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 24, 2014, 1:33 pm, 1357268
There's some interesting discussion points in the UK-based Absolute Return Partners October 2014 Letter, by Niels C. Jensen, most of which I agree with, others not.

Japan-Style Deflation in Our Backyard?

It is no secret that we have been long-standing believers in deflation being a more ...


October 24, 2014, 1:33 pm, 1357267

Matt Ridley has a great column on why cheap oil is unambiguously good news – it makes the world richer and fairer, and in the process allows us to abolish much more poverty, disease and misery. Here’s an excerpt:


October 24, 2014, 1:23 pm, 1357266
Happiness is around six times more sensitive to economic growth when that ‘growth’ is negative


October 24, 2014, 1:03 pm, 1357204

Home sales rose to their highest annual pace in September in six years, but the new-home market is still depressed by historical standards.

To get a sense of just ...


October 24, 2014, 1:03 pm, 1357203

If you saw a public-opinion poll that had a 15.7% margin of error, you probably wouldn’t take it too seriously. The latest Wall Street Journal/NBC News poll, for example, had a respectable 3.1% margin of error for registered voters.


October 24, 2014, 1:03 pm, 1357202

Simon Wren-Lewis:

Redistribution between generations: I ought to start a series on common macroeconomic misunderstandings. (I do not watch zombie films.) ... Here is one that crops up fairly regularly - that government debt does not involve redistribution between generations. The misunderstanding here is obvious once you see that ...


October 24, 2014, 1:03 pm, 1357201
The new home sales report for September was slightly above expectations at 467 thousand on a seasonally adjusted annual rate basis (SAAR). With the downward revision to August sales, sales for September were at the the highest sales rate since July 2008.

Sales for the previous three months (June, ...


October 24, 2014, 12:44 pm, 1357200
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October 24, 2014, 12:44 pm, 1357199
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October 24, 2014, 12:44 pm, 1357198

There are three major new regulations shaping the housing finance market:  QM (qualified mortgage), QRM (qualified residential mortgage) and Reg X.  QM is a safe harbor from the statutory ability-to-repay requirement that applies to all mortgages.  QRM is a safe harbor from the statutory risk retention requirement that ...


October 24, 2014, 12:05 pm, 1357197

October 24, 2014, 12:04 pm, 1357196
(October 24, 2014 11:54 AM, by David Henderson) You can take the boy out of Canada, but you can't (completely) take Canada out of the boy As a U.S. federal employee, I'm going through a security clearance for the first time in years. The guy who came to... (2 COMMENTS)


October 24, 2014, 11:33 am, 1357193

Andy Borowitz, not trying to satirize conservatives for once:

An organization of University of North Carolina athletic boosters expressed shock and outrage today over a report that a few members of U.N.C. sports teams may have taken real classes, despite the widespread availability of fake ones.


October 24, 2014, 11:33 am, 1357192

From the WSJ Micro Review:

Natural-Gas Prices Fall Even With Chill Nearing
by: Timothy Puko
Oct 20, 2014

TOPICS:Supply and Demand

SUMMARY:When cold weather looms across the U.S., natural-gas prices usually rise. This year they are falling, after a ...


October 24, 2014, 11:33 am, 1357191

Some time series data:

U.S. energy-related carbon dioxide (CO2) emissions increased in 2013 by 129 million metric tons (2.5%), the largest increase since 2010 and the fourth-largest increase since 1990. Emissions trends reflect a combination of economic factors (population multiplied by per capita output [GDP/population]), energy intensity (energy use per dollar ...


October 24, 2014, 11:33 am, 1357190

The Theory, as taught to generations of economics students:

“Economists say there is a zero bound on the nominal interest rate: it cannot go below zero.” “Nobody would lend money at a negative nominal rate of interest because they could do better by simply holding cash.”

–Paul Krugman et al., “Economics: European Edition”

The ...


October 24, 2014, 11:33 am, 1357189

Well, this is curious. Part of the Republican brand, I thought, was that the GOP was the party of debt reduction and the need to reform entitlements. Paul Ryan made his name as a policy wonk because of his support for Medicare reform. And recall that President Bush unsuccessfully pushed ...


October 24, 2014, 11:03 am, 1357127
Congress and the president put off the hard choices of what spending to cut and what to increase. “We seem to be drifting into the changes,” CBO Director Douglas ...


