Wednesday, August 15, 2012

General Economics

Market Watch | Oil falls on inventory increase, mixed data
Crude-oil futures slipped Wednesday, giving back some of the previous session’s gains after a trade group’s report showed an unexpected rise in crude supplies and the day’s macroeconomic data were mixed.
WSJ | Rising Retail Sales Ease Fears for Economy
Americans cracked open their wallets last month, stepping up spending on everything from clothes to cars for the first time since March and easing fears that the fragile job market and weakness overseas are stalling the U.S. economy.
Market Watch | Industrial production climbs 0.6% in July
Industrial production picked up in July after two months of slight growth, the Federal Reserve said Wednesday in the latest reading that shows the economy in the third quarter got off to a decent start.
CNBC | Greece to Exit Euro Zone Next Month?
Another day, another prediction of a Greek exit from the euro zone. But unlike the vast majority who give a medium term timeline for a "Grexit", one strategist told CNBC it could come as early as next month.
CNN Money | Wells Fargo in $6.5 million SEC settlement over risk disclosure
Wells Fargo will pay $6.5 million to settle charges that it failed to disclose the risks of complex investments it sold to municipalities, non-profits and other customers, the Securities and Exchange Commission said Tuesday.
Market Watch | Foreign demand for U.S. assets softens in June
Foreign investors bought a net $5.5 billion of long-term U.S. securities in June, down from the $50.9 billion purchased in the prior month, Treasury Department data released Wednesday showed.

Econ Comments & Analysis                                                                                            
WSJ | Europe Contracts, Concerns Widen
The euro zone's $13 trillion economy is shrinking, data published Tuesday showed, a development that threatens to worsen a global slowdown and intensify the debate about Europe's attempts to restore confidence in the currency union.
CATO | Free Trade and Tobacco: Thank You for Not Smoking (Foreign) Cigarettes
As efforts to liberalize trade have moved beyond tariffs and quotas and now cover various aspects of domestic regulation and policy, some critics have argued that trade agreements undermine domestic sovereignty.
Forbes | Too Big To Fail Has Become a Permanent Bailout Program
Congressman Paul Ryan’s selection as Mitt Romney’s running mate is being described as a “game changer” that shifts the presidential election from negative tit-for-tat swipes to a higher strategic plane.
WSJ | Ryan and the Fundamental Economic Debate
The level of economic commentary during the presidential campaign has not been high. Democrats have accused Mitt Romney of the crime of shipping jobs abroad while at Bain Capital, and Mr. Romney has responded by denying the charge.
AEI | Crime scene investigation: The premeditated assault on the prime mortgage
With the Romney/Ryan ticket now in place, the debate moves to fundamental questions about the economy. The big issue which Governor Romney continues to focus on is the contrast between the government-centered society embraced by President Obama, and the Romney/Ryan vision for a society centered on freedom of choice, and free markets.
WSJ | The U.S. Natural-Gas Boom Will Transform the World
Two summers ago, natural gas cost $4.50 per thousand cubic feet, which was less than half what it had cost two summers earlier. Today the price is under $2.50, as unconventional natural gas production has increased to 20% of domestic supply from 5% in 2008, with 40% anticipated by 2020.
Mercatus | Regulation: A Primer
Federal regulations affect nearly every area of our lives and interest in them is increasing. However, many people have no idea how regulations are developed or how they have an impact on our lives. Regulation: A Primer by Susan Dudley and Jerry Brito provides an accessible overview of regulatory theory, analysis, and practice.

