Tuesday, April 26, 2011

General Economics

CNN Money | State retiree benefits gap grows to $1.26 trillion
States are $1.26 trillion in the hole when it comes to their pension and retiree health obligations, according to a report released Tuesday.
CNN Money | Home prices near 'double dip'
Home prices in February sank 3.3% to just above the post-crisis lows reached in April 2009. It was the eighth straight month of declines.
CNN Money | Is the economy losing its mojo?
Inflation took a big bite out of the recovery in the beginning of the year, according to the latest forecasts, which have plummeted over the last several weeks.
National Journal | Frank: Cut Defense Budget, Reexamine NATO
Financial Services chair talks debt ceiling and military spending.
Yahoo | Oil slips as dollar gains, gasoline up for 34th straight day to $3.86 per gallon
The price of crude oil was stable Monday, dipping one cent to settle at US$112.28 per barrel on the New York Mercantile Exchange as the U.S. dollar pulled back from lows set earlier in the day..

Econ Comments                                                                                                             
RCM | Let's Put to Bed the 'America Is Bankrupt' Myth
To read economic and political commentary with any kind of frequency is to be bombarded daily - and hourly for that matter - with breathy articles about a United States groaning under deficits that surely signal bankruptcy, Social Security checks that eventually won't clear, and of course a looming financial crisis. A recent New York Times column by noted deficit scold David Stockman naturally referenced America's "desperate" financial situation.
NRO | In Search of Petrovillains
The Delegator-in-Chief has announced the creation of yet another inert task force, this one forced upon the attorney general and tasked with examining the role of “traders and speculators” in skyrocketing gasoline prices.
NRO | The Welfare State and the Selfish Society
Capitalism teaches people to work harder; the welfare state teaches people to want harder. Which is better?
AEI | Even US Can't Afford Generous Defined Benefits Systems
The defined benefit is dying. Barack Obama is struggling to keep it alive, but it's apparent that it's something that even as bounteously rich a society as ours can't afford.

Reason | The Myth of Homeownership Wealth Creation
Homeownership is a decent savings account that grows with inflation, but it is not a wealth builder as many believe
Minyanville | Lasting Effects of Japan's Earthquake on China, Global Economies
Expect to see some downside surprises in China's PMIs as a result of a trade slowdown with Japan.
WSJ: Real Time Economics | Economists React: New Home Sales
New home sales rebounded 11% in March from the record-low they plumbed a month earlier. The number of new homes on the market slipped to 183,000, the lowest level since 1967 – but so few new homes are being sold it would still take more than 7 months to exhaust that supply. Economists react:
The Atlantic | What a Crisis Looks Like
There's been some discussion over the last few days of what is going to happen if China starts reducing its position in US Treasuries.  Seeking Alpha has a good summation of the problem:
Café Hayek | Will Wilkinson on Paul Krugman
Agree with him or not (I nearly always do agree with him), the Economist‘s Will Wilkinson is unfailingly worth reading and pondering.  His latest essay is an excellent example.
WSJ: Real Time Economics | How Gasoline Price Hikes Affect Buying Choices
A dollar is a dollar. So if rising prices cut into our purchasing power, textbook economics suggests that we’d carefully weigh all our buying decisions to determine where to cut back, and by how much.
The American | Green Energy: Don’t Envy Germany
Germany’s promotion of renewable energies is commonly portrayed as setting a standard for the rest of the world. It is instead a cautionary tale.

RCM: Wells Fargo | New Home Sales Jumped in March, but Still at Low Level
New home sales rose 11.1 percent in March to a 300,000-unit annual pace. Previous months’ data were upwardly revised by a net 32,000 units. Median and mean home prices both fell on a year ago-basis.

Health Care

National Journal | Vermont Closing In on Single-Payer System
The Senate gave preliminary approval Monday to create a government-run health care system that Democratic Gov. Peter Shumlin advocated during his election campaign in 2010. The bill, a version of which already passed the state House, would give Vermont a Canadian-style health care system by the end of the decade.
National Journal | Lobbyists See a 'Second Doc-Fix' With Health Law's Medicaid Pay Bump
Physician groups are asking lawmakers to make indefinite a temporary increase in Medicaid payments, according to several sources involved with the discussions.

Econ Comments                                                                                                             
Politico | Don Berwick: Paul Ryan's plan is real rationing
The man Republicans have derided as the “rationer-in-chief” charges that Republicans’ own budget proposals would end up rationing care to millions of Americans on Medicare and Medicaid.


CNN Money | America's richest tax breaks
Today, there are dozens of tax credits, deductions and exclusions that cost federal coffers more than $1 trillion a year. That's a little more than a third of all annual federal spending.

Econ Comments                                                                                                             
Washington Times | NUGENT: Punishing the producers
Obama’s class-warfare strategy will only make the deficit larger.

NRO: The Corner | The Internet Tax Threat Is Here Again
The issue is back and states are arguing, once again, for a way to put their hands on some of the cash made by out-of-state companies that sell you good and services on the Internet.

Heritage Foundation | A Rose by Any Other Name: Clarity on Tax Hikes
A tax hike occurs when, as a consequence of a change in the tax law, total tax receipts are projected to be higher than they would be under current policy using traditional quasi-static scoring employed by the Treasury Department and by the congressional Joint Committee on Taxation.


CNN: Money | How the Fed has (and hasn't) fixed the economy
After the Federal Reserve announces its latest monetary policy decision, Chairman Ben Bernanke will have to face the media and answer for the Fed's actions.
Bloomberg | Fed Confidence in Transitory Inflation Hinges on Low Wage Gains
Brady Miller is paying more for vinyl siding for his construction business and for groceries to feed his family. He can’t charge customers more, showing why some Federal Reserve officials say inflation will ease.

Econ Comments                                                                                                             
Minyanville | Trading Chinese Stocks on Inflation Fears
As monetary policy tightening increases along with a rise in inflation, investors must pick their spots wisely.
WSJ | Bernanke's Inflation Paradox
The Fed said it wanted higher prices. Voila!
Minyanville | On Inflation and Money Illusion
Money illusion is a lot of fun until you realize that crisp new dollar bill is not worth the paper on which it is printed.


Fox News | GOP Eyes Debt Ceiling Vote for Leverage to Pass Balanced Budget Amendment
The last time a balanced budget amendment was introduced in the Senate, in 1997, it failed by just one vote.
WSJ | State Pension Plans Lose Ground
On average, state pension plans had 75% of the assets needed to cover the long-term benefits owed to government workers, based on fiscal-2010 data from 16 states obtained by Pew. That was down from 77% in those states in fiscal 2009.
Fiscal Times | Greece 2010 Deficit Bigger Than Forecast
Greece's deficit hit 10.5 percent of economic output in 2010, well above the 9.6 percent the European Commission, the EU's executive, predicted last fall.

Econ Comments                                                                                                             
Fortune | S&P: Why we downgraded our U.S. outlook
How does the rating agency decide when to downgrade its outlook for sovereign debt? It turns out that politics does influence the decision.
Washington Times | BLANKLEY: Only the Republican Study Committee budget would succeed
Small revisions to Medicare would yield big remedy to funding gap.
RCM | Cutting Expenditure Is A Good Thing
The U.S. faces a fiscal meltdown because government undertakes activities that are not necessary or useful functions of government. The only way to end our fiscal pain is for government to get out of these activities.
Washington Times | RAHN: Risky unrealism
Pie-in-the-sky budget forecast to end in pie with the face.
NRO | Debt-Ceiling Strategies
Republicans debate whether and how to raise the roof.