Archive for January, 2009

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$646,214 Per Government Job

Submitted by CARPE DIEM
House Democrats propose to spend $550 billion of their two-year, $825 billion “stimulus bill” (the rest of it being tax cuts). Most of the spending is unlikely to be timely or temporary. Strangely, most of it is targeted toward sectors of the economy where unemployment is the lowest.
The December unemployment rate was [...]

Significant Turnover in the Top 400 U.S. Earners

Submitted by CARPE DIEM
The IRS has a new report on the 400 taxpayers reporting the highest adjusted gross incomes (AGI) from 1992 to 2006, summarized in the table above. The 6,000 tax returns (400 highest earners x 15 years) from 1992 to 2006 represented 3,305 unique, individual taxpayers, since some taxpayers made it into the [...]

Stimulus Pork

Submitted by unsettling economics
Senator Max Baucus got $26 billion for private equity companies — the vultures that buy companies, load them up with debt, collect exorbitant fees, and then try to sell them to the unsuspecting public.
Senator Robert Byrd is getting $4.6 billion for clean coal. “Clean, carbon-neutral coal can be a ‘green’ energy,” Byrd [...]

Best Economic Indicator You’ve Never Heard Of

Submitted by CARPE DIEM
Both Dennis Gartman and Larry Kudlow have reported recently on the recovery in the London-based Baltic Dry Index (BDI), “an assessment of the price of moving the major raw materials by sea. Taking in 26 shipping routes measured on a timecharter and voyage basis, the index covers Handymax, Panamax, and Capesize [...]

Real Estate Agents Say Home-price Tide Has Turned

Submitted by CARPE DIEM
CHICAGO TRIBUNE – Chicago-area real estate agents, who have been pleading for months with stubborn sellers to lower their prices, say the tide has finally turned and sellers are capitulating. Price reductions totaling $25,000 or more are becoming commonplace, and homes that have been relisted after several months off the market are [...]

Economics Content Recommendations for Meeting Planners

Submitted by Businomics Blog
You’re planning a meeting. How has the recession changed the information that your meeting attendees need? I answered that question in a webinar for MPI, Meeting Professionals International. Click hear to watch. I gave my usual economic outlook presentation, then added some comments specifically for MPI members. (I customize virtually all of [...]

DREAMING OF BETTER DAYS

Submitted by The Capital Spectator
Looking for a sign of sunnier days when a storm is raging is human nature. Homo economicus is an optimistic creature at heart, although that optimism is now being put to the test.

On first glance at today’s update on new orders for durable goods, there’s reason to hope if only because [...]

New Home Market Getting Closer to Normal

Submitted by Businomics Blog
New home sales were down in December, the headlines say, but that misses the good news: we’re continually whittling away at the inventory of new homes:

That horizontal line shows the long-run average. There’s no reason that a current equilibrium would equal the long run average, especially in an ever-changing economy, but it [...]

Beware of the False Claims About Jobless Claims

Submitted by CARPE DIEM
WASHINGTON, Jan 29 (Reuters) - The number of people remaining on the unemployment benefits roll after drawing an initial week of aid, or continued claims, rose 159,000 to a higher-than-forecast 4.776 million in the week ended Jan 17, the most recent week for which data is available. The Labor Department said this [...]

1982 Jobless Claims = 937,000 Jobless Claims in ‘09

Submitted by CARPE DIEM

The Department of Labor just released its weekly update on jobless claims, reporting that:

For the week ending Jan. 24, the advance figure for seasonally adjusted initial claims was 588,000, an increase of 3,000 from the previous week’s revised figure of 585,000. The 4-week moving average was 542,500, an increase of 24,250 from [...]

Those Merciless, Greedy Consumers Run The Show

Submitted by CARPE DIEM
The consumers are merciless. They never buy in order to benefit a less efficient producer and to protect him against the consequence of his failure to manage better. They want to be served as well as possible. And the working of the capitalist system forces the entrepreneur to obey the orders issued [...]

Capitalism and Markets Fuel Economic Growth

Submitted by CARPE DIEM
The chart above (click to enlarge) shows annual real GDP per capita (in 2004 dollars) from 1800 to 2008 (data from Global Financial Data, paid subscription required). Between 1800 and 1904, real GDP per capita grew in the U.S. at 1.5% per year, a sustained, positive growth rate in real output over [...]

