout continues to look inevitable. The papers had multiple stories.

The U.S. papers led with Romney stories again. The New York Times (NYT) has “Daunting Path Greets Romney Before Debates” and the Wall Street Journal (WSJ) has “Headwinds for Romney in Latest Poll Results,” both on the front page. The stories largely expand on points we discussed yesterday. The WSJ story talks about how Obama is pulling ahead in critical swing states—especially Iowa, Colorado, and Wisconsin—and is maintaining his lead in Ohio and Virginia. The NYT story expands on some of these points and adds a good graphic that lays out state-by-state comparisons.

The papers also highlight deeper issues with the campaign. The Financial Times (FT) has “Romney adviser quits campaign” (p. 5), which discusses that Tim Pawlenty—a former Republican candidate himself—has stepped down as cochair of the campaign and mentions a pointed nonendorsement by the Club for Growth, an antitax lobbying group. “Cash Low, Romney Striving to Find New Large Donors” (NYT, p. A12) expands on the financial issues facing the Romney campaign, which I discussed briefly yesterday, and “Obama, Allies Outspend GOP Rivals in August” (WSJ, p. A6) is consistent with Romney having financial issues as well.

The U.S. election (of course) was all over the papers. It is interesting to see the papers’ different perspectives: the Wall Street Journal (WSJ) on the right; the New York Times (NYT) on the left; and the British Financial Times (FT) relatively nonpartisan, but still a financial paper with all that implies. The FT linked a “Romney regroups” picture on the front page to “Romney tries to sooth donors” (p. 5), which states that Romney is trailing in nearly all of the swing states and is limiting public events in order to spend more time fund-raising.

The NYT story seems to confirm some of the FT’s key points, with “Romney Campaign Cautious with Ad Budget, Even in Key States” (p. A13). The article says that the campaign has been at a significant advertising disadvantage in key states due to limited financial resources, and that the imbalance would be even worse were it not for Super PAC spending on his behalf. The limitations are reported to be because much of what Romney has raised is earmarked for other uses, not as campaign funds. In fact, the article reports, the Obama campaign is actually raising more in usable campaign funds.

Although China’s not a big presence on the front pages today, it is again all over the news. As I mentioned yesterday, Bo Xilai’s future looks increasingly dark. Stories in the Financial Times (FT) on page 4, the New York Times on page A7, and the Wall Street Journal (WSJ) on page A10 all discuss that China has now implicated Bo in the cover-up of the murder of a British expat—the murder his wife was convicted of. The information apparently came from the (two-day) trial of Bo’s former police chief, which we discussed yesterday. How can a modern economy have a third-world legal system? I don’t think it can, at least not over time. China has benefited from low transport costs, from a perception that it was not a threatening country (at least not threatening to the West), and from very cheap labor, but all that is changing.

First, low transport costs have gone with cheap oil. Second, the perception that it is not threatening—well, look at all of the analyses I have posted over the past couple of weeks, as well as today’s “Panetta Urges Beijing to Resolve Island Spat” and “China to Probe Attack on US Envoy,” both on page A11 of the WSJ, not to mention “Brussels sidesteps China trade dispute” on page 1 and “West wrestles with China trade links” on page 4 of the FT. Finally, cheap labor is still there, but there are other countries that are as cheap or cheaper.

I was never a big fan of Popeye. The whole eating-your-spinach thing wasn’t what I was looking for as a small boy. The Federal Reserve (Fed), however, seems to be a fan of Popeye’s friend Wimpy, as the thrust of its recent policy has largely been to pay later for the hamburger we eat today.

The most recent quantitative easing (QE) program is a great example. Rather than just pushing off deleveraging for a while, the unlimited asset purchases—at least until the economy recovers—aim to stop it completely. If it were that simple, the problem would have been solved already.

Perhaps I should be more like my cable provider, which seems to have a channel for any conceivable interest, by starting a China channel, as there will certainly be enough content to fill it. The news from China continues to be worrying on both a political and an economic front.