M2 Growth Falls to 3.7%; Can That Signal Inflation?
Professor Mark J. Perry's Blog for Economics and Finance
Read an interesting WSJ editorial about an unbelievable new scheme in Michigan that forces compulsory union membership on self-employed child care providers to "essentially throw a cash lifeline to unions like the UAW, which are hemorrhaging members."
College admissions directors curious about the experience of touching a third rail can review what happened when the president of the University of Alberta suggested that Canadian males, including white males, needed a helping hand. She got fried ... by her own students.
HT: Nick Schulz
I took some criticism for the post below comparing the amount of durable goods manufactured in the U.S. in November to the entire annual output of goods and services (GDP) in some other countries. Perhaps I wasn't clear enough in my comparison, but I was trying to make the point that we lose sight of the ridiculous size of the U.S. economy ($14 trillion of annual output) and one way to put it in perspective is to show that just the manufacturing output (ignoring services and government) in the U.S., in just one month (ignoring the other 11), is about the same amount of output for all goods and services over the entire 12 months in many countries like Singapore, Chile and the Philippines.
CENSUS BUREAU -- Shipments of manufactured durable goods in November, up three consecutive months, increased $0.5 billion or 0.3 percent to $175.9 billion.
Christmas begins about the first of December with an office party and ends when you finally realize what you spent, around April fifteenth of the next year.
I'm in a trendy DC restaurant in the Woodley Park neighborhood, sitting at the bar, watching an overweight bartender munching down on a large pizza about three feet from me (it's so close I could reach over and help myself to a slice, and this is at least the second time this has happened here). Am I crazy, or isn't this totally inappropriate? Hey, I'm not 100% sure of restaurant etiquette, so using my laptop to check the "perfect recall of silicon memory," aka the Internet (wireless is available here), I found this in about 15 seconds from the NY Times:
1. Scott Jagow at Marketplace writes about his recent experience getting "Fast, Cheap, and Happy Health Care" at a Minute Clinic.
3. Minute Clinics have become the de facto "nation's pharmacy" by offering H1N1 vaccinations on demand, seven days a week with no appointment necessary at its clinics around the country in 20 states and the District of Columbia.
1. Florida’s existing home sales rose in November, marking 15 months that sales activity has increased in the year-to-year comparison, according to the latest housing data released by Florida Realtors.
Here’s some pretty grim news about U.S. manufacturing -- employment in that sector fell below 12 million this year for the first time since 1946, and is now at the lowest level (11,648,000 manufacturing jobs in November) since March of 1941 (see chart, BLS data here). Since the onset of the recession in December 2007, manufacturing employment fell for 24 consecutive months, as the U.S. economy shed an average of 89,000 manufacturing jobs each month for the last two years.
Here are some amazing close-up photographs of frost on a very cold window in a house in Minneapolis when it was 30 degrees below zero, highlighting the natural beauty of early morning sunlight streaming through the frost, captured from inside the house by Minneapolis photographer and musician Marcus Wise:
When it comes to the financial crisis of 2007-2009, the month of October 2008 was "Ground Zero," by several measures:
When a business accused of fraud begins shredding its memos and deleting its e-mails, the media are quick to proclaim these actions as signs of guilt. But, after the global warming advocates began a systematic destruction of evidence, the big television networks went for days without even reporting these facts, much less commenting on them.
The chart above helps to answer the question "Where does all the tuition go?" (see post below).
WSJ -- A closely watched bond-market measure of investor optimism hit a record Monday, amid signs the U.S. economy's recovery is strengthening. That measure is the yield curve -- the difference between short-term and long-term interest rates on government bonds. That number is at its highest level ever, surpassing the record set in June, and signals that investors are expecting a stronger economic turnaround ahead.
St. Louis Post-Dispatch -- The Rams aren't the only ones having trouble selling tickets to their games. For the scalpers on the streets outside the Edward Jones Dome, the ticket market is every bit as sluggish.
Barack Obama's quest for historic health-care legislation has turned into a parody of leadership. We usually associate presidential leadership with the pursuit of goals that, though initially unpopular, serve America's long-term interests. Obama has reversed this. He's championing increasingly unpopular legislation that threatens the country's long-term interests. "This isn't about me," he likes to say, "I have great health insurance." But of course, it is about him: about the legacy he covets as the president who achieved "universal" health insurance. He'll be disappointed.
Even if Congress passes legislation -- a good bet -- the finished product will fall far short of Obama's extravagant promises. It will not cover everyone. It will not control costs. It will worsen the budget outlook. It will lead to higher taxes. It will disrupt how, or whether, companies provide insurance for their workers. As the real-life (as opposed to rhetorical) consequences unfold, they will rebut Obama's claim that he has "solved" the health-care problem. His reputation will suffer.
The various health-care proposals represent atrocious legislation. To be sure, they would provide insurance to 30 million or more Americans by 2019. People would enjoy more security. But even these gains must be qualified. Some of the newly insured will get healthier, but how many and by how much is unclear. The uninsured now receive 50 to 70 percent as much care as the insured. The administration argues that today's system has massive waste. If so, greater participation in the waste by the newly insured may not make them much better off.
So Obama's plan amounts to this: partial coverage of the uninsured; modest improvements (possibly) in their health; sizable budgetary costs worsening a bleak outlook; significant, unpredictable changes in insurance markets; weak spending control. This is a bad bargain. Health benefits are overstated, long-term economic costs understated. The country would be the worse for this legislation's passage. What it's become is an exercise in political symbolism: Obama's self-indulgent crusade to seize the liberal holy grail of "universal coverage." What it's not is leadership.
~Robert Samuelson in today's Washington Post
HT: Ron Adams
Led by improvements in production-related and employment-related indicators, the Chicago Fed National Activity Index increased to –0.32 in November, up sharply from –1.02 in October. Two of the four broad categories of indicators that make up the index improved, although only the production and income category made a positive contribution.
1. Detroit Mayor Dave Bing in the WSJ: "Today in the city of Detroit, our union employee benefits cost 68% of what their base wage is. I don't think that happens in any other place in the country." To give a sense of how excessive those pay packages are, he adds, "When you look at one of the most dominant labor unions in the world, the UAW, they're nowhere close to what we give our city workers."
NY TIMES -- The hiring of temporary workers has surged, suggesting that the nation’s employers might soon take the next step, bringing on permanent workers, if they can just convince themselves that the upturn in the economy will be sustained. Last month 52,000 temps were added, greater than the number of new workers in any other category. Not even health care and government, stalwarts through the long recession, did better. The unemployment rate fell in 36 states in November partly because of the growing use of temps.
MP: After falling for nineteen consecutive months from January 2008 to July 2009, the number of temporary jobs has now increased in each of the last four months, and the 52,400 increase in November was the largest monthly increase in more than five years (since October 2004).
HT: Erik Babosci
Cost of a Gateway laptop with 12.1-in. display, 550MHz chip and a year of free AOL in 2000: $1300 ($1633 in today's dollars)
NY TIMES -- Stung by criticism that their megastores shutter mom-and-pop shops, Wal-Mart officials are offering to rent space in the lobby of a new Chicago store to neighborhood businesses. Wal-Mart’s tenants already include a dog groomer at a store in north suburban Zion and an Uncle Remus fried chicken outlet in its only Chicago store, on the West Side.