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Friday, August 31, 2012

General Economics

News                                                                                                                             
USA Today | Mortgage rates dip this week, average is back below 3.6%
Average U.S. rates on fixed mortgages fell this week and are just slightly above record lows reached earlier this year. The low rates have contributed to a modest housing recovery.
CNN Money | Shell gets OK for Arctic drilling prep
The Obama administration has granted Royal Dutch Shell permission to begin drilling preparations off the coast of Alaska, bringing the region a step closer to offshore oil production.

Econ Comments & Analysis                                                                                            
Freeman | Inconceivable Complexity
A market economy is indescribably vast and complex—its success depends on so many intricate, changing details all somehow being made to work smoothly together that the “facts” that are essential to its thriving cannot be catalogued with anywhere near the completeness that can be achieved by a 21st-century scientist studying and cataloging the “facts” that enable sparrows to fly.
Bloomberg | Decline in U.S. Seen Without More Immigration: Cutting Research
The U.S.’s best 250 years are behind it, Northwestern University professor Robert Gordon writes in a paper published by the National Bureau of Economic Research, saying economic growth may gradually “sputter out.”
WSJ | George Gilder: The Real Reagan Lesson for Romney-Ryan
Follow Peter Drucker's advice: Don't solve problems, pursue opportunities. Like unlocking America's entrepreneurial value.

Blogs                                                                                                                             
Cato @ Liberty | Hayek Wasn’t a ‘Free Market Marxist’
Hayek was convinced that “no human mind can comprehend all the knowledge which guides the actions of society.”
Heritage Foundation | U.S. Farmers Seeing Record Profits, Thanks to Taxpayers and Government
The Financial Times reports that “U.S. farmers are heading for their most profitable year on record despite the worst drought in half a century as high grain prices and payouts from a federal crop insurance program compensate for a smaller harvest.”
Econlog | Conard on Trade and the Trade Defici
When offshore producers "dump" incremental production between full cost, we capture the benefit of lower prices. When foreign governments subsidize trade with tax credits or hold dollars to support their currencies, we capture the value of those subsidies.
CNN Money | Union membership down, income inequality up
The decline of union membership has been a key driver of income inequality in recent decades, a new report found.
Cato @ Liberty | After the Welfare State
Young people today are being robbed. Of their rights. Of their freedom. Of their dignity. Of their futures.
AEI | Shifting demographics may explain the ‘hollowing out’ of the middle class
In 1971, Pew calculated that 25% of U.S. adults were in the “lower income” category, but by 2011 the share of “lower income” Americans had increased to 29%.

Health Care

Econ Comments & Analysis                                                                                            
Washington Times | DEAL: Georgia’s budget can’t take Obamacare
To entice states to come onboard with the Medicaid expansion, the federal government is using an old trick: The first one’s free. But soon thereafter, the state’s on the hook for ballooning costs.
Heritage Foundation | Medicaid Expansion Will Become More Costly to States
State legislators cannot afford to be myopic when assessing the costs and benefits of expanding Medicaid.

Monetary

News                                                                                                                             
Market Watch | ECB: Inflation expectations 'well-anchored'
Inflation expectations are "very well" anchored in the euro zone, European Central Bank Executive Board member Benoit Coeure said in a speech released Friday, suggesting less than a week before the ECB's next rate meeting that inflation expectations aren't a concern.
WSJ | Academic Sways Central Bankers
Since January, Fed officials have said they expect to keep short-term interest rates near zero at least through late 2014. Minutes of their July 31-Aug. 1 policy meeting show they considered saying rates would stay low for longer.
Bloomberg | Dallas Fed Warns Against 'Ultra Easy' Money
Vincent Reinhart, a former top Fed staffer who is now chief U.S. economist for Morgan Stanley, said there was little chance that Bernanke would make news in Jackson Hole, in part because of his concern for consensus.
Market Watch | Draghi’s ‘convertibility’ fears set ECB tough task
European Central Bank President Mario Draghi is fighting a battle against fear itself.

