Economics Roundtable

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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- Recent Entries


October 22, 2014, 10:44 pm, 1355911
The long awaited credit risk retention rules for securitization are out. The big question--whether the qualified residential mortgage or QRM exemption would be narrower than the CFPB's qualified mortgage or QM safe harbor to the Ability to Repay requirement for mortgages is no. QRM=QM. The short ...


October 22, 2014, 10:05 pm, 1355909

According to Guy McPherson, Professor Emeritus of Natural Resources, Ecology, etc., at the University of Arizona, has declared that (presumably man-made) climate change is “irreversible” and that, basically, we’re all doomed.

As I’ve noted before, anyone who actually values human liberty and ...


October 22, 2014, 9:03 pm, 1355876

Integration, cointegration and the evaluation of time series data for public policy analysis. As my first economics teacher said, “ya gotta be careful”.

Bruce Thompson at Urban Milwaukee’s Data Wonk writes:

…the data shows Gov. Walker has had little impact, positive or negative, on how the state grows jobs.

Dr. Thompson ...


October 22, 2014, 9:03 pm, 1355875
From Kathleen Madigan at the WSJ: Why Rising Rents Haven’t Pumped Up Inflation

For the 12 months ended in September, [owners’ equivalent rent] OER is up 2.7%, up from 2.2% a year ago. (Actual rent paid by tenants is up a faster 3.3%.)

OER is the big ...


October 22, 2014, 7:33 pm, 1355871


October 22, 2014, 7:03 pm, 1355815

Federal Reserve officials have said the latest round of soft eurozone economic data is not enough to worry them about the U.S. outlook – or revise their fairly optimistic forecasts in the months ahead.

“It’s not really a surprise that growth in Europe has been underperforming for some time,” Boston Fed ...


October 22, 2014, 7:03 pm, 1355814

Last week’s financial market volatility could cost the U.S. around 8,000 jobs, according to a rough estimate published Tuesday by Renaissance Macro Research.

Neil Dutta, the firm’s head of economics, calculated the figure ...


October 22, 2014, 7:03 pm, 1355816
The Flatirons rock formations in Boulder, Colorado. The Centennial State became the latest to record a jobless rate below 5%. Sarah Portlock/The Wall Street Journal

The unemployment ...


October 22, 2014, 7:03 pm, 1355812
The European Central Bank hopes this year’s tests will appear more credible than those conducted in 2010 and 2011. AP

It’s not the credit rating firm’s “baseline” ...


October 22, 2014, 7:03 pm, 1355818
New York University has faced criticism for its high student-debt loads.

Soft entry-level housing demand has fanned fears that rising student loan burdens may be crimping home purchases.

But new ...


October 22, 2014, 7:03 pm, 1355817
Florida Gov. Rick Scott, in Vero Beach, Fla., this month, has put jobs front and center. Getty Images

The campaign offices of Colorado Gov. John Hickenlooper and ...


October 22, 2014, 7:03 pm, 1355813

Many market participants believe there’s a point in a dramatic market selloff when the Federal Reserve will step in and do something to staunch the bleeding.

Call it the Fed “put.” While both men denied it, former Fed chairmen Alan Greenspan and Ben Bernanke were both thought by many to be ...


October 22, 2014, 7:03 pm, 1355807

The Wall Street Journal’s Daily Report on Global Central Banks for Wednesday, October 22, 2014:

Sign up for the newsletter.

Quote of the Day: “In 30-40 years, the Fed will admit they caused the Great Recession”—Cato Institute CEO John Allison


October 22, 2014, 7:03 pm, 1355806

Americans who receive Social Security benefits will see a modest increase in their checks next year to cover higher consumer prices.

The annual cost-of-living adjustment will amount to 1.7% for 2015,


October 22, 2014, 7:03 pm, 1355808
Japanese Vice Economy Minister Yasutoshi Nishimura Bloomberg News

The yen is likely to weaken further due to differences of monetary policies in the U.S. and Japan, but ...


October 22, 2014, 7:03 pm, 1355809
Traders work in the crude oil and natural gas options pit on the floor of the New York Mercantile Exchange. Getty Images

The recent sharp fall in ...


