News
Bloomberg | ISM Services Expands at Slower Pace
Service industries in the U.S. expanded in November at the slowest pace since January 2010 as employment cooled, a sign improvement in the biggest part of the economy will be uneven.
Market Watch | Shale gas gives rise to era of energy independence
A boom in shale gas production in recent years has helped lift U.S. natural gas supplies to a record level, creating an ideal environment to sustain low prices and offering a launching pad for a new era in a country striving for energy independence.
WSJ | Euro-Zone Economy Shrinks
The euro zone's four largest economies all contracted in November, with German activity shrinking for the first time in two and a half years.
CNN: Money | Credit card use is on the rise
Purchases made with credit cards rose 8.2% in the first quarter of 2011, 9% in the second quarter and 10.6% in the third quarter, according to First Data. That compares with gains in debit card use of 9.6%, 8.3% and 5.9% for the same quarters.
Market Watch | Trade data to hint at U.S. economic difficulties
After a week of key employment and manufacturing-sector data, Wall Street can be forgiven for directing their focus away from the economic reports that come out of the Capitol this week and toward Europe ahead of key meetings there.
CNN: Money | Gasoline: The new big U.S. export
The United States is awash in gasoline. So much so, in fact, that the country is exporting a record amount of it.
USA Today | As home prices sink, home ownership heads to new lows
Home prices across the nation are right back where they were at the beginning of 2003. All that was gained is largely now lost, and the effect on home ownership could continue for decades.
CNN: Money | Europe goes back to the drawing board
European leaders will meet this week for yet another summit to discuss ways to save the euro, and this time they are talking about rewriting European Union treaties.
NYT | Secrets of the Bailout, Now Told
It is dispiriting, of course, that we are still learning about the billions provided to various financial firms during the crisis. Another sad element to this mess is that getting the truth requires the legal firepower of an organization as rich as Bloomberg.
Econ Comments
Cato Institute | Keynesian Policies Have Failed
Policymakers should ignore the Keynesians and their faulty models, and instead focus on reforms to aid long-run growth..
WSJ | Reworking The Workplace
Many companies that trumpet social responsibility have found it a useful tool for cutting costs and wooing customers.
NYT | Know What You’re Protesting
Perhaps the protesters were motivated by an inchoate feeling that standard economic theory is inherently slanted toward a conservative world view. If so, they would be following a long tradition.
Washington Post | The welfare state’s reckoning
We Americans fool ourselves if we ignore the parallels between Europe’s problems and our own. It’s reassuring to think them separate, and the fixation on the euro — Europe’s common currency — buttresses that mind-set.
WSJ | How Regulators Herded Banks Into Trouble
Blame the Basel capital standards for over-investment in mortgage-backed securities and now government debt.
Washington Times | BURR: Labor-relations agency goes rogue
NLRB contravenes own rules to boost unions.
City Journal | The Regulatory Thicket
No wonder small businesses, the engine of the U.S. economy, have stalled in hiring. Chamber of Commerce surveys show that over 60 percent of small businesses have no plans to hire in the next year, and the firms cite greater regulation or the threat of it as a major reason for their reluctance.
MSN: Money | Something's wrong with the economy
Forget Friday's misleading drop in the unemployment rate. The evidence is building that global growth has stalled. And it's about to get much worse.
Blogs
Econlog | The PSST Just-So Story
PSST emphasizes the effect of technology on employment. In any industry where productivity rises faster than demand, employment will decline.
Café Hayek | Applause for John D. Rockefeller
Rockefeller was kind, forgiving and tolerant of others’ faults, enormously generous, intelligent, prudent, loyal to friends and family, and never venal or petty or vindictive. His employees, from top to bottom, seemed genuinely fond of him.
Econlog | Econlog Greenspan on Dodd-Frank: Start Over
In his Friday talk at the Hoover Institution, Alan Greenspan advocated two policies. The second is to scrap the Dodd-Frank financial regulation law and start over. The law, said Greenspan, "is unimplementable."
