CARPE DIEM Professor Mark J. Perry's Blog for Economics and Finance SUNDAY, MAY 31, 2009 Bull Market Rally in World Stocks; Largest 3 Month Gain in History of MSCI World Stock Market Index The MSCI World Stock Market Index increased by 8.62% in May, following gains of 10.91% and 7.24% in April and March (see chart above). Over the last three months, the cumulative compounded gain of 29% in the World Stock Market Index is the largest gain over a 3-month period in the history of the index back to 1970 (full dataset here). Posted 10:22 PM Post Link 3 Comments Detroit vs. Pittsburgh: Hockey and Economics NY TIMES (Jan. 7, 2009) -- This is what life in one American city looks like after an industrial collapse: Unemployment is far below the national average (see chart above, data through April 2009). While housing prices sank nearly everywhere in the last year, they rose here. Wages are also up. Foreclosures are comparatively uncommon. A generation ago, the steel industry that built Pittsburgh and still dominated its economy entered its death throes. In the early 1980s, the city was being talked about the way Detroit is now. Its very survival was in question. Deindustrialization in Pittsburgh was a protracted and painful experience. Yet it set the stage for an economy that is the envy of many recession-plagued communities, particularly those where the automobile industry is struggling for its life. “If people are looking for hope, it’s here,” said Sabina Deitrick, an urban studies expert at the University of Pittsburgh. “You can have a decent economy over a long period of restructuring.” Yet the semisweet spot that Pittsburgh finds itself in was never inevitable. As recently as 2000, it had a higher unemployment rate than Detroit or Cleveland (see chart above). Just as Michigan has traditionally put all its chips on the auto industry, it took Pittsburgh a long time to come to terms with the end of the steel era. MP: As Detroit faces Pittsburgh for the Stanley Cup, it reminded me of a previous CD post and NY Times article contrasting the two cities in terms of economic development. There has been a lot of hysteria about the significantly negative impact of a GM bankruptcy on the Michigan and national economies, almost as if Detroit and Michigan could never fully recover from their long dependence on the auto industry. Pittsburgh's comeback from the decline of the domestic steel industry shows that Detroit and Michigan could survive even the unlikely demise of GM, and illustrates that there could be non-automotive life and jobs in Detroit and Michigan even without GM and Chrysler. As the chart above shows, Pittsburgh had a jobless rate above Detroit's as recently as 2000, and now has an unemployment rate of 6.9% (seasonally adjusted), almost 6.5 percentage points below Detroit's 13.3%, and more than 1.5% below the national average of 8.5% in April. Posted 9:35 AM Post Link 32 Comments SATURDAY, MAY 30, 2009 CA Real Estate Market Recovery: Sales Boom, Marketing Time Falls, and Unsold Inventory Drops LOS ANGELES (May 28) – Home sales increased 49.2% in April in California compared with the same period a year ago, while the median price of an existing home declined 36.5%, the CALIFORNIA ASSOCIATION OF REALTORS (C.A.R.) reported today.“With annualized sales at 540,360 units, April marked the eighth consecutive month of home sales above the 500,000 level,” said C.A.R. President James Liptak. Closed escrow sales of existing, single-family detached homes in California totaled 540,360 in April at a seasonally adjusted annualized rate, according to information collected by C.A.R. from more than 90 local REALTOR associations statewide. Statewide home resale activity increased 49.2% from the revised 362,170 sales pace recorded in April 2008 (see chart above). Sales in April 2009 increased 3.2% compared with the previous month. The median price of an existing, single-family detached home in California during April 2009 was $256,700, a 36.5% decrease from the revised $404,470 median for April 2008, C.A.R. reported. The April 2009 median price rose 1.4% compared with March’s $253,040 median price. C.A.R.’s Unsold Inventory Index for existing, single-family detached homes in April 2009 was 4.6 months, compared with 9.8 months (revised) for the same period a year ago (see chart below). The index indicates the number of months needed to deplete the supply of homes on the market at the current sales rate. The median number of days it took to sell a single-family home was 48.7 days in April 2009, compared with 51.8 days for the same period a year ago. MP: In March, the California median