Tuesday, October 23, 2012

General Economics

WSJ | U.K. Businesses Wary of Spending
Economic uncertainty continues to limit U.K. business investment plans, with the latest figures published Tuesday reporting a fourth consecutive net repayment by nonfinancial firms to British high street banks.
Washington Times | Caterpillar: Economy weaker than expected
Caterpillar says the world’s economy is weaker than it thought, and it doesn’t expect growth to pick up until the second half of next year.
Bloomberg | World Bank Lauds Developing Nations’ Competitiveness Push
Singapore ranked at the top of the World Bank’s annual competitiveness study for a seventh straight year, while developing nations were found to be accelerating reforms making it easier to open and operate businesses.
CNN Money | Gas price slide could brighten Thanksgiving
Americans thinking about driving over the river and through the woods for Thanksgiving could be in line for a nice surprise: lower gas prices.
Market Watch | CFTC's Gensler: Derivatives transparency by 2013
The public will benefit from real-time reporting for the $650 trillion global derivatives market by year-end, the nation's commodity futures regulator said Tuesday.
Bloomberg | DeMarco Shrinks Fannie-Freddie Without Help From Congress
The man with power over more than half of U.S. mortgages lives in a 1961 brick split-level house. There’s a basketball hoop in the driveway and a green Subaru Outback in the carport. The homes on Edward J. DeMarco’s block are so close that neighbors see into each other’s windows.

Econ Comments & Analysis                                                                                            
WSJ | The Real Stimulus: Low-Cost Natural Gas
An unconventional oil and gas revolution is under way in the United States, but its full ramifications are only beginning to be understood. The basic facts are clear enough. Half a decade ago, it was assumed that the U.S. would become a large importer of liquefied natural gas; now the domestic natural gas market is oversupplied, thanks to the ability to produce shale gas through hydraulic fracturing and horizontal drilling technologies.
Real Clear Markets | Obama Envisions An Energy Future Through Pink Shades
In Monday's third foreign policy debate President Obama promised to develop the energy sources of the future.
WSJ | Banking Union or Bailout Union?
European policy makers are trumpeting the progress they made at last week's summit: The EU will agree "over the course of 2013" on how its banking union will work. But the more interesting action took place on the summit's sidelines.

Daily Capitalist | Fraud: Why The Great Recession
Free markets are not to be blamed for the Great Recession. On the contrary, its origins rest upon the deep government and central bank intervention in the economy. Through fraudulent mechanisms, this causes recurrent boom and bust cycles: bad policies create phases of irrational exuberance, which are then followed by economic recessions, a result that every citizen ends up suffering from.
John Cochrane | Are recoveries always slow after financial crises and why
Carmen Reinhart and Ken Rogoff have an interesting new Bloomberg column, "Sorry, U.S. recoveries really aren't different." They point to the great Barry Eichengreen and Kevin O'Rourke "Tale of two depressions: what do the new data tell us" columns.
AEI | Disagreeing with Christina Romer on the value of the Obama stimulus
Former Obama White House economic adviser Christina Romer gives it her best effort in defending the efficacy of the 2009 American Recovery and Reinvestment Act. In a New York Times op-ed yesterday, Romer says the stimulus package wasn’t “the knockout punch the administration had hoped for, but a valuable effort that improved the lives of many.”

Health Care

Econ Comments & Analysis                                                                                            
John Cochrane | After the ACA: Freeing the market for health care
Most of the current policy debate, and the optimistically‐named “Affordable Care Act,” focuses on health insurance. I think we need to move on to think about the economics of health care. If the ACA is repealed, we still have a mess on our hands, and just fixing insurance will not be enough to clean up that mess.

Neighborhood Effects | If Obamacare is Repealed, Maybe We Should Replace it With George McGovern’s Plan?
The editorial board in today’s Wall Street Journal eulogizes George McGovern. At the end, they point to a 1992 OpEd that McGovern wrote for the journal. It talks about the regulatory burdens he encountered after he gave up the trappings of public office to become an inn-keeper


Market Watch | Fed considers upping QE3 size and language
After historic changes last month, Federal Reserve officials this week will discuss a possible expansion of the size of its third round of bond buying and better ways to guide markets about future policy actions.

Econ Comments & Analysis                                                                                            
Bloomberg | A Few Fed Numbers Worth a Thousand Words
Modern central banks have been described as “an army with only a signal corps.” It’s an apt portrayal.


CNBC | End to Payroll Tax Holiday May Weigh on Economy
A tax break that’s added about $19 a week to many paychecks for the last two years looks like it’s going away in January. While most taxpayers may not notice the difference, it’s a good bet the economy will.

Econ Comments & Analysis                                                                                            
WSJ | The Obama Storm Tax
Behold the Obama Administration's new public works plan. Sue cities for polluting waterways and then as part of a settlement require them to spend, er, "invest" billions in extraneous sewer improvements. The White House doesn't even need legislation to pour this money down the drain.

AEI | Yes, low capital gains taxes help growth. And this chart shows why
Again we see a remarkably strong association between the capital gains tax and Venture Capital Investments. Following tax cuts in the late 1970s Venture Capital fund-raising explodes. The tax increase a decade later is followed by a decline in committed fund. Investments again increased when Clinton cuts the capital gains tax in the late 1990s.


CNN Money | DuPont to cut 1,500 jobs
Chemical company DuPont announced Tuesday it would cut about 1,500 jobs worldwide, or about 2% of its global work force.


Econ Comments & Analysis                                                                                            
Roll Call | Unfortunately, the Fiscal Cliff Joke Is on Us
Have you heard the one about the big-name financial services CEOs who last week released a letter to Congress and the president demanding they do whatever it takes to avoid the fiscal cliff?

Marginal Revolution | Questions that are rarely asked
Japan is about to replace China as America’s biggest creditor. Could you please offer us some meaningless bluster about “getting tough with Tokyo?”
Calculated Risk | Bank of Spain: Recession Continues, Deficit to Increase
Spain's central bank said Tuesday the country's economy contracted slightly less than expected in the third quarter but repeated a warning that tax-revenue shortfalls could cause the government to miss its 2012 budget-deficit target.