Economics Roundtable

Technical Problems 3/9/15

The website was down several hours today, but is back up now.


May 2014 Payroll Employment

After 76 months, we finally got back to the prerecession level of payroll employment.

Click on the image to get a bigger version.


Jobs

The best summary of the state of our economy is the graph (below) of employment as a fraction of population for people over 16 years old. The decrease is large, but the most troubling feature of the graph is the flat trend .


Click on the image to get a bigger version.


Graph-of-the-Year Candidates

Donald Marron likes European interest rates. Click on the image to get a bigger version. Can you find three distinct subperiods?

Brad DeLong favors the U.S. gdp gap.


Remember M1?

Money Supply M1 growth is now over 20% per year over a 12 month lag. M1 growth has touched 20% before, but not with excess reserves of $1.6 trillion. Where is M1 headed?


Click on the chart for a larger version.


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April 20, 2015, 9:03 pm, 1458602
CoreLogic released the Southern California report today for March (CoreLogic acquired DataQuick).

The data shows 18,156 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties in March.

That was up 35.6% from 13,650 sales in February, and ...


April 20, 2015, 8:04 pm, 1458600
(Don Boudreaux)

In a speech in May 1932 presidential candidate Franklin D. Roosevelt famously said the following:

The country needs and, unless I mistake its temper, the country demands bold, persistent experimentation.  It is common sense to take a method and try it: If it fails, admit it frankly and try ...


April 20, 2015, 7:23 pm, 1458599

At Seeking Alpha, Joseph Calhoun responds to Friday's macroblog post, which noted that, over the course of the recovery, first-quarter gross domestic product (GDP) growth has on average been slower than the quarterly performance over the balance of the year:

... the "between-the-lines" meaning ...


April 20, 2015, 7:03 pm, 1458555

Imagine running a small business and being assessed a penalty by the IRS. Then imagine being told by the IRS that the only way to avoid the penalty is to commit a serious felony, laundering money. This Kafkaesque nightmare actually became reality for a Colorado marijuana dispensary called Allgreens ...


April 20, 2015, 7:03 pm, 1458554
Chairman of the House Financial Services Committee Jeb Hensarling Joshua Roberts/Reuters

The head of the U.S. House Financial Services Committee calls “inadequate” the Federal Reserve’s internal ...


April 20, 2015, 7:03 pm, 1458553
Bank of Mexico Governor Agustin Carstens Reuters

The global economic recovery, particularly among rich nations, is still very much dependent on heavy support from central banks in ...


April 20, 2015, 7:03 pm, 1458552
From Matthew Graham at Mortgage News Daily: Mortgage Rates Slide Sideways Again

Mortgage rates figure if they can't be pushing down to new record lows, they might as well pass the time by shooting for different records. This time around, it's the record for FLATNESS! We calculate ...


April 20, 2015, 6:04 pm, 1458548

It is very rare for an entirely new issue to emerge in public opinion polls. The environment is one such issue. Before the late 1960s there were a handful of questions about related issues such as the population explosion and sanitation. But the environment itself emerged powerfully and quickly in ...


April 20, 2015, 5:33 pm, 1458546
Greece to Seize Local Government Cash

Robbing Peter to pay Paul took another leap forward in Greece today as Tsipras to Seize Public-Sector Funds to Keep Greece Afloat.

Running out of options to keep his country afloat, Greek Prime Minister Alexis Tsipras ordered local governments ...


April 20, 2015, 5:03 pm, 1458485

Reserve Bank of India Governor Raghuram Rajan is keeping his options open for additional reductions in benchmark interest rates.

The central bank has cut rates twice this year and could cut rates further if it sees more signs that inflation is easing, Mr. Rajan said in an interview with The Wall ...


April 20, 2015, 5:03 pm, 1458484
Paul Volcker, former Federal Reserve chairman, told The Wall Street Journal Wednesday the Fed’s large balance sheet concerns him. brendan smialowski/Agence France-Presse/Getty Images

Paul Volcker is the ...


April 20, 2015, 5:03 pm, 1458483
Getty Images Getty Images

There’s a saying: Don’t mess with Texas. But that’s not stopping


April 20, 2015, 4:44 pm, 1458482

Chapter 11's ability to empower true reorganization has received much criticism of late in light of an increasingly held assumption that most Chapter 11 cases end in a 363 sale of the debtor's assets. Around this time last year, the American Bankruptcy Institute and the University of Illinois ...


April 20, 2015, 4:04 pm, 1458478

Last week, the Senate reauthorized the Maternal, Infant and Early Childhood Home Visiting (MIECHV) program with a strongly bipartisan vote of 92 to eight, following a House vote this past March of 392 to seven supporting the program. Policymakers are on the right side of history. Voluntary home visiting programs, ...