home price showed the first monthly increase since August 2007, and has now increased for two months in a row with the monthly increase in April. Falling prices compared to last year are stimulating unit sales, homes are selling faster than last year, unsold inventory of homes is decreasing as the market clears excess supply. Markets are working for California real estate. Posted 9:01 PM Post Link 11 Comments Florida Home Sales Increase for 8th Straight Month ORLANDO, Fla. – May 27, 2009 – Florida’s existing home sales rose in April – the eighth consecutive month that sales activity increased in the year-to-year comparison, according to the latest housing data released by the Florida Association of Realtors (FAR). April’s statewide sales showed gains over the previous month’s sales level in both the existing home and existing condominium markets. Existing home sales rose 18% last month with a total of 13,111 homes sold statewide compared to 11,133 homes sold in April 2008, according to FAR. April’s statewide existing home sales were slightly higher than statewide activity in March. Florida’s median sales price for existing homes last month was $138,500; a year ago, it was $199,500 for a 31% decrease (see chart above). Posted 9:47 AM Post Link 7 Comments FRIDAY, MAY 29, 2009 Restaurant Activity Index Increases For 4th Straight Month; Reaches Highest Level Since May 2008 (Washington, D.C.) -- The outlook for the restaurant industry grew more optimistic in April, as the National Restaurant Association’s comprehensive index of restaurant activity registered its fourth consecutive monthly gain. The Association’s Restaurant Performance Index (RPI) – a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry – stood at 98.6 in April, up 0.8% from March, its highest level in 11 months (see top chart above). “The recent growth in the RPI was driven by the Expectations component, which rose above 100 in April for the first time in 18 months, a level which indicates expansion,” said Hudson Riehle, senior vice president of Research and Information Services for the Association (see chart above). “Although the RPI’s Current Situation indicators are still in a period of contraction, the solid improvement in the forward-looking indicators suggests that the end of the industry’s downturn may be in sight.” Full report here. Posted 3:49 PM Post Link 4 Comments THURSDAY, MAY 28, 2009 Cartoon of the Day HT: Mitch Parr Posted 11:38 PM Post Link 1 Comments The New C Word A cartel is an organization of producers that agree to coordinate prices and production. The Organization of the Petroleum Exporting Countries (OPEC) is a cartel of twelve countries made up of Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates, and Venezuela. The cartel has maintained its headquarters in Vienna since 1965, and hosts regular meetings among the oil ministers of its Member Countries. REUTERS -- An OPEC statement formally confirming the decision said the organization "reiterated their firm commitment" to their quotas — organization members under quotes are still producing more than 800,000 barrels a day above the group's overall target level of just under 25 million barrels. MP: So let me get this straight. OPEC is not a cartel (watch the video above), but the members have just met to engage in collusion to restrict output, and they are all now firmly committed to the production quotas they agreed to maintain?! Posted 4:17 PM Post Link 11 Comments Unionized Companies Punished in Bond Market NEW YORK (Reuters) - Scores of companies are being punished in the bond market as the Obama administration's policies on General Motors and Chrysler LLC create new risks for creditors, a veteran bond strategist says. As GM teeters toward a bankruptcy filing and Chrysler attempts to restructure in bankruptcy court, the Obama administration is offering most of the recovery value of those companies to "a favored political class, in this case the United Auto Workers, leaving creditors with very slender debt recoveries," Christopher Garman, founder of Garman Research in Orinda, California, said in a report released late on Friday. To gauge whether those cases have made debtholders wary of other companies with so-called favored political classes, Garman compared spreads, or bonds' extra yields over U.S. Treasury yields, for companies with collective bargaining agreements with the high-yield bond market as a whole. While the two performed in line with each other since 2003, they diverged sharply in February, with spreads on companies with organized labor gapping nearly 11 percentage points higher than the market as a