Edward Lambert at Effective Demand; Effective Demand = Effective Labor Income/(cu*(1-u)) points to the result of an economy left to maximize Profits at the expense of Labor. I have my own version or underlying causes of this issue and Edward gives the economic side of it. I am going to show a graph of Productivity […]
Lifted from comments from reader Juan: Where Did the Risk Go? How Misapplied Bond Ratings Cause Mortgage Backed Securities and Collateralized Debt Obligation Market Disruptions Joseph R. Mason. Louisiana State University – Ourso School of Business; University of Pennsylvania – Wharton Financial Institutions Center and Josh Rosner, Graham Fisher & Co. May 3, 2007 […]
by Linda Beale Corporations Never Had It So Good The press is covering the GAO‘s latest report on corporate taxes: Corporate Income Tax: Effective Tax Rates Can Differ Significantly from Statutory Rate(May 30, 2013). The study, looking at income and taxes reported in financial filing statements for 2008-2010, was conducted because Proponents of lowering the […]
by Linda Beale Senate Finance Leaders push “blank slate” to tax reform Senators Baucus and Hatch, the Chair and ranking minority member of the Senate Finance Committee, respectively, launched a bid for completing a Code reform before Baucus leaves office with a letter to Senators telling them that they should get their bids in within […]
Lifted from comments by reader Juan comes this article from the Finacial Times: Subprime securities – still being downgraded Some two weeks ago Moody’s announced it was downgrading 28 tranches of various bonds (as well as upgrading two tranches, and confirming others) in an action that covered roughly $1.2bn worth of mortgage-backed securities (MBS). … […]
Congress is in recess, actual recess with no pro forma sessions. Barack Obama can recess appoint people. Tomorrow Ed DeMarco could cease to be acting director of the FHFA (Federal Housing Finance Agency). I think that Obama should, indeed must, recess appoint Mel Watt to be FHFA director. As acting director DeMarco has blocked all […]
Via Mark Thoma Economist’s View comes this note on credit rating company incentives: While the US Department of Justice did not give any statistical evidence in its deposition, our new research (Efing and Hau 2013) suggests that rating favors were indeed systematic and pervasive in the industry. In a sample of more than 6,500 structured […]
Political Calculations gives us this chart of median new home prices versus median incomes over the last 46 years. The rising tip at the upper right (!) is May 2013. What do you think: sustainable? Here’s the zoomed-in version of recent years, from inside the red dashes: As they say, …new homes are, virtually by definition, at the […]
by Linda Beale Redistribution and public production of public goods–not “let the markets handle it” In recent posts, the Importance of Distribution and Markets, Minimum Wages, and the Sins of Friedmania, I have noted the centrality to sustainable democratic institutions of corraling the market so that the power and wealth of the elite few does […]
by Linda Beale UK Territories to sign OECD Tax Info-Sharing Agreement, Reveal Beneficial Owners The UK’s David Cameron announced that Britain’s 10 crown dependencies and overseas territories–Cayman Islands, Bermuda, Jersey, Gilbraltar, Anguilla, Turks and Caicos Islands, Guernsey, Isle of Man, and the British Virgin Islands–would sign on to the OECD’s multilateral convention on Mutual Administrative […]