The U.S.-China Business Council, a nonprofit organization that promotes trade between the two nations, has released data on exports to China from each state. Last year, Texas exported more than $10 billion in goods to the country. California exported more than $13 billion. Based on the gross export data provided by the U.S.-China Business Council, 24/7 Wall St. reviewed the 10 states exporting the most goods to china.

While U.S. exports to China grew by nearly 300% in the past 10 years, the growth has slowed substantially in the past several years as China’s economic growth suffered from the global recession. U.S. exports to China increased by just 6.5% last year. Despite the slowing growth, it was still better than nearly all other export partners, said Daniel Anthony, research director at Trade Partnership, a Washington D.C. economic research consulting firm.

For the first couple of months of this year, U.S. exports to China rose by 4.3%. While it was far less than previous years, “the rest of the world are up 0.2%.” explained Anthony. “So, in a lot of ways, at least for the first couple months of 2013, export Growth to China is really the only game in town.”

The states that export the most goods benefit from demand that remains strong in China but is weak in most other countries. According to Anthony, in the first few months of this year, machinery exports to China rose by 13% and declined by 7% to the rest of the world. Computers and electronics exports to China increased by 18% and fell by 3.4% to the rest of the world. This benefits states like California, which alone accounts for well more than a quarter of all U.S. computer and electronics shipped to China.

Other states that have benefited from growing Chinese demand include Washington, due to increased demand for its aerospace industry. Ohio and Illinois are profiting from increased demand of soybeans and other crops. Michigan has benefited from rising auto shipments to China, which grew 23% in the first few months of 2013.

Not all evidence suggests that trade with China is unconditionally positive for all Americans. According to the Economic Policy Institute, between 2001 and 2011, America’s trade deficit with China led to the displacement of 2.87% of all jobs in California. In Minnesota, another top exporter, this figure was 2.66%. However, Anthony notes, “it doesn’t make sense for the U.S. to hang on to low-value jobs.” Instead, he argues, Americans should focus on promoting jobs that utilize the U.S.’s relative strengths and advantages, while exporting less valuable work.

To determine the 10 states with the most exports to China, 24/7 Wall St. reviewed figures provided by the U.S.-China Business Council, a nonprofit organization that promotes trade relations between China and the United States. All figures provided by the council are not inflation adjusted. Data on exports for different metropolitan areas comes from the International Trade Administration (ITA) and are for 2011, while figures on crop exports are produced by the U.S. Department of Agriculture’s (USDA) Economic Research Service and are also as of 2011.

These are the 10 states sending the most goods to China.

Sony also cuts targets for smartphones and camera sales. (Reuters)

A complex Irish tax loophole helps Apple Inc. (NASDAQ: AAPL) save billions in taxes. (Reuters)

Merck & Co. Inc. (NYSE: MRK) sets a $5 billion share buyback through Goldman Sachs Group Inc. (NYSE: GS). (Reuters)

Sprint Nextel Corp. (NYSE: S) raises its offer for Clearwire Corp. (NASDAQ: CLWR), but many investors think the new sum is inadequate. (Reuters)

Jamie Dimon has a stronger position at J.P. Morgan Chase & Co. (NYSE: JPM) now that he will keep both the CEO and chairman jobs. (WSJ)

Prosecutors may use the Racketeer Influenced and Corrupt Organizations Act (RICO) to charge SAC Capital Advisors. (WSJ)

Ford Motor Co. (NYSE: F) will increase production by 200,000 vehicles this year. (WSJ)

ESPN, which is majority owned by Walt Disney Co. (NYSE: DIS), begins a series of large layoffs. (WSJ)

Phone companies start to sell subscriber data to marketers. (WSJ)

Vodafone Group PLC (NASDAQ: VOD) says it will use a dividend from Verizon Wireless to expand its main businesses in Europe. (WSJ)

Renault and Nissan aggressively invest to increase market share in India. (WSJ)

J.C. Penney Co. Inc.’s (NYSE: JCP) $2.25 billion loan, backed by real estate, will show how much leverage such assets hold. (WSJ)

The new Microsoft Corp. (NASDAQ: MSFT) Xbox will face rising competition from online games. (NYT)

The Bank of Japan decides not to increase its monetary easing plans. (FT)

Japan’s trade deficit rises as high-priced imports offset the effects of a weaker yen. (FT)

Rumors surface that Sony may spin out its entertainment unit. (Bloomberg)

Apple executives are set to defend the company’s tax practices and call for corporate tax reform on Capitol Hill Tuesday amid harsh criticism following a Senate investigation.

