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


July 29, 2014, 2:44 pm, 1307380

I name names and point fingers in the Wall Street Journal.  NML gets some blame for overplaying its hand, but the fault primarily lies with the federal courts for letting the case go forward. I understand the courts being angered by an unrepentant debtor thumbing its ...


July 29, 2014, 2:05 pm, 1307377

In a must-read post on Zero-Hedge, Tyler Durden highlights Guido Hülsmann’s neglected 2003 article “Has Fractional-Reserve Banking Really Passed the Market Test?”  Durden lauds the article and predicts that it “may prove to be the most revolutionary essay in the ...


July 29, 2014, 2:05 pm, 1307376

A young man who attended Mises University last week posted the following on Facebook:

At Cato U in San Diego. Just saying: between the two there is NO COMPARISON. Mises remains the gold standard of ideas. The intellectual conversations, the overall decency of the people, and just the welcoming attitude just ...


July 29, 2014, 2:05 pm, 1307375

These were the results:

1. People responded to first messages 44% more often.

2. “conversations went deeper”

3. Contact details were exchanged more quickly.

Furthermore:

When the photos were restored at 4PM, 2,200 people were in the middle of conversations that had started “blind”. Those conversations melted away.

That said, the people who actually used the ...


July 29, 2014, 2:04 pm, 1307374

The idea of democracy is to give the people what they want, right?

Ezra Klein points us to a great study by Ray LaRaja and Brian Schnaffer examining policy preferences by political donors (5% of the population) vs. non-donors (95%).

Here’s my rendition of the results:


July 29, 2014, 1:33 pm, 1307370

Well, there is a new policy think tank in Canada and they have just released a commentary on the minimum wage.

The Northern Policy Institute began operations over the last year (I am a member of the Research Advisory Board) with a primary mission to provide evidence based research on the ...


July 29, 2014, 1:33 pm, 1307369

Democrats rule! For the partisan left, the first sentence of “Presidents and the U.S. Economy: An Econometric Exploration” is probably plenty: “The U.S. economy has grown faster—and scored higher on many other macroeconomic metrics—when
the President of the United States is a Democrat rather than a Republican.”

Case closed. ...


July 29, 2014, 1:03 pm, 1307307

This weekend, Danielle Kurtzleben at Vox.com was puzzled by corporations shouldering what appears to be a declining portion of the federal tax burden, despite the high US corporate rate.

The source of this paradox is a peculiarity of our tax code: some corporations, called ...


July 29, 2014, 1:03 pm, 1307306

News outlets in my home state of Kentucky report that a Creationist-themed amusement park, “Ark Encounter,” is seeking approval for tax incentives. We wrote on this several years ago when the sponsoring organization, Answers in Genesis (AiG), first applied for tax incentives. Now, AiG is proposing ...


July 29, 2014, 1:03 pm, 1307305

As expected, the pace of U.S. home price gains has slowed this year. Prices rose 9.3% from a year earlier in May in 20 cities tracked by the Standard & ...


July 29, 2014, 1:03 pm, 1307304

From a CEA report written under the leadership of James Stock, released today:

…any short run gains from delay tend to be outweighed by the additional costs arising from the need to adopt a more abrupt and stringent policy later.7 An analysis of the collective results from that research, ...


July 29, 2014, 1:03 pm, 1307303
I've been expecting a slowdown in year-over-year prices as "For Sale" inventory increases, and the slowdown is here! The Case-Shiller Composite 20 index was up 9.3% year-over-year in May; the smallest year-over-year increase since January 2013.

This is still a very strong year-over-year change, but on a seasonally adjusted ...


July 29, 2014, 12:45 pm, 1307302
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July 29, 2014, 12:45 pm, 1307301
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July 29, 2014, 12:34 pm, 1307300
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July 29, 2014, 12:05 pm, 1307295

Mises Daily Tuesday by Tyler Kubik:

With the failure of central planning worldwide, many economists have turned to promoting government as an innovative and entrepreneurial institution that fosters greater efficiency and economic growth. In truth, governments fail where private entrepreneurs succeed. Governments ...


July 29, 2014, 12:04 pm, 1307294
(July 29, 2014 01:32 PM, by David Henderson) My bleg about eminent domain yesterday led to a useful discussion in the comments. Dan Klein recommended that I read Bruce Benson's article, "The Mythology of Holdout as a Justification for Eminent Domain and Public Provision of Roads." I've done... (0 COMMENTS)


July 29, 2014, 12:04 pm, 1307293
(Don Boudreaux)

Adam Ozimek draws from the recent study showing that large retailers pay their workers more, on average, than do smaller retailers a relevant lesson about minimum-wage legislation.  (HT Tyler Cowen)  A slice:

If monopsony power is an important feature of the labor market, and monopsony power should ...


July 29, 2014, 12:04 pm, 1307292
(Don Boudreaux)

Suppose that consumers throughout history have grown their own apples.  Apples were never produced for sale in markets by specialized apple growers; nor did any household that grew apples in its yard sell those apples to anyone.  All apples that were consumed were grown by the individuals or ...


July 29, 2014, 12:04 pm, 1307291

I wrote last November that the success of Abenomics in Japan would depend on raising labor’s share of income faster than inflation. Basically real wages need to rise. I would now add that real wages need to rise faster than productivity. The key is to raise effective demand with ...