Calculated Risk | Unofficial Problem Bank list unchanged at 980 institutions
Since the publication of the Unofficial Problem Bank List in August 2009, this is the first week there are no changes to report as the list remains unchanged at 980 institutions with assets of $400.5 billion.
Monday, December 5, 2011
Health Care
News
National Journal | Doc Fix' Once Again Squeezed to Short Term
It’s the most wonderful time of the year, except perhaps it’s the worst. Congress is once again facing down a hard deadline to avoid a 27 percent pay cut to Medicare doctors, and with only a few weeks left, the last hope is yet another short-term patch.
National Journal | Proposed Law: Decide Health Care Cases Now
Advocates on both sides of the case want the court to answer the cases' constitutional questions right away. But the Court could still decide to postpone the decision until 2015, if it finds that it doesn't have jurisdiction to consider the law now.
Econ Comments
Washington Post | Choking on Obamacare
In an economic climate of increasing uncertainties, Puzder says, one certainty is that many businesses now marginally profitable will disappear when Obamacare causes that margin to disappear.
WSJ | The ObamaCare Recusal Nonsense
The left doesn't want Justice Thomas to hear the case. The right says Justice Kagan is too biased. The full court should decide the case.
Blogs
Marginal Revolution | Claims about health care
The magnitudes of our empirical findings imply that changing provider incentives explain up to one third of recent growth in spending on physician services. The incremental care has no significant impacts on mortality, hospitalizations, or heart attacks.
National Journal | Doc Fix' Once Again Squeezed to Short Term
It’s the most wonderful time of the year, except perhaps it’s the worst. Congress is once again facing down a hard deadline to avoid a 27 percent pay cut to Medicare doctors, and with only a few weeks left, the last hope is yet another short-term patch.
National Journal | Proposed Law: Decide Health Care Cases Now
Advocates on both sides of the case want the court to answer the cases' constitutional questions right away. But the Court could still decide to postpone the decision until 2015, if it finds that it doesn't have jurisdiction to consider the law now.
Econ Comments
Washington Post | Choking on Obamacare
In an economic climate of increasing uncertainties, Puzder says, one certainty is that many businesses now marginally profitable will disappear when Obamacare causes that margin to disappear.
WSJ | The ObamaCare Recusal Nonsense
The left doesn't want Justice Thomas to hear the case. The right says Justice Kagan is too biased. The full court should decide the case.
Blogs
Marginal Revolution | Claims about health care
The magnitudes of our empirical findings imply that changing provider incentives explain up to one third of recent growth in spending on physician services. The incremental care has no significant impacts on mortality, hospitalizations, or heart attacks.
Monetary
News
WSJ | Federal Reserve Prepares to Make Itself Perfectly Clear
Federal Reserve officials are close to completing an overhaul of how they signal their policy plans to the public.
Econ Comments
Daily Caller | More cheap money won’t fix our economy
The lack of confidence in financial markets hasn’t dissipated since the Fed printed nearly $2 trillion, so why does anyone expect the latest, actually more modest central bank intervention to have any long-term effect?
Blogs
Market Watch | New currencies to lose value in euro breakup
Since people are worrying about the euro zone breaking up if leaders can’t agree on how to deal with the out-of-control debt of some countries, the next natural question is: so what’s that mean for returning to individual currencies?
WSJ | Federal Reserve Prepares to Make Itself Perfectly Clear
Federal Reserve officials are close to completing an overhaul of how they signal their policy plans to the public.
Econ Comments
Daily Caller | More cheap money won’t fix our economy
The lack of confidence in financial markets hasn’t dissipated since the Fed printed nearly $2 trillion, so why does anyone expect the latest, actually more modest central bank intervention to have any long-term effect?
Blogs
Market Watch | New currencies to lose value in euro breakup
Since people are worrying about the euro zone breaking up if leaders can’t agree on how to deal with the out-of-control debt of some countries, the next natural question is: so what’s that mean for returning to individual currencies?
