Archive for October, 2008
« Previous EntriesGood Reading on the Financial Crisis
Submitted by Businomics Blog
Russ Roberts, econ prof at George Mason, has a good article in today’s Wall Street Journal entitled, “Don’t Just Do Something. Stand There.”
I’m also enjoying the current issue of Forbes Magazine, especially Edmund Phelps’s article.
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Prescription Price War
Submitted by CARPE DIEM
LA Times — One of the nation’s largest drugstore chains ratcheted up a price war Thursday (yesterday), offering deep discounts on generic prescriptions amid national concern about the spiraling cost of healthcare.
Drugstore giant CVS Caremark Corp. announced it would sell 90-day supplies of more than 400 medications for $9.99 and offer discounts [...]
UK Retailer Tesco Now Grammatically Correct
Submitted by CARPE DIEM
The U.K.’s largest retailer Tesco has bowed to pressure from those lobbying for the use of good English and have altered checkout signs reading “ten items or less” in the interests of being grammatically correct. From now on, signs in new stores are to say “up to 10 items” after a long [...]
SAVING: IT’S THE NEW, NEW THING (AGAIN)
Submitted by The Capital Spectator
Today’s update on personal income and spending corroborates yesterday’s GDP report, which told us clearly that the consumer is wary and is cutting back sharply on consumption.
The smoking gun today is that while disposable personal income rose 0.2% in September, personal consumption spending dropped 0.3%. It’s not the first time that [...]
Some Additional Observations on the 2008Q3 Advance GDP Release
Submitted by Econbrowser
If you went no further than noticing that the q/q annualized growth rate of -0.3% was faster than the -0.5 in the Bloomberg consensus, you might have taken this as good news. I’m not going to say it wasn’t good news (relatively speaking), although negative growth makes the case for recession pretty good [...]
$230 BIllion Annual Savings From Falling Gas Prices
Submitted by CARPE DIEM
Update: The $1.62 per gallon fall in gas prices since the $4.12 peak in July to the current $2.50 (see chart above from this link), represents an annual savings for consumers of about $230 billion (compared to a scenario if gas prices stayed about $4). On a previous CD post, I showed [...]
8th, 9th States: KY and SC Gas Prices Below $2
Submitted by CARPE DIEM
Kentucky link.
South Carolina link.
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Real GDP fell slightly in 2008:Q3
Submitted by Econbrowser
The Bureau of Economic Analysis reported today that U.S. real GDP fell at a 0.3% annual rate in the third quarter of 2008. That’s the second quarter of negative real GDP growth out of the last four, and puts the cumulative annual growth since 2007:Q3 at an anemic 0.8%.
As expected, the most [...]
Economic Forecast for 2009, Updated 10/30/2008
Submitted by Businomics Blog
With today’s new GDP figures for Q3, I’ve updated my forecast. Here’s how it looks:
That last blue column, the slightly negative one, is last quarter’s 0.3% decline. I forecast declines in the current quarter as well as the first quarter of next year.
What will get the economy growing again? That’s the most [...]
Don’t Vote; It Makes More Sense to Play Lottery
Submitted by CARPE DIEM
We might be headed for another close election, which means your vote could really matter this time, right? Wrong. Your vote didn’t matter in 2000, it never mattered before 2000, and it’s very unlikely to start mattering now.
~Economist Steven E. Landsburg, in Slate.com, before the 2004 presidential election
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Seventh State: Ohio Gas Prices Fall Below $2
Submitted by CARPE DIEM
Link.
HT: TC
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Exxon Taxes = Federal Tax Revenue from 6 States
Submitted by CARPE DIEM
Third quarter results are out, and it’s “Exxon bashing” season again. It’s now widely reported that Exxon’s $14.8 billion profits in the third quarter set a new record, but what has gone almost completely unreported again is that Exxon paid a new record $11.327 billion in income taxes to various governments in [...]
Pro-Con Smackdown on the Economy
Submitted by CARPE DIEM
Which presidential candidate has the better economic vision for America?
I say McCain, Mark Weisbrot says Obama, distributed nationally through McClatchy-Tribune News Service in the Sacramento Bee, Miami Herald, Duluth MN News-Tribune, Kansas City Star, Raleigh News and Observer, Anchorage Daily News, etc.
