Tuesday, June 7, 2011

General Economics

News                                                                                                                             
Bloomberg | Oil Rises; SocGen Sees 65% Chance OPEC to Raise Output Quotas
Crude rose, reversing earlier losses, amid speculation the Organization of Petroleum Exporting Countries may reduce supply in response to slowing demand.
WSJ | Obama to Lose Top Economic Adviser
Austan Goolsbee, chairman of the White House Council of Economic Advisers, will leave his position by the end of the summer, marking the latest shake-up in President Barack Obama's economic team.
Bloomberg | Oil Rises; SocGen Sees 65% Chance OPEC to Raise Output Quotas
Crude rose, reversing earlier losses, amid speculation the Organization of Petroleum Exporting Countries may reduce supply in response to slowing demand.
Market Watch | Housing market is ‘sobering,’ or it’s time to buy
Lower-priced homes lost their value at about three times the pace of homes at the higher end, MarketWatch’s Amy Hoak writes in her column today. In part, that’s because those were the homes that saw some of the steepest gains as the housing bubble inflated.
CNN: Money | Economy makes people sick, literally
Thirty-five percent of middle class Americans said they or someone in their household has experienced a physical symptom of stress related to the economy, according to a recent report by First Command Financial Services, a financial service provider.
WSJ | Regulatory Delay Stokes Unease Over Dodd-Frank
Banks, investors and companies are scrambling to cope with uncertainty caused by regulators' delays in fleshing out the Dodd-Frank financial-overhaul law, amid fears the holdup might disrupt the $583 trillion derivatives market and spark a wave of lawsuits.
National Journal | State Department Nears Final Stages of Oil-Sands Pipeline Assessment
The State Department is heading into the final stages of deciding on whether to issue a presidential permit expanding a controversial oil-sands pipeline between Alberta and the Gulf Coast, taking comments on its Supplemental Environmental Impact Statement until midnight on Monday.

Econ Comments                                                                                                             
Washington Post | Political labels Obama doesn’t deserve
This aspect of Obama’s is beginning to play a crucial role in his management of the economy. The fact remains, no matter what Obama says — and almost no matter what he does — the business community deeply feels that he is unsympathetic to them and their goals. They say all they want to do is make an (honest) buck, but to do that they need consistency, predictability and — it would be nice — a pat on the back.
Financial Times | When China becomes number one
How will it feel when China becomes the world's largest economy? WE may find out quite soon. A few weeks ago, the International Monetary Fund issued a report that suggested China would be number one within five years.
Politico | Obama's biggest deficit is time
Against that backdrop, one wonders why the Obama administration promised voteres that if this muddled collection of legislative goop was signed into law, unemployment would never rise above 8 percent.
CNBC | China Offical Warns Risks in 'Excessive' Holdings of US Assets
China should guard against risks from "excessive" holding of U.S. assets as Washington could pursue a policy to weaken the dollar, a senior official at the State Adminstration of Foreign Exchange said in comments published on Tuesday. The U.S. has taken an expansionary fiscal and monetary policy to stimulate economic growth and the U.S. may find it har to resist the policy temptatn of weakening the dollar abroad and pushing up inflation at home.
AEI | Feds to Biotech Firms: Shut Up
A federal judge sentenced the former head of the biotech compnay to six months of home confinemnet this spring and fined him $20,000. His offense? Issuing a single press release about a drug.
Bloomberg | What Paul Krugman Misses About 1937 Redux: Echoes
What it if it just keeps going? That’s the question Americans are asking as they consider last month's 9.1 percent unemployment rate, still so high 33 months after the crash of September 2008. Scholars of economic history are asking another question: Are we repeating 1937?
RCM | An Entirely Predictable Economic Dip
Contrary to the popular view among economists that currency devaluation is necessary during periods of economic hardship, debasement works against the very investment that drives company formation and job creation given the tautological reality that any returns on investment will come back in cheapened money.

Blogs                                                                                                                             
Mercatus: Neighborhood Effects | Great Myths of the Great Depression
The New Deal deficit spending helped boost the economy and bring the unemployment rate down to single-digit levels, but fear of deficits limited the scale of New Deal programs and caused Roosevelt to reverse course and cut back on spending in 1937, just as the economy was gaining momentum.
WSJ | Zombie Consumers May Chomp Into Growth
On Tuesday, the Federal Reserve is expected to report that consumer credit outstanding rose by $5.5 billion in April after a $6 billion increase in March. This is hardly an encouraging development. For one, much of the recent rise appears to come from record-high levels of student-loan debt, which will depress the spending power of the next generation of Americans.
WSJ: Real Time Economics | Most Americans Haven’t Planned for Retirement and Other Areas of Concern
The financial status of American households may be even darker than we thought.

Reports                                                                                                                         
AEI | Another Slowdown
It seems difficult to escape the conclusion that Greece will default on some of its debt, thereby destabilizing the debt markets in Ireland and other southern European countries, including Portugal, Spain, and even Italy.
Cato Institute | As Promised, Free Trade Agreements Deliver More Trade: Manufacturing Exports Receive an Extra Boost
As Congress and the administration decide the fate of pending free-trade agreements (FTAs) with Korea, Panama, and Colombia, advocates and opponents will likely point to the experience of other recent bilateral and regional trade deals to support their positions.

Health Care

News                                                                                                                             
Fiscal Times | Health Care Law Waivers Stir Suspicion of Favors
President Barack Obama's administration has granted nearly 1,400 waivers easing requirements of the new health care law, and some critics on the right say Obama is giving his political allies a pass from burdensome requirements everyone else will have to live with.
National Journal | Senate Democrats Push Medicare Talking Points
The Senate voted down the Republican Medicare plan last month, making clear what everyone knew already: The Medicare plan from Rep. Paul Ryan, R-Wis., would not pass in this Congress. But Democrats think they have found a winning talking point, especially after last month’s special-election victory by Democrat Kathy Hochul in a typically Republican New York congressional district. They have not stopped talking about Medicare since.

