Tuesday, July 8, 2014

General Economics

FOX News | Mr. Obama, you can’t blame our economic troubles on weather
The economy took a bad hit during the first quarter this year.  It shrunk at an annual rate of 2.96 percent.  Since the beginning of 1947, there are only 16 of the 268 quarters experienced worse growth.
Market Watch | Small-business optimism index drops in June: NFIB
Small-business optimism dropped in June on a big decline in those who expect the economy to improve, according to a survey released Tuesday.

Econ Comments & Analysis                                                                                            
Bloomberg | A Correction Is Coming
Welcome back from the long holiday weekend. Before we left for our nation’s birthday celebration, markets had a little party of their own: The Dow had broken 17,000, the Standard & Poor's 500 Index had touched a record high and was spitting distance from crossing 2,000. Even the small-cap indexes such as the Russell 2000 and the S&P 600 have notched new highs. And the Nasdaq, up 255 percent since the March 2009 low, is less than 15 percent away from the record set in the dot-com-era market of 2000.
WSJ | Free People, Free Markets
Surveying a century and a quarter of journalism is a bracing exercise—at intervals depressing and inspiring. Depressing because bad ideas never die. But inspiring because a free society can rescue itself from periods of decline and despond not unlike the current moment. This is one lesson of 125 years of Journal editorials that promote free people and free markets.
Washington Times | The soft bigotry of low economic expectations
Many today are too young to know, or have forgotten, what a genuine robust recovery looks like. To paraphrase an old axiom, if you can’t learn from what was good about history, you’re doomed not to repeat it. But year after disappointing “year of Obama” and summer after “summer of recovery,” they insist on following the same failed liberal path.
CNN Money | Corporate profits: Can they keep going and going?
With stocks trading near all-time highs, that's the big question on investors' minds as second quarter earnings season gets underway Tuesday.

WSJ | Home-Price Drop Held Back Start-Up Hiring After the Recession
The steep drop in house prices during the 2007-2009 recession likely held back hiring by start-up companies during the recovery, which could help explain why overall U.S. job growth has been so weak, according to two San Francisco Fed economists.

Health Care

WSJ | Some Still Lack Coverage Under Health Law
Months after the sign-up deadline, thousands of Americans who purchased health insurance through the Affordable Care Act still don't have coverage due to problems in enrollment systems.

Econ Comments & Analysis                                                                                            
Real Clear Markets | Automatic Obamacare Enrollment Is Anti-Patient
With a new Avalere study showing that many Obamacare participants will face premium increases in the fall, the administration's proposed rule that would automatically reenroll Americans in their existing federal health exchange plan is likely to leave many people paying higher premiums than necessary. Plus, Uncle Sam will be unable to verify correct amounts of health insurance premium subsidies. America is not yet ready for auto enrollment in Obamacare.


Bloomberg | QE Should Only Be Emergency Tool, ECB Board Member Says
European Central Bank Executive Board member Sabine Lautenschlaeger said policy makers should only consider radical programs such as quantitative easing if the euro area is on the verge of deflation.
Bloomberg | ECB Summons Bankers for Catch-Up as Stress Test Looms
Europe’s lenders are running out of time to get their books in order before the European Central Bank passes judgment on them.

WSJ | Grand Central: Yellen Didn’t Rule Out Monetary Policy to Combat Bubbles
Federal Reserve Chairwoman Janet Yellen caused a stir last week when she appeared to rule out raising interest rates to tame financial bubbles. But a close reading of her comments suggests she actually went to great lengths to leave her options open.