July 29, 2014, 11:33 am, 1307289

I posted my first anonymous comment on Mark Trail at Comics Kingdom. I'm "John W." here.


July 29, 2014, 11:33 am, 1307288

Last week I reported on the CBO’s new projections for Social Security, which show a growing long-term deficit. Today it’s the Social Security Trustees turn, when they released their annual report on the program’s finances. And like the CBO, the Trustees see a worsening picture for ...


July 29, 2014, 11:33 am, 1307287

1. Chart of the Day – Another Energy Milestone. Through June of this year, net petroleum imports fell below 30% for the first time since 1985, reaching a 29-year low (data here). Note the amazing drop in net oil ...


July 29, 2014, 11:03 am, 1307223

LONDON–A pickup in the global economy is needed if the U.K. is to enjoy a durable recovery, one of the Bank of England‘s top officials said Tuesday.
Ben Broadbent, deputy governor for monetary policy, said in a speech in London that the rapid pace of expansion in the U.K. economy ...


July 29, 2014, 11:03 am, 1307224

 

Women appear to be gaining ground in Japan’s workforce as the employment situation brightens.

Prime Minister Shinzo Abe has trumpeted the need to get more women in the workforce as ...


July 29, 2014, 11:03 am, 1307218

The Bank of Korea’s dovish shift has been officially put on record.

On Tuesday, minutes of the central bank’s July 10 policy board meeting revealed Chung Hae-bang as the first board member in over a year to oppose a decision to keep rates on hold.

“A comprehensive review of recent conditions shows ...


July 29, 2014, 11:03 am, 1307222

The cost of propping up China’s banks in the event of a financial crisis have nearly quadrupled in the past three years to $526.2 billion, the largest of any banking system, according to the latest analysis by the Volatility Laboratory at New York University’s Stern School of Business .


July 29, 2014, 11:03 am, 1307221
Japanese Prime Minister Shinzo Abe.

The “virtuous cycle” for Japan’s economic recovery seems to be spinning a little slower these days.

That doesn’t necessarily mean the grand Abenomics experiment is faltering. ...


July 29, 2014, 11:03 am, 1307219

As expected, the pace of U.S. home price gains has slowed this year. Prices rose 9.3% from a year earlier in May in 20 cities tracked by the Standard & ...


July 29, 2014, 11:03 am, 1307220

The Wall Street Journal’s Daily Report on Global Central Banks for Tuesday, July 29, 2014:

Sign up for the newsletter.

Highlights

Hilsenrath’s Take: Tame Inflation Expectations a Trump Card for Fed’s Doves New Bank of England ...


July 29, 2014, 11:03 am, 1307217

Me, at CBS MoneyWatch:

Is it worth spending to make workers happy?: Numerous studies have found a correlation between employee satisfaction and company success. Does this mean happy employees are also the most productive workers? Should firms spend money to make workers happier with their jobs?

Answering these questions is ...


July 29, 2014, 11:03 am, 1307216

I have a new column:

Why the Rich Should Call for Income Redistribution: After the craze over Thomas Piketty’s Capital in the Twenty First Century, nobody should be surprised to learn that inequality has been increasing over the last several decades. The question is what to do about it.


July 29, 2014, 11:03 am, 1307214
The Census Bureau released the Housing Vacancies and Homeownership report for Q2 2014 this morning.

This report is frequently mentioned by analysts and the media to track the homeownership rate, and the homeowner and rental vacancy rates. However, there are serious questions about the accuracy of this ...


July 29, 2014, 11:03 am, 1307215
S&P/Case-Shiller released the monthly Home Price Indices for May ("May" is a 3 month average of March, April and May prices).

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

Note: Case-Shiller reports Not Seasonally Adjusted (NSA), I use ...


July 29, 2014, 10:45 am, 1307212
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July 29, 2014, 10:45 am, 1307213
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July 29, 2014, 10:45 am, 1307211
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July 29, 2014, 10:45 am, 1307210
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July 29, 2014, 10:36 am, 1307209

Simon Wren-Lewis wonders why the government has been so silent about stagnating productivity. I suspect there's a simple reason for this: you don't look a gift horse in the mouth. The drop in productivity growth has saved Osborne a massive embarrassment.

To see this, consider ...


July 29, 2014, 9:33 am, 1307203

Money is fungible. And things get lost in translation, especially between micro and macro.

"Helicopter money" is when the central bank prints money, gives it to the government, and the government gives it to everyone, as a freebie.

When is helicopter money optimal?

Preliminary answer: almost all the time. Because almost every year, ...


July 29, 2014, 9:33 am, 1307202

|Peter Boettke|

Today -- July 29th -- is Peter Leeson's birthday, he is 35. Happy Birthday Pete.

Pete was recently named the Duncan Black Professor of Economics and Law ...


July 29, 2014, 9:33 am, 1307201

Justin Wolfers:

Since North Carolina effectively eliminated unemployment benefits last year for people unemployed 20 weeks or more, the state has become a symbol in the partisan wars over economic policy. People on either side of those wars have argued that it proves the economic advantages — or damage — of ...


July 29, 2014, 9:03 am, 1307139

The Wall Street Journal’s Daily Report on Global Central Banks for Tuesday, July 29, 2014:

Sign up for the newsletter.

