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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October 2, 2014, 6:04 am, 1344843
(Don Boudreaux)

For everyone who presumes that democratically elected governments are generally manned by people who would recoil at the mere thought of committing gross injustices against innocent people, watch this short video on civil forfeiture from the Institute for Justice to test the robustness of your presumption.


October 2, 2014, 5:23 am, 1344839

Labour productivity measures the output per worker in a period of time. Labour productivity is an important factor in determining the productive potential of the economy. Countries with strong labour productivity growth tend to benefit from high rates of growth, strong ...


October 2, 2014, 5:03 am, 1344791
Associated Press

The European Central Bank is expected to refrain from new stimulus measures when it meets Thursday in Naples, Italy and instead focus on implementing a new, private-asset purchase program that was part of September’s stimulus ...


October 2, 2014, 5:03 am, 1344792

The glass ceiling is still there, but it’s getting thinner.

A trio of economists, wielding big data from Social Security’s records, says that in 1981-85, women constituted just 1.9% of the top 0.1% of earners (based on average earnings for those years) and 3.2% of the top 1%.


October 2, 2014, 5:03 am, 1344794

Nigeria’s finance minister Ngozi Okonjo-Iweala says the Ebola virus is having a negligible impact on her country’s economy, but the Boko Haram insurgency is eroding growth prospects.

Agence France-Presse/Getty Images

“We’re ...


October 2, 2014, 5:03 am, 1344790

Nearly a quarter of metropolitan areas had fewer jobs in August than five years earlier, showing that the national labor market recovery has missed broad swaths of the U.S.

According to Labor Department data released Wednesday, 92 regions have experienced net job loss since August 2009 despite the country steadily ...


October 2, 2014, 5:03 am, 1344793

Unemployment is much more damaging to society than moderate levels of inflation, making central bankers’ disproportionate focus on the level of consumer price growth misguided, a former Bank of England rate-setter now at Dartmouth College writes in a new paper.

Along with three co-authors, David Blanchflower, known for his ...


October 2, 2014, 5:03 am, 1344785
The demonstrations in Hong Kong will not impact the economy unless they continue for some time, according to the new chief economist of the Asian Development Bank.


October 2, 2014, 5:03 am, 1344786

At least two private economists are marking down their growth estimates for a quarter that is set to shape the government’s decision on whether to raise the national sales tax next year.

A ...


October 2, 2014, 5:03 am, 1344789

One of the strange quirks in the U.S. government’s “Buy American” laws is that many items covered by the rules—from hand tools to trolley cars—wouldn’t necessarily be able to carry a “Made in USA” label if found on a store shelf.

The Buy American Act, for instance, around since the Great ...


October 2, 2014, 5:03 am, 1344787

A rise in the pound last year has helped keep a lid on inflation in the U.K. but that effect may soon start to fade, one of the Bank of England‘s top policy makers said Wednesday.


October 2, 2014, 5:03 am, 1344788

NAPLES–European Central Bank President Mario Draghi used Hercules to illustrate the challenges facing European policymakers to get the eurozone economy out of its doldrums.

“As policymakers in Italy and in the euro area, it often feels like we face a Herculean task to revive growth and bring down unemployment,” he ...


October 2, 2014, 5:03 am, 1344784

Did you know that there is a shortage ...


October 2, 2014, 5:03 am, 1344783

October 2, 2014, 2:44 am, 1344748
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October 2, 2014, 2:04 am, 1344747
(October 2, 2014 12:23 AM, by Bryan Caplan) Support for marijuana legalization was stalled for decades, then skyrocketed. What happened? Vox's latest analysis heavily relies on sociologist Fabio Rojas, also known as the Best Man at my wedding. Highlights:Fabio Rojas, a professor at Indiana University who studies social... (0 ...


October 2, 2014, 2:04 am, 1344746
The Financial Times reported on September 30th that the European Commission has decided to open a formal investigation into whether Apple received illegal subsidies (“state aid,” in EU-speak) from Ireland going as far back as 1991. The FT quotes “people involved in the case” as saying that this can cost ...


October 2, 2014, 1:33 am, 1344745
Exceptionally good news from California today: A federal judge ruled CALpers claim of "Sanctity of Pensions" is invalid. Today's ruling went even further than the bankrupt city of Stockton originally sought in court.

For details, please consider the New York Times article In Ruling on California Town’s ...


October 2, 2014, 1:03 am, 1344710

At least two private economists are marking down their growth estimates for a quarter that is set to shape the government’s decision on whether to raise the national sales tax next year.

A ...


October 2, 2014, 1:03 am, 1344709

With lagging economic growth, and the massive tax cuts, revenues are falling below projection. From The Topeka Capital Journal today:

Tax collections by Kansas state government in September fell a sobering $21 million below projections to mark the fourth time in the past six months revenue failed to match targets, ...


October 2, 2014, 12:34 am, 1344708

John Whitehead of the Rutherford Institute talks with Lew Rockwell about his new book, the state, war, police, and education.


October 2, 2014, 12:34 am, 1344707

In its secession effort, Scotland should have employed the methods recommended by Hans-Hermann Hoppe. That is, it should have been done in a decentralized and piecemeal fashion. However, such efforts would have required the Scots to abandon their welfare state.