April 20, 2015, 4:04 pm, 1458477

“I would bet on globalization slowly being in abeyance,” tech entrepreneur Peter Thiel said in a video interview with George Mason University economist Tyler Cowen. “I think with the benefit of hindsight, we will realize that 2007 was not just the peak ...


April 20, 2015, 4:04 pm, 1458476

Key Points

China’s proposed counterterrorism law, which applies to all information technology (IT) companies operating in China, and US “legal-intercept” regulations, which govern all IT companies operating in the United States, are officially acknowledged frameworks to counter terrorist and criminal behavior.Despite the similarities in these regulations, President Obama has criticized China’s ...


April 20, 2015, 4:04 pm, 1458475

On this episode of AEI’s Idea Makers podcast, our guest is L.E. Simmons, chairman of SCF Partners, where he has guided the investment of over 2.5 billion dollars in private equity capital used to build energy service and equipment companies. ...


April 20, 2015, 3:33 pm, 1458468
At long last the deniers have thrown in the towel. Grexit is now the base case as Europe Braces for Messy Greek Endgame.

It’s still possible that Greece can remain in the eurozone—though that is no longer the base case for many policy makers. At the very ...


April 20, 2015, 3:33 pm, 1458467

You know those before and after pictures of Presidents that show just how much being POTUS ages a person?

5 years as a Department Chair* ...


April 20, 2015, 3:03 pm, 1458406
Bank of Canada Governor Stephen Poloz said Monday he isn’t worried about the impact of Federal Reserve interest rate rises on his country. Reuters

Canada’s central bank ...


April 20, 2015, 3:03 pm, 1458404

NEW YORK—Banque de France governor Christian Noyer offered support for the European Central Bank’s bond buying stimulus program.

“Unconventional monetary policies are necessary but complex,” Mr. Noyer said at the Paris Europlace International Financial Forum held in New York. Because these policies are challenging, central banks that employ them must weigh ...


April 20, 2015, 3:03 pm, 1458405
Agence France-Presse/Getty Images

Tax cuts are an effective way to bolster a weak economy and create jobs—as long as they are targeted at the bottom 90% of income earners.

That’s according ...


April 20, 2015, 3:03 pm, 1458403

Let's hope the Fed is listening:

Labor Market Slack and Monetary Policy, by David G. Blanchflower and Andrew T. Levin, NBER Working Paper No. 21094: In the wake of a severe recession and a sluggish recovery, labor market slack cannot be gauged solely in terms of the conventional measure of ...


April 20, 2015, 2:44 pm, 1458402

Over at Dealb%k, I have a new column up about Colt's rather aggressive dual-track exchange offer and prepack.

In short, it involves ...


April 20, 2015, 2:05 pm, 1458397

No.  From Thomas J. Miles and Adam B. Cox in the JLE:

Prior research investigates whether immigrants commit more crimes than native-born people. Yet the central policy used to regulate immigration — detention and deportation — has received little empirical evaluation. This article studies a recent policy innovation called ...


April 20, 2015, 2:05 pm, 1458398

April 20, 2015, 2:05 pm, 1458400

That is the next NBER macro paper at these sessions, by Fang, Gu, Xiong, and Zhou, here is the pdf.  The abstract is this:

We construct housing price indices for 120 major cities in China in 2003-2013 based on sequential sales of new homes with the same housing ...


April 20, 2015, 2:05 pm, 1458399

That is the next NBER macro session, the authors are Acemoglu, Akcigit, and Kerr, the pdf is here, and here is the abstract:

The propagation of macroeconomic shocks through input-output and geographic networks can be a powerful driver of macroeconomic fluctuations. We first exposit that in the presence ...


April 20, 2015, 2:05 pm, 1458396

That is the next (and for me final) NBER paper from the macro workshop, by Barnichon and Figura, the pdf is here.  Their main claim is quite startling, and very important if true.  Here is the abstract:

The US labor market has witnessed two apparently unrelated trends in the ...


April 20, 2015, 2:05 pm, 1458395

The link is here, more or less unedited I am told.  Somewhere in there (Saturday, 11 a.m.) is a panel with myself, Kenneth Arrow, Sam Peltzman, Gary Libecap and others on how academia and publishing models are evolving.

There are very likely other good bits too, but I did ...


April 20, 2015, 2:05 pm, 1458393

Joshua Rothman writes in The New Yorker about a new book by H.J. Jackson, on the romantic poets:

Truly long-term literary endurance depends, Jackson writes, on “regular reinterpretation,” and, for that to happen, your writing has to be rich and multi-dimensional. That doesn’t mean, though, that other factors can’t ...


