Economics Roundtable

Technical Problems 1/21/15

The website was down for a day and a half, 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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January 27, 2015, 10:44 pm, 1411128

Bank resolution is a key pillar of the European Banking Union. This column argues that the current structure of large EU banks is not conducive to an effective and unbiased resolution procedure. The authors would require systemically important banks to reorganise into a ‘holding company’ structure, where the parent company ...


January 27, 2015, 10:44 pm, 1411127

In the aftermath of the Global Crisis, international banking is undergoing structural adjustments. This column investigates the role of policy-related drivers of changes in cross-border bank lending since the Crisis. The findings indicate that changes in regulatory policies are important push and pull factors of foreign credit. The empirical evidence ...


January 27, 2015, 10:44 pm, 1411126
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January 27, 2015, 10:44 pm, 1411125

This week, we want to further the learning associated with Alex Tabarrok on Private Cities. We can learn a lot from one another.

So this week, choose from one of the prompts below the fold, and post your reply (250 words or less, please!) in the comments. We'll highlight some ...


January 27, 2015, 10:04 pm, 1411123

In advance of the final report by the congressionally established Military Compensation and Retirement Modernization Commission (MCRMC) on Thursday, the Center for a New American Security (CNAS) has released an important new report ...


January 27, 2015, 9:03 pm, 1411077
I don't expect much to change in the FOMC statement. I expect "patient" to remain:

"Based on its current assessment, the Committee judges that it can be patient in beginning to normalize the stance of monetary policy."

And this sentence will probably be dropped (it seemed like a one ...


January 27, 2015, 8:05 pm, 1411073

He is an economist, taught last year at UT Austin, and is now the new finance minister of Greece.  You can find him here on scholar.google.com.  And here is his 2011 proposal for overcoming the euro crisis, another version of that here (pdf).  Here ...


January 27, 2015, 8:04 pm, 1411072
(Don Boudreaux)

Here’s a video of a superb appearance by Milton Friedman on Icelandic television in 1984.


January 27, 2015, 7:03 pm, 1411009
From the BLS: Regional and State Employment and Unemployment Summary

Regional and state unemployment rates were generally lower in December. Forty-two states and the District of Columbia had unemployment rate decreases from November, four states had increases, and four states had no change, the U.S. Bureau of Labor Statistics ...


January 27, 2015, 6:44 pm, 1411008
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January 27, 2015, 6:44 pm, 1411007
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January 27, 2015, 6:44 pm, 1411006
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January 27, 2015, 6:44 pm, 1411005

Quantitative easing? Bah humbug!

TIRED of lightweights bickering over the financial crisis and its aftermath? Of economic upheaval becoming merely fodder for intellectually dishonest political campaigns? Wonder what biggest thinkers might have to say?

Our efforts to consult the giants of economist has ...


January 27, 2015, 6:34 pm, 1411004
Teaser:

During ...


January 27, 2015, 6:04 pm, 1411000


January 27, 2015, 6:04 pm, 1410999

Over at Business Insider,  James Rosenbush writes about the need for startups (a favorite topic of mine):

The private sector economy has a life blood, and it is startups. New businesses are started by inventive entrepreneurs out of economic necessity or because their ...


January 27, 2015, 6:04 pm, 1410998


January 27, 2015, 6:04 pm, 1410997

Editor’s Note: The following is Desmond Lachman’s response to the New York Times Room for Debate question: Can Greece’s new leftist government lift the country out of its economic wreckage or, by resisting its creditors, will it only make things worse?

In the depth of an economic depression, it is perfectly ...


January 27, 2015, 5:33 pm, 1410995
US Special Forces in Ukraine?

In response to US Special Forces in Mariupol? I received an interesting email from "Dan" a 23-year Army veteran with four years in special services.

Dan writes ...

I was a soldier in the US Army for 23 years including ...


January 27, 2015, 5:33 pm, 1410994
I have been in NYC since Sunday night. On Sunday night, I had the opportunity to sit snugly with some teenagers in the Economy Plus section of a United Flight. I worked for several hours and then watched Think Like a Man. Kevin Hart packs a punch. When ...


