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Limits of laws

In what contexts are there limits to what can be done by laws and contracts? It’s clear that there are such limits. As Oliver Hart and Ronald Coase (pdf) pointed out, it can be prohibitively expensive or perhaps even impossible...

Zillow Case-Shiller Forecast: More Solid House Price Gains in January

The Case-Shiller house price indexes for December were released on Tuesday. Zillow forecasts Case-Shiller a month early, and I like to check the Zillow forecasts since they have been pretty close.From Aaron Terrazas at Zillow: December...Show More Summary

Free speech after Mill

We need to reconsider the case for free speech, because the classical liberal case for it is questionable. Robert Sharp recently echoed John Stuart Mill when he said: Our own opinions, beliefs and values should always be tested, less they...

Market Update

Friday:• At 10:00 AM, University of Michigan's Consumer sentiment index (preliminary for February). The consensus is for a reading of 99.5, down from 99.9 in January. Click on graph for larger image. By request - following the market sell off today - here is a stock market graph. Show More Summary

Beware Covert War Morality Tales

For years I’ve been saying that fiction is mainly about norm affirmation: Both religion and fiction serve to reassure our associates that we will be nice. In addition to letting us show we can do hard things, and that we … Continue reading ?

Paul Krugman on Temporary vs Permanent Monetary Injections

Paul Krugman looks back on the past twenty years of macroeconomic policy and finds that his 1998 paper was more prescient than he or anyone could have imagined. Back then many observers assumed that central bankers--particularly those at the Bank of Japan--need only increase the monetary base to increase the price level. Show More Summary

U.S. Light Vehicle Sales mostly unchanged at 17.1 million annual rate in February

Based on a preliminary estimate from AutoData, light vehicle sales were at a 17.08 million SAAR in February.That is down 1.4% year-over-year from February 2017, and down slightly from last month. Click on graph for larger image. This...Show More Summary

Bad-News Boxes

Many firms fail to pass bad news up the management chain, and suffer as a result, even though simple fixes have long been known: Wall Street Journal placed the blame for the “rot at GE” on former CEO Jeffrey Immelt’s … Continue reading ?

Fed Chair Jay Powell on Monetary Policy Rules

Jay Powell went to Capitol Hill today for his first congressional testimony as Fed Chair. In addition, he submitted the Federal Reserve's annual Monetary Policy Report to Congress. A lot of ground was covered in his testimony, follow-up questions, and in the report. Show More Summary

Construction Spending mostly unchanged in January

Earlier today, the Census Bureau reported that overall construction spending was mostly unchanged in January:Construction spending during January 2018 was estimated at a seasonally adjusted annual rate of $1,262.8 billion, nearly the same as the revised December estimate of $1,262.7 billion. Show More Summary

ISM Manufacturing index increased to 60.8 in February

The ISM manufacturing index indicated expansion in February. The PMI was at 60.8% in February, up from 59.1% in January. The employment index was at 59.7%, up from 54.2% last month, and the new orders index was at 64.2%, down from 65.4%.From...Show More Summary

Personal Income increased 0.4% in January, Spending increased 0.2%

The BEA released the Personal Income and Outlays report for January: Personal income increased $64.7 billion (0.4 percent) in January according to estimates released today by the Bureau of Economic Analysis. Disposable personal income...Show More Summary

Latest Richmond Fed Non-Employment Index Shows US GDP at or Close to Potential

The Richmond Fed has released the latest reading of its Hornstein-Kudlyak-Lange Non-Employment Index (NEI). At 7.93 percent, the NEI has now fallen below its pre-recession minimum of 7.99 percent, reached in March, 2007, and it is fast approaching the value of 7.70 percent reached in October 2000, just before the 2001 recession. Show More Summary

Fannie Mae: Mortgage Serious Delinquency rate decreased slightly in January

Fannie Mae reported that the Single-Family Serious Delinquency rate decreased to 1.23% in January, down from 1.24% in December. The serious delinquency rate is up from 1.20% in January 2017.These are mortgage loans that are "three monthly payments or more past due or in foreclosure". Show More Summary

NAR: Pending Home Sales Index Decreased 4.7% in January, Down 3.8% Year-over-year

From the NAR: Pending Home Sales Stumble 4.7 Percent in JanuaryAfter seeing a modest three-month rise in activity, pending home sales cooled considerably in January to their lowest level in over three years, according to the National Association of Realtors®. Show More Summary

Q4 GDP Revised down to 2.5% Annual Rate

From the BEA: Gross Domestic Product: Fourth Quarter and Annual 2017 (Second Estimate) Real gross domestic product (GDP) increased at an annual rate of 2.5 percent in the fourth quarter of 2017, according to the "second" estimate released by the Bureau of Economic Analysis. Show More Summary

Wednesday: GDP, Pending Home Sales, Chicago PMI

Wednesday:• At 7:00 AM ET, The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.• At 8:30 AM, Gross Domestic Product, 4th quarter 2017 (Second estimate). The consensus is that real...Show More Summary

Freddie Mac: Mortgage Serious Delinquency Rate Decreased Slightly in January

Freddie Mac reported that the Single-Family serious delinquency rate in January was 1.07%, down from 1.08% in December. Freddie's rate is up from 0.99% in January 2017.Freddie's serious delinquency rate peaked in February 2010 at 4.20%. Show More Summary

Real House Prices and Price-to-Rent Ratio in December

Here is the earlier post on Case-Shiller: Case-Shiller: National House Price Index increased 6.3% year-over-year in DecemberIt has been more than ten years since the bubble peak. In the Case-Shiller release this morning, the seasonally adjusted National Index (SA), was reported as being 7.0% above the previous bubble peak. Show More Summary

Is Mexico now targeting the forecast?

Commenter HL directed me to this slide from a presentation by the Mexican central bank: HL suggested that this meant the Bank of Mexico is now “targeting the forecast”.  It does sort of suggest that policy is being adopted, but it’s hard for me to be sure.  Any comments would be welcome. Let’s recall the […]

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