October 1, 2014, 11:33 pm, 1344703
On Tuesday evening, Argentine President Cristina Fernández accused Juan Carlos Fábrega, head of Argentina’s central bank, of "provoking a devaluation of the peso".

In response Head of Argentine Central Bank Quits.

Without naming Mr Fábrega directly, Ms Fernández accused the central bank during a nationwide ...


October 1, 2014, 11:33 pm, 1344702

There’s been a lot of attention paid recently to the issue of “campus sexual assaults” and some of the media including Katie Couric, the Washington Post, the Associated Press, and MSNBC, along with ...


October 1, 2014, 10:34 pm, 1344686
Teaser:

I ...


October 1, 2014, 10:04 pm, 1344682
(Don Boudreaux)

For reasons mysterious to me, this past week has brought an unusual number – eight all told – of e-mails challenging me to defend free trade (as one of these e-mailers says) “in face of the fact that China and other [foreign] governments grant steep subsidies to their ...


October 1, 2014, 9:03 pm, 1344677
An interesting article on foreign buyers of U.S. real estate from Dionne Searceyoct at the NY Times: Indians Join the Wave of Investors in Condos and Homes in the U.S.

Foreign buyers now make up 7 percent of total existing-home sales ... Of those, Indians represent 6 percent of ...


October 1, 2014, 8:44 pm, 1344674

As routine tasks are increasingly automated, middle-wage jobs are becoming rarer. This column documents the changes in labour-market dynamics behind polarisation, and investigates which workers are affected by it. Flows into middle-wage routine jobs are declining (rather than flows out increasing). Interestingly, routine cognitive workers – who tend to be ...


October 1, 2014, 8:44 pm, 1344676

Many Japanese municipalities found recent population predictions for the next 30 years rather alarming. Unfortunately, most of them do not have an effective solution to the declining population problem. This column discusses different strategies that could ignite innovation and stimulate the growth of the population. Bringing in new business, identifying ...


October 1, 2014, 8:44 pm, 1344675

Numerous countries have implemented seat reservations for women in politics over the past decades. Starting in the early 1990s, India’s flagship decentralisation reform instituted one-third seat reservations for women in local governance bodies. This column suggests that this political empowerment increased women’s economic empowerment through at least one channel, i.e. ...


October 1, 2014, 8:05 pm, 1344672

Well, she didn’t actually say that, but she might as well have. Her position is that the investors who loaned her regime money are now “terrorists” for wanting to be repaid, noting, in a speech at the United Nations, that ...


October 1, 2014, 8:04 pm, 1344671
(Don Boudreaux)

Sheldon Richman explains that freedom does not require empire; in fact, quite the opposite.  (HT Walter Grinder)  A slice:

We’ve had enough experience with government to know that even well-intended policies will likely be turned to the benefit of special interests (“free-trade imperialism”) and that the people most ...


October 1, 2014, 7:33 pm, 1344669
In the inequality post, I puzzled over the following conundrum:

Why does it matter at all to a vegetable picker in Fresno, or an unemployed teenager on the south side of Chicago, whether 10 or 100 hedge fund managers in Greenwich have private jets? How do they ...


October 1, 2014, 7:33 pm, 1344670
In my inequality post, I wrote, somewhat speculatively,

The returns to education chosen and worked hard for are not necessarily replicated in education subsidized or forced.

Marginal Revolutionpoints to a nice new paperby Pierre Mouganie making this point. From the abstract:

In 1997, ...


October 1, 2014, 7:33 pm, 1344668
The photo below was taken at a University of Chicago Econ softball game back in 1991. You should recognize two Nobel Laureates and a likely future laureate (not me). If you look carefully, you will also see faculty members of the University of Chicago, University of Minnesota, Brandeis University and ...


October 1, 2014, 7:33 pm, 1344667

1. September Auto Sales. Vehicle sales this year of 16.34 million units on a seasonally adjusted, annual rate (SAAR) was the September sales month since 2006, when 16.42 million units were sold.

2. Restaurant Sales. Driven by stronger same-store sales and customer traffic levels and a more optimistic outlook among ...


October 1, 2014, 7:03 pm, 1344639
The Case-Shiller house price indexes for July were released yesterday. Zillow has started forecasting Case-Shillera month early - and I like to check the Zillow forecasts since they have been pretty close. Note: Hopefully Zillow will start estimating the National Index.

From Zillow: Find Out Next ...


October 1, 2014, 6:44 pm, 1344638
A


October 1, 2014, 6:44 pm, 1344637
A


October 1, 2014, 6:44 pm, 1344636

Ronald McKinnon, a prolific and pioneering international economist, died today of complications from a fall he suffered at San Francisco's airport 12 days ago. The news come from John Shoven at Stanford University, where Mr McKinnon had been a professor since 1961.

McKinnon wrote extensively over his career about exchange ...


October 1, 2014, 6:05 pm, 1344635

Alan Greenspan once vigorously defended the gold standard, before taking command of the world’s largest printing press. Now back in civilian life, and lacking any opportunity to put his professed principles into action, Alan is once more friendly to gold:

The ...


