News
WSJ | Collateral Damage Could Include Higher Mortgage Rates
Mortgage markets in the U.S., which remain on government life support, could be rattled by the downgrade of the U.S. credit rating, potentially raising borrowing costs for consumers.
CNN: Money | Rating downgrade: Did S&P get it right?
S&P is pessimistic. It points to the reckless debt ceiling debate, which artificially tied the longer term need to reduce the debt with the immediate need to raise the borrowing limit to ensure the United States makes good on all its bills.
Bloomberg | Central Bankers Confront Which Risk Scares Most
Central bankers from the U.S. to China may have to decide which is their worst nightmare: the Great Inflation of the 1970s or Great Depression of the 1930s.
CNN: Money | Moody's: Why we're not downgrading U.S. yet
Moody's said it expects the economy will improve and additional measures to reduce the budget deficit will be in place by 2013. The rating agency said this is why it reiterated its AAA rating for U.S. debt on Aug. 2, when the Senate agreed on a 10-year plan to reduce the deficit by more than $2 trillion.
NYT | Second Recession in U.S. Could Be Worse Than First
If the economy falls back into recession, as many economists are now warning, the bloodletting could be a lot more painful than the last time around.
Fox News | Congress has a shot at passing jobs-creating bills
With the battering debate over the debt ceiling over, the stage is set for Congress to approve and President Barack Obama to sign three big free-trade agreements and the most significant overhaul of the patent system in 60 years.
National Journal | Washington Week Round Table: A Tough Week for the Economy
The economy is the worst it’s been in years. Why and how did we get to this point? Also, with all the infighting in Washington these past 3-months, how did the debt deal come together and how will it effect the 2012 elections?
Econ Comments
Washington Times | MALPASS: Obama downgrade hurts
Act now to lessen impact before real pain starts.
Financial Times | America can fix its inner workings
At a moment of renewed financial market turmoil, a historic downgrade of US government debt and gathering signs that the recovery has stalled, the capacity of Washington to act with deliberation has seemingly collapsed.
Financial Times | Mission impossible: stop another recession
The first half of 2011 showed a slowdown of growth – if not outright contraction – in most advanced economies. Optimists said this was a temporary soft patch. This delusion has been dashed.
Blogs
Econlog | Manufacturing and Reality
The "problem" with manufacturing is mainly productivity growth that permits fewer workers to produce more goods. As workers are freed from having to produce common goods and services, total output expands greatly.
Calculated Risk | Schedule for Week of August 7th
The key reports this week are July Retail Sales on Friday, and the June Trade Balance report on Thursday.
WSJ: Real Time Economics | Making Sense of China’s Economic Statistics.
It used to be that when the U.S. sneezed the rest of the world gets a cold. Now the same is true of China. China is the biggest contributor to global growth, and it’s starting to have an equally important impact on the markets.
Heritage Foundation | Estonia’s Rebound Through Fiscal Discipline: A Message for America?
Estonia possesses a flexible, open economy and investment climate that encourages competition and economic growth. It remains one of the world’s freest economies.
Minyanville | Rise in Food Stamp Receipts May Confirm Economic Crash
The last time we saw an acceleration of this magnitude was in September 2008.
AEI: American | Obama’s European Economic Time Bomb
A wave of defaults is coming. This will badly damage Obama’s reelection chances.
Calculated Risk | Unofficial Problem Bank list declines to 988 Institutions
This is an unofficial list of Problem Banks compiled only from public sources.
Reports
RCM: Wells Fargo | Weekly Economic & Financial Commentary
Manufacturing activity slowed noticeably across the globe in July.
Heritage Foundation | Heritage Foundation U.S. Credit Rating Downgraded: Now They’ve Done It
While not solely to blame, President Obama and his allies are most certainly preeminently to blame. Facing a rapidly growing budget deficit in 2009, President Obama pushed through a massive fiscal stimulus program followed by a succession of lesser efforts. As the anemic state of the economy attests quite clearly, those programs failed miserably—except in raising federal spending and national debt.
CBO | CBO CBO's 2011 Long-Term Projections for Social Security
CBO's first infographic, released in conjunction with CBO's 2011 Long-Term Projections for Social Security: Additional Information, summarizes some of the agency's most recent projections for Social Security and provides background information on the program, including the number of beneficiaries and their distribution (among retired workers, disabled workers, and others), an explanation of how Social Security benefits are calculated, and a history of Social Security legislation since 1935.
