Economics Roundtable

Technical Problems 3/9/15

The website was down several hours today, but is back up now.


May 2014 Payroll Employment

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

Click on the image to get a bigger version.


Jobs

The best summary of the state of our economy is the graph (below) of employment as a fraction of population for people over 16 years old. The decrease is large, but the most troubling feature of the graph is the flat trend .


Click on the image to get a bigger version.


Graph-of-the-Year Candidates

Donald Marron likes European interest rates. Click on the image to get a bigger version. Can you find three distinct subperiods?

Brad DeLong favors the U.S. gdp gap.


Remember M1?

Money Supply M1 growth is now over 20% per year over a 12 month lag. M1 growth has touched 20% before, but not with excess reserves of $1.6 trillion. Where is M1 headed?


Click on the chart for a larger version.


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June 30, 2015, 9:33 pm, 1499674

From Reason.tv:

What now gets labeled feminism on [college] campuses,” says Northwestern University Professor Laura Kipnis, “has to do with dialing back a lot the progress women have made establishing ourselves as consenting adults.”

That was the main argument of an essay Kipnis published this past February ...


June 30, 2015, 9:03 pm, 1499659

Federal Reserve Bank of St. Louis President James Bullard said Tuesday Greek economic problems are unlikely to affect the U.S., leaving the Fed on track for rate rises later this year.

What’s happening in Europe “would not change the timing of any rate hike. I would say September is still very ...


June 30, 2015, 8:44 pm, 1499658
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June 30, 2015, 8:44 pm, 1499657

Since 2004, 12 Catholic dioceses have filed under Chapter 11. The latest case is that of the Archdiocese of St. Paul and Minneapolis, which filed in January 2015. The claims bar date is set for August 3. How should the Archdiocese go about notifying potential claimants -- clergy ...


June 30, 2015, 8:04 pm, 1499654
The Wall Street Journal just published news that Greece defaulted on its IMF loan. Link I have connections to some people in the banking industry who have said for years that Greece’s default was inevitable. Now the default looks like it is here.


June 30, 2015, 8:04 pm, 1499653

The Energy Information Administration released monthly oil production today for April and here are some of the highlights of that report:

1. Despite low oil prices that averaged $54.45 per barrel in April, US oil production topped 9.7 million barrels per day (bpd) ...


June 30, 2015, 7:33 pm, 1499652

The Energy Information Administration released monthly oil production today for April and here are some of the highlights of that report:

1. Despite low oil prices that averaged $54.45 per barrel in April, US oil production topped 9.7 million barrels per day (bpd) ...


June 30, 2015, 7:03 pm, 1499607

With a veto threat looming over their heads, Pennsylvania legislators adopted a $30.2 billion budget that eschews tax increases. A $1.2 billion increase in spending over last year’s budget—largely to cover rising pension obligations—relies heavily on the use of a present surplus and other one-time revenue transfers, along ...


June 30, 2015, 7:03 pm, 1499606

Yesterday, the governor of Puerto Rico announced that his government’s $72 billion of debts are not payable, in advance of $1.92 billion in debt service payments due on Wednesday. This announcement follows over a year and a half of uncertainty about Puerto Rico’s ability to meet ...


June 30, 2015, 7:03 pm, 1499605

ST. LOUIS–Federal Reserve Bank of St. Louis President James Bullard warned Tuesday that very low interest rates could create problems in the financial system, and suggested that in the future the U.S. central bank may need to set short-term rates at higher levels than would normally be the case to ...


June 30, 2015, 7:03 pm, 1499604
Statement by the IMF on Greece

Press Release No.15/310
June 30, 2015
Mr. Gerry Rice, Director of Communications at the International Monetary Fund (IMF), made the following statement today regarding Greece’s financial obligations to the IMF due today:

“I confirm that the SDR 1.2 billion repayment (about ...


June 30, 2015, 6:45 pm, 1499603

Grexit and the reintroduction of the drachma would have severe consequences for the Greek people. This column argues, based on Argentina's experience, that this would produce a sharp devaluation of the drachma, inflation, and a severe reduction in real wages and pensions. The effects would be far worse than the ...


June 30, 2015, 6:45 pm, 1499602
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June 30, 2015, 6:34 pm, 1499601
Teaser:

The ...


June 30, 2015, 6:04 pm, 1499599
(Don Boudreaux)

Mr. Bob Keener
Business for a ...


June 30, 2015, 5:33 pm, 1499597

There is general support among the public for legislated, government-mandated minimum wages for unskilled, low-skilled, and limited-experience workers. Further, it is considered perfectly acceptable for these workers (and their supporters like labor unions) to use the coercive power of the government to enact minimum wage legislation to attain above-market wages, ...


June 30, 2015, 5:03 pm, 1499536

Indiana’s 2015 General Assembly session ended just about two months ago. While this year’s tax code reforms were less extensive than past sessions, the legislature made welcome fixes to two policies in particular: the throwback rule and personal property taxes.

The throwback rule is a little-known but ...


June 30, 2015, 5:03 pm, 1499535

In a rare move that caps an intense legislative session, the Maine Legislature has overridden Governor Paul LePage’s budget veto, thereby completing the budget process with mere hours to go before the start of the new fiscal year.

LePage’s introduced budget proposed sweeping tax reform, and the Governor repeatedly expressed ...


