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 (and sometimes longer ones) 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.
This feature is published every day late afternoon New York time. For early morning review of headlines see "The Early Bird" published every dayin the early am at GEI News (membership not required for access to "The Early Bird".).
Yellen Warns Congress Against More Fed Oversight(The New York Times) Federal Reserve chair Janet L. Yellen told lawmakers on Wednesday that proposals to increase congressional oversight of the central bank could cause collateral damage to the broader economy. She repeated versions of that warning several times in a three-hour hearing before the House Financial Services Committee, ceding no ground to Republicans who want to impose new limits on the Fed. Econintersect: The last thing we want is a Fed run by whatever party controls the Congress. Imagine a Congressional committee demanding that the Fed determine monetary policy by meeting with them "around the kitchen table" so that the country can be "run like a household".
The black president some worried about has arrived (The Washington Post) Obama might look or sound "brand new" to some Americans. He might even sound a little something like the black president some white Americans across the political spectrum feared (or hoped for). But to people who watch the White House closely, this is the President Obama who has been developing for some time. Read Fear of a Black President (The Atlantic)
GOP contenders embrace criminal justice reform (The Hill) Republican presidential candidates are turning their sights on criminal justice reform, indicating that the issue has broken into the mainstream conservative movement as the party seeks inroads with minority voters.
Germany Offers Verdict on Greek Aid After Draghi Backing (Bloomberg) German lawmakers have their say on Greece’s next bailout on Friday after European Central Bank President Mario Draghi said he views the country’s place in the euro as secure. As Europe seeks to line up a three-year aid package worth as much as 86 billion euros ($94 billion), the lower-house vote is a renewed test of Chancellor Angela Merkel’s struggle to persuade Germans that Greece is still worth helping.
Greeks numb after months of waiting out crisis with bated breath(Al Jazeera) Psychoanalysts say many are confused and exhausted by rapidity of debt negotiations and flip-flopping of politicians. With the country teetering on the edge of economic collapse and a continuous barrage of news developments, life for Greeks these past two weeks has been mind-numbing and dizzying. Things are happening so fast, people say they can’t think straight. Even the meaning of something as simple as “yes” and “no” is not all that clear any more.
Japan divided over legislation to expand military's role (Al Jazeera) A parliamentary committee on Wednesday approved legislation that would expand the role of Japan's military. Lawmakers and citizens are protesting the bill to reinterpret Japan's policy on self-defense; call it unconstitutional.
China's economy is all about one thing right now (Business Insider) Finance normally does not have a strong contribution to GDP (about 5-7% historically in the U.S.) which is focused on goods and services. But it is estimated that rapid growth of the financial sector in China may have contributed more than 0.5% to the 7% GDP growth rate just reported for the second quarter.
The Grid is at a Fork in the Road (Leia Guccione, Rocky Mountain Institute) Solar PV and batteries will be part of the grid of the future. But what part? And what sort of grid? The answers are as yet uncertain, but decisions made today will set the grid’s evolution on a trajectory from which it will be harder to course correct in the future. And that evolution and trajectory could differ from one state to another. See following articles.
The Economics of Load Defection (Rocky Mountain Institute) In areas of the U.S. where electricity costs are high (like the northeast) solar electricity is already much cheaper than what is delivered over the grid. This article explores the economics and technical issues of using solar as a source within the grid displacing fossil fuels. This report says that grid-connected solar-plus-battery systems are coming and could soon supply the majority of customers' electricity needs. By 2050 solar energy could supply as much electricity to the grid in the northeastern U.S. as the total consumption is today. What about roof-top solar off-grid? See next article.
Other Economics and Business Items of Note and Miscellanea
Understanding Diffusion Models of Growth (The Growth Economics Blog) A recent series of papers has shown the assumptions under which diffusion or imitation processes will lead to constant, sustained growth.
Anchoring in Economics: On Frey and Gallus on the Aggregation of Behavioural Anomalies (Economics) When individuals employ external inputs rather than relying upon their own judgemental capacities, the quality of decision-making may differ at the market and macro levels from what has been observed in laboratory experiments. This paper seeks to forestall potential moves by rational choice theorists to argue that such processes, imposed by competitive pressures, will swiftly eliminate anomalous behaviour.
About 6.6M Taxpayers Paid ACA Fines (Insurance News Net) About 6.6 million U.S. taxpayers paid a penalty imposed for the first time this year for not having health insurance, about 10% more than the Obama administration had estimated — though a portion didn't need to. The average penalty was $190, the Internal Revenue Service (IRS) said Wednesday in a report. About 300,000 taxpayers overpaid the penalty by a total of $35 million. Most should have been exempt for their low income, according to the agency. The average overpayment was a little more than $110. The IRS hasn't decided yet whether to issue a refund for the overpayments.
Boomers who have not retired yet “have unrealistic expectations about compensation and the work arrangements they will be able to find,” the study found. Only 21% of non-retired boomers said they would be willing to take a pay cut for their work in retirement and more than half of currently employed retirees reported making much less per hour in retirement.
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