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THE DECLINE AND FALL OF CONSUMPTION IN Q3
Submitted by The Capital Spectator
This morning’s news that third-quarter GDP retreated by 0.3% should surprise no one. This slump is arguably one of most anticipated contractions in recent memory. In any case, the recession is here, although officially the label won’t be applied until NBER gets around to reporting what’s already obvious. But barring an [...]
Deflation risk
Submitted by Econbrowser
There are plenty of things to worry about in the current economic situation. But deflation isn’t one of them.
Greg Mankiw had a great article last weekend in which he challenged the view that macroeconomists have learned enough to prevent a repeat of the Great Depression. Greg notes some disturbing similarities between our current [...]
The Economic Crisis and Us Bloggers: a PBS Story
Submitted by Businomics Blog
My web traffic is way up in the past couple of months (partly thanks to the crisis, partly thanks to Google raising my Page Rank up to 6). Simon Owens has an article here on the PBS web site about how economics blogs are covering the story.
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New Federal Reserve Easing–Or Old?
Submitted by Businomics Blog
The Fed announced this morning (Wednesday, Oct 29) that it’s cutting the target Fed Funds rate by one half percent to one percent. But look at the daily actual Fed Funds rate since July:
Fed Funds has already been trading below one percent for quite some time. Also note how volatile the rate [...]
The Fed Cut Rates Below 1% Two Weeks Ago
Submitted by CARPE DIEM
Fed Statement on Interest Rates: The Federal Open Market Committee decided today to lower its target for the federal funds rate 50 basis points to 1%.
MP: The Fed cut the federal funds rate to below 1% more than two weeks ago, see chart above of the actual, effective fed funds rate [...]
Sixth State: Kansas Gas Prices Fall Below $2
Submitted by CARPE DIEM
Now Kansas, following Iowa, Tennessee, Oklahoma, Texas, and Missouri.
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The Culture of Gov’t. Dependence, Entitlement Mentality and Penalization of the Succesful
Submitted by CARPE DIEM
Excerpts from An American Businessman’s Letter to Obama, from Corey Miller, aka “Corey The Well Driller”:
You see, Mr. Obama, I’m the guy you intend to raise taxes on. I’m the guy who has spent 25 years toiling and sweating, fretting and fighting, stressing and risking, to build a business and get ahead. [...]
A BRIEF REPRIEVE
Submitted by The Capital Spectator
A small ray of sunshine on the economic front greets us today in the update for durable goods orders. Alas, it’s not the sign of a turning point. Not even close.
New order for durable goods rose 0.8% last month vs. August, the Census Bureau reports. But September’s bump doesn’t change the [...]
Walter Williams Goes to Bed Greedy, Dreams Greed
Submitted by CARPE DIEM
Speaking of CEOs, there’s the “unconscionable,” “obscene” salaries they receive, in some cases over $10 million a year. Wackonomics has an easy answer for these high salaries: it’s greed.
However, CEOs don’t have the corner on greed. There are other greedy people we don’t scorn but hold in high esteem. According to [...]
It Could Be Worse, A Lot Worse
Submitted by CARPE DIEM
Now here’s a real financial crisis: 231 million percent inflation and 80% unemployment rate in Zimbabwe.
Heading to the grocery store:
The Z$1.243 billion dinner bill:
Paying the bill:
See more pictures of Zimbabwe’s monetary and inflation crisis.
HT: Ben Cunningham
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College Rankings Based on Results
Submitted by Businomics Blog
In the latest issue of the Businomics Audio Magazine I interview economist Rich Vedder, who has just completed a new set of college rankings based on performance, rather than inputs into the educational system. The rankings were published in Forbes Magazine (and incidentally show my alma mater scoring very high.)
Go to the [...]
WHAT, IF ANYTHING, CAN DIVIDEND YIELD TELL US?
Submitted by The Capital Spectator
It’s been known for some time–decades, really–that relatively high dividend yields tend to precede relatively high returns in subsequent years. Graham and Dodd’s Security Analysis suggested as much about the relationship between valuation and return. More rigorous studies of the valuation phenomenon (of which dividends are only one measure) arrived in [...]