January 27, 2015, 5:03 pm, 1410931

For this week's tax map, we're continuing our series on pass-through businesses. For the first map of the series, check out our map from last week

Sole proprietorships, S corporations, limited liability companies (LLCs), and partnerships are also known as pass-through businesses. These entities are called pass-throughs, because the ...


January 27, 2015, 5:03 pm, 1410930

How transitory is the inflation impact of plunging oil prices?

The answer to that question could hold the key to whether the Federal Reserve raises interest rates in midyear, as many economists still expect, or waits until September or later, just to make sure inflation is rising toward the ...


January 27, 2015, 5:03 pm, 1410929
The Federal Reserve releases its policy statement at 2 p.m. ET on Wednesday. Getty Images

The Federal Reserve’s policy meeting Tuesday and Wednesday is likely to yield ...


January 27, 2015, 5:03 pm, 1410928
This morning, S&P reported that the National index increased 0.8% in October seasonally adjusted. However, it appears the seasonal adjustment has been distorted by the high level of distressed sales in recent years. Trulia's Jed Kolko wrote in August: "Let’s Improve, Not Ignore, Seasonal Adjustment of ...


January 27, 2015, 4:44 pm, 1410927

This column discusses and evaluates the new guidelines issued by the European Commission regarding the Stability and Growth Pact. These do not change the existing rules, but work to improve transparency, encourage fiscal discipline, and underline that fiscal adjustments should vary based on the circumstances a country finds itself to ...


January 27, 2015, 4:44 pm, 1410926
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January 27, 2015, 4:04 pm, 1410923

The most preposterous thing about a carbon tax, which California is in the process of implementing under the guise of a cap-and-trade program and which some other states are now considering, is the pretense that it will curb carbon emissions.

This notion — that states can save the planet from getting ...


January 27, 2015, 4:04 pm, 1410922

A new post by Brookings’s Melissa  Kearney, Brad Hershbein and David Boddy points out that almost 30% of workers in the US need a license to do their job. Occupational licensing has increased quite a ...


January 27, 2015, 2:44 pm, 1410855
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January 27, 2015, 2:34 pm, 1410854
Teaser:

A ...


January 27, 2015, 2:05 pm, 1410853

January 27, 2015, 2:05 pm, 1410852

American Sniper is one of the best anti-war movies I have seen, ever.  But it shows the sniper-assassin, and his killing, to be sexy, and to be regarded as sexy by women, while the rest of war is dull and stupid.  (Even the two enemy snipers are quite attractive and ...


January 27, 2015, 2:04 pm, 1410851
(January 27, 2015 03:32 PM, by David Henderson) Against Collectivism In the last year I have made our sister legal blog, Library of Law and Liberty, part of my newsfeed. I read most of their posts and learn from many of them. Today, blogger and George Mason University... (0 COMMENTS)


January 27, 2015, 1:33 pm, 1410848
The last two weeks have been full of monetary news with the Swiss Franc peg, and the ECB's announcement of Quantitative Easing (QE). A few thoughts.

As you have ...


January 27, 2015, 1:33 pm, 1410847
The casualties continue to pile up in the wake of the the Swiss National Bank dropping its peg to the euro.

(See Rabbit Hole Intervention Fails: Wild Moves in Swiss Franc as Switzerland Abandons Euro Peg; Morals of the Story).

The first moral of the ...


January 27, 2015, 1:33 pm, 1410846
Why did employment growby about 3 millionin 2014? Here is the answer from a new paper:

We measure the effect of unemployment benefit duration on employment. We exploit the variation induced by the decision of Congress in December 2013 not to reauthorize the ...


January 27, 2015, 1:03 pm, 1410785
Salt is unloaded at the Scio Township, Mich., maintenance yard in September. The rewards for surviving last year’s punishing winter were tight supplies of road salt and some drastic ...