Highlights

Hilsenrath’s Take: Tame Inflation Expectations a Trump Card for Fed’s Doves New Bank of England ...


July 29, 2014, 8:36 am, 1307138
Private nonfarm payrolls in the US are projected to increase 271,000 (seasonally adjusted) in July over the previous month in tomorrow’s release of the ADP Employment Report, based on The Capital Spectator’s median econometric point forecast. The expected gain is … Continue reading →


July 29, 2014, 8:36 am, 1307137

How do you catch a tax and pin it down? Can governments make corporations “stay and listen to all they say?” Treasury Secretary Jack Lew in his Washington Post op-ed called on Congress to immediately stop corporations from lowering taxes by incorporating overseas. Former Treasury official ...


July 29, 2014, 8:34 am, 1307136
Teaser:

Increasing ...


July 29, 2014, 8:05 am, 1307135

For the most part, no, although financial repression is an issue to look out for.  There is a new NBER Working Paper by Jens Hilscher, Alon Raviv, and Ricardo Reis which works through the numbers:

We propose and implement a method that provides quantitative estimates of the extent to ...


July 29, 2014, 8:05 am, 1307134

Israel’s major problem is that circumstances always change. Predicting the military capabilities of the Arab and Islamic worlds in 50 years is difficult. Most likely, they will not be weaker than they are today, and a strong argument can be made that at least several of their constituents will be stronger. ...


July 29, 2014, 8:04 am, 1307133
(July 29, 2014 07:01 AM, by Alberto Mingardi) A few weeks ago I participated in the "Economic Ideas Forum" in Nancy, France. It is a fascinating event, organised by the local Chamber of Commerce, in synergy with other organisations, including the Institut Economique Molinari, the French think tank... (0 COMMENTS)


July 29, 2014, 8:04 am, 1307132
(Don Boudreaux)

… is from page 187 of Matt Ridley’s 2010 volume, The Rational Optimist (link added):

Trade, says Johan Norberg, is like a machine that turns potatoes into computers, or anything into anything: who would not want to have such a machine at their disposal?

If you doubt or otherwise ...


July 29, 2014, 8:04 am, 1307131


July 29, 2014, 7:33 am, 1307128

Ira Stoll, Reason:

The current system takes rich money managers, who ordinarily might be a voice for lower taxes and restrained government spending, and makes them beholden, for business, on public pension boards that sometimes include union officials. Instead of arguing for less generous pensions, or for ...


July 29, 2014, 7:33 am, 1307127

K. C. Johnson winds up the "Durham-In-Wonderland" blog.

He bravely accomplished, very well, what he set out to do, so now he's moving on. (If only some government agencies--hello, TVA!--did the same.)


July 29, 2014, 7:33 am, 1307126

Jim Manzi:

In summary, Piketty has weak evidence to support his theory for why CEO pay has increased in America.What evidence he has covers only CEOs of public companies, and hence about 3 percent of the top 0.1 percent.His whole model, even if correct and extended beyond ...


July 29, 2014, 7:33 am, 1307125

Includes this information important, I think, for addessing the problem:

Every year, there are horrific crimes against female students, often perpetrated by a small number of men who prey upon first-year women who are under the influence of alcohol.United Educators, an insurance company ...


July 29, 2014, 7:33 am, 1307124

July 29, 2014, 7:23 am, 1307123
Below are links to a number of recent films about economic researchand policy debates - our thanks toRomesh Vaitilingam for collating them.


July 29, 2014, 7:03 am, 1307081

The Bank of Korea’s dovish shift has been officially put on record.

On Tuesday, minutes of the central bank’s July 10 policy board meeting revealed Chung Hae-bang as the first board member in over a year to oppose a decision to keep rates on hold.

“A comprehensive review of recent conditions shows ...


July 29, 2014, 6:45 am, 1307079
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July 29, 2014, 6:45 am, 1307080
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July 29, 2014, 6:45 am, 1307078
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July 29, 2014, 5:33 am, 1307075

July 29, 2014, 5:33 am, 1307074
The war in Ukraine is going so well that soldiers are unpaid and men are ordered to serve whether they want to or not.

Hats off to a group of women who confront a Ukrainian soldier and burn military writs right in front of the soldier's face.


July 29, 2014, 5:23 am, 1307073
In this blog, Professor Simon Wren-Lewis from Oxford University bemoans the absence of debate over the notion of a maximum wage - with specific reference to the pay of senior executives.


July 29, 2014, 5:23 am, 1307072
How much money do you need for an 'adequate' standard of living? This short video from the Joseph Rowntree Foundation considers the levels of income needed to sustain a modest butadequate life-style in the UK in 2014.


July 29, 2014, 5:23 am, 1307071
Here is a link to a video report produced by the IMF as part of theirannual assessment of the UK economy. Overall, the IMF is considerably more optimistic than it was in 2013 about prospects for near term recovery of output and continued reductions in unemployment.Risks to macro stability are ...


July 29, 2014, 5:03 am, 1307008
Japanese Prime Minister Shinzo Abe.

The “virtuous cycle” for Japan’s economic recovery seems to be spinning a little slower these days.

That doesn’t necessarily mean the grand Abenomics experiment is faltering. ...


