Tuesday, June 26, 2012

General Economics

News                                                                                                                             
FOX News | Moody's cuts debt ratings of 28 Spanish banks
The rating agency said that it is cutting its views on the debt issued by 28 Spanish banks, including international heavyweights Banco Santander and Banco Bilbao Vizcaya Argentaria.
CNBC | Gas Prices Are a Silver Lining for Wobbly Economy
The national average for regular gasoline has fallen 9 cents in the past week to $3.41, according to AAA. Gasoline was $3.65 a month ago and $3.935 a gallon when it peaked in April.
CNN Money | New home sales jump 7.6% in May
The housing market got some good news on Monday, as the government reported that sales of new homes rose 7.6% in May.
Bloomberg | Biggest U.S. Banks Curb Loans as Regional Firms Fill Gap
The biggest U.S. banks are extending less credit amid a faltering economic recovery as regional lenders step in to fill the gap.
NY Times | Report Predicts Huge Gap in Educated Workers
By 2020, there will be about 38 million to 40 million too few college and university graduates to satisfy the demands of the global labor market, a report issued this month has found
WSJ | New-Home Sales Reach 2-Year High
Sales of newly built homes climbed to the highest level in two years, driven by limited supply of previously owned homes and record-low mortgage rates.

Econ Comments & Analysis                                                                                            
WSJ | Shareholders Can Cure Too Big to Fail
There are many reasons people give for breaking up financial institutions that are "too big to fail." It would reduce their complexity, making it less likely they would fail in first place. And ending the government's implicit subsidies to these behemoths means they would no longer enjoy a lower cost of borrowing funds—a competitive advantage that now leads them to grow bigger.
NY Times | Fixing College
Setting aside the specifics of the Virginia drama, university leaders desperately need to transform how colleges do business. Higher education must make up for the mistakes it made in what I call the industry’s “lost decade,” from 1999 to 2009.
Mercatus | Beware the Surge: "Midnight Regulations"
History teaches us that the outcome of presidential elections is rarely certain, with one exception. A change in administration will be followed by a “lame duck” session, during which politicians are all-but freed from normal political constraints.
WSJ | Smearing Small Business
On the eve of the Supreme Court's ruling on ObamaCare, and with the Justices now presumably beyond political pressure, the liberal intimidation campaign has moved on to other targets. The latest is the small business lobby for having dared to join 26 states in challenging the law.
AEI | The Pension Benefit Guaranty Corporation: Who will guarantee this guarantor?
Defined-benefit pension plans are very difficult to finance successfully: That is why so many of them, both private and public, are deeply underfunded. It is also why they are a disappearing financial species.
Mercatus | Baselines
For more than three decades, executive branch agencies have been required to conduct regulatory impact analyses (RIAs) for all regulations deemed to be “economically significant.”

Blogs                                                                                                                             
National Review | Scott Winship on Income Mobility: Good News Edition
This is a great interview of Brookings Institution’s Scott Winship by Nick Gillespie of Reason TV about income mobility in America. As Winship’s work demonstrates, mobility is not declining in spite of evidence that income inequality is indeed growing (especially at the top end of the income distribution). 
AEI | Graphic of the Day: The economic catastrophe of a euro breakup
Well, this wouldn’t be good at all
Library of Economics | Mexico's Economic Growth
In the United States, the image of Mexico is abysmal and largely wrong. The average American seems to believe that Mexico is a destitute, quasi-socialist nation with rampant drug violence that is sending waves of illegal immigrants to the United States.

Health Care

News                                                                                                                             
National Journal | More Than 22 Million Could Lose Insurance With Supreme Court Decision
More than 22 million people who would have gotten cheaper health insurance or coverage from Medicaid will be out of luck if the Supreme Court overturns the entire health care law, according to analysis from consulting firm Avalere Health.
Politico | Health care ruling expected Thursday
The Supreme Court on Monday said that Thursday would be the last day it would release opinions. Rulings are expected in two cases, plus the closely watched decision on President Barack Obama’s health care reform law.
National Journal | HHS Tallies "Donut Hole" Savings
According to the Department of Health and Human Services, 5.25 million beneficiaries have saved a combined $3.7 billion on drug costs since 2010, thanks to discounts negotiated as part of the health care reform law.

