Category: economics

Groundhog Day Jobs Number Report

Groundhog Day Jobs Number Report

I feel like I’m in the movie Groundhog Day when it comes to the job numbers. I wake up on the first Friday each month to the same story — subpar job growth, no budging in key indicators, the insanity of the “anti-stimulus” of bleeding government jobs – and then wake up to it again next month. This month looks like the past dozen: 80,000 jobs wsere created, while the government sector shed 24,000 jobs.

If the elimination of public sector jobs causes growth in the private sector, then why isn’t that happening?

The Recovery The Fed Wants

The Recovery The Fed Wants

the FOMC meekly “anticipates that the unemployment rate will decline only gradually toward levels that the Committee judges to be consistent with its dual mandate.” If the unemployment rate is not currently at a level consistent with the mandate and is also not converging rapidly toward a level consistent with the mandate, then in my view the FOMC ought to do something new and dramatic in order to fulfill its mandate. Instead, the FOMC is standing pat. They think 9.1 percent unemployment and moderate growth is fine and they don’t intend to do anything about it.

Bloomberg’s Awful Comment; What Can We Say For Certain Regarding the GSEs?

Bloomberg’s Awful Comment; What Can We Say For Certain Regarding the GSEs?

we should mention that the conservative think tanks spent the 2000s saying the exact opposite of what they are saying now, and the opposite of what Bloomberg said above. They argued that the CRA and the GSEs were getting in the way of getting risky subprime mortgages to risky subprime borrowers. My personal favorite is Cato’s Should CRA Stand for “Community Redundancy Act?”, (2000, here’s a writeup by James Kwak), arguing a position amplified in Cato’s 2003 Handbook for Congress Financial Deregulation Chapter: “by increasing the costs to banks of doing business in distressed communities, the CRA makes banks likely to deny credit to marginal borrowers that would qualify for credit if costs were not so high.”

Amazing. Yet this lie about the CRA causing the sub-prime crisis persists.

Flat Tax

Two thoughts on flat taxes There is no reason why you need to have a flat tax before you cut any loop-holes. Cutting loop holes and simplifying the tax code can be done without making the tax rates flat or even flatter. If you think the hardest of doing your taxes is the part where… Continue reading Flat Tax

The Copernican Revolution In Macroeconomics

My view, with both all due respect and all due derision, is that the Robert Lucas types are like the early Copernicans here. There’s something admirable in their insistence that it ought to all work out to an easily modeled system grounded in compelling theoretically considerations. The New Keynesian model is a mess, like late-Ptolemaic… Continue reading The Copernican Revolution In Macroeconomics

How Yelp is killing chain restaurants

First, “a one-star increase in Yelp rating leads to a 5-9 percent increase in revenue.” No surprise, good reviews help restaurants. Second, this mainly affects smaller, independent establishments. A Yelp review has no effect on an individual chain restaurant like Applebee’s, presumably because people already have firm impressions of those places. From The Washington Post… Continue reading How Yelp is killing chain restaurants