whole, according to Garman's research. The gap in spreads has persisted and was about 9 percentage points as of mid-May, Garman said. The gap appeared shortly after strategists reported signs that bondholder negotiations with GM were unraveling. Apart from automakers, sectors heavily influenced by collective bargaining agreements include supermarkets, construction, wired telecommunications, delivery and healthcare, Garman found. Gaming, select media and publishing companies and paper and textile companies also made his list. For years in the past, "bondholders were more than happy to hold on to the debt of these companies," Garman said in an interview. "That's come to a pretty sharp end over the past six months." Garman's findings echo warnings from other bondholders that unionized companies will have trouble attracting cash in the bond market if the bankruptcies of GM and Chrysler give creditors substantially smaller payouts than they traditionally received. HT: Mike LaFaive Posted 8:32 AM Post Link 10 Comments WEDNESDAY, MAY 27, 2009 Baltic Dry Index Advances 20 Days in a Row The Baltic Dry Index came close to reaching an 8-month high today, closing above 3,000 for the first time since early October, and hitting the highest level since September 30. The shipping index has advanced for each of the last 20 sessions, and the 222 point increase today was the largest one-day increase since early July 2008. Update: FT.COM --Rising demand for raw materials in China has led to a sharp recovery in the Baltic Dry Index, the benchmark for freight costs for dry bulk commodities such as iron ore, coal and grains. The Baltic Dry jumped 7.6 per cent to 3,164 points on Wednesday, pushing through the 3,000-points mark for the first time since October as shipping congestion outside China’s ports reached record levels with 80 Capesized vessels awaiting unloading. Posted 10:46 PM Post Link 11 Comments Remember The Good Old Days? Link. Posted 8:44 PM Post Link 4 Comments Controversy at Univ. of Chicago: "Men in Power" April Unemployment Rates Male: 10% Female: 7.6% Note: The 2.4% male-female jobless rate gap in April is at an all-time historical high. Job Losses During the Recession: Male: 79% of total Female: 21% of total Bachelor's Degrees Female: 57.4% Male: 42.6% Master's Degrees Female: 60% Male: 40% Note: Women earn 135 bachelor's degrees for every 100 degrees earned by men, and by 2016 that ratio is projected to be 150:100. Women earn 150 master's degrees for every 100 degrees for men, and that ratio is expected to be 170:100 within seven years. University of Chicago Approved Women's Groups on campus: 11 Approved Men's Groups on campus: 0 (1 pending) CHICAGO TRIBUNE -- A group of University of Chicago students think it's time the campus focused more on its men. A third-year student from Lake Bluff has formed Men in Power, a student organization that promises to help men get ahead professionally. But the group's emergence has been controversial, with some critics charging that its premise is misogynistic. Others say it's about time men are championed, noting that recent job losses hit men harder and that women earn far more bachelor's and master's degrees than do men (see data above). Posted 3:41 PM Post Link 24 Comments Empire State Survey Suggests Recession is Ending NY Fed Empire State Manufacturing Survey -- The future general business conditions index rose 11 points in May to 43.8, its highest level since November 2007 (see chart above). This index has shown a cumulative increase of more than 40 points over the past two months. The future new orders and shipments indexes have followed a similar path. The future prices paid index remained modestly above zero, while the future prices received index remained just below zero. The future employment indexes were both positive. The future index for number of employees rose for a third month, to 0.7, and the future average workweek index dipped to 4.6. The capital expenditures and technology spending indexes were little changed from last month, both holding just below zero. MP: The last time there was a two-month increase of more than 40 points was November 2001, at the tail end of the 2001 recession. Posted 8:23 AM Post Link 16 Comments TUESDAY, MAY 26, 2009 Exhibit B: Tax The Rich, Lose The Rich Maryland couldn't balance its budget last year, so the state tried to close the shortfall by fleecing the wealthy. Politicians in Annapolis created a millionaire tax bracket, raising the top marginal income-tax rate to 6.25%. And because cities such as Baltimore and Bethesda also impose income taxes, the state-local tax rate can go