January 27, 2015, 1:03 pm, 1410784
Cleveland saw the smallest annual increase in home prices, 0.6% from November a year ago. Getty Images

Home prices in 20 major cities increased 4.3%  in year ended ...


January 27, 2015, 1:03 pm, 1410783
The national average price of gasoline is a half-cent higher today than it was yesterday, according to auto club AAA. That is the first rise in gas prices since ...


January 27, 2015, 1:03 pm, 1410782
Illinois and Rhode Island saw the biggest declines in December unemployment from last year. Getty Images

The jobless rate fell in all four regions of the country ...


January 27, 2015, 1:03 pm, 1410781
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January 27, 2015, 1:03 pm, 1410780
Earlier: New Home Sales at 481,000 Annual Rate in December, Highest December since 2007

The new home sales for December were at 481 thousand on a seasonally adjusted annual rate basis (SAAR). This was the highest level of sales in over 6 years (best December since 2007).


January 27, 2015, 12:44 pm, 1410779
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January 27, 2015, 12:44 pm, 1410778
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January 27, 2015, 12:44 pm, 1410777
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January 27, 2015, 12:04 pm, 1410773
(January 27, 2015 10:44 AM, by Scott Sumner) Back in 2000, Robin Hanson wrote a paper entitled "Shall We Vote on Values, But Bet on Beliefs?", which offered a way forward for economics in the 21st century. Unfortunately his ideas were ignored (and even ridiculed) and today we... (1 COMMENTS)


January 27, 2015, 12:04 pm, 1410772
(Don Boudreaux)

One of the most frequently heard arguments in support of the so-called “war on drugs” is that a society whose government doesn’t actively discourage the use of many or most intoxicating and debilitating substances will inevitably become coarse (perhaps even downright uncivilized) and filled with all manner of ...


January 27, 2015, 12:04 pm, 1410771

Net neutrality sounds good, but it means different things to different people, making it easy for special interests to manipulate it for narrow political ends.

One definition of net neutrality is a user’s freedom to connect to any Internet content, application or service. This is uncontroversial, and Internet providers already agree ...


January 27, 2015, 12:04 pm, 1410769

Barely a year ago, most foreign policy pundits would likely have agreed on one simple prediction: the election of Narendra Modi as Indian prime minister would set back relations with the United States, and by extension with the West more broadly.

Instead, the opposite has happened. Yesterday President Barack Obama shattered ...


January 27, 2015, 12:04 pm, 1410770

The new CBO budget projection predicts annual deficits will continue to shrink the next few years before rising again in 2018, from 2.5%  of GDP in 2017 to 4.0% in 2025. Two reasons: Higher entitlement spending (from 13.0% of GDP in 2017 to 14.2% ...


January 27, 2015, 11:03 am, 1410701

The Congressional Budget Office predicts the government’s deficits will shrink in 2015 and again in 2016. As a share of the economy, it will fall to 2.5% and remain there through 2017 before beginning to rise again with the aging of the population.

These small deficits may seem surprising given ...


January 27, 2015, 11:03 am, 1410702
Crews work on D.R. Horton Inc. homes near Dallas on Monday. Kris Hudson/The Wall Street Journal

D.R. Horton Inc.’s latest quarterly results are the strongest signal yet ...


January 27, 2015, 11:03 am, 1410700
Allan Landon, Bank of Hawaii CEO, has been nominated for an open seat on the Federal Reserve’s Board Associated Press

Allan Landon, President Barack Obama‘s nominee ...


January 27, 2015, 11:03 am, 1410703
With a blizzard on the way, New York City is shrouded in a light snow on Monday. New York, and much of the Northeast, is bracing for a major ...


January 27, 2015, 11:03 am, 1410695
The national average price of gasoline is a half-cent higher today than it was yesterday, according to auto club AAA. That is the first rise in gas prices since ...


