Booming Business-School Applications
THE ECONOMIST -- Applications for full-time Master of Business Administration (MBA) programs are booming.
Professor Mark J. Perry's Blog for Economics and Finance
The health of the global economy used to rest on the back of the American consumer. Now it will rely on the Chinese.
US News and World Report -- After months and months of painful data, economists said there is a sliver of sunshine in a housing report released today.
USA Today -- The Labor Department said Thursday that new applications for unemployment insurance rose a seasonally adjusted 7,000 to 455,000 for the week ended Aug. 2, the highest level since March 2002.
…building a portfolio around index funds isn’t really settling for average. It’s just refusing to believe in magic.
The U.S. dollar index for major currencies (data here) came close to a 6-month high yesterday, reaching the highest level since mid-February. Forward markets are pricing the dollar at $1.9071/BP (+2.24% premium) and $1.5166/Euro in one year (+1.64% premium), vs. $1.9507/BP and $1.5419/Euro currently.
Results of a statistical experiment, to follow up on these two CD posts(link and link):
Boone Pickens says we spend $700 billion a year on foreign oil, which he calls a "transfer of wealth." But exchanging money for oil at the market price is an exchange of things of equal value. If we didn't value their oil more than our dollars, we wouldn't participate in such a bargain (MP: ECON 101).
This CD post (about T. Boone Pickens' rantings about oil and the "biggest transfer of wealth in history") was read today in its entirety on the Rush Limbaugh radio show (transcript here).
Exxon Mobil reported the highest quarterly profit ever and is the main target of any "windfall" tax surcharge. Yet if its profits are at record highs, its tax bills are already at record highs too. Between 2003 and 2007, Exxon paid $64.7 billion in U.S. taxes, exceeding its after-tax U.S. earnings by more than $19 billion. That sounds like a government windfall to us, but perhaps we're missing some Obama-Durbin business subtlety.
According to yesterday's BEA report (Table 10), real disposable personal income increased in June by 3.4% compared to June last year, following a 6.4% annual increase in May (see chart above). Both growth rates (May and June) were above the 2.6% average growth in real disposable income since 2001, following 7 months (October 2007 to April 2008) of below-average growth (see chart above).
The chart above shows 2006 income shares from the IRS, and medal shares at the 2004 Summer Olympics. Notice the amazing similarity? For example, the top 5% of U.S. taxpayers earned 36% of all income, and the top 5% of the 74 medal-winning countries (the top three: U.S., Russia, and China; and 70% of fourth place Australia's points to total 3.7 countries) won about 33% of the total medal points (598.3 out of 1832).
According to these IRS data, the top 50% of U.S. taxpayers earned 87.3% of all income in 2006, and paid 96.89% of all income taxes.
McCain's odds on Intrade.com (click chart to enlarge).
BusinessWeek has an interesting slide show and article about the "Real Estate Boom and Bust in the Same Metro Areas" (article here) which looks at the best- and worst-performing zip codes in the 20 largest metro areas. EconomicPicData blog summarizes the BusinessWeek data in the chart above.
Americans are not suffering from weak or negative economic growth. They have suffered a loss of wealth, a very different ailment, from two major factors. The first is high oil prices, the equivalent of a huge tax increase. The second is the housing bust, which has vaporized more than a trillion dollars worth of assets.
Update: The chart above is from the Joint Economic Committe (based on 2006 IRS data), showing the percentages of federal personal income tax paid by different groups of taxpayers: The top 1% of taxpayers pay about 40% of all income taxes, the top 10% pay 71%, and the top 50% pay 97% of all taxes. The bottom 50% pays less than 3% of all income taxes paid.