October 1, 2014, 5:33 pm, 1344633


October 1, 2014, 5:33 pm, 1344632

The Wall Street Journal’s Jon Hilsenrath makes the case for former Fed Chairman Ben Bernanke as the next recipient for the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel:

Mr. Bernanke’s 1990s “financial accelerator” papers with New York University professor Mark Gertler and Simon Gilchrist presciently ...


October 1, 2014, 5:33 pm, 1344631

From “The Happiness Trade-Off between Unemployment and Inflation” by David Blanchflower, David Bell, Alberto Montagnoli, and Mirko Maro

Unemployment and inflation lower well-being. The macroeconomist Arthur Okun characterized the negative effects of unemployment and inflation by the misery index—the sum of the unemployment and inflation rates. This paper makes use ...


October 1, 2014, 5:33 pm, 1344630

From Isabel Sawhill of Brookings:

1.) Major demographic trends, once they gain a certain momentum, are hard to reverse.

2.) The youngest generation is marrying less than older ones, suggesting this is the wave of the future.

3.) Groups with low marriage rates (minorities) are becoming a larger share ...


October 1, 2014, 5:33 pm, 1344629

As Europe’s economy now appears to be heading for a triple-dip recession and as its politics continue to fragment at a seemingly accelerating pace, European policymakers would be well advised to ask themselves two basic questions. First, if a recipe of fiscal austerity and structural economic reform within a Euro ...


October 1, 2014, 5:03 pm, 1344590

Last year, Washington State offered $9 billion in tax incentives to Boeing in order to bring the aerospace manufacturer’s 777X production line to the state, thereby creating high-paying jobs that would benefit Washingtonians. But despite the state’s best efforts, Boeing has announced its third large employment reduction ...


October 1, 2014, 5:03 pm, 1344588

A rise in the pound last year has helped keep a lid on inflation in the U.K. but that effect may soon start to fade, one of the Bank of England‘s top policy makers said Wednesday.


October 1, 2014, 5:03 pm, 1344589

NAPLES–European Central Bank President Mario Draghi used Hercules to illustrate the challenges facing European policymakers to get the eurozone economy out of its doldrums.

“As policymakers in Italy and in the euro area, it often feels like we face a Herculean task to revive growth and bring down unemployment,” he ...


October 1, 2014, 4:44 pm, 1344586
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October 1, 2014, 4:44 pm, 1344587
A


October 1, 2014, 4:44 pm, 1344585
A


October 1, 2014, 4:04 pm, 1344583
¯\_(ツ)_/¯ Back in April, I wrote that the Dow Jones would rise to 16,800 and then revolve around that point and then eventually come down from there. “My view now is that the Dow Jones will make a publicity effort with hopes to get back up to 16800, then come ...


October 1, 2014, 3:33 pm, 1344581

It turns out that that Federal Finance Minister Joe Oliver is reported as saying that “the government can shrink the national debt by growing the economy and ‘without actually paying off any debt’.” At the same time, as part of pre–budgetary consultations with the finance committee, ...


October 1, 2014, 3:33 pm, 1344580
In a Time Magazine Op-Ed, Congressman Charles Rangel (Democrat from New York), a combat veteran says It’s Time for a War Tax and a Reinstated Draft.

While I am optimistic about our Commander-in-Chief’s strategy to defeat the Islamic State of Iraq and Syria, I voted against ...


October 1, 2014, 3:33 pm, 1344579

Bard College economist Pavlina Tcherneva has cooked up a frightening and much-shared income-inequality chart (see above) — “the most important chart about the American economy you’ll see this year,” according to Vox —  that seems to confirm the worst: America has become a winner-take-everything society. Since the 1980s, ...


October 1, 2014, 3:33 pm, 1344578

1. Here’s what you can buy in Flint, Michigan for $425,000 (pictured above):

Gorgeous historic home in Flint’s most prestigious neighborhood! Impressive marble Foyer, beautiful hardwood floors throughout, crown molding, paneled Library with french doors. Huge master suite with cozy ...


October 1, 2014, 3:03 pm, 1344518

As nationwide political momentum for marijuana legalization grows stronger, a recent estimate shows potential revenue from a marijuana taxes could result in an approximately $3 billion increase in available state funds. Although the general underpinning of the estimate, published by NerdWallet, has been subject to


October 1, 2014, 3:03 pm, 1344517

One of the strange quirks in the U.S. government’s “Buy American” laws is that many items covered by the rules—from hand tools to trolley cars—wouldn’t necessarily be able to carry a “Made in USA” label if found on a store shelf.

The Buy American Act, for instance, around since the Great ...


October 1, 2014, 3:03 pm, 1344516

I'm not so sure that the solution to Americans working "strange hours" is "to revert to the shop-closing laws (Blue Laws) that prevailed in the US years ago." What do you think?:

Americans work too long (and too often at strange times), by Daniel S. Hamermesh, Elena Stancanelli, Vox EU: ...


October 1, 2014, 3:03 pm, 1344515
Reis released their Q3 2014 Office Vacancy survey this morning. Reis reported that the office vacancy rate was unchanged in Q3 compared to Q2 at 16.8%. This is down slightly from 16.9% in Q3 2013, and down from thecycle peak of 17.6%.