Monday, August 8, 2011
Health Care
News
Politico | Tim Pawlenty changed tune on health care
Health care reform is supposed to be former Massachusetts Gov. Mitt Romney's Achilles heel in the Republican primary, and it may very well turn out to be. But one dynamic that's helped Romney so far is that some of his highest-profile critics on health care have in the past had positive things to say about elements of both the Massachusetts health care law and the Affordable Care Act, including the individual mandate.
Blogs
Heritage Foundation | Tele-med Abortions No Route to Making Abortion Either Safe or Rare
A new study says the growing practice of tele-medicine abortions, in which women are prescribed abortion-inducing medications without having a physician present, is “safe and successful”—but that declaration is dangerously deceitful.
Politico | Tim Pawlenty changed tune on health care
Health care reform is supposed to be former Massachusetts Gov. Mitt Romney's Achilles heel in the Republican primary, and it may very well turn out to be. But one dynamic that's helped Romney so far is that some of his highest-profile critics on health care have in the past had positive things to say about elements of both the Massachusetts health care law and the Affordable Care Act, including the individual mandate.
Blogs
Heritage Foundation | Tele-med Abortions No Route to Making Abortion Either Safe or Rare
A new study says the growing practice of tele-medicine abortions, in which women are prescribed abortion-inducing medications without having a physician present, is “safe and successful”—but that declaration is dangerously deceitful.
Taxes
News
Bloomberg | Coming Lobbyist Brawl May (Really) Fix Our Taxes: Jonathan Alter
Lobbyists, of all people, may soon inadvertently bring us what lobbyists have long fought against - - a flatter, simpler tax code that offers fewer gifts for special interests. As a bonus, it would also help bring down the deficit.
Roll Call | Deficit Panel Faces Tax Fight
Democrats and Republicans are already disagreeing about what they agreed to in the recently signed-into-law deal to raise the debt ceiling, and not surprisingly, taxes are at the heart of the dispute.
Reports
Mercatus | Tax Rates and Migration
The term “millionaire tax” does not necessarily mean a tax imposed only on individuals earning more than a million dollars per year. Depending on the state, landing in the top income tax bracket could require earning more than $1 million (New Jersey, Maryland, and California) or as little as $200,000 (Hawaii and Ohio) or even $150,000 (Arizona).
Bloomberg | Coming Lobbyist Brawl May (Really) Fix Our Taxes: Jonathan Alter
Lobbyists, of all people, may soon inadvertently bring us what lobbyists have long fought against - - a flatter, simpler tax code that offers fewer gifts for special interests. As a bonus, it would also help bring down the deficit.
Roll Call | Deficit Panel Faces Tax Fight
Democrats and Republicans are already disagreeing about what they agreed to in the recently signed-into-law deal to raise the debt ceiling, and not surprisingly, taxes are at the heart of the dispute.
Reports
Mercatus | Tax Rates and Migration
The term “millionaire tax” does not necessarily mean a tax imposed only on individuals earning more than a million dollars per year. Depending on the state, landing in the top income tax bracket could require earning more than $1 million (New Jersey, Maryland, and California) or as little as $200,000 (Hawaii and Ohio) or even $150,000 (Arizona).
Monetary
Market Watch | Gold soars above $1,700 after S&P downgrade
Gold prices soared to a record above $1,700 an ounce Monday as Standard & Poor’s downgrade of the U.S. credit rating amplified worries about the global economic outlook, attracting investors to the metal’s safe-haven status.
Gold prices soared to a record above $1,700 an ounce Monday as Standard & Poor’s downgrade of the U.S. credit rating amplified worries about the global economic outlook, attracting investors to the metal’s safe-haven status.
Budget
News
CNN: Money | Why government cuts won't hurt growth
S&P has a point: We need to cut more spending. Debunking the Keynesian argument that the forthcoming spending cuts will be a job and growth killer.
CNN | With downgrade, now can we get serious about debt?
Maybe out of this miserable moment we can refocus on how to "go big," and come up with reforms that are not only big enough to actually fix the problem, but expand the discussion to solve related problems as well. First, we will have to do much more to get our debt under control. Think $4 trillion to $5 trillion.
Fox News | Big Mandate, Low Expectations Greet 'Super Committee' on Debt Reduction
Members haven't been named yet, but appointees to the new congressional "super committee"" tasked with achieving at least $1.2 trillion in debt reduction by the end of the year will find their colleagues hopeful but not necessarily optimistic about the outcome.
Politico | A new chance to get budget right
This long-term structural imbalance is the biggest threat to our nation’s future — and the only way to confront it is to restrain entitlement growth while adding revenue. Two things Congress has been loath to do.