June 30, 2015, 5:03 pm, 1499534

Federal Reserve Vice Chairman Stanley Fischer said Tuesday that Fed policy makers are on track to raise interest rates “when we have seen further improvement” in the labor market and inflation.

Mr. Fischer said the U.S. labor market has been slowly improving but still has a way to go before ...


June 30, 2015, 5:03 pm, 1499533
Fannie Mae reported today that the Single-Family Serious Delinquency rate declined in May to 1.70% from 1.73% in April. The serious delinquency rate is down from 2.08% in May 2014, and this is the lowest level since August 2008.

The Fannie Mae serious delinquency rate peaked in ...


June 30, 2015, 4:45 pm, 1499532
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June 30, 2015, 4:45 pm, 1499531
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June 30, 2015, 4:45 pm, 1499530
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June 30, 2015, 4:34 pm, 1499529
Teaser:

So ...


June 30, 2015, 4:34 pm, 1499528
Teaser:

America ...


June 30, 2015, 4:05 pm, 1499520

When Greece’s finance minister, Yanis Varoufakis, in an early round of negotiations in Brussels, complained that Greek pensions could not be cut any further, he was reminded bluntly by his colleague from Lithuania that pensioners there have survived on far less. Lithuania, according to the most recent figures issued by ...


June 30, 2015, 4:04 pm, 1499519
(June 30, 2015 05:48 PM, by David Henderson) While surfing the web this morning, I came across a mention, by Cato Institute economist Dan Ikenson, of a White House conference call on the Export-Import Bank. I thought, what the heck, the call is during my lunch break; I'll... (0 COMMENTS)


June 30, 2015, 4:04 pm, 1499518
Imagine you had to choose, and could choose: you can spend your whole life and raise your family in either of two equally prosperous countries. In one country people work lots of hours to attain that prosperity. In the other country people work far less. You don’t know anything else about these countries. Which ...


June 30, 2015, 4:04 pm, 1499517

There is general support among the public for legislated, government-mandated minimum wages for unskilled, low-skilled, and limited-experience workers. Further, it is considered perfectly acceptable for these workers (and their supporters like labor unions) to use the coercive power of the government to enact minimum wage legislation to attain above-market wages, ...


June 30, 2015, 3:33 pm, 1499510

I'm missing something here (Supreme court blocks Obama's limits on power plants):

The Supreme Court on Monday blocked one of the Obama administration’s most ambitious environmental initiatives, an Environmental Protection Agency regulation meant to limit emissions of mercury and other toxic pollutants from coal-fired power plants.

Industry groups and some 20 ...


June 30, 2015, 3:03 pm, 1499449

The Wall Street Journal’s Daily Report on Global Central Banks for Tuesday, June 30, 2015:

Sign up for the newsletter: http://on.wsj.com/grandcentralsignup


Highlights

Hilsenrath’s Take: China’s Slowdown is of Greater Consequence than Greece’s Debt For Fed to ...


June 30, 2015, 3:03 pm, 1499448

Federal Reserve Vice Chairman Stanley Fischer said Tuesday that Fed policy makers are on track to raise interest rates “when we have seen further improvement” in the labor market and inflation.

Mr. Fischer said the U.S. labor market has been slowly improving but still has a way to go before ...


June 30, 2015, 3:03 pm, 1499447
Here is a minor indicator I follow from the National Restaurant Association: Restaurant Performance Index Remained in Positive Territory in May

Although same-stores sales and customer traffic levels softened somewhat in May, the National Restaurant Association’s Restaurant Performance Index (RPI) remained in positive territory. The RPI – a ...


June 30, 2015, 2:44 pm, 1499446
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June 30, 2015, 2:44 pm, 1499445
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June 30, 2015, 2:44 pm, 1499443
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June 30, 2015, 2:44 pm, 1499442
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June 30, 2015, 2:44 pm, 1499444
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June 30, 2015, 2:44 pm, 1499441

Credit Slips blogger, Anna Gelpern, was on the Diane Rehm Show this morning discussing the financial problems in Puerto Rico and Greece. Gelpern of Georgetown University was joined by Greg Ip of the Wall Street Journal and Matthias Matthjis of Johns Hopkins. A link to the ...


June 30, 2015, 2:35 pm, 1499440

by Edward Stringham

We hear of high profile cases of police killings, but few look at the larger picture of how often American citizens are killed by police. What is the rate at which police kill citizens and how does that compare to other homicide rates? Although


June 30, 2015, 2:35 pm, 1499439

Jerry O’Driscoll

The Association of Private Enterprise Education will hold its annual meeting in Las Vegas, Nevada, April 3rd to 5th, 2016. This year’s conference theme is Capitalism: Free-Market or Crony? Papers are welcome on that topic, as well as other topics relevant to market economies. That list certainly includes Austrian ...


June 30, 2015, 2:05 pm, 1499435

June 30, 2015, 2:04 pm, 1499434
(June 30, 2015 12:22 PM, by Scott Sumner) Like many American economists, I've learned macroeconomics from an American perspective. But America is a very unusual country. For instance, US RGDP growth has averaged about 3% for the past 120 years, if not more. Most business cycles are fairly... (2 COMMENTS)


June 30, 2015, 2:04 pm, 1499433
(Don Boudreaux)

Here’s a letter to the Washington, DC- based WTOP Radio:

In your report this morning ...