From Reis Senior Economist Ryan Severino:


October 1, 2014, 3:03 pm, 1344514
Based on an WardsAuto estimate, light vehicle sales were at a16.34 million SAAR in September. That is up 7% from September 2013, but down 6% from the 17.4 million annual sales rate last month.

This was below the consensus forecast of 16.8 million SAAR (seasonally adjusted annual rate).


October 1, 2014, 2:05 pm, 1344513

October 1, 2014, 2:05 pm, 1344512

Jon Hilsenrath says Bernanke deserves one, I agree.  I would gladly see a Bernanke-Woodford-Svensson prize, perhaps working in Mark Gertler too.

But for this year’s pick, due October 13, I am predicting William J. Baumol, possibly with William G. Bowen, for work on ...


October 1, 2014, 2:04 pm, 1344511
I’m reprising a previous (and longer) post here in hopefully simplified and clarified form, for a discussion I’m in the midst of. “Saving” and “Savings” seem like simple concepts, but they’re not. They have many different meanings, and writers’ different usages and definitions (often implicit or even unconscious) make coherent understanding and ...


October 1, 2014, 1:03 pm, 1344474

In July, the DC Council approved a major tax reform that cuts income and business taxes, expands the low-income tax credit, and applies sales tax to items exempt by historical accident, all based on the recommendations of a blue-ribbon commission. Effective today, consumers must pay the 5.75 percent sales ...


October 1, 2014, 1:03 pm, 1344472

Unemployment is much more damaging to society than moderate levels of inflation, making central bankers’ disproportionate focus on the level of consumer price growth misguided, a former Bank of England rate-setter now at Dartmouth College writes in a new paper.

Along with three co-authors, David Blanchflower, known for his ...


October 1, 2014, 1:03 pm, 1344473

Nigeria’s finance minister Ngozi Okonjo-Iweala says the Ebola virus is having a negligible impact on her country’s economy, but the Boko Haram insurgency is eroding growth prospects.

Agence France-Presse/Getty Images

“We’re ...


October 1, 2014, 1:03 pm, 1344470
Associated Press

The European Central Bank is expected to refrain from new stimulus measures when it meets Thursday in Naples, Italy and instead focus on implementing a new, private-asset purchase program that was part of September’s stimulus ...


October 1, 2014, 1:03 pm, 1344471

The glass ceiling is still there, but it’s getting thinner.

A trio of economists, wielding big data from Social Security’s records, says that in 1981-85, women constituted just 1.9% of the top 0.1% of earners (based on average earnings for those years) and 5.2% of the top 1%.


October 1, 2014, 1:03 pm, 1344469

Nearly a quarter of metropolitan areas had fewer jobs in August than five years earlier, showing that the national labor market recovery has missed broad swaths of the U.S.

According to Labor Department data released Wednesday, 92 regions have experienced net job loss since August 2009 despite the country steadily ...


October 1, 2014, 1:03 pm, 1344468

Jared Bernstein says there's more slack in the labor market than you'd think from just looking at the unemployment rate:

...So why not just look at the unemployment rate and call it a day? Because special factors in play right now make the jobless rate an inadequate measure of ...


October 1, 2014, 1:03 pm, 1344467



[From Brookings]

The fiscal impact measure shows how much federal, state, and local government taxes and spending added to or subtracted from the ...


October 1, 2014, 1:03 pm, 1344466

From Chapter 4 of the IMF’s World Economic Outlook, released today:

Global current account (“flow”) imbalances have narrowed significantly since their peak in 2006, and their configuration has changed markedly in the process. The imbalances that used to be ...


October 1, 2014, 12:44 pm, 1344465
Looked at one way, economic ties between the U.S. and India have expanded greatly. But huge opportunities remain on both sides.


October 1, 2014, 12:44 pm, 1344464
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October 1, 2014, 12:44 pm, 1344463
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October 1, 2014, 12:05 pm, 1344457

The September issue of The Free Market, the Mises Institute’s monthly,  is now online!

September’s issue features a new book review from David Gordon, and on the 100th anniversary of World War I, Hunt Tooley reflects on modern views of the war:

In his ...


October 1, 2014, 12:05 pm, 1344459

Lots of people like to concentrate on the deficit when looking at public finances. In 2013, he federal government of the United States ran a budget deficit of $614 billion, which is quite a bit, but seemingly small relative to the ...


October 1, 2014, 12:05 pm, 1344460

Mises Daily Wednesday by Dick Clark:

2014’s new US Farm Bill eliminates many direct subsidies to farmers, while replacing them with subsidized insurance programs. This will lead to higher costs for taxpayers and distorted markets in the future.


October 1, 2014, 12:05 pm, 1344458

Well, war is good for certain sectors of the economy. For example: weapons manufacturing. Taxpayers and holders of US dollars won’t fare quite as well.

Writes Bloomberg:

Led by Lockheed Martin Corp. (LMT), the biggest U.S. defense companies are trading at record prices as shareholders ...


October 1, 2014, 12:05 pm, 1344456

This is perhaps today’s underreported news story:

Catalonia’s regional government said Tuesday it was suspending its promotion of an independence referendum, a day after a decision by Spain’s Constitutional Court blocking the nonbinding vote.

Catalonia’s leaders still hoped to hold the vote on Nov. 9, said spokesman Francesc ...


