Thursday, January 10, 2013

General Economics

News                                                                                                                             
CNN Money | New rules aim to make mortgages safer
Federal officials unveiled new mortgage rules on Thursday meant to reduce risky lending and make it easier for borrowers to know exactly what they are getting into.
Market Watch | What’s ahead for Social Security in 2013
If there’s any good news for retirees and near-retirees in the coming debate over government spending and the U.S. debt ceiling, it’s that lawmakers may bypass changes to the Social Security program.
Bloomberg | Consumer Comfort Drops as Americans Brace for Payroll Tax Boost
Consumer confidence in the U.S. slumped last week to the lowest level in a month as Americans prepared to lose a portion of their pay to taxes.

Econ Comments & Analysis                                                                                            
Washington Times | $1 trillion in gimmicks
Politicians love nothing more than telling people what to do. Hearts warm in the Capitol any time a new bill is dropped in the hopper prohibiting something or expending taxpayer funds in service of the latest trendy cause.
WSJ | In the Index of Economic Freedom, Liberalization Slips
The foundations of economic freedom are weakening around the world, according to the 2013 Index of Economic Freedom, published today by the Heritage Foundation and The Wall Street Journal. Particularly concerning are the rise of populist "democratic" movements that use the coercive power of government to redistribute income and control economic activity.

Blogs                                                                                                                             
CBO | How Will Older People’s Participation in the Labor Force Be Affected by the Coming Increase in the Full Retirement Age for Social Security?
CBO expects that the share of older people who work will increase in the latter part of this decade in response to the scheduled increase in the full retirement age (FRA) for Social Security.
Heritage Foundation | Morning Bell: See America’s Ranking in the 2013 Index of Economic Freedom
Today launches the 19th edition of the Index of Economic Freedom, produced by The Heritage Foundation and The Wall Street Journal.

Health Care

News                                                                                                                             
Politico | States struggle with how to sell their exchanges
From Pandora radio to those paper coffee cup sleeves to the neighborhood laundromat, states are searching for creative ways to advertise their new health insurance exchanges to people who may not know much about how to get covered next year under the health care law — and who may not like what they’ve heard.
WSJ | Americans Die Younger Than Peers
Americans die younger and have more illnesses and accidents on average than people in other high-income countries—even wealthier, insured, college-educated Americans, a report said Wednesday.

Econ Comments & Analysis                                                                                            
CNBC | US Could Save $2 Trillion on Health Costs: Study
The U.S. could save $2 trillion in health-care spending over the next decade, if the U.S. government used its influence in the public and private sectors to nudge soaring costs into line with economic growth, a study released on Thursday said.

Monetary

News                                                                                                                             
Bloomberg | ECB Maintains Benchmark Rate at 0.75% as Economic Mood Brightens
The European Central Bank kept interest rates on hold as improving economic sentiment underpinned expectations of a gradual recovery this year.
CNBC | The Fed Guessing Game: Funds Rate to Rise, but When?
The most important part of the Federal Reserve-watching game is now this: figuring out how long it will take for the unemployment rate to drop to 6.5 percent. That's the benchmark that the Fed's rate-setting Open Market Committee pegged in December as the one that will prompt it to begin raising the Fed funds rate, now set between 0 and a quarter of a percentage point.

Econ Comments & Analysis                                                                                            
WSJ | Deficits, Debt and the Fate of the Dollar
The year-end "fiscal cliff" tax deal sent shivers through the bond market, driving the price of 10-year Treasurys to the lowest level since April. There was a good reason. The stubborn resistance by President Barack Obama and Senate Majority Leader Harry Reid to spending cuts left no further doubts about their lack of interest in the nation's No. 1 economic problem, massive federal deficits.
NBER | Product Introductions, Currency Unions, and the Real Exchange Rate
We use a novel dataset of online prices of identical goods sold by four large global retailers in dozens of countries to study good-level real exchange rates and their aggregate implications.

Blogs                                                                                                                             
WSJ | Vital Signs Chart: Dollar Gaining Ground
The dollar is gaining ground against the world’s currencies. The WSJ Dollar Index, which measures the dollar against the world’s most heavily traded currencies, edged higher to 71.042, the second-highest reading since August.

Taxes

News                                                                                                                             
CNN Money | Middle class tax breaks on the line
President Obama wants to tie spending cuts to tax revenue hikes in the debt ceiling talks, but that could mean trouble for the middle class taxpayers he has pledged to protect.

