News
WSJ | Euro-Zone Business Activity Shrinks
Euro-zone business activity fell back into contraction in February, raising the chances of a recession in the first quarter of the year, a survey of business activity showed Monday.
Market Watch | China lowers growth target half a point to 7.5%
China’s government on Monday lowered its economic-growth target to 7.5% from last year’s 8%, indicating that it intends to focus on higher-quality economic development that emphasizes internal consumption and services.
Bloomberg | Stocks Cheaper Than Any U.S. Peak in 23 Years
Corporate profits that doubled since 2009 have left the Standard & Poor’s 500 Index cheaper than at all 34 peaks since 1989, even as options traders push the cost of protecting against losses to the highest in four years.
Washington Times | D.C.-area economy makes gains after recession
While the national economy struggles to attain cruising altitude, the Washington-area economy has taken a small turn for the better, according to George Mason University professor and economic forecaster John McClain.
USA Today | 30-year mortgage average rate dips to 3.9%
The average rate on the 30-year mortgage edged down this week to hover again above record lows. Cheaper rates have spurred modest improvements in the battered housing market, but not enough to signal a recovery.
Econ Comments & Analysis
NBER | Inconsistent Regulators: Evidence From Banking
US state chartered commercial banks are supervised alternately by state and federal regulators. Each regulator supervises a given bank for a fixed time period according to a predetermined rotation schedule. We use unique data to examine differences between federal and state regulators for these banks.
Washington Times | Small business expectations
In a speech to the Chamber of Commerce last month, President Obama proclaimed, “Now is the time to invest in America.” A National Federation of Independent Business (NFIB) survey shows small businesses aren’t buying it.
WSJ | The Export Subsidy Boomerang
If you thought Fannie Mae, Freddie Mac and Solyndra would teach Congress a lesson about politicized credit, think again. The federal Export-Import Bank is up for reauthorization, and the only question seems to be how much more taxpayer money Washington wants to put at risk. If the GOP wants to have a principled battle about fiscal waste and market distortions, this is a good one.
Market Watch | The limits of China’s state capitalism
In today’s international debate over China’s development model, a commonly heard term is “state capitalism,’ and one oft-cited example of this is the country’s development of high-speed railways.
Politico | Stop rising gas prices from killing small business
Our nation’s economy is at a fragile turning point in its recovery. Job creation, consumer spending and production data are slowly starting to show signs of improvement. But we are still far from the strong economy our nation is accustomed to.
Washington Times | Big government expectations
The government has grown so large that nobody really knows where its $3.8 trillion in annual spending goes. Each year, the Government Accountability Office (GAO) tries - and fails - to make sense of federal-agency ledgers.
Bloomberg | Cash Is Better Than Food Stamps in Helping Poor: Edward Glaeser
Newt Gingrich has been castigated for referring to President Barack Obama as the “best food-stamp president in American history.” I, too, dislike the former House speaker’s inflammatory phrasing.
Blogs
Calculated Risk | Unofficial Problem Bank list at 959 Institutions
This is an unofficial list of Problem Banks compiled only from public sources.
WSJ | Housing Still Drowning in Underwater Mortgages
As Federal Reserve Chairman Ben Bernanke told Congress this week, “problems in U.S. housing and mortgage markets have continued to hold down not only construction and related industries, but also household wealth and confidence.”
Calculated Risk | Personal Saving Rate and Income less Transfer Payments
By request, a couple more graphs based on the January Personal Income and Outlays report.
WSJ | More Than 1 in 7 Use Food Stamps in U.S.
Food-stamp use jumped in the U.S. in December with more than 1 in 7 people receiving benefits, even as a program for disaster assistance related to Hurricane Irene came to an end.
Calculated Risk | Schedule for Week of March 4th
The key report this week is the February employment situation report from the Bureau of Labor Statistics (BLS) scheduled for Friday. Other reports include the February ISM service index on Monday, and the January trade balance report on Friday.
WSJ | For Lasting Recovery, Savings as Important as Spending
Even with faster income growth and more confidence in the labor markets, U.S. consumers are not rushing to shop. The latest numbers, out Thursday, show after accounting for prices, consumer spending has been flat for three consecutive months.
John Taylor | Debating Stimulus and Harvard and Stanford
Larry Summers and I debated “Did Fiscal Stimulus Help the Economy?” at Harvard this week. There was no video streaming or recording, and I will not try to summarize the back and forth (which the overflow crowd seemed to enjoy), but here is a summary of things I said in my opening remarks.
Café Hayek | State of Manufacturing
Letting loose my inner Mark Perry (sans his skill at constructing useful graphs), I explain – in this, my latest column in the magazine President & CEO – that the state of manufacturing in America is today quite robust.