Econ Comments & Analysis                                                                                            
Daily Finance | What a Return to the Gold Standard Would Mean for You
The GOP's proposed platform, which will be debated over the next few days, calls for a commission to study the feasibility of a return to a fixed value currency.
Market Watch | Fed's Bullard not ready to support more QE
St. Louis Federal Reserve Bank President James Bullard said he was not ready to support another large asset-purchase plan. In an interview with Bloomberg TV, Bullard said he would like to see more data before taking "really big action." Bullard said he would support "smaller things" like cutting the interest rate paid on excess reserves that banks park at the central bank.
RCM | A Return to Hard Money? Let's Get It Right This Time
The Great Inflation had reached its crescendo at the time of that proposal. In terms of monetary conditions, the massive consumer price inflation inflicted on the global economy had led to more than a decade of impoverishment.
Daily Finance | My Inflation Isn't Like Your Inflation
Food price inflation can be severe at times, too. The price of ground beef, for example, was recently nearly 6% higher than it was a year earlier, and steak prices were up nearly 9%.

Taxes

News                                                                                                                             
Fox Business | Tax Implications of Selling Your Home
If you are considering selling your home, there are a few things to keep in mind in order to minimize your tax risk.

Econ Comments & Analysis                                                                                            
CNN Money | How much should the rich pay in taxes?
Most people would say millionaires and billionaires are rich. That's easy. Where to draw the line lower down the income scale is much harder.

Employment

News                                                                                                                             

USA Today | Jobs come back unevenly in states
The U.S. lost 8.8 million jobs from the start of 2008 through February 2010. It has regained 4.0 million - fewer than half - in the roughly 2 1/2 years since the job market hit bottom.
Fox News | American Airlines gives more than 200 flight attendants jobs back 11 years later
Just months before 9/11, American Airlines purchased St. Louis-based TWA. American cut 2,500 attendants in the industry slowdown that came in the wake of the attacks.

Econ Comments & Analysis                                                                                            
Heritage Foundation | Not Looking for Work: Why Labor Force Participation Has Fallen During the Recession
The drop in unemployment since 2009 is almost entirely due to the fact that those not looking for work do not count as unemployed. Demographic factors explain one-fifth of the decreased labor force participation. The rest comes from increased school enrollment and more people collecting disability benefits.
Washington Times | VALENZUELA: Governments cannot create jobs
Growth relies on entrepreneurs.

Budget

News                                                                                                                             
WSJ | Judgment Days Arrive for Euro Crisis
After an uncharacteristically calm August, European policy makers and financial markets are facing a tumultuous autumn marked by major showdowns in key euro-zone battlegrounds.

Blogs                                                                                                                             
Heritage Foundation: The Foundry | Heritage Foundation “Cut Government Spending” Goal Gains Ground
The Heritage plan proposes to balance the federal budget within a decade and keep it balanced forever at no more than 18.5 percent of the total output of the American economy in goods and services in a single year, called gross domestic product (GDP).
Mercatus Center: Neighborhood Effects | Generational Unfairness in Pensions
Today’s taxpayers are paying for current retirees who provided state services in the past. Likewise, the new reforms require sacrifices primarily from new workers.

Thursday, August 30, 2012

General Economics

News                                                                                                                             
WSJ | Consumer Spending Ticks Up
U.S. personal spending rose the most in five months in July, a sign that wary consumers may be coming out of their shell despite broad economic uncertainty.
CNN Money | Consumers cut up credit cards, but buy cars
At 10.9%, credit card delinquencies are at their lowest level since the end of 2008. And credit inquiries, an indicator of demand, fell for the second consecutive quarter.
Bloomberg | Distressed Home Prices Jump With Inventory Shrinking
Demand for distressed properties is driving up prices for the first time in two years as investors from Blackstone Group LP (BX) to Colony Capital LLC chase shrinking inventory.
Market Watch | Euro-zone Aug. economic sentiment index falls
The European Commission on Thursday said its euro-zone economic sentiment indicator fell to 86.1 in August from 87.9 in July, reflecting an across the board decline in its sector indexes.

Econ Comments & Analysis                                                                                            
CNN Money | Unhappy with the economy? Here's why
For the third year in a row we've experienced a thaw in the economy only to be followed by some real dog days. The U.S. is barely growing, and a lot of the reason is that you aren't spending.
WSJ | Reagan and Obama: A Tale of Two Recoveries
How these two presidents responded to a deep recession reveals polar extremes in policy. And in results.
RCM | Don't Believe the Near-Term Data, We've Not Reached a Housing Bottom
This time around the cause of the uptick is that there were fewer foreclosures being processed over the past year which, thanks in part to the robo-signing scandal, has effectively taken existing housing supply off the market.
CNN Money | Citi to pay $590 million to investors
Bank has paid out or agreed to $2.3 billion in penalties related to the financial crisis in the past year.

