Wednesday, November 30, 2011

General Economics

CNN: Money | S&P downgrades 15 banks
Standard and Poor's downgraded the credit ratings of 15 banks Tuesday, after applying new criteria to the world's 37 largest banks.
USA Today | New businesses gamble on the economy
Who would start a business in this economy?
CNN: Money | A French downgrade could derail eurozone rescue
In what would be another blow to Europe's beleaguered rescue fund, there is growing speculation that France will eventually lose its top-tier credit rating.
Market Watch | Third-quarter productivity lowered to 2.3%
U.S. workers were not as productive in the third-quarter as originally believed, according to revised government data.
CNN: Money | Solar power bankruptcies loom as prices collapse
The once high-flying solar power sector is headed for tough times, as a combination of slack demand and massive oversupply is leading to plummeting prices and profits for solar panel makers.
USA Today | Gas prices hit lowest mark since February
Gasoline prices have dropped to their lowest level since Feb. 21 in the government's latest weekly survey.
CNN: Money | Home prices fall to 8-year lows
Home prices dropped 3.9% year-over-year during the three months ended Sept. 30, according to the S&P/Case-Shiller national home price index. On a quarterly basis, prices were slightly higher, squeezing out a 0.1% gain.
Washington Times | GOP seeks to head off NLRB rules
Would speed up organizing process, allow multiple unions.
New York Times | Line Grows Long for Free Meals at U.S. Schools
The number of students receiving subsidized lunches rose to 21 million last school year from 18 million in 2006-7, a 17 percent increase.
WSJ | Bill Eases U.S. Residency for Foreign Skilled Workers
The House of Representatives passed a bill Tuesday to make it easier for skilled workers to get green cards, a measure that particularly affects employers who want to hire Chinese and Indian nationals

Econ Comments                                                                                                             
WSJ | A Political Solution for the Euro?
Germany is right to demand that the worst-run nations submit to fiscal discipline in exchange for financial aid.
CNN: Money | Consumers feeling rosier about the economy
The Consumer Confidence Index shot up to 56.0 in November from 40.9 the previous month, the Conference Board reported Tuesday, the highest reading since July.

NRO: The Corner | A Better Cause for OWS: Old vs. Young
Whether young people realize it or not, the reason most lawmakers won’t touch Medicare is because they know that older Americans vote.
Flowing Data | Four degrees of separation
We found that six degrees actually overstates the number of links between typical pairs of users:
Daily Capitalist | A Note On GDP
The BEA’s numbers, the national income and product accounts (NIPA), are constantly revised to adjust their measurement of the economy. The last revision came out in August and they make some observations about their understanding of the business cycle aside from the data revisions themselves:
Econlog | Credit Rating Agencies and Risk
Suppose that a rating for a security is a measures how far the default option is out of the money. Buyers of securities can make whatever use they like of this measure. But does it help regulators?
Calculated Risk | CoreLogic: 10.7 Million U.S. Properties with Negative Equity in Q3
The top five states combined have an average negative equity ratio of 41.4 percent, while the remaining states have a combined average negative equity ratio of 17.6 percent.
Café Hayek | Important Perspective on Imports
If we were to completely eliminate tariffs on imports, U.S. manufacturers relying on foreign inputs would receive significant benefits, while other U.S. manufacturers competing against imports would be less protected from foreign competition.

NBER | The Composition and Draw-down of Wealth in Retirement
This paper presents evidence on the resources available to households as they enter retirement. It draws heavily on data collected by the Health and Retirement Study and calculates the "potential additional annuity income" that households could purchase, given their holdings of non-annuitized financial assets at the start of retirement.
CRS | CRS An Overview and Analysis of H.R. 3010, the Regulatory Accountability Act of 2011
This report begins by providing a brief overview of the major requirements of the rulemaking process currently found in statutes, executive orders, and OMB documents, many of which would be changed or enacted into law by the proposed RAA. The report then discusses the RAA's proposed changes to these existing rulemaking requirements, providing a side-by-side comparison of the requirements of the RAA to these existing provisions.

Health Care

National Journal | Three-Fourths of U.S. HIV Patients Get Incomplete Treatment, CDC Says
The finding is ironic given that U.S. and global officials now see treatment as key to helping suppress the AIDS pandemic.
National Journal | Senate Republicans Cold to War Funds for Doc Fix
Senate Republicans were cold on Tuesday to the idea of using funds earmarked for winding down the wars in Afghanistan and Iraq to fix Medicare doctors’ pay and other year-end tax items.


USA Today | Major plan to save euro will have to wait for heads of state
Under pressure to deliver shock treatment to the ailing euro, European finance ministers failed to come up with a plan for European countries to spend within their means.
Bloomberg | Fed Lowers Interest Rate on Dollar Swaps
The Federal Reserve cut the cost of emergency dollar funding for European banks as part of a globally coordinated central-bank response to the continent’s sovereign-debt crisis.

Econ Comments                                                                                                             
Washington Times | GULLASON: Mixing fiscal and monetary policies
Routing maturing Treasuries to reduce state sales taxes could jump-start jobs.
Market Watch | Fed's Yellen sees room for more easing
There is room for the Federal Reserve to do more to foster a stronger economic recovery, said Federal Reserve Vice Chairman Janet Yellen on Tuesday. "The scope remains to provide additional accommodation," Yellen said in a speech at a conference sponsored by the San Francisco Fed.