October 1, 2014, 12:04 pm, 1344455

For all of you high achievers out there, your workplace is probably the largest single place that you spend time in. While there have been some wacky theories over the years as to what type of office surroundings make more productive, when ...


October 1, 2014, 12:04 pm, 1344454
Banks are obviously different from households. But I think explaining two key differences goes far towards explaining why “endogenous money” theory — often pooh poohed as either confused or obvious — is important to economic thinking. The first is a dweeby accounting difference. The other, which arises from that, is very, ...


October 1, 2014, 11:33 am, 1344452

The Council of Graduate Schools (CGS) recently released its annual report recently on US graduate school enrollment and degrees for 2013, and here are some of the more interesting findings in ...


October 1, 2014, 11:23 am, 1344451
If you are one of the thousands of drivers who has just spent up to 13 hours online, trying to renew your car tax, you may not find this quiz so entertaining. However, for the rest of us, the BBC have a quiz about some of the changes to finances ...


October 1, 2014, 11:03 am, 1344384
Former Treasury Secretary Lawrence Summers delivers remarks during the 2014 annual conference of the Export-Import Bank in April in Washington. Getty Images

The U.S. government over time ...


October 1, 2014, 11:03 am, 1344385

U.S. workers who have been out of a job for six months or longer can and will reenter the labor market as the unemployment rate falls further, according to a new paper countering arguments that the long-term jobless are increasingly unemployable due to an erosion of skills.

That doesn’t mean that


October 1, 2014, 11:03 am, 1344383

The European Central Bank must be wondering when it will catch a break.

On Monday, surveys published by the European Commission showed it was at risk of losing its battle to persuade consumer and households that the inflation rate will soon start to pick up, and edge towards its target over ...


October 1, 2014, 11:03 am, 1344382

The Federal Reserve should continue to act fully independently from the U.S. Treasury even in times of crisis, Fed Gov. Jerome Powell said Tuesday in response to calls for closer cooperation between the two bodies in a Brookings Institution paper.

The research, of which former Treasury Secretary Lawrence Summers is a ...


October 1, 2014, 11:03 am, 1344386

Bank of Japan officials are losing their hopes for a quick rebound of the economy, their confidence further shaken by a slew of poor indicators released on Tuesday, according to people familiar with the central bank’s thinking.

While the BOJ’s policy board isn’t expected to decide on any additional measures ...


October 1, 2014, 11:03 am, 1344388

Brazilians face many options in the Oct. 5 vote, but for economists and investors the options are clear: It is reform or die.

Some economists say that even if incumbent ...


October 1, 2014, 11:03 am, 1344390
Pedestrians walk past advertisements for property at an estate agents office in Beijing. Bloomberg News

Just how much will a downturn in China’s property market hurt the ...


October 1, 2014, 11:03 am, 1344381

The S&P Case-Shiller national home price index is up just 5.6% in the year ended in July, continuing a slowing trend since late 2013.

Las Vegas was one of just ...


October 1, 2014, 11:03 am, 1344389
Japan’s industrial output unexpectedly fell 1.5% in August. Bloomberg News

A raft of economic data released Tuesday continues to paint a picture of sluggish growth for ...


October 1, 2014, 11:03 am, 1344387

The Wall Street Journal’s Daily Report on Global Central Banks for Tuesday, September 30, 2014:

Sign up for the newsletter.

Highlights

Hilsenrath’s Take: Report Points to Downsides of Fed’s Consensus Culture Fed Rate Policies Aid Foreign ...


October 1, 2014, 11:03 am, 1344372

October 1, 2014, 11:03 am, 1344380

Household incomes in the Plains states are booming.

Nebraska and North Dakota posted the strongest income growth in the second quarter among all 50 states. Overall incomes—reflecting what Americans earn in salary, rental income and government assistance—grew a seasonally adjusted 2.7% in those states in the spring, Commerce Department data show.

Incomes ...


October 1, 2014, 11:03 am, 1344373
A young boy works on a computer in a convenience store in Beijing. Agence France-Presse/Getty Images

Steady and slow expansion of China’s economic activity might be what ...


October 1, 2014, 11:03 am, 1344371

Nigeria’s finance minister Ngozi Okonjo-Iweala says the Ebola virus is having a negligible impact on her country’s economy, but the Boko Haram insurgency is eroding growth prospects.

Agence France-Presse/Getty Images

“We’re ...


October 1, 2014, 11:03 am, 1344375

The cross-currents of the global economy leave the world’s central banks confronting varied policy choices in the months ahead. The U.S. and U.K. recoveries finally have enough momentum for the Federal Reserve and Bank of England to anticipate raising raise short-term interest rates from record lows next year. The European ...


October 1, 2014, 11:03 am, 1344374
Five takeaways from a surprisingly positive Bank of Japan tankan survey of business sentiment that will likely lessen pressure on the central bank to take further action.


October 1, 2014, 11:03 am, 1344376

The time might be approaching for the U.S. Treasury to rethink its strategy of issuing more long-term debt relative to short-term debt, a former senior U.S. Treasury official said Tuesday.

The Treasury has been lengthening the average maturity of the debt it issues for several years. At 68.4 months as of ...