Blogs                                                                                                                             
AEI | Cronyism is just as threatening to free enterprise as big government
Statism and cronyism are fundamentally about the same things: Letting political power allocate economic resources rather than markets. Both reduce competition and entrench stagnation.

Health Care

Econ Comments & Analysis                                                                                            
RCM | Health Insurers: Mind Your Own Business
Obamacare includes what the health care technocracy calls the "MLR rule" - minimum requirements for medical-loss ratios - or the percentage of premiums collected by health insurers that must be spent on medical care or refunded.

Monetary

News                                                                                                                             
Market Watch | Atlanta Fed's Lockhart: Close call on more easing
Atlanta Fed President Dennis Lockhart said it's a "close call" as to whether more easing is needed at this point. Speaking on CNBC, Lockhart said it's clear the economy is growing around 2% and that inflation is "well behaved." Lockhart is a voting member of the Federal Open Market Committee.

Econ Comments & Analysis                                                                                            
CNN Money | Baltimore: The city that sues the banks
The Libor scandal plays out in an unlikely place - the streets of Charm City.
WSJ | The Gold Standard Goes Mainstream
In the ferment within today's Republican Party, there's a growing realization that America's system of fiat money is part of the economic problem.
Forbes | What Is It About a Stable Dollar That Paul Krugman Doesn't Understand?
During the 180 years that we had one form or another of “a fixed value for the dollar” (1790 – 1970), the U.S. economy grew at an average annual real rate of 3.94%. During the past 41 years of fiat money (1970 – 2011), our real GDP grew at 2.81%.

Blogs                                                                                                                             
WSJ: Real Time Economics | Negative Rates Would Have Many Consequences
There would be several potentially negative consequences for both the U.S. economy and finance generally if borrowers start getting paid by those lending them cash, two economists warned.
Free Banking | Let’s have the debate on gold
Among those wishing to foreclose debate I see many clever scribblers, but nobody who shows evidence of having studied in detail the history and workings of the gold standard, as it existed both inside and outside the United States.

Taxes

News                                                                                                                             
CNBC | French PM: 75% Tax Will Not Define Government
France’s Prime Minister has told CNBC that his government will work hard with businesses to avoid major job losses and dismissed claims that his government is anti-business and driving away investment with a 75 percent tax on high earners.

Employment

News                                                                                                                             
WSJ | Fed Sees Modest Growth as Jobs, Housing Improve
The U.S. economy inched ahead in July and early August, as the jobs picture improved slightly in some areas and the housing market continued to mend, the Federal Reserve said in a report Wednesday.
Bloomberg | Jobless Claims in U.S. Unchanged Last Week at One-Month High
Jobless claims were little changed at 374,000 in the week ended Aug. 25, matching the upwardly revised figure from the prior week, the Labor Department reported today in Washington.
USA TODAY | Serious shortage of skilled auto mechanics looming
There is already competition among auto dealers in many parts of the nation to hire or retain good technicians. The bigger worry is whether there will be enough younger workers in a few years as a wave of midcareer mechanics hits retirement age.

Econ Comments & Analysis                                                                                            
Heritage Foundation | Government Makes It More Difficult for First-Time Job Seekers
Government policies have made this difficult labor market even worse for younger Americans. In 2007, Congress voted to raise the federal minimum wage to $7.25 an hour. Half of minimum wage earners are between the ages of 16 and 24.

Budget

News                                                                                                                             
WSJ | Greece Makes Late Push on Cuts
Greece's political leaders said that despite disagreements over the targets of spending cuts, they are confident they can agree on an austerity plan in time for the arrival next week of a team of inspectors from international creditors.
Bloomberg | Wen Tells Merkel Spain, Italy, Greece Need More Reforms
Chinese Premier Wen Jiabao told his German counterpart that Spain, Italy and Greece must take steps to prevent a worsening of the euro region’s sovereign-debt crisis as he pledged to consider further European bond purchases.

Econ Comments & Analysis                                                                                            
4% Growth | Stop Bailing Out Cities
Billions of dollars will be spent this year to do a myriad of things to entice people to stay in cities that hold little in the way of economic promise.

