News
Market Watch | Consumer confidence plunges as hope dims
Consumer confidence plunged in August as expectations dived, with worsening views on future business conditions, jobs and income.
CNN: Money | Bank of America still not out of the woods
Days after receiving $5 billion vote of confidence form the legendary investor, the list of opponents to BofA's proposed $8.5 billion settlement with investors in mortgage-backed bonds continues to grow.
Market Watch | Home prices edge up 1.1% in June: Case-Shiller
Prices rose 1.1% during June from May but are down 4.5% over the past year, according to the closely followed S&P/Case-Shiller 20-city composite home price index.
Econ Comments
WSJ | Who Would Bail Out the European Central Bank?
The ECB has been 'talking its book' by opposing sovereign debt restructurings.
Financial Times | Struggling with a great contraction
What has the market turmoil of August been telling us? The answer, I suggest, is three big things:
Cato Institute | Yes, It Is a Ponzi Scheme
Social Security, forces people to invest in it through a mandatory payroll tax. A small portion of that money is used to buy special-issue Treasury bonds that the government will eventually have to repay, but the vast majority of the money you pay in Social Security taxes is not invested in anything.
WSJ | Mere Proposals
Among the core assumptions of modern liberalism is that future regulations have no more effect on the economy than future taxes, as if expectations don't matter and businesses don't prepare now for their costs tomorrow.
Forbes | Paul Krugman Demands More From Hurricane Irene: A Satire
Paul Krugman lamented as Hurricane Irene failed to live up to its economic potential. “Compared to the utility of preparing for an alien invasion the massive destruction and subsequent rebuilding that would have occurred had Irene become the Storm of the Century could have provided a much needed boost to the ailing economy.”
Blogs
Café Hayek | The Microeconomics of the Broken Window Fallacy
The Keynesian defense of breaking windows or the economic virtues of hurricanes would go something like this:
Calculated Risk | Recession Measures
Here is an update to four key indicators used by the NBER for business cycle dating: GDP, Employment, Industrial production and real personal income less transfer payments.
Café Hayek | Finding ways to raise costs and make us poorer
So why does Apple, for example, outsource so much of its production? Because it’s cheaper and it allows more people to be able to afford more Apple products. Making stuff the cheapest way is the road to prosperity.
Reports
RCM: Wells Fargo | Consumer Confidence Tumbles in August
Uncertainty surrounding the debt-ceiling agreement, the S&P downgrade and a shaky stock market pulled consumer confidence down 14.7 points in August, with reduced expectations accounting for most of the drop.
Mercatus Center | No Such Thing as Shovel Ready
Since 2008, support for effective fiscal stimulus has been premised on the belief in the existence of hundreds of billions of dollars worth of what became popularly known as "shovel-ready projects." These infrastructure construction and improvement projects would simultaneously lower unemployment, provide value to taxpayers, stimulate private sector growth, and begin in 90 days of less.