October 1, 2014, 11:03 am, 1344379

A top Bank of England policy maker said Tuesday he doesn’t think that providing more explicit guidance on the future path of interest rates in the U.K. would be a very good idea.

David Miles, one of nine rate-setters on the BOE’s Monetary Policy Committee, said in a speech at the ...


October 1, 2014, 11:03 am, 1344378

China’s devalued exchange rate has made it a pariah of U.S.-based manufacturing and a beloved target of countless U.S. political diatribes and bills seeking to censure Beijing for its currency policy.

But it is key U.S. ally Germany that’s sapping growth from the global economy, according to the latest ...


October 1, 2014, 11:03 am, 1344377

Infrastructure investment is the antidote to serial disappointments in global growth.

That’s what the International Monetary Fund is touting ahead of a gathering of top finance officials from around the world.

Especially for advanced economies, infrastructure investment “is one of the few remaining policy levers available to support growth, given ...


October 1, 2014, 11:03 am, 1344370
The ISM manufacturing index suggests slower expansion in September than in August. The PMI was at 56.6% in September, down from 59.0% in August. The employment index was at 54.6%, down from 58.1% in August, and the new orders index was at 60.0%, down from 66.7%.

From the ...


October 1, 2014, 11:03 am, 1344369
Earlier the Census Bureau reported that overall construction spending decreased in August:

The U.S. Census Bureau of the Department of Commerce announced today that construction spending during August 2014 was estimated at a seasonally adjusted annual rate of $961.0 billion, 0.8 percent below the revised July estimate of $968.8 ...


October 1, 2014, 10:44 am, 1344368
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October 1, 2014, 10:35 am, 1344367
Private-sector employment continued to rise at a moderate pace in September, according to this morning’s ADP Employment Report. Last month’s 213,000 increase in jobs (seasonally adjusted) was slightly higher than the consensus forecast, but generally in line with the pace … Continue reading →


October 1, 2014, 10:35 am, 1344366

A lot has been written about the failures of economics, some of it worth reading. However, as far as I know, nobody has pointed out that pretty much all of us - me, Simon Wren-Lewis, the Adam Smith Institute and all - make a systematic error in thinking ...


October 1, 2014, 10:04 am, 1344363
(Don Boudreaux)

… is from page 109 of Michael Huemer’s insightful and powerful 2013 book, The Problem of Political Authority:

Respect for authority was Hitler’s key weapon.  The same is true of all the greatest man-made evils.  No one has ever managed, working alone, to kill over a million people.  Nor ...


October 1, 2014, 10:04 am, 1344362
by New Deal democrat         (re-posted with permission from Bondadd blog) Sadly, Ed Yardeni is the Wanker of the Day – wage stagnation edition Dr. Ed Yardeni has some clickbait up at his blog titled, The Wage Stagnation Myth. Yardeni is a highly-regarded financial markets analyst, but this ...


October 1, 2014, 9:33 am, 1344356
The IMF endorses the free-lunch view of infrastructure spending.That is, an IMFstudy suggests that the expansionary effects are sufficiently large that debt-financed infrastructure spending could reduce the debt-GDP ratio over time.

Certainly this outcome is theoretically possible (just like self-financing tax cuts), butyou can count me asskeptical ...


October 1, 2014, 9:03 am, 1344294

October 1, 2014, 9:03 am, 1344293
From ADP:

Private sector employment increased by 213,000 jobs from August to September according to the August ADP National Employment Report®. ... The report, which is derived from ADP’s actual payroll data, measures the change in total nonfarm private employment each month on a seasonally-adjusted basis.
...


October 1, 2014, 8:45 am, 1344292
Looked at one way, economic ties between the U.S. and India have expanded greatly. But huge opportunities remain on both sides.


October 1, 2014, 8:35 am, 1344291
September was a complete rout. All the major asset classes suffered losses last month—the first calendar month of across-the-board red ink since June 2013. At the top of the casualty list: emerging-market stocks (MSCI EM), which tumbled 7.4% in September. … Continue reading →


October 1, 2014, 8:04 am, 1344288
by Dale Coberly VERY SHORT POST ON SOCIAL SECURITY DISABILITY INSURANCE WITH A SURPRISE ENDING The Committee for a Responsible Federal Budget has issued a “call for papers” with suggestions for “fixing” SSDI. I expect that by “fixing” they mean cutting people off and getting them back to work. After ...


October 1, 2014, 7:33 am, 1344284

Steven Pinker smacks some of the more egregious problems in "academese".

Enough already. Our indifference to how we share the fruits of our intellectual labors is a betrayal of our calling to enhance the spread of knowledge. In writing badly, we are wasting each other’s time, sowing ...


October 1, 2014, 7:33 am, 1344283

A comfort in my old age.

Roger Ekrich noticed many old books, including Chaucer's "The Canterbury Tales", referencedtwo periods of sleepbeing the norm in their era.


October 1, 2014, 7:33 am, 1344282

You can have my Oxford comma when you pry my cold, dead hands from it.


October 1, 2014, 7:33 am, 1344281

Needless to say, bring it on!

Imperial College has discovered how to turn off an enzyme which is driving many incurable diseases.

The NMT enzyme makes irreversible changes to proteins which stop damaged cells from dying and, instead, speeds up their replication, causing cancer.