June 30, 2015, 2:04 pm, 1499432

Emannuel Saez

Is this good news, bad news, or a bit of both? From the Associated Press and CNBC:

Incomes for the bottom 99 percent of American families rose 3.3 percent last year to $47,213, the biggest annual gain in ...


June 30, 2015, 2:04 pm, 1499431

Editor’s note: The following is Desmond Lachman’s response to the New York Times Room for Debate question: Should Greece abandon the euro?

Albert Einstein famously remarked that a sure sign of insanity was to keep repeating exactly the same experiment and to expect a different result. Yet that is what the ...


June 30, 2015, 1:34 pm, 1499427
Coordinated Meddling

Eurozone leaders are pouring it on thick again today with warning after warning. Yesterday, German chancellor Angela Merkel, French president Francois Hollande, and European Commission president Jean-Claude Juncker were all I in on the Coordinated Meddling hoping to convince Greece citizens to accept the current ...


June 30, 2015, 1:03 pm, 1499365

I have a new column:

The Problem with Completely Free Markets: The Supreme Court’s decision last week saved Obamacare from the Republican’s latest attempt to get government out of health care. But if Republicans can find another way to attack the Affordable Care Act, they surely will.

Healthcare is not, ...


June 30, 2015, 1:03 pm, 1499364
The expected slowdown in year-over-year price increases has occurred. In October 2013, the National index was up 10.9% year-over-year (YoY). In April 2015, the index was up 4.2% YoY. However the YoY change has only declined slightly recently.

Here is the YoY change for the last 12 ...


June 30, 2015, 12:45 pm, 1499363
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June 30, 2015, 12:45 pm, 1499362
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June 30, 2015, 12:45 pm, 1499361
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June 30, 2015, 12:45 pm, 1499359
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June 30, 2015, 12:45 pm, 1499360
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June 30, 2015, 12:35 pm, 1499358
The ISM Manufacturing Index is expected to tick fractionally lower to 52.7 in tomorrow’s update for June vs. the previous month, based on The Capital Spectator’s average point forecast for several econometric estimates. The prediction is still above the neutral 50.0 mark and so the current outlook still calls for ...


June 30, 2015, 12:04 pm, 1499355

Remember how President Obama failed to enforce his “red line” in Syria? Well, it’s happening again — this time in cyberspace.

On April 1, Obama drew a cyber “red line” in the sand when he signed an executive order authorizing sanctions against individuals or entities who carry out cyberattacks or ...


June 30, 2015, 12:04 pm, 1499354

Key Points

Competency-based education (CBE) programs tend to serve students with previous professional or academic experience. This audience affects how the programs are structured and designed.CBE inverts the structure and choice of traditional higher education. The most clearly defined components of traditional higher education programs are much less structured in CBE ...


June 30, 2015, 12:04 pm, 1499353

President Obama welcomes his Brazilian counterpart Dilma Rousseff to Washington in the wake of bad news back home, wrought by statist policies that have smothered the country’s potential: projected inflation of 9% and a forecast economic recession of about -1.5% this year. Rousseff also is facing a political crisis generating ...


June 30, 2015, 12:04 pm, 1499352

Federal budget deficits and the growing national debt are less in the news these days for a couple of reasons. For starters, annual deficits are expected to be lower for the next several years compared with the recent past. The Congressional Budget Office projects that the 2015 federal deficit will ...


June 30, 2015, 12:04 pm, 1499351
Senior fellow John Bolton discusses the Iran nuclear deal on Fox News' 'America's Newsroom'


June 30, 2015, 12:04 pm, 1499349

Although 2015 is only halfway over, it has already been a banner year for private school choice programs across the country. No longer are vouchers or tax credits simply boutique options dotting the periphery of the education system. In states like Indiana, Florida and now Nevada, they are becoming central ...


June 30, 2015, 12:04 pm, 1499350

Senate Foreign Relations Committee Chairman Bob Corker (R-TN) has begun a visit to Venezuela, amidst an economic and political crisis that is compounded by alleged drug trafficking by senior members of the regime of President Nicolás Maduro. Corker’s visit has raised hopes among members of the Venezuelan democratic opposition, ...


June 30, 2015, 11:34 am, 1499347

Steven Horwitz

The Society for the Development of Austrian Economics is pleased to announce the winners of the 2015 Carl Menger Essay Contest for undergraduate students. Professors Michael Thomas, Adam Martin, and Daniel D’Amico were this year’s judges. All entries were anonymous.

The prize comes with $500 plus a travel ...


June 30, 2015, 11:33 am, 1499346
Puerto Rico is bankrupt. The key problem is that while municipalities can declare bankruptcy, states and territories cannot.

President Obama recognizes the problem. He says No Federal Bailout for Puerto Rico. Instead he urges Congress to pass a bill allowing Puerto Rico to declare bankruptcy.


June 30, 2015, 11:03 am, 1499285
S&P/Case-Shiller released the monthly Home Price Indices for April ("April" is a 3 month average of February, March and April prices).

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

Note: Case-Shiller reports Not ...