Wednesday, August 29, 2012

General Economics

News                                                                                                                             
WSJ | Euro-Zone Bank Lending to Businesses Rises
European Central Bank figures showed that private-sector credit grew on an annual basis for the first time in three months, as July's cut in interest rates and unorthodox policy measures from earlier in the year made themselves felt.
Market Watch | U.S. grew at 1.7% pace in second quarter
The U.S. economy expanded somewhat faster in the second quarter than originally reported because of higher consumer spending and slower growth in imports, the government said Wednesday.
WSJ | Despite Drought, Farm Income Should Rise
Income on U.S. farms is expected to climb this year to its highest level in nearly four decades, the Department of Agriculture said, despite the severe drought that has afflicted much of the nation's farm belt.
Market Watch | Pending home sales hit more than 2-year peak
Pending home sales climbed 2.4% in July to the highest level since April 2010, when a home-buyer tax credit was set to expire.
USA Today | Gas prices cross $3.75 a gallon as Labor Day looms
Gas prices continued their unrelenting rise, crossing the $3.75 a gallon threshold, the U.S. Energy Information Administration reports in its weekly survey. The price increase comes at a difficult time, with Labor Day vacation weekend only a week away.
WSJ | Japan Cuts Economic View Amid Slowing Exports
The Japanese government cut its view of the economy in August for the first time in 10 months as slowing exports weighed on production and consumer spending failed to expand.
CNBC | The US Economy and the Future of Growth: Well This Is Depressing
The United States has produced one of the most successful economic stories in human history.

Econ Comments & Analysis                                                                                            
RCM | The New York Fed's False Assertion of AIG Bailout Profits
The government reasoned that cancelling the derivatives by buying the securities at full value was the cheapest way out of AIGFP's troubles.
Daily Finance | Think Federal Workers Are Overpaid? Look Closer to Home
The advantage only swings toward the private sector when workers possess a master's degree or better. What's more, when you factor in the value of generous government perks, even private sector master's degree-holders lose out.
Washington Times | DEAN: Government programs never die
Ronald Reagan once observed that nothing lasts longer than a temporary government program. How right he was.
WSJ | A Grand Old Growth Party
Above all, voters want to hear how Republicans will restore prosperity.
Heritage Foundation | Hydraulic Fracturing: Critical for Energy Production, Jobs, and Economic Growth
While Americans continue to be disappointed by dismal jobs reports and a high unemployment rate, one of the few recent bright spots in the U.S. economy has been energy production, particularly the shale oil and shale gas revolution.

Blogs                                                                                                                             
EconLog | Household Incomes Declined During Recovery
The study shows that real median household income declined more during the current recovery than it did during the recent recession.
Daily Capitalist | Bad Advice More Popular Than Ever
At some point this is all going to go horribly wrong, what with UK sovereign risk and banking risk having become effectively fused (under the last Labour government). The only thing we don’t know is when.
NRO: The Corner | Croynism: Utility Edition
Exelon executives and administration officials held a large number of meetings at the White House, and ultimately, the executive branch enacted a number of policies and regulations that favored the company at the expense of its competitors. Lipton, for instance, highlights:
AEI | Fuel economy standards to tighten
The Obama administration has plunged ahead with it’s plan to drastically increase the average fuel economy of the U.S. automobile fleet.
Heritage Foundation | Cronyism: Crushing the Free Market and Promoting Rent-Seeking
A recent report by Mercatus Center scholar Matthew Mitchell lists the various forms that government-granted privileges take and explains their harmful consequences, including less economic growth, more government spending, and rent-seeking.
Café Hayek | Predicting the Inevitable
Depending on the severity of the damage done by Isaac, prices of staple goods such as gasoline, bottled water, and plywood will spike in south Louisiana and Mississippi – price increases that will (here’s the prediction) spark a litany of economically uninformed laments about greed and “price gouging.”

Health Care

News                                                                                                                             
NY Times | Sharp Cuts in Dental Coverage for Adults on Medicaid
Banned from tightening Medicaid eligibility in recent years, many states have instead slashed optional benefits for millions of poor adults in the program. Teeth have suffered disproportionately.

