Tuesday, July 24, 2012

General Economics

News                                                                                                                             
WSJ | Spain's Economy Contracts
Spain's economy weakened further during the second quarter, hit by a sharp drop in domestic demand and by intense volatility in financial markets, the Bank of Spain said Monday.
WSJ | Home Prices Reflect Strengthening
Home prices in the second quarter rose from the year-ago period for the first time since 2007, according to a closely watched index, the latest indication the housing market is starting to recover.
WSJ | Euro-Zone Business Output Falls
Business activity in the euro zone contracted for the sixth straight month in July, a closely watched survey showed, with powerhouse Germany weakening and the government in Greece now predicting an even deeper economic recession for this year.

Econ Comments & Analysis                                                                                            
Forbes | Dear President Obama, You Can't Create Growth, But You CAN Suffocate It
Actually, Mr. President, the Declaration says that “all… are created equal,” implying equality of opportunity not equality of outcomes, not “all of us are equal.”  A nuance, perhaps, but a critical one. 
NY Post | ‘Too big to fail’ grows
The two-year anniversary of Dodd-Frank has come and gone, and Too Big To Fail is only growing.
Washington Times | Obama ignoring immediate economic fixes
Last month’s dismal jobs report underscored what many across the United States have known for sometime — the economic recovery remains damagingly substandard. With unemployment at 8.2 percent — and real unemployment (counting those who have left the labor force) in double digits — confidence in the economic prospects for 2012 are reaching new lows, while uncertainty among America’s businesses and jobs creators is at an all-time high.
FOX News | The coming economic collapse
The U.S. economy is teetering on the brink of another recession. The bad news is that if it goes down again, there won’t be much we can do to save ourselves. Like a weary heavyweight, if it hits the mat again, it’s down for good.
Politico | Washington isn’t broken — just broke
All of America’s problems, the liberal theory goes, are due to gridlock in Washington, and that’s due to conservatives who refuse to compromise.

Blogs                                                                                                                             
Neighborhood Effects | Fewer Government-Granted Privileges Means More Economic Growth
When governments dispense privileges to particular firms, businessmen and women learn to play politics. They lobby, campaign, and engage in other political activity in order to obtain and maintain privileges.
WSJ | Can’t Spell ‘Uncertain Outlook’ Without E-U-R-O
All eyes are once again on the euro zone. This week, Spain takes the spotlight, although Greece and Italy are still on stage. Monday’s increase in the yield on 10-year Spanish debt fanned fears that Spain will need a huge bailout, clobbering risk-on assets and boosting demand for safe-haven securities.
Daily Capitalist | Poverty Highest Since 1965
While one could quibble about comparisons to the poor in the U.S. versus other countries, the fact remains that the data tell us that people are slipping backwards. I don’t believe it’s fair to criticize the poor for their predicament.

Health Care

Blogs                                                                                                                             
Political Calculations | The Tax Burden of ObamaCare
Upon which income earners will fall the greatest burden of paying the greatest tax burden from the Patient Protection and Affordable Care Act (aka "ObamaCare")?

Monetary

News                                                                                                                             
The News | Bank of Japan head keeps monetary policy easy
The Bank of Japan will stick to an ultra-easy monetary policy, Governor Masaaki Shirakawa said on Monday, without telling whether further easing was planned, though the government warned that a strong yen and China’s slowing growth posed risks to the economy.

Taxes

Econ Comments & Analysis                                                                                            
WSJ | The Rights and Wrongs of Taxing Internet Retailers
Since the Supreme Court's 1992 decision in Quill Corp. v. North Dakota, states may not require retailers to collect sales taxes from online retailers unless those retailers have a physical presence in the taxing state. With their budgets increasingly strained, however, states are now asking Congress to allow them to do so.

Blogs                                                                                                                             
Tax Foundation | Response to the $21 trillion Tax Avoidance Study
Whether or not the $21 trillion figure is accurate or not, we should not be surprised that taxpayers who have the means, and who live in countries with very progressive tax systems, will try to shelter some of that income from those high rates.

Employment

News                                                                                                                             
CNN Money | Tons of trucking jobs ... that nobody wants
During tough economic times with high unemployment, Americans should be jumping at any chance to work, but trucking companies are struggling to hire drivers.
CNN Money | Cisco cuts 2% of workforce
Cisco said Monday it will cut 1,300 jobs, or about 2% of the company's global workforce.

Budget

News                                                                                                                             
WSJ | Geithner Urges Quick Action on Debt Crisis
Treasury Secretary Timothy Geithner Monday warned German leaders against leaving Europe teetering on the edge of financial disaster while trying to force troubled neighbors to overhaul their economies, saying such a strategy will be more costly financially and politically for Europe.

Blogs                                                                                                                             
Neighborhood Effects | The Ravitch Volker report: State Budget Crisis is Real
The recession of 2008 pulled the mask off of state budget pathologies that had been identified as institutional weaknesses in the decades leading to the crisis.
AEI | Time’s up on public pensions
Since 2009, I’ve been arguing that pensions for state and local government employees face multi-trillion dollar funding shortfalls, which are hidden using accounting rules that are far laxer than those applied to private sector pension plans or public sector plans in Canada or Europe.
WSJ | Why Are Entitlements Growing? Your Budget Questions Answered
David Wessel’s essay in the Saturday editions of The Wall Street Journal, an adaptation of from his new book, “Red Ink,” prompted a lot of comments and several questions from readers. Here are Wessel’s answers to a few of the questions.
Political Calculations | The Crushing Burden of Old Debt
Italy is the eighth largest economy in the world and the second-biggest manufacturing economy in Europe. The Italian government's tax collections from year to year have been near rock-steady as a percentage share of the country's GDP and, for over a decade now, the country has been running comparatively small annual budget deficits.
AEI | Does the EU have a debt crisis or a nominal GDP crisis?
It’s the NGDP, not the debt. A market monetarist perspective on the eurozone debt crisis would focus on the fact that the ECB has been negligent in providing a backdrop of reasonable NGDP growth.
Keith Hennessey | Lame Ducks and Fiscal Cliffs (part 1)
This is the first of a few posts on the policy decisions stacking up for the end of this year.  In this post I will simply list the moving parts, deadlines and timeframes, and which election scenarios are most important to analyze.  To some extent this is just a setup post for strategic analysis to follow over the next few days.