Imagine that you decide to go out for dinner and do so by paying a visit to a local café you have frequented for years. You have your mouth all set for dining on some delicacy you have ordered many times in the past, and all seems right with the world. You are shown to your seat and without even looking at the menu, you tell your waiter the culinary choice that you have been anticipating throughout the day. As you do so, your waiter tells you the government has ordered them to stop selling that precise item they offered in the past, but there is a government-approved substitute that is available, and government feels the alternative is better for you health-wise.
Sep 4 2012 | Posted in
Jim Newton |
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Every year in late summer an annual event takes place in Jackson Hole, Wyo., when the crème de la crème of the economics profession come together and discuss the state of the economy. Oddly enough, my invitation has once again been lost in the mail. But — perhaps this is simply a rationalization — I find I don’t care because this gathering reminds me of the scene in the “Wizard of Oz” when the wizard, just before the takeoff of his hot air balloon, indicates that he is going to set sail and hob-nob with his fellow wizards. That’s what this symposium represents to me; a bunch of economic wizards hob-nobbing about something that is broken.
From time to time, you may hear of something called the law of unintended consequences as it relates to economic decision-making. To the best of my knowledge, there is no such law in the dismal science. Rather, the “law” is simply based upon a concept called “opportunity costs,” which represents a fundamental issue in economic analysis.
Aug 21 2012 | Posted in
Jim Newton |
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One of the central themes of the current presidential campaign season deals with taxes, specifically, federal income taxes.
Last Friday saw the release of the latest jobs data and markets seemed to be in love with the results, given a stock market rally of better than 200 points for the Dow Jones Industrial Average. What were the specific results that prompted this sense of elation? The Labor Department reported that employment levels rose. They also reported that employment levels fell. Oh, and then there was the rise in the unemployment rate from 8.2 percent in June to 8.3 percent in July.
Aug 7 2012 | Posted in
Jim Newton |
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Jobs, jobs, jobs … everyone seems to agree the presidential election is all about jobs and how to provide more of them throughout the country. Here in Ohio — and even more so in central Ohio — jobs are being created at a more rapid pace than is true for the overall nation, but by any definition, virtually all areas (including Ohio and Columbus) are far from full employment.
As this column is being written on Monday afternoon the Dow Jones Industrial Average is down by more than 100 points for the day, with two other market averages, the NASDAQ composite and the S&P 500 both showing decreases as well. Not to be outdone, bond markets are also getting in on the depressing action, with the yield on a 10-year Treasury note reaching a historic low of just over 1.40 percent. For the various stock indices, the figures cited above still leave them in positive territory for the year, but the gains could quickly evaporate by year’s end.
Jul 24 2012 | Posted in
Jim Newton |
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Over the past week, VISA and MasterCard took their second big hit over the past decade in terms of how they interact with the nation’s retailers when consumers use credit or debit cards when buying merchandise. In both cases, a number of the country’s major retailers accused the two credit card companies of engaging in anti-competitive practices that were robbing them (retailers) of legitimate profits.