June 30, 2015, 10:45 am, 1499284
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June 30, 2015, 10:45 am, 1499283
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June 30, 2015, 10:45 am, 1499282
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June 30, 2015, 10:35 am, 1499281
Private nonfarm payrolls in the US are projected to increase by 200,000 (seasonally adjusted) in tomorrow’s June update of the ADP Employment Report, based on The Capital Spectator’s average point forecast for several econometric estimates. The average projection is fractionally below May’s increase. Two estimates based on recent surveys of ...


June 30, 2015, 10:35 am, 1499280

To what extent can the state be used to advance leftist aims? This is one of the questions posed by the Greek crisis. But two things I've seen recently suggest the left in the UK should also be asking this.

First, Fraser Nelson ...


June 30, 2015, 9:34 am, 1499276

Steve Poloz is good at economics, but not always so good at finding the best metaphor.

Greg Quinn says "Bank of Canada Governor Stephen Poloz said his “controversial” decision to cut interest rates in January could be compared to life-saving surgery for the economy and any resulting increase in ...


June 30, 2015, 9:33 am, 1499275

From my sophomore level environmental and resource economics class:

Im an environmental chemistry major so i had to take the class for my major. He's a nice guy, he doesnt seem full of himself like people have said on here. for lectures he just kind of draws graphs with abbreviated notes ...


June 30, 2015, 9:03 am, 1499212

The unorthodox world of central bank policy, in vogue since the global economy plunged into a deep banking and markets crisis almost a decade ago, will remain the norm for some time yet, according to the head of Australia’s central bank.

In a speech to the Official Monetary and Financial Institutions ...


June 30, 2015, 9:03 am, 1499211
William Dudley speaks in Minneapolis on June 5. Bridget Bennett/Bloomberg

NEW YORK—Federal Reserve Bank of New York President William Dudley highlighted Tuesday the importance of consistent international ...


June 30, 2015, 9:03 am, 1499210

The Wall Street Journal’s Daily Report on Global Central Banks for Tuesday, June 30, 2015:

Sign up for the newsletter: http://on.wsj.com/grandcentralsignup


Highlights

Hilsenrath’s Take: China’s Slowdown is of Greater Consequence than Greece’s Debt For Fed to ...


June 30, 2015, 8:45 am, 1499209
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June 30, 2015, 8:44 am, 1499208
The Greek government has rejected the latest austerity and reform proposals from the EU, the ECB, and the IMF. It has declared a national referendum, scheduled for Sunday, and urges a "No" vote. ...


June 30, 2015, 8:35 am, 1499207
The escalating Greek crisis has raised new questions about the timing of the Federal Reserve’s plans for the first US rate hike since 2006. But by some accounts, it’s still mostly noise on this side the Atlantic. “This isn’t a ‘watch Greece’ situation,” says Roberto Perli, a former Fed staffer ...


June 30, 2015, 8:35 am, 1499206

Following up on the disputes with Univision that arose in the wake of Donald Trump’s derogatory comments toward Mexican immigrants, NBC Universal has cut its ties with Donald Trump:

Amid mounting public pressure, NBCUniversal announced Monday that ...


June 30, 2015, 8:05 am, 1499204

Today is Asteroid Day the anniversary of the largest asteroid impact in recent history, the June 30, 1908 Siberian Tunguska asteroid strike. The Tunguska asteroid was only about 40 meters in size but the impact was 1000 times more powerful than the Hiroshima nuclear bomb.

Large asteroid strikes are low-probability, high-death events–so high-death that ...


June 30, 2015, 8:04 am, 1499203
(Don Boudreaux)

… is from page 226 of the 2014 collection, The Market and Other Orders (Bruce Caldwell, ed.), of some of ...


June 30, 2015, 8:04 am, 1499202


June 30, 2015, 7:34 am, 1499197

John Cochrane's very skeptical review of "behaviorial economics".


June 30, 2015, 7:34 am, 1499195

Scientific paper in Cell Metabolism. More evidence in favor of beneficial effects from intermittant fasting.

Link via Instapundit.


June 30, 2015, 7:34 am, 1499196

From the Committee for a Responsible Federal Budget.

Alas, to paraphrase Jimmy Durante, they've got a million of 'em!


June 30, 2015, 7:34 am, 1499194

June 30, 2015, 7:34 am, 1499193

Clyde Wayne Crews, Jr. makes an important point. I hope the Republican nominee reads this and campaigns vigorously on it.

(I wouldn't make a case for any particular amount. But the point is qualitativelycorrect.)

Related: an academic paper by John W. Dawson and John J. Seater, "Federal Regulation ...


June 30, 2015, 7:03 am, 1499130

The fast-developing situation in Greece and the eurozone could spark volatility in financial markets and the global economy. The Federal Reserve, among others, is watching for fallout from overseas that could affect the U.S.

Here is a roundup of recent statements by top U.S. officials, including policy makers at the Fed, ...


June 30, 2015, 7:03 am, 1499131

WASHINGTON–U.S. Treasury Secretary Jacob Lew urged the head of the International Monetary Fund and his German and French counterparts Saturday to continue to seek an emergency financing deal for Greece despite a breakdown in negotiations that is pushing the debt-beleaguered country deeper into crisis.

Just hours after Greek authorities said ...


June 30, 2015, 7:03 am, 1499129
An investor walks by the screen displaying stock prices in a brokerage house in Hangzhou in eastern China’s Zhejiang province last Friday. Associated Press

China’s central bank ...