October 22, 2014, 7:03 pm, 1355811
An ocean front area in Miami, Florida. Getty Images

In many American cities, the landlords are increasingly Chinese.

Big institutional Chinese investors who want global real-estate portfolios typically


October 22, 2014, 7:03 pm, 1355810
A worker at a textile factory in Jiujiang, Jiangxi province. Zuma Press

China’s economy slowed down a fraction in the third quarter of the year. If you ...


October 22, 2014, 7:03 pm, 1355804

The Federal Reserve Bank of New York said Wednesday that veteran official Christine Cumming will retire next summer.

Christine Cumming, first vice president of the Federal Reserve Bank of New ...


October 22, 2014, 7:03 pm, 1355805

Roughly 10% of U.S. children were living with a grandparent in 2012, up from 7% in 1992, according to a report from the Census Bureau released Wednesday.

The increase stems partly ...


October 22, 2014, 7:03 pm, 1355802

Policy makers and economy-watchers now seem more worried about disinflation rather than accelerating inflation. That wasn’t the expectation at the start of the year. In January, economists surveyed by The Wall Street ...


October 22, 2014, 7:03 pm, 1355803
A vendor displays a souvenir with pictures of Chinese President Xi Jinping, left, and the late Chinese Chairman Mao Zedong to visitors at the underpass outside the Great ...


October 22, 2014, 7:03 pm, 1355801

Mortgage holders in the U.K. don’t appear to be losing sleep over fear that the Bank of England will increase interest rates soon, according to a survey released Thursday.

The poll by research firm YouGov PLC in association with the Council of Mortgage Lenders found 60% of ...


October 22, 2014, 6:44 pm, 1355800
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October 22, 2014, 6:05 pm, 1355798

Austrian economist Micheal Pollaro writes that with the end of QE3 coming that stock market bulls need to take a note of caution because the Austrian measure of the money supply is already falling. This is typically a sign of trouble for stock markets.

The Federal Reserve’s ...


October 22, 2014, 6:05 pm, 1355797

Venezuela loses $728MM for each 1$ the oil price drops. Assuming oil @ $104 in 2014 and $96 in 2015 Vzla’s $ deficit in 2015 will be $27.8bn

That is from Moisés Naim on Twitter.  Here is more on the same topic.


October 22, 2014, 6:04 pm, 1355796
(October 22, 2014 05:01 PM, by Alberto Mingardi) What does it mean that Amazon has "too much power"? Paul Krugman has published a vehement column on the online retailer, arguing basically that Amazon enjoys a significant "market power" vis-à-vis publishers. He refers to the feud between Amazon and... (2 COMMENTS)


October 22, 2014, 6:04 pm, 1355795
Noah Smith made a thought-provoking statement on twitter, “Sometimes I wonder what actually causes recessions.” He received a slew of responses. While one could point to many causes, including tight money and the beats of butterfly wings, I look primarily to the dynamics of productivity. Here is a graph of ...


October 22, 2014, 5:33 pm, 1355793

On the White House blog, Ann Arbor-based Zingerman’s Deli co-owner Paul Saginaw extols the virtues of raising the minimum wage, here’s an excerpt of his post titled “A Small Business Owner’s Perspective: ‘A High Road on the ...


October 22, 2014, 5:03 pm, 1355732

A wealth tax would not be good for the U.S. economy.

In his book, Capital in the 21st Century, Thomas Piketty suggests a wealth tax to fight income inequality. In a recent report, we used our Taxes and Growth model to evaluate the impact of such a tax on ...


October 22, 2014, 5:03 pm, 1355731

Michigan’s Senate approved a bill yesterday to extend the state’s film tax credit program, which was limited and reduced in 2011 and set to expire in 2017. It’s now up to the House to decide whether to proceed. From Mlive:

The bill would eliminate a ...


October 22, 2014, 5:03 pm, 1355730

Mortgage holders in the U.K. don’t appear to be losing sleep over fear that the Bank of England will increase interest rates soon, according to a survey released Thursday.

The poll by research firm YouGov PLC in association with the Council of Mortgage Lenders found 60% of ...


