Friday, August 22, 2014

General Economics

News                                                                                                                             
CNN Money | Bank of America to pay $16.65 billion over mortgages
The latest agreement settles probes by the Justice Department and six states that accused the bank of misleading the buyers of mortgage-backed bonds about the quality of the loans. The bank admitted responsibility, but the announcement did not include criminal charges.
Bloomberg | Too Much Corn With Nowhere to Go as U.S. Sees Record Crop
From Ohio to Nebraska, thousands of field inspections this week during the Pro Farmer Midwest Crop Tour show corn output in the U.S., the world’s top producer, could be 1 percent more than a government estimate and soybeans 1.2 percent higher, according to a Bloomberg survey of crop scouts.

Econ Comments & Analysis                                                                                            
Forbes | Dispelling The Myth of Corporate Cash Hoarding
The reality is corporations have a little more money than usual, but it is not because they are holding back on spending or hiring.
Real Clear Markets | Narrow Market Exits Today Are Of the 2007-2008 Variety
The huge declines in dealer volumes of corporate credit, the massive and incongruent MBS selloff of last year and now the repo fails in UST are not favorable signs for liquidity under relatively benign conditions.
National Journal | Why Are Women-Owned Businesses So Small?
Women own 30 percent of privately owned businesses but generate just 11 percent of sales, according to federal statistics.

Blogs                                                                                                                             
WSJ: Real Time Economics | Homes Built for Rent Claim Smaller Share
Recent Commerce Department data show that construction of single-family homes for rental purposes is shrinking toward its long-term average market share, but that doesn’t include the entire picture.

Health Care

Econ Comments & Analysis                                                                                            
Washington Times | Choosing a $10 medical test over a $10,000 one
The authors found an even greater range for the 178 California hospitals that reported the charge of a lipid panel. The median California hospital charged $220 for this test with a range of $10 to $10,169. Hence the maximum charge was more than a thousand times the minimum.

Monetary

News                                                                                                                             
Fox Business | Yellen: ‘No Simple Recipe’ for Gauging Tightening Timing
There is “no simple recipe” to determine whether the labor market has returned to normal, Yellen said in a highly anticipated speech in Jackson Hole, Wyoming, meaning the central bank will eye a slew of factors in deciding how to tighten its aggressive stimulus program.
CNN Money | Janet Yellen: Job market not recovered
The debate now is whether the job situation in America is healthy enough for the Federal Reserve to start raising interest rates, which have been at historic lows in recent years in an effort to jump start the economy. Yellen, however, said little new on Friday, and U.S. stock markets stayed flat.

Econ Comments & Analysis                                                                                            
WSJ | A Few Things the Fed Has Done Right
As Federal Reserve officials lay the groundwork for raising interest rates, they are doing a few things right. They need a little cheering, and a bit more courage of their convictions.
Bloomberg | Yellen Cites 19-Measure Labor Market Index: Jackson Hole Journal
Federal Reserve Chair Janet Yellen turned to a recently developed tool -- an index of 19 labor market indicators created by Fed staffers -- to help sum up her message on how monetary policy can respond to the state of the American worker: It’s complicated.
Bloomberg | Stanford’s Taylor Says U.S. Rate Rise Will Help Emerging Markets
The phasing out of the U.S. Federal Reserve’s monetary stimulus will help emerging markets by ridding them of a source of turbulence, according to Stanford University Professor John Taylor.

Blogs                                                                                                                             
Market Watch | Unemployment rate ‘thrown under the bus’ and more reactions to Yellen address
Her speech from Jackson Hole on Friday morning was read as hawkish by some and as dovish by others.

Taxes

Econ Comments & Analysis                                                                                            
Daily Signal | Sugar Consumption: A Taxable Sin?
A proposal now before Congress would add a one-cent-per-teaspoon tax on sugar to discourage sugar use and help fund programs to fight obesity and diabetes. Do you favor or oppose a sugar tax like this?
Mercatus Center | Sales Taxes and Exemptions
We analyze the equilibrium relationship between the sales tax rate and the number of sales tax exemptions in each state that levies sales taxes. Our theory suggests that as tax rates rise, so do lobbying activities, and therefore the number of exemptions.

Employment

Econ Comments & Analysis                                                                                            
WSJ | Unemployed by ObamaCare
Three new Fed surveys highlight damage to the labor market.

Blogs                                                                                                                             
WSJ: Real Clear Markets | Jackson Hole Study Authors See Lost Job Market Dynamism
A study to be presented Friday at the Kansas City Fed’s conference here in Jackson Hole, Wyo., raises questions about whether U.S. labor markets are actually all that dynamic.
WSJ: Real Clear Markets | There’s Nothing ‘Natural’ About Unemployment: Fed Conference Paper
Taking aim at the economics notion that there is a “natural” rate of unemployment below which inflationary forces will spiral upward out of control, Giuseppe Bertola, economics professor at EDHEC Business School, says the state of the job market depends heavily on policy choices.

Budget

Econ Comments & Analysis                                                                                            
Mercatus Center | The United States’ Debt Crisis: Far from Solved
In short, the United States’ fiscal outlook has not changed. Americans will soon have to deal with the consequences of being a highly indebted nation. While economists can’t predict exactly when or how a debt crisis will manifest itself in the United States, such a crisis is inevitable if current spending trends continue.