Friday, December 16, 2011

General Economics

CNBC | New Foreclosure Wave is Coming
As banks resubmit millions of documents and courts begin hearing cases again, the backlog of over four million delinquent loans will start surging through the pipeline again.
Bloomberg | Bank Failures Cost $88 Billion
More than 400 such failures since 2007 have cost the fund, which is fed by banks and backstopped by taxpayers, an estimated $88 billion. That volume shows the need for more transparency in bank regulation, which is largely conducted in the dark.
Bloomberg | Swiss Join Suffering as Europe Crisis Ripples
The economy will expand 0.2 percent next year and 1.9 percent in 2013, the Zurich-based institute said in a statement today, cutting previous projections.
CNN: Money | Fitch downgrades world's largest banks
The ratings firm Fitch downgraded a cluster of the world's largest banks Thursday, pointing to trading challenges facing international markets.

Econ Comments                                                                                                             
WSJ | High-Speed Railroad Job
In 2008 voters approved a $10 billion bond to fund the 500-mile bullet train, but cost estimates have since exploded to $100 billion from $33 billion and the mirage of federal government and private funding has disappeared.
Daily Caller | The inequality myth
Today, many people are more sensitive than ever to inequalities of any size. So the president thinks he can claw back some of the middle and working classes by promising to lift up the wretched at the expense of the wealthy.

Econlog | How Food Stamps Increase Measured Poverty
So food stamps, Medicaid, Medicare, and subsidized housing, a substantial part of the welfare state, don't count in measuring people's income. And those items, especially food stamps, are a particularly large part of the poor people's income.
AEI: The American | When free trade isn’t free
The WTO is set to offer membership to Russia, and the Russians are largely expected to accept and approve the bid by early 2012, thus ending an 18-year struggle to join the ranks of free trade nations. Under the terms agreed to by Russia, tariffs will drop by about 22 percent for most Asian and European nations.
Cato @ Liberty | WTO Remains a Force for Good
Trade ministers from more than 150 countries are gathering today in Geneva, Switzerland, for a three-day ministerial meeting of the World Trade Organization.
ThinkMarkets | Hayek on the Large Corporation
Most obviously, it is a form with limited liability and special tax treatment, among other things. So the growth of corporate entities is not independent of its specific legislated form.
Daily Capitalist | Bernanke’s Legacy
You know when they start talking about a politician’s legacy that he is toast. I think that’s what happens when you think you can run the economy and fail.
Minyanville | Three Ways to Fix Europe Without Europe's Help
Lowered volatility would ease global financial stress -- and we can make it happen without the Europeans.

Health Care

National Journal | Wyden-Ryan Plan Leaves Medicare Cuts for Another Day
The most surprising element in a bipartisan proposal tackling the rising cost of Medicare is not that a Democrat and a Republican have teamed up to push for privatization of the program. It’s that they think Congress can do the tough work of reining in health care expenses.

Cato @ Liberty | Published: My First Year Battling Obamacare
The individual mandate is Obamacare’s highest-profile and perhaps most egregious constitutional violation because the Supreme Court has never allowed – Congress has never claimed – the power to require people to engage in economic activity.
AEI: The American | One step closer to a Medicare reform that can work
Under the new proposal, traditional fee-for-service Medicare would continue to be available to future generations of seniors, but it must now compete head-to-head with private plans.
Heritage Foundation | Decrease in Young Uninsured: Does Obamacare Deserve Credit?
Yesterday, the Administration released data from the 2011 National Health Interview Survey that shows, among other things, that the number of uninsured young adults declined over the last year.
NRO: The Corner | The Ryan-Wyden Plan
Any bipartisan plan that makes significant reforms to Medicare would be a step in the right direction. However, I am skeptical that this plan can deliver on its promises.


Market Watch | U.S. wholesale prices rise 0.3% in November
U.S. wholesale costs rose modestly in November as the price of food increased, mostly for vegetables and chicken.
Market Watch | Dollar scales back some recent gains
The dollar further scaled back some of its recent advances against the euro and other major currencies Friday, showing mild signs of investor appreciation of strong U.S. data and a modest rebound on Wall Street and in Asian stocks.

WSJ | Fed Reports Borrowing From Foreign Central Banks
The Federal Reserve‘s dollar-liquidity facility for central banks was reported as $52.387 billion in the week ended Wednesday, driven largely by demand from the European Central Bank.


NY Times | Disagreement Over Payroll Tax Cut’s Impact on Social Security
For all of the partisan brawling over President Obama’s call to extend a temporary payroll tax cut for 160 million Americans, one concern is bipartisan: a significant minority of Democrats and Republicans say that cutting the taxes that finance Social Security benefits will further undermine the program.

