News
Bloomberg | Bernanke Cliff Analogy Overstates Immediate Economic Harm
While the U.S. Congress views the convergence of more than $600 billion in tax increases and spending cuts set for Jan. 1 as a “fiscal cliff,” the metaphor misses the economic reality of what could follow.
Washington Times | Rate on U.S. 30-year mortgage ticks up to 3.34 pct.
Average U.S. rates on fixed mortgages ticked up this week just slightly above record lows, keeping home-buying and refinancing attractive to consumers.
CNN Money | Germany may fall into recession in 2013
Germany's central bank said the country may slip into recession early next year, confirming Europe's biggest economy has lost much of its immunity to the economic gloom pervading the region.
Bloomberg | Michigan Consumer Sentiment Declines More Than Forecast
The Thomson Reuters/University of Michigan preliminary consumer sentiment index decreased to 74.5, the weakest in four months, from 82.7 in November. Economists projected a preliminary reading of 82 for December, according to the median of 67 estimates in a Bloomberg survey.
WSJ | Cautious Companies Stockpile Cash
U.S. companies were sitting atop a record pile of cash at the end of September, but have slowed their saving as the economy has emerged from recession.
Bloomberg | Bundesbank Slashes 2013 German Growth Forecast to 0.4% on
The Bundesbank sliced more than 1 percentage point off its forecast for economic expansion in Germany next year after the sovereign debt crisis pushed the euro area into recession and global growth slowed.
Econ Comments & Analysis
WSJ | Energy Economics in One Lesson
America's shale gas boom is so promising that it has some people discombobulated—including, naturally, our politicians. The same folks who complain about America's trade deficit now want the U.S. government to ban the export of liquefied natural gas (LNG). This is one way to ruin what has been a very rare piece of good U.S. economic news.
NBER | Estimates of the Trade and Welfare Effects of NAFTA
We build into a Ricardian model sectoral linkages and differing productivity levels across sectors to understand how the gains from tariff reductions in a given sector spread to the rest of the economy. We also propose a new method to estimate sectoral trade elasticities consistent with any trade model that delivers a gravity trade equation.
Blogs
Economist | Forget the "fiscal cliff" and say hello to the "agriculture abyss"
Farm subsidies cost America’s government tens of billions of dollars each year, even though many farmers are earning more than ever thanks to high commodity prices. Little surprise, then, that with Congress desperate to avoid painful tax increases and spending cuts, both Republicans and Democrats are prepared to eliminate direct payments to growers.