Econ Comments
Washington Post | The welfare state wins this budget war
Liberals got two of three. They failed on taxes, the Republicans’ litmus test. But they prevailed elsewhere. Social Security, Medicare and most benefits (food stamps, Medicaid) for the poor, regardless of age, were put off-limits.
Daily Caller | More government spending won’t fix sluggish economy
There he goes again. Out on the campaign trail, President Obama is proposing more federal spending as his answer to sluggish growth and jobs. That won’t do it, Mr. President.
Washington Times | MALPASS: Obama downgrade hurts
Act now to lessen impact before real pain starts.
Blogs
Forbes | The Wolf and The Lamb Deficit Plan
Did anyone really think that this Congress was capable of a real solution to the debt and deficit crisis? Certainly Standard & Poors didn’t think so.
Reports
Mercatus | Type the Title You Want People to See
The United States is not the first nation to wrestle with large and unsustainable national debt. Economists have identified a number of other instances in which wealthy, industrialized nations have taken on dangerous levels of national debt and have attempted reform.
Mercatus | Deficits, Debt, and Debasement
In President Barack Obama's first two years in office, it soared to $1.4 trillion in 2009 and $1.29 trillion in 2010. Deficits are on track to remain at unprecedented levels in 2011, and President Obama's promise to halve the deficit by 2012 turned out to be the same "politics as usual" that he denounced during his campaign.
CNN: Money | Why government cuts won't hurt growth
S&P has a point: We need to cut more spending. Debunking the Keynesian argument that the forthcoming spending cuts will be a job and growth killer.
CNN | With downgrade, now can we get serious about debt?
Maybe out of this miserable moment we can refocus on how to "go big," and come up with reforms that are not only big enough to actually fix the problem, but expand the discussion to solve related problems as well. First, we will have to do much more to get our debt under control. Think $4 trillion to $5 trillion.
Fox News | Big Mandate, Low Expectations Greet 'Super Committee' on Debt Reduction
Members haven't been named yet, but appointees to the new congressional "super committee"" tasked with achieving at least $1.2 trillion in debt reduction by the end of the year will find their colleagues hopeful but not necessarily optimistic about the outcome.
Politico | A new chance to get budget right
This long-term structural imbalance is the biggest threat to our nation’s future — and the only way to confront it is to restrain entitlement growth while adding revenue. Two things Congress has been loath to do.
Econ Comments
Washington Post | The welfare state wins this budget war
Liberals got two of three. They failed on taxes, the Republicans’ litmus test. But they prevailed elsewhere. Social Security, Medicare and most benefits (food stamps, Medicaid) for the poor, regardless of age, were put off-limits.
Daily Caller | More government spending won’t fix sluggish economy
There he goes again. Out on the campaign trail, President Obama is proposing more federal spending as his answer to sluggish growth and jobs. That won’t do it, Mr. President.
Washington Times | MALPASS: Obama downgrade hurts
Act now to lessen impact before real pain starts.
Blogs
Forbes | The Wolf and The Lamb Deficit Plan
Did anyone really think that this Congress was capable of a real solution to the debt and deficit crisis? Certainly Standard & Poors didn’t think so.
Reports
Mercatus | Type the Title You Want People to See
The United States is not the first nation to wrestle with large and unsustainable national debt. Economists have identified a number of other instances in which wealthy, industrialized nations have taken on dangerous levels of national debt and have attempted reform.
Mercatus | Deficits, Debt, and Debasement
In President Barack Obama's first two years in office, it soared to $1.4 trillion in 2009 and $1.29 trillion in 2010. Deficits are on track to remain at unprecedented levels in 2011, and President Obama's promise to halve the deficit by 2012 turned out to be the same "politics as usual" that he denounced during his campaign.
Employment
News
Bloomberg | Global Banks Poised to Cut 101,000 Jobs
The biggest global banks are cutting jobs at the fastest rate since 2008 as a weak U.S. economy squeezes revenue, regulators push firms to hold more capital and companies restructure businesses to improve profitability.
Econ Comments
WSJ | Five Ideas to Kick-Start Job Creation
Entrepreneurs don't want government money. They want the chance to invest their sweat equity.
Bloomberg | Global Banks Poised to Cut 101,000 Jobs
The biggest global banks are cutting jobs at the fastest rate since 2008 as a weak U.S. economy squeezes revenue, regulators push firms to hold more capital and companies restructure businesses to improve profitability.
Econ Comments
WSJ | Five Ideas to Kick-Start Job Creation
Entrepreneurs don't want government money. They want the chance to invest their sweat equity.
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