Taxes
News
Market Watch | Reid said ready to compromise on payroll-tax cuts
U.S. Senate Majority Leader Harry Reid will offer a compromise on Monday to extend payroll-tax cuts and jobless benefits that would otherwise expire this month, another Democrat said Sunday.
Econ Comments
Daily Caller | Obamacare’s 21 tax hikes are killing jobs
Stryker, the Kalamazoo, Michigan-based manufacturer of a variety of medical devices including knee and hip replacements, announced last month that it was cutting roughly 1,000 jobs in anticipation of the 2.3 percent tax.
Bloomberg | Tax Cuts Seen Undermining Social Security
The lawmakers and advocacy groups say they’re concerned the tax cuts may undermine political support for the retirement program, which provides benefits to almost 55 million Americans and is funded by the payroll levies.
Blogs
Cato@Liberty | Revisiting the ‘Christmas Tree Tax’
Republicans who say they want smaller government should walk the talk by introducing legislation that would eliminate agencies and programs.
Market Watch | Reid said ready to compromise on payroll-tax cuts
U.S. Senate Majority Leader Harry Reid will offer a compromise on Monday to extend payroll-tax cuts and jobless benefits that would otherwise expire this month, another Democrat said Sunday.
Econ Comments
Daily Caller | Obamacare’s 21 tax hikes are killing jobs
Stryker, the Kalamazoo, Michigan-based manufacturer of a variety of medical devices including knee and hip replacements, announced last month that it was cutting roughly 1,000 jobs in anticipation of the 2.3 percent tax.
Bloomberg | Tax Cuts Seen Undermining Social Security
The lawmakers and advocacy groups say they’re concerned the tax cuts may undermine political support for the retirement program, which provides benefits to almost 55 million Americans and is funded by the payroll levies.
Blogs
Cato@Liberty | Revisiting the ‘Christmas Tree Tax’
Republicans who say they want smaller government should walk the talk by introducing legislation that would eliminate agencies and programs.
Employment
News
Bloomberg | U.S. Job Prospects at Three-Year High
A measure of job prospects in the U.S. climbed in November to a three-year high, helped by growth in the world’s largest economy.
CNN Money | Men best women in scramble for new jobs
The government's latest jobs report Friday showed a surprisingly large split between men and women. The unemployment rate fell for both groups, but for very different reasons.
USA Today | Millennial entrepreneurs bypass the unemployment line
Mehdi Farsi, Reza Farsi and Eric Ferguson didn't send out resumes seeking a corporate job after they graduated from Arizona State University a few years ago.
WSJ | Farmers Contest Child-Labor Rules
Some farmers are opposing new rules proposed by the federal government that would restrict the chores children can be hired to perform in the nation's fields, including driving tractors and rounding up cattle in corrals on horseback.
Econ Comments
WSJ | Below 9%
There are still six million fewer Americans working today than before the financial meltdown, making this by far the worst jobs recovery in modern times.
Market Watch | Job-creation ideas both parties can agree on
There are a handful of job-creation ideas that could appeal to those at both ends of the political spectrum if the will is there among lawmakers, economists say.
Blogs
Calculated Risk | Employment Summary, Part Time Workers, and Unemployed over 26 Weeks
Through the first ten months of 2011, the economy has added 1.448 million total non-farm jobs or just 131 thousand per month.
American: Enterprise Blog | November jobs report: 7 reasons why it’s better but still terrible
When the U.S. economy grows as slowly as this one has for the past year, history suggests there’s a 70 percent chance of recession happening in the upcoming year.
WSJ: Real Time Economics | Unexpected Unemployment Progress Muddies Fed Outlook
Over recent weeks, the comments of a key group of Federal Reserve officials have been leading financial markets to increase their expectations the central bank will provide additional stimulus to the economy at some point.
