Category Archive: United States
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The Stealth Problem of Predatory Mortgage Modifications
If you look from 50,000 feet, there are two sides to the debate over mortgage modifications. On the one hand, a surprisingly large group, which includes beleaguered homeowners, mortgage investors and town and municipal governments, all favor mortgage modifications, particularly principal modifications. Their argument is simple. If you are dealing with a big enough loan, [...]
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A Failure to Act: Fed Policy and Interest Rates
Is the Fed responsible for the pernicious low-interest rate environment? Yes, but not for the reasons you think. I explain why in a new National Review article: While this absolves the Fed of direct responsibility for the low-interest-rate environment, it does not absolve it for its indirect influence. Through its control of the monetary base, the Fed can [...]
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April Was A Rough Month For Spending & Income
Consumer spending and disposable personal income declined last month, the US Bureau of Economic Analysis reports. That’s a worrisome sign because the annual rate of growth for both indicators has been trending lower for two years. The margin of comfort, in other words, is wearing thin, and today’s report doesn’t offer much in the way of [...]
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Reframing the Debate: Not That Most Americans Have Been Living Beyond Our Means, But Our Means Haven’t Kept Up Because of Widening Inequality
Even as the economy slowly recovers from the worst downturn since the Great Depression, government-haters and deficit-hawks are sticking to their same story: Americans have lived beyond their means and must now learn to live within them. The reality is quite different: The means of most Americans haven’t kept up with what the economy could [...]
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Latest US GDP Numbers Confirm Consumer-Led Expansion but Government and Exports were Weaker than Previously Thought
The second revision of GDP data released today by the Bureau of Economic Analysis confirmed that the U.S. economy expanded at a moderate 2.4 percent annual rate in the first quarter of 2013. The figure for overall growth was almost unchanged from the 2.5 percent of last month’s advance estimate. However, there were significant changes [...]
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‘The Left-Right Divide in U.S. Politics’
Dean Baker: Krugman Misrepresents the Left-Right Divide in U.S. Politics: In his contribution to the debate over whether there is a group of open-minded “reformed” conservatives, Paul Krugman misrepresents the central focus of the left-right divide in national politics. He tells readers: “Start with the proposition that there is a legitimate left-right divide in U.S. politics, built [...]
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A Subtle View of Labor Market Improvement
In a speech delivered Tuesday to the Japan Society in New York City, Federal Reserve Bank of New York President William Dudley offered his view on how he might assess the appropriate pace of the Federal Open Market Committee’s (FOMC) current $85 billion per month asset purchase program: Let me give a few examples of how my [...]
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Why Democrats Can’t be Trusted to Control Wall Street
Who needs Republicans when Wall Street has the Democrats? With the help of congressional Democrats, the Street is rolling back financial reforms enacted after its near meltdown. According to the New York Times, a bill that’s already moved through the House Financial Services Committee, allowing more of the very kind of derivatives trading (bets on bets) [...]
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And Then There is Bernanke
Lots of Fed chatter in the last week. For openers, some background from Reuters: It decided on May 1 to keep buying at an $85 billion monthly pace, and many economists say mixed economic data warrants keeping up the purchases through year-end. But persistent warnings from more hawkish Fed officials had fanned talk that it might [...]
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Corporate Taxes: Don’t Beat Up on Apple: The Flaw is in the Law
This week it was the turn of Apple’s Chief Executive Tim Cook to sit in the Congressional hot seat. With lights blazing and cameras rolling, a bipartisan lineup of Senators grilled him about the relatively small amount of tax the company pays on its substantial corporate profits. According to a New York Times account of [...]