A report released Monday by Senators John McCain, R-Arizona, and Carl Levin, D-Michigan, charged that Apple “has used a complex web of offshore entities — including three foreign subsidiaries the company claims are not tax resident in any nation — to avoid paying billions of dollars in U.S. income taxes.”

The report says Apple relies on a number of unusual accounting tactics along with a handful of subsidiaries in Ireland — where it has negotiated a tax rate of less than 2% — to reduce its tax bill. The U.S. corporate tax rate stands at 35%.

And The Wall Street Journal says on findings about Apple’s tax practices:

Apple used technicalities in Irish and American tax law to pay little or no corporate taxes on at least $74 billion over the past four years, according to the Senate panel’s findings. The investigation found no evidence that Apple did anything illegal. Aides to the subcommittee said they have never seen a company use a subsidiary that didn’t owe corporate income taxes to any country.

Apple didn’t dispute that entities it set up didn’t pay corporate taxes but denied they were designed to avoid taxes. The company said it pays local taxes on overseas earnings and U.S. taxes on investment income generated at its Irish subsidiaries.

Near the top of the business headlines is the battle that Congress has started to wage with Apple Inc. (NASDAQ: AAPL) over the taxes it pays. By some measures, the company barely pays taxes at all. Among the evaluations of the Apple showdown with Capital Hill, one comes from CNN Money:

Apple executives are set to defend the company’s tax practices and call for corporate tax reform on Capitol Hill Tuesday amid harsh criticism following a Senate investigation.

A report released Monday by Senators John McCain, R-Arizona, and Carl Levin, D-Michigan, charged that Apple “has used a complex web of offshore entities — including three foreign subsidiaries the company claims are not tax resident in any nation — to avoid paying billions of dollars in U.S. income taxes.”

The report says Apple relies on a number of unusual accounting tactics along with a handful of subsidiaries in Ireland — where it has negotiated a tax rate of less than 2% — to reduce its tax bill. The U.S. corporate tax rate stands at 35%.

And The Wall Street Journal says on findings about Apple’s tax practices:

Apple used technicalities in Irish and American tax law to pay little or no corporate taxes on at least $74 billion over the past four years, according to the Senate panel’s findings. The investigation found no evidence that Apple did anything illegal. Aides to the subcommittee said they have never seen a company use a subsidiary that didn’t owe corporate income taxes to any country.

Apple didn’t dispute that entities it set up didn’t pay corporate taxes but denied they were designed to avoid taxes. The company said it pays local taxes on overseas earnings and U.S. taxes on investment income generated at its Irish subsidiaries.

Goldman’s S&P 500 Target

The sentiment about the value of stocks continues to be relentlessly positive. None other than the powerful investment bank Goldman Sachs Group Inc. (NYSE: GS) has increased its target for the S&P 500. According to MarketWatch:

The Standard & Poor’s 500 index will rise 5% from current levels to reach 1,750 by the end of this year, said Goldman Sachs in a research note dated May 20. A team of strategists led by David J. Kostin, chief U.S. equity strategist, said the index will “advance by 9% to 1,900 in 2014, and climb by 10% to 2,100 in 2015.” The 2013 return implies a year-end price/earnings ratio of 15 times, which is a one mutiple-point premium to Goldman’s fair-value estimate. Improved economic growth, rising dividends — Goldman expects those dividends to gain 30% between 2013 and 2015 — and potentially low sustained interest rates are all contributors to the higher S&P 500 forecasts. If interest rates stay low despite better growth then upside to those S&P 500 targets could be bigger than they are currently forecasting, said Kostin.