October 22, 2014, 5:03 pm, 1355729
With QE3 expected to end next week, by request, here is an updated timeline of QE (and Twist operations):

• November 25, 2008: Press Release: $100 Billion GSE direct obligations, $500 billion in MBS

• December 16, 2008 FOMC Statement: Evaluating benefits of purchasing longer-term Treasury ...


October 22, 2014, 4:44 pm, 1355728
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October 22, 2014, 4:44 pm, 1355727

Yves Smith has had some great coverage of the AIG bailout trail over on Naked Capitalism.  While the litigation, as Yves has characterized it, is a bit like a brawl between the ugly stepsisters, it's telling us all kinds of stuff we didn't know (or at least couldn't ...


October 22, 2014, 4:04 pm, 1355726
Is it just me, or did Joni Ernst just effectively announce that she wants to kill farm subsidies?  Of course, how effectively she announced it will depend on whether her opponent, Bruce Braley, picks up this ball and runs with it. Although maybe she’s talking about something else she thinks ...


October 22, 2014, 3:33 pm, 1355719

…. is from Alex Epstein’s forthcoming book “The Moral Case for Fossil Fuels“:

The cheap, plentiful, reliable energy we get from fossil fuels, combined with human ingenuity, gives us the ability to transform the world around us into a place that is far safer from any health hazards (man-made or ...


October 22, 2014, 3:03 pm, 1355658

Policy makers and economy-watchers now seem more worried about disinflation rather than accelerating inflation. That wasn’t the expectation at the start of the year. In January, economists surveyed by The Wall Street ...


October 22, 2014, 3:03 pm, 1355657
The Cleveland Fed released the median CPI and the trimmed-mean CPI this morning:

According to the Federal Reserve Bank of Cleveland, the median Consumer Price Index rose 0.1% (1.8% annualized rate) in September. The 16% trimmed-mean Consumer Price Index also rose 0.1% (1.8% annualized rate) during the month. The ...


October 22, 2014, 2:44 pm, 1355656
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October 22, 2014, 2:34 pm, 1355655
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October 22, 2014, 2:05 pm, 1355654

In the 1970s, Penthouse magazine had a reputation for featuring the ideas of unorthodox political thinkers and movements. That’s why in October 1976 it interviewed Murray Rothbard to ask about the rapidly-growing philosophy of libertarianism. This interview is now difficult to find, but was recently excavated from the archives at ...


October 22, 2014, 2:05 pm, 1355653

Michela Giorcelli and Petra Moser have a new paper, the abstract is this:

This paper exploits variation in the adoption of copyright laws within Italy – as a result of Napoleon’s military campaign – to examine the effects of copyrights on creativity. To measure variation in the quantity and ...


October 22, 2014, 2:04 pm, 1355652
Linda Beale announced her return to blogging after the death of her husband here.   (Dan here…Welcome back to blogging Linda.) by Linda Beale The result of taxpayers’ financial bailout of GMAC GMAC, as most of you likely know, was General Motors’ financial group.  GMAC had originated as a means ...


October 22, 2014, 1:33 pm, 1355646
Inquiring minds are tuned into the Saxo Bank's 4th Trading Debate on Volatility and Performance.

Another "Shock Drop" in Markets

Saxo Bank CIO Steen Jakobsen says Another 'Shock Drop' is Coming and it's Coming Soon

Steen takes the view that central bank policy ...


October 22, 2014, 1:33 pm, 1355647
In yet another embarrassing moment for the Obama administration, Isis Claims it has US Airdrop of Weapons.

A US airdrop of arms to besieged Kurds in Kobani appears to have missed its target and ended up in the hands of Islamic State (Isis) militants.

Video footage ...


October 22, 2014, 1:33 pm, 1355645

The economic impact of the minimum wage is one of the most studied public-policy topics I’ve run across. But sometimes these analyses have an air of unreality about them. At an AEI event earlier this year, Heidi Shierholz — then an EPI think tanker, now the US Labor ...


October 22, 2014, 1:33 pm, 1355644

MIT Technology Review’s David Talbot offers some helpful perspective on that Lockheed Martin announcement of a breakthrough in nuclear fusion. The company says it’s on track to sell a small, very powerful reactor within a decade. Not surprisingly, the piece gives room to the skeptics to ...