April 20, 2015, 2:05 pm, 1458392

I was asked this this question on Quora. Here’s my answer:

Writing an original dissertation.

Anyone who makes it into graduate school has had at least 16 years of learning and, as a result, most graduate students are good learners. A dissertation, however, requires the creation or discovery of new knowledge. On the ...


April 20, 2015, 2:05 pm, 1458394

Mike Irvine is set to make a splash in the dry world of academe. The University of Victoria student is getting ready to defend his masters thesis in education from below the surface of the Salish Sea off the coast of British Columbia.

And lest you think he’s not taking his thesis defense seriously, ...


April 20, 2015, 2:05 pm, 1458390

That is the new Philip A. Wallach book and the subtitle is Legality, Legitimacy, and the Responses to the 2008 Financial CrisisPhilip is one of the underrated up-and-coming young policy economists, and this book focuses on the financial crisis and the law.  It is original, ...


April 20, 2015, 2:05 pm, 1458389

Let’s say that you and a casual friend meet for lunch two or three times a year, but otherwise have little contact.  One day you would say to the friend “let’s become Batman and Robin and fight violent crime together in Gotham City, trusting our lives to each other along ...


April 20, 2015, 2:05 pm, 1458391

April 20, 2015, 2:05 pm, 1458388

From The Slovenia Times:

“Our exposure to Greece is 2.7% of GDP, which was in a year after we had a 8% fall in GDP and when we had to slash pay and economise in all areas.”

This is why Slovenia will insist on Greece continuing with the restructuring and ...


April 20, 2015, 2:05 pm, 1458386

April 20, 2015, 2:05 pm, 1458387

Here is a long and excellent post, whereby Robin outs himself as a strange kind of environmentalist.  Do need the whole thing, but here is one summary excerpt:

So, bottom line, the future great filter scenario that most concerns me is one where our solar-system-bound descendants have killed most ...


April 20, 2015, 2:04 pm, 1458385
Dan here…Worth reading the whole 12 pages.   (Hat tip New Deal democrat) Do economic crises reflect crises in economics? Keynote address, ‘Rethinking Economics’ conference, Stiftverband für die Deutsche Wissenschaft/Handelsblatt, Frankfurt am Main, 23 January 2012. Diane Coyle, Enlightenment Economics and Institute of Political and Economic Governance, University of Manchester ...


April 20, 2015, 2:04 pm, 1458384

Recent research on the labor market returns to short-term educational credentials—particularly certificates and associate degrees in technical fields—suggests that such training can be as lucrative, or more so, than a four-year degree. For many working adults without a college degree, completing such a ...


April 20, 2015, 2:04 pm, 1458383

The EIA released new energy data recently showing that the US had the most energy-efficient economy in history last year, based on the amount of energy expended to produce each real dollar of ...


April 20, 2015, 1:33 pm, 1458379
In many blog posts I expressed disgust at the failure of Econ 101 teachers to convey some of our most important ideas. Since people sleep through intro micro, many go on to not anticipate the unintended consequences of bad policies such as raising the minimum wage. In today's NY Times, ...


April 20, 2015, 1:33 pm, 1458376

Every year on Earth Day we learn how bad humanity’s economic development is for the health of the planet, but maybe that is the wrong message. Maybe we should instead reflect on how human progress, especially through the use of fossil fuels, has actually made our ...


April 20, 2015, 1:33 pm, 1458378

Do a Google search for the term “global warming consensus” and you’ll find more than 23,000 links (and 18,000,000 results without the quotations marks). The first link is to this NASA webpage about “scientific consensus” with the following bold statement:

Ninety-seven percent of climate scientists agree that climate-warming ...


April 20, 2015, 1:33 pm, 1458377

The EIA released new energy data recently showing that the US had the most energy-efficient economy in history last year, based on the amount of energy expended to produce each real dollar of Gross Domestic Product (GDP). In 2014, it required only ...


April 20, 2015, 1:03 pm, 1458323

In states with legalized marijuana, legislatures have partially converted an almost completely untaxed black market industry into a taxed and regulated industry that helps fund schools, healthcare, law enforcement, research, substance abuse treatment, and other government expenses. However, this conversion is not total: states have elected to tax marijuana sales ...


April 20, 2015, 1:03 pm, 1458322
Reuters

China’s central bank has long been critical of the bond-buying programs adopted by its counterparts in developed countries. Now, it’s pondering its own version of such easing and ...


April 20, 2015, 1:03 pm, 1458320

The Wall Street Journal’s Daily Report on Global Central Banks for Monday, April 20, 2015:

Sign up for the newsletter: http://on.wsj.com/grandcentralsignup


Highlights

Hilsenrath’s Take: What If This Is As Good As It Gets? China’s Central Bank ...