Econ Comments & Analysis                                                                                            
Washington Times | FOSTER: No ducking Medicare anymore
Medicare added about $223 billion to budget deficits in 2011. How? Medicare’s health insurance comes with an average annual subsidy of just more than $5,000 per senior. Sweet deal, but this subsidy is the source of the Medicare’s financing problem.

Monetary

News                                                                                                                             
USA Today | All ears turn to Bernanke's Jackson Hole speech Friday
Bernanke is expected to talk about what the Fed can — and might — do next to help the economy grow at a peppier pace, and what might prompt it to act. Investors will listen for clues to help decipher if, and when, Bernanke would inject a new round of stimulus.
Market Watch | Draghi: ECB will always act within its mandate
European Central Bank President Mario Draghi said the institution will always "act within its mandate," but noted that fulfilling its mandate to provide price stability "sometimes requires us to go beyond standard monetary-policy tools."

Econ Comments & Analysis                                                                                            
RCM | The Lost Bush/Obama Era Gave Us the Gold Commission
What must be understood is that it was a cheap dollar policy beginning in 2001 that underlay what is now known as the "Financial Crisis."
Investors.com | The Fed Shouldn't Double-Down On Failure
Even so, some speculate that Bernanke will announce this Friday — or at an upcoming Fed meeting — one of two policy moves.
Forbes | The First Gold Commission Scared the Dickens Out of the Fed
The thing about these moves is that they respond precisely to the two things that have become the top concerns of the public as these unacceptable last four years have unfolded.
Reuters | Trickle-down quantitative easing: James Saft
A Bank of England study, released last week, showed that its 325 billion pounds of bond purchases have disproportionately benefited the wealthiest, driving up the value of the assets they own.

Blogs                                                                                                                             
Cato @ Liberty | Swiss Monetary Policy: Dangerous Contradictions
The Swiss National Bank is conducting a bizarre, contradictory, and potentially dangerous set of monetary policies.

Taxes

Econ Comments & Analysis                                                                                            
Politico | End wind energy tax credit
First, an extension continues this unsettling policy trend in which citizens are asked to bear all the risks and gain none of the rewards.
CNN Money | A radical tax plan the left and right can agree on
The President, key conservatives, and even some of the nation's biggest corporations are leaning toward trading special breaks for lower rates.

Blogs                                                                                                                             
Keith Hennessey | Tax levels cheat sheet
There is a danger that measuring tax levels as shares of GDP will lead to casually concluding that “only one or two percentage points difference” is not a big deal. This would be a huge mistake.
Tax Foundation | Media Leaves Out Key Things in Covering Poll Showing Support for Taxing Rich
The survey did not ask respondents what they think the rich should pay, or what the rich pay now.
AEIdeas | Why a carbon tax is still a bad idea
Once again, the New York Times has published an article calling for a carbon tax, and not a little baby one either: This would be a carbon tax with teeth...

Employment

News                                                                                                                             
WSJ | Gap Hurts Job Hunters
Mismatch Between Worker Education Levels and Vacancies Hits Frail Economies.
Bloomberg | Shortage of Educated Workers Boosts U.S. Joblessness
Cities with larger gaps in education levels between workers and available positions have lower rates of job creation and new openings, the institution’s Jonathan Rothwell said in a report published today.

Budget

News                                                                                                                             
WSJ | Portugal at Crossroads as Creditors Visit Lisbon
Officials from the European Union and the International Monetary Fund arrived in Lisbon Tuesday to assess the country's progress in implementing a €78 billion ($97.5 billion) bailout program, as signs emerge that tough austerity measures may be hurting the government's ability to meet budget deficit targets.

Econ Comments & Analysis                                                                                            
WSJ | Steer Clear of the Cliff
How to avoid imminent fiscal disaster and long-term decline.
Barron's | State of the States
Long considered the best issuers in the municipal bond market, states are under a lot of strain. Mounting pension shortfalls and high debt are upping the risk for state muni-bond investors.

Tuesday, August 28, 2012

General Economics

News                                                                                                                             
USA Today | Gas prices likely to rise after Isaac
"We're definitely going to see a bump," says Brian Milne of energy tracker Telvent DTN. "We're going to get into the $3.80s at minimum and it could go higher, depending on how quickly things are resolved."
Bloomberg | Consumer Confidence in U.S. Declines by Most Since October
Confidence among U.S. consumers fell in August by the most in 10 months as households grew more pessimistic about their employment prospects and the economic outlook.
CNN Money | Home prices signal recovery may be here
A sharp boost in home prices during the spring could signal a recovery in the long-suffering U.S. housing market, according to an industry report issued Tuesday.
Fox Business | Crop Insurance Losses From Drought Could Reach $20B
The drought that left farmland in the U.S. barren and ravaged crop production may add up to total crop insurance losses of more than $13 billion, disaster modeler AIR Worldwide said on Tuesday.