June 30, 2015, 7:03 am, 1499126

The Wall Street Journal’s Daily Report on Global Central Banks for Monday, June 29, 2015:

Sign up for the newsletter: http://on.wsj.com/grandcentralsignup


Highlights

Blackstone’s Take: A Tale of Two Cities: Basel and Athens Greece Orders Banks Closed, Imposes ...


June 30, 2015, 7:03 am, 1499127

The Federal Reserve should wait until the middle of 2016 to start raising short-term interest rates from near zero to ensure the economy is on a firmer footing and inflation is returning to the central bank’s 2% target after undershooting it for more than three years.

That’s the message from a ...


June 30, 2015, 7:03 am, 1499128
Agence France-Presse/Getty Images

China’s central bank over the weekend pulled a surprise move, cutting the benchmark lending and deposit rates and reducing the amount of funds some banks are required to hold in reserve. The last time ...


June 30, 2015, 7:03 am, 1499125
Reuters

With Greece on the brink of leaving the eurozone and global financial markets panicked by that prospect, eurozone policy makers can’t have expected favorable reviews ...


June 30, 2015, 7:03 am, 1499123

Taking money from the rich and giving it to those less well-off may not generate the stimulative boost to the economy many economists and policy makers currently believe.

New research from the San Francisco Fed, released Monday, takes stock of so-called redistributive economic policies. Simply put, these strategies take money ...


June 30, 2015, 7:03 am, 1499124

LONDON—Raising interest rates too early could risk another recession in the U.K., the Bank of England’s chief economist Andy Haldane plans to say during a speech Tuesday.

According to a prepared text of the speech, Mr. Haldane plans to argue that the central bank should keep the short-term policy rate at ...


June 30, 2015, 7:03 am, 1499121

British consumers are feeling more upbeat than they have in the last decade and a half, so concludes one new survey.

The survey, due to be released Tuesday by market-research firm GfK Group, showed consumers were more optimistic about both their personal financial situation and the general economy in June than ...


June 30, 2015, 7:03 am, 1499120
China’s stock market plunge in recent weeks has rattled nerves, but is hardly surprising given the prior year’s runup, Greg Ip says. ZHENGYI XIE/ZUMA PRESS

Events scattered ...


June 30, 2015, 7:03 am, 1499122
Former Dallas Federal Reserve Bank President and CEO Richard Fisher, who stepped down from his post in March, is joining Barclays as a senior adviser. SLAVEN ...


June 30, 2015, 7:03 am, 1499119
Demonstrators rally in Athens on Monday. Greek voters will decide in a referendum Sunday whether their government should accept an economic reform package put forth by Greece’s creditor.


June 30, 2015, 7:03 am, 1499117
William Dudley speaks in Minneapolis on June 5. Bridget Bennett/Bloomberg

NEW YORK—Federal Reserve Bank of New York President William Dudley highlighted Tuesday the importance of consistent international ...


June 30, 2015, 7:03 am, 1499118

The unorthodox world of central bank policy, in vogue since the global economy plunged into a deep banking and markets crisis almost a decade ago, will remain the norm for some time yet, according to the head of Australia’s central bank.

In a speech to the Official Monetary and Financial Institutions ...


June 30, 2015, 6:44 am, 1499116
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June 30, 2015, 6:44 am, 1499115
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June 30, 2015, 6:35 am, 1499114
● Greece is set to default at the end of today… ● But the Greek crisis isn’t expected to delay the Fed’s first rate hike… ● Meanwhile, US pending home sales rose to a 9-year high in May… ● As Puerto Rico faces bankruptcy… ● Eurozone inflation ticked lower this ...


June 30, 2015, 5:03 am, 1499081

Reuters has sounded some dire news:

Wall St. tumbles as investors flee equities on Greek debt crisis

U.S. stocks fell sharply in heavy trading on Monday and the S&P 500 and ...


June 30, 2015, 5:03 am, 1499080

June 30, 2015, 5:03 am, 1499079

Today, we are fortunate to have a guest contribution written by Laurent Ferrara (Banque de France and University Paris Ouest Nanterre La Dfense) and Pierre Gurin (Bank of Canada). The views expressed here are those of the authors and do not necessarily represent those of the Banque de ...


June 30, 2015, 3:03 am, 1499036
Demonstrators rally in Athens on Monday. Greek voters will decide in a referendum Sunday whether their government should accept an economic reform package put forth by Greece’s creditor.


June 30, 2015, 2:05 am, 1499035

Joseph Stiglitz writes:

It is hard to advise Greeks how to vote on July 5. Neither alternative – approval or rejection of the troika’s terms – will be easy, and both carry huge risks. A yes vote would mean depression almost without end. Perhaps a depleted country ...


June 30, 2015, 2:05 am, 1499034

You’ll find it here (PDF), co-authored with Ranjit Teja and Andrew Wolfe.  Here is a bit of the introductory summary:

Structural reforms

Restoring growth  requires restoring competitiveness.  Key here is local and federal action to lower labor costs gradually and  encourage employment  (minimum wage, labor laws, and welfare reform),  and ...


June 30, 2015, 2:04 am, 1499033
Now that Congress has given the President fast-track Trade Promotion Authority, the first agreement to be considered under these rules (no amendments allowed, up or down vote in 90 days) will be the Trans-Pacific Partnership (TPP). As you know from previous columns, one of the most worrying aspects of the ...