July 29, 2014, 5:03 am, 1307010

LONDON–A pickup in the global economy is needed if the U.K. is to enjoy a durable recovery, one of the Bank of England‘s top officials said Tuesday.
Ben Broadbent, deputy governor for monetary policy, said in a speech in London that the rapid pace of expansion in the U.K. economy ...


July 29, 2014, 5:03 am, 1307009

The cost of propping up China’s banks in the event of a financial crisis have nearly quadrupled in the past three years to $526.2 billion, the largest of any banking system, according to the latest analysis by the Volatility Laboratory at New York University’s Stern School of Business .


July 29, 2014, 5:03 am, 1307007

Every month, when the U.S. Bureau of Labor Statistics (BLS) puts out its Employment Situation report, it provides the results of two different surveys that it ...


July 29, 2014, 5:03 am, 1307006

July 29, 2014, 4:05 am, 1307005

Here is one way to boost the employment to population ratio, two birds with one stone you might say:

Feng’s 23 year-old son, “Xiao Feng” (小冯) started playing video games in high school. Through his years of playing various online games, he supposedly thought himself a master of Chinese online role ...


July 29, 2014, 3:23 am, 1307002

In my view, these were my best posts written between February and April 2013:

Wall Street Hates You

I have a saying, “Don’t buy what someone wants to sell you. Buy what you have researched.”

And so I would tell everyone: don’t give brokers discretion over you accounts, and don’t ...


July 29, 2014, 3:23 am, 1307001
Does inequality in the output of scientists matter? Inequality is a fashionable topic these days, and evidence for its existence is keenly sought in all sorts of places. John Ioannidis, a health policy researcher at Stanford, and his colleagues have found it in the research outputs of their ...


July 29, 2014, 1:03 am, 1306930

 

Women appear to be gaining ground in Japan’s workforce as the employment situation brightens.

Prime Minister Shinzo Abe has trumpeted the need to get more women in the workforce as ...


July 29, 2014, 12:34 am, 1306929

With the failure of central planning worldwide, many economists have turned to promoting government as an innovative and entrepreneurial institution that fosters greater efficiency and economic growth. In truth, governments fail where private entrepreneurs succeed. Governments keep wasting money in the meantime.


July 29, 2014, 12:04 am, 1306927
(July 29, 2014 12:20 AM, by Bryan Caplan) Mike Huemer, to repeat, is my favorite philosopher. Here are some highlights from his recent working paper, "Is Wealth Redistribution a Rights Violation?" [footnotes omitted]There are at least three broad views one might take concerning the foundation ofproperty rights:a. The... (0 COMMENTS)


July 28, 2014, 10:04 pm, 1306887

You know we have talked about this at the state legislature before, nullification. But, bottom line is, as U.S. Senator why should we be passing laws that the states are considering nullifying? Bottom line: our legislators at the federal level should not be passing those laws. We’re right…we’ve gone 200-plus ...


July 28, 2014, 9:23 pm, 1306886
One hundred years ago today World War I (WWI) began. On this anniversary there has been a lot of discussion about the war and its implications for the century that followed. Today, as I traveled, I got to listen to one such discussion on the NPR program,


July 28, 2014, 9:03 pm, 1306862
A glass half empty view from Mark Hanson: Lack of Defaults/Foreclosures/Short Sales; A Serious Housing & Spending Headwind

Most think of the effects of foreclosures & short sales (distressed) only in the first derivative…that they are bad for housing and prices. As such, bullish leaning headlines of plunging ...


July 28, 2014, 8:45 pm, 1306861
The Wall Street Journal's Congress team takes stock of where things stand on Capitol Hill a week before the August recess.


July 28, 2014, 8:44 pm, 1306860
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July 28, 2014, 8:05 pm, 1306858

Mises Daily Monday by George Reisman.

Many Americans, perhaps a substantial majority, still believe that labor unions are fundamental to the well-being of workers. In fact, labor unions work to ...


July 28, 2014, 8:04 pm, 1306857
(July 28, 2014 07:20 PM, by Scott Sumner) Market monetarists tend to prefer using monetary policy to stabilize the path of NGDP, not fiscal policy. We are skeptical of the efficacy of fiscal policy, and also view it as being inefficient. Now David Beckworth has suggested that a... (0 COMMENTS)


July 28, 2014, 7:33 pm, 1306856
Peter Haisenko, a German aviation expert made a claim yesterday that air-to-air fire brought down MH17.

The above link is to a translated page.

As a lay person, it's easy to be persuaded by such arguments. Moreover, even if Haisenko is an aviation expert, one has ...


July 28, 2014, 7:03 pm, 1306806
Here is another weekly update on housing inventory ...

SPECIAL NOTE from Ben at Housing Tracker:

I'm seeing higher than expected inventories in Dallas, Orlando and Tampa that do not appear to be accurate representations of reality. Data for those cities may be more suspect than data for other ...


July 28, 2014, 6:44 pm, 1306805

Judge Griesa has approved Citibank's request to transfer funds it received in payment of both dollar- and peso-denominated, Argentine-law bonds. Order attached. The difficulty, as described in this recent letter from Citibank, is that some of the ...


July 28, 2014, 6:05 pm, 1306803

Archived from the live broadcast, this Mises University lecture was presented at the Mises Institute in Auburn, Alabama, on 24 July 2014.


