Relevant and even prescient commentary on news, politics and the economy.

Jared Bernstein’s “new normal” potential GDP is similar

Today Jared Bernstein published a graph with a red line representing a new normal for potential GDP. I was surprised because the line looks very similar to the line I have been publishing for months for effective demand. Mr. Bernstein does not give an equation for his line, but only a definition… “The other two […]

Taxes And Income Distribution: The Way It Was And The Way It Is

Via Econospeak Barkley Rosser ponders taxes and distribution: Taxes And Income Distribution: The Way It Was And The Way It Is Got invited on to the local TV station today to discuss income distribution thanks to the recent statements about the matter by President Obama and Pope Francis, only to upset the local anchorman by telling […]

Temp workers and injury

Pro Publica points us to the expendable temp worker trend and with data. Via Truth out comes more: A groundbreaking 2010 study of Washington state’s workers’ comp claims found that temp workers in construction and manufacturing had twice the claims rate of regular workers doing the same type of work. It’s not possible to track […]

Sunday Reads

Senator Elizabeth Warren introduces bill to stop credit checks in job application process “A bad credit rating is far more often the result of unexpected medical costs, unemployment, economic downturns, or other bad breaks than it is a reflection on an individual’s character or abilities,” Senator Warren said. “Families have not fully recovered from the […]

Trans Pacific Partnership

Trans Pacific Partnership is Not Especially Important Paul Krugman argues that the Trans Pacific Partnership is no big deal: I’ve been getting a fair bit of correspondence wondering why I haven’t written about the negotiations for a Trans Pacific Partnership… The answer is that I’ve been having a hard time figuring out why this deal […]

In defense of Greenspan on Solow’s criticism

Robert Solow wrote an article about Greenspan, his successes and his mistakes, Alan Greenspan Is Still Trying to Justify His Bad Decisions; What the maestro doesn’t understand. Even though I agree with what Solow said about Greenspan’s early years, I want to defend Greenspan during the years after the 2001 recession. There was something not […]

HOW MUCH INTEREST DOES SOCIAL SECURITY PAY?

By Dale Coberly HOW MUCH INTEREST DOES SOCIAL SECURITY PAY? A reader asked what interest does Social Security pay on your “investment”?  I think it is important to realize that this is not the important question about Social Security.  Social Security is an insurance program and it doesn’t make any more sense to talk about […]

Tapering going to happen… Good decision

I have been waiting for the Fed to reverse its loose monetary policy. I am in total favor of it. A move to $75 billion per month is a well balanced decision. They waited too long and they are way behind the curve but tapering has finally started. Good to see it.

Tapering would raise borrowing… Forward guidance needs some psychological bite

An article came out in the WSJ web site called Lenders Look to Fed Tapering to Lift Business Borrowing. One would think that tapering would discourage borrowing. Yet, we are in a situation where long-term low interest rates suppress borrowing. Here is the key line from the article referring to tapering… “Such a move would […]

Antonio Fatas Has 4 Excellent criticisms of Current Macroeconomic Research

The post is too good to excerpt so just go read it. To edit ruthlessly 1. The business cycle is not symmetric. [skip] 2. As much as the NBER methodology emphasizes the notion of recessions (which, by the way, is asymmetric in nature), most academic research is produced around models where small and frequent shocks […]