The economy contracted at a 1.0% pace in the second quarter, according to the advance estimate from the Bureau of Economic Analysis. That’s bad, of course, but much better than the 5.4% and 6.4% pace of declines in the two previous quarters. Whenever the GDP data come out, the first thing I look at is [...]
Archive for July, 2009
Broad Weakness in Q2 GDP
Posted in Data, Economy, Macroeconomics, tagged Data, GDP, Investment, Macroeconomics on July 31, 2009 | 10 Comments »
The Budget Battle Over Student Loans
Posted in Budget, Finance, Politics, tagged Budget, CBO, Finance, Politics, Student Loans on July 30, 2009 | 9 Comments »
Summary: President Obama and congressional Democrats have good reasons for wanting to eliminate federal guarantees for private student loans. They should keep in mind, however, that the resulting budget savings will likely be much smaller than official estimates suggest. Health care and defense spending have grabbed most of the budget headlines lately, but they aren’t the [...]
Follow-up: Defense, Mortgage Modifications, and Yahoo/Microsoft
Posted in Budget, Economy, Finance, Internet, Macroeconomics, Politics, Regulation, Technology, tagged Antitrust, Budget, Defense, Finance, Microsoft, Mortgage, Politics, Search, Yahoo on July 30, 2009 | Leave a Comment »
This morning’s headlines include some important follow-ups to recent posts: I recently cheered the Obama administration’s success (so far) in fighting off excess spending on the F-22 fighter. However, business-as-usual is still the rule in Washington, as the Washington Post reports that the House will soon vote on a defense appropriations bill that is loaded [...]
Bing Bounces Onto Yahoo
Posted in Internet, Regulation, Technology, tagged Antitrust, Google, Microsoft, Search, Yahoo on July 30, 2009 | Leave a Comment »
Yesterday’s deal between Microsoft and Yahoo is a big boost for Bing. Microsoft’s new engine will power search on Yahoo, raising its visibility and, perhaps, eating into Google’s market leadership. If the stock market is any guide, Microsoft is getting the better of the deal. As Techcrunch notes, Yahoo’s stock fell 12% on the day, [...]
Why Are Banks Holding So Many Excess Reserves?
Posted in Economy, Finance, Macroeconomics, tagged Banks, Federal Reserve, Finance, Interest, Macroeconomics on July 29, 2009 | 8 Comments »
That’s the question posed by a recent staff report from Todd Keister and James McAndrews at the New York Federal Reserve. Their answer? Because the Federal Reserve has been really, really busy. Keister and McAndrews begin their analysis by documenting the remarkable increase in excess reserves since the fall of Lehman: Since September 2008, the [...]
The Problem with Loan Modifications
Posted in Economy, Finance, Macroeconomics, tagged Finance, Housing, Macroeconomics, Mortgage on July 28, 2009 | 8 Comments »
Over the past two years, many policymakers have identified loan modifications as key to fighting the mortgage crisis. The rationale for encouraging modifications appears quite simple: foreclosure is expensive for both the borrowers (who lose their home and their credit worthiness) and lenders (who often recover only a fraction of what they are owed). It [...]
Good and Bad News for the House Health Bill
Posted in Budget, Health, Politics, tagged Budget, CBO, Health, Politics on July 28, 2009 | 1 Comment »
In my recent paper about how the Congressional Budget Office analyzes health proposals, I noted that one of the most important things that CBO does is to provide additional information about its cost estimates. Cost estimates often can’t speak for themselves, so it’s important that members of Congress and other interested observers ask for additional [...]
A Note on End-of-Life Health Care
Posted in Health, Life, tagged Health on July 27, 2009 | 7 Comments »
It’s often said that end-of-life care makes up a disproportionate share of overall health care spending. For one very thoughtful discussion, see this article in Daily Finance. Such claims strike me as plausible as an after-the-fact accounting matter. But I’ve always wondered how often patients and their caregivers know that they are providing end-of-life care? [...]
Bailout by Merle Hazard
Posted in Economy, Finance, Macroeconomics, tagged Finance, Humor, Macroeconomics on July 27, 2009 | 1 Comment »
Merle Hazard is the world’s leading (and only) country singer who sings about the financial crisis. Merle released his latest yesterday, “Bailout”: Merle’s production values have improved, so business must be good. My personal favorite continues to be “Inflation or Deflation”:
Another Budget Blow to Health Reform
Posted in Budget, Health, Politics, tagged Budget, CBO, Health, Politics on July 25, 2009 | 4 Comments »
Policymakers are discovering that the road to health care reform in anything but smooth. The latest speed bump involves the Administration’s proposal to rein in future Medicare costs by empowering a new panel (the Independent Medicare Advisory Council) to recommend future spending reductions. If accepted by future Presidents, the commission’s recommendations would take effect unless [...]
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