October 22, 2014, 1:03 pm, 1355582

Roughly 10% of U.S. children were living with a grandparent in 2012, up from 7% in 1992, according to a report from the Census Bureau released Wednesday.

The increase stems partly ...


October 22, 2014, 1:03 pm, 1355580
A vendor displays a souvenir with pictures of Chinese President Xi Jinping, left, and the late Chinese Chairman Mao Zedong to visitors at the underpass outside the Great ...


October 22, 2014, 1:03 pm, 1355581

The Federal Reserve Bank of New York said Wednesday that veteran official Christine Cumming will retire next summer.

Ms. Cumming, currently first vice president and chief operating officer at the bank, has worked there for 35 years, holding numerous positions. She worked primarily on bank operations and payments systems, as well ...


October 22, 2014, 1:03 pm, 1355579

I am not convinced that telling the kids to be good or else -- when there's a history of not doing much to enforce the request -- will work:

Will the big banks ever clean up their act?, by Mark Thoma: Federal Reserve Bank of New York President William Dudley ...


October 22, 2014, 1:03 pm, 1355577

Everything you ever wanted to know about helicopter money:

Helicopter money, by Simon Wren-Lewis, Mainly Macro: Periodically articles appear advocating, or discussing, helicopter money. Here is a simple guide to this strange sounding concept. I go in descending order of importance, covering the essential ground in points 1-7, and ...


October 22, 2014, 1:03 pm, 1355578

Chris Dillow:

Persuasion with statistics: Mark Thoma's point that apparently strong econometric results are often the product of specification mining prompts Lars Syll to remind us that eminent economists have long been wary of what econometrics can achieve.

I doubt if ...


October 22, 2014, 12:44 pm, 1355575
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October 22, 2014, 12:44 pm, 1355576
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October 22, 2014, 12:44 pm, 1355574
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October 22, 2014, 12:34 pm, 1355573
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October 22, 2014, 12:05 pm, 1355569

The notion that the Federal Reserve has been acting to manipulate stock markets has been active for decades, but rarely has that notion been openly discussed in the mainstream media. In this article by Howard Gold the Fed is praised for its “market timing” as Fed official quickly responded ...


October 22, 2014, 12:05 pm, 1355568

October 22, 2014, 12:04 pm, 1355567
(Don Boudreaux)

Paul Krugman’s recent New York Times column on Amazon’s alleged market power reads like countless pro-antitrust articles, essays, and court opinions from the mid-20th century.  Here’s the thrust:

A currently big, successful, and well-known company that admittedly has pioneered great efficiency-enhancing production or distribution procedures – procedures that have, ...


October 22, 2014, 12:04 pm, 1355566
Indeed, they are; state and local governments are closer to the people.  It’s just that the people they’re closer to probably aren’t, well … you. So, here’s a question: Why isn’t, say, Kay Hagan, who’s running against the North Carolina Senate Majority Leader, or Charlie Crist, who’s running against Florida ...


October 22, 2014, 11:33 am, 1355564

Mark Thoma:

There's a version of this in econometrics, i.e. you know the model is correct, you are just having trouble finding evidence for it. It goes as follows. You are testing a theory you came up with, but the data are uncooperative and say you are wrong. But instead of ...


October 22, 2014, 11:33 am, 1355563

Retraction Watch:

There’s a new journal in town.

Inference’s first issue includes a lengthy review of a laboratory by a tennis instructor, a set of caricatures, and an exchange of emails from 1996 that is “perhaps, less remarkable for what it says than for the fact that it took ...


October 22, 2014, 11:03 am, 1355502
With the release of the CPI report this morning, we now know the Cost of Living Adjustment (COLA), and the contribution base for 2015.

Currently CPI-W is the index that is used to calculate the Cost-Of-Living Adjustments (COLA). Here isa discussion from Social Security on the current ...


October 22, 2014, 10:44 am, 1355501
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October 22, 2014, 10:34 am, 1355500
The three-month average of the Chicago Fed National Activity Index (CFNAI) is expected to decelerate a bit to +0.03 in tomorrow’s update for September, according to The Capital Spectator’s median econometric point forecast for several econometric estimates. The projection is marginally below August’s +0.07 reading, which reflected above-average economic growth ...