Econ Comments & Analysis                                                                                            
NY Times | I.R.S.’s Taxpayer Advocate Calls for a Tax Code Overhaul
Lawmakers need to overhaul the tax code completely to reduce the “significant, even unconscionable, burden” placed on taxpayers just to file a tax return, the Internal Revenue Service’s ombudsman told Congress on Wednesday.
AEI | The myth of the limits on itemized deductions
As the fiscal cliff deal began to take shape at the end of December, media reports stated that the agreement would cap itemized deductions. In the days since the agreement was signed into law, some articles have continued to claim that it limits itemized deductions, including the charitable deduction, and therefore discourages charitable giving. But, it’s all a myth. For better or worse, the new law doesn’t actually cap any itemized deductions.

Blogs                                                                                                                             
CATO | End Gas Tax? Yes! Pay for Roads with Sales Tax? No!
Virginia Governor Bob McDonnell wants his state to be the first to end the gas tax. This is a good idea because gas taxes are an imperfect user fee.

Employment

News                                                                                                                             
CNN Money | Not a great start for jobless claims in 2013
Happy New Year! The American economy kicked off 2013 with a small rise in new claims for unemployment benefits -- a closely-watched indicator of the health of the job market
Bloomberg | Companies Keep People to Be Fired With State Work Share
Some states are adding a new twist to the old concept of unemployment insurance: Paying to keep Americans in their jobs rather than giving them cash when they lose them.

Econ Comments & Analysis                                                                                            
Washington Times | Higher wages, lower employment
New York Gov. Andrew Cuomo on Wednesday laid out a wide-ranging agenda for the year. The first-term Democrat wants gun control, casinos and higher pay for teachers. Perhaps his most economically perilous proposal is an insistence on raising the state’s minimum wage from $7.25 an hour to $8.75.

Blogs                                                                                                                             
Calculated Risk | BLS: Job Openings "unchanged" in November
The number of quits (not seasonally adjusted) was little changed over the 12 months ending in November for total nonfarm and total private.
Library of Economics | Feeling vs. the Minimum Wage
If you're trying to sell libertarianism to Feeling people, "hard head, soft heart" ideas are more persuasive than "hard head, hard heart" ideas.  But the libertarian remains at an inherent disadvantage against intellectual rivals pedaling "soft head, soft heart" ideas.
Calculated Risk | Question #3 for 2013: How many payroll jobs will be added in 2013?
Some years I make some big calls. Not this year. Although I think parts of the economy are poised for more growth, I think austerity at the Federal level means another year of sluggish growth.

Budget

News                                                                                                                             
National Journal | The Latest Debt-Ceiling Proposal: Issue IOU's
The $1 trillion platinum coin seems too wacky; the 14th amendment too risky. But could IOU's be the solution to an impasse on raising the nation's borrowing limit?
Bloomberg | Obama’s Default Drama Is No Way to Run a Country
The United States of America isn’t going to default on its debt, even if Congress doesn’t increase the statutory borrowing authority in the next couple of months. Everyone in Washington knows, or should know, this. Any assertions to the contrary are tantamount to -- perish the thought! -- playing politics with the debt ceiling.
CNN Money | Debt ceiling FAQs: What you need to know
Congress narrowly avoided pushing the country off the fiscal cliff. But it has done nothing to address the next and potentially bigger risk to the economy: the need to raise the debt ceiling.

Econ Comments & Analysis                                                                                            
WSJ | A GOP Strategy for the Debt-Ceiling Fight
President Obama says he won't negotiate with Republicans over his proposed more than $1 trillion increase in the debt ceiling as a matter of principle because Congress "should pay the bills that they have already racked up."
Washington Post | Time for a balanced-budget amendment
Democrats not allergic to arithmetic must know the cost of their “fiscal cliff” victory. When they flinched from allowing all of George W. Bush’s tax rates, especially those on middle-class incomes, to expire, liberalism lost its nerve and began what will be a long slide into ludicrousness.
CNBC | Why Banks Are Rushing to Sell US Debt
Banks and financial institutions are leading the pack of global borrowers that have rushed to the U.S. debt markets at the start of the year.
CATO | The Fiscal Facts of Life
Having completed yet another deficit-reduction agreement that somehow managed to increase the deficit, Congress and the Obama administration are now laying the groundwork for upcoming fights over the debt ceiling, the sequester, and the continuing resolution that will fund the government given continued refusal by Senate Democrats to pass a budget.

Blogs                                                                                                                             
Washington Post | The debt-ceiling drama in 5 charts
Fasten your seat belts, folks. The “extraordinary measures” the Treasury Department is using to keep the United States from crashing through its $16.4 trillion debt ceiling could run out as early as Feb. 15.