October 24, 2014, 11:03 am, 1357126

Today we are fortunate to have a guest contribution written by Jeffrey Frankel, Harpel Professor of Capital Formation and Growth at Harvard University, and former Member of the Council of Economic Advisers, 1997-99.

The latest World Economic Outlook, released this month by the International Monetary Fund, warns ...


October 24, 2014, 11:03 am, 1357125
The Census Bureau reports New Home Sales in September were at a seasonally adjusted annual rate (SAAR) of 467 thousand.

August sales were revised down from 504 thousand to466 thousand, and July sales were revised down from 427 thousand to404 thousand.

"Sales of new single-family houses in ...


October 24, 2014, 10:34 am, 1357124
Teaser:

Every ...


October 24, 2014, 10:34 am, 1357123
Teaser:

Everyone ...


October 24, 2014, 10:05 am, 1357118

If you use the word “contagion” these days, people are likely to think you’re talking about ebola. Backup five years ago, and contagion was the buzzword to describe the financial crisis.

The European government bond market was falling apart, and allegedly it had nothing to do with the precarious public ...


October 24, 2014, 10:05 am, 1357117

With the IRS scandals of early 2014 all but a distant memory, some closure is coming to the groups that the long arm of the tax law harassed. Unfortunately the verdicts aren´t going the way the affected would like.

The IRS may have inadvertently figured out how to win its ...


October 24, 2014, 10:04 am, 1357116
(October 24, 2014 09:28 AM, by Art Carden) WARNING: CONTAINS FROZEN SPOILERS. My daughter is four years old, which means we consume a lot of Disney Princess merchandise: movies, toys, etc. As one might expect, everyone in our house basically knows every word to every song from Frozen.... (0 COMMENTS)


October 24, 2014, 9:03 am, 1357053
Agence France-Presse/Getty Images

Figures released on Friday showed U.K. economic growth slowed in the third quarter. Here are five things of note.

#1: A Respectable Performance

The U.K. economy was 0.7% larger in the third quarter than in the ...


October 24, 2014, 9:03 am, 1357051
Federal Reserve Chair Janet Yellen, center, took more than two weeks off before the Jackson Hole Economic Policy Symposium on Aug. 23. Associated Press

How does ...


October 24, 2014, 9:03 am, 1357052

The Wall Street Journal’s Daily Report on Global Central Banks for Friday, October 24, 2014:

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Highlights

Blackstone’s Take: ECB Hopes Its Credibility Can End Europe’s Banking Stress Fed’s 2015 Stress Test ...


October 24, 2014, 9:03 am, 1357050
According to Black Knight's First Look report for September, the percent of loans delinquent decreased in September compared to August, and declined by 12% year-over-year.

Also the percent of loans in the foreclosure process declined further in September and were down 33% over the last year. Foreclosure inventory ...


October 24, 2014, 8:44 am, 1357049
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October 24, 2014, 8:34 am, 1357048
Healthcare is hot, energy is not. That’s the message in the trailing one-year total return data for ETFs that track the major sectors for the US equity market (see list below for tickers and links). Measured by one-total performance, the Health Care Select Sector SPDR (XLV) is up nearly 24% ...


October 24, 2014, 8:34 am, 1357047

Matthew Yglesias argues that “Amazon is doing the world a favor by crushing book publishers.” His essay is a response to the “


October 24, 2014, 8:05 am, 1357045

In the United States we are using advanced technology like fingerprint scans to pay for goods. In Venezuela they are using advanced technology like fingerprint scans to ration goods. Here is the WSJ:

Amid worsening shortages, Venezuela recently reached a milestone of dubious distinction: It has joined the ranks of ...


October 24, 2014, 8:04 am, 1357044
(Don Boudreaux)

… is from the final paragraph of F.A. Hayek’s brilliant and profoundly important December 11, 1974 Nobel Prize lecture, “The Pretense of Knowledge“:

There is danger in the exuberant feeling of ever growing power which the advance of the physical sciences has engendered and which tempts man to ...


October 24, 2014, 7:33 am, 1357037

The New York Times argues that 80 can be the new 50.

Long may it wave.


October 24, 2014, 7:33 am, 1357038

"I'm gonna add some bottom so that the dancers just won't hide."

Too much Red Hot Chili Pepper and Jamiroquai but otherwise, reasonable selections.