April 20, 2015, 1:03 pm, 1458321

 

MONDAY

8:30 a.m. EDT: New York Fed’s Dudley speaks in New York 1300 GMT (9:00 a.m. EDT) ECB’s Constancio speaks in Brussels

TUESDAY

National Bank of Hungary releases a policy statement

WEDNESDAY

0830 GMT (4:30 a.m. EDT): Bank ...


April 20, 2015, 1:03 pm, 1458319

Federal Reserve Bank of New York President William Dudley cast a less certain light on outlook for short-term rate increases in remarks Monday, noting that he hopes weakness over the start of the year will prove temporary and allow the Fed to boost borrowing costs.

“Hopefully” the economic data will “support ...


April 20, 2015, 1:03 pm, 1458316
Agence France-Presse/Getty Images

Tax cuts are an effective way to bolster a weak economy and create jobs—as long as they are targeted at the bottom 90% of income earners.

That’s according ...


April 20, 2015, 1:03 pm, 1458318
Tyson Trish/Associated Press

The wealthiest 5% of retirees could see their Social Security benefits clipped under a proposal advanced by Gov. Chris Christie, according to some ...


April 20, 2015, 1:03 pm, 1458317
Bank of Canada Governor Stephen Poloz said Monday he isn’t worried about the impact of Federal Reserve interest rate rises on his country. Reuters

Canada’s central bank ...


April 20, 2015, 1:03 pm, 1458315

This is from the Liberty Street Economics Blog at the NY Fed:

Credit Supply and the Housing Boom, by Alejandro Justiniano, Giorgio Primiceri, and Andrea Tambalotti: There is no consensus among economists as to what drove the rise of U.S. house prices and household debt in the period leading ...


April 20, 2015, 12:44 pm, 1458314
A


April 20, 2015, 12:44 pm, 1458312
A


April 20, 2015, 12:44 pm, 1458313
A


April 20, 2015, 12:04 pm, 1458310
(April 20, 2015 11:10 AM, by Scott Sumner) David Henderson has a good post on the way that textbooks teach the substitution effect. I have one other bone to pick with principles textbooks---they don't clearly explain to students how to avoid "reasoning from a price change." Start with... (0 COMMENTS)


April 20, 2015, 12:04 pm, 1458309

April 20, 2015, 12:04 pm, 1458308

In his original paper, Gordon Moore’s idea was to give people a sense of what was possible. His idea was to make electronics so cheap that we could put them into tiny computers that everybody could use. He wanted to show people that very, very rapidly this technology would get ...


April 20, 2015, 12:04 pm, 1458305

Do a Google search for the term “global warming consensus” and you’ll find more than 23,000 links (and 18,000,000 results without the quotations marks). The first link is to this


April 20, 2015, 12:04 pm, 1458307

Ben Bernanke, a think-tanker who has for some reason rapidly moved into the top rank of economics bloggers, has written a post that seems destined to be influential. It’s about various proposals to reform monetary policy.

He’s open-minded about the proposals: He ...


April 20, 2015, 12:04 pm, 1458306

A few quick facts on entitlement spending: (a) CBO projects federal spending on Medicare and Social Security over the next 25 years will rise by roughly 3 percentage points of GDP,  to 11% from 8%; (b) an aging US population will be


April 20, 2015, 11:23 am, 1458304
Jérémie Cohen-Setton at Bruegel does a great job, as usual, rounding up recent blog posts on a specific topic. This time: a critique of modern macro. Can the models built during the Great Moderation explain what happened after the Great Recession?

I would say that ...


April 20, 2015, 11:03 am, 1458241
Tyson Trish/Associated Press

The wealthiest 5% of retirees could see their Social Security benefits clipped under a proposal advanced by Gov. Chris Christie, according to some ...


April 20, 2015, 11:03 am, 1458240

Is there any hope for Greece?:

Greece on the Brink, by Paul Krugman, Commentary, NY Times: ... At the end of 2009 Greece faced a crisis driven by two factors: High debt, and inflated costs and prices that left the country uncompetitive.

Europe responded with loans that kept the cash ...


April 20, 2015, 11:03 am, 1458239
Note: LA area ports were impacted by labor negotiations that were settled on February 21st.

Container traffic gives us an idea about the volume of goods being exported and imported - and usually some hints about the trade report for February since LA area ports handle about 40% of ...


April 20, 2015, 10:44 am, 1458238

Lately I have been teaching courses with names such as "Global and Economic Justice" and "History, Impacts and Regulation of Consumer Credit" instead of "Bankruptcy," "Secured Transactions" and "Chapter 11 Reorganizations." So I have been reading different books and listening to different speakers. A lecture I attended recently by ...