July 28, 2014, 6:04 pm, 1306802
(July 28, 2014 07:15 PM, by David Henderson) In a comment on my earlier post today, Tom West writes: I'm fairly certain that most infrastructure projects like pipelines or electrical transmission corridors would *never* get built without the government power of eminent domain. That's a reasonable view, and... (1 COMMENTS)


July 28, 2014, 6:04 pm, 1306801

When Keynes wrote about Effective Demand in Chapter 3 of General Theory… he tied the limit of effective demand to the maximization of profits. Currently I see the economy reaching the effective demand limit by the end of 2014. Is there a sign that profits are maximizing?

Here is Gina Martin ...


July 28, 2014, 5:33 pm, 1306798

Margaret Thatcher once accused a Liberal member of parliament of wishing to have “the poor poorer provided the rich were less rich.” The Iron Lady would probably say much the same to economist and inequality researcher Thomas Piketty after the reading the following analysis from the Tax Foundation. The report ...


July 28, 2014, 5:03 pm, 1306737

It’s been nearly seven years since the market for so-called private-label mortgage bonds, or those that aren’t backed by government-related entities, dried up. For years, government policy makers and financiers have speculated ...


July 28, 2014, 4:45 pm, 1306736
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July 28, 2014, 4:44 pm, 1306735

“THIS dollar-a-day measure,” says Amartya Sen, a Nobel laureate in economics, “doesn’t take into account many variations that influence the conversion of income into good living.” Mr Sen argues that if we simply focus on eradicating extreme poverty (living on less than $1.25 a day), we will miss important social ...


July 28, 2014, 4:05 pm, 1306734

…trade typically favors the poor, who concentrate spending in more traded sectors.

That is from Pablo D. Fajgelbaum and Amit K. Khandelwal, the full paper is here.


July 28, 2014, 4:04 pm, 1306733

Mark Cook is an investor who uses his own proprietary indicator to assess the stock market. He saw the crashes of 1987, 2000 and 2007.  (article from WSJ Market Watch) He is seeing the stock market going into strange territory at the moment.

“It’s like being in the ...


July 28, 2014, 3:33 pm, 1306718
Is the pound overvalued? What about the Euro? The US Dollar? The Yen?

Curiously, economists make that case for all of those currencies. And today, the IMF is pounding the drums with this proclamation "Overvalued" Pound Prevents Rebalancing.

The International Monetary Fund warned on ...


July 28, 2014, 3:33 pm, 1306717

By Rick Mattoon

This is a second in a series of blogs that highlights findings from an upcoming Economic Perspectives article on economic development efforts and industry trends in the largest metropolitan areas in the Seventh District. (For a complete profile of all five cities see, Industrial ...


July 28, 2014, 3:33 pm, 1306716

What do you do when you run out of contrived nicknames?

http://comicskingdom.com/mark-trail/20
14-07-15

The best comment at the website is the first:

Chris must have heard that Mark won't fight dirty. Well played. Well played indeed.

And subsequent strips reveal that Mark is faster than a herd of frightened ...


July 28, 2014, 3:33 pm, 1306715

Sarah Kliff of Vox reads the Medicare Trustee report and finds, “Slow health cost growth has improved Medicare’s financial outlook, extending the program’s trust fund to last until 2030.” Wow, that still doesn’t seem so far off. But Kliff says not to worry:


July 28, 2014, 3:33 pm, 1306714

Dallas Fed President Richard Fisher makes the case that a too-easy Fed is what really threatens the central bank’s independence (via the WSJ):

Those of us who are the current trustees of the Fed’s reputation—the FOMC—must be especially careful that nothing we do appears to be politically motivated. In ...


July 28, 2014, 3:33 pm, 1306712

1.) AEI’s James Capretta writes on “Halbig and its aftermath”:

The court ruled that only state-based exchanges can pay the ACA’s premium credits to insurers on behalf of plan enrollees, meaning that the back-up federal exchange, now used in 36 states, can offer insurance choices to the ...


July 28, 2014, 3:33 pm, 1306713

Four years on, one effect of 2010’s Dodd-Frank Act is to incentivize US banks to push much of their swaps trading (often credit default swaps, or CDS) offshore. While the intention — always a dangerous word in Washington — of the regulation was to increase transparency and accountability in these markets, let’s ...


July 28, 2014, 3:03 pm, 1306651

MONDAY

Israel’s central bank releases a policy statement at 1600 local time (1300 GMT)

TUESDAY

BOE’s Broadbent speaks in London at 0700 GMT Federal Reserve begins a two-day policy meeting in Washington

WEDNESDAY

Federal Reserve releases a policy statement at 2 p.m. EDT

THURSDAY

The Philippines’ central bank releases a policy statement Czech National Bank releases a policy statement ...


July 28, 2014, 3:03 pm, 1306650

Officials at the Federal Reserve have been experimenting with how best to control interest rates in a post-crisis financial system flush with excess cash. The International Monetary Fund said Monday the Bank of England may need to think about doing something similar.

In its annual health-check of the U.K. ...


July 28, 2014, 3:03 pm, 1306649

It’s been nearly seven years since the market for so-called private-label mortgage bonds, or those that aren’t backed by government-related entities, dried up. For years, government policy makers and financiers have speculated ...