Econ Comments & Analysis                                                                                            
WSJ | The Return of Welfare as We Used to Know It
There are many ways to aid the poor. Ending work rules isn't one of them.
Cato Institute | The Impact of Charter Schools on Public and Private School Enrollments
The flow of private-school students into charters has important fiscal implications for districts and states. When charters draw students from private schools, demands for tax revenue increase.
Washington Times | FEULNER: Teachers unions’ pressure is failing
School choice is passing the test.

Blogs                                                                                                                             
Marginal Revolution | A look at U.S. income growth
“A provocative “exercise in subtraction” suggests that future growth in consumption per capita for the bottom 99 percent of the income distribution could fall below 0.5 percent per year for an extended period of decades.”
Heritage Foundation | Want Cheaper Gasoline? Waive Regulations
Even as the summer travel season is winding down, drivers have certainly noticed that gas prices are marching back up. Since the law of supply and demand hasn’t yet been repealed (or even suspended by executive order) the answer seems simple enough: increase the amount of gasoline available.
Cato @ Liberty | One of Many Ways the SEC Contributed to the Financial Crisis
I was recently reminded that in its infinite wisdom, the Securities and Exchange Commission (SEC) actually sued banks as the housing bubble was building for putting aside too much money to coverage potential loan losses.
WSJ: Real Time Economics | GDP Per Capita Unlikely to Get Back to Pre-Recession Level Until 2013
What has happened to the economy over the past five years is grim enough. When you look at it in the context of a growing population, it is even grimmer.

Health Care

Econ Comments & Analysis                                                                                            
RCM | The U.S. Needs a Vigorous Medicare Debate
Medicare is in trouble. The nonpartisan Congressional Budget Office's new cost estimates for Medicare, released last week in its new update to its Budget and Economic Outlook, raise projected Medicare spending by $136 billion over the next decade due to lower than expected productivity and higher than expected costs for goods and services.

Blogs                                                                                                                             
Heritage Foundation | How Obamacare Robs Medicare and Hurts Seniors
Obamacare cuts $716 billion from Medicare over the next 10 years, according to the Congressional Budget Office (CBO), and uses these “savings” from Medicare to fund other entitlement expansions mandated by Obamacare.

Monetary

News                                                                                                                             
Bloomberg | ECB Said to Urge Weaker Basel Liquidity Rule on Crisis Risks
The European Central Bank is pushing global banking regulators to relax a draft liquidity rule so that lenders can use some asset-backed securities and loans to businesses in a buffer they must hold against a possible credit squeeze, according to three people familiar with the talks.
Market Watch | Euro-zone money-supply growth accelerates in July
Money supply across the 17 nations that share the euro grew faster than expected in July, data from the European Central Bank showed Tuesday. M3, the broadest measure of money supply, expanded at an annual rate of 3.8% in July, accelerating from 3.2% in June. Economists had forecast a 3.3% annual increase.

Econ Comments & Analysis                                                                                            
Forbes | The Top Ten Reasons That You Should Support the "Gold Commission"
What has gone largely unreported are ten reasons the American people should support the creation of a “gold commission.”

Blogs                                                                                                                             
WSJ: Real Time Economics | Fed Economists Play Down Effect of Cutting Interest on Excess Reserves
Lowering the interest rate the Federal Reserve pays on excess reserves wouldn’t have a meaningful effect on the overall money supply, two economists argued in a Federal Reserve Bank of New York blog post Monday.
Economics One | Which Simple Rule for Monetary Policy?
The discussion of "Simple Rules for Monetary Policy" at last week’s FOMC meeting is a promising sign of a desire by some to return to a more rules-based policy.

Taxes

News                                                                                                                             
WSJ | Industry Seeks Tax Fix
Lower and Simpler Rates Should Be Washington's Priority, Manufacturers Say.