April 20, 2015, 10:44 am, 1458237

Russia has threatened to take Ukraine to arbitration unless the country pays its $3 billion bond in full. As Anna ...


April 20, 2015, 10:36 am, 1458236
Economic activity in March slumped to the softest pace in 31 months, according to this morning’s update of the Chicago Fed National Activity Index. The three-month moving average of this business cycle benchmark (CFNAI-MA3) decreased to -0.27 last month from February’s -0.12 reading. Last month’s estimate is the lowest since ...


April 20, 2015, 10:04 am, 1458229

The United States is generous, giving upwards of $30 billion annually in foreign aid. While critics point out that other countries give more in terms of percentage of GDP, the sum total that the ...


April 20, 2015, 10:04 am, 1458228

General Electric’s withdrawal from the financial-services business is being hailed in Washington as a victory over “shadow banking.” This is akin to celebrating the criminal-justice system when a prisoner hangs himself in his cell.

GE Capital was the quintessential “shadow bank”—a finance company that could compete with insured banks because it ...


April 20, 2015, 9:34 am, 1458223
The consumption based model is not as bad as you think. (This is a problem set for my online PhD class, and I thought the result would be interesting to blog readers.)

I use 4th quarter to 4th quarter nondurable + services consumption, and corresponding ...


April 20, 2015, 9:33 am, 1458222
Matt Kahn:

... two friends of mine have released a new book "Climate Shock". In Wagner and Weitzman's new book, they present a well written analysis of the tradeoffs we collectively face as we unintentionally unleash climate change. They argue that a risk averse person or nation should buy insurance ...


April 20, 2015, 9:33 am, 1458221

“The demand we’re placing on the aquifer and the deep bedrock drilling, which is going on at an alarmingly fast pace, is really scary,” said Tricia Blattler, executive director of the Tulare County Farm Bureau. “Folks are really concerned we’re not going to be able find water in the groundwater ...


April 20, 2015, 9:33 am, 1458220

The ongoing difficulties in Greece – combined with the ECB’s dramatic actions to ward off deflation – are distracting attention from what may be the euro area’s biggest and most pervasive problem: debt.

You wouldn’t know it from the record low level of government bond yields, but much of Europe ...


April 20, 2015, 9:03 am, 1458159

The Wall Street Journal’s Daily Report on Global Central Banks for Monday, April 20, 2015:

Sign up for the newsletter: http://on.wsj.com/grandcentralsignup


Highlights

Hilsenrath’s Take: What If This Is As Good As It Gets? China’s Central Bank ...


April 20, 2015, 9:03 am, 1458158

NEW YORK–Federal Reserve Bank of New York President William Dudley said Monday he is hopeful that weakness seen over the start of the year won’t last, in remarks that indicated he still hopes to raise short-term interest rates at some point this year.

“Because the economic outlook is uncertain, I ...


April 20, 2015, 9:03 am, 1458157
The Chicago Fed released the national activity index (a composite index of other indicators): Index shows economic growth slowed in March

Led by declines in production-related indicators, the Chicago Fed National Activity Index (CFNAI) moved down to –0.42 in March from –0.18 in February.

Two of the four ...


April 20, 2015, 8:35 am, 1458156
The unusually wide spread at the outer edges for the trailing performances of the major asset classes via our standard set of ETF proxies has been squeezed a bit. The compression is due mostly to recent weakness in US real estate investment trusts (REITs). Securitized real estate is still in ...


April 20, 2015, 8:35 am, 1458155

The corporate-only tax reform could raise taxes on many small businesses, unless… TPC’s Eric Toder testified last week to the House Small Business Committee on how  corporate tax reform could hurt small businesses that usually report income on their owner’s individual tax returns. In his latest blog post, he ...


April 20, 2015, 8:04 am, 1458153
(Don Boudreaux)

… is from page 10 of Sheldon Richman’s essay “Monopoly and Aggression,” which appears in the April 2015 issue (Vol. 26, No. 4) of Future of Freedom (original emphasis; the quotations from Frederic Bastiat are from his 1850 volume, Economic Harmonies):

Bastiat praised the competitive market process ...


April 20, 2015, 8:04 am, 1458152

Key Points

Many adults without a college degree aspire to some higher credential, but most overestimate the cost of higher education, which could deter them from furthering their education.Many adults without a degree in our survey were uncertain as to the wage returns to different postsecondary pathways. Those who did offer ...


April 20, 2015, 7:33 am, 1458146

How does my former home state, Florida, keep coming up with these things?

Never mind, I don't want to know.

See also "New Designer Drug Flakka Gives Users Super-Human Strength".

“It reminds me of Angel Dust in the early 80s,” says Jon Lapook, MD. “I was in ...


April 20, 2015, 7:33 am, 1458144

Since I've seen the "80 percent" figure used in a number of places, this piece is timely and useful.