June 30, 2015, 1:33 am, 1499032
This 2 euro coin is issued by Monaco, which is not a member of the Eurozone
Grexit isn't what people take it to be. The standard ...


June 30, 2015, 1:03 am, 1498993
China’s stock market plunge in recent weeks has rattled nerves, but is hardly surprising given the prior year’s runup, Greg Ip says. ZHENGYI XIE/ZUMA PRESS

Events scattered ...


June 30, 2015, 12:44 am, 1498992

Most theories explain the volatility of the stock market with shocks to macroeconomic fundamentals that have important consequences for growth. This column argues that the most important forces behind the longer term gains in the US stock market have not been drivers of economic growth. Instead, they have been an ...


June 30, 2015, 12:44 am, 1498991

Economics in Europe has seen impressive growth in recent years. But European economic research still lags behind the US in terms of productivity. This column discusses a new research project, ‘COEURE’, that will study the state of economic research in Europe and the mechanisms by which it is funded.


June 30, 2015, 12:04 am, 1498989

1. Chart of the Day I (above). The median sales price of an existing home in May at $228,700 was just $1,700 (and 0.74%) below the all-time peak price of $230,400 in July 2006.

2. Chart ...


June 29, 2015, 11:34 pm, 1498988
Anil Kashyap has an excellent summary of the Greek debt crisis.

He sees government printed IOUs as a much better solution to the banking and payments crisis than for Greece to exit the euro and try to reestablish the Drachma. I agree entirely.

His summary goes back ...


June 29, 2015, 11:33 pm, 1498987
Irony of the Day

In a bitter 40 minute lecture, European Commission president, Jean-Claude Juncker, lectures Greece on the "truth".

Other than being a pompous buffoon, Jean-Claude Juncker is most famous for his statement "When it becomes serious, you have to lie".

I believe ...


June 29, 2015, 10:44 pm, 1498964
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June 29, 2015, 10:34 pm, 1498963
Teaser:


June 29, 2015, 9:33 pm, 1498955

1. Chart of the Day I (above). The median sales price of an existing home in May at $228,700 was just $1,700 (and 0.74%) below the all-time peak price of $230,400 in July 2006.

2. Chart ...


June 29, 2015, 9:03 pm, 1498931

British consumers are feeling more upbeat than they have in the last decade and a half, so concludes one new survey.

The survey, due to be released Tuesday by market-research firm GfK Group, showed consumers were more optimistic about both their personal financial situation and the general economy in June than ...


June 29, 2015, 9:03 pm, 1498930

University of Chicago Professor Anil Kashyap has a helpful summary of the Greek financial crisis.


June 29, 2015, 9:03 pm, 1498929
Tuesday:
• At 9:00 AM ET, S&P/Case-Shiller House Price Index for April. Although this is the April report, it is really a 3 month average of February, March and April prices. The consensus is for a 5.4% year-over-year increase in the Comp 20 index for April. The


June 29, 2015, 8:44 pm, 1498928
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June 29, 2015, 8:44 pm, 1498927
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June 29, 2015, 7:33 pm, 1498923

June 29, 2015, 7:33 pm, 1498922
An Opinion Piece in the LA Times argues that the NSF should do a better job prioritizing its strategic investments in basic science. Here are some direct quotes:

"Do the mandarins of the social sciences really believe that a study of depictions of animals in National Geographic ...


June 29, 2015, 7:03 pm, 1498882

Tim Duy:

Events Continue to Conspire Against the Fed, by Tim Duy: Federal Reserve policymakers just can't catch a break lately. Riding on the back of strong data in the second half of last year, they were positioning themselves to declare victory and begin the process of policy normalization, ...


June 29, 2015, 7:03 pm, 1498881
Nothing to add on Greece right now, so here is another forecast for June auto sales.

From WardsAuto: Forecast: SAAR Expected to Remain Above 17 Million in June

A WardsAuto forecast calls for U.S. automakers to deliver 1.48 million light vehicles this month.
...
The report puts the ...


June 29, 2015, 6:04 pm, 1498880
(June 29, 2015 07:33 PM, by David Henderson) In following the Greek economic crisis, I have very little to add that has not been said. But one economist who said it well three and a half years ago is Australian economist and German native Wolfgang Kasper. His Econlib... (0 COMMENTS)


June 29, 2015, 6:04 pm, 1498877

The deadline for a nuclear deal with Iran is fast approaching while rumors swirl of a possible extension. At the same time, Iran has made clear its anti-American agenda and its designs for the Middle East. It has neither stopped its support of terrorist proxies such as Hezbollah, nor has ...


June 29, 2015, 6:04 pm, 1498878

Democrats do better electorally where it’s crowded, Republicans where it’s less so. The greater the population density, the bluer a state, region, or city. And that’s too bad, argue Michael Hendrix and Andrew Evans in National Affairs, because “the result of this electoral reality is that Republicans rarely control the ...


June 29, 2015, 6:04 pm, 1498872

Intergenerational mobility provides a measure of how well children are faring relative to their parents. What are the chances that a child born to parents in the bottom quintile will move to the top of the income distribution? Is the child in a higher income quintile relative to the parents, ...