Blogs                                                                                                                             
Tax Foundation | Monday Map: State and Local Tax Deductions
Today's Monday Map focuses on the deduction of state and local income or sales taxes from federal taxable income.

Employment

Econ Comments & Analysis                                                                                            
Heritage Foundation | Unelected Unions: Why Workers Should Be Allowed to Choose Their Representatives
Unions negotiate workers’ terms of pay, promotion, layoff, and retirement; union members may not bargain for themselves. However, very few union members voted for this representation.

Blogs                                                                                                                             
AEIdeas | 4 charts that show the U.S. labor market is a long, long way from being back to normal
"U.S. labor markets have recovered 4 million of the nearly 9 million net job losses from the early 2008 peak. …"

Budget

News                                                                                                                             
WSJ | Catalonia to Seek Aid From Madrid
The regional government in Catalonia said Tuesday it will ask for around €5 billion ($6.27 billion) in financial assistance from the central government, as the country's economic recession deepened in the second quarter and outflows from bank deposits hit a record high.
Bloomberg | Spanish Recession Deepens as Austerity Damps Outlook: Economy
Spain’s recession worsened in the second quarter as the government’s austerity push to reduce the euro area’s third-biggest budget deficit and a slump in consumer spending offset growth in exports.
Politico | $8 billion surprise grist for new spending fight
...to the surprise of many, the agency now says it represents an $8 billion increase from what it calculates the current rate of discretionary spending, $1.039 trillion.

Econ Comments & Analysis                                                                                            
Bloomberg | Social Security’s Woes Are Worse Than You Think
On both left and right, the politicians and the experts are saying the U.S. needs to fix Medicare -- and have made fixing Social Security an afterthought.
Heritage Foundation | How Arms Controllers Would Reach a Budget Agreement
America is never going to fix its structural fiscal problems until we recognize that we face a political science problem more than an economic policy problem.
CNN Money | Where's all that government spending really going?
So where are the new trillions in spending really going? To find out, let's start with the total increase in outlays.

Blogs                                                                                                                             
Political Calculations | The Recession And Social Security Disability
Picking up on recent comments by Russ Roberts on the changes in the disability rolls over time, we thought we might revisit Social Security's data on the number of disabled workers collecting disability benefits for the years corresponding to the Great Recession.
NRO: The Corner | More Evidence That Spending Cuts Are the Best Way to Shrink Our Debt
As I have explained in the past, increasing taxes on rich people is unlikely to address concerns about income inequality.
Keith Hennessey | The “insufficient detail” critique of the Ryan budget
Dr. Orszag’s principal critique is that the Ryan budget is short on details.

Monday, August 27, 2012

General Economics

News                                                                                                                             
Bloomberg | German Business Confidence Falls for a Fourth Month
German business confidence fell for a fourth straight month in August as the sovereign debt crisis curbed growth in Europe’s largest economy.
WSJ | Businesses Rein In Big-Ticket Spending
A closely watched gauge of business investment dropped in July for the second month in a row, suggesting companies are growing more cautious about the economy.
CNN Money | Energy to keep booming no matter who's president
Despite the vicious political attacks over energy policy in the United States, the recent boom in oil and gas production will likely continue, no matter who wins the White House.
Bloomberg | Homebuilding Revival Sparks Rush for Best California Land
The nascent recovery in new-home sales has U.S. builders rushing to buy up a diminishing supply of well-located, ready- for-construction land.
Market Watch | Regulators say loan credit quality improving
The credit quality of large loan commitments owned by financial institutions regulated in the U.S. improved in 2012 for the third consecutive year in 2012, according to a review by the Federal Reserve and two other regulators released Monday.

Econ Comments & Analysis                                                                                            
RCM | Exaggerated Rumors of Middle Class Demise
The idea that anyone can "save" the middle class assumes that it's in danger of disappearing, which it isn't, and that presidents possess sufficient powers to resurrect it, which they don't.
AEI: American | The Next Great Growth Cycle
Today’s techno-pessimists say technology and America have plateaued. Such naysayers flourish during economic recessions. They have been wrong in every one of the 19 economic downturns we have experienced since 1912. They’re wrong again.
RCM | You Call This An Economic Recovery?
Yes, the economy is technically growing, and corporate profits are up. But the pace of growth during the Obama "recovery" has been so slow that it's leaving most Americans further behind.
Politico | Obama's false sense of fairness
We now know that the president thinks it’s fair to redefine the work requirements for the welfare program to include bed rest and helping neighbors run errands.
Forbes | If You Want Human Progress To Stop, Institute A Maximum Income
Similarly, we should give those who have earned great wealth honestly the respect and gratitude they deserve for the enormous value they’ve created. That would be real economic fairness.
Fox News | Why we are on the brink of the greatest Depression of all time
This time we are in such deep trouble, the only solution is a radical restructuring of the politicians, the economy, and the way we view personal responsibility versus government handouts.
Washington Times | GHEI: Twisting red tape
When Uncle Sam knocks at the door saying he’s here to help, watch out. He has hired an army of bureaucrats to devise thick stacks of papers and studies that claim federal intervention is just what the marketplace needs.