October 1, 2014, 7:33 am, 1344280
Claudia M. Buch, James Chapman, and Linda Goldberg

Over the past thirty years, the typical large bank has become a global entity with subsidiaries in many countries. In parallel, financial liberalization has increased the interconnectedness of banking systems, with domestic banking systems becoming more exposed to ...


October 1, 2014, 7:23 am, 1344279
THE LATEST fiasco at Tesco could prove an embarrassment for more than just the retailer. There appears to have been an over-recording of profit of some £250m, and some are asking questions about the company’s auditors.


October 1, 2014, 7:23 am, 1344278
Two hundred and fifty students at University College London (UCL) start learning economics in a new way today, Wednesday 1 October.


October 1, 2014, 7:23 am, 1344275

This is a list of the gross National debt that countries have. National debt refers to the amount of total government debt a country has. This is also referred to as ‘public sector debt’. It is compiled using data from the IMF, ...


October 1, 2014, 7:23 am, 1344277
We've got another fantastic interactive quiz format for you. This one will help test how much your students have taken in over these first few weeks of the AS course. This activity called 'Four Words' shows students the first four words of a definition of a key phrase. Students must ...


October 1, 2014, 7:23 am, 1344276

External debt is the total  public (government) and private debt owed to non-residents repayable in internationally accepted currencies, goods, or services. This is gross (total) external debt. It does not measure net debt.

External debt is different to measures of public (government) debt. See: List of national debt by country.

Some ...


October 1, 2014, 7:03 am, 1344236
A young boy works on a computer in a convenience store in Beijing. Agence France-Presse/Getty Images

Steady and slow expansion of China’s economic activity might be what ...


October 1, 2014, 7:03 am, 1344235

October 1, 2014, 7:03 am, 1344234
From the MBA: Mortgage Applications Decrease Slightly in Latest MBA Weekly Survey

Mortgage applications decreased 0.2 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 26, 2014. ...

The Refinance Index decreased 0.3 percent ...


October 1, 2014, 6:44 am, 1344233
A


October 1, 2014, 5:24 am, 1344229

Photo Credit: Michael Daddino

I am mystified at why people might be outraged or surprised that the Federal Reserve does a poor job of overseeing banks.  The Fed is an overstaffed bureaucracy.  Overstaffed bureaucracies always tend toward consensus ...


October 1, 2014, 5:23 am, 1344228

Readers Question: Is it possible for a country to completely pay off its national debt?

Yes. A country with an easy source of tax (e.g. oil rich Middle-East countries) could easily run a budget surplus and buy back any previous government bonds.

It ...


October 1, 2014, 5:03 am, 1344166
A young boy works on a computer in a convenience store in Beijing. Agence France-Presse/Getty Images

Steady and slow expansion of China’s economic activity might be what ...


October 1, 2014, 5:03 am, 1344165

Did you know that if you're willing to defer collecting retirement benefits from Social Security, you can actually ...


October 1, 2014, 5:03 am, 1344164

October 1, 2014, 4:04 am, 1344163
A


October 1, 2014, 3:03 am, 1344118

Bank of Japan officials are losing their hopes for a quick rebound of the economy, their confidence further shaken by a slew of poor indicators released on Tuesday, according to people familiar with the central bank’s thinking.

While the BOJ’s policy board isn’t expected to decide on any additional measures ...


October 1, 2014, 3:03 am, 1344116
Former Treasury Secretary Lawrence Summers delivers remarks during the 2014 annual conference of the Export-Import Bank in April in Washington. Getty Images

The U.S. government over time ...


October 1, 2014, 3:03 am, 1344119

The Wall Street Journal’s Daily Report on Global Central Banks for Tuesday, September 30, 2014:

Sign up for the newsletter.

Highlights

Hilsenrath’s Take: Report Points to Downsides of Fed’s Consensus Culture Fed Rate Policies Aid Foreign ...


October 1, 2014, 3:03 am, 1344117

U.S. workers who have been out of a job for six months or longer can and will reenter the labor market as the unemployment rate falls further, according to a new paper countering arguments that the long-term jobless are increasingly unemployable due to an erosion of skills.

That doesn’t mean that


October 1, 2014, 3:03 am, 1344124
Japanese Prime Minister Shinzo Abe at the U.N. Climate Summit in New York, Sept 23. Reuters

Faced with a drop in demand after an April sales tax ...


October 1, 2014, 3:03 am, 1344115

The European Central Bank must be wondering when it will catch a break.

On Monday, surveys published by the European Commission showed it was at risk of losing its battle to persuade consumer and households that the inflation rate will soon start to pick up, and edge towards its target over ...


October 1, 2014, 3:03 am, 1344123
A row of newly constructed homes selling in the new Sydney suburb of Greenhills Beach Reuters

SYDNEY–Australia’s central bank and banking regulator are on course to announce ...


October 1, 2014, 3:03 am, 1344121
Japan’s industrial output unexpectedly fell 1.5% in August. Bloomberg News

A raft of economic data released Tuesday continues to paint a picture of sluggish growth for ...


October 1, 2014, 3:03 am, 1344120

Brazilians face many options in the Oct. 5 vote, but for economists and investors the options are clear: It is reform or die.