To be clear, whatever the figure, California farmers are using too much water, water whose costs exceed their benefits. But that is because of government subsidies and those ...


April 20, 2015, 7:33 am, 1458145

This sounds like an excellent idea.

Some research led Sternberg to realize that most seniors wanted to stay in their homes.

To help serve these seniors, Sternberg is launching a service calledHonor, which aims to match seniors with professionals who can take care of them ...


April 20, 2015, 7:33 am, 1458143

As usual, it's either laugh or cry, you decide.

"Springtime in Washington".

It reminds me why Americans are so wary of Washington.

In the spring of 1999, you see, some culprits had been chopping down cherry trees.

The National Park Service, in a state of high ...


April 20, 2015, 7:33 am, 1458142

See "The Problem With Satisfied Patients" wherein HHS was apparently shocked to learn an important economic idea: you get what you pay for but often not in the way you expect.

When Department of Health and Human Services administrators decided to base 30 percent of hospitals’ Medicare ...


April 20, 2015, 7:33 am, 1458141
Bad news on Chicago is deep and broad:

The Chicago Public School System has a $1.1 Billion Budget Hole in $5.9 Billion BudgetA $228 to $263 million derivative time bomb just triggered on the Chicago Board of Education Chicago Public Schools may be out of cash in 30 ...


April 20, 2015, 7:33 am, 1458140
Alejandro Justiniano, Giorgio Primiceri, and Andrea Tambalotti




There is no consensus among economists as to what drove the rise of U.S. house prices and household debt ...


April 20, 2015, 7:03 am, 1458079
Reuters

China’s central bank has long been critical of the bond-buying programs adopted by its counterparts in developed countries. Now, it’s pondering its own version of such easing and ...


April 20, 2015, 7:03 am, 1458078

 

MONDAY

8:30 a.m. EDT: New York Fed’s Dudley speaks in New York 1300 GMT (9:00 a.m. EDT) ECB’s Constancio speaks in Brussels

TUESDAY

National Bank of Hungary releases a policy statement

WEDNESDAY

0830 GMT (4:30 a.m. EDT): Bank ...


April 20, 2015, 6:44 am, 1458077

This year’s IMF conference, “Rethinking Macroeconomic Policy III”, gathered many of the world’s greatest economists to reflect on the state of post-Global Crisis macroeconomics. This column, which presents remarks by the IMF’s Chief Economist Olivier Blanchard, argues that much detailed work has been done. The trenches are being dug, but ...


April 20, 2015, 6:44 am, 1458076

Scott Sumner, of Bentley University talks with EconTalk host Russ Roberts about interest rates. Sumner suggests that professional economists sometimes confuse cause and effect with respect to prices and quantities. Low interest rates need not encourage investment for example, if interest rates are low because ...


April 20, 2015, 6:35 am, 1458075
● US leading indicator points to slower growth | Reuters ● US consumer sentiment rises in April | Reuters ● US Consumer Prices Tick Up, in Latest Sign of Emerging Inflation | WSJ ● China’s central bank enters stimulus mode | CNN ● China bank move stokes global worry | ...


April 20, 2015, 6:04 am, 1458074

Key Points

AEI’s Center on Higher Education Reform commissioned four case studies on high-quality occupational training programs at US schools—including one high school and several higher education institutions—that strive to equip students with marketable job skills and prepare them for the world of work. General takeaways include:

Austin Polytechnical Academy—a high school ...


April 20, 2015, 5:33 am, 1458072

Rabbi Ed Feinstein:

This is the epitome of chutzpah. The human being dresses God down in no unsubtle terms.Far be it from You!The original Hebrewhallilah lechais actually much more earthy. The connotation is closer to my grandmother’s Yiddish curse,Shonda! Herpah!“Shame on You! You’re better than that!” Abraham ...


April 20, 2015, 5:33 am, 1458071



(p. 252) Chiara Criscuolo, Peter N. Gal, and Carlo Menon compile empirical evidence concerning "The Dynamics of Employment Growth: New Evidence from 18 Countries." "[N]ot all small businesses are net job creators, showing that only young businesses--predominantly small--create a disproportionate number of jobs, confirming recent evidence for ...


April 20, 2015, 5:03 am, 1458034

When it comes to its national debt, how much ruin is there in a nation?

Our question about the amount ...


April 20, 2015, 5:03 am, 1458033

April 20, 2015, 2:44 am, 1457990

Credits extended bilaterally between firms, so called trade credits, are particularly expensive yet many firms use it, especially for international transactions. This column argues that such cash-in-advance financing serves as a credible signal of quality. Data from a unique survey of German firms show that it fosters export participation in ...


