A couple weeks ago the Federal Reserve announced results of the latest Comprehensive Capital Analysis and Review (CCAR), aka stress test, for large banks.  The stress scenario included 13% unemployment, a 50% drop in stock prices and a further 20% drop in housing prices.  Basically, the scenario is a severe double dip recession.  In order… Read more

Dan Walters has a piece on California’s proposed licensing of interior designers, and I recommend you read it.  Here’s his concluding paragraphs: Is there any public interest need for such licensing? If an interior designer botches a job – painting a wall magenta instead of puce or some such – it’s not a matter of life… Read more

Last week the Federal Reserve released the Flow of Funds (FOF) report for the quarter ended December 31, 2012.  The report showed that household sector net worth increased by $1.2 trillion during the quarter to $58.5 trillion.  The financial crisis and subsequent recession has been marked by an enormous decline in household net worth, due… Read more

One of the more revered rules of thumb in retirement planning is that retirees can be comfortable in spending 4% per year of their accumulated net worth.  While the origin of this rule is not certain, it has been popularized by financial planning expert William Bengen in a series of articles dating back to the… Read more

Brian Caplan was writing about the Charter Cities, which he likes as a second-best choice because: The first-best solution to global poverty, therefore, is for the First World to allow much higher levels of immigration.  Unfortunately, despite its low absolute level (annual U.S. immigration is well under 1% of its population), immigration is already extremely unpopular.  For… Read more

Veronique de Rugy is a provocative woman, and a smart one.  Here’s what she said in a piece on women: Improving the lot of American women means lowering marginal tax rates, abolishing many workplace regulations, increasing the number of low-skilled immigrants, and ending the drug war. That’s what we call counter intuitive, but she makes… Read more

The headline is “AP: Wells Fargo customers soon will pay $7 checking account fee.”  It’s accompanied by a picture of Wells Fargo’s CEO, a picture that makes him look like he eats babies for breakfast.  The first paragraph reads: Customers in California and six other Western states soon will pay a $7 checking account fee,… Read more

I recently had a piece on immigration a San Diego’s Union Tribune.  It is about how an increase in legal immigration could be an economic spark, and I thought I was the only one thinking about the topic. Turns out I was wrong. There’s an outfit called the Partnership for a New American Economy, and… Read more

Economists assume that people attempt to smooth consumption over time.  The data are consistent with this assumption.  If you follow a cohort of people over a number of years, you will observe that their income will fluctuate a lot more than does their consumption.  Income generally rises sharply early in peoples’ careers, peaks out in… Read more

Veronique De Rugy at George Mason University’s Mercatus Center has a nice piece Debt Grows at a Faster Rate Than Economy for Foreseeable Future. My working definition of sustainability: when something is growing slower than the economy, it is sustainable.  Usually, we’re talking about prices, but debt works too. Something will have to change.