October 22, 2014, 10:34 am, 1355499

Mark Thoma's point that apparently strong econometric results are often the product of specification mining prompts Lars Syll to remind us that eminent economists have long been wary of what econometrics can achieve.

I doubt if many people have ever thought ...


October 22, 2014, 9:23 am, 1355488
Reports out over the last couple of days suggest that government spending on free nursery places for 3 year olds since 1998 has not produced any valuable educational or economic outcome. The policy was introduced as part of a series of reforms introduced by Tony Blair when he came to ...


October 22, 2014, 9:03 am, 1355429

The Wall Street Journal’s Daily Report on Global Central Banks for Wednesday, October 22, 2014:

Sign up for the newsletter.

Quote of the Day: “In 30-40 years, the Fed will admit they caused the Great Recession”—Cato Institute CEO John Allison


October 22, 2014, 9:03 am, 1355428

Americans who receive Social Security benefits will see a modest increase in their checks next year to cover higher consumer prices.

The annual cost-of-living adjustment will likely amount to 1.7% for 2015,


October 22, 2014, 9:03 am, 1355426
Note: This index is a leading indicator primarily for new Commercial Real Estate (CRE) investment.

From AIA: Architecture Billings Index Shows Robust Conditions Ahead for Construction Industry

With all geographic regions and building project sectors showing positive conditions, there continues to be a heightened level of demand ...


October 22, 2014, 9:03 am, 1355427
From the BLS:

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.1 percent in September on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 1.7 percent before seasonal adjustment.
...
The index ...


October 22, 2014, 8:44 am, 1355425
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October 22, 2014, 8:44 am, 1355424
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October 22, 2014, 8:34 am, 1355423
Welcome to the big snapback… so far. The prices of risky assets have made a huge U-turn in recent days. Battered and bruised has given way to robust and rising. It may turn out to be a fleeting resurgence, but the rebound looks impressive at the moment. US real estate ...


October 22, 2014, 8:04 am, 1355421
(October 22, 2014 06:05 AM, by Scott Sumner) Here's Matt Yglesias on fiscal stimulus: What the country needs is a stimulative process that has the bureaucratic properties of monetary policy, but the heft and comprehensibility of fiscal stimulus. If we had a national sales tax like Japan does,... (0 COMMENTS)


October 22, 2014, 8:04 am, 1355420
(Don Boudreaux)

… is from page 94 of my late Nobel-laureate colleague James M. Buchanan‘s 2005 book, Why I, Too, Am Not a Conservative: The Normative Vision of Classical Liberalism:

To be free to choose implies acceptance of the results of choices made, which means, in turn, that there should be ...


October 22, 2014, 7:33 am, 1355417

22-year-old West African woman combats Ebola by "invent[ing] her own equipment".


October 22, 2014, 7:33 am, 1355415

Ira Stoll, in the New York Post, speculates on the reason for Krugman's call for antitrust action against Amazon:

It’s enough to make a cynic suspect that the Times’ panic over Amazon isn’t about online retailer’s market power or disparate treatment at all, but the fact that ...


October 22, 2014, 7:33 am, 1355416

October 22, 2014, 7:23 am, 1355413
Why can’t the UK government get its deficit down? This question has been exercising commentators recently, in the light of the latest assessment from the Office for Budget Responsibility (OBR) that George Osborn will once again miss his target for the deficit in the 2014/15 financial year. Of ...


October 22, 2014, 7:03 am, 1355350
Japanese Vice Economy Minister Yasutoshi Nishimura Bloomberg News

The yen is likely to weaken further due to differences of monetary policies in the U.S. and Japan, but ...


October 22, 2014, 7:03 am, 1355349
From the MBA: Mortgage Applications Increase in Latest MBA Weekly Survey

Mortgage applications increased 11.6 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 17, 2014. This week’s results did not include an adjustment for ...