New Xbox Unveiled

Microsoft Corp.’s (NASDAQ: MSFT) most important product announcement since Windows 8 will happen today as it releases details about its next generation Xbox. The hype already has begun. NBC News says of the new Xbox launch:

On the eve of Microsoft’s planned Xbox reveal, the company has finally ended its long silent streak to say that the new console will actually be unveiled in two stages.

Speaking on the latest Major Nelson podcast, Microsoft’s interactive entertainment chief of staff Aaron Greenberg said that his company will roll out its next-generation video game hardware in two steps — first at a special event held tomorrow at the Redmond, Wash., Microsoft campus, and then at a more game-centric event during the Electronic Entertainment Expo (E3) in June.

“We have so much goodness that there’s no way we could have packed it all into one event,” Greenberg said.

“The best way I can describe it is: We’re really going to tell one story across two events,” he added. “So we’re going to start on the 21st [of May]; and really that’s about revealing the next Xbox platform and our vision for the future of games, the future of entertainment.”

If sales are poor, Greenberg will be out of work by the end of the year.

Douglas A. McIntyre

A successful vote to split the chairman and CEO jobs at J.P. Morgan Chase & Co. (NYSE: JPM) could still prompt Jamie Dimon’s departure. (Reuters)

Congress presses Apple Inc. (NASDAQ: AAPL) on how little it pays in taxes. (Reuters)

Dish Network Corp. (NASDAQ: DISH) may buy the spectrum of LightSquared. (Reuters)

The U.S. government says Amazon.com Inc. (NASDAQ: AMZN) has been given a security clearance that will allow it to do business with federal agencies. (Reuters)

Goldman Sachs Group Inc. (NYSE: GS) sells all of its shares in China’s ICBC. (Reuters)

Mutual funds become more aggressive about high director pay. (WSJ)

J.P. Morgan likely will change the number of its board members no matter how many are reelected. (WSJ)

Stringent work rules may make it hard for U.S. companies to get the layoffs they need to complete turnarounds. (WSJ)

A Chinese firm that makes large investments overseas sets up a U.S. office to focus on private equity and real estate. (WSJ)

More reports about Apple supplier Foxconn indicate that workers continue to commit suicide. (NYT)

Softbank approves the ability for Sprint Nextel Corp. (NYSE: S) to share data with possible buyer Dish Network. (FT)

A huge corn planting may undermine prices. (FT)

Apple’s stock price by itself shows how investors have devalued the company and its products. A month ago, its share price was down 40% from its 52-week high. BrandZ would argue that the drop does not matter. The research firm’s methodology is such that Apple’s troubles could be swept under a rug:

It is the only study to combine measures of brand equity based on interviews with over two million consumers globally about thousands of global ‘consumer facing’ and business-to-business brands with a rigorous analysis of the financial and business performance of each company (using data from Bloomberg and Kantar Worldpanel) to separate the value that brand plays in driving business revenue and market capitalization. Consumer perception of a brand is a key input in determining brand value because brands are a combination of business performance, product delivery, clarity of positioning, and leadership. The ranking takes into account regional variations since, even for truly global brands, measures of brand contribution might differ substantially across countries

However, that explanation is inadequate. Apple’s brand valuation was higher by 1% year-over-year in the current study, which makes the BrandZ number even more questionable.

The most useful contrast among the top brands in the study, at least as far as how odd the results are, is that Google Inc.’s (NASDAQ: GOOG) brand value was only up 5% to $133.7 billion. Google’s success over the past year, in contrast to Apple’s, would argue powerfully for a much better increase.

As for the balance of the top 10: International Business Machines Corp. (NYSE: IBM) ranked third with a valuation of $112.5 (down 3%). It was followed by McDonald’s Corp. (NYSE: MCD) at $90.3 billion (down 5%), Coca-Cola Co. (NYSE: KO) at $70.4 billion (up 6%), AT&T Inc. (NYSE: T) up 10% to $75.5 billion, Microsoft Corp. (NASDAQ: MSFT) down 9% to $69.8 billion, Marlboro down 6% to $69.4 billion, Visa Inc. (NYSE: V) up 46% to $56.1 billion, and China Mobile Ltd. (NYSE: CHL) up 18% to $55.4 billion.

