Friday, September 2, 2011

General Economics

Econ Comments                                                                                                             
Financial Times | The big questions China still has to answer
China’s growth has been a source of strength in the crisis, but its leaders know their growth model is unsustainable.
WSJ | The Great Recession and Government Failure
When comparing the performance of markets to government, markets look pretty darn good.
Forbes | We Need A True, Comprehensive Audit Of The Fed
The Fed has been forced to open some of their books twice this year. Both times top Fed officials claimed that releasing their loan information to the public would cause “severe and irreparable competitive injury” to borrowing banks.
WSJ | In Government We Mistrust
Obama said he'd be Reagan in reverse. He was right.
Washington Times | RUSSELL & GLEASON: Perry’s ‘loser pays’ is an economic winner
New Texas law expected to reduce unjustified lawsuits.
Market Watch | U.S. said ready to sue big banks over mortgages
FHFA to seek billions; Fed reportedly eyes B. of A. contingency plan.
Politico | More business for small businesses
"One way to do this is to increase contracting opportunities for small businesses.
Small business contracting is smart contracting. These firms bring more competition and reduced prices, resulting in better value. Additionally, small business innovation, efficiency and flexibility allow the government to do more with less."

CafĂ© Hayek | I’m from the federal family and I’m here to help you
The federal “family” is not a family. It’s a faux family. A sham family. The government has neither the information nor the incentives to allocate goods wisely in the face of a shortage or a catastrophe. It should do less leaning forward and more sitting back.
ThinkMarkets | What is Economics Today?
I want to suggest that many threats to free markets come from “respectable” economics in today’s world. There are at least three major areas:
Daily Capitalist | U.S, EU Manufacturing Data Weak
Two very important manufacturing reports came out today: The ISM manufacturing report for the U.S., and Markit’s manufacturing PMI for the eurozone. Both reports showed substantial weakness in manufacturing.
Econlog | Keynesianism vs. Pump Priming
Keynesianism is widely seen as a "pump priming" rationale for government intervention. The government sees the economy in the doldrums, gives it a much-needed jolt, and then the private economy gets back on feet - with no need for further assistance.
WSJ: Real Time Economics | Vital Signs: Construction Slumped in July
Construction spending slumped in July. Total spending on construction fell 1.3% from June to $789.5 billion, at an annual rate. The decline was broad-based. Public construction fell 2.1% while spending on factories, hotels and other nonresidential projects slipped 0.4%.
ThinkMarkets | “A Divine Miracle”
Transfer payments in the guise of food stamps, unemployment benefits, and income redistribution generally have been the centerpiece of this administration’s policy to stimulate the economy.
WSJ: Real Time Economics | Global Manufacturing Slowdown Shows Every Nation Can’t Count on Exports for Growth
In the U.S. the new orders index showed orders falling for the second month in a row. Despite that, what seems to be helping American factories is a rebound in car sales and output after supply chain disruptions in Japan caused U.S.-based vehicle makers to cut production schedules in the spring and early summer.
NRO: The Corner | Much-Needed Regulatory Reform
I understand that lawmakers want to be perceived as doing something to fix our economic problems. So here is something lawmakers could do now to help the economy grow.

RCM: Wells Fargo | ISM: Slowdown—Not a Collapse, Easier Prices
U.S. manufacturing continues to slowdown as output and orders fell below breakeven but employment held up. Meanwhile, the moderation in prices paid suggests some relief ahead for input prices.
CRS | Revisiting Mortgage Loan Disclosures Under the Consumer Financial Protection Bureau
High default and foreclosure rates in the housing market have resulted in questions as to whether borrowers were fully informed about the terms of their mortgage loans. A lack of transparency with respect to loan terms and settlement costs can make it difficult for consumers to make well-informed decisions when choosing mortgage products. In addition, inadequate disclosures can make some borrowers more vulnerable to predatory lending or discriminatory practices.


Bloomberg | Treasuries Rise as U.S. Creates No Jobs in August, Potential Fed Stimulus
Treasuries rose as the government’s payrolls report showed no jobs were added in August, stoking speculation that the Federal Reserve may consider additional stimulus measures to boost the economy.
Market Watch | Fed governor calls for refi program changes
Changes should be made to the Obama administration’s existing housing refinance program to enable the participation of millions more underwater borrowers, Federal Reserve Governor Elizabeth Duke said in a speech on Thursday.

