Thursday, June 21, 2012

General Economics

WSJ | Moody's Upgrades Turkey
Turkish assets leapt higher Wednesday as Moody's Investors Service announced a long-awaited upgrade to Turkey's sovereign debt rating, citing the country's improving public finances and steps taken by Ankara to address its external imbalances.
Bloomberg | Samaras to Name New Greek Government as EU Ministers Meet
Greek Prime Minister Antonis Samaras will announce the Cabinet members of his government today after securing agreement on a coalition that will seek relief from austerity measures tied to international loans.
CNN Money | Worsening wealth inequality by race
White Americans have 22 times more wealth than blacks -- a gap that nearly doubled during the Great Recession.
Bloomberg | Manufacturing Slump Deepens From Euro Area to China: Economy
Euro-area manufacturing output shrank at the fastest pace in three years in June and a Chinese output gauge indicated contraction as Europe’s worsening fiscal crisis clouded global economic-growth prospects.
WSJ | Notes From the Education Underground
The U.S. is stress-testing Herbert Stein's law like never before, but maybe the economist's famous dictum—trends that can't continue won't—is being vindicated in education. Witness the support of America's mayors for "parent trigger," the public school reform that was denounced as radical only a few years ago but now is spreading across the country.
WSJ | Fed Warns of Risk to Economy
Federal Reserve officials extended their efforts to boost the sluggish U.S. economy and said they were ready to do more if necessary to spur job growth.

Econ Comments & Analysis                                                                                            
Politico | Financial regulation sans analysis
The financial crisis destroyed trillions of dollars of wealth, yet federal regulators are implementing the 2010 Dodd-Frank law, intended to prevent the next crisis, with virtually no quantitative economic analysis.
Barrons | Computerizing the Campus
The American Dream is increasingly blocked by steadily rising college costs, and America's student debt stands at more than $1 trillion. Fortunately, the combination of readily available technology and a simple regulatory change could create a low-cost or even a no-cost alternative path toward a college degree.
Market Watch | U.S. CEOs less optimistic about economy
The leaders of America’s largest companies are turning more cautious about the U.S. economy’s growth prospects.
Politico | Opening federal lands for energy
There’s a domestic energy resurgence in parts of our country just like the California Gold Rush of 1848. But today’s Sutter’s Mill is in the Williston Basin in North Dakota and the Utica and Marcellus formations in the Midwest and Eastern United States.
Real Clear Markets | Pipelines: The Safest Way to Move Fuel
The administration appears unwavering in its decision to block construction of the Keystone XL Pipeline, which would bring oil from Canada, our closest trading partner, to American refineries in the Gulf of Mexico.
Bloomberg | The One Man Who Can Save Europe
The European Union’s audacious policy of not having a policy to deal with its economic crisis has almost run its course.

Political Calculations | Explain This Chart!
In this chart, we observe that the ratio of the U.S. National Average Wage Index starts off at a level 127.3% of the U.S.' GDP per Capita in 1951, slowly rises to peak at 137.8% of GDP per Capita ten years later in 1961, then falls steadily for the next three decades until 1994 when it flattened out at around 88.3% of the U.S.' GDP per Capita.
Keith Hennessey | It’s not just the economy, stupid
James Carville’s line from the 1992 campaign, “The economy, stupid,” may be too narrow this year. Yes, the domestic economy is the most important subject for the election.  But the U.S. economy may not be the only subject this fall, and if we drill down further we can find complexities beyond the simplistic political analysis of “Economy bad, incumbent loses.” President Obama’s economic campaign challenge is multidimensional.
AEI | The Big Downgrade: Federal Reserve slashes 2012 economic forecast
Economists across Wall Street have been cutting their 2012 economic forecasts, and now the Federal Reserve has gotten in the act.
Economist | Germany, Greece and the Marshall Plan, a riposte
I have read with great interest Mr Ritschl’s criticism of my article in the New York Times, in which I argued that Marshall aid to West Germany was low compared to the outside world's recent assistance to Greece.

Health Care

WSJ | Health-Care Tax Credit Eludes Some
Hundreds of thousands of small businesses are excluded from claiming a health-care tax credit, and many blame overly narrow restrictions.

Econ Comments & Analysis                                                                                            
Fortune | Health care reform: Freedom for disgruntled workers?
If the Affordable Care Act, or even parts of it, is upheld, Americans will be able to opt for health care outside of their job. How will employees respond?


Washignton Times | Bernanke: Bond buys an option if economy sours
Federal Reserve Chairman Ben S. Bernanke said Wednesday that the Fed is open to another round of bond purchases to lower long-term interest rates and boost growth if the job market doesn’t improve.
Bloomberg | Bernanke Signals More Easing Likely if Job Growth Wanes
Chairman Ben S. Bernanke is signaling the Federal Reserve will probably add to its record stimulus should the economy fail to make sufficient progress in creating jobs for 12.7 million unemployed Americans.
Politico | Fed: $267B more to Operation Twist
The Federal Reserve announced Wednesday it is committing $267 billion for continuing Operation Twist, the central bank’s program to keep long-term interest rates low and stimulate the economy.