The valuations are not meant to track stock price alone, or a foundation of value based in financial results. However, the values at least should not be entirely offset by these things. As such, Visa’s revenue last year was up from $9.2 billion to $10.4 billion, and net income fell from $3.7 billion to $2.1 billion. These results are well less than spectacular, and might even be counted as mediocre. How do they justify a 46% increase in the value of the Visa brand?

BrandZ is free to use its own complex valuation model — it is the company’s survey, after all. But when the valuations do not true up at all to the real world, all the results have to be taken with a great deal of skepticism.

What is so interesting here is that Apple is sounding more and more like any other company that wants to maximize its tax benefits within the existing laws. Taxation of foreign income is an ongoing hot-button and it will be interesting to see exactly how this debate will take place now that it includes Apple. Will the public continue to think that Apple can do no wrong?

Apple’s defense starts out that it is likely the highest paying corporation for income taxes in America. It also talks about employing tens of thousands of Americans and pays billions of dollars each year to the US Treasury in corporate income and payroll taxes. Keep in mind that Apple now has well over $100 billion in cash. The company would also have to pay out billions upon billions of dollars that would be a penalty if the company brought that cash back into the U.S.

The company said, “Apple welcomes an objective examination of the US corporate tax system, which has not kept pace with the advent of the digital age and the rapidly changing global economy. The Company supports comprehensive tax reform as a necessary step to promote growth and enable American multinational companies to remain competitive with their foreign counterparts in both domestic and international markets.”

Apple will claim that it has created or supported approximately 600,000 jobs in the US, broken down as 50,000 by the company and another 550,000 or so at other companies. Some 290,000 of those are tied to the new “app economy.” Apple also claims that its 2012 U.S. tax bill of $6 billion is close to $1 of every $40 in income received from corporations. It showed a 30.5% tax rate last year and expects to pay closer to $7 billion in 2013. Here are some additional bullet points:

• Apple has been a powerful engine of job creation in the US.
• Apple pays an extraordinary amount in US taxes.
• Apple does not use tax gimmicks.
• Apple carefully manages its foreign cash holdings to support its overseas operations in the best interests of its shareholders.
• The dividends distributed among Apple’s international affiliates, including AOI, are not subject to US corporate income tax.
• Apple’s cost sharing agreement with two of its subsidiaries supports high-paying, tax-revenue generating jobs in the US.
• AOI performs important business functions that facilitate and enhance Apple’s success in international markets; it is not a shell company.
• Apple supports comprehensive reform of the US corporate tax system.

The company’s full pre-testimony report is here.

Bernanke’s argument could be that the education of young Americans, particularly in math and the sciences, is not adequate to keep the U.S. in the innovation race. The superior educational attainment of children in Asia and parts of Europe will chip away at the American lead in creating the products which will drive the global economy in the decades ahead.

The strength of Bernanke’s argument is that most new wave of products and services still have their beginnings in the U.S.. The includes software and hardware products from Apple Inc. (NASDAQ: AAPL) and Google Inc. (NASDAQ: GOOG), and more mundane processes like “fracking”

Bernanke’s case, which does not exclude nations outside the U.S. entirely:

Finally, pessimists may be paying too little attention to the strength of the underlying economic and social forces that generate innovation in the modern world. Invention was once the province of the isolated scientist or tinkerer. The transmission of new ideas and the adaptation of the best new insights to commercial uses were slow and erratic. But all of that is changing radically. We live on a planet that is becoming richer and more populous, and in which not only the most advanced economies but also large emerging market nations like China and India increasingly see their economic futures as tied to technological innovation. In that context, the number of trained scientists and engineers is increasing rapidly, as are the resources for research being provided by universities, governments, and the private sector. Moreover, because of the Internet and other advances in communications, collaboration and the exchange of ideas take place at high speed and with little regard for geographic distance. For example, research papers are now disseminated and critiqued almost instantaneously rather than after publication in a journal several years after they are written. And, importantly, as trade and globalization increase the size of the potential market for new products, the possible economic rewards for being first with an innovative product or process are growing rapidly. In short, both humanity’s capacity to innovate and the incentives to innovate are greater today than at any other time in history.