April 20, 2015, 2:04 am, 1457989

If you have trouble registering for this event, please email conferences@aei.org.

In her insightful new book, “And the Good News Is … : Lessons and Advice from the Bright Side” (Twelve, April 2015), former White House Press Secretary Dana Perino reveals previously unheard stories from her years in the George W. ...


April 20, 2015, 1:33 am, 1457988

As Gadfly pointed out in the comments below my George Carlin post/video earlier today, George Carlin and Michael Crichton were of the same mind. This is from the prologue to Chrichton’s two-volume book “Jurassic Park and Congo”:

You think man can destroy the planet? What intoxicating vanity. Let me ...


April 20, 2015, 1:03 am, 1457969
Kim Kyung-Hoon/Reuters

Global central bankers don’t expect Chinese officials to devalue their currency as part of a widening campaign to boost output in the world’s second-largest economy.

Chinese authorities took ...


April 20, 2015, 1:03 am, 1457971
Mexican Finance Minister Luis Videgaray said on Saturday that he wants an orderly appreciation of the dollar. Reuters

Finance officials from the world’s largest emerging-market nations are ...


April 20, 2015, 1:03 am, 1457970

WASHINGTON—The European economy is poised to contribute to the global economic recovery after years of languishing through stagnation and recession, Austria’s central bank Governor Ewald Nowotny signaled in an interview, as the region reaps the benefit of lower oil prices, a weaker exchange rate and stepped up investment.

“There clearly is ...


April 20, 2015, 1:03 am, 1457968
A pedestrian walks past the People’s Bank of China headquarters in Beijing, China, March 2, 2015. China’s central bank on Sunday cut the reserve requirement ratio by a full percentage point.


April 19, 2015, 11:03 pm, 1457963
A pedestrian walks past the People’s Bank of China headquarters in Beijing, China, March 2, 2015. China’s central bank on Sunday cut the reserve requirement ratio by a full percentage point.


April 19, 2015, 10:44 pm, 1457962
A


April 19, 2015, 9:03 pm, 1457954

The economy has steadily been moving closer to the Fed’s long-run objectives. But we’re still not there yet.

Congress has given the Federal Reserve the dual mandates of maintaining price stability and full employment. The Fed has interpreted this in practice to mean an inflation rate of ...


April 19, 2015, 9:03 pm, 1457953
From the NY Times: Greece Flashes Warning Signals About Its Debt

By the standards of his frenzied schedule here last week, the meeting on Friday between Yanis Varoufakis, the Greek finance minister, and Lee C. Buchheit, the dean of international debt lawyers, was a quiet one.
...
But the ...


April 19, 2015, 8:34 pm, 1457952
Teaser:

The ...


April 19, 2015, 7:03 pm, 1457951
Kim Kyung-Hoon/Reuters

Global central bankers don’t expect Chinese officials to devalue their currency as part of a widening campaign to boost output in the world’s second-largest economy.

Chinese authorities took ...


April 19, 2015, 6:04 pm, 1457949
I will present a way to determine potential real GDP using a regression of past data. First take the official CBO potential and subtract it from real GDP. When the red line is above zero (0), real GDP is over potential. Normally the red line rises above potential before a ...


April 19, 2015, 6:04 pm, 1457948

Five years ago, the BP oil spill captured the nation’s attention. Americans care deeply about environmental protection, and they paid attention to the extensive news coverage of the incident. Immediately after the spill, in a Pew Research Center poll from late May 2010, 55% said they were following the story ...


April 19, 2015, 4:34 pm, 1457947

After the new trailer forStar Wars: The Force Awakens was released on Friday, Disney’s stock price skyrocketed:

A group of analysts who got a 20-minute preview of “Star Wars” a few weeks before the film’s ...


April 19, 2015, 4:34 pm, 1457946

Running into economic bloggers Mark Thoma, of the University of Oregon, and Tyler Cowen, of George Mason University, at the annual Conference on Macroeconomics at the National Bureau of Economic Research last week, I was forced to reflect on the way I keep track of developments that, ...


April 19, 2015, 3:33 pm, 1457942

Green trigger warning: This blog post may be upsetting to those who consider Earth Day to be a green holy day of obligation in their religions of ecology or their churches of sustainability.

Earth Day is coming up this Wednesday (April 22) and it’s the 45th anniversary this ...


April 19, 2015, 2:04 pm, 1457935
(April 19, 2015 02:54 PM, by David Henderson) In the Energy Economics course I'm teaching this quarter, I have a number of students who have never had economics before. So I'm using selected chapters from the Microeconomics portion of Greg Mankiw's Principles of Economics, and I add a... (2 COMMENTS)


April 19, 2015, 2:04 pm, 1457934
(Don Boudreaux)

Joel Kotkin has alway been good.  But he is (in my opinion) getting even better.  His essay on the sorry state of California, in today’s Daily Beast, is a gem.  (HT Manny Klausner)  Below are several slices (but do read the whole thing):

California has met the future, and ...


