News
WSJ | Obama Seeks New Pacific Influence
President Says 'We Are Here to Stay' at Start of East Asia Trip, but Beijing Challenges U.S. Role as Dominant Power.
USA Today | Foreclosure activity hit 7-month high in Oct.
More U.S. homes entered the foreclosure process in October than in the previous month, with Florida, Pennsylvania and Indiana registering among the largest monthly increases, new data show.
Market Watch | November UMich consumer sentiment rises to 64.2
The sentiment reading, which covers how consumers view their personal finances as well as business and buying conditions, averaged about 87 in the year before the start of the most recent recession.
WSJ | Euro-Zone Factory Output Falls
Industrial output fell 2% in September from August, more than reversing the prior month's gain of 1.4% and marking the biggest drop since February 2009, the European Union's statistics agency Eurostat said Monday.
Source | Rate on 30-year mortgage below 4% for 2nd time in history
The average rate on the 30-year fixed mortgage fell below 4% last week. It's only the second time rates have ever dipped that low.
WSJ | Japan Economy Rebounds From Earthquake
The Japanese economy grew at a brisk 6% annualized rate in the July-September period, as strong rebounds in exports and consumption helped fuel a recovery from the massive dislocations caused by the March 11 earthquake and tsunami.
USA Today | Record exports trim September trade deficit to $43 billion
The U.S. trade deficit fell in September to the lowest point this year as foreign sales of American-made autos, airplanes and heavy machinery pushed exports to a record high.
Econ Comments
Washington Times | DOAK: Insurance oversight overkill
New federal office interferes with efficient state insurance regulation.
RCM | What's At Stake In the Net-Neutrality Fight
Two fundamental issues lie at the heart of the contentious battle over the Federal Communications Commission's (FCC) attempt to establish "network neutrality" regulations over the freewheeling Internet. Freedom of speech is not one of them.
WSJ | Japan's Third Opening
Trans-Pacific trade talks can force domestic economic reform.
Washington Post | Housing woes won’t yield to quick fix
We Americans think of ourselves as problem-solvers, but the housing collapse has so far eluded all solutions. Perhaps 10 million homes have gone into foreclosure since 2006; millions more will follow.
Barron's | Less Recession Risk, With Caution
There are some glimmers of hope, but the economic misery still looks like it will be prolonged. A real jobs uptick in 2015?
Politico | Let states regulate fracking
Too often, Washington ignores the complexities inherent in our vast and diverse nation and reverts to a one-size-fits-all approach in which Washington “knows” best.
WSJ | The EPA's Reliability Cover-Up
Why did the agency erase its own doubts about the U.S. electrical grid?
WSJ | Why China Is Unhappy
Rising discontent is challenging Communist Party rule.
Washington Times | DECKER: Obama: China’s stooge
President blames America while running economy into the ground
Source | Whatever Happened to Discipline and Hard Work?
In the future, complaints about income inequality are likely to grow and conservatives and libertarians won’t have all the answers. Nonetheless, higher income inequality will increase the appeal of traditional mores — of discipline and hard work — because they bolster one’s chances of advancing economically.
Morningstar | China's Unsustainable Investment Boom
The country has to boost household consumption to maintain heady GDP growth.
Blogs
Calculated Risk | Schedule for Week of Nov 13th
Two key housing reports will be released this week: November homebuilder confidence on Wednesday, and October housing starts on Thursday.
Reuters | Reuters Europe’s necessary creative destruction
What we’re seeing in Europe — in rising Italian borrowing costs and the felling of two prime ministers — is the growing impatience of the markets for a resolution to the euro zone crisis.
Econlog | Mark Thoma: Government Welfare Programs Have no Effect on Incentives
The poverty rate was declining fairly steadily before President Johnson, in 1965, started his so-called Great Society programs and increased government transfers to low-income people. Since then poverty has declined, but more slowly.
Calculated Risk | If Europe is in a recession, how about the U.S.?
If we look at the channels of contagion, it seems the impact from Europe – barring a blow-up – will be fairly small. Of course, with sluggish growth, the U.S. is very susceptible to economic shocks, and it also appears that the U.S. is moving to more austerity in 2012 – and that is an additional concern.
NY Times | What Percentage Lives in Poverty?
Do poor people represent the bottom 16 percent of the population or the bottom 15 percent? The answer matters more than you might think.
Calculated Risk | Calculated Risk Unofficial Problem Bank list declines to 981 Institutions
Another quiet week for the Unofficial Problem Bank List. The list includes 981 institutions with assets of $405.9 billion after two removals.
Source | What we’ve learned from the euro crisis, part I
It is a disaster and a dead-end situation when a country uses its automatic stabilizers in a manner which supports rent-seeking and harms growth. There is, in a time of crisis, no way out of the resulting trap.
Atlantic | The Limits of Risk Engineering
Regulators bear much of the responsibility. Before 1999, when Europe forged its monetary union, regulators permitted banks to treat as risk-free the debt of any country that belonged to the Organization for Economic Cooperation and Development, a club of developed nations that includes the United States and most of Europe.
WSJ: Real Time Economics | Number of the Week: What If Rest of World Had as Many Cars as U.S.?
4.5 billion: Additional cars, trucks and buses on the world’s roads if every place had the same number of vehicles per capita as the U.S.
NRO: The Corner | NRO: The Corner Special-Interest Politics and Regulatory Complexity
Over at Mother Jones, Kevin Drum has a piece where he says, essentially, companies may complain about complex regulations but the truth is that they love them, because they can use complex regulations to their advantage when competing with other businesses. In fact, Drum argues, companies lobby hard to turn simple rules into complex ones:
AEI:The American | AEI:The American The chart that shows America’s vulnerability to a EU financial crisis
What would happen to the U.S. economy if the EU’s debt problems dramatically worsened? The collapse of MF Global certainly raises concerns that policymakers might not have a good handle on risk.
Reports
Philadelphia Fed | Philadelphia Fed Supply-Side Policies and the Zero Lower Bound
This paper examines how supply-side policies may play a role in …ghting a low aggregate demand that traps an economy at the zero lower bound (ZLB) of nominal interest rates. Future increases in productivity or reductions in mark- ups triggered by supply-side policies generate a wealth e¤ect that pulls current consumption and output up.
