Econintersect: Every day our editors collect the most interesting things they find from around the internet and present a summary "reading list" which will include very brief summaries of why each item has gotten our attention. Suggestions from readers for "reading list" items are gratefully reviewed, although sometimes space limits the number included.
The Department of Interior announced on February 19 that it had approved two new solar projects on public lands along the border between California and Nevada. The two projects would have a combined capacity of 550 megawatts, enough to power 170,000 homes.
Hilarious Transcripts of Fed Minutes from 2008 Reveal Completely Clueless Fed (Mike Shedlock, MISH's Global Economic Trend Analysis) The Fed continued to worry about inflation as the financial crisis unfolded. Read also The New York Times account and also The Washington Post. It appears that Bernanke and Yellen were among the most aware of potential problems, but they underestimated the extent of the downturn until it was a full crisis in late 2008. But other Fed governors seemed unaware that this was a generational crisis even in December 2008. Clueless seems too kind a term for some of these clowns. Some of them thought that the Lehman collapse was the end of the crisis and the Fed should step out of the picture. More to come on this later at GEI News.
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The Recovery™ - Bubble Back To the Bar For the Hair of the Dog That Bit You (Jesse's Cafe Americain) The market change corresponding to the Fed balance sheet? On the S&P 500 it is 50 points per $100 billion. Correlation does not prove causation? True, but this is compelling circumstantial evidence - just one trace of DNA would get a life without parole conviction. But, wait a minute! The defense would get the accused off. The data indicates the fatality would have to occur before the shot was fired - in this case the stock market went up 4-6 months before the balance sheet increased.
Can the Internet democratise capitalism? (Yanis Varoufakis) Hat tips to Roger Erickson and Yves Smith, Naked Capitalism. Prof. Varoufakis sees the internet as the vehicle which will "undermine the currently dominant corporate model which relies on the segregation between non-labouring shareholders and labouring non-owners". He foresees the emergence of a "new type of participatory production model, will the political and the economic sphere become integrated again in a manner consistent with democratic principles."
The U.S. Economy Might Be Doomed—but the Stock Market Isn't (Jordan Weissman, The Atlantic) There is something wrong with the relationship between stock growth and GDP growth - there isn't any relationship. Two possibilities: (1) stocks are not growing in proportion to the contribution of the companies to the economy; or (2) GDP is not a good measure of economic growth. Maybe some of both?
Fracking Boom Spews Toxic Air Emissions on Texas Residents (Lisa Song, Jim Morris and David Hasemyer, Inside Climate News) Eight-month investigation reveals that the Texas State Legislature is more intent on protecting the industry than protecting residents' health. This is air pollution - and you thought the debate was all about water pollution.
The subprime education crisis (Frances Caoppola, Pieria) Frances Coppola has contributed to Global Economic Intersection. How long can you keep charging more and delivering less?
If New York Times Reporters Won’t Read Krugman about Austerity Will they Read Brooks? (William K.Black, New Economic Perspectives) William K. Black contributes to Global Economic Intersection. A good read about the 'right', the 'righter' and the 'rightest' (Econintersect terms, not Prof. Black) at The New York Times. In case you think we might have lost our marbles, Paul Krugman is not put in any of those three categories.
Death to Machines? (Robert Skidelsky, Project Syndicate) Robert Skidelsky has contributed to Global Economic Intersection. Skidelsky reduces the paradox of machine replacing man to the need to balance reducing real costs of goods produced through productivity gains and with the need for real income to derive consumption. While the Luddites of the early 19th century over-simplified their plight of lost labor to be the fault of machines, Skidelsky maintains they deserve some credit for the recognition that their problems were not to be resolved by "laissez-faire nostrums".
US inequality due to assortative marriages (Jeremy Greenwood, Nezih Guner, Georgi Kocharkov and Cezar Santos, Voxeu) The increased coordination of education levels in marriages has contributed to the increased income inequality. Kendall's tau, below, increases with increased correlation of two spouses' education levels.
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