Submitted by Businomics Blog
The Housing Bill going through Congress will not solve the nation’s housing problem.  Congress would like to help homeowners who are overextended, as well as prospective home buyers.  By extension, they want to help home-builders and developers and the whole food-chain involved in the residential construction sector.  The housing bill will not […]

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Submitted by CARPE DIEM
From Forbes, America’s 12 cheapest cars (#1 is the Kia Rio, pictured above, base price $10,890). Note that there is only one Big Three vehicles among the 12 cheapest cars, the Chevy Aveo, which is actually built in S. Korea by GM Daewoo.
As consumers switch to cheaper, smaller, more fuel-efficient vehicles, […]

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Submitted by CARPE DIEM
1. One of the nation’s leading retail health clinics, Take Care Health Systems, recently informed the American Academy of Family Physicians that it would not renew its commitment to the Academy’s list of Desired Attributes of Retail Health Clinics. The action fueled AAFP’s already heightened concerns about retail health clinics expanding their […]

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Submitted by Econbrowser
Consider a hypothetical world economy with assets denominated in dollars and euros.

Define the exchange risk premium on dollar denominated assets as:
rp = iUS - i* - E(ds)
where E(.) is the expectations operator, and ds is the change in the log exchange rate in the next period. (Note that this is not the default […]

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Submitted by CARPE DIEM
It’s very hard to guess what the price of oil would be in the absence of speculation, but it’s also impossible to imagine what a world without speculation would look like. I certainly agree that we have no good explanation of these prices. Certainly as an explanation by itself, “speculation” makes little […]

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Submitted by CARPE DIEM
In 1938, when Fannie Mae got started, it was originally a government agency endowed with the authority to buy mortgages, in the hope that this would expand the supply of credit to homeowners. It wasn’t until 1968 that Fannie was privatized. (Freddie Mac was created two years later, and was private from […]

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Submitted by CARPE DIEM
Rising food and energy prices have received a lot of media attention lately, along with concerns about the threat of inflation. The chart above (using BLS data via Economagic) shows a sample of products that have experienced significant deflation in the last ten years (as well as deflation in the last […]

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