July 28, 2014, 3:03 pm, 1306648
Freddie Mac reported that the Single-Family serious delinquency rate declined in June to 2.07% from 2.10% in May. Freddie's rate is down from 2.79% in June 2013, and this is the lowest level since January 2009. Freddie's serious delinquency rate peaked in February 2010 at 4.20%.


July 28, 2014, 2:45 pm, 1306647
The Wall Street Journal's Congress team takes stock of where things stand on Capitol Hill a week before the August recess.


July 28, 2014, 2:45 pm, 1306646
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July 28, 2014, 2:45 pm, 1306645
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July 28, 2014, 2:45 pm, 1306644
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July 28, 2014, 2:44 pm, 1306643

At its annual meeting, the National Conference of Commissioners on Uniform State Laws (NCCUSL) formally adopted the Uniform Voidable Transactions Act (UVTA). Under its provisions, I believe it says any service member in uniform will be able to avoid a transaction . . . . Hold on, let ...


July 28, 2014, 2:34 pm, 1306642

The U.S. Chamber of Commerce has been at the center of many of the “Establishment v. Tea Party” battles that we’ve seen during the 2014 primary season, generally backing incumbents and candidates closer to the traditional idea of Republican ...


July 28, 2014, 2:05 pm, 1306637

Archived from the live broadcast, this Mises University lecture was presented at the Mises Institute in Auburn, Alabama, on 24 July 2014.


July 28, 2014, 2:05 pm, 1306636

On July 14, Mark Thornton’s Mises Daily article explored how Drug War violence in Central America was a major factor in creating the child refugee crisis on the southern US border. On July 20, The Wall Street Journal published ...


July 28, 2014, 2:05 pm, 1306635

July 28, 2014, 2:04 pm, 1306634
(July 28, 2014 12:19 PM, by Art Carden) Here's one reason to think time travel a la Back to the Future or one of the truly great but definitely most NSFW episodes of South Park will never work: we don't have contemporary or historical reports of time-traveling arbitrageurs.... (8 COMMENTS)


July 28, 2014, 2:04 pm, 1306633
(Don Boudreaux)

GMU Econ PhD student Liya Palagashvili and I have studied some numbers that Barack Obama and plenty of pundits have seized upon as evidence that raising the minimum wage is good economic policy.  Here – in U.S. News & World Report – is our first attempt to expose ...


July 28, 2014, 1:33 pm, 1306629

30 years ago, IIRC, my colleague Steve Ferris said I should read Lloyd Metzler's Wealth, Saving, and the Rate of Interest, because he thought it was a great paper. Yesterday Brad DeLong said the same thing. David Glasner also thinks it's a classic paper. ...


July 28, 2014, 1:33 pm, 1306628

By Rick Mattoon

This is a second in a series of blogs that highlights findings from an upcoming Economic Perspectives article on economic development efforts and industry trends in the largest metropolitan areas in the Seventh District. (For a complete profile of all five cities see, Industrial ...


July 28, 2014, 1:33 pm, 1306627

From the inbox:

Dear Dr. Whitehead,

Elsevier is pleased to announce the release of the 2013 Journal Metrics based on Scopus data.

The metrics provide alternative, transparent and accurate views of the citation impact a journal makes, and are all available for free download at www.journalmetrics.com. The impact metrics are based ...


July 28, 2014, 1:33 pm, 1306626

From the inbox:

While searching for info on Contingent Valuation stuff, I ran across this piece you wrote, and just wanted to say that it's very funny. Maybe you should get into comedy writing as a second career.

My reply:

ha! thanks ... people tell me that about some of my ...


July 28, 2014, 1:33 pm, 1306625

Just how much action will President Obama take in his “year of action”? Lots of attenttion being given to what the president will do about immigration. But, trust me, this really got the attention of Corporate America this morning (via Reuters):

President Barack Obama could act without congressional ...


July 28, 2014, 1:33 pm, 1306624

Judging by the return of European sovereign bond yields to pre-crisis levels, one could be forgiven for thinking that the European sovereign debt crisis was now well behind us. However, sovereign debt data released by EUROSTAT last week should dispel any such notion. For those data show that after many ...


July 28, 2014, 1:33 pm, 1306623

In two recent articles in the New York Times Your Money section, business editor Jeff Sommer wrote about the superiority of passively managed index funds over actively managed funds. Sommer cites a June 2014 study by S&P Dow Jones Indices titled “Does Past ...


July 28, 2014, 1:03 pm, 1306561

MONDAY

Israel’s central bank releases a policy statement at 1600 local time (1300 GMT)

TUESDAY

BOE’s Broadbent speaks in London at 0700 GMT Federal Reserve begins a two-day policy meeting in Washington

WEDNESDAY

Federal Reserve releases a policy statement at 2 p.m. EDT

THURSDAY

The Philippines’ central bank releases a policy statement Czech National Bank releases a policy statement ...


July 28, 2014, 1:03 pm, 1306560

Officials at the Federal Reserve have been experimenting with how best to control interest rates in a post-crisis financial system flush with excess cash. The International Monetary Fund said Monday the Bank of England may need to think about doing something similar.

In its annual health-check of the U.K. ...


