Once a year, the U.S. Bureau of Economic Analysis (BEA) releases a new set of economic growth estimates that include not yet released numbers for the second quarter and revisions to historical GDP estimates as far five years back. Today is that day. The first estimate of 2015’s second quarter economic growth is 2.3 percent,… Read more

Here’s the first paragraph from a FED press release of July 20th: The Federal Reserve Board on Monday approved a final rule requiring the largest, most systemically important U.S. bank holding companies to further strengthen their capital positions. Under the rule, a firm that is identified as a global systemically important bank holding company, or… Read more

California’s water regulatory environment is a mess.  One result is that it’s expensive and often arbitrary.  It’s expensive to support, but that’s the not biggest cost.  The real loss is in the efficient use of water. Since allocation in California is increasingly a political process, there is no reason to believe it’s economically efficient.  Indeed,… Read more

I’ve argued for some time that services for the wealthy will be a major source of Coastal California jobs in coming years.  As people become more wealthy, they increase their specialization.  That is, wealthy people specialize in consumption and whatever it is that brings them their wealth.  That may mean specializing in consumption and in… Read more

A few years ago, I was convinced that Greece would have to leave the European Union within months.  So, I made some bets.  Of course, I lost those bets. At the time, I attributed my losses to underestimating Europeans’ fear of repeating the 20th Century’s violence and their conviction that only some sort of union… Read more

Several years ago I was asked to speak at a dinner meeting for some customers of a large insurance company.  It so happens that another economist, Gene Stanaland, was the featured speaker in the afternoon session.  Gene turned out to be a professional speaker who bills himself as the “Will Rogers of Economics.”  He was… Read more

In this article, Joshua Brown argues that the impacts of Greek default are likely to be small.  He correctly points out that Greece’s economy is really pretty small in the scheme of things. But does that really mean that the impact of a default is really small?  I think most of the time it would,… Read more

Here’s what the OECD has to say about the global economy: But the global economy can be characterised (sic) as only achieving a muddling-through “B-minus ” grade. Global growth in the first quarter of 2015 was weaker than in any quarter since the crisis. And although this softness is seen as transitory, productivity growth continues… Read more

I saw this Kaufman Foundation article that argues that, by reducing the downside risks, an aggressive government-provided safety net promoted entrepreneurship, jobs, and economic growth.  If one follows the links, there is some empirical support for the argument. So, I figured that if I looked at data across countries, high-support countries would dominate new-business data.  When… Read more

Since the dismal first-quarter GDP was revised down, we’ve heard all sorts of excuses.  These include bad winter weather and problems in the seasonal adjustment process.  The bad-winter excuse has been popular for several winters now.  Of course, as I’ve said before, strong economies absorb bad winters with minimal impact on output, GDP. Now, we hear… Read more

The California Center for Jobs and the Economy has released a report comparing Los Angeles County’s economy with the Bay Area’s growth.  Needless to say, Los Angeles doesn’t look good in the comparisons. Early on, they not that Los Angeles’ economy has been almost unique in not creating jobs: In their March 2014 report, UCLA… Read more

This analysis suggest that low oil prices will likely persist.  It seems that U.S. firms are more competitive than previously thought: But U.S. firms haven’t assumed that role as readily as the Saudis would have hoped. Rather, they’ve been hard at work innovating their way to profitability even at $65 per barrel. True, shale growth… Read more

The folks at Chapman University have produced an important new paper.  We’ve said for a long time that reducing California’s Carbon Emissions is both expensive and futile, if the goal is to reduce global atmospheric carbon.  Here’s what the report has to say: This paper demonstrates that even the complete elimination of state GHG emissions will have no… Read more

It’s generally agreed that excessively lax lending standards were major contributors to the financial crisis that precipitated the Great Recession.  So, Washington wants to do it again, only more.  Here’s part of what Investors.com has to say: In a just-released federal report, the administration portrays these “credit invisibles” as victims of a traditional credit-scoring system.… Read more

It is.  Corporate welfare sustains inefficient old firms while impeding innovative new firms.  In this Forbes piece, George Leef discusses the use of tax waivers or direct subsidies to attract firms to a city or state.  As he points out politicians of all stripes do this: One of the great bipartisan follies of American politics is the idea… Read more