Multipliers, again

Submitted by Econbrowser
From CBO Director Doug Elmendorf’s testimony yesterday, some numbers relevant to the ongoing debate over fiscal policy efficacy [1] [2]:

Table 5: from The State of the Economy and Issues in Developing an Effective Policy Response,” testimony of CBO Director Douglas Elmendorf, January 27, 2009.
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IMF: “World Growth Grinds to Virtual Halt…”

Submitted by Econbrowser
Well, that’s the IMF Survey title, describing the IMF’s World Economic Outlook.

I’ll just reproduce Figure 2, which pretty much sums up the situation.

Figure 2: from IMF WEO update.Table 1.1 in the Update is also instructive, mostly because it shows how rapidly growth prospects have collapsed since the November (not October) WEO forecasts (e.g., [...]

Wingsuit Base Jumping: These Boys Are Crazy

Submitted by CARPE DIEM
wingsuit base jumping from Ali on Vimeo.
Link.
HT: Mark Schrantz
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REINVENTING FOMC COMMENTARY

Submitted by The Capital Spectator
The press release that follows the Fed’s FOMC meeting today may offer clues about how the central bank will proceed now that it’s out of conventional monetary policy ammunition. Then again, maybe not. We’re all trapped in gray zone of trial and error about what to do next and the Federal [...]

Stimulus bill

Submitted by Econbrowser
House Democrats have unveiled their proposal for economic stimulus. Here’s mine.

I’m sympathetic to a proposed requirement that any bill be read in its entirety on the House floor before representatives are asked to vote on it. Were I a member of that legislative body, I would be inclined to vote “no” on any [...]

Stimulated vs. Unstimulated

Submitted by CARPE DIEM
(Click to enlarge.)
Any so-called stimulus program is a ruse. The government can increase its spending only by reducing private spending equivalently. Whether government finances its added spending by increasing taxes, by borrowing, or by inflating the currency, the added spending will be offset by reduced private spending. Furthermore, private spending is generally [...]

Internet Doesn’t Give a Damn About the Recession

Submitted by CARPE DIEM
In 2008 the stock market fell into shambles, the real estate market tumbled, big companies announced big layoffs, venture capital investors became more careful, and the entire world economy went downhill. It’s enough to put a sour face on the most optimistic person.
But now contrast this with what happened to the Internet [...]

Take A Free Finance Course From Robert Shiller

Submitted by CARPE DIEM
Academic Earth provides thousands of free video lectures from the world’s top scholars at Harvard, Yale, MIT, Berkeley, Princeton, Stanford and Yale on a wide variety of subjects(sciences, law, math, philosophy, religion, history, computer science, economics, etc.). From its website:

Academic Earth is an organization founded with the goal of giving everyone on [...]

There’s No Such Thing as “Free” Growth

Submitted by CARPE DIEM
You’ve probably heard of TANSTAAFL? University of Mississippi economics professor William Shughart explains why there’s no so such thing as “free” growth (TNSTAFG):

News that Toyota will delay indefinitely construction of its yet-unfinished North American plant in Blue Springs, Miss., provides further proof, if any is needed, that government should not be [...]

Average State Dec. 2008 Jobless Rate of 6.7% is 3.8% Below Avg. Record High Jobless Rate of 10.5%

Submitted by CARPE DIEM
The BLS keeps track of the historical high unemployment rate in each of the 50 states (and D.C.) and the historical low unemployment rate (back to 1976). As much as we hear about the “Worst Economy Since the Great Depression©,” wouldn’t you think that many states should be setting record high jobless [...]

Economics Will Shift From Recession to Recovery

Submitted by Businomics Blog
Marina Whitman had a great article in Tuesday’s Wall Street Journal basically arguing that all the stimulus we’re doing now is fine, but when the economy starts to expand, policy will have to shift quickly:
But once the world’s economies are growing again, the Fed will have to contain the inflationary pressures it [...]

HR 1 and the Fiscal Impulse over the next 20 months (and an instance of deja vu).

Submitted by Econbrowser
The CBO has posted an actual “cost estimate” on HR 1 (not just a partial examination of Division A, as explained in the Director’s Blog, the locus of great disinformation in previous discussions, as recounted by Dean Baker). Here is a graphical depiction of what CBO believes will be the impact on the [...]

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