For much of the past decade, I was a proponent of the thesis that that the American economy had entered a “great moderation,” where expansions lasted longer and recessions were fewer, shorter and milder. Productivity had seemingly reached a permanently high plateau; inflation seemed tamed. The spreading of financial risk, across institutions and around the world, seemed to have reduced the odds of a crisis. read more »
The White House remedies for the mortgage meltdown were presented on Friday. Congress will debate the life extension, death, or rebirth of federal mortgage entities Fannie Mae and Freddie Mac during the coming weeks.
When the noise has died down, don't expect substantial change. But those who hope for genuine financial reform should, nonetheless, listen carefully not only to what Washington says, but to whom it says it. read more »
I admit it. I had low expectations for Jerry Brown’s third term as governor. After seeing his budget proposal, I’m ready to reconsider my expectations. I think it is a great effort, and it deserves the support of all of us tired of seeing our state reduced to laughing stock. read more »
In the next two years, America’s large cities will face the greatest existential crisis in a generation. Municipal bonds are in the tank, having just suffered the worst quarterly performance in more than 16 years, a sign of flagging interest in urban debt. read more »
This week the UK government announced an ”end to anti-car policies” reversing the guidance to local authorities to dissuade citizens from using their cars in favour of public transport. Charges for parking will be reined in, they promise.
It should be good news. The comically-named ”traffic calming” schemes put in place by the outgoing government were deeply unpopular. Still, we are getting used to taking our announcements from the new coalition government with a pinch of salt. read more »
The roadmaps showing the way out of our 1.4 trillion dollar federal deficit almost always begin at the same starting points. During 2010, it became taken-for-granted that today's record-setting red ink is a result of unrestrained government spending — especially stimulus spending. And the idea that the economic upturn in jobs and growth will begin with deficit reduction has become widely perceived as 'common sense'. read more »
Those who are looking for a feel-good stimulus story, notably members of the Obama administration, cite the recent initial public offering (IPO) in which the federal government sold off 28 percent of its General Motors shares for about $15 billion. read more »
Over the weekend I saw the documentary movie Inside Job with a friend who is not a financial markets expert. After the show, I told her I was relieved to see that the movie covered the majority of the causes of the collapse of the financial markets in 2008. Part of my relief was from thinking that everything would be better now that “everyone” knows the facts. Then my friend pointed out that there were only six people in the audience – obviously “everyone” wasn’t seeing this movie! read more »
In the future, historians may likely mark the 2010 midterm elections as the end of the California era and the beginning of the Texas one. In one stunning stroke, amid a national conservative tide, California voters essentially ratified a political and regulatory regime that has left much of the state unemployed and many others looking for the exits. read more »
The results of the mid-term election of 2010 will be written over the next two years. Can the Republicans really make good on their promise of fiscal discipline? A glimpse of our future federal budget may be seen in the fiscal actions (and inaction) of America’s governors. Most states are struggling to balance budgets in troubled economic times with projected shortfalls nationwide of more than $100 billion for Fiscal Year 2012. Federal bail-outs are no longer an option. The hard choices are tax increases, reduction of services or innovative fiscal solutions like deconstruction. read more »