October 22, 2014, 6:44 am, 1355348
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October 22, 2014, 6:44 am, 1355347
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October 22, 2014, 6:44 am, 1355345
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October 22, 2014, 6:44 am, 1355346
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October 22, 2014, 6:34 am, 1355344
● Existing home sales hit highest level in 2014 | USA Today Existing home sales last month were the strongest this year, but remained below year-earlier levels for the 11th straight month, the National Association of Realtors said Tuesday. ● US Q3 Real GDP Still Looks Solid | First Trust ...


October 22, 2014, 5:33 am, 1355342

I'm not sure the answer is right, but your mileage may vary.

The answer, it seems, is embedded deep in the evolutionary nature of disgust. And in the central role sex plays in the evolutionary story.


October 22, 2014, 5:03 am, 1355281
A worker at a textile factory in Jiujiang, Jiangxi province. Zuma Press

China’s economy slowed down a fraction in the third quarter of the year. If you ...


October 22, 2014, 5:03 am, 1355280
Traders work in the crude oil and natural gas options pit on the floor of the New York Mercantile Exchange. Getty Images

The recent sharp fall in ...


October 22, 2014, 5:03 am, 1355279

Since we're now outside of the anniversary period of 2013's U.S. debt ceiling crisis, the third and smallest of the major noise events of 2013, we're making the transition back to using our standard baseline model for use in forecasting and explaining changes in current day ...


October 22, 2014, 5:03 am, 1355278

October 22, 2014, 4:05 am, 1355277

There is a new paper from Andrew M. Francis and Hugo M. Mialon:

In this paper, we evaluate the association between wedding spending and marriage duration using data from a survey of over 3,000 ever-married persons in the United States. Controlling for a number of demographic and ...


October 22, 2014, 3:03 am, 1355238
An ocean front area in Miami, Florida. Getty Images

In many American cities, the landlords are increasingly Chinese.

Big institutional Chinese investors who want global real-estate portfolios typically


October 22, 2014, 2:05 am, 1355236

1. Doris Kearns, The Bully Pulpit: Theodore Roosevelt, William Howard Taft, and the Golden Age of Journalism.  This Pulitzer-Prize winning book is compulsively readable and is most valuable on how the Roosevelt and Taft administrations fit together in American history.  I wish it had more detail on economic ...


October 22, 2014, 12:44 am, 1355205

This week, Russ Roberts welcomed back University of Chicago's Luigi Zingales to talk about a recent essay in which Zingales argues that economists are subject to many of the same sorts of biases as regulators because of the incentives they face.

And now we want to hear from you. Use ...


October 22, 2014, 12:34 am, 1355204

With 100 years having passed since the start of the First World War, the view of the war among historians and the public has evolved in many ways. Historian Hunt Tooley examines the turning points in how the world sees the Great ...


October 22, 2014, 12:04 am, 1355203
(Don Boudreaux)

… is from page 35 of the transcript of Deirdre McCloskey‘s new, extensive, wide-ranging, and brilliant review of Thomas Piketty’s Capital in the Twenty-First Century; (quoted here with Deirdre’s kind permission):

It is important in thinking about the issues Piketty so energetically raises to keep straight what exactly ...


October 21, 2014, 11:33 pm, 1355202
A 30% net income decline for McDonald's is quite startling to most. I wonder why such a decline took so long.

In response to that pathetic performance, McDonald’s Vows Fresh Thinking.

McDonald’s Corp. outlined plans for what it called fundamental changes to its business as ...


October 21, 2014, 10:04 pm, 1355170
(October 22, 2014 12:07 AM, by Bryan Caplan) Criminals are poorly educated. About 68% of state inmates dropped out of high school. Many researchers study whether this effect is causal. As usual, though, I'm more interested in whether the causal effect stems from signaling. Education could reduce crime... (1 COMMENTS)


October 21, 2014, 9:33 pm, 1355168

October 21, 2014, 9:03 pm, 1355138
Here is a forecast for 2015 from the MBA: MBA Sees Originations Increasing Seven Percent in 2015

The Mortgage Bankers Association announced today that it expects to see $1.19 trillion in mortgage originations during 2015, a seven percent increase from 2014. While MBA anticipates purchase originations will increase ...