Econ Comments                                                                                                             
WSJ | Calling Obama's Payroll Tax Bluff
Obama billed last year's cut as a one-year holiday to boost the economy. Now preserving it is about fairness.
Bloomberg | Hypocrisy Proves Bipartisan in Payroll Tax Debate: Caroline Baum
President Barack Obama says the increase in employee-paid payroll taxes (back to 6.2 percent from the current 4.2 percent) will raise the average American family’s tax liability by $1,000, which translates to $83.34 per month or $38.46 per paycheck for those who get paid biweekly.
WSJ | The Keystone Ultimatum
Will Obama veto a tax holiday to stop a job-creating pipeline?

Atlantic: McArdle | When it Comes to Taxes on the Poor, the Supply Siders are Right
Everyone I've spoken to about the problem seems to agree that the poor respond to these high marginal tax rates by either taking lower-paying jobs than they could, or working less--not in every individual case, but in aggregate.


CNN Money | Initial jobless claims fall to lowest level since 2008
Fewer Americans filed for their first week of unemployment benefits last week. So few in fact, that initial jobless claims were at their lowest level since May 2008.
Politico | Poll: Jobs priority over wealth gap
Growing the economy is more important than reducing the wealth gap between rich and poor, a new Gallup survey shows.
Fox News | On the Job Hunt: Machinists in High Demand
America's economy was forged by machinists. But today, a quarter of the nation's welders, engineers and steelworkers are getting ready to retire. And as budget-strapped school districts cut shop classes, fewer young people are entering the trade.
CNN Money | Morgan Stanley slashing 1,600 jobs
Adding to Wall Street's job woes, Morgan Stanley announced Thursday that it plans to cut 1,600 positions in the first quarter.

Econ Comments                                                                                                             
Washington Times | WALKER: When unemployment checks check employment
For some, the true measure of success for government is determining how many more people are on public assistance. In their world, unemployment-compensation checks are viewed as a form of economic development.

WSJ: Real Time Economics | Is 400,000 Still The Magic Number for Jobless Claims?
Today the Labor Department reported another big drop in weekly jobless claims –cheering economists and investors who use the indicator to get a quick read on the economy. The 366,000 unemployed Americans who filed initial claims last week marked a three-and-a-half year low.

NBER | Unemployment Insurance and Job Search in the Great Recession
The estimates imply that UI benefit extensions raised the unemployment rate in early 2011 by only about 0.1-0.5 percentage points, much less than is implied by previous analyses, with at least half of this effect attributable to reduced labor force exit among the unemployed rather than to the changes in reemployment rates that are of greater policy concern.


Washington Times | Central bank offers little comfort on EU finances
European Central Bank President Mario Draghi warned Thursday that there’s “no external savior” for heavily indebted governments in the 17-nation eurozone and gave no indication the bank is ready to step in and support their finances.
Roll Call | Appropriators Reach $1 Trillion Deal in Principle
Congressional appropriators agreed to a $1 trillion deal to fund the federal government through the end of 2012 late tonight, in principle narrowly averting a government shutdown.

Econ Comments                                                                                                             
WSJ | And the Crisis Winner Is? Government
From Greece to Washington to New York state, there's no effective mechanism to control spending.
Washington Times | YOUNG: Economics and politics battle over budget
Urge to spend regardless of revenue is government’s undoing.
Financial Post | When we were Europe
Canada’s past experience lends support to Germany’s current opposition to non-sterilized bond buying by the European Central Bank and other short-term solutions in favour of accelerated fiscal austerity and reforms. The only long-run viable policy solution for the ultimate survival of the eurozone is through reining in the purse strings.
Washington Times | U.S. no longer a leader of fiscal rescue
Europe to get aid elsewhere.
Politico | The truth in budgeting
The national debt is now more than $15 trillion. The budget deficit for this fiscal year alone will be more than $1 trillion. This mountain of debt is a growing obstacle to economic recovery. But for many in Washington, it’s business as usual.

American: Enterprise Blog | Keeping the United States solvent, one crisis at a time
Mid-summer, U.S. prime money market funds became aware that they were alarmingly exposed to the eurozone crisis through their holdings in European banks. At that time, more than 45 percent—more than $1 trillion—of U.S. MMFs were invested in European banks which were themselves heavily exposed to bad European debt.
Heritage Foundation | Mega-Omni: Another Get-Out-of-Town Budget Debacle
The House mega-omni—the massive nine-bill appropriations package now moving toward a vote in the House—represents another disappointing failure to cut spending and prove Congress can instill some measure of fiscal discipline. Equally troubling: The procedure for considering the legislation allows everyone to vote for something he likes, while taxpayers pick up the tab.
American: Enterprise Blog | The U.S. could be out $1 trillion if the euro zone collapses
The attempt to bail out Europe has already begun. And America is on the hook for plenty.

CBO | Reducing the Size of the Federal Government Through Attrition Act of 2011
CBO estimates that implementing H.R. 3029 would reduce discretionary spending by about $35 billion over the 2012-2016 period.