October 24, 2014, 7:33 am, 1357036

"You’ll never be able to unsee these."


October 24, 2014, 7:33 am, 1357035
Moreno Bertoldi, Philip R. Lane, Paolo Pesenti, and ValérieRouxel-Laxton

The reason why the macroeconomic policy mix has been different ...


October 24, 2014, 7:33 am, 1357034

At the risk of biting a hand that fed me a tiny morsel, here's an interesting take on the Amazon/Hachette book fight. To me, the interesting piece here is the question of value-added. What value does the publisher add to the publishing process?

In the traditional book purchasing paradigm, ...


October 24, 2014, 7:23 am, 1357033

Readers Question: You have partially explained the answer to my question in your reply to my other question, “What will we do when we can’t pay back the money owing to ...


October 24, 2014, 7:03 am, 1356972

LONDON—A senior Bank of England official Thursday pushed back against critics who claim central bank policies only benefit the wealthy.

Those critics say ultralow interest rates and central-bank asset purchases have fueled a surge in asset prices without spurring durable economic growth, benefiting the rich yet doing little for the wider ...


October 24, 2014, 7:03 am, 1356968

A majority of risk managers at North American financial institutions are worried that the growing wealth gap poses a risk to the financial system.

The Professional Risk Managers’ International Association and FICO, the credit analytics firm, polled bank risk managers on the consequences of inequality during their quarterly survey. ...


October 24, 2014, 7:03 am, 1356969

The Wall Street Journal’s Daily Report on Global Central Banks for Thursday, October 23, 2014:

Sign up for the newsletter

Highlights

Douglas’ Take: Global Growth Worries Echo Across the Pond U.S. Agencies Approve Relaxed Mortgage Rules


October 24, 2014, 7:03 am, 1356971

ISTANBUL—Turkey’s central bank on Thursday held interest rates steady for a second consecutive month, signaling policymakers will stick with a tight stance as an emerging-market selloff weakens the lira and inflation remains stubbornly high.


October 24, 2014, 7:03 am, 1356967

The European Central Bank’s increasingly desperate battle to prevent the eurozone from sliding into deflation suffered a fresh setback in October, as businesses cut their prices at the fastest rate since early 2010.

Some of Europe’s biggest companies have been roiled by weak pricing power, noting that as one factor ...


October 24, 2014, 7:03 am, 1356970

The Bank of Japan now sees a much bigger possibility of inflation slipping below 1%, pushed down by falling crude oil prices, according to people familiar with the central bank’s thinking, a development that could rekindle market speculation for additional easing.

While the BOJ recognizes that lower oil prices are ultimately ...


October 24, 2014, 7:03 am, 1356966
Agence France-Presse/Getty Images

If you’re good with a scalpel and willing to move, Kansas could be the place for you.

Surgeons in the Sunflower State make more—when adjusting for cost ...


October 24, 2014, 7:03 am, 1356962
Agence France-Presse/Getty Images

Figures released on Friday showed U.K. economic growth slowed in the third quarter. Here are five things of note.

#1: A Respectable Performance

The U.K. economy was 0.7% larger in the third quarter than in the ...


October 24, 2014, 7:03 am, 1356963
The German economy’s strong focus on the car industry is also a risk, says Clemens Fuest, director of the Centre for European Economic Research. “If this market stops growing ...


October 24, 2014, 7:03 am, 1356964
The time frame around Bank of Japan Gov. Haruhiko Kuroda’s inflation goal is looking increasingly fuzzy. Bloomberg News

The magic number was “two” when the Bank of ...


October 24, 2014, 7:03 am, 1356965
A Chinese worker gathers up sheep’s wool after it was processed and bleached at a factory near Zhangzhou, China. Getty Images

A 10% increase in China’s minimum ...


October 24, 2014, 6:44 am, 1356961
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October 24, 2014, 6:44 am, 1356960
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October 24, 2014, 6:35 am, 1356959
● Treasuries Advance as NY Ebola Case Boosts Safest Assets | Bloomberg Treasuries rose the most in a week after a doctor in New York City tested positive for Ebola, spurring demand for the haven assets amid concern any outbreak of the virus can weigh on the global economy. ● ...