Blogs                                                                                                                             
National Review | Health Care after the Supreme Court Ruling
Since it looks like we will find out on Thursday what the Supreme Court ruling on Obamacare will be, I have a few questions for experts on both sides of the political spectrum about its potential consequences.
Mercatus | The Fiscal Consequences of the Supreme Court's Healthcare Ruling
The Supreme Court's decision on the 2010 healthcare law may result in what appears to be a fiscal windfall for the federal government. But it would be a grave mistake for lawmakers to react to illusory savings with real new spending.

Monetary

Econ Comments & Analysis                                                                                            
CNBC | Pessimistic UK Central Bank Sees Outlook Worsening
The outlook for Britain's economy has worsened over the past few weeks due to turmoil in the euro zone and signs of deterioration in emerging markets, the Bank of England said on Tuesday.
CNBC | Dallas Fed’s Fisher Sees ‘Positive Momentum’
Dallas Federal Reserve President Richard Fisher brushed off concerns of looming deflationary pressures and told CNBC on Monday that he believed the U.S. economy is moving in the right direction.

Blogs                                                                                                                             
Minyanville | Operation Twist II: Project Escape Velocity
This week, the US Bureau of Economic Analysis will release the final reading on Q1 GDP.  By all accounts, it will reflect that the velocity of money will be at the lowest level in half a century. 

Taxes

News                                                                                                                             
Market Watch | Japan tax hike approved despite rebellion
The lower house of Japan’s parliament voted Tuesday in favor of a controversial bill to double the consumption-tax rate to 10% by 2015, likely setting in motion a chain of events that could split the ruling party and lead to early elections.

Employment

Econ Comments & Analysis                                                                                            
Forbes | Crowdsourcing a New Report On Government Job Destruction
When the government issues the June employment report on July 6th, the one data point that will be missing is the number of jobs that have been lost – or never created – because of government regulatory, tax and monetary policies. 
WSJ | Employment, Italian Style
Prime Minister Mario Monti has issued a new "growth decree" to revive Italy's moribund economy. Among other initiatives, the 185-page plan proposes discount loans for corporate R&D, tax credits for businesses that hire employees with advanced degrees, and reduced headcount at select government ministries.

Blogs                                                                                                                             
Café Hayek | Moretti on jobs and cities
The latest EconTalk is Enrico Moretti talking about his new book, The New Geography of Jobs. Lots of interesting observations about the impact of education on how cities grow

Budget

News                                                                                                                             
Market Watch | Plan would give EU national budget powers: report
European leaders meeting later this week will consider a plan that would allow the European Union to rewrite national budgets for euro-zone countries that fail to meet debt and deficit rules, the Financial Times reported Tuesday, citing a draft report.
Bloomberg | Congress Said to Delay Automatic Budget Cuts Until March
Republican and Democratic congressional leaders are weighing whether to delay automatic federal spending cuts until March 2013, according to a House aide and industry officials who were briefed on the discussions.

Econ Comments & Analysis                                                                                            
Real Clear Markets | Message to Europe: Government Spending IS Austerity
A Wall Street Journal headline from last month, "Europe, in Slump, Rethinks Austerity", captures well the binary view of economic growth at the moment: spend or recess.
Washington Times | Constitutional fix to overspending
Tea Party members are going to be very unhappy. Many of the new members of the House and Senate that the Tea Party helped elect are already becoming part of the political class, as evidenced by their votes for continued farm subsidies, refusals to put reasonable limits on the growth of the food- stamp program, support for unaccountable international organizations, and on and on.