What kind of fiscal stimulus would have the most impact on the economy? Moody’s Economy.com has made estimates for various different stimulus proposals of the one-year change in GDP for each dollar in government spending or tax cuts. Here are some examples:
Non-refundable lump-sum tax rebate: $1.01
Refundable lump-sum tax rebate:
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The Chinese government’s big announcement that it would spend $586 billion stimulating its domestic economy by building highways, railroads and airports excited global markets for about half a day Monday. Then everybody remembered that, as the WSJ reports:
Already, according to official estimates, infrastructure spending had been
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It’s already been noted that Warren Buffett seemed to get a much better deal on his Goldman Sachs capital injection than the Treasury Department did. It turns out the United Steelworkers union has been kind enough to actually run the numbers on the two deals, using the Black-Scholes option pricing model to value them (steel workers are …
Here’s a little something I wrote last January on the way home from the World Economic Forum in Davos:
After hearing various gloomy pronouncements from members of TIME’s Board of Economists, audience member C. Fred Bergsten of the Peterson Institute for International Economics grabbed a mike, stood up and declared that growth in emerging
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Sorry for being way behind on the big news of the day. Stuff’s been happening here in the Time & Life Building.
Anyway, the government has decided to renegotiate and ease the terms of its deal with AIG. Reports the WSJ:
Under the terms ironed out late Sunday, the government would give AIG more money, including $40 billion from the U.S.
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I’ve been among those arguing that GM ought to shut up about a government bailout and use the well-established bailout/reinvention tool that is Chapter 11 bankruptcy to pave the way for a better future. Now here, courtesy of the WSJ’s John Stoll, are GM’s three arguments for why that’s not an option–followed by my analysis in …
Deborah Solomon and Michael Phillips have a great article in Saturday’s WSJ about the Tim Geithner vs. Larry Summers Treasury Secretary bakeoff. They say Obama’s advisers are split between the two. And they offer lots of color about the long and friendly relationship between the rivals. They met when Summers arrived at Treasury in 1993 …
The deficit for the 2008 fiscal year, which ended Sept. 30 was $455 billion, the Congressional Budget Office reported Friday. And the estimated deficit for the month of October? $232 billion!
That’s if you count the Treasury’s bank capital injections on a cash basis. Use the CBO’s present-value calculation and October’s deficit drops to …
That was one thing the president-elect made crystal clear in his press conference today, declaring at least twice that the U.S. only has one president at a time and it won’t be him until January 20. As for his economic plans, the focus of the event, he didn’t say anything major that he hadn’t said already. The one possible bit of news …
Neel Kashkari, the man who runs the American banking system (a.k.a. the Interim Assistant Secretary of the Treasury for Financial Stability), came to New York today to speak to a bunch of business school students at the annual Wharton Finance Conference. The most interesting information that I got out of sitting in on his speech was that …
A whopping 0.38% of American nonfarm jobs disappeared in September and October, the Labor Department announced today.
What? That doesn’t sound whopping? It’s 524,000 jobs, which amounts to a lot of people’s livelihoods lost and financial security dashed. But it’s still just a tiny share of those employed in this country, estimated at …
It’s just been announced that David Booth, co-founder of Dimensional Fund Advisors, is giving $300 million to the University of Chicago Graduate School of Business, which will be renamed the University of Chicago Booth School of Business. Given that pretty much all of DFA’s product line has grown out of research done at the Chicago …