July 28, 2014, 12:35 pm, 1306559

The Child and Dependent Care Tax Credit (CDCTC) does not work for low-income families. It fails on three counts – the credit is nonrefundable, covers only a portion of expenses, and comes long after expenses have been incurred.

Senators Jeanne Shaheen (D-NH), Barbara Boxer (D-CA), Patty Murray (D-WA), and Kristin ...


July 28, 2014, 12:34 pm, 1306558

Six years ago, the Supreme Court handed down its decision in District of Columbia v. Heller in which it struck down the District of Columbia’sOn Saturday, a Federal Judge issued a ruling striking down the District of ...


July 28, 2014, 12:34 pm, 1306557
A


July 28, 2014, 12:05 pm, 1306556

Alan S. Blinder and Mark W. Watson have a useful unpacking of this question, here is the abstract summarizing their conclusions:

The U.S. economy has grown faster—and scored higher on many other macroeconomic metrics—when the President of the United States is a Democrat rather than a Republican. For many measures, including ...


July 28, 2014, 12:04 pm, 1306555
(Don Boudreaux)

From the great folks at Reason we get Remy’s response to Kristen Bell’s economically uninformed attempt to justify an increase in the minimum wage.


July 28, 2014, 12:04 pm, 1306554

After taking a nearly-month-long hiatus from blogging here about legal issues, and blogging only very lightly about other things, I posted this controversial post last Friday and participated in a lengthy comments thread.  The final comment of mine, in reference to some of the preceding comments of others and of mine, ...


July 28, 2014, 12:04 pm, 1306553

The Countdown is ON!

(Update for Post Publication) If things go as scheduled the 2014 Report of the Trustees of Social Security wil be released to the web at 12:15 Easter or less than two hours from the time this post published. Assuming the same continuity in URLs between Reports as ...


July 28, 2014, 11:33 am, 1306550

Each year, Washington spends billions of dollars more than it takes in, and the problem will only get worse. The recent Congressional Budget Office (CBO) long-term budget outlook shows a $40 trillion increase in debt over the next two decades. Even soaring tax receipts will not be able to keep ...


July 28, 2014, 11:33 am, 1306549

This is an excerpt from the article “Another Ice Age?” which appeared in the June 24, 1974 issue of Time Magazine (emphasis added):

In Africa, drought continues for the sixth consecutive year, adding terribly to the toll of famine victims. During 1972 record rains in parts of the U.S., ...


July 28, 2014, 11:03 am, 1306486

In his recent speech calling for legislation to stop corporate inversions, President Obama added fuel to the misperception that when a company moves its headquarters to another country it avoids paying U.S. taxes. He said, "If you are doing business here, if you are basically an American company but ...


July 28, 2014, 11:03 am, 1306485

The Philippines’ public debt has been falling fast, helping its chances of credit upgrades and further attracting foreign capital.

On Friday, the government said total public debt as a fraction of gross domestic ...


July 28, 2014, 11:03 am, 1306484

MONDAY

Israel’s central bank releases a policy statement at 1600 local time (1300 GMT)

TUESDAY

BOE’s Broadbent speaks in London at 0700 GMT Federal Reserve begins a two-day policy meeting in Washington

WEDNESDAY

Federal Reserve releases a policy statement at 2 p.m. EDT

THURSDAY

The Philippines’ central bank releases a policy statement Czech National Bank releases a policy statement ...


July 28, 2014, 11:03 am, 1306483

The Wall Street Journal’s Daily Report on Global Central Banks for Monday, July 28, 2014:

Sign up for the newsletter.

Highlights

Hilsenrath’s Take: Time To Take Measure of Fuzzy U.S. Growth Accounting Fed’s Rate Debate Looks ...


July 28, 2014, 11:03 am, 1306481

Officials at the Federal Reserve have been experimenting with how best to control interest rates in a post-crisis financial system flush with excess cash. The International Monetary Fund said Monday the Bank of England may need to think about doing something similar.

In its annual health-check of the U.K. ...


July 28, 2014, 11:03 am, 1306482

Bank of Japan officials are becoming less confident in their outlook on exports after having erred on the side of optimism for more than a year, setting the stage for fresh debate at their policy meeting next week.

The central bank’s assessment of exports warrants close attention, ...


July 28, 2014, 11:03 am, 1306480

Alan Blinder and Mark Watson:

Presidents and the U.S. Economy: An Econometric Exploration, by Alan S. Blinder and Mark W. Watson, NBER Working Paper No. 20324 [open link]: The U.S. economy has grown faster—and scored higher on many other macroeconomic metrics—when the President of the United States is a ...


July 28, 2014, 11:03 am, 1306479
Notes: I follow several house price indexes (Case-Shiller, CoreLogic, Black Knight (formerly LPS), Zillow, FHFA, FNC and more). The timing of different house prices indexes can be a little confusing. Black Knight uses the current month closings only (not a three month average like Case-Shiller or a weighted average ...


July 28, 2014, 11:03 am, 1306477
From the Dallas Fed: Texas Manufacturing Activity Picks up Pace Again

Texas factory activity increased again in July, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, rose from 15.5 to 19.1, indicating output grew at ...


