Friday, August 10, 2012

General Economics

CNN Money | Fiscal cliff threatens small businesses
Potential massive cuts in federal spending are still months away, but some small businesses that rely on government contracts are already feeling the pinch.
WSJ | Debate Over 'Fiscal Cliff' Weighs on Growth
Dithering in Washington over the "fiscal cliff" of automatic tax increases and spending cuts set for year-end is already hindering economic growth, according to economists surveyed by The Wall Street Journal.
Politico | Confidence in economy slips, poll suggests
Americans don’t think the economy is improving and they don’t believe Mitt Romney or President Barack Obama can help them, according to a new CNN/ORC International Poll.
Bloomberg | U.S. Consumer Bureau Proposes New Rules on Mortgage Servicing
The U.S. Consumer Financial Protection Bureau today proposed new regulations that would revamp how American homeowners interact with mortgage servicers.
CNN Money | Corn prices rally to new record high
Corn prices climbed to a record high Thursday, staging a fresh rally as investor gear up for the U.S. government's latest snapshot on corn production due Friday morning.

Econ Comments & Analysis                                                                                            
Market Watch | Years of paltry growth ahead, top forecaster says
Economist Ellen Zentner is obsessed with finding any tiny advantage when it comes to forecasting the weekly and monthly economic data that move financial markets the most.
WSJ | Why the Dismal Science Deserves Federal Funding
The federal deficit has ballooned in recent years, and even larger deficits are coming due to the expected growth of entitlement spending. There is little disagreement among members of both political parties that federal spending should be reduced. In such an environment it is crucial that the right criteria guide the cuts that will be made. Across-the-board cuts are not a thoughtful way to make choices.
Washington Times | Cut big business’s corporate welfare
With the federal government closing in on its fourth consecutive budget deficit in excess of $1 trillion, the national debt is hurtling toward dangerous levels. If the nation is to avert a debt crisis, federal policymakers need to aggressively balance revenues. Business subsidies, or “corporate welfare,” are a good place to start.
Market Watch | Forget Knight, there is no investor confidence
Last week’s implosion of Knight Capital, the biggest market maker in U.S. equities, created anxiety among traders and investors alike. The latest in a series of electronic blow-ups and glitches, it again raised the question of how reliable markets are in an age of high-frequency trading.
WSJ | Eminent Soundness
Edward DeMarco has done yeoman work for taxpayers as the chief regulator for Fannie Mae and Freddie Mac, and this week he did another good deed by sounding an alarm against cities that want to use eminent domain to seize underwater mortgages.

WSJ | Secondary Sources: Generation Rent, Confidence, Economics of Spam
A roundup of economic news from around the Web.
Economist | Baby monitor
The Free Exchange in this week’s print edition looks at an unfamiliar aspect of inequality: inequality in poor countries. There is plenty of debate about inequality in rich countries; much of the discussion focuses on the impact of traditional macro-economic factors, such as skills and wages, tax policy and so on. Inequality in poor countries is less often examined, and so is the factor which is the main subject of the column this week: demographic change.
Library of Economics | Greenspan Embraces "Regime Uncertainty" Explanation
One of the unusual features of the current recession is the long persistence of high unemployment. Despite the claims of Carmen Reinhart and Kenneth Rogoff, deep recessions accompanied by financial panics are usually followed by steep and rapid recoveries, at least in U.S. history, with the exception of the Great Depression.

Health Care

Heritage Foundation | The American People Want Obamacare Repealed
After the Supreme Court ruling that upheld most of his health care law, President Obama claimed that the decision was a “victory for people all over the country.” However, public opinion polls that show that a majority of Americans don’t want Obamacare.
CATO | Written Testimony on the Illegal IRS Rule to Increase Taxes & Spending under Obamacare
The written testimony that Jonathan Adler and I submitted for the House Oversight Committee hearing on the Internal Revenue Service’s unlawful attempt to increase taxes and spending under Obamacare is now online.
Heritage Foundation | Don’t Expand Medicaid—One-Third of Doctors Are Already Opting Out of It
A new study reveals that nearly one-third of doctors nationwide are unwilling to accept new Medicaid patients.