June 29, 2015, 6:04 pm, 1498876

Congratulations to the gay-rights community for its victory in Obergefell v. Hodges. Anyone familiar with liberty’s history in our country knew that the American people, sooner or later, would reach this point. But with unprecedented speed (President Obama campaigned in 2008 against gay marriage), gays won a sweeping right to ...


June 29, 2015, 6:04 pm, 1498879

Germany – and its chancellor Angela Merkel – deserve credit for the continuation of the EU’s sanctions regime against Russia. But Germany happens also to be home to the energy giant E.ON, which recently signed a (non-binding) memorandum, together with Russia’s Gazprom, Austria’s OMV, and Shell from the UK and ...


June 29, 2015, 6:04 pm, 1498873

Read the PDF

How proud are Americans of their country? As Independence Day approaches, this AEI Public Opinion Study focuses on patriotism in the United States, examining Americans’ self-professed patriotism, how people describe others’ patriotism, and reasons people are proud of the US. This study also looks at how patriotism ...


June 29, 2015, 6:04 pm, 1498874

As we prepare to celebrate Independence Day with songs of national celebration, flags waving in the breeze, parades, and family gatherings, polls reveal Americans’ strong love of country.

For more polls on patriotism, see the AEI Public Opinion Study.

Infographic by Olivier Ballou ...


June 29, 2015, 6:04 pm, 1498875


At AEI’s recent event, “The American dream in crisis,” Robert Putnam, Charles Murray, and William Julius Wilson discussed problems brought to light in Putnam’s new book, “Our Kids: The American Dream in Crisis.” The book expounds upon several alarming trends – the widening ...


June 29, 2015, 6:04 pm, 1498871

Brill explains how federally sanctioned state Medicaid provider taxes operate and affect federal Medicaid spending. He proposes that Congress prohibit these taxes and either put the federal savings back into Medicaid or use them to reduce federal healthcare taxes.

This article will be posted on Monday, July 13. Tax Notes subscribers ...


June 29, 2015, 5:03 pm, 1498822

Last Friday, the Supreme Court issued a ruling in a 5-4 decision of the Obergefell v. Hodges case making same-sex marriage legal in all 50 states and territories of the United States. The ruling has allowed same-sex couples to have the same tax filing options as opposite-sex couples. ...


June 29, 2015, 5:03 pm, 1498821

Taking money from the rich and giving it to those less well-off may not generate the stimulative boost to the economy many economists and policy makers currently believe.

New research from the San Francisco Fed, released Monday, takes stock of so-called redistributive economic policies. Simply put, these strategies take money ...


June 29, 2015, 5:03 pm, 1498820
Former Dallas Federal Reserve Bank President and CEO Richard Fisher, who stepped down from his post in March, is joining Barclays as a senior adviser. SLAVEN ...


June 29, 2015, 4:44 pm, 1498819
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June 29, 2015, 4:04 pm, 1498815
Tomorrow, in addition to the predictable ruling in the EPA/mercury-emissions case, and in addition to a declaration of a constitutional right to same-sex marriage—another 5-4 ruling, in Obergefell v. Hodges—the Court will issue an opinion in Arizona State Legislature v. Arizona Independent Redistricting Commission, a case that could directly implicate continued Republican control ...


June 29, 2015, 3:34 pm, 1498809
Marty Feldstein has a very interesting opinion piece on Project Syndicate. His main point is that micro distortions from social programs (and taxes, labor laws, regulations etc.) are leading many people not to work, and is well stated.

An introductory paragraph poses a puzzle to me, however,


June 29, 2015, 3:33 pm, 1498808

... for the Western Economic Association International 90th Annual Conference (June 28- July 2, 2015); but my co-authors are:

Program Addenda (6/25/15) |Preliminary Program (5/20/15) | Participants Directory (5/20/15)

Session Information & Instructions|Housing Information| General Information
Participating Allied Societies|Exhibitor ...


June 29, 2015, 3:23 pm, 1498807

According to the Atlanta Fed's Wage Growth Tracker, a new series constructed using data from the Current Population Survey, the median increase in wages for individuals working in May 2014 and May 2015 was 3.3 percent (reported as a three-month average).

Wage growth by this measure was essentially ...


June 29, 2015, 3:03 pm, 1498752

The Wall Street Journal’s Daily Report on Global Central Banks for Friday, June 26, 2015:

Sign up for the newsletter: http://on.wsj.com/grandcentralsignup


Highlights

Hilsenrath’s Take: Mixed Inflation Readings Complicate Fed’s Confidence Hurdle Tarullo: Something’s Changed in the Bond ...


June 29, 2015, 3:03 pm, 1498753
A woman holds a plackard reading ‘Yes to Europe–no to austerity, no to drachma’ during a pro-European demonstration in front of the Greek parliament in Athens this week.


June 29, 2015, 3:03 pm, 1498751
A key labor market indicator–the labor-force participation rate–has been on the decline in the U.S., unlike in other countries. A Walmart employee in Miami stocks the shelves.


June 29, 2015, 3:03 pm, 1498748
U.S. Federal Reserve Chairwoman Janet Yellen met with two Senators in April Yin Bogu/Xinhua//Zuma Press

After a flurry of Capitol Hill meetings in March, Federal Reserve ...