October 24, 2014, 6:04 am, 1356957


October 24, 2014, 6:04 am, 1356956
by Linda Beale Both the rich and ordinary Americans misunderstand their economic interests There is class warfare going on, right now, all across this country.  It’s highlighted by the election gimmicks and gambits of those on the right who claim to be supporting ordinary Americans but whose real intentions show ...


October 24, 2014, 6:04 am, 1356955
by Joseph Joyce Martin Wolf’s Warning It is time for the 2014 Globie—a (somewhat fictitious) prize I award once a year to a book that deserves recognition for its treatment of the consequences of globalization. (Previous winners can be found here.) The financial turmoil of the last week makes this ...


October 24, 2014, 5:23 am, 1356953
The Local Government Association (which represents local councils in the UK) have joined the debate about term time holidays for pupils this week. They argue that current rules banning term time holidays or imposing fines on those families who take such breaks do not recognise the complexities of modern families ...


October 24, 2014, 5:03 am, 1356900
The time frame around Bank of Japan Gov. Haruhiko Kuroda’s inflation goal is looking increasingly fuzzy. Bloomberg News

The magic number was “two” when the Bank of ...


October 24, 2014, 5:03 am, 1356899
The German economy’s strong focus on the car industry is also a risk, says Clemens Fuest, director of the Centre for European Economic Research. “If this market stops growing ...


October 24, 2014, 5:03 am, 1356898

We need you to watch the following video, in which Dave Hax describes how to freehand draw a perfect circle. Once you've seen how, we need you to duplicate his "target" pattern of the three concentric circles on a sheet of paper, making the innermost ...


October 24, 2014, 5:03 am, 1356897

October 24, 2014, 5:03 am, 1356896

"What's a plutocrat to do?":

Plutocrats Against Democracy, by Paul Krugman, Commentary, NY Times: ...The ... political right has always been uncomfortable with democracy..., there is always an undercurrent of fear that the great unwashed will vote in left-wingers who will tax the rich, hand out largess to the ...


October 24, 2014, 2:05 am, 1356849

It is undeniably true that Amazon has a very large share of the market for e-books. What is not true is that Amazon faces a lack of competition in the digital book market. Barnes & Noble — a company that knows something about books — sells e-books, and does so ...


October 24, 2014, 2:05 am, 1356848

A party can deviate only so far from its core voters:

Cutting federal health and retirement spending has long been at the top of the GOP agenda. But with Republicans in striking distance of winning the Senate, they are suddenly blasting the idea of trimming Social Security benefits.

The latest attack came ...


October 24, 2014, 1:33 am, 1356846

October 24, 2014, 12:34 am, 1356797

Public accommodation laws that prohibit discrimination render property rights moot and create a legal system designed to force agreement with the state's official moral code.


October 23, 2014, 11:33 pm, 1356795

1. Bringing House Calls Back with UberHEALTH — Now there’s an Uber for flu shots. Today the ride-sharing service announced a one-day UberHEALTH pilot program in partnership with Harvard Medical School to deliver free flu shots on-demand. From 10 a.m.- 3 p.m. today Uber drivers delivered a registered ...


October 23, 2014, 11:03 pm, 1356732
The Inland Empire comes full circle ... from the Chris Kirkham at the LA Times: Strong growth is forecast for Inland Empire

[T]he Inland Empire is now the fastest-growing region in Southern California — a trend predicted to continue over the next five years, according to an economic ...


October 23, 2014, 10:04 pm, 1356730
(October 24, 2014 12:02 AM, by Bryan Caplan) Using compulsory attendance laws to estimate the causal effect of education on outcomes has been hot in economics for over a decade. But I was always a skeptic. The idea that minimum schooling leaving laws are exogenous is bizarre, yet... (0 COMMENTS)


October 23, 2014, 9:33 pm, 1356729
The Markit Flash Eurozone PMI shows the steepest fall in output prices since global crisis and renewed job losses, in spite of an otherwise stable PMI.

The Eurozone saw a marginal upturn in growth of business activity in October, according to the flash PMI results. The headline ...


October 23, 2014, 8:44 pm, 1356667

The reason for the divergent macroeconomic policies on the two sides of the Atlantic after the Crisis remains a hotly debated subject. The topic was also discussed at the recent Macroeconomic Policy Mix in the Transatlantic Economy workshop. This column summarises the main discussions at the workshop. Other covered topics ...


