Econ70
While the Fed has increased the money supply by $2 trillion and will increase it by another $1 trillion by 1/1/14, inflation is MIA. This is because the velocity of money, or the number of times a dollar changes hands…
Read MoreAccording to CoreLogic, house prices rose 7.4% for the 12 months ending 11/12 (6.7% excluding short sales), the best numbers since 5/06! With 30-year mortgage rates at 3.4%, this means that the real cost of financing a home is NEGATIVE…
Read MoreBecause households irrationally assign fixed amounts to budget categories such as clothes or food, price changes within a category can result in bizarre behavior; case in point, gasoline. Seems a rise in gas prices (which reduces purchasing power) causes households…
Read MoreWhile the economy is improving, inflation is MIA. Wages adjusted for inflation were up just 0.3% in 2012 after falling 1% in 2011. Meanwhile, the CPI and core CPI (excluding food and energy) were up 1.7% and 1.9% respectively in…
Read MoreBy raising marginal tax rates for the upper 1% of the population from 35% to 39.6%, passage of the fiscal cliff avoidance bill will encourage increased charitable giving by the rich because it’s cheaper! To be precise, it’s 7.8% cheaper…
Read MoreIn 2009, the budget deficit hit a post WWII record of 10.1% of GDP as receipts fell to a 60-year low of 15.1% of GDP, while outlays hit a 60-year high of 25.2%. Only between 1942 and 1945 has the…
Read MoreThe Friday File: Researchers find that being overweight (BMI between 25 and 30) surprisingly lowers risk of death by 6%, and having a BMI between 30 and 35, by 5%! While no one knows why, health experts are spinning like…
Read MoreJames McGill Buchannan, winner of the 1986 Nobel Prize in economics, died earlier this week. He was best known for promoting public choice theory, an approach which treats politicians and bureaucrats as utility-maximizing economic agents motivated by self-interest. Rather than…
Read MoreTotal debt service payments as percentage of disposable income have fallen from a peak of 14.1% in 7/07 to just 10.6% today, a level last seen in 10/93; a decline of 25%. This is due to a combination of low…
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