Excess demand for money, manufacturing news, grid parity, and Austrian BC theory

Nick Rowe on the importance of excess demand for money. This directly relates to what the Fed has been doing for quite some time to help the current crisis. Nick has had a lot of really good posts lately, it seems to me.

Mark Perry had optimistic news on the manufacturing front. It seems like these numbers will return to normal pretty soon, which makes me think that more focus will turn towards worsening labor numbers. Though, we're only six months or so away from the peak. Six months seems like a relatively short amount of time considering how long this had dragged out already.

John Quiggin reports that some solar power companies may be approaching grid parity, or the point where solar power is as cheap as conventional power.

Another good post from John Quiggin, he talks a little about the history of the Austrian Business Cycle, and why it isn't really taken seriously anymore by more empirical-minded economists.

Development, crowding out, NewDeal2.0, economic terminology, and China,

Here's a nice story about a UCLA grad student making a difference in the world.

The Skeptical Optimist points out that the "crowding out" theory is bunk.

Here's an interesting website providing commentary from political scientists, economists, historians, and more. NewDeal2.0.

Uwe Reinhardt tells writes an article mostly directed at economists, I think. Some our terminology shouldn't is misleading when used in public discourse. We should be careful in using it, and others should take it with a grain of salt.

Is the Chinese economic model more effecting than the US economic model? Uh, no. Despite China's growth, models show pretty clearly that underdeveloped economies will tend to have higher growth rates than developed economies. This isn't a function of types of economic systems.

Fuel efficiency, forecasts, gendered lob losses, April economic summary, and GDP growth rates

Fuel efficiency raises demand, not lower it. Efficiency lowers cost, which raises demand in the long run. I keep thinking that the short run effect should be modeled as a rise in supply, but the narrative doesn't quite fit.

Simeon Djankov says not to pay attention to the forecasts. They lag behind the news, and are thusly not worth much.

Job losses for different genders. Men have lost many more jobs than women, net. Women seem to have more recessioon-proof jobs.

April economic summary in graphs. It seems to me that most of them tell a similar story.

GDP growth rates for beginners. This is really a well-written and easy to understand post, I think.

Sumner, World Bank, global recession, GDP, the auto industry, and education.

Scott Sumner with an excellent post covering macroeconomics, democrats being called socialists, soaps promoting liberal values, and Tyler Cowen. As is normal on Sumner's blog, the post is quite long, but he makes a lot of great points. Of course, I don't agree with him on the causes of the current recession, I take a more moderate view, I think.

Geo, a map of World Bank development projects. There are some very good, interesting maps there, if you're interested in international aid.

The St. Louis Fed releases some data on how the US is faring compared to other countries.

Even though Wednesday's GDP report was pretty bad, there are some silver linings. For example, the part of GDP that did the worst was the lagging indicators--the leading indicators weren't quite so bad. So, a turnaround may be in sight.

An interesting discussion: does America need the auto industry? Some pretty smart people take a stab at the question. Another NYT "debate" on education reform.

Agriculture, Libertarianism, TED talk, law, city house prices, and Google

Some stylized facts about agricultural subsidies. It looks like a very inefficient market. Again, no surprise there.

Henry Kaufman explains how Libertarianism hindered the Fed. While I don't agree with all of it, it raises some good points, I think.

A couple of very interesting pieces from Marginal Revolution. I recommend you read them. Alex Tabarrok gave a TED talk, and Tyler Cowen discusses the field of Law and Economics.

Here's some Case-Shiller city data on housing prices. They're still dropping, though it looks like we're nearing normal levels in some places. Unfortunately, there's still likely more dropping to happen, due to a super saturated market.

On a different sort of note, now Google offers some searchable public data. I hope they greatly expand this.

Stress tests, immigration, trade balances, R&D

A basic explanation of the bank stress tests. Apparently, most of the banks are doing well.

Would legalizing immigrants improve the economy? I don't think this is a tough question for most economists, though they'd probably disagree on the degree to which it would help.

Some interest graphs on US trade. The trade balance is improving very quickly, helping the dollar, and lowering import prices. Menzie Chinn with a more advanced econometric analysis. I guess we'll see how this plays out in GDP forecasts.

On news of Obama announcing he wants to raise R&D spending, here's a graph showing R&D spending as a percentage of GDP, for the US and some other places. I'd be curious to see a longer term graph. It looks like the US spends very little on R&D, as a percentage of GDP, compared to other countries. I've seen research saying that government R&D isn't very effective, but if economic growth is tied to technological growth (which few economists diagree), then increasing R&D spending sounds like a good idea, in general.

Chile, debates, housing, oil and recessions, and cognitive skills

Rodrik talks about the Chilean Minister of Finance. He saved during the boom, although it was unpopular, and is now spending the massive savings. Why don't more countries do this?

Alex Tabarrok talks about the debates at Intelligence Squared. I like the concept of the website, though. Get experts to debate issues and provide podcasts. People vote on winners.

Jon Lansner talks about housing, via CR. Prices should bottom out late next year.

James Hamilton points out the connection between oil price spikes and recessions. That's really interesting research.

Some research shows that people with higher cognitive skills perform better economically. Moreover, to the extent that this is a genetic trait, evolution may play a factor in separating people with of cognitive skill levels.