Thursday, June 2, 2011

General Economics

News                                                                                                                             
Politico | A different royalty plan for oil
For the second time in three years oil prices have stayed near or over $100 per barrel for months on end. This pain at the pump is not just hurting cash strapped motorists who can ill afford it. It is also incubation an inflationary trend that threatens fragile job creation and our economic recovery.
WSJ | Housing Imperils Recovery
Home Prices Sink to 2002 Levels; Consumer Confidence Falls as Pessimism Grows.
Market Watch | ISM manufacturing gauge tumbles in May
Growth in the U.S. manufacturing sector receded in May, owing to fewer orders and less production, according to a closely followed index.
WSJ | Economic Outlook Darkens
Markets Stumble as Factories, Hiring Slow Down; Biggest Drop in Stocks in a Year.

Econ Comments                                                                                                             
WSJ | Future Oil Supplies Can Lower Prices Today
We benefit now from more exploration, even if it takes years for new product to reach the market.
Washington Times | RAFUSE: Unilateral energy disarmament
Taking ‘fracking’ off the table would give foreign energy suppliers leverage.
WSJ | Obama's Cloud Economy
The economy is flying without instruments because of the White House's policy choices.
Daily Caller | Struggling economy is mre eveidence that government stimuli never work.
With a flamboyant downgrade of the outlook for economic growth, jobs and profits, Wednesday's 280-point Dow plunge to launch the so-called June stock swoon is a warning shot across the bow.
WSJ | Secretary of Subsidy
Obama's Commerce nominee knows all about corporate welfare.
RCM | U.S. Already In a Growth Recession
We know the president is busy, but maybe it's time he returned to thinking about our foundering, job-challenged economy.
WSJ | The Housing Illusion
Washington policies have only prolonged the pain.

Blogs                                                                                                                             
The Economist | How real is China's growth?
I'm now back from China, and I'm going to resist the temptation to draw grand, sweeping conclusions based on two weeks jaunting around the country. I will tell you some of my impressions, however. And I'll start with the primary question on my mind as I left to visit China: how real is its economic growth?

Reports                                                                                                                         
RCM: Wells Fargo | ISM: Slower Pace of Expansion, Yet Prices Remain an Issue
Moderation of the elevated level of the ISM index suggests growth in the factory sector is slowing, which is consistent with our GDP forecast of 1.8% in Q2. However, the cyclical upswing in prices remains a concern.

Health Care

News                                                                                                                             
National Journal | Could It Have Been Prevented? If So, Medicaid Won't Pay
“These steps will encourage health professionals and hospitals to reduce preventable infections, and eliminate serious medical errors," Centers for Medicare and Medicaid Services Administrator Donald Berwick said in a statement.
NYT | Report Finds Inequities in Payments for Medicare
Although Medicare is a national program, it adjusts payments to health care providers to reflect regional differences in wages, rent and other costs.
National Journal | Reid: Ryan Plan Would Eliminate Insurance to Millions of Children
Senate Majority Leader Harry Reid, D-Nev., laid into the Republican budget plan again on Tuesday, saying the proposal will take away health coverage not only from seniors, but also potentially from millions of children.
Politico | Health reform lawsuit in jeopardy?
A federal appeals panel questioned Wednesday whether a conservative legal center's challenge to the health law is still valid after the revelation last week that a key plaintiff had already bought health insurance.

Blogs                                                                                                                             
Cato@Liberty | Plaintiffs Should Be Cautiously Optimistic about Latest Obamacare Appeal
All in all, it was a fascinating day in court that proved again that no matter how much one studies the Obamacare challenges, there’s always something new to learn.
Econlog | Law, Legislation, and Medicare
Medicare, which has been around for most of our adult lives, has accustomed the elderly to the notion that they can have any medical procedure recommended by a doctor without having to pay for it. Any deviation from that custom would violate the law, in Hayek's sense. Hence, "government, keep your hands off my Medicare."
Cato@Liberty | Medicare Reform: Throwing Wasserman-Schultz ‘to the Wolves’
On CBS’s Face the Nation, Democratic National Committee chair Rep. Debbie Wasserman-Schultz (FL) said this of the House Republicans’ Medicare reform plan:

Monetary

News                                                                                                                             
Market Watch | Fed sees froth but no asset bubbles: Yellen
The Federal Reserve has detected a few markets exhibiting signs of froth that will require close scrutiny in coming months, but there are no signs of any significant asset bubbles at the moment, said Janet Yellen, the vice chairwoman of the U.S. central bank, in a speech in Tokyo on Thursday morning.