October 23, 2014, 8:44 pm, 1356666

The reason for the divergent macroeconomic policies on the two sides of the Atlantic after the Crisis remains a hotly debated subject. The topic was also discussed at the recent “Macroeconomic Policy Mix in the Transatlantic Economy” workshop. This column summarises the main discussions at the workshop. Other covered topics ...


October 23, 2014, 8:44 pm, 1356665
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October 23, 2014, 8:44 pm, 1356664
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October 23, 2014, 8:05 pm, 1356663

Back when I was an economist for a housing agency, I heard about a lot of pricey marketing gimmicks. This is a new one:

Writes Robert Wenzel:

Paging Mark Thornton: The Ultimate Sign of a Chinese Real Estate Bubble?

As part of a marketing campaign by a property developer in ...


October 23, 2014, 7:33 pm, 1356662

There’s been a lot of good economic news recently, here’s a sample below of pretty positive economic reports that were (mostly) released this week.

1. Business Lending. The total volume of commercial and industrial loans at all US commercial banks reached an ...


October 23, 2014, 7:03 pm, 1356601
From the FDIC: FDIC Releases Economic Scenarios for 2015 Stress Testing

The Federal Deposit Insurance Corporation (FDIC) today released the economic scenarios that will be used by certain financial institutions with total consolidated assets of more than $10 billion for stress tests required under the Dodd-Frank Wall ...


October 23, 2014, 6:44 pm, 1356598
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October 23, 2014, 6:44 pm, 1356600
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October 23, 2014, 6:44 pm, 1356599
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October 23, 2014, 6:05 pm, 1356596

In his recent three-part interview (here, here and here) on the gold standard, Larry White perplexes almost as much as he enlightens.  Let’s critically review  his responses to a few of the interviewer’s questions.

First, when queried about evolution of the discussion of the gold standard among classical ...


October 23, 2014, 5:33 pm, 1356591

It’s becoming something close to consensus on the left that very high tax rates won’t hurt economic growth. After all, the US did just fine in the 1950s with a 91% top rate, right? Here is a bit of my thinking on that, from a post


October 23, 2014, 5:33 pm, 1356593

There’s an overdue debate going on over the extent of China’s economic troubles. There are many angles but two indicators don’t get enough attention because they’re down in the weeds. Chinese monetary aggregates say the country is in serious trouble.

M1 is called narrow money, in China defined as ...


October 23, 2014, 5:33 pm, 1356592

I wrote yesterday about the possibility of McDonald’s possible automating away its cashiers. Now Mickey Ds denies that’s the intention of their plan to, as the Wall Street Journal puts it, “roll out new technology in some markets to make it easier for customers to order and pay digitally ...


October 23, 2014, 5:03 pm, 1356530

According to 2011 Census data, there are approximately 27 million businesses in the United States. Of these 27 million businesses, 90 percent of them are what are called “pass-through” businesses.

In regard to taxes, the most distinct feature of a pass-through business is that its income is taxed once on ...


October 23, 2014, 5:03 pm, 1356529
Agence France-Presse/Getty Images

If you’re good with a scalpel and willing to move, Kansas could be the place for you.

Surgeons in the Sunflower State make more—when adjusting for cost ...


October 23, 2014, 5:03 pm, 1356528
A Chinese worker gathers up sheep’s wool after it was processed and bleached at a factory near Zhangzhou, China. Getty Images

A 10% increase in China’s minimum ...


October 23, 2014, 5:03 pm, 1356527


October 23, 2014, 4:44 pm, 1356526
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October 23, 2014, 4:04 pm, 1356523
(October 23, 2014 02:49 PM, by Scott Sumner) The title is my pathetic attempt to imitate Miles Kimball and Noah Smith, who sometimes post on religion. This won't be about religion; it's about monetary policy. Oh wait . . . In the 1970s, US policymakers knew that inflation... (0 COMMENTS)


October 23, 2014, 4:04 pm, 1356522
(October 23, 2014 04:45 PM, by David Henderson) I was on the road from Sunday a.m. to late last night and thus my sparser than usual blogging. I taught classes in Patuxent River, MD on Monday, Norfolk, VA on Tuesday, and Arlington, VA on Wednesday, with lots of... (3 COMMENTS)


October 23, 2014, 4:04 pm, 1356521
This is the average inflation rate expected over the next 5 years… Last data point is for October 21, 2014.