October 21, 2014, 8:44 pm, 1355137

Many central banks embrace forward guidance by announcing expected interest rate paths. But how likely it is that actual rates will be close to expected ones? This column argues that quantifying such uncertainty poses great difficulties. Precise probability statements in a world of uncertainty (not just risk) can be misleading. ...


October 21, 2014, 8:44 pm, 1355136
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October 21, 2014, 7:03 pm, 1355073
From DataQuick: Golden State Foreclosure Starts Continue to Decline

Lending institutions initiated formal foreclosure proceedings last quarter on the lowest number of California homes in more than eight years, the result of a recovering real estate market and the dwindling pool of toxic home loans made in 2006 and ...


October 21, 2014, 6:44 pm, 1355072
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October 21, 2014, 6:44 pm, 1355071
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October 21, 2014, 6:05 pm, 1355069

I’ve been critical of the Obama administration in the past, so it’s nice to find something positive to say. This article says that President Obama’s new acting head of the Justice Department’s Civil Rights Division, Vanita Gupta “supports decriminalizing cocaine, heroin, LSD, methamphetamine, ecstasy and all dangerous drugs, ...


October 21, 2014, 6:04 pm, 1355068
By way of the show Boom-Bust, we have an interview with Jim Bruce on the future of Fed Policy. (interview starts at 14:40) He does not see the Fed rate lifting off next year. He does not see easy Fed policy avoiding an economic downturn. He says Fed has been ...


October 21, 2014, 5:33 pm, 1355065

The chart above shows a most amazing economic phenomenon: Since December 2007 when the Great Recession started, Texas civilian employment has increased by 12% and by more than 1.32 million jobs, from just over 11 million jobs in December 2007 to 12.32 million in September of this year (see blue ...


October 21, 2014, 5:03 pm, 1355003

Many market participants believe there’s a point in a dramatic market selloff when the Federal Reserve will step in and do something to staunch the bleeding.

Call it the Fed “put.” While both men denied it, former Fed chairmen Alan Greenspan and Ben Bernanke were both thought by many to be ...


October 21, 2014, 5:03 pm, 1355002
The European Central Bank hopes this year’s tests will appear more credible than those conducted in 2010 and 2011. AP

It’s not the credit rating firm’s “baseline” ...


October 21, 2014, 5:03 pm, 1355001
Container traffic gives us an idea about the volume of goods being exported and imported - and possibly some hints about the trade report for September since LA area ports handle about 40% of the nation's container port traffic.

The following graphs are for inbound and outbound traffic at ...


October 21, 2014, 4:44 pm, 1355000
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October 21, 2014, 4:44 pm, 1354999
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October 21, 2014, 4:34 pm, 1354998

A new regulation will require all persons arriving in the U.S. from the nations western Africa dealing with the Ebola crisis, either directly or indirectly, to come through one of five airports:

WASHINGTON — Anyone flying to the United States from Ebola-affected countries in West Africa must enter the ...


October 21, 2014, 4:05 pm, 1354996

B.B. writes:

In “National Income and the Price Level,” Martin Bailey discussed the issues of the liquidity trap and secular stagnation.

He observed that at a zero real interest rate, it would be profitable to level the Rocky Mountains and fill in the Gulf of Mexico. The land created would ...


October 21, 2014, 3:33 pm, 1354992




The ideal tax system reflects a compromise between two conflicting goals: equity ...


October 21, 2014, 3:33 pm, 1354991

In the 1960s, my mother's monthly family allowance cheque paid for a week's groceries.

In 2011, the median Canadian two-parent family had an income of just over $90,000. At that level of net income, a family with two children receives Canada Child Tax Benefit worth $87 per ...


October 21, 2014, 3:33 pm, 1354990
Here's an interesting video from the recent James Grant Conference. The title of this year's conference is Investing Opportunistically, Separating the Beta from the Alpha.

The first five minutes are introductions and attendee notes you may wish to skip over. The opening speech was by Marc Seidner, CFA ...


October 21, 2014, 3:33 pm, 1354989

…. is from the introduction of Radley Balko’s book Rise of the Warrior Cop: The Militarization of America’s Police Forces:

How did we evolve from a country whose founding statesmen were adamant about the dangers of armed, standing government forces — a country that enshrined the Fourth Amendment in ...