Wednesday, May 30, 2012

General Economics

Market Watch | Foreclosures level off in early 2012: CoreLogic
The inventory of homes in foreclosure has leveled off in the first four months of the year, according to a report from data firm CoreLogic Inc. released on Wednesday. The number of homes in the foreclosure inventory stood at 1.4 million at the end of April, compared to 1.5 million in April 2011 and 1.4 million in March.
WSJ | Housing Market Crawls Back
Housing prices across the U.S. fell in March, but not as much as in earlier months, according to a report Tuesday that offered fresh evidence of a real-estate market on the mend.
CNN Money | Home prices lowest since 2002
Average home prices were down 2.6% from 12 months earlier, according to the S&P/Case-Shiller home price index of 20 major markets. Home prices have not been this low since mid-2002.
WSJ | Spain's Economy Shows Fresh Strain
Spain's economy showed fresh strains as retail sales fell at a record pace in April, suggesting the country's recession is deepening as the government's austerity program curbs consumption.
Bloomberg | Euro-Area Economic Confidence Falls to 2 1/2 Year Low
Economic confidence in the euro area declined more than economists forecast in May to the lowest in 2 1/2 years after inconclusive Greek elections raised the specter of a euro breakup and Spain struggled to shore up its banks.
FOX News | Obama to sign renewal of Export-Import Bank
President Barack Obama is set to sign the reauthorization of the Export-Import Bank, the government's vehicle for promoting U.S. export sales.

Econ Comments & Analysis                                                                                            
Project Syndicate | France’s Broken Dream
The crisis in the eurozone is the result of France’s persistent pursuit of the “European project,” the goal of political unification that began after World War II when two leading French politicians, Jean Monnet and Robert Schuman, proposed the creation of a United States of Europe.
Bloomberg | Low, Stable Housing Prices: What’s Not to Like?
The Case-Shiller Housing Price figures for March were released Tuesday, and they reveal a second month of modest price increases.
Politico | The anti-free-enterprise president
President Barack Obama declared Tuesday, “This is what this campaign is going to be about.” He was not talking about jobs. He was not talking about the economy—not even about the budget deficit. He was referring to divisive, disingenuous character attacks against presumed GOP nominee Mitt Romney and a rhetorical assault on job creators.
WSJ | The Bain Ads Are About Spending
Who says Wall Streeters aren't filled with a desire to please? Two big-name Democratic financiers, Roger Altman and Steven Rattner, may not be ready to defend the president's deceitful Bain ads. But they promptly took to the airwaves to defend the president's defense of the ads, after President Obama himself issued a few syllables they could cling to, saying the ads merely questioned whether profit maximization is an appropriate governing principle.

Health Care

Politico | Medical device tax is questioned
A controversial health care reform tax due to go into effect next year has become a prominent issue in a number of House and Senate races throughout the country.

Econ Comments & Analysis                                                                                            
WSJ | There's a Medical App for That—Or Not
Even the most ideologically opposed politicians agree: Health care is choking on paperwork, and medicine is prone to errors of handwriting, lost information and guesswork.
NBER | Medicare Reimbursements and Shortages of Sterile Injectable Pharmaceuticals
This paper investigates the rise in shortages of sterile injectable pharmaceutical drugs in the United States. I focus on a policy change that occurred in 2005 that reduced Medicare Part B payments for sterile injectable drugs.


Econ Comments & Analysis                                                                                            
Fortune | It's time for Europe to choose inflation over austerity
If the EU's leading nations aren't willing to forgive the debt of their troubled bretheren, then maybe they need to start printing more euros.
Heritage Foundation | China Drowning in Money: What It Means for the U.S.
Global financial markets are keenly interested in China’s short-term economic direction and policy choices. American policy should look farther. If China chooses to try to stimulate its economy in the second half of the year, even if successful, it will only exacerbate a more pressing long-term challenge.