October 23, 2014, 3:33 pm, 1356515
France

Looking for growth in Europe? You won't find it in France, but for now you can still find it in Germany (for now).

The Markit Flash France PMI shows French private sector output falls at sharpest rate in eight months.

Key Points


October 23, 2014, 3:33 pm, 1356514

Dan Rothschild wrote in April (“How Uber and Airbnb Resurrect ‘Dead Capital’“) that the two biggest economic stories of the last decade are: a) the Great Recession and b) the rise of the entrepreneurial sharing economy, or as he describes it, “a category of new businesses that turn ...


October 23, 2014, 3:03 pm, 1356452

After A Few Comments on QE, Bill McBride ends with:

...My view is QE was not a panacea, but overall QE was a success. I was a frequent critic of the Fed prior to the financial crisis - I think the Fed was almost anti-regulation during the housing bubble, and ...


October 23, 2014, 3:03 pm, 1356451
A few comments on QE:

• The FOMC is expected to announce the end of QE3 on Wednesday October 29th, following the FOMC meeting next week.

Most research shows that the primary impact of QE on interest rates is from the size of the Fed ...


October 23, 2014, 2:44 pm, 1356450
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October 23, 2014, 2:34 pm, 1356449

Any close observer of the making of tax policy can see it: Lawyers and economists looking at the same issue through entirely different prisms. I’ve been fascinated by how their respective brains work, and why they have so much trouble communicating with one another. It turns out I am not ...


October 23, 2014, 2:34 pm, 1356448

For several years now, the State of New Jersey has been trying to legalize sports betting as part of an effort to revitalize the casino business in Atlantic City, which has suffered in recent years from the ...


October 23, 2014, 2:05 pm, 1356446

October 23, 2014, 2:05 pm, 1356445

Heilman, the expert in Hasidic succession, told me that one reason so many dynastic fights emerged in the past decade is that the grand rabbis are living longer, sometimes too long to have the vigor to conclusively determine whom their successors will be or so long that their increasingly entrenched ...


October 23, 2014, 2:04 pm, 1356444
(October 23, 2014 12:18 PM, by Art Carden) Minecraft has spawned a lot of imitators. One is Survival Craft, which we heard about a few days ago and downloaded. Our oldest has been playing it virtually non-stop for a couple of days, and he prefers it to Minecraft... (1 COMMENTS)


October 23, 2014, 2:04 pm, 1356443
(Don Boudreaux)

Here’s a letter to a student in New Jersey:

Dear Mr. Sloan:

Thanks for your latest note.  You remember correctly that I agree that Pres. Obama’s “You didn’t build that!” quip referred to infrastructure and other inputs – admittedly produced by others – that each entrepreneur relies on.  You’re mistaken, however, ...


October 23, 2014, 2:04 pm, 1356442
Via Digby comes a couple short films talking about what is money.   They are part of an effort by a group/site called We The Economy that has 20 short films aimed:  to drive awareness and establish a better understanding of the U.S. economy. Told through animation, comedy, musical, non-fiction, and ...


October 23, 2014, 1:33 pm, 1356439

In its search for new revenues, Ontario commissioned a government panel to examine how to wring more money out of government assets. In recent days, the panel led by TD Bank CEO Ed Clark has revealed several ideas including selling off Hydro One’s distribution business, restructuring Ontario Power Generation so ...


October 23, 2014, 1:33 pm, 1356438
Lack of significant improvement in payments by IBEX companies to suppliers is yet another another sign there isn't much of a recovery in Spain.

La Vanguardia reports Late Payments by Ibex Companies Hits €47 Billion, 169 days (nearly 3 times the legal time limit). Ibex is the ...


October 23, 2014, 1:33 pm, 1356437

While Washington keeps talking about income stagnation for the 99%, seem incomes have stopped stagnating — at least for the 80%. From a new Goldman Sachs note:

Perhaps more importantly from the perspective of overall consumption growth, lower- and middle-income wage earners … are sharing fully in the recovery. This is ...


October 23, 2014, 1:03 pm, 1356376

October 23, 2014, 1:03 pm, 1356375

This was in today's links (which were posted later than usual):

Does Raising the Minimum Wage Hurt Employment? Evidence fromChina, by Prakash Loungani, iMFDirect: ...China accounts for nearly 25 percent of the global labor force...