Some economists say that even if incumbent ...


October 1, 2014, 3:03 am, 1344122
Pedestrians walk past advertisements for property at an estate agents office in Beijing. Bloomberg News

Just how much will a downturn in China’s property market hurt the ...


October 1, 2014, 3:03 am, 1344114

The Federal Reserve should continue to act fully independently from the U.S. Treasury even in times of crisis, Fed Gov. Jerome Powell said Tuesday in response to calls for closer cooperation between the two bodies in a Brookings Institution paper.

The research, of which former Treasury Secretary Lawrence Summers is a ...


October 1, 2014, 3:03 am, 1344107

The cross-currents of the global economy leave the world’s central banks confronting varied policy choices in the months ahead. The U.S. and U.K. recoveries finally have enough momentum for the Federal Reserve and Bank of England to anticipate raising raise short-term interest rates from record lows next year. The European ...


October 1, 2014, 3:03 am, 1344106
Five takeaways from a surprisingly positive Bank of Japan tankan survey of business sentiment that will likely lessen pressure on the central bank to take further action.


October 1, 2014, 3:03 am, 1344109

Infrastructure investment is the antidote to serial disappointments in global growth.

That’s what the International Monetary Fund is touting ahead of a gathering of top finance officials from around the world.

Especially for advanced economies, infrastructure investment “is one of the few remaining policy levers available to support growth, given ...


October 1, 2014, 3:03 am, 1344108

The time might be approaching for the U.S. Treasury to rethink its strategy of issuing more long-term debt relative to short-term debt, a former senior U.S. Treasury official said Tuesday.

The Treasury has been lengthening the average maturity of the debt it issues for several years. At 68.4 months as of ...


October 1, 2014, 3:03 am, 1344113

The S&P Case-Shiller national home price index is up just 5.6% in the year ended in July, continuing a slowing trend since late 2013.

Las Vegas was one of just ...


October 1, 2014, 3:03 am, 1344112

Household incomes in the Plains states are booming.

Nebraska and North Dakota posted the strongest income growth in the second quarter among all 50 states. Overall incomes—reflecting what Americans earn in salary, rental income and government assistance—grew a seasonally adjusted 2.7% in those states in the spring, Commerce Department data show.

Incomes ...


October 1, 2014, 3:03 am, 1344111

A top Bank of England policy maker said Tuesday he doesn’t think that providing more explicit guidance on the future path of interest rates in the U.K. would be a very good idea.

David Miles, one of nine rate-setters on the BOE’s Monetary Policy Committee, said in a speech at the ...


October 1, 2014, 3:03 am, 1344110

China’s devalued exchange rate has made it a pariah of U.S.-based manufacturing and a beloved target of countless U.S. political diatribes and bills seeking to censure Beijing for its currency policy.

But it is key U.S. ally Germany that’s sapping growth from the global economy, according to the latest ...


October 1, 2014, 2:05 am, 1344105

I see a whole bunch of candidates here, each backed by a broadly plausible psychological story:

1. They are more ruthless than we realize.

2. They are more like us than we realize.

2b. #1 and #2.

3. They have longer time horizons than we imagine.

4. Due to extreme political constraints, they have far ...


October 1, 2014, 1:03 am, 1344092
Five takeaways from a surprisingly positive Bank of Japan tankan survey of business sentiment that will likely lessen pressure on the central bank to take further action.


October 1, 2014, 12:44 am, 1344091
A


October 1, 2014, 12:44 am, 1344090

This week's episode was a conversation with University of Chicago philosopher Martha Nussbaum. She and EconTalk host Russ Roberts discussed her work on the capabilities approach, the limits of GDP, stoicism, and the value of philosophy.

We'd like to hear your reaction to their conversation. As always, our goal is ...


October 1, 2014, 12:34 am, 1344089

2014’s new US Farm Bill eliminates many direct subsidies to farmers, while replacing them with subsidized insurance programs. This will lead to higher costs for taxpayers and distorted markets in the future.


October 1, 2014, 12:05 am, 1344087

Emily Wax-Thibodeaux reports:

The new supervisor thought his idea was innocent enough. He wanted the baristas to write the names of customers on their cups to speed up lines and ease confusion, just like other Starbucks do around the world.

But these aren’t just any customers. They are regulars at ...


October 1, 2014, 12:04 am, 1344086
(October 1, 2014 12:05 AM, by Bryan Caplan) I've long believed that human beings are overly touchy. Many actively look for excuses to take offense. This excess negativity isn't just unpleasant. Due to the scarcity of attention and patience, unreasonable offense frequently crowds out reasonable offense. It's no... (1 ...


October 1, 2014, 12:04 am, 1344085
(Don Boudreaux)

“G. Pyle” – who describes himself or herself as “a darn reg’lar” Cafe patron – points out to me by e-mail that the Quotation of the Day from exactly three years ago, one from the great Harold Demsetz, is relevant to today’s earlier letter to Paul Krugman.


October 1, 2014, 12:04 am, 1344084
(Don Boudreaux)

Intrigued by G. Pyle pointing me to a Cafe Hayek post of exactly three years ago, I went – just out of curiosity – to see what was posted at the Cafe exactly ten years ago today.  Here’s the last of three Cafe posts from September ...