Tuesday, February 7, 2012

General Economics

News                                                                                                                             
CNN Money | Foreclosure deal has 40 states, but others balk
More than 40 states have signed on to a draft settlement with the nation's largest banks aimed at helping homeowners struggling with loans bigger than the value of their homes.
Market Watch | German December industrial output falls 2.9%
Industrial output in Germany unexpectedly plunged by a seasonally-adjusted 2.9% in December, the economics ministry reported Tuesday, after an upwardly-revised reading of unchanged in November.
CNN Money | Obama vs. Reagan: A tale of two recoveries
Faced with a strong jobs report Friday, Republicans tried out a new rhetorical message: This isn't a disaster, but Ronald Reagan could have done better.
Bloomberg | Farmers Plan Biggest Crops Since 1984
U.S. farmers will plant the most acres in a generation this year, led by the biggest corn crop since World War II, taking advantage of the highest agricultural prices in at least four decades.

Econ Comments & Analysis                                                                                            
Washington Times | Obama’s cash for condos
Though Fannie Mae and Freddie Mac sparked the housing collapse that crippled the economy, President Obama now wants them to play an even greater role.
Bloomberg | Americans Gaining Energy Independence
The U.S. is the closest it has been in almost 20 years to achieving energy self-sufficiency, a goal the nation has been pursuing since the 1973 Arab oil embargo triggered a recession and led to lines at gasoline stations.
New Republic | Stop Feeling Sorry for the Middle Class! They’re Doing Just Fine.
Commentators were right to point out that Mitt Romney committed a flagrant gaffe last week. Unfortunately, they were only half-correct in identifying the offense.
NBER | International Policy Coordination: The Long View
This paper places current efforts at international economic policy coordination in historical perspective.

Blogs                                                                                                                             
Heritage Foundation | Time for a Georgia-U.S. Free Trade Agreement
President Obama and President of the Republicof Georgia Mikheil Saakashvilirecently announced that the two countries should start free-trade negotiations. Let’s hope both presidents are serious.
CATO | CBO Forecast Accuracy
I noted last week that CBO’s new outlook assumes substantially lower interest rates, which appears to produce more than a trillion dollars of savings over the next decade.
National Review | The E.U. Contagion
It is hard to tell exactly how the European crisis will play out. I think we can predict that if Greece defaults on its debt, then Portugal is likely to be next.
The American | How Dodd-Frank is a big obstacle to closing down Fannie and Freddie
On Friday, Treasury Secretary Geithner said that the Obama administration is preparing to move forward with closing Fannie Mae and Freddie Mac and bringing back a robust private housing market. Ironically, the secretary’s statement was made almost one year to the day after the administration released its white paper on reform of the housing market.
Calculated Risk | The Housing Bottom is Here
There are two bottoms for housing. The first is for new home sales, housing starts and residential investment. The second bottom is for prices. Sometimes these bottoms can happen years apart.

Health Care

News                                                                                                                             
National Journal | Survey Documents Uninsured Families – and Offers Hope
The survey released on Tuesday found that families earning less than 133 percent of the federal poverty limit—about $30,000 a year for a family of four—were least likely of all income categories to be insured.

Blogs                                                                                                                             
CATO | Will States Lose Medicaid Funds If They Fail to Create an ObamaCare ‘Exchange’?
In recent weeks, officials from two states have claimed that if they do not set up an ObamaCare health insurance “Exchange,” the state will lose federal Medicaid or State Children’s Health Insurance Program funds.

Monetary

News                                                                                                                             
CNBC | SEC to propose new rules for money-market funds
The SEC looks to minimize any losses for shareholders of the money funds, which invest in short-term debt instruments. At least three of five SEC commissioners would need to approve the proposals to submit them for public comment, the newspaper said.

Econ Comments & Analysis                                                                                            
Market Watch | Salmon: Financial reforms shouldn't be scaled back
The Bank of England's Chief Cashier Chris Salmon on Tuesday refuted claims that reforms in the financial-services sector are "too ambitious" and need to be watered down due to the unsettled state of the economy.
MSN Money | All roads lead to inflation
To state the obvious, the Federal Reserve's announcement that it intended to keep the federal funds rate rates at zero longer than folks had expected was perhaps the biggest news of the past couple of weeks.
Forbes | The Federal Reserve's Explicit Goal: Devalue The Dollar 33%
After its latest two day meeting, the FOMC announced its goal to devalue the dollar by 33% over the next 20 years.  The debauch of the dollar will be even greater if the Fed exceeds its goal of a 2 percent per year increase in the price level.

