Thursday, June 19, 2014

General Economics

Market Watch | China premier vows no hard landing for economy
Chinese Premier Li Keqiang vowed that his nation's economy will not suffer a so-called "hard landing," according to comments carried by the state-run Xinhua News Agency.
Market Watch | U.S. leading economic index rises 0.5% in May
Signaling that economic growth could pick up in coming months, the leading economic index for the U.S. rose 0.5% in May to 101.7, the Conference Board said Thursday.
Daily Signal | Economic Crisis Survival: Germany Shows That Preparation Is Key
Germany is one example. Reunification meant great opportunity for Germany, but it also meant a prolonged period of economic weakness. The fiscal and structural reforms lawmakers made in response continue to pay dividends to this day.

Econ Comments & Analysis                                                                                            
National Review | An Increasingly Expensive Chicken in Every Pot
The idea of economic tradeoffs is strangely difficult to grasp for policymakers and the public alike. Rising home prices are frequently treated as though they were an unmitigated good, which they are — if you already own a home. If you’re looking to buy a home, rising home prices are an expense. But homeowners — older, wealthier, more likely to vote — are politically more powerful than prospective buyers, who are generally younger, less wealthy, and less likely to vote.
WSJ | Immigration Reform Can't Wait
When I learned that House Majority Leader Eric Cantor had lost his Republican primary, my heart sank. Not simply because I think he is an intelligent and talented member of Congress, or because I worry about the future of the Republican Party.
WSJ | Why the U.S. Needs to Lift the Ban on Oil Exports
The U.S. has, with minor exceptions, banned the export of crude oil since the early 1970s. For most of the following decades this did not matter, as U.S. appetite for imported oil seemed insatiable. But it matters now, and it will matter more in the years ahead. While it may seem paradoxical, exporting U.S. crude will increase, not reduce, domestic oil supplies and lower, not raise, domestic gasoline prices.
Real Clear Markets | What Is the Federal Government Hiding About Fannie Mae and Freddie Mac?
At present the United States is embroiled in litigation with Fairholme Funds over the so-called Third Amendment to the Senior Preferred Stock Purchase Agreement (SPSPA) that it entered into on August 17, 2012.
Heritage Foundation | Why Is Federal Housing Policy Fixated on 30-Year Fixed-Rate Mortgages?
Robust mortgage financing exists in virtually every developed nation in the world without the degree of government involvement found in the U.S. While the U.S. homeownership rate is about average among developed nations, U.S. citizens typically pay among the highest interest rates in the industrialized world. Still, many groups argue that eliminating the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac would imperil mortgage financing in the U.S.

WSJ | Four Rules of Thumb to Gauge How Oil Prices Hit the Economy
A story in today’s Journal shows the U.S. may be more insulated from the hazards of the international oil market than in the past. But rising oil prices still have ripple effects on the U.S. economy. Here are some handy rules of thumb we worked out with Deutsche Bank chief U.S. economist Joseph LaVorgna to monitor how this could play out.
CBO | CBO's Projections of GDP Per Capita
After CBO participates in Congressional hearings, the Members of the Committees before which we have testified often send us questions that they did not have time to ask during the hearings themselves. Our answers to such “questions for the record” are ultimately included in the reported proceedings for those hearings.
CATO | Debunking the Induced-Demand Myth
“Building bigger roads actually makes traffic worse,” asserts Wired magazine. “The reason you’re stuck in traffic isn’t all these jerks around you who don’t know how to drive,” says writer Adam Mann; “it’s just the road that you’re all driving on.” If only we had fewer roads, he implies, we would have less congestion.
NY Times | Detroit Rolls Out New Model: A Hybrid Pension Plan
In the face of Detroit’s tumultuous bankruptcy proceedings, in which multiple parties are quarreling to protect their interests, the city and its unions have quietly negotiated a scaled-back pension plan that could serve as a model for other troubled governments.

Health Care

FOX Business | Overhauling Health Exchanges: A Pricey, Complex Maneuver
With five months to go until the Affordable Care Act’s 2015 open enrollment season, states that had troubled exchanges during the inaugural sign-up period are scrambling to either upgrade their sites or transition to the federal exchange—all on the taxpayer’s dime.
Daily Signal | Obamacare’s Risk-Management Programs Could Cost Billions, Experts Tell House
Obama administration officials insisted that Obamacare’s risk-management programs are temporary and budget neutral, but others at a hearing of the House Committee on Oversight and Government Reform today argued the programs will be a boondoggle for taxpayers.

