California’s fiscal crisis has left the US state without courts and some administration offices were ordered to close on Friday. A predicted 24 billion dollar budget deficit over the next two years has forced Governor Arnold Schwarzenegger to order massive cost-cutting measures. — California closes state offices to save cash There is no more new frontier We have got to make it here — The Eagles, “The Last Resort” All the economic news from here in California is bad and unfortunately the cry heeded by our forbears — “Go West!” — is no longer an option . . . Read more →
EppsNet Archive: Economics
Feeling the Pinch
Microblog: 2009-05-01
As the President intervenes in more and more industries, a key question is how he does it and what he is trying to achieve http://is.gd/vLUl # Read more →
Signs of the Times
The house two doors down from us is for sale. The house across the street is empty and for sale. The woman behind us and the woman next door, who was recently laid off, have asked my wife if she knows anything about loan modification . . . Read more →
Two Bright Spots in the Recessionary Landscape
Fewer kids in day care More women in porno Read more →
Tweets on 2009-03-30
Offering and accepting only rational, results-oriented behavior and communication: http://tinyurl.com/5z2rg6 # Financial collapse shows failure of free markets? http://tinyurl.com/cmoqqw # Diners can ‘have a ball’ at testicle festival: http://www.modbee.com/weird/story/645349.html # Obama to Back GM Warranties, OnStar Operator Service: http://tinyurl.com/c8k4xz # In Fargo, goodwill runs as deep as the river: http://www.msnbc.msn.com/id/29962032 http://tinyurl.com/cw9o89 # Read more →
Thomas Jefferson on the Financial Meltdown
ALBANY, N.Y. (AP) — If anyone could emerge from the AIG bonus debacle looking good, it could be New York Attorney General Andrew Cuomo. — “NY’s Cuomo wins praise for pursuing AIG on bailout” Cuomo. KWOH-moh. Italian, I suppose. I have no personal animosity toward Mr. Cuomo, but despite his favorable write-ups in the press, he is certainly no hero in these matters. Americans have short memories. Even members of the press — or “the media,” as you now call them — who should provide context and perspective, have short memories. Set the Wayback Machine to 1995. Bill Clinton is president and Henry Cisneros, the Housing and Urban Development (HUD) secretary, institutes a requirement that 42 percent of the mortgages financed by government-sponsored entities (GSEs) Fannie Mae and Freddie Mac serve low- and moderate-income families. Things only got worse under Cisneros’ successor, Andrew Cuomo: Cuomo raised that number to 50… Read more →
Stimulus Bill is Creating Jobs
A friend works at a wind energy company. I asked him if he was getting his share of the money from our new planned economy. His response: “We are stimulated! There is some good stuff in there for renewable. We may need to open a DC office just to chase the $$.” As long as we think that we can grow GDP by having an ever-larger proportion of our best citizens working as full-time lobbyists, it would seem that the stimulus bill is working as advertised. — Philip Greenspun Read more →
You’re Getting Stimulated
OLYMPIA, Wash. — The state is sending out hundreds of thousands of $1 checks to the state’s neediest residents. It’s a plan that’s supposed to bring millions of dollars worth of food stamps to the state by March. When you add printing and postage, it seems like a waste, but the state says the economy has them pulling out all the stops to find money wherever they can. — The Olympian Yeah, it seems like a waste now — but wait till the Keynesian multiplier kicks in! Read more →
The Art of the Possible
The role of the economist in discussions of public policy seems to me to be to prescribe what should be done in light of what can be done, politics aside, and not to predict what is “politically feasible” and then to recommend it. — Milton Friedman Take out the references to economics and public policy and you can probably apply the “what should be done in light of what can be done” approach in your own work. It’s the art of the possible . . . Read more →
Thomas Jefferson on the Stimulus Package
The situation could not be more serious. It is inexcusable and irresponsible for any of us to get bogged down in distraction, delay or politics as usual while millions of Americans are being put out of work. Now is the time for Congress to act. — Barack Obama Bah-loney. The American economy will bounce back as it always has, as surely as day follows night, no matter what anyone does or doesn’t do. The only urgency in passing a stimulus bill (which doesn’t work, as I’ve explained previously) is so President Obama can take the credit for the recovery when it occurs . . . Read more →
Failure is an Orphan
For centuries, historians have debated whether history is propelled by Great Men (and Women), human forces of nature who bend events and systems to their will, or by vast impersonal forces (communism, capitalism, globalization) that render even the most powerful of us a mere reed basket floating in a massive river. There’s no session on the subject at the World Economic Forum in Davos. But at least with regard to finance and business, the consensus seems to be clear: Success is the work of Great Men and Great Women, while failure can be pinned on the system. — Daniel Gross, “Why the world’s economic leaders blame the catastrophe on the system instead of themselves” Read more →
Why Spending Stimulus Plans Fail
Congress doesn’t have its own stash [of money]. Every dollar it injects into the economy must first be taxed or borrowed out of the economy. No new spending power is created. It’s merely redistributed from one group of people to another. — Brian Reidl, The Wall Street Journal As you probably learned in school, we founded this country as a free-market economy and viewed government intervention in the market with the greatest skepticism. The above article is the clearest explanation I’ve seen for why bailouts and “stimulus plans” involving government spending never work. The latest failed companies hoping for a bailout are General Motors and Ford. I hope Henry Ford — a great American like myself, who is currently whirling like a lathe in his Detroit grave — will pardon me for saying so, but these companies are nothing but engines of mass financial destruction. According to the WSJ, GM… Read more →
Aloha, Gary
My wife tells me the Gary’s Island store in Newport Beach is going out of business. I hope it’s not true. It’s a great store, but I suppose in a down economy, high-end Hawaiian shirts are even more of a luxury item than usual . . . Read more →