Taxes

Econ Comments & Analysis                                                                                            
Washington Times | Payroll-tax problem
The president’s payroll-tax holiday took effect at the beginning of 2011. It reduced the Social Security withholding rate to 4.2 percent from 6.2 percent, giving the typical family an extra $40 per paycheck, according to the administration. The rationale is that people will spend this money and, in turn, increase the demand for goods and services, requiring companies to ramp up production and create new jobs.
WSJ | The Heartland Tax Rebellion
Oklahoma Governor Mary Fallin is starting to feel surrounded. On her state's southern border, Texas has no income tax. Now two of its other neighbors, Missouri and Kansas, are considering plans to cut and eventually abolish their income taxes.
Bloomberg | Zandi Says Failure to Extend Payroll Tax Cuts Would Reduce U.S. GDP in ’12
Economic growth in the U.S. will be reduced by 0.7 percentage point in 2012 if both programs aren’t extended through year-end, Zandi said in remarks to be delivered to the Joint Economic Committee of Congress today. If the programs are extended, the world’s largest economy will expand by 2.6 percent, he said.
Politico | Payroll tax cut extension a mess in the making
House Ways and Means Committee Chairman Dave Camp’s private assessment of the payroll tax debate is pretty bleak
WSJ | A Fairness Quiz for the President
President Obama has frequently justified his policies—and judged their outcomes—in terms of equity, justice and fairness. That raises an obvious question: How does our existing system—and his own policy record—stack up according to those criteria?
Kauffman Foundation | Capital Gains Tax Exemption for Investments in Startups Would Help New Companies Cross the ‘Valley of Death’ Says Kauffman Report
Permanent exemption could spur $750 million in additional annual seed investment, supporting the high-growth startups that create jobs

Blogs                                                                                                                             
Heritage Foundation | CBO Once Again Proves Tax Hikes Unnecessary to Lower Deficit
According to the CBO’s “Alternative Fiscal Scenario,” tax receipts will match their historical average in 2017, when revenue will be 18 percent of gross domestic product (GDP). Receipts will continue growing after that.
The American | Un-biasing the tax code
One of the biggest arguments regarding current tax rates is that they are an prohibitively high impediment to small business growth and creation, which, in turn, creates an impediment to job creation and innovation.
Tax Foundation | Monday Map: Sales Tax Exemptions for Groceries
Today's Monday Map shows how each state's sales tax treats groceries.

Employment

News                                                                                                                             
USA Today | Greek leaders will cut 15,000 jobs to get debt deal
Greece's coalition government said late Monday that it has accepted demands by its rescue creditors to cut 15,000 jobs in the public sector this year, under a new law that allows firings.

Econ Comments & Analysis                                                                                            
WSJ | A Bipartisan Plan for Job Creation
In his State of the Union Address, President Obama called on Congress to pass an agenda that helps start-ups and small businesses succeed. We have already introduced a plan that shares his goals. It's called the Startup Act.
Washington Times | Obama’s shovel-ready veterans
Last week, the White House proposed a new jobs program for unemployed veterans. The Veterans Jobs Corps (VJC) seeks to spend $1 billion to find work for 20,000 former servicemen.
Real Clear Markets | The Haze Surrounding the Unemployment Data
Economic data are subject to error, and employment statistics are no exception. Each month the employment figures are reported and discussed in the media down to the last digit as though blessed with divine perfection. But they're not.

Blogs                                                                                                                             
Reason Foundation | Unemployment at 8.3 Percent Not What It Seems
The Bureau of Labor Statistics released its unemployment number for January last Friday and the headline came in at 8.3 percent. Let's be clear—that's not a bad thing. Especially being down from 9.1 percent last year.

Budget

News                                                                                                                             
FOX Business | Greek Leaders Scramble Over Bailout; Unions Strike
Prime Minister Lucas Papademos negotiated through most of the night with Greece's European Union and IMF lenders, ending at 4 a.m. (10 p.m. ET) when the 24-hour strike was about to begin, closing ports and tourist sites and disrupting public transport.

Econ Comments & Analysis                                                                                            
AEI | Stimuless
Although our economic situation has been glacially improving, the recovery has been much slower than the Keynesians in the Obama administration promised.
CBO | Testimony on CBO's Appropriation Request for Fiscal Year 2013
Testimony before the Subcommittee on Legislative Branch, Committee on Appropriations, U.S. House of Representatives
Washington Times | The endangered balanced budget
Washington hasn’t seriously uttered the words “balanced budget” in years. Lawmakers now focus on trimming the budget deficit, which has soared to $1.3 trillion under President Obama.
WSJ | Budget Plan Has Familiar Ring
President Barack Obama will release his budget plan next week, calling for $3 trillion in deficit reductions over 10 years, including $1.5 trillion in tax increases to fall mostly on the wealthiest Americans.
AEI | Why the US doesn't have the debt problems of the EU
The crucial difference may be found in the relationship  between the subordinate political units and the central bank in each grouping.