Marginal Revoultion | Should our government spend (and borrow) more at negative real interest rates?
Let’s say I could borrow money at negative two percent real, but my seven cousins, three of whom are crazy, would get together and decide how to spend it. I would get a vote too and they would agree to spend it on me. I would have to pay it back. I say no.

Health Care

National Journal | Doctors Still Giving Kids Too Many Antibiotics, CDC Says
More than half of all prescriptions written for children 14 and under are for colds, flu, and other respiratory infections – which are mostly caused by viruses and immune to antibiotics.
AEI | Can Progressive Approvals Cut Regulatory's Gordian Knot--and Stimulate Innovation?
The fundamental problem with the current system, Desmond-Hellmann observes, is that regulators have only two options, when in fact, it might make a lot more sense for them to have a range of choices.

Econ Comments                                                                                                             
Heritage Foundation | Wisconsin Study Reveals Obamacare “Winners and Losers”
Last week, the state of Wisconsin released a report summarizing the effects of Obamacare on the Badger State’s health care system. The study, which was conducted by Gorman Actuarial and MIT Economist Jonathan Gruber—an Obamacare supporter—and commissioned by former Governor Jim Doyle (D), provides further proof that Obamacare is on track to break the promises President Obama made to the American people regarding his plan for health care reform:


WSJ | Amazon Offers California-Jobs Plan in Exchange for Sales-Tax Reprieve
In the proposal, Amazon pledged to create 7,000 full-time jobs in the state by 2015.


WSJ | U.S. Economy Shows No Job Growth
Unemployment Rate Stays at 9.1% as Bleak Figures Raise Pressure on Washington to Act
CNN Money | White House: Slower jobs recovery ahead
The White House budget office forecast Thursday that the unemployment rate won't fall below 6% until 2017 -- two years later than it predicted in February, when President Obama delivered his 2012 budget proposal to Congress.

Econ Comments                                                                                                             
Washington Times | CREWS: Obama’s anti-jobs agenda
Midyear regulatory reform report card doesn’t look good.

WSJ: Real Time Economics | Government Cutbacks Spur More Layoffs
Governments cut a total of 17,000 employees last month after slashing 71,000 workers the prior month, the Labor Department said Friday.
NRO: The Corner | A PR Disaster for ‘Green Jobs’
First, in August, the New York Times printed an acknowledgement that the administration’s “green jobs” initiative — which the president promised would create 5 million green jobs over ten years — had failed.
Heritage Foundation | Labor Day 2011: Slideshow of Unemployment in America
America has the weakest labor market since the Great Depression. Unemployment remains above 9 percent, primarily because job creation hasn’t recovered
WSJ: Real Time Economics | Long-Term Unemployment Casts Doubt on Fed’s Ability to Help also means more expansive monetary policy won’t be as effective in curing what ails the labor market, Andreas Hornstein, Thomas A. Lubik and Jessie Romero argue in a new paper from the Federal Reserve Bank of Richmond.
Calculated Risk | Employment Summary, Part Time Workers, and Unemployed over 26 Weeks
There are a total of 13.967 million Americans unemployed and 6.0 million have been unemployed for more than 6 months. Very grim.
WSJ: Real Time Economics | Broader Unemployment Rate Rises to 16.2%
The comprehensive gauge of labor underutilization, known as the “U-6″ for its data classification by the Labor Department, accounts for people who have stopped looking for work or who can’t find full-time jobs.

NBER | Substitution Between Individual and Cultural Capital: Pre-Migration Labor Supply, Culture and US Labor Market Outcomes Among Immigrant Women
In this paper we use New Immigrant Survey data to investigate the impact of immigrant women’s own labor supply prior to migrating and female labor supply in their source country to provide evidence on the role of human capital and culture in affecting their labor supply and wages in the United States.


National Journal | OMB's Revised Budget Also Looks Optimistic The Office of Management and Budget expects the 2011 deficit to drop to $1.3 trillion, a 20 percent decrease from its February estimate of $1.645 trillion. OMB is not anticipating a double-dip recession.

Econ Comments                                                                                                              
Washington Times | BIRNBAUM: Having fiscal policy both ways Parties struggle to please voters with more spending and less spending.