Library of Economics | Who Loves Bastiat and Who Loves Him Not
Thanks to everyone who responded to my query about Bastiat's "What Is Seen and What Is Not Seen."  For me, his essay is the pinnacle of economic profundity.  You can call it obvious. 
Coordination Problem | Thinking about governance from the perspective of bad movies.
In the world of Hollywood, there are only two kinds of people, good guys and bad guys. The typical action story is about a government-run diabolical cover-up of a diabolical national-security project hatched and run by diabolical government agents.
Calculated Risk | NAHB Builder Confidence increases in August, Highest since February 2007
The National Association of Home Builders (NAHB) reported the housing market index (HMI) increased 2 points in August to 37. Any number under 50 indicates that more builders view sales conditions as poor than good.
Neighborhood Effects | When Politicians Encouarge Rent Seeking
Do governments pass out privileges because firms have developed ties with political decision makers? Or do firms get close with political decision makers because they are passing out favors?
Calculated Risk | Report: Housing Inventory declines 19.3% year-over-year in July
The median age of the inventory of for sale listings was 88 days in July 2012, up slightly from June (84), but -9.27% below the median age one year ago (July 2011).
Library of Economics | Brink, Me, and Human Capitalism
Thanks to Bryan I dove into that literature and found that it does indeed offer support for the view Bryan has called "parental irrelevantism." But, as Bryan fails to acknowledge, those findings are subject to serious caveats and, in any event, there are other findings in that same literature which show an important effect of upbringing.

Health Care

Econ Comments & Analysis                                                                                            
WSJ | Why the Doctor Can't See You
Are you having trouble finding a doctor who will see you? If not, give it another year and a half. A doctor shortage is on its way.

Heritage Foundation | Family Business Sticks to Principles, Challenges Obamacare Mandate
The Obama administration’s anti-conscience mandate went into effect at the beginning of this month, and private business owners are now required to cover contraceptive care in employee health plans thanks to Obamacare.
Hoover Institute | The Obamacare Quagmire
Now that the Supreme Court has held President Obama’s Patient Protection and Affordable Care Act (ACA) constitutional, mounting evidence suggests that the statute’s most ardent defenders may well come to rue the day.


Bloomberg | EU Banking Plans Asks ECB to Share Power, Documents Show
The U.K. is pressing for the European Central Bank to share power with national regulators as it takes over euro-region bank supervision, according to policy- planning documents obtained by Bloomberg News.
Bloomberg | China Reluctance on Reserve Cut Signals Inflation Concern
China’s slower-than-forecast cuts in banks’ reserve requirements show authorities are reluctant to shake their concern inflation will quicken, three months after Premier Wen Jiabao shifted priorities to boosting growth.

Econ Comments & Analysis                                                                                            
Bloomberg | Fed’s Dudley Backs Overhaul of Money Fund Rules
William C. Dudley, president of the Federal Reserve Bank of New York, said new rules are needed to protect the financial system from a run on money-market mutual funds, lending his support to a regulatory overhaul proposed by U.S. Securities and Exchange Commission Chairman Mary Schapiro.
NBER | The Economics of Options-Implied Inflation Probability Density Functions
Recently a market in options based on CPI inflation (inflation caps and floors) has emerged in the US. This paper uses quotes on these derivatives to construct probability densities for inflation.


Econ Comments & Analysis                                                                                            
Forbes | Some Presidential Words On Federal Income Taxes
Income taxes are such a pervasive and everyday part of our financial lives—and such a central issue in presidential campaigns — that they seem to have been around forever. They have not. Their debut is relatively recent.

CS Monitor | Low taxes, smaller government, but not a balanced budget?
Our tax expert crunches the numbers of the Paul Ryan financial plan. end result? While Romney's pick for vice president is often called a deficit hawk, in fact balancing the budget is not one of his high priorities.


Econ Comments & Analysis                                                                                            
Politico | Govs engage globally for jobs locally
Governors and state legislators from Augusta, Ga., to Phoenix, Ariz., to Bismarck, N.D., and beyond have been working hard to create business tax climates in their states that can compete in the global economy. Their task has been complicated because state officials must combat the headwinds of a White House whose federal policies make states less competitive compared to foreign competitors.

Heritage Foundation | Rural Utilities Create Zero Jobs Despite $47 Million in Stimulus Funding
A stimulus program designed to create jobs by funding rural utility projects has created only about 12% of the jobs projected at the outset of the program in a sample of towns recently examined by the Agriculture Department’s Inspector General.


Econ Comments & Analysis                                                                                            
Investors | Obama's $25 Billion Government Motors Lemon
As the Obama campaign continues to tout the GM bailout as an industrial policy success, the Treasury Department continues to revise upward the staggering losses inflicted on U.S. taxpayers.

Economist | Defying gravity
One of this week's new NBER working papers is a fascinating look at Japanese government debt, by Takeo Hoshi and Takatoshi Ito.