Wednesday, July 2, 2014

General Economics

WSJ | U.S. June Auto Sales Keep Climbing
Low interest rates and a brighter economic outlook drove U.S. new-vehicle sales higher for most major auto makers in June, allaying worries of a market slowdown and setting the industry up for a strong second half.

Econ Comments & Analysis                                                                                            
FOX News | Washington's bad policies stunt job growth
Thursday, the Labor Department is expected to report the economy added 211,000 jobs in May. In line with the pace so far this year, that is far short of what is needed to keep up with population growth and genuinely reduce unemployment.
Investors | Correcting The President: The Free Market Works
A couple of years ago, President Obama, speaking on the economy, told an audience in Kansas: "The market will take care of everything, they tell us. ... But here's the problem: It doesn't work. It has never worked. ... I mean, understand, it's not as if we haven't tried this theory."
WSJ | 'Mixed-Income' Housing Won't Spur Upward Mobility
New York Mayor Bill de Blasio has made the production of "affordable housing"—the political term for subsidized construction or rentals—a centerpiece of his progressive mayoralty. His goal is much more ambitious than additional housing for families with low and moderate incomes. Instead his priority is to ensure that people in different income groups live in the same neighborhoods, using zoning in particular. "Economic diversity," states the city's plan to build or preserve 200,000 affordable units, "must be a cornerstone of housing development."
Real Clear Markets | We're Stuck With Fannie & Freddie, So Let's Neuter Them
The model of Fannie Mae and Freddie Mac as "GSEs" (government-sponsored enterprises) was a profound mistake. Virtually everybody agrees with that. In retrospect, it was also an obvious mistake. Just imagine anybody wanting to hyper-leverage half the mortgage market on the taxpayers' credit card, so the profits were private and the losses public, create an enormous credit risk concentration in Washington DC, and inevitably curry political favor by increasing risk.
CATO | Tenure Isn’t the Problem, Government Is
Tenure takes a lot of abuse from a lot of well-intentioned people. Ensconced in a top-down education system in which kids and dollars primarily flow to schools based on home addresses, tenure is a considerable inefficiency. But tenure itself is not the problem; the system is.

WSJ | GDP is Down, But What Do Payrolls Say About A New Recession Risk?
U.S. gross domestic product shrank by 2.9% in the first quarter of 2014, by far the worst quarter since the recovery began in mid-2009. But GDP is only one indicator to monitor if the U.S. is slipping into renewed recession. So far the monthly jobs report is one of the key pieces of evidence that the expansion will continue.
WSJ | Fed Research Paper: Rise in Partisan Conflict is a Drag on the U.S. Economy
Partisan political bickering is driving up government budget deficits and holding down job creation, business investment and overall U.S. economic growth, according to new research from the Federal Reserve Bank of Philadelphia.

Health Care

CNN Money | Were Obamacare applications accurate? Who knows?
The main issues: Exchanges weren't able to confirm many applicants' citizenship status and income, according to a report by the Inspector General of the Department of Health & Human Services.
Bloomberg | Slow Growth of U.S.Health Spending Mirrors Other Nations
The growth of health-care spending in the U.S. has slowed during the past decade to a rate more similar to other developed countries, a study found.

Econ Comments & Analysis                                                                                            
Politico | Big cyber hack of health records is 'only a matter of time'
The health world is flirting with disaster, say the experts who monitor crime in cyberspace. A hack that exposes the medical and financial records of tens of thousands of patients is coming, they say — it’s only a matter of when.
CATO | Congress Wants to Double Down on VA Failures
Bipartisanship has broken out in Washington. This isn’t usually a good sign. Faced with the ongoing scandal in the VA health-care system, Democrats and Republicans have joined together to rush through legislation in near-record time.


