Economics Roundtable

May 2014 Payroll Employment

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

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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 .


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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?


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EconModel

The Economics Roundtable is sponsored by EconModel.

The Classic Economic Models cover micro, macro, and financial markets.


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TaxVox

Tax Policy Center:  Urban Institute and Brookings Institution


July 23, 2014, 6:36 pm, 1304217

Has President Obama’s tax policy reduced income inequality? It depends on what you are comparing it to.

White House Council of Economic Advisors chief Jason Furman claims that President Obama’s tax policies have sharply reduced inequality. Today’s Washington Post Wonkblog featured some new tables from the Tax Policy Center ...


July 23, 2014, 4:35 pm, 1304138

Did banks help a hedge fund avoid $6.8 billion in US taxes? Yes, according to the Senate Homeland Security and Government Affairs panel’s Permanent Subcommittee on Investigations. Its report, released in advance of this morning’s hearing, argues that “basket option structures” were designed to conceal two things: the ...


July 23, 2014, 4:35 pm, 1304139

Another big inversion deal heads to closing. Pharmaceutical giant AbbVie agreed to purchase UK drugmaker Shire, making it the largest US company so far to move its address overseas for lower taxes. The deal, now estimated to be worth about $55 billion, will likely close despite ...


July 23, 2014, 4:35 pm, 1304137

In recent months, several governors have complained about the April, 2014, surprise in state tax revenues. They say they were shocked when personal income tax payments fell far below expectations. They shouldn’t have been.

What happened? In part, in an effort to beat an upcoming increase in capital gains taxes, ...


July 23, 2014, 4:35 pm, 1304136

Today, I testified before the U.S. Senate Permanent Subcommittee on Investigations (the “Subcommittee”) on the abuse of structured financial products by hedge funds, in particular by the Renaissance funds. This is what I told the Subcommittee:

Almost a century ago, Congress reduced the tax rate for long-term capital gains. Then, ...


July 23, 2014, 4:35 pm, 1304134

Two appeals courts deliver opposing rulings on Affordable Care Act tax subsidies. The DC Circuit Court ruled yesterday that the tax credits can only go to residents in states that run their own  health exchanges. In Richmond, VA, the 4th Circuit Court said the ACA language isn’t clear, so the ...


July 23, 2014, 4:35 pm, 1304135

Unlike the rest of us, many high-income, influential people and organizations have close to a free hand when it comes to their taxes. Already underfunded and understaffed, the IRS seems incapable of stopping many aggressive or even abusive interpretations of the tax laws, often by hedge funds or politically-motivated tax-exempt ...


July 18, 2014, 8:35 am, 1302981

Australia repeals its two-year-old carbon tax. It’s been a contentious issue for seven years. Australia is one of the biggest producers of carbon emissions per capita. Its government is committed to reducing emissions to 5 percent below year 2000 levels  by 2020. A carbon ...


July 17, 2014, 6:36 pm, 1302689

Congress and corporate America are in a dangerous and mutually destructive race: The more lawmakers threaten to ban the practice of inversions—where U.S. based multinationals merge with foreign firms to lower their tax bill– the more firms race to complete the deals while they can. The more deals, the more ...


July 17, 2014, 8:35 am, 1302308

Treasury calls for quick Congressional action, because Congress is known to be… quick. Secretary Jack Lew asked top congressional tax writers to act now to end corporate inversions, and make such legislation retroactive to May of this year, giving Congress time to