The Money Illusion | Two anecdotes and a complaint.
In the long run we should reform UI to give workers more “skin in the game”…
Political Calculations | A Four Year Milestone for U.S. Jobs
Four years ago, the number of employed Americans peaked at 146,584,000 in November 2007, just ahead of the U.S. economy itself peaking in December 2007, which marked the starting point for the nation's most recent economic recession.
Calculated Risk | Seasonal Retail Hiring, Duration of Unemployment, Unemployment by Education and Diffusion Indexes
According to the BLS employment report, retailers hired seasonal workers at close to the pre-crisis pace in November.
EconLog | Are These Recessions All the Same?
Here are some data on job losses in each recession since 1970 (I grouped together the two recessions in 1980-1982). I look at total losses in nonfarm payroll employment and losses in employment in the durable goods sector.
WSJ: Real Time Economics | Economists React: Something Good Stirring in the Economy?
Economists and others weigh in onthe increase in nonfarm payrolls and the drop in the unemployment rate.
Calculated Risk | Comments on the Employment-Population Ratio
...if the unemployment rate stayed steady, the employment-population ratio would follow the participation rate. This is important because the participation rate is impacted by changes in demographics…
Marginal Revolution | How much do unions matter?
The estimates suggest that about one quarter of the increase in the variance of log earnings from 1979 to 2009 can be accounted for by falling U.S. private sector unionization rates, a larger fraction than earlier studies have found.
American: Enterprise Blog | Why the plunging unemployment rate could mean the U.S. economy is broken
If trend GDP growth is 2.5 percent, and over the past year the economy grew at a 1.5 percent clip, then Okun’s Law predicts the unemployment rate would rise about half a percentage point.
WSJ: Real Time Economics | Did Economy Create Nearly 500,000 Jobs in November?
According to one little-followed measure, the economy created about 500,000 jobs last month — more than four times as many as the government’s official figure of 120,000.
Mercatus Center: Neighborhood Effects | Requiring Volunteer Work for Unemployment Benefits
Georgia’s historically high unemployment rate coupled with the fact that its unemployment trust fund has recently reached insolvency, has led law makers to reconsider the structure of their state’s unemployment system.
Reports
Heritage Foundation | Heritage Employment Report: November Jobs Not Quite a Feast
The sharp drop in the unemployment rate was a result of solid job growth in the household survey and also, worryingly, a large exodus of people from the workforce.
Bloomberg | U.S. Job Prospects at Three-Year High
A measure of job prospects in the U.S. climbed in November to a three-year high, helped by growth in the world’s largest economy.
CNN Money | Men best women in scramble for new jobs
The government's latest jobs report Friday showed a surprisingly large split between men and women. The unemployment rate fell for both groups, but for very different reasons.
USA Today | Millennial entrepreneurs bypass the unemployment line
Mehdi Farsi, Reza Farsi and Eric Ferguson didn't send out resumes seeking a corporate job after they graduated from Arizona State University a few years ago.
WSJ | Farmers Contest Child-Labor Rules
Some farmers are opposing new rules proposed by the federal government that would restrict the chores children can be hired to perform in the nation's fields, including driving tractors and rounding up cattle in corrals on horseback.
Econ Comments
WSJ | Below 9%
There are still six million fewer Americans working today than before the financial meltdown, making this by far the worst jobs recovery in modern times.
Market Watch | Job-creation ideas both parties can agree on
There are a handful of job-creation ideas that could appeal to those at both ends of the political spectrum if the will is there among lawmakers, economists say.
Blogs
Calculated Risk | Employment Summary, Part Time Workers, and Unemployed over 26 Weeks
Through the first ten months of 2011, the economy has added 1.448 million total non-farm jobs or just 131 thousand per month.
American: Enterprise Blog | November jobs report: 7 reasons why it’s better but still terrible
When the U.S. economy grows as slowly as this one has for the past year, history suggests there’s a 70 percent chance of recession happening in the upcoming year.