Econ Comments & Analysis                                                                                            
Market Watch | Five surprises that could derail higher interest rates
Even if they put up giant signs on the side of the road, the central banks of the U.K. and the U.S. could hardly make their intentions any clearer. At some point in the next six to nine months, interest rates are going to start rising.
Real Clear Markets | Dodd-Frank Is Not Living Up To Its Promises
This month marks four years since the passage of Dodd-Frank. Slightly more than half of the Dodd-Frank rules are final, according to law firm Davis Polk. This rulemaking pace is not as rapid as many would like. But enough regulations are in place to indicate that Dodd-Frank is not living up to the promises embedded in its official title, "The Wall Street Reform and Consumer Protection Act." Meaningful Wall Street reform and consumer protection requires more creative thinking than Dodd-Frank's tried and tired approach to financial regulation.
NBER | Effects of Unconventional Monetary Policy on Financial Institutions
Monetary policy affects the real economy in part through its effects on financial institutions. High frequency event studies show the introduction of unconventional monetary policy in the winter of 2008-09 had a strong, beneficial impact on banks and especially on life insurance companies.
AEI | A reality check for the Federal Reserve
One has to applaud the Bank for International Settlements (BIS), the Basel, Switzerland-based bank for the world's central banks, for providing the Federal Reserve with a reality check as to the state of U.S. and global financial markets. More important still, one has to salute the BIS for not pulling punches in reminding the Fed as to the potentially high cost of an overly easy monetary policy, especially if it is maintained for too long.
Heritage Foundation | The Centennial Monetary Commission Act of 2013: A Second Look at the Fed and the 2008 Financial Crisis
There is still a great deal of debate over the Federal Reserve’s role in the 2008 financial crisis. Critics have blamed the Fed’s policies for everything from causing the crisis to worsening it, as well as prolonging the economic recovery after the financial markets stabilized. This debate has not been settled, but Congress has already expanded the Fed’s authority, providing yet another avenue for criticism.

Market Watch | Yellen to address financial stability as concerns grow about impact from Fed policy
Federal Reserve Chairwoman Janet Yellen is set to discuss financial stability on Wednesday as observers worry that the Fed’s exit from its easy monetary policy stance will roil markets.
WSJ | Global Central Banking in 2014, A Second Quarter Update for 24 Economies
Five years after the global recession of 2009, economic growth remains troublingly weak and inflation uncomfortably low in many developed economies. Several emerging-market economies are expanding more slowly than in the past while inflation remains high. And housing prices appear frothy in some countries. Many of the world’s central banks held policy steady in the second quarter, but some made moves or indicated they are preparing to act in the months ahead.


CNN Money | This job has the world's worst tax return
As they crisscross the globe, IRS rules require expat American pilots to record exactly how long they're flying over the U.S., foreign countries and international waters. Once they land, the pilots have to track exactly when they're working, and when they're off the clock.
Washington Times | Berkeley City Council sends soda tax to voters
The Berkeley City Council voted Tuesday night to put a measure on the ballot that would impose a penny-per-ounce tax on soda and other sugar-sweetened beverages such as energy drinks. Diet sodas and juice would be exempted.


CNN Money | U.S. adds 281,000 private-sector jobs
Private sector firms added 281,000 jobs in June, marking the strongest month for hiring since November 2012, according to payroll processing firm ADP (ADP).
CNN Money | Employers value skills over college degrees, workers say
While the vast majority of employees believe their college education has helped them in their career, 72% said getting trained in a specific skill is more highly valued by their employer, according to a survey of more than 2,000 adults by job listing site Glassdoor.
Daily Signal | How One State Made the Minimum Wage Meaningless
As policymakers in Washington, D.C., debate raising the federal minimum wage, entry-level workers in North Dakota enjoy pay levels nearly twice the current federal minimum.


Econ Comments & Analysis                                                                                            
WSJ | Argentine Consensus Emerges: Pay Off Debt
As Argentina struggles with a poor economy and the risk of default, a consensus has emerged among Argentines, business groups and ruling-party lawmakers that the government should settle a $1.5 billion debt with holdout bondholders—and do so soon.
CNBC | Where the student debt crisis really hits
With more than $1 trillion outstanding in student loans, and millennials holding off on everything from buying stocks to taking out mortgages, small wonder that people are worried.

CATO | Cato Spending Charts
How much does Congress spend on Veterans Affairs, the IRS, or Customs and Border Protection? How much has spending increased over time?