July 28, 2014, 11:03 am, 1306478
From the NAR: Pending Home Sales Slip in June

The Pending Home Sales Index, a forward-looking indicator based on contract signings, declined 1.1 percent to 102.7 in June from 103.8 in May, and is 7.3 percent below June 2013 (110.8). Despite June’s decrease, the index is above 100 – ...


July 28, 2014, 10:45 am, 1306476
A


July 28, 2014, 10:45 am, 1306475
A


July 28, 2014, 10:44 am, 1306474

The bill admits, that the whole amount divided among all the [creditors], was not enough to satisfy the complainant’s debt. What a singular proposition then to maintain, that although the whole were only entitled, in Law, to a less sum than this individual claims, out of the ...


July 28, 2014, 10:36 am, 1306473

Accountants EY say that the number of firms issuing profit warnings has risen. This reminds us of an awkward fact - that real wages haven't fallen because capitalists have increased their exploitation of workers. Instead, they've fallen because productivity has fallen. And lower productivity means


July 28, 2014, 10:05 am, 1306469

Toshio Murata was a student of Mises in New York, and translated Human Action into Japanese. He is almost single-handedly responsible for creating an Austrian/Misesian movement in Japan.

Marc Abela, head of Mises Japan, sends us this update:

Entering his 90s this year, professor Toshio Murata, ...


July 28, 2014, 10:05 am, 1306470

Archived from the live broadcast, this Mises University lecture was presented at the Mises Institute in Auburn, Alabama, on 24 July 2014.


July 28, 2014, 10:04 am, 1306468
(Don Boudreaux)

Here’s a letter to a long-time friend, a gentleman who largely supports free markets.

Mr. Gordon J___________

Dear Gordon:

Thanks for your note in defense of the Export-Import Bank.

I’ll not respond to each of your arguments (especially because Vero has addressed these claims in her many well-researched and reasoned writings on ...


July 28, 2014, 9:33 am, 1306465

And announcing it as if I totally believe it:

When a study found that the business school at the University of Missouri at Kansas City boasted the world’s No. 1 program in innovation-management research, officials from the chancellor on down basked publicly in the news.

Now an investigation by The Kansas ...


July 28, 2014, 9:03 am, 1306404

The Philippines’ public debt has been falling fast, helping its chances of credit upgrades and further attracting foreign capital.

On Friday, the government said total public debt as a fraction of gross domestic ...


July 28, 2014, 9:03 am, 1306402

Bank of Japan officials are becoming less confident in their outlook on exports after having erred on the side of optimism for more than a year, setting the stage for fresh debate at their policy meeting next week.

The central bank’s assessment of exports warrants close attention, ...


July 28, 2014, 9:03 am, 1306403

The Wall Street Journal’s Daily Report on Global Central Banks for Monday, July 28, 2014:

Sign up for the newsletter.

Highlights

Hilsenrath’s Take: Time To Take Measure of Fuzzy U.S. Growth Accounting Fed’s Rate Debate Looks ...


July 28, 2014, 8:35 am, 1306401
The US economy is expected to post a substantial rebound in the government’s initial estimate of second-quarter GDP that’s scheduled for release on Wednesday, according to the Capital Spectator’s median econometric nowcast. Following the surprisingly sharp 2.9% decline for Q1 … Continue reading →


July 28, 2014, 8:35 am, 1306400

The Highway Trust Fund is almost out of gas. Congress leaves for its month-long recess on Friday, but without legislative action the fund will run out in August. The Senate is expected to vote on the amended bill this week, though it needs 60 votes to pass. Senate Majority Leader ...


July 28, 2014, 8:34 am, 1306399
Teaser:

In ...


July 28, 2014, 8:04 am, 1306396
(Don Boudreaux)

… is from page 341 of my great emeritus colleague Gordon Tullock’s 1987 essay “Concluding Thoughts on the Politics of Regulation,” which is the final chapter of the insight-rich 1987 collection Public Choice & Regulation: A View from Inside the Federal Trade Commission (Robert J. Mackay, James C. Miller ...


July 28, 2014, 7:33 am, 1306391

July 28, 2014, 7:33 am, 1306393

By Isabel Sawhill, Senior Fellow at Brookings. Includes this:

A child's education begins in the home. No improvement in public policy can compete with what only families can provide.


July 28, 2014, 7:33 am, 1306392

Very well put.

But I will not apologise for surviving.

For surviving missiles intended to kill me. The fact they didn’t kill me doesn’tmean they weren’t sent with the intention to murder. We have a defence system, shelters, evacuation procedures and governments who take care of ...


July 28, 2014, 7:33 am, 1306388

Magnificent attack on education reform by Andrew Ferguson. Virtually no one escapes. He concludes as follows:

The delays and distancing suggest a cloudy future for the Common Core. Even its advocates say that the best possible outcome for now involves a great deal more unpleasantness: The tests ...


July 28, 2014, 7:33 am, 1306389

Still more on the fabulous lie that "government is the name we give to things we do together":

The New York Times reports that "cities across California are encouraging residents to tattle on their neighbors for wasting water" — just the kind of behavior that we want ...


July 28, 2014, 7:33 am, 1306390

Professor Emeritus of Economics at the Univ. of Wisconsin-Madison, W. Lee Hansen:

The University of Wisconsin adopted its first diversity plan back in 1966 and every few years it launches a much-touted new one. During my 30-year teaching career at Madison, followed by more than a decade ...