January 27, 2015, 11:03 am, 1410699

The Wall Street Journal’s Daily Report on Global Central Banks for Tuesday, January 27, 2015
Sign up for the newsletter: http://on.wsj.com/grandcentralsignup

Highlights


Hilsenrath’s Take: Bad Weather Could Complicate an Already Tough Fed Decision in March


January 27, 2015, 11:03 am, 1410697
Salt is unloaded at the Scio Township, Mich., maintenance yard in September. The rewards for surviving last year’s punishing winter were tight supplies of road salt and some drastic ...


January 27, 2015, 11:03 am, 1410696
Cleveland saw the smallest annual increase in home prices, 0.6% from November a year ago. Getty Images

Home prices in 20 major cities increased 4.3%  in year ended ...


January 27, 2015, 11:03 am, 1410698
Occupy Wall Street protestors in 2011 focused on New York City. State-level tax data shows the gap between the wealthiest 1% and everyone else was widening in all 50 ...


January 27, 2015, 11:03 am, 1410694

I have a new column:

Taxing the Wealthy Won't Hurt Economic Growth: I have no idea whether or not Mitt Romney will run for president, and if he does, if he will get the nomination. But many of the issues he ran on when he was a candidate in ...


January 27, 2015, 11:03 am, 1410693
S&P/Case-Shiller released the monthly Home Price Indices for November ("November" is a 3 month average of September, October and November prices).

This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the monthly National index.

Note: Case-Shiller reports Not ...


January 27, 2015, 11:03 am, 1410692
The Census Bureau reports New Home Sales in December were at a seasonally adjusted annual rate (SAAR) of 481 thousand.

October sales were revised up from 445 thousand to462 thousand, and November sales were revised down from 438 thousand to 431 thousand.

"Sales of new single-family houses ...


January 27, 2015, 10:44 am, 1410691

With the large Syriza victory in Greece, thoughts turn to forthcoming debt restructuring talks. This column argues that Greece is unlikely to get a large restructuring. Using a Rubinstein bargain approach to generate a back-of-the-envelope estimate, Greece would get some breathing room but not much. Rather than running a structural ...


January 27, 2015, 10:44 am, 1410690
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January 27, 2015, 10:34 am, 1410689

I try not to watch politics programmes on TV. Andrew Neil's interview with Natalie Bennett about a basic income reminds me why.

I'm appalled by Natalie's inability to answer his first question: how to pay for it? The Citizens Income Trust has set out


January 27, 2015, 10:04 am, 1410681

The education policy world is buzzing. Universal pre-k for all 4 year olds. Free community college to anyone who wants to attend. Major changes to the No Child Left Behind Act. National School Choice Week.

Attention is warranted: education is a key to economic mobility in America. An additional year of ...


January 27, 2015, 9:33 am, 1410678

NYC Mayor:

“The furious hoarfrost bearing down upon us knows neither mercy nor reason, and all within the five boroughs will perish, cowering in their brittle dwellings ... This shall be a tempest the likes of which has never been glimpsed by man or beast. Clutch your babes close to your ...


January 27, 2015, 9:33 am, 1410677

Sad:

Barbie and other traditional toys are having a much tougher time supporting their elderly parent Mattel, a toymaker significantly weakened by stiff competition from small upstarts and by digital distractions aimed at children.

On Monday, the ...


January 27, 2015, 9:33 am, 1410676

January 27, 2015, 9:03 am, 1410614

The Wall Street Journal’s Daily Report on Global Central Banks for Tuesday, January 27, 2015
Sign up for the newsletter: http://on.wsj.com/grandcentralsignup

Highlights


Hilsenrath’s Take: Bad Weather Could Complicate an Already Tough Fed Decision in March


January 27, 2015, 9:03 am, 1410613
Occupy Wall Street protestors in 2011 focused on New York City. State-level tax data shows the gap between the wealthiest 1% and everyone else was widening in all 50 ...


January 27, 2015, 8:44 am, 1410612
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January 27, 2015, 8:44 am, 1410610
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January 27, 2015, 8:44 am, 1410611
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January 27, 2015, 8:44 am, 1410609

Can a company really melt? Putting aside a business with a perishable product or inventory, does management really wake up one ...