Econ Comments                                                                                                             
WSJ | ObamaCare's Next Constitutional Challenge
The Medicaid provision of the health law spells the death knell for competition among the states.

Blogs                                                                                                                             
AEI: American | The Advantage of Ryan’s Premium Support Over ObamaCare
Medicare generally prohibits “balance billing,” which means that a participating doctor can’t charge fees over and above what Medicare pays. That’s not such a big deal when the Medicare spending floodgates are wide open. But when Medicare starts cutting back on what it will pay doctors and prescribing the types of treatments that work best, it’s a problem.
Econlog | Gorman on Attendant Services Under Medicaid
Health economist Gorman takes on the "Iron Triangle" idea that in health care you can achieve at most two of the following three goals: high quality, universal access, and cost containment. She examines the empirical literature on experiments in Medicaid provision of attendant services for people who are disabled.
Café Hayek | A Question for Single-Payer Proponents
I have a question for anyone who believes that a single-payer health-care system (where the single payer is government) will reduce the quality-adjusted cost of health-care: will a single-payer pet-food system (where the single-payer for pet food is government) reduce the quality-adjusted cost of pet food?
Cato @ Liberty | That’s Not Healthy: Even Krugman Admits Medicare Is a Lousy Program
Paul Krugman gets Medicare vouchers all wrong, but at least he begins with the premise that Medicare is a lousy program.

Taxes

News                                                                                                                             
Washington Times | ROOT: Is Obama committing tax fraud?
Similar behavior in the private sector would earn prosecution.

Econ Comments                                                                                                             
AEI | Corporate Tax Burden on Labor: Theory and Empirical Evidence
Distribution tables allow policymakers to assess where the burden of taxation falls among taxpayers with different income levels and other characteristics.

Blogs                                                                                                                             
NRO: The Corner | The Questionable Tax Martyrdom of the Super-Rich
First, there is something unseemly about the idea that super-millionaires should be setting tax policy for the rest of us.

Monetary

News                                                                                                                             
Bloomberg | Euro Gains to One-Month High on Greece Debt Optimism; U.S. Stocks Advance
The euro rose to a one-month high against the dollar as European Central Bank President Jean- Claude Trichet signaled he may back Greek debt rollovers. U.S. stocks rebounded after a five-week slump left the Standard & Poor’s 500 Index at its cheapest earnings valuation of 2011.
Fox News | Bernanke to take spotlight and assess economy
Investors have pushed stock prices lower for four straight days in response to data showing weaker hiring in May, falling home prices and a drop in manufacturing. On Tuesday, the Federal Reserve chairman will offer his outlook.

Econ Comments                                                                                                             
Forbes | China Inflation: The Canary In the Coalmine
The real inflation story is here in the United States.

Employment

News                                                                                                                             
WSJ | Alabama County Aims to Slash 33% of Workers
The county's finance committee will meet Tuesday to discuss the possibility of $12.3 million in budget cuts, which would include 697 layoffs, Commissioner Jimmie Stephens said.
CNN Money | Shrink federal workforce by 10%: House GOP
As aging workers retire, hire fewer replacements. And that's exactly what three House Republicans want the federal government to do.
Washington Times | With nurse shortage looming, America needs shot in the arm
At a time when many Americans are in desperate need of a job, the field of nursing will soon be in desperate need of Americans.

Econ Comments                                                                                                             
NY Post | The scary truth behind the new jobs numbers
In order to come up with growth of 54,000 new jobs the Labor Department had to assume the unlikely -- that 206,000 jobs were created by newly-formed companies it thinks but can't prove were "born" in May.
Washington Times | RAHN: How to create jobs now
Employment rises only when government spending declines.
Barron's | How Long Will Profits Rise at Labor's Expense?
The top editor at Bank Credit Analyst sees corporate profit margins peaking.

Blogs                                                                                                                             
Political Calculations | Updated: Major Trends in U.S. Layoffs
We now have enough data to be able to project the direction of the newest trend in U.S. layoff activity.
Bankrupting America | NEW VIDEO: is Washington creating our jobs crisis?
As Washington continues to spend far beyond its means, uncertainty about the future of our economy is stifling the ability of businesses to plan for the future.

Budget

News                                                                                                                             
Bloomberg | Flaherty Looks to Operating Cost Cuts For Balanced Canada Budget in 2014
Canadian Finance Minister Jim Flaherty, whose Conservative Party won a majority in last month’s election, is counting on cuts in government operating costs and the elimination of tax loopholes to balance his budget within four years.
CNN Money | Meredith Whitney: State finances are worse than estimated
The outspoken municipal bond bear follows up with more evidence that the fiscal troubles in many states are far greater than we've been told.
NY Times | In State Parks, the Sharpest Ax Is the Budget’s
As the summer season gets under way, budget-strapped state parks across the country are pursuing creative and sometimes controversial solutions simply to stay open.
WSJ | EU Faults States' Budget Plans
The European Union's executive arm said Tuesday that national economic plans presented by member states broadly reflect agreed policy goals but frequently lack ambition and concrete details.

Econ Comments                                                                                                             
Washington Times | EDITORIAL: Debt-limit clock ticking
Conservatives remind House leadership of need for real spending cut.
WSJ | Obama and the Debt Crisis
To lead us out of it, he will need to learn some new political skills.

Blogs                                                                                                                             
Heritage Foundation | Cut, Cap, and Balance
The debt limit is expected to be considered by both chambers of Congress by August 2. House conservatives have drawn up a list of demands in consideration for allowing the debt limit to be increased.