Our study is the first to use data on minimum wage changes for over 2400 ...


October 23, 2014, 1:03 pm, 1356374

Jordi Galí:

The Effects of a Money-Financed Fiscal Stimulus, by Jordi Galí, September 2014: Abstract I analyze the effects of an increase in government purchases financed entirely through seignorage, in both a classical and a New Keynesian framework, and compare them with those resulting from a more conventional debt-financed stimulus. ...


October 23, 2014, 1:03 pm, 1356373
From the Philly Fed:

The Federal Reserve Bank of Philadelphia has released the coincident indexes for the 50 states for September 2014. In the past month, the indexes increased in 43 states, decreased in four, and remained stable in three, for a one-month diffusion index of 78. Over ...


October 23, 2014, 12:44 pm, 1356372
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October 23, 2014, 12:44 pm, 1356371
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October 23, 2014, 12:34 pm, 1356370
Three economic updates today provide more evidence that moderate growth endures for the US. The numbers du jour—weekly jobless claims, the Chicago Fed National Activity Index, and Markit’s US purchasing managers index (PMI) for manufacturing—paint an upbeat profile of the macro trend. The main takeaway: the deflationary threat festering in ...


October 23, 2014, 12:05 pm, 1356366

Today is the 78th birthday of Ralph Raico, the foremost historian of classical liberalism.  Among many other works, Ralph is the author of two outstanding collections of essays, Classical Liberalism and the Austrian School and Great Wars and Great Leaders.  As the latter title suggests, he is a ...


October 23, 2014, 12:05 pm, 1356365

LearnLiberty.org is offering a new course developed by George Crowley of Troy University titled “Subliminal Lessons from South Park: A Super Primer on Economics and Politics.” The course blurb:

Hooowdy Ho Everbody! We are excited to bring you our newest ...


October 23, 2014, 12:04 pm, 1356364
The Fed is an accomplice to the increase in inequality. An accomplice is an entity that helps another entity commit a crime. The real change that led to increased inequality is the conspicuous drop in labor share after the crisis. Record profits by firms were not being transmitted to labor. ...


October 23, 2014, 11:33 am, 1356356

That’s the question raised in a new Washington Post column by AEI economist Mike Strain. Or as the click-friendly headline puts it: “Janet Yellen is in danger of becoming a partisan hack: The Federal Reserve chair shouldn’t be picking a side in political debates.”

Keep in mind Strain is no reflexive Yellen ...


October 23, 2014, 11:03 am, 1356293

Low ranked by ALEC-Laffer, California and Minnesota continue to power along, as shown in data released today by the Philadelphia Fed.

Figure 1: Log coincident indices for Minnesota (blue), Wisconsin (bold red), Kansas (green), California (teal), United States (black), all ...


October 23, 2014, 11:03 am, 1356292
This house price index is only for houses with Fannie or Freddie mortgages.

From the FHFA: FHFA House Price Index Up 0.5 Percent in August

U.S. house prices rose in August, up 0.5 percent on a seasonally adjusted basis from the previous month, according to the Federal Housing ...


October 23, 2014, 10:44 am, 1356291
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October 23, 2014, 10:34 am, 1356290

John Harris writes:

Perhaps those who reduce people’s worries and fears [about immigration] to mere bigotry should go back to first principles, and consider whether, in such laissez-faire conditions, free movement has been of most benefit to capital or labour.

Let's do this. ...


October 23, 2014, 10:34 am, 1356289

John Harris writes:

Perhaps those who reduce people’s worries and fears [about immigration] to mere bigotry should go back to first principles, and consider whether, in such laissez-faire conditions, free movement has been of most benefit to capital or labour.

Let's do this. ...


October 23, 2014, 10:34 am, 1356288
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October 23, 2014, 9:33 am, 1356283

There are two different monetary policies. The green monetary policy gives you the green AD curve, and the red monetary policy gives you the red AD curve. Both monetary policies give you exactly the same equilibrium P* and Y*. (You can interpret P* as the price level, or as the ...


October 23, 2014, 9:23 am, 1356282

Photo Credit: whologwhy || Danger: Butterfly at work!

There’s a phenomenon called the Butterfly Effect.  One common quotation is “It has been said that something as small as the flutter of a butterfly’s ...