Econ Comments & Analysis                                                                                            
WSJ | Twist and Pout
In addition to the tax cliff facing the economy in January, you can now add a monetary ledge. The Federal Reserve added that extra uncertainty by announcing Wednesday that it will extend its Operation Twist bond swap program by another $267 billion and through the end of the year.
NY Post | Fed up with Bernanke
I know Ben Bernanke isn’t stupid — so I don’t know why he is acting like a fool. The Federal Reserve chairman yesterday said — again — that he would extend a program aimed at keeping long-term interest rates low.
Smart Money | Kiss the Euro Goodbye
Don't be fooled by a rallying stock market, where blind hope that a dollar-deluging Federal Reserve will come to its rescue has trumped fundamental analysis these past two days.
CATO | It's the Money Supply, Stupid
One doesn't have to delve deeply into the mysteries of money to realize that money matters. But, you wouldn't know it from reading the deluge of polemics on whether a fiscal stimulus is, or is not, the proper prescription for most of the world's economies.

WSJ | Parsing the Fed: How the Statement Changed
The Federal Reserve releases a statement at the conclusion of each of its policy-setting meetings, outlining the central bank’s economic outlook and the actions it plans to take.
Economist | The limits of the unconventional
In an era when the word  "policy" is usually closely followed by "paralysis", it's of some comfort that at least one organization is willing and able to move when circumstances require.
Calculated Risk | Bernanke Paves the Way for QE3 on August 1st
At the January press conference, Fed Chairman Ben Bernanke hinted at further accommodation (QE3) based on incoming data.
WSJ | How Effective Have Fed Moves Been?
The Federal Reserve has a host of options on the table as it meets today, and market expectations are running high that it will do something.


CNN Money | Partisan reality check on tax reform
An analysis from Senate Democrats released Wednesday found that many in the middle class could pay more under a House Republican tax reform proposal than they do today, while the uber-rich would pay less.

Econ Comments & Analysis                                                                                            
Washington Times | Power to tax, power to destroy
It has been nearly 200 years since Chief Justice John Marshall struck down a Maryland tax with the observation, “The power to tax involves the power to destroy.” Many things have changed since 1819, but that truth is not one of them.

Heritage Foundation | Taxmageddon Is Slowing the Economy Now
The uncertainty caused by Taxmageddon—the one-year $494 billion tax increase that looms on January 1, 2013—is strong enough to slow the economy months before it actually strikes. In fact, it is already doing so.
AEI | Should we eliminate corporate income taxes and raise capital gains taxes?
How about this: a top tax of 28% — back to where it was in 1986 under bipartisan tax reform and close to Obama’s Buffett Rule — on all income along with an elimination of corporate income taxes? Any takers? Any suggested modifications?


Market Watch | U.S. jobless claims barely changed in latest week
The number of Americans who filed requests for jobless benefits fell by 2,000 last week to 387,000, indicating little change in labor-market conditions.
Politico | Labor targets the Midwest
In the wake of the failed Wisconsin recall attempt, unions are forging ahead with their 2012 battle plan, pouring cash and resources into Michigan, Wisconsin, Iowa, Indiana, Minnesota and Ohio in an effort to recapture ground lost when Republicans made sweeping gains in the 2010 midterm elections.

Econ Comments & Analysis                                                                                            
WSJ | How Skilled Immigrants Create Jobs
President Obama thrust immigration back into the spotlight last week with his executive order halting deportations for certain young illegal immigrants. In the context of America's jobs crisis, however, this is the wrong immigration issue to focus on.
CATO | The Negative Effects of Minimum Wage Laws
These laws prevent employers from paying wages below a mandated level. While the aim is to help workers, decades of economic research show that minimum wages usually end up harming workers and the broader economy.


National Journal | Where Is Congress With Appropriations?
Both the House and the Senate appropriations committees are off to strong starts in the appropriations process for fiscal 2013. Will both chambers pass all 12 major bills before the end of the current fiscal year on Sept. 30? Probably not.

Econ Comments & Analysis                                                                                            
CRS | Credit Union Commercial Business Lending: Key Issues for Legislation in the 112th Congress
Credit unions currently can make loans only to their members, to other credit unions, and to credit union organizations. In addition, there are restrictions in law on their business lending activities from which the credit union industry has long advocated for relief.
CBO | Status of Discretionary Appropriations: FY 2013 House
Estimates of discretionary budget authority and outlays for fiscal year 2013.
CATO | Austerity Works
As Greece, and now Spain and Italy, struggle with the crushing burden of debt brought on by the modern welfare state, perhaps we should shift our gaze some 1,200 miles north to see how austerity can actually work.