Bloomberg | What’s Fed to Do as 15 of 18 Banks Fixing Libor Aren’t American
Mark Calabria at the Cato Institute usually isn’t shy about criticizing Timothy F. Geithner. Yet he says it was ultimately up to the British to deal with the manipulation of Libor, as only three of the 18 banks that set the London interbank offered rate are based in the U.S.
Bloomberg | Import Prices in U.S. Unexpectedly Fell in July for Fourth Month
Prices of goods imported into the U.S. unexpectedly fell in July for a fourth consecutive month, reflecting lower costs for fuel and food.
CNBC | China Rate Cut, More Easing, Look Imminent: Strategist
Chinese policymakers are likely to cut interest rate and reserve ratio requirements this quarter, JPMorgan’s chief Asian and emerging markets equity strategist, Adrian Mowat, told CNBC’s “Squawk on the Street” on Thursday.

Econ Comments & Analysis                                                                                            
Real Clear Markets | The Fed's 'Not Seen Since 2009' Economy
Late last week the Federal Reserve policymaking body changed the language in its monetary policy outlook. The FOMC noted in its June 20th statement that it "is prepared to take further action as appropriate".

Economist | Not your father's stagnation
Last week, obscure Tory MP Douglas Carswell tweeted, "1976 again. The orthodox approach to the economy is bust." One obvious question: is if this is the 70s, where is the inflation? Inflation, in terms of the retail price index, peaked at 26.9% in 1975. Today RPI is 2.8%. The consumer price index, the more common measure of inflation, is 2.4%.


Market Watch | Japan tax increase bill clears Diet's upper house
The Japanese government's contentious proposal to double the consumption tax rate to 10% by October 2015 was passed in the upper house of the parliament with the opposition's support, according to reports.

Econ Comments & Analysis                                                                                            
Forbes | Taxation Hero: ExxonMobil Pays $3 In Taxes For Every $1 In Profit
It’s earnings season and America’s major energy companies once again face a barrage of criticism over their profits, coupled with suggestions they don’t pay enough in taxes.

Heritage Foundation | Morning Bell: ‘Pizza Tax’ Only a Hint of Obamacare’s Costs
Papa John’s Pizza founder John Schnatter spurred new outrage over Obamacare when he said recently that the law will hike pizza prices. But his business isn’t the only one that will have to pass its new costs on to consumers—or cut back, which will mean even fewer jobs.


Pragmatic Capitalism | Is Inflation Lurking Despite High Unemployment?
After a dearth of major macro releases the last couple of days, yesterday’s economic data releases show that productivity and wages for U.S. workers increased which may bode well for future consumer spending and economic growth.

CNBC | What Obama Did Wrong on Jobs
If Barack Obama loses to Mitt Romney in November, it will almost certainly be stubbornly high unemployment during the past four years that cost the president the election.


CNBC | Clouds Gather Over Spain's Rajoy as EU Bailout Nears
Spanish Prime Minister Mariano Rajoy faces a cloudy return from his short summer break as his expected request for European aid in September will spur protests on the street and deepen cracks emerging in his conservative People's Party.

Econ Comments & Analysis                                                                                            
NY Times | How to Make Congress Do Its Job: No Budget, No Pay
Gail Collins writes, “You are probably wondering what your elected officials have been up to.” If their legislative record is any indication, not much.

Think Markets | Student Debt Bubble Side Effect
Gore Vidal died a few days ago. He was a remarkably erudite author, as any reader of his marvelous historical novels – Burr and Lincoln are just a sample – notices.  He never went to college.  Born in 1925, he joined the army at age 17 and published his first novel before age 21. Having mostly detested the high schools he was sent to, he had no desire for further schooling. But he taught himself intensively through much of his life.