Econ Comments                                                                                                             
National Journal | Luetkemeyer: U.S. Could Go the Way of Greece
House Financial Services member also takes issue with U.S. holdings in Europe.
CNN: Money | The Fed's summer of discontent
QE2 is almost over. Our long economic nightmare? Not so much.
Minyanville | Yuan Is Not a Paper Shelter for a US Dollar Collapse
Because of China's ties to the US consumer, the yuan may not prove to be a worthy shelter if the dollar decline continues.
WSJ | Economy Needs a Borrower of Last Resort
A lack of funds isn't hampering the U.S. economy right now. It is a lack of demand for them.
RCM | Why Robert Mundell Is Wrong About the Dollar/Euro
Nobel Laureate Robert Mundell and his followers have made some noise of late about the need to achieve a fixed exchange rate between the dollar and the euro. About their desire for an exchange rate fix they're certainly correct, though they're wildly incorrect in suggesting that inflation and deflation can be cured if the U.S. Treasury simply ties the dollar to the euro.
Forbes | Inflation Won't Wait For The Banks
It is the existence of newly created money that hastens the dollar's decline.

Blogs                                                                                                                             
Marginal Revolution | The “New Monetary Economics” is alive and well
Although the term has fallen out of use, in the last three to four years the NME has made a big comeback, albeit not under that name:
Atlantic | Euro in Crisis
I've been making the argument for a long time--at least seven years in print, and in private before that--that the eurozone looks about as stable as the Unabomber.  Especially when you have a fiat currency, you need to think about what makes an optimal currency zone--the largest unit that can easily share a unit of money.

Employment

News                                                                                                                             
WSJ | Jobs Market Picks Up for Graduates
Financial-Services Companies, Consulting Firms Lead Hiring of M.B.A. Students After Declines.
MarketWatch | Economists rush to mark down payrolls estimates
Nonfarm increase for May pegged at 125,000 after midweek moves.
Bloomberg | U.S. Productivity Slowed in First Quarter
The measure of employee output per hour increased at a 1.8 percent annual rate after a 2.9 percent gain in the prior three months, revised figures from the Labor Department showed today in Washington.
MarketWatch | Applications for jobless benefits fall slightly
U.S. applications for unemployment benefits fell slightly last week, according to fresh government data, but new claims remained at a level typically associated with subpar hiring trends.

Budget

News                                                                                                                             
CNN Money | States' latest problem: Too much money
The windfall is setting off new rounds of budget battles between state lawmakers and governors, who not long ago were slashing and burning their programs and services.
NY Times | Improved Tax Collections Can’t Keep Pace With States’ Fiscal Needs, Survey Finds
Although state tax collections are picking up after several brutal years, a new survey by the National Governors Association and the National Association of State Budget Officers found that states still expect to collect less tax revenue and spend less money in the coming fiscal year than they did before the Great Recession began.
Politico | John Boehner calls for debt deal in a month
House Speaker John Boehner said he doesn’t want to run up against an August deadline for boosting the nation’s debt limit — fearing that it could unnerve Wall Street — but he’s refusing to back away from his calls for major spending cuts in return for a debt deal with the White House.

Econ Comments                                                                                                             
WSJ | In Praise of Debt Limit 'Chicken'
Yesterday 150 economists released a statement saying a higher debt ceiling should be tied to spending reform now.
Daily Caller | Limit debt before raising debt limit
Over the past two years, President Obama and Congressional Democrats have overseen the largest budget deficits in the history of the U.S.
WSJ | The Debt Limit Dance
Eighty-two Democrats, or nearly half of those present, also voted no on the plan favored by the Obama Treasury.

Blogs                                                                                                                             
Heritage Foundation | Discouraging Retirement Savings Is No Way to Reduce the Federal Deficit
Removing the tax preference for retirement plans in particular would do more harm than good.