January 27, 2015, 8:35 am, 1410608
Estimates of US GDP growth for 2014’s fourth quarter have been rising in recent months, but the current outlook still anticipates a substantial slowdown from Q3’s strong advance. The economy is projected to increase 3.6% in Q4 (real seasonally adjusted rate), based on The Capital Spectator’s new median point forecast ...


January 27, 2015, 8:05 am, 1410605

In my EconTalk with Russ Roberts on proprietary cities I only mentioned company towns in passing. Even the great Milton Friedman got company towns wrong, however, so it’s worthwhile spending a little time to dispel some myths.

Take company stores. Why did mining companies often own the town store? The standard answer: to squeeze every ...


January 27, 2015, 8:04 am, 1410604
(Don Boudreaux)

… is from page 171 of David Henderson’s excellent 2002 book, The Joy of Freedom:

Markets teach or encourage at least three virtues: tolerance, honesty, and compassion.


January 27, 2015, 7:33 am, 1410602

Make your plans now:

It goes right through the middle of the country too . . . almost everyone in the lower 48 is within a day's drive of seeing it. Cities in the path of the totality include Salem, OR, Jackson, WY, Lincoln, NE, St. Louis, ...


January 27, 2015, 7:33 am, 1410600

Interesting look at recent work by prominent historians on the role of climate in history.

For the most part, these five senior historians use climate change to discuss economic and political history. Unexpected climate shifts, or brief climate shocks, brought crop failure, hunger, unrest—these arguments appear time ...


January 27, 2015, 7:33 am, 1410601

January 27, 2015, 7:33 am, 1410599

Seems like a useful set of recommendations.


January 27, 2015, 7:33 am, 1410598

The long run--fingers crossed--could be very, very good.


January 27, 2015, 6:44 am, 1410537
Stark partisan differences in the importance attached to making further deficit reductions, combined with the new deficit estimates, could spell more tension in the annual spending debate in Washington.


January 27, 2015, 6:34 am, 1410536
● Doubts grow about mid-year rate hike, but Fed won’t express any | MarketWatch ● U.K. GDP Growth Moderates In Q4 | RTT ● Greece debt repayment in full is ‘unrealistic’, says Syriza | BBC ● Market reaction muted after S&P drops Russia to ‘junk’ | Reuters ● China 2014 ...


January 27, 2015, 5:03 am, 1410492

From our perspective, the most important and useful part of the Efficient Markets Hypothesis (EMH) is its assumption that asset prices change quickly to reflect the impact of new information upon the future expectations of investors.

So what does the ability of investors to ...


January 27, 2015, 5:03 am, 1410491

January 27, 2015, 5:03 am, 1410490

Daniel Little:


Figure: Althusser's conception of the CMP (RP Resch, Althusser and the Renewal of Marxist Social Theory)

The mode of production as society's structure: Sociologists study social structureand the effects that structures ...


January 27, 2015, 4:44 am, 1410489
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January 27, 2015, 2:44 am, 1410446
David Wessel: CBO is growing steadily gloomier about the U.S. economy's capacity to grow. If CBO is right, that means it would be harder to bring down the historically high ratio of government debt to GDP and that living standards in the U.S. will improve more slowly.


January 27, 2015, 2:05 am, 1410445

Table 1 shows that adding estimates from the literature suggests that economists have already explained 177% of the rise in average BMI.

That is from this new NBER paper, by Courtemanche, Pinkston, Ruhm, and Wehby, which seems to be one of the most careful studies to date.  They do ...


January 27, 2015, 2:04 am, 1410444
Event Description

International trade and the US economy are top issues in the 114th Congress. We welcome you to join us at AEI as Senate Finance Committee Chairman Orrin Hatch (R-UT) outlines his vision for how America can succeed in today’s global economy. Sen. Hatch will speak to his longstanding efforts ...


January 27, 2015, 1:03 am, 1410397
Crews work on D.R. Horton Inc. homes near Dallas on Monday. Kris Hudson/The Wall Street Journal

D.R. Horton Inc.’s latest quarterly results are the strongest signal yet ...