Econ Comments & Analysis                                                                                            
WSJ | Premiums Rise at Big Insurers, Fall at Small Rivals Under Health Law
Hundreds of thousands of consumers nationwide who bought insurance plans under the Affordable Care Act will face a choice this fall: swallow higher premiums to stay in their plan, or save money by switching.

CBO | Estimating the Budgetary Effects of the Affordable Care Act
In March 2010, just before the Affordable Care Act (ACA) was enacted, CBO and the staff of the Joint Committee on Taxation (JCT) estimated that changes in direct spending and revenues under the legislation would reduce federal budget deficits by $124 billion over the 2010–2019 period and by roughly one-half of 1 percent of gross domestic product (GDP) over the ensuing decade.


Bloomberg | Fed Dots Ignored as Investors Focus on Yellen’s Message
Investors trying to anticipate Federal Reserve interest-rate policy are ignoring the dots and focusing on Chair Janet Yellen’s words.
Bloomberg | Abenomics Fails to Shake Japan Firms’ Addiction to Cash
Japanese firms boosted their cash stockpile to a record in the first quarter, underlining challenges Prime Minister Shinzo Abe faces a year and a half into his drive to reflate the economy.

Econ Comments & Analysis                                                                                            
WSJ | Downgrading Growth Again
The Federal Reserve's Open Market Committee on Wednesday stuck to its path of reducing its bond purchases by $10 billion a month, which was no surprise. The news, by now so routine that perhaps it also shouldn't surprise, is that the Fed once again reduced its forecast for economic growth.
Foreign Affairs | Taper Trouble
In April 2013, Ukraine was sporting a massive current account deficit of eight percent, and it badly needed dollars to pay for vital imports. Yet on April 10, President Viktor Yanukovych’s government rejected terms set by the International Monetary Fund (IMF) for a $15 billion financial assistance package, choosing instead to continue financing the gap between its domestic production and its much higher consumption by borrowing dollars privately from abroad. So a week later, Kiev issued a ten-year, $1.25 billion eurobond, which cash-flush foreign investors gobbled up at a 7.5 percent yield.

WSJ | 5 Takeaways From Fed Decision, Yellen News Conference
The Federal Reserve sharply reduced its outlook for economic growth this year but became seemingly more convinced of the need for interest-rate increases. Janet Yellen, in her second news conference as Fed Chairwoman, said she was optimistic about growth, but emphasized the uncertainty in the Fed’s rosy forecasts for 2015 and beyond.


Econ Comments & Analysis                                                                                            
Politico | Corker, Murphy tee up bipartisan proposal to increase gas tax
Corker, a Tennessee Republican, and Murphy, a Connecticut Democrat, pitched a bold plan that calls for federal gasoline and diesel tax increases to shore up the Highway Trust Fund, which pays for most federal transportation programs mostly through a tax on gasoline.
WSJ | IRS Eases Up on Accidental Tax Cheats
The Internal Revenue Service is sharply increasing the penalties on U.S. taxpayers who hide assets abroad, while lowering or eliminating fines on taxpayers if their failure to disclose offshore accounts was unintentional, the agency said Wednesday.


Bloomberg | Jobless Claims in U.S. Fell Last Week as Labor Market Heals
Jobless claims fell 6,000 to 312,000 in the week ended June 14, the Labor Department reported today in Washington. The median forecast of 50 economists surveyed by Bloomberg called for 313,000. The total number of people collecting benefits decreased to the lowest level in almost seven years.

Econ Comments & Analysis                                                                                            
National Journal | Making a Move to Counter Unemployment and Boost Social Mobility
The solution to two of the country's most pressing economic woes may come down to a very simple idea: renting a bunch of moving vans. Those vans could help relocate some of the more than 3 million Americans who have been out of work for more than six months to states with relatively low unemployment rates, such as Texas and North Dakota. Or the vans could transport entire families to places where low-income kids historically have a better chance of moving up the income ladder as they age.

WSJ | U.S. Workers Can’t Get No (Job) Satisfaction
In almost every individual measure—from wages and retirement plans to vacation policies and commutes—workers are less content with their jobs than they were in 1987, when the research group started tracking the topic. Back then, 61.1% of workers said they were satisfied with their work.


FOX Business | Retirement Savings Rebound: The New Norm, or a Blip?
A recent study from Principal Financial Group finds an increase in 401(k) savings and contribution rates since 2009. The study, which analyzed more than 1.8 million 401(k) participants, found  balances rose 93% -- nearly double -- since the downturn.