The U.S. needs to take it to heart as much as any other country

However, buried in the earnings release was good news about e-commerce. Walmart’s online sales rose more than 30%. In its most recently reported quarter, e-commerce giant Amazon.com Inc. (NASDAQ: AMZN) boasted its revenue was up 22% to $16.1 billion. Based on those statistics, Walmart has become a force to be reckoned with in online retail sales.

Walmart’s e-commerce revenue is only 10% of the company’s total. However, that puts the number at more than $40 billion. Obviously, Walmart’s disadvantage is that it owns stores, a problem that is impossible to underestimate as it tries to crawl out of a period of flat revenue.

Walmart does have several critical advantages in its online business. The first is clearly brand recognition. Amazon may be universally known as the e-commerce leader, but Walmart’s brand is as visible as nearly any in the United States, and to some extent overseas.

Walmart also has the second largest online web property in the United States, according to research firm Comscore. Walmart sites had 41 million unique visitors in March. Amazon had 121.4 million. The gulf is tremendous, but Walmart has some means to close it, at least when the spotlight returns to the advantage of its huge overall revenue.

Walmart has begun to do some things that should increase online sales impressively, some of which leverage its store base. Buyers can order online and pick up merchandise at stores. Amazon cannot nearly match that. Walmart also has moved toward same-day delivery of goods ordered online. Amazon has started to do the same. Walmart may not be ahead in this critical race, but is not behind.

Many analysts believe that Amazon’s real advantage has been the creation of its Kindle line. The tablets range from e-readers to modestly powered PCs. The electronics help Amazon boost online sales, particularly of digital media products. Walmart cannot match the Kindle program. It might however, form a strategic alliance with another maker of tablets. Troubled Apple Inc. (NASDAQ: AAPL) comes to mind.

Walmart may be behind Amazon in e-commerce. That does not mean the world’s largest retailer cannot make substantial gains.

Foxconn, once one of Apple Inc.’s (NASDAQ: AAPL) largest suppliers, says it needs additional time to cut back worker overtime. (Reuters)

Dell Inc.’s (NASDAQ: DELL) profits fall, but that may not stop the fight over its future ownership. (Reuters)

Samsung runs out of some key parts for its smartphones and may have to turn to competitors for more inventory. (Reuters)

J.C. Penney Co. Inc.’s (NYSE: JCP) new CEO says it will take several quarters to salvage the company. (Reuters)

Dish Network Corp. (NASDAQ: DISH) will press the FCC to look at the Softbank bid for Sprint Nextel Corp. (NYSE: S). (Reuters)

EBay Inc. (NASDAQ: EBAY) could create apps for Google Inc.’s (NASDAQ: GOOG) Glass product. (Reuters)

Northrup Grumman Corp. (NYSE: NOC) will try to buy back 25% of its shares by 2015. (Reuters)

The Securities and Exchange Commission to charge Nasdaq OMX Group Inc. (NASDAQ: NDAQ) with a record fine for failing to keep track of trouble in its own markets. (WSJ)

The stock market is not hurt by an earnings season with many poor results. (WSJ)

Shareholders of J.P. Morgan Chase & Co. (NYSE: JPM) are sent a letter supporting Jamie Dimon’s attempt to remain as both chief executive officer and chairman. (WSJ)

Wages in China rise sharply in the past year. (WSJ)

Wal-Mart Stores Inc. (NYSE: WMT) says that consumers are “stretched” due to an uneven economy. (WSJ)

A new way to account for leases may increase the amount of debt some companies carry on their balance sheets. (WSJ)

Google says several companies, including CNN, Twitter and Facebook Inc. (NASDAQ: FB), have made apps for Google Glass. (NYT)

Citigroup Inc. (NYSE: C) traders will not longer use the chat feature on Bloomberg terminals as the scandal over journalist access to data grows. (FT)

U.S. farm land prices grow sharply despite weak demand for wheat. (FT)

Monthly car sales in Europe rise for the first time in 19 months, mostly on strength in Germany. (Bloomberg)