Thursday, January 31, 2013

General Economics

CNN Money | Income surged in December, amid fiscal cliff fears
Income and savings surged in December but the effect is probably temporary, due mostly to Americans trying to avoid paying higher taxes in the new year.
Bloomberg | Business Activity in U.S. Grew More Than Forecast in January
Business activity in the U.S. expanded more than forecast in January, a sign manufacturing picked up at the start of the year.
CNN Money | FHA to hike premiums on mortgages
Government-insured mortgages are about to get more expensive.
Bloomberg | Consumer Comfort in U.S. Falls for Fourth Straight Week
Consumer confidence fell again last week, raising the risk that the payroll tax increase that kicked in at the start of the year will make it difficult to sustain a pickup in spending.

Econ Comments & Analysis                                                                                            
WSJ | As Contractions Go . . .
The federal government reported Wednesday that the U.S. economy shrank in the last quarter of 2012, but not to worry. The report is better than it sounds, the stock market is rocking, and in any event the Federal Reserve will take the news as another reason to keep both feet pressed firmly on the monetary accelerator.
Bloomberg | R-Word For U.S. Economy in 2013 is Rebound Not Recession
The “R” word that economists were using after yesterday’s news that U.S. gross domestic product contracted in the fourth quarter was rebound, not recession.
WSJ | America's Growing Minerals Deficit
After every election, there's a mad scramble in Washington over the must-make-it-happen agenda for the newly inaugurated president and Congress. There are welcome signs from the White House's own Material Genome Initiative that securing America's access to critical metals and minerals will be high on the list.
Forbes | President Obama's Economic Growth Is Unworthy of U.S. Tradition: What's the Matter?
Last November, the political science models that predict presidential-election winners broke. As has long been taught, no incumbent ever wins re-election after presiding over weak recovery from a steep recession and 1.5% yearly economic growth—namely President Obama’s record over his first term in office.
WSJ | If We Can't Blame Uncertainty, What Is Weighing On Growth?
Does a whole lot of uncertainty about government spending and taxes and raising the prospect that the U.S. Treasury won't have cash to pay the bills hold back an economy otherwise ready to take off?

AEI | No, the negative fourth-quarter GDP report doesn’t prove ‘austerity’ is killing the US economy
US economic output fell at a 0.1% annualized rate in the fourth quarter, adjusted for inflation. Blame spending cuts, say the Democrats. Blame Republican “austerity.” And one more thing: Stop the sequester.
CNN Money | FHA to hike premiums on mortgages
Government-insured mortgages are about to get more expensive.

Health Care

Politico | Kevin Brady to take on Medicare challenges
Congress has done little but bicker over Medicare for the past few years, but Rep. Kevin Brady still thinks he has a shot at fixing the program now that he’s leading a powerful health panel.

CATO | Goldwater Attorney: ObamaCare-Compliant Exchange Would Violate Idaho’s Health Care Freedom Act
Idaho Gov. Butch Otter (R), who added Idaho to the multi-state challenge that sought to overturn ObamaCare as unconstitutional, now supports helping the Obama administration implement the law by establishing and funding a health insurance “exchange.”


Bloomberg | Bernanke Dissatisfied With Growth Will Press on With QE Pace
Federal Reserve Chairman Ben S. Bernanke signaled he isn’t close to easing up on $85 billion in monthly bond purchases to spur a stalled economy and bring down 7.8 percent unemployment.

Econ Comments & Analysis                                                                                            
Businessweek | The Fed's Threat to the Stock Rally
By the time you read this, it may already have happened: The Standard & Poor’s 500-stock index may have passed 1,565, the October 2007 peak the market has been climbing toward since the financial crisis bottomed out in March 2009.


WSJ | U.S. Is Preparing More Tax-Evasion Cases
The U.S. is expanding its crackdown of offshore tax evasion, preparing numerous criminal cases against suspected offenders, defense lawyers involved in the cases say.
Washington Times | Virginia may start an end to gas taxes
Even though traffic often grinds to a standstill on some of its biggest highways, Virginia is suddenly attracting intense nationwide attention.
CNBC | 'Rich Tax' Puts California on Risky Path: Expert
California's governor is betting the wealthy will grow wealthier still to help right his state's finances, a wager that is expected to help the budget in the short term, but leaves it at risk of a revenue slump if assets such as stocks lose value.

Econ Comments & Analysis                                                                                            
Fortune | Cut your exposure to Medicare taxes
As Congress tackles entitlement reform, affluent retirees will be stuck with a growing tax bill. Here's how to keep it in check.

CATO | The Great Hillsdale College Debate: Flat Tax or Fair Tax?
I’m at Hillsdale College in Michigan for a conference on taxation. The event is called “The Federal Income Tax: A Centenary Consideration,” though I would have called it something like “100 Years of Misery from the IRS.”


CNN Money | Jobless claims bounce higher
Jobless claims bounced higher last week, after falling to a five-year low earlier in January.

Politico | Time Inc. 'restructuring' begins: 500 axed
Time Inc. has started its long-anticipated "restructuring" of staff and will eliminate an estimated 500 jobs today, or roughly 6 percent of its workforce.
Library of Economics | Wasteful Hiring: When Does It Cut Profits?
The boss hires his worthless unemployed nephew for a summer job.  Does that raise GDP or lower it? To keep things simple think of this as ex nihilo hiring: if not for this hire, the person wouldn't have been hired otherwise and if the boss doesn't hire the worthless nephew nobody else is going to get the job.  


National Journal | Senate to Vote on Debt Deal
The Democratic-controlled Senate is set to give final passage Thursday to a bill allowing the U.S. Treasury to keep borrowing money until May 19 and ward off the risk of default, putting off one battle as other fights loom with Republicans in upcoming weeks over automatic spending cuts and keeping the government operating.
WSJ | Treasury Posts Losses on TARP Auctions
The U.S. Treasury for the first time auctioned holdings in U.S. banks that had missed a series of dividend payments, allowing the government to close out financial-crisis era investments only at steep discounts.

Econ Comments & Analysis                                                                                            
Daily Caller | The spending sequester will grow the private economy
Today’s report of a 0.1 percent GDP decline for the fourth quarter came as a surprise to most forecasters. But it actually masks considerable strength in the private economy.
Politico | Most liberals still oppose benefit cuts
A broader look at liberal institutions and groups shows overwhelming opposition to many of the same “entitlement reforms” endorsed by these liberal and centrist think tanks featured in POLITICO.
Fortune | Fix the Debt isn't going anywhere
Even with the fiscal cliff in the rearview, Washington's CEO-backed anti-debt campaign still has the bandwith (and cash) to continue the crusade for a grand bargain on the budget.
LA Times | Kinsley: The debt debate
Wait. Stop. What are we arguing about? I hate to spoil the fun, but deficit hawks and deficit doves are actually in agreement about how this sucker should play out.

Politico | A deficit hawk's courageous stand
Type the sentence(s) summarizing the link here.