June 29, 2015, 3:03 pm, 1498749
An M/I Homes house under construction in a Dallas suburb in June. Kris Hudson/The Wall Street Journal

The national supply of homes for sale is getting squeezed ...


June 29, 2015, 3:03 pm, 1498750
Kansas City Fed President Esther George, shown in April, touted in a speech Thursday what she hoped would be a collaborative process to further modernize the way money is ...


June 29, 2015, 3:03 pm, 1498747
U.S. investors face a short workweek because the financial markets will close Friday to observe the July 4th holiday. But before outdoor grills are fired up and fireworks explode, economy-watchers will get the employment report on Thursday. Those figures, along with new data on wages, home prices, manufacturing and car ...


June 29, 2015, 3:03 pm, 1498744
An investor walks by the screen displaying stock prices in a brokerage house in Hangzhou in eastern China’s Zhejiang province last Friday. Associated Press

China’s central bank ...


June 29, 2015, 3:03 pm, 1498742

The Federal Reserve should wait until the middle of 2016 to start raising short-term interest rates from near zero to ensure the economy is on a firmer footing and inflation is returning to the central bank’s 2% target after undershooting it for more than three years.

That’s the message from a ...


June 29, 2015, 3:03 pm, 1498746

WASHINGTON–U.S. Treasury Secretary Jacob Lew urged the head of the International Monetary Fund and his German and French counterparts Saturday to continue to seek an emergency financing deal for Greece despite a breakdown in negotiations that is pushing the debt-beleaguered country deeper into crisis.

Just hours after Greek authorities said ...


June 29, 2015, 3:03 pm, 1498743
Agence France-Presse/Getty Images

China’s central bank over the weekend pulled a surprise move, cutting the benchmark lending and deposit rates and reducing the amount of funds some banks are required to hold in reserve. The last time ...


June 29, 2015, 3:03 pm, 1498745

The fast-developing situation in Greece and the eurozone could spark volatility in financial markets and the global economy. The Federal Reserve, among others, is watching for fallout from overseas that could affect the U.S.

Here is a roundup of recent statements by top U.S. officials, including policy makers at the Fed, ...


June 29, 2015, 3:03 pm, 1498741

The Wall Street Journal’s Daily Report on Global Central Banks for Monday, June 29, 2015:

Sign up for the newsletter: http://on.wsj.com/grandcentralsignup


Highlights

Blackstone’s Take: A Tale of Two Cities: Basel and Athens Greece Orders Banks Closed, Imposes ...


June 29, 2015, 3:03 pm, 1498740
Reuters

With Greece on the brink of leaving the eurozone and global financial markets panicked by that prospect, eurozone policy makers can’t have expected favorable reviews ...


June 29, 2015, 3:03 pm, 1498738

Taking money from the rich and giving it to those less well-off may not generate the stimulative boost to the economy many economists and policymakers currently believe.

New research from the San Francisco Fed, released Monday, takes stock of so-called redistributive economic policies. Simply put, these strategies take money from ...


June 29, 2015, 3:03 pm, 1498739

LONDON—Raising interest rates too early could risk another recession in the U.K., the Bank of England’s chief economist Andy Haldane plans to say during a speech Tuesday.

According to a prepared text of the speech, Mr. Haldane plans to argue that the central bank should keep the short-term policy rate at ...


June 29, 2015, 3:03 pm, 1498737

Bart Hobijn and Alexander Nussbacher in the SF Fed's Economic Letter:

The Stimulative Effect of Redistribution, by Bart Hobijn and Alexander Nussbacher: The idea of taking from the rich and giving to the poor goes back long before the legend of Robin Hood. This kind of redistribution sounds desirable ...


June 29, 2015, 3:03 pm, 1498736

From Time:

Joseph Stiglitz to Greece’s Creditors: Abandon Austerity Or Face Global Fallout: ... “They have criminal responsibility,” he says of the so-called troika of financial institutions that bailed out the Greek economy in 2010, namely the International Monetary Fund, the European Commission and the European Central Bank. “It’s a ...


June 29, 2015, 3:03 pm, 1498735
Note: I follow several house price indexes (Case-Shiller, CoreLogic, Black Knight, Zillow, FHFA, FNC and more). Note: Black Knight uses the current month closings only (not a three month average like Case-Shiller or a weighted average like CoreLogic), excludes short sales and REOs, and is not seasonally adjusted.

From ...


June 29, 2015, 2:44 pm, 1498734
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June 29, 2015, 2:44 pm, 1498733
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June 29, 2015, 2:44 pm, 1498732
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June 29, 2015, 2:44 pm, 1498731
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June 29, 2015, 2:05 pm, 1498729

June 29, 2015, 2:05 pm, 1498728

Allison Schrager has a new piece on that topic in Playboy, and with a new (old) idea, here is one part:

Harvard economist Lawrence Katz thinks that when the economy shifts, those who lose out experience “retroactive unemployment” in pursuit of jobs that no longer exist; however, he anticipates ...


June 29, 2015, 1:33 pm, 1498724

Tomorrow, June 30, marks the 214th anniversary of the birth of the great French economist Frédéric Bastiat (born June 30, 1801) whom economist Joseph Schumpeter called the “most brilliant economic journalist who ever lived.” Celebrating Bastiat’s birthday has become an annual tradition at ...