Econ Comments & Analysis                                                                                            
CNN Money | More companies bail on U.S. for lower taxes
A new analysis found 47 companies have relocated to home bases overseas to take advantage of lower rates in the past 10 years through a merger process known as inversion.
Washington Times | The end of the progressive income tax
Press reports now state that the U.S. tax code is more than 77,000 pages and growing at a rapid rate. Obviously, no one individual or even teams of lawyers and accountants can fully understand all of this, including people at the Internal Revenue Service (IRS).
Mercatus | Low-Income Taxpayers Benefit Least from Mortgage Deduction
One of the most commonly cited justifications for the mortgage interest deduction (MID) is the claim that the deduction promotes homeownership among the middle class and supports industries that employ middle-class workers. But with 65.2 percent of all tax filers claiming to make less than $50,000, only 9.8 percent of these returns used the mortgage interest deduction.
CRS | Bonus Depreciation: Economic and Budgetary Issues
The Tax Extenders Act of 2013 (S. 1859), which would extend expiring tax provisions for a year, includes bonus depreciation and H.R. 4718 proposes to make bonus depreciation permanent. The temporary provisions enacted in the past for only a year or two and extended multiple times are generally referred to collectively as the "extenders."

Library of Economics | Why no Kansas miracle?
The past two years Kansas reduced its state income tax rates. As a result, the top rate of income tax faced by Kansas residents (combined state and federal) rose from 41.45% in 2012 to 48.3% in 2013 and then fell a tad to 48.2% in 2014 (if they don't itemize.) That's a pretty tiny drop in the top marginal tax rate in 2014, and a much bigger rise in 2013.


Bloomberg | Part-Time Jobs Surge Takes Little Away From U.S. Labor Recovery
A surge in part-time employment that was behind last month’s drop in the U.S. jobless rate takes little away from the overall picture of steady progress in the labor markets, economists say.
Market Watch | Why you’ll get a raise earlier than you think
Hiring is picking up, and the labor market is resembling that of late 2004 and 2005, right before the last cyclical move in wages. Add in the rising number of regions where full employment (about a 5.5% unemployment rate) is here or at hand, and the picture comes into better focus.
WSJ | Help Wanted: Jobs in Trucking Go Unfilled
Something strange is afoot in long-distance trucking that is also bedeviling other industries: Many jobs that pay well—and don't require expensive degrees—are going unfilled for months.
Washington Times | Global labor imbalance: Some countries see a surplus of jobs while others see higher unemployment
While it has had no trouble filling giant soccer stadiums for this summer’s World Cup, host country Brazil may not find it as easy to fill jobs for its economy in the decades to come.
Daily Signal | Organization Pushes for Ballot Referendum on Seattle $15 Minimum Wage
In Seattle, a grassroots organization has submitted a petition complete with nearly 20,000 signatures—well above the 16,000 signature prerequisite, calling for a ballot referendum to repeal the city’s minimum wage hike, which will eventually increase the hourly wage to $15 an hour.

Econ Comments & Analysis                                                                                            
Fiscal Times | Get Off the Dole and Get a Job: Ben Carson
Get a job. Weed a garden, wash cars, pick vegetables – whatever you have to do to make a living and avoid being on the dole. It can help save the U.S.A.  - See more at:

WSJ | Fewer People Are Quitting Their Jobs, And Why That’s Not Good
Payroll growth finally has taken off this year, rising solidly above 200,000 jobs per month in the first six months. But what lies beneath the headline number says a lot about the economic outlook. Economists at Goldman Sachs et out to gauge how dynamic the current labor markets are.


Washington Times | Maryland casinos report June revenue of $72M
Numbers released this week by the state Lottery and Gaming Control Agency show that the Maryland Live casino near Arundel Mills mall accounted for $56.5 million of the total, an increase of 10 percent from last June.

Econ Comments & Analysis                                                                                            
Mercatus | An Unfolding Fiscal Disaster
Imagine that it is 1937 and time for the first Social Security payroll taxes to be assessed on workers and their employers. Two years earlier, President Franklin D. Roosevelt’s new program was successfully sold to the American public as an ambitious yet fiscally responsible, self-financing expansion of social insurance protections. The new Federal Insurance Contributions Act tax—a payroll tax of 2 percent on earnings—will pay for it.
Mercatus | The Unseen Costs of the Export-Import Bank
We don’t agree on much in Washington. But given all of the economic and social problems our nation faces, everyone should agree that the federal government should not direct our limited public resources primarily to wealthy, politically connected corporations. This is what the Export-Import Bank does.