January 27, 2015, 1:03 am, 1410395

Allan Landon, President Barack Obama‘s nominee for an open seat on the Federal Reserve’s Board, has personal assets worth between $9.7 million and $41 million, according to financial disclosure forms filed with the U.S. Office of Government Ethics.

Mr. Landon, a partner in Community BanCapital, a private investment ...


January 27, 2015, 1:03 am, 1410396

The Congressional Budget Office predicts the government’s deficits will shrink in 2015 and again in 2016. As a share of the economy, it will fall to 2.5% and remain there through 2017 before beginning to rise again with the aging of the population.

These small deficits may seem surprising given ...


January 27, 2015, 12:04 am, 1410392
(January 27, 2015 12:32 AM, by Bryan Caplan) When you're a normal member of your society, the appeal of collectivism is easy to understand. Most people believe what you believe and enjoy what you enjoy. So wouldn't it be great if society as a whole continuously celebrated your... (0 COMMENTS)


January 26, 2015, 11:33 pm, 1410389
Don't worry taxi drivers, this is only a test: Self-driving cars to hit German Autobahn.

A section of the A9 Autobahn in Bavaria will be converted into a test route for self-driving cars, Transport Minister Alexander Dobrindt said on Monday.

"We will set up a test ...


January 26, 2015, 11:23 pm, 1410388

What do we ‘know’ about investing — but can’t prove with stats?

msantoli:

The statistical revolutions that have overtaken sports, business and markets have bred suspicion of any observation or assertion not backed up by hard numbers.

This is a good thing in most respects. Yet experts who study these ...


January 26, 2015, 10:44 pm, 1410359
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January 26, 2015, 10:34 pm, 1410358
Teaser:

As ...


January 26, 2015, 10:04 pm, 1410356
CBO Budget and Economic Outlook: 2015 to 2025 Document link for Robert’s post. Lots of numbers here, including a new Jan 2015 Baseline for Social Security Just started poking at the numbers but it seems that CBO has revised projected revenue for SocSec down going forward. Not by a lot ...


January 26, 2015, 10:04 pm, 1410355

Do they talk this way about Iranian President Hassan Rouhani?

After learning that Israeli Prime Minister Benjamin Netanyahu had accepted an invitation to address a joint session of Congress about the need for new sanctions to stop ...


January 26, 2015, 10:04 pm, 1410354

Key Points

Studies indicate that low-income parents participating in the District of Columbia’s private-school choice program prioritize—at least initially—the safety of schools over schools’ academic quality as they transition from public schools. Furthermore, when evaluating their child’s academic progress, parents do not view standardized test scores as a key metric of ...


January 26, 2015, 10:04 pm, 1410353

In his 1944 book “Bureaucracy,” legendary economist Ludwig Von Mises explained the important and supreme role of the ruthless consumer in the market economy (emphasis added):

The real bosses, in the capitalist system of market economy, ...


January 26, 2015, 9:33 pm, 1410352
Here's a new map of major military operations in Ukraine.

I say "new" but the caption indicates it is a day old. An estimated 7,000 to 8,000 Ukrainian troops are about to be encircled.

Major Military Operations - January 25


January 26, 2015, 9:33 pm, 1410351

In his 1944 book “Bureaucracy,” legendary economist Ludwig Von Mises explained the important and supreme role of the ruthless consumer in the market economy (emphasis added):

The real bosses, in the capitalist system of market economy, are the consumers. They, by their buying and by their abstention from buying, ...


January 26, 2015, 9:03 pm, 1410328
I was looking at the outer Los Angeles and Long Beach harbor today, and I realized I've never seen so many loaded freighters queued up to unload at the port. The West Coast port slowdown is getting serious.

The Long Beach Press Telegram had an editorial today:


January 26, 2015, 8:44 pm, 1410327
David Wessel: CBO is growing steadily gloomier about the U.S. economy's capacity to grow. If CBO is right, that means it would be harder to bring down the historically high ratio of government debt to GDP and that living standards in the U.S. will improve more slowly.


