Friday, May 4, 2012

General Economics

Bloomberg | Chesapeake Seen Offering Biggest Gain in U.S. Shale Boom: Energy
Chesapeake Energy Corp. (CHK), battered by a glut-driven collapse in natural-gas prices and growing investor distrust of its management, still is the cheapest way of buying into the U.S. shale revolution.
Time | The Best and Worst States in America to Do Business
Chief Executive Magazine has released its annual list of best and worse states to do business, and Southern and Mountain-West states dominated the rankings — to the detriment of the two coasts.
CNN Money | Mortgage rates hit record lows
Average rates for both 15-year and 30-year fixed mortgages fell to new all-time record lows this week, according to a report released by Freddie Mac Thursday.
WSJ | Warning Signs Rise for Big Lenders in Asia
When Indonesian tanker operator B.L.T. froze payments on $2 billion of debt earlier this year, blaming a global economic slowdown, the default hit some of the world's biggest banks.
Bloomberg | AIG Plunges Most Since December as Sales Fall at Main Units
American International Group Inc. (AIG), the bailed-out insurer, plunged in New York trading after sales declined at its largest units.
National Journal | New Keystone Permit Application 'Imminent'
TransCanada spokesman Terry Cunha on Thursday confirmed a report that the company could reapply for a federal permit for the northern portion of the controversial Keystone XL pipeline “as early as Friday,” but would not say whether the application would necessarily come that day.

Econ Comments & Analysis                                                                                            
WSJ | College Grads Need Jobs, Not a Lower Loan Rate
President Barack Obama has been on a tour of college campuses touting proposals to lower student loan repayments for college graduates. He hopes to rekindle the enthusiasm of young voters, who in 2008 favored him over Sen. John McCain by more than two-to-one.
Market Watch | Boston Fed: Housing crisis wasn’t industry’s fault
The cause of the housing crisis wasn’t the financial industry deceiving mortgage borrowers and investors but instead overly optimistic beliefs about house prices, according to a research paper released by the Boston Fed.
Politico | Export-Import Bank deal appears near
House leaders appear to have settled on a framework to extend the Export Import Bank’s charter into 2014 and raise its loan exposure cap to $140 billion – a 40 percent increase.
Washington Times | Blaming energy futures for energy’s current costs
President Obama, doing his best imitation of a late 19th-century prairie populist, recently pinned the blame for rising gasoline prices on speculators in energy futures markets.

WSJ | World Food Prices Moved Lower in April
World food prices fell in April following three consecutive months of gains, pressured by declines in sugar, dairy and cereal prices that offset increases in oils and meat, the United Nations’ Food and Agriculture Organization said Thursday, but it warned that soybeans and corn could still drive prices higher later this year.

Health Care

National Journal | Health Insurers Highlight Low-Income Medicare Advantage Enrollees
Minority, rural, and low-income Medicare beneficiaries make up a significant portion of people using plans targeted for spending cuts, according to a report released by the health insurance industry Thursday.

CATO | Medicare Fraud Posse Cackles as If They Laid an Asteroid
So what is it about the government’s health care programs that make them such inviting targets for white collar criminals?
CATO | Alabama Gov. Vows to Veto ObamaCare Exchange
According to WSFA-12 News, Alabama legislators are working on legislation to create an ObamaCare Exchange.


Market Watch | Jobs report won’t move Fed, analysts say
While a big disappointment for the U.S. economy, Friday’s report showing weaker-than-expected job growth in April didn’t give the Federal Reserve any reason to move, some economists said.

Econ Comments & Analysis                                                                                            
CATO | Inflation Isn't the Point of Monetary Easing
Matt O’Brien has been doing some great coverage of monetary policy recently. He and I agree that the Fed ought to be pursuing a more expansionary monetary policy. However, I think his specific argument for monetary easing isn’t quite right

Economist | What Mario means when he talks about growth
The European Central Bank was playing away today, in Barcelona rather than Frankfurt, but the result would have been the same wherever its governing council met: a no-change score, with the main policy rate left at 1%.


National Journal | Consensus Emerging Among Experts on New Revenue as Part of Tax Reform
Politicians may be divided over the goals of tax reform, but consensus is emerging among some of the top tax-thinkers in Washington that any overhaul will have to include a revenue increase.

Minyanville | Why the Expiration of the Bush Tax Cuts Would Be an Implicit Austerity Measure
There was only one other time that tax revenues as a percentage of GDP grew materially faster than GDP, and that was during World War II.


Bloomberg | Gross Says U.S. Economy Suffering From ’Structural’ Unemployment
Bill Gross, manager of the world’s largest mutual fund, said U.S. unemployment is now a structural, and not cyclical, problem stemming from technology advances and the lack of retraining.

Econ Comments & Analysis                                                                                            
WSJ | College Grads Need Jobs, Not a Lower Loan Rate
President Barack Obama has been on a tour of college campuses touting proposals to lower student loan repayments for college graduates. He hopes to rekindle the enthusiasm of young voters, who in 2008 favored him over Sen. John McCain by more than two-to-one.
NBER | Hiring, Churn and the Business Cycle
Churn, defined as replacing departing workers with new ones as workers move to more productive uses, is an important feature of labor dynamics. The majority of hiring and separation reflects churn rather than hiring for expansion or separation for contraction.

Economist | The pace we've come to expect
For the second month in a row, America’s labour market has disappointed, once again raising questions about whether the economic recovery is truly entrenched.
WSJ | Why Did the Unemployment Rate Drop?
The U.S. unemployment rate dropped to 8.1% in April but a broader measure was unchanged at 14.5% and a separate survey noted that the economy added a paltry 115,000. Why the drop?


Econ Comments & Analysis                                                                                            
Bloomberg | Banks May Have to Disclose Profits From ECB Emergency Loans
Banks may have to disclose profits from carry trades derived from 1 trillion euros ($1.3 trillion) in European Central Bank loans and exclude the money from bonus pools, under draft proposals from European Union lawmakers.
Washington Times | Backdraft of overdrafts
Washington’s sole fiscal break, historically low interest rates, will soon end. When they do, higher debt-service costs will act like oxygen to the current conflagration of conflated debt. If you thought the budget blaze is hot now, wait and feel what is coming.