Tuesday, September 11, 2012

General Economics

Market Watch | U.S. trade gap stays near 18-month low in July
The U.S. trade deficit widened 0.2% in July to $42.0 billion, just marginally above the 18-month low set June, the Commerce Department said Tuesday.
Bloomberg | Wen Signals China Has Ample Policy Room to Meet Growth Goal
Chinese Premier Wen Jiabao said the nation has full confidence it will meet its economic goals for the year and signaled there’s more room for fiscal and monetary policy to support growth.
Bloomberg | Big Banks Hide Risk Transforming Collateral for Traders
JPMorgan Chase & Co. (JPM) and Bank of America Corp. are helping clients find an extra $2.6 trillion to back derivatives trades amid signs that a shortage of quality collateral will erode efforts to safeguard the financial system.
Market Watch | Consumer credit drops for first time in 11 months
Consumer credit declined in July for the first time in 11 months as Americans turned to their plastic less and as growth in student loans cooled, according to data released Monday.
Market Watch | Small-business index climbs in August, NFIB says
Small-business optimism rose in August as owners become more optimistic on the economy and future sales and increased their plans to hire, according to an index released Tuesday.

Econ Comments & Analysis                                                                                            
Washington Times | Rebuilding U.S. global leadership
Today, the names of those who were lost on Sept. 11, 2001, will be read aloud at memorials in Shanksville, Pa., Washington, D.C., and New York City — 11 years after a morning that introduced many Americans to terrorism and a brutal group known as al Qaeda.

AEI | Manufacturing profits are 35% above pre-recession levels
U.S. manufacturers had another solid quarter of profits from April to June, according to data released today by the Census Bureau.

Health Care

National Journal | Mixed Message From Obama Advisers on Medicare
President Obama has seized on Republican proposals to overhaul Medicare as a top campaign issue, saying that the GOP plan to add a private insurance option would end seniors’ guarantee of government health care. But behind the election-season politics, influential experts who have advised Obama on health care are open to a future for Medicare that includes competition among private insurance plans.

Econ Comments & Analysis                                                                                            
National Journal | Medicare Views Raise Warning Signs for Both Parties
With less than two months to go before Election Day, Americans are expressing concern about the viability of the Medicare system, a leading Republican plan to reform it, and whether President Obama’s health care plan will help them. This dour tableau affecting both parties is laid out in the latest edition of the United Technologies/National Journal Congressional Connection Poll.


Econ Comments & Analysis                                                                                            
CNBC | More Fed Easing Won’t Push Banks to Lend: Bair
Additional easing from the Federal Reserve won’t result in more bank lending, Sheila Bair, the former chair of the Federal Deposit Insurance Corp., told CNBC’s “Squawk Box” on Monday.
FOX Business | Obama Chose Monetary Policy - And You're Feeling It
There is no hiding from the facts. His tactic didn't work, and there are no signs that it will. In fact, buried in the most recent economic report out on Friday was a statistic that most people missed but is very troubling: recent M3 data prove that the money supply is growing at a very rapid rate, and this is a leading indicator of inflation. 

Daily Capitalist | As The Euro Tumbles, Spaniards Look To Gold
The unremitting deterioration of the eurozone’s sovereign debt landscape continues to fuel uncertainties about the longevity of the euro as a hard currency.


Tax Foundation | Missouri to Look More Closely at Ineffective Tax Credits
Missouri Governor Jay Nixon (D) has asked the state’s Tax Credit Review Commission to meet on September 12 after news broke of a 15 percent increase in state tax credit claims by taxpayers.
National Review | Will France Go Down in Flames?
Last night, the president of France, Francois Hollande, spoke to the French people (9 million of them tuned in) and announced an unprecedented effort to close the deficit by raising an additional €20 billion in taxes next year. With the French economy projected to grow 0.8 percent next year, it’s hard to imagine that this increase in taxes is a good idea.


CNN Money | Why wages aren't rising
When the government report on job creation came out last week, economists were quick to note a worrying point: average hourly wages in August dropped by a penny.
Bloomberg | Bernanke Proves Like No Other Fed Chairman on Joblessness
When it comes to achieving his mandate for full employment, Ben S. Bernanke’s willingness to undertake more bond buying shows yet again that he’s the most aggressive and experimental Federal Reserve chairman in history.

Econ Comments & Analysis                                                                                            
WSJ | Incubating Ideas in the U.S., Hatching Them Elsewhere
The United States—unlike Chile, Britain, Singapore, New Zealand and other countries—does not have a visa category for immigrants who aspire to found companies and create jobs. That means we are turning away potential job creators
NBER | Mismatch Unemployment
We develop a framework where mismatch between vacancies and job seekers across sectors translates into higher unemployment by lowering the aggregate job-finding rate.

Marginal Revolution | Have job openings become less potent?
In the post-recession environment, the employment-population ratio is no longer responsive to increases in job openings. This is a severe structural shift driven by a spike in the length of unemployment
AEI | Has government employment really increased under Obama?
On “This Week with George Stephanopolous” yesterday, Senator Rand Paul and Professor Paul Krugman got into a quick argument about the size of government under President Obama.
WSJ | Many New Jobs Created in Low-Wage Industries
Since bottoming out in February 2010, the U.S. economy has added about 4.6 million private-sector jobs. That’s the good news. The bad news is that it’s not nearly enough to make up for the 8.9 million wiped out during the recession. And many of the new jobs are in industries that have less-than-stellar wages.
AEI | Sorry, Democrats: College students returning to school doesn’t explain the drop in the labor force
Watching the Sunday news shows yesterday, a Democratic talking point became clear: That the huge drop in the labor force in last week’s jobs report was due in large part to young people leaving the workforce to return to school. This would be shocking if it were true. Here’s why.


Market Watch | Moody's: Budget talks key to U.S. rating outlook
Analysts at Moody's Investors Service would like to see some constructive action taken by the White House and Capitol Hill on the federal debt, saying in a report Tuesday that this would be a key factor in determining whether the agency will change its ratings outlook for U.S. government debt.
National Journal | Six-Month CR Could Avert Lame-Duck Spending Fight
Republicans are seeking quick passage of a stopgap measure to fund the government for six months beyond the end of the fiscal year on Sept. 30. Conservatives this summer agreed to an $8 billion spending increase in the bill to avoid complicating the upcoming lame-duck session with a squabble over short-term spending.

Neighborhood Effects | Central Falls bankruptcy exit plan approved
In what is described as, “the quickest bankruptcy adjustment in U.S. history,” Central Falls, Rhode Island has reached an agreement to exit from bankruptcy with a plan that will fully repay bondholders (including any legal fees incurred), while slashing worker pensions by as much as 55 percent.
WSJ | Consumer Debt Declines, Even as Student Loans Grow
Consumer credit declined from June by a seasonally adjusted $3.28 billion to $2.705 trillion, a Federal Reserve report showed Monday. Consumer credit declined at a 1.45% annualized rate during July, its first contraction since a 3.95% decline in August 2011.