Though Liberals Carp at Chained CPI, Pelosi Says She Could Live With It

By: Tuesday December 18, 2012 2:20 pm

Many of what would be described as the liberal left of Congress have weighed in against using the chained CPI to calculate cost of living increases in Social Security benefits. Here’s a representative sample from Sen. Jeff Merkley: We had an election, and the voters sent a message to Congress to focus on jobs and [...]

What Chained CPI Means, and Why a Cut in a Time of Inadequate Social Security Benefits Makes No Sense

By: Monday December 17, 2012 2:45 pm

Let’s just make clear what chained CPI is all about. The idea here is that you should not measure the cost of living simply based on the consumer price index, and then raise the costs accordingly with the rise in prices. Instead, economists say, you have to account for the substitution effect in response to [...]

We Don’t Have a Deficit Problem, Cont’d

By: Monday December 17, 2012 6:59 am

Paul Krugman takes aim at something that should have been a major talking point for progressives, even if lawmakers couldn’t touch it, for the last four years. There has been a void in talking about the budget deficit in real terms, in what it’s composed of and what it really means. First of all, to [...]

Fed Announces Game-Changing Inflation and Unemployment Targets for Monetary Policy

By: Wednesday December 12, 2012 10:45 am

The Federal Reserve adopted an innovative tactic in its latest Federal Open Market Committee report. Instead of merely identifying a target federal funds rate, or giving guidance that rates will remain low for a certain period of time, the Fed now specifically targeted both an unemployment rate and an inflation rate, and said that their [...]

US GDP Rises to 2.7%

By: Thursday November 29, 2012 6:59 am

The Commerce Department revised its estimate of GDP in the third quarter up to 2.7%, a substantial gain from the initial estimate and an indication that the economy grew at a solid clip in the months leading up to the Presidential election, putting wind at the back of President Obama. This represents the fastest economic [...]

Retail Wage Increases Would Benefit Entire Economy and Additional Retail Sales, With Negligible Price Increase

By: Monday November 19, 2012 10:00 am

Walmart executives worried about the recent spate of labor activity against the retailer would probably tell you that they cannot possibly offer higher wages to their employees while maintaining their brand identifier of low prices. They offer what the market will bear in terms of wages, they would say, and anything more would represent a [...]

Janet Yellen’s Game-Changing Speech for Monetary Policy

By: Wednesday November 14, 2012 12:00 pm

The President opened his press conference by designating the top two priorities as jobs and growth, and then spent the next 60 minutes answering questions about David Petraeus and Susan Rice and tax rates and Benghazi and deficit reduction. And Obama didn’t seek to break out of that constraint and suggest actual near-term job creation [...]

Leading Fed Inflation Hawk Now Thinks Central Bank Not Doing Enough

By: Wednesday October 31, 2012 9:15 am

It wasn’t so long ago that Narayana Kocherlakota, the President of the Minneapolis Federal Reserve, was the leader of the coalition arguing for tighter monetary policy, even in the middle of mass unemployment. He claimed that unemployment was structural in nature, and that we risked runaway inflation with ultra-low interest rates. Just a year or [...]

Talk Rises About Sovereign Debt Cancellation

By: Monday October 22, 2012 6:58 am

It’s an intriguing question: why can’t central banks around the world, practically all of whom have bought up sovereign debt, just cancel it? Countries would get more headroom on their debts, inflation would rise but not necessarily at an unmanageable rate. It would have the effect of hitting the reset button.

As Sanctions Take Effect, Iranian Economy Starts to Collapse, Fueling Unrest

By: Wednesday October 3, 2012 9:42 am

Reports indicate fresh clashes with riot police inside Tehran, Iran today, but they do not have necessarily the same rationale as the Arab uprising. These stem from the collapse of the Iranian currency, a direct result of international sanctions on the Islamic Republic over their nuclear program. Clashes erupted in the center of the Iranian [...]

Influential Regional Fed President Concedes Need for Monetary Action Against Unemployment

By: Friday September 21, 2012 6:15 am

I don’t know whether this is a positive sign about policymakers recognizing the depth of our economic problems, or a negative sign about the depth of our economic problems. But the President of the Minneapolis Federal Reserve, Narayana Kocherlakota, set a target unemployment rate he would like to see before the Fed raises the federal [...]

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