Politico | GOP softens anti-tax rhetoric
Cracks are emerging in the GOP’s hard-line stance against raising tax revenues to slash the deficit, with a number of Republicans willing to go further than their party’s standard-bearer in the face of a looming showdown over the budget.

Econ Comments & Analysis                                                                                            
Daily Caller | Shallow-loss programs could leave taxpayers in deep trouble
Imagine what would have happened if, at the peak of the housing bubble in 2006, Congress had passed a law guaranteeing that all homeowners could sell their property at close to its record price for the next five years, regardless of market conditions.

FOX Business | Why Taxing 'The Rich' Doesn't Work
If you want to understand politics, all you have to do is think back to third grade. Even at 8 years old, it was probably clear to you that the only reason the class bully picked on weak kids was because they were unable to defend themselves. That’s exactly the strategy driving proposals to raise tax rates on corporations and “The Rich.” 


WSJ | Flat U.S. Wages Help Fuel Rebound in Manufacturing
The celebrated revival of U.S. manufacturing employment has been accompanied by a less-lauded fact: Wages for many manufacturing workers aren't keeping up with inflation.

Econ Comments & Analysis                                                                                            
Real Clear Markets | Unemployment Is a Labor Market Mismatch
After an unexpected upswing at the beginning of this year, the labor market appears to be back in the doldrums again. The subsequent drop in the employment numbers to slightly more than 100,000 has left us scrambling for an explanation.

WSJ | Numbers Show China’s Still Working
In the midst of gloom about China’s economic outlook, new labor market data provides an optimistic counterpoint — and a possible explanation for why a long-anticipated stimulus has been slow to arrive.


Bloomberg | U.S. May Avert Plunging Over Fiscal Cliff in 2013
The U.S. will avoid plunging off a fiscal cliff in 2013, according to economists surveyed by Bloomberg News, as lawmakers find enough common ground in budget negotiations to avert a recession.
WSJ | U.S. Seeks Action on Europe Crisis
The Obama administration dispatched one of its top economic officials to Europe on Tuesday to press officials in Greece, Spain, France and Germany to calm a widening crisis that threatens to spark new trouble for the U.S. economy.
Politico | Politics of 2013 ‘fiscal cliff’ worries economists
Democrats and Republicans are trying to stir up votes for November by locking horns over the coming fiscal cliff, but they’re stirring up just as much anxiety among economists who fear that the rhetoric upsets consumer confidence and squashes the stock market.
Bloomberg | EU Weighs Direct Aid to Banks, Euro Bonds as Crisis Antidote
The European Commission called for direct euro-area aid for troubled banks, and touted a Europe- wide deposit-guarantee system and common bond issuance as antidotes to the debt crisis now threatening to overwhelm Spain.

Econ Comments & Analysis                                                                                            
WSJ | A Fiscal Union Won't Fix the Euro Crisis
Increasingly, euro-zone hardliners have called for putting in a disciplined, unified fiscal arrangement similar to the one we have in the U.S. Unfortunately, their vision of fiscal union has badly missed the essence of the U.S. experience and would not fix the euro crisis.
CATO | We Can Cut Government: Canada Did
Two decades ago Canada suffered a deep recession and teetered on the brink of a debt crisis caused by rising government spending. The Wall Street Journal said that growing debt was making Canada an “honorary member of the third world” with the “northern peso” as its currency. But Canada reversed course and cut spending, balanced its budget, and enacted various pro-market reforms.

National Review | Public Pensions and Rosy Projections
Last week, my collegue Eileen Norcross produced a chart that underlies a very scary unreported threat for many municipal budgets around the country. In this particular case, the chart showcases the Warwick, R.I.’s municipal budget
Political Calculations | Economic Growth and the Chains of Debt
What we see is that high levels of national debt with respect to the size of a nation's economy, would appear to have a medium-strength effect upon its real rate of economic growth. For every 10% increase in a country's national debt with respect to its GDP, it would appear that its real economic growth rate is reduced on average by roughly 3/8th of a percent.