April 19, 2015, 2:04 pm, 1457933

Green trigger warning: This blog post may be upsetting to those who consider Earth Day to be a green holy day of obligation in their religions of ecology or their churches of sustainability.

Earth Day is coming up this Wednesday (April 22) and it’s the 45th anniversary this ...


April 19, 2015, 1:03 pm, 1457930

WASHINGTON—The European economy is poised to contribute to the global economic recovery after years of languishing through stagnation and recession, Austria’s central bank Governor Ewald Nowotny signaled in an interview, as the region reaps the benefit of lower oil prices, a weaker exchange rate and stepped up investment.

“There clearly is ...


April 19, 2015, 12:35 pm, 1457929

By James Kwak

Is it the money?

No.

Federal Reserve Chair Ben Bernanke, the man who saved the global economy, is becoming an adviser for Citadel, a hedge fund management company. Bernanke will provide advice to Citadel’s fund managers and will also meet with ...


April 19, 2015, 11:33 am, 1457920
In 1972, Issac Ehrlich and Gary Becker wrote an important JPE paper on Self Protection and Insurance. An ungated version is available here. To provide some intuition, consider a random variable such as your house catching on fire. If this event occurs, you suffer both financial damage and ...


April 19, 2015, 11:03 am, 1457915
The NAR will report March Existing Home Sales on Wednesday, April 22nd. The consensus, according to Bloomberg, is that the NAR will report sales of 5.04 million. Housing economist Tom Lawler estimates the NAR will report sales of 5.18 million on a seasonally adjusted annual rate (SAAR) ...


April 19, 2015, 10:44 am, 1457914

This week's guest, Phil Rosenzweig joined EconTalk host Russ Roberts to talk about his new book, Left Brain, Right Stuff.

We'd like to know what you took away from this week's recorded conversation, and hopefully spark some more here online. Use the prompts below, and share your thoughts in ...


April 19, 2015, 10:04 am, 1457911
(Don Boudreaux)

Does more-strict enforcement of immigration restrictions reduce crime in the U.S.?  Likely not.  (HT Tyler Cowen)

Here’s Brendan O’Neill on the utter superficiality of politics.  (HT Walter Grinder)

Congratulations to Chapman University law professor Tom Bell for winning the 2015 Charles G. Koch Outstanding Institute for Humane Studies ...


April 19, 2015, 9:03 am, 1457898

From Vox EU:

How immigrants and job mobility help low-skilled workers, by Mette Foged, Giovanni Peri: Existing studies – largely based on the analyses of large immigration episodes (e.g. Friedberg 2001, Card 1991), and the experience of the US and the UK (Ottaviano and Peri 2012, Manacorda et al ...


April 19, 2015, 8:04 am, 1457897
(Don Boudreaux)

… is from page 218 of Bruno Leoni’s pioneering 1963 essay “Law and Economy in the Making,” as reprinted in the appendix to the 1991 Liberty Fund edition of Leoni’s 1961 volume, Freedom and the Law:

Law, like language, is not a gadget that a man can contrive at ...


April 19, 2015, 7:33 am, 1457895

As someone born in the great state of Texas, I found this quite interesting.


April 19, 2015, 7:23 am, 1457894

Readers Question: I only recently discovered your site, which is spectacular, and have been reading every article since then. However, I found that two of your articles are contradicting. In your article “Problems of Deflation” you state that the current ...


April 19, 2015, 6:04 am, 1457861
My regular column is available to subscribers on www.thesundaytimes.co.uk This is an excerpt. I would not want anybody to think a theme is developing here but, having warned last week that we should take economists’ views on austerity with...


April 19, 2015, 5:33 am, 1457859

It's not every day--or even every year--you see a goal like this.


April 19, 2015, 5:03 am, 1457827

April 19, 2015, 5:03 am, 1457826

April 19, 2015, 3:23 am, 1457825

Photo Credit: Simon Cunningham

How does capital get allocated to the public stock markets?  Through the following means:

Initial Public Offerings [IPOs]Follow-on offerings of stock (including PIPEs, etc.)Employees who give up wage income in exchange for stock, or contingent ...


April 19, 2015, 2:44 am, 1457778

The inflow of low-skilled migrants may encourage natives to upgrade their skills, taking advantage of immigrant-native complementarity. This column uses exogenous dispersion of refugees in Denmark to investigate this issue. The findings confirm that for low-skilled native workers, the presence of refugee-country immigrants spurred mobility and increased specialisation into complex ...