Blogs                                                                                                                             
The Economist | R&D: how low can you go?
Overall, this secular shift was pretty successful in the America: private firms have upped their innovation efforts, so that there are lots of businesses that will soon spend over $10 billion on R&D each year.
Calculated Risk | Unofficial Problem Bank list declines to 898 Institutions
The Unofficial Problem Bank List holds 898 institutions with assets of $346.7 billion. A year ago, the list held 988 institutions with assets of $415.9 billion.
Greg Mankiw's Blog | Polarized People says Pew – not so says Pew data
The Pew Research Center published a study in mid-2012 that claimed increased polarization among the American public along political party lines.
Calculated Risk | Schedule for Week of Aug 26th
The most anticipated events this coming are the speeches by Fed Chairman Ben Bernanke (Friday) and ECB President Mario Draghi (Saturday) at the Jackson Hole Economic Symposium.

Health Care

News                                                                                                                             
National Journal | Report Gives Obama New Weapon Against Romney in Medicare Wars
President Obama has sought to win over older voters by warning them that Mitt Romney's plan for Medicare would cost them an extra $6,400 a year in health premiums.

Blogs                                                                                                                             
Keith Hennessey | Responding to some of President Obama’s Medicare claims
Medicare, Social Security, and Medicaid are growing at unsustainable rates. The “millions of Americans who are working hard right now” are paying taxes into a system that will be unable to afford to pay the benefits it is promising them today.

Monetary

News                                                                                                                             
CNN Money | Investors and economists agree: No QE3
NEW YORK (CNNMoney) -- More stimulus from the Federal Reserve would probably boost the stock market, but regardless, both investors and economists agree: They don't want QE3.
Bloomberg | Jackson Hole May Disappoint Investors Primed for Stimulus
Federal Reserve Chairman Ben S. Bernanke -- returning this week to the scene of a 2010 speech that foreshadowed a second round of quantitative easing -- probably will disappoint investors looking for him to signal new stimulus.
WSJ | Bernanke Letter Defends Fed Actions
There is scope for further action by the Federal Reserve to ease financial conditions and strengthen the recovery.

Econ Comments & Analysis                                                                                            
Market Watch | Chicago Fed's Evans calls for immediate action
In a speech in Hong Kong, Chicago Fed President Charles Evans said the central bank should make open-ended purchases of mortgage-backed securities until the economy shows clear signs of improvement, such as a steady drop in unemployment for two or three quarters.

Blogs                                                                                                                             
AEI | Is inflation really a huge problem right now?
Inflation has been a big economic problem in the past. It may be again in the future.
Marginal Revolution | Which countries benefit the most from euro depreciation?
Based on these calculations, Ireland is a clear first. Pulling up the rear are Italy, France, Greece, and Portugal comes in last. Note that these calculations assume a kind of average/marginal equality.
Smart Money | What Fed Action Would Mean for the Dollar
When the Federal Reserve hinted Wednesday more stimulus could be on the way, the dollar sunk. While it remains unclear how or when the Fed might act, investing pros say it may still make sense to dial back on the greenback.

Taxes

Econ Comments & Analysis                                                                                            
Fox Business | Your Taxes Have Already Been Raised
When the government announces that it is printing money to stimulate the economy, you should interpret that as “the cost of what I use every day in my life just got more expensive.”

Blogs                                                                                                                             
Heritage Foundation | Are Spending Cuts as Harmful as Tax Increases?
Wednesday’s warning by the Congressional Budget Office (CBO) that the fiscal cliff is likely to push the economy back into recession should bring things sharply into focus for lawmakers.