January 26, 2015, 8:44 pm, 1410326
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January 26, 2015, 8:44 pm, 1410325

THIS week: The implications of the Greek election and Davos deconstructed


January 26, 2015, 8:04 pm, 1410322
(January 26, 2015 07:52 PM, by David Henderson) A lesson I learned early in life On Facebook yesterday, an economist friend wrote that, in criticizing work by Thomas Piketty, he was claiming that Piketty is arrogant. He asked me (and others) if I thought that it was a... (1 COMMENTS)


January 26, 2015, 8:04 pm, 1410321


January 26, 2015, 8:04 pm, 1410320
The CBO lowered its forecast of the cost of the Affordable Care Act by 20% Here is the CBO report (pdf warning) I clip and past a dramatic graph They also estimate that it has caused 12 million more people to have insurance. This is the net increase subtracting cancelled ...


January 26, 2015, 7:33 pm, 1410319

Here's a question for you: Suppose there is a permanent increase in monopoly power across the economy (either firms having more monopoly power in output markets, or unions having more monopoly power in labour markets). Would that permanent increase in monopoly power cause a permanent increase in the inflation rate?

Most ...


January 26, 2015, 7:23 pm, 1410318
Free market economists are major critics of government intervention in markets. Only if it is fundamentally necessary should governments step in ( if there aresubstantial third party costs and if the free market is failing to allocate public goods are good examples) and even then, the use of effluent charges ...


January 26, 2015, 7:03 pm, 1410276

Allan Landon, President Barack Obama‘s nominee for an open seat on the Federal Reserve’s Board, has personal assets worth between $9.7 million and $41 million, according to financial disclosure forms filed with the U.S. Office of Government Ethics.

Mr. Landon, a partner in Community BanCapital, a private investment ...


January 26, 2015, 7:03 pm, 1410275

Nick Rowe:

Does monopoly power cause inflation? (1968 and all that): Here's a question for you: Suppose there is a permanent increase in monopoly power across the economy (either firms having more monopoly power in output markets, or unions having more monopoly power in labour markets). Would that permanent ...


January 26, 2015, 7:03 pm, 1410274
Economist Tom Lawler sent me the updated table below of short sales, foreclosures and cash buyers for a few selected cities in December.

On distressed: Total "distressed" share is down in almost all of these markets, mostly due to a decline in short sales.

Short sales are ...


January 26, 2015, 6:44 pm, 1410273
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January 26, 2015, 6:34 pm, 1410272

The head of Blackberry thinks he’s found the solution to his company’s problems, get the government to force companies to make apps for Blackberry phones:

At this point, BlackBerry and Windows Phone fans are probably used to ...


January 26, 2015, 6:34 pm, 1410271
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January 26, 2015, 6:04 pm, 1410268

The Congressional Budget Office just released its 10-year budget and economic forecast. Let me boil it down for you: These are the good times. Enjoy them because things are unlikely to get much better. In fact, they are likely to get ...


January 26, 2015, 6:04 pm, 1410267

POLITICO reported Monday that House Democratic Minority Leader Nancy Pelosi faces “unrest” within her party’s ranks as House Democrats head to Philadelphia for their policy retreat this week. House Democrats may be making known their opinion of Pelosi, but the rest of the ...


January 26, 2015, 6:04 pm, 1410266

In a new NBER working paper, Marcus Hagedorn of the University of the University of Oslo, Iourii Manovskii of Stockholm University and Kurt Mitman of the University of Pennsylvania – Tea Party extremists to a man, I am sure – conclude that ...


January 26, 2015, 5:23 pm, 1410263
Here is a great idea!CluedUp is a new solution for students really keen to improve their contextual knowledge in ASeconomicsTo subscribe to the daily email click here http://eepurl.com/bccNXrCheck out the blog: www.cluedup2015.wordpress.comI'll be following Clued Up carefully in the coming weeks.