WSJ: Real Time Economics | Unexpected Unemployment Progress Muddies Fed Outlook
Over recent weeks, the comments of a key group of Federal Reserve officials have been leading financial markets to increase their expectations the central bank will provide additional stimulus to the economy at some point.
The Money Illusion | Two anecdotes and a complaint.
In the long run we should reform UI to give workers more “skin in the game”…
Political Calculations | A Four Year Milestone for U.S. Jobs
Four years ago, the number of employed Americans peaked at 146,584,000 in November 2007, just ahead of the U.S. economy itself peaking in December 2007, which marked the starting point for the nation's most recent economic recession.
Calculated Risk | Seasonal Retail Hiring, Duration of Unemployment, Unemployment by Education and Diffusion Indexes
According to the BLS employment report, retailers hired seasonal workers at close to the pre-crisis pace in November.
EconLog | Are These Recessions All the Same?
Here are some data on job losses in each recession since 1970 (I grouped together the two recessions in 1980-1982). I look at total losses in nonfarm payroll employment and losses in employment in the durable goods sector.
WSJ: Real Time Economics | Economists React: Something Good Stirring in the Economy?
Economists and others weigh in onthe increase in nonfarm payrolls and the drop in the unemployment rate.
Calculated Risk | Comments on the Employment-Population Ratio
...if the unemployment rate stayed steady, the employment-population ratio would follow the participation rate. This is important because the participation rate is impacted by changes in demographics…
Marginal Revolution | How much do unions matter?
The estimates suggest that about one quarter of the increase in the variance of log earnings from 1979 to 2009 can be accounted for by falling U.S. private sector unionization rates, a larger fraction than earlier studies have found.
American: Enterprise Blog | Why the plunging unemployment rate could mean the U.S. economy is broken
If trend GDP growth is 2.5 percent, and over the past year the economy grew at a 1.5 percent clip, then Okun’s Law predicts the unemployment rate would rise about half a percentage point.
WSJ: Real Time Economics | Did Economy Create Nearly 500,000 Jobs in November?
According to one little-followed measure, the economy created about 500,000 jobs last month — more than four times as many as the government’s official figure of 120,000.
Mercatus Center: Neighborhood Effects | Requiring Volunteer Work for Unemployment Benefits
Georgia’s historically high unemployment rate coupled with the fact that its unemployment trust fund has recently reached insolvency, has led law makers to reconsider the structure of their state’s unemployment system.
Reports
Heritage Foundation | Heritage Employment Report: November Jobs Not Quite a Feast
The sharp drop in the unemployment rate was a result of solid job growth in the household survey and also, worryingly, a large exodus of people from the workforce.
Budget
News
USA Today | Many have little to no savings as retirement looms
Not only are many Americans close to retirement age lacking savings, some are in the hole financially.
Econ Comments
Fiscal Times | The Debt Debacle: Why Alan Simpson Is Mad as Hell
He said that failure to reach an agreement on how to reduce the deficit by $1.2 trillion over the next decade will put the country into a “deep funk,” and there is no telling when the U.S. could hit its credit limit.
Blogs
American: Enterprise Blog | Stop Social Security’s raid on the federal treasury
Moving money around within the federal government cannot change the government’s overall financial position, but can reallocate budgetary resources between Social Security and other programs.
USA Today | Many have little to no savings as retirement looms
Not only are many Americans close to retirement age lacking savings, some are in the hole financially.
Econ Comments
Fiscal Times | The Debt Debacle: Why Alan Simpson Is Mad as Hell
He said that failure to reach an agreement on how to reduce the deficit by $1.2 trillion over the next decade will put the country into a “deep funk,” and there is no telling when the U.S. could hit its credit limit.
Blogs
American: Enterprise Blog | Stop Social Security’s raid on the federal treasury
Moving money around within the federal government cannot change the government’s overall financial position, but can reallocate budgetary resources between Social Security and other programs.
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