WSJ: Real Time Economics | Fed’s Lockhart Skeptical New Asset Buying Would Help
Expanding the Federal Reserve balance sheet via new purchases of bonds isn’t the tonic the economy needs right now, even as European financial woes threaten the outlook for the U.S., a central bank official said Tuesday.


CNN Money | Payroll tax cut problem: Paying for it
After a year of beating their heads against the wall about reducing deficits, lawmakers in the next few weeks may add to them.
NY Times | In Congress, Role Reversal Over Federal Payroll Tax Cut
In a sharp role reversal, Democrats and Republicans have become divided over whether to extend a federal payroll tax cut enjoyed by every working American last year, with Democrats leading the charge for the tax break and many Republicans demanding that the cut be paid for if it is extended at all.
Politico | States cut taxes for 2012
The states put in place a net decrease of $584.2 million in new taxes and fees — the first in five years — compared with the increase $6.2 billion for fiscal 2011, according to the report by the National Governors Association and National Association of State Budget Officers.

Econ Comments                                                                                                             
Washington Times | LAMBRO: Bent out of shape over Bush tax cuts
Obama won’t budge from demand to dun the rich.
Cato Institute | High-Tax Advocates Are Either Credulous or Envious of Wealthy
President Obama said last week that we need to increase tax rates on the wealthiest Americans to obtain an extra $100 billion in tax revenue, and he blamed the failure of the supercommittee on the unwillingness of the Republicans to increase tax rates.
Washington Times | FOSTER: Repatriation tax holiday not a stimulus
America’s multinational companies are pushing hard for another repatriation tax holiday. Yes, pro-growth tax cuts and tax reform should be on Congress‘ agenda to get the economy moving again. But there are much better options than this jobs dud, starting with making the George W. Bush tax cuts permanent.

CRS | The Temporary Payroll Tax Reduction: A Brief Description and Economic Analysis
Social Security is financed by payroll taxes, which are paid by covered workers and their employers.1 In the absence of a payroll tax reduction, employees and employers would each pay 6.2% of covered earnings, up to an annual limit, whereas self-employed individuals would pay 12.4% of net self-employment income, up to an annual limit.


WSJ | Euro-Zone Unemployment Hits High
Some 16.294 million people in the euro zone were unemployed in October, a figure never equalled since records for all 17 nations were first compiled in January 1995. That is equivalent to 10.3% of the currency bloc's workforce—the highest percentage since June 1998.
Market Watch | Private-sector jobs rise 206,000: ADP
Growth in private-sector payrolls sharply accelerated in November, led by the service-producing sector and small businesses, according to the ADP employment report released Wednesday.

Heritage Foundation | Reduced Job Creation—Not Increased Layoffs—Explains High Unemployment
Unemployment remains stuck at 9 percent because of low job creation, not higher job losses. In fact, job losses hit a record low in March 2011. Fewer entrepreneurs are starting new companies, and fewer business owners are expanding existing enterprises.


Washington Times | EU nations offer Greece big bailout in currency crisis
Eurozone ministers offered Greece a $10.7 billion Christmas rescue package Tuesday to stem an immediate cash crisis, yet failed to resolve fears that the common euro currency might be doomed.

Econ Comments                                                                                                             
Reuters | Japan and the debt faith crisis: James Saft
Could Japan be the next victim of the crisis of faith in government bonds?
Cato Institute | After the Supercommittee?
Taxpayers just dodged a bullet. Even though Republicans on the so-called supercommittee were willing to break their promises and support a tax hike, a 1990-style budget deal was not possible because Democrats demanded too much and offered too little in exchange.
Roll Call | Deficit Hawks See Opening
With the super committee's failure last week, industrious lawmakers are grasping yet again at the opportunity to reach a sweeping deficit reduction deal — but they face the same obstacles that have crushed every group that's tried.
Forbes | Rich Nations That Went Broke By Spending Too Much
Government spending drives taxes, deficits, debt and inflation, so it’s at the core of our economic problems.  What to do about runaway spending? 
Daily Caller | America’s ‘shadow deficit’ looms larger than $15 trillion
Yet as the federal government continues blowing your money at an unprecedented, unsustainable rate, politicians from both parties continue refusing to make long-overdue cuts.
WSJ | Blame It on Berlin
The euro bailout caucus wants the Germans to write a blank check.
RCM | Bankruptcy Is An Ugly Option for Cities
Earlier this month the Harrisburg, Pa., city council threw itself on the mercy of federal bankruptcy court, hoping to find a less onerous solution to its debt woes than the workout plans proposed by the state of Pennsylvania and by the city's own mayor.

NRO: The Corner | Cutting Spending Is Good Politics
Over at U.S. World and News Report, Nancy Pfotenhauer has a good piece showing that cutting spending is not only good economics, it’s also good politics.
Atlantic: McArdle | How Can Europe Possibly Save Itself?
Well, things are getting a little gnarly in Europe.  When you're down to the point of celebrating that Italy managed to place some debt at the low, low price of 7.6% . . . well, it's two for one drinks specials at the first class bar on the Titanic!