January 26, 2015, 5:03 pm, 1410201

The Congressional Budget Office (CBO) has released its 2015 to 2025 Budget and Economic Outlook. In this yearly publication, the CBO examines current laws (taxes and spending) and projects the outlook for the federal government’s budget for the next 10 years.

One of the topline projections the CBO makes ...


January 26, 2015, 5:03 pm, 1410200

MONDAY

Bank of Israel releases a policy statement

TUESDAY

National Bank of Hungary releases a policy statement Federal Reserve begins a two-day policy meeting in Washington

WEDNESDAY

Central Bank of Malaysia releases a policy statement Bank of Thailand releases a policy statement BOE’s Carney speaks in Dublin at 1850 GMT Federal Reserve releases a policy statement at 2 p.m. ...


January 26, 2015, 5:03 pm, 1410199

Last year, the federal government’s deficit was the smallest since 2007. Doesn’t $3 trillion in revenue and $3.5 trillion in spending represent a government that’s out of control? Isn’t the deficit only okay because the Federal Reserve has pinned interest rates so low? What will happen when rates go back to ...


January 26, 2015, 5:03 pm, 1410196

The Congressional Budget Office predicts the government’s deficits will shrink in 2015 and again in 2016. As a share of the economy, it will fall to 2.5% and remain there through 2017 before beginning to rise again with the aging of the population.

These small deficits may seem surprising given ...


January 26, 2015, 5:03 pm, 1410198
With a blizzard on the way, New York City is shrouded in a light snow on Monday. New York, and much of the Northeast, is bracing for a major ...


January 26, 2015, 5:03 pm, 1410197
Crews work on D.R. Horton Inc. homes near Dallas on Monday. Kris Hudson/The Wall Street Journal

D.R. Horton Inc.’s latest quarterly results are the strongest signal yet ...


January 26, 2015, 4:44 pm, 1410195
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January 26, 2015, 4:44 pm, 1410193
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January 26, 2015, 4:44 pm, 1410194
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January 26, 2015, 4:05 pm, 1410188

“How can the Spanish or Italian prime minister tell voters that Greece has a lower interest burden than we have, but we still need to give them debt forgiveness?” said Mr Darvas.

That is from Ferdinando Giugliano at the FT, who is referring to the possibility that the Greek ...


January 26, 2015, 4:04 pm, 1410187
(Don Boudreaux)

Kevin Williamson reflects on the meeting of like-minds at Davos.  (HT Lyle Albaugh)  A slice:

Progressives say that they want inclusive social decision-making, but the most radically inclusive process we have for social decision-making is the thing that they generally distrust and often hate: capitalism — or, as ...


January 26, 2015, 4:04 pm, 1410185

School choice is a promising tool for education reform, allowing families to determine which school is best for their child and their child’s individual needs. To kick off National School Choice Week, here is a preview of AEI work on the issue, as well as an upcoming event:


January 26, 2015, 4:04 pm, 1410186

When the next big economic disaster hits, Washington will almost certainly choose to do something: cut taxes, increase spending, lower interest rates. There is another option, of course: do nothing. No fiscal or monetary stimulus. Let the fire burn the rot of excess from the system. From the ashes, goes ...


January 26, 2015, 4:04 pm, 1410184

The modern Democratic message seems to be that all those economic gains in the 1980s and 1990s that (easily) led to two-terms each for Ronald Reagan and Bill Clinton were illusory. Didn’t happen, at least not for middle-class America.


January 26, 2015, 4:04 pm, 1410183

Americans, we are so easy. A drop in gasoline prices and the folks in Washington start looking better and better. Particularly the president. Gasoline prices are down by a buck since last summer as global oil prices have collapsed. Also since last summer, President Obama’s approval ratings have surged.


January 26, 2015, 3:33 pm, 1410179
When black markets in currencies develop, you can be 100% sure the official exchange rate is overinflated.

In Venezuela, the fixed rate of exchange is 6.3 bolivars to the dollar, the floating rate of exchange is 50 bolivars to the dollar, and the black market rate is 184 ...


January 26, 2015, 3:33 pm, 1410178
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