as high as 9.45%. Governor Martin O'Malley, a dedicated class warrior, declared that these richest 0.3% of filers were "willing and able to pay their fair share." The Baltimore Sun predicted the rich would "grin and bear it." One year later, nobody's grinning. One-third of the millionaires have disappeared from Maryland tax rolls. In 2008 roughly 3,000 million-dollar income tax returns were filed by the end of April. This year there were 2,000, which the state comptroller's office concedes is a "substantial decline." On those missing returns, the government collects 6.25% of nothing. Instead of the state coffers gaining the extra $106 million the politicians predicted, millionaires paid $100 million less in taxes than they did last year -- even at higher rates. ~Wall Street Journal (HT: Lee Coppock) See Exhibit A here. Read about The Laffer Curve here. Posted 6:23 PM Post Link 19 Comments Evolution of Cell Phones: 1983-2009 Above is the 1983 model, see the rest here. Posted 9:55 AM Post Link 11 Comments MONDAY, MAY 25, 2009 WIRED: New Digital Socialism and Dot-Communism I recognize that the word socialism is bound to make many readers twitch. It carries tremendous cultural baggage. I use socialism because technically it is the best word to indicate a range of technologies that rely for their power on social interactions. Broadly, collective action is what Web sites and Net-connected apps generate when they harness input from the global audience. Of course, there's rhetorical danger in lumping so many types of organization under such an inflammatory heading. But there are no unsoiled terms available, so we might as well redeem this one. When masses of people who own the means of production work toward a common goal and share their products in common, when they contribute labor without wages and enjoy the fruits free of charge, it's not unreasonable to call that socialism. In the late '90s, activist, provocateur, and aging hippy John Barlow began calling this drift, somewhat tongue in cheek, "dot-communism." He defined it as a "workforce composed entirely of free agents," a decentralized gift or barter economy where there is no property and where technological architecture defines the political space. He was right on the virtual money. But there is one way in which socialism is the wrong word for what is happening: It is not an ideology. It demands no rigid creed. Rather, it is a spectrum of attitudes, techniques, and tools that promote collaboration, sharing, aggregation, coordination, ad hocracy, and a host of other newly enabled types of social cooperation. It is a design frontier and a particularly fertile space for innovation. Over the past century, every day, someone asked: What can't markets do? We took a long list of problems that seemed to require rational planning or paternal government and instead applied marketplace logic. In most cases, the market solution worked significantly better. Much of the prosperity in recent decades was gained by unleashing market forces on social problems. Now we're trying the same trick with collaborative social technology, applying digital socialism to a growing list of wishes—and occasionally to problems that the free market couldn't solve—to see if it works. So far, the results have been startling. At nearly every turn, the power of sharing, cooperation, collaboration, openness, free pricing, and transparency has proven to be more practical than we capitalists thought possible. Each time we try it, we find that the power of the new socialism is bigger than we imagined. We underestimate the power of our tools to reshape our minds. Did we really believe we could collaboratively build and inhabit virtual worlds all day, every day, and not have it affect our perspective? The force of online socialism is growing. Its dynamic is spreading beyond electrons—perhaps into elections. ~From "The New Socialism: Global Collectivist Society Is Coming Online" in the current issue of Wired Magazine, by Kevin Kelly Posted 4:36 PM Post Link 21 Comments NoVA Home Sales Increase for 13th Straight Month The Northern Virginia Association of Realtors reports that: The number of Greater Northern Virginia region homes sold in April was 2,904, a 5.75% increase from April 2008’s total of 2,746 sales. This marks the thirteenth consecutive month of increased year-over-year sales totals for Greater Northern Virginia. The average sales price of $331,600 in April 2009 continues to lag behind the 2008 average by 18.6%. The April 2008 average sales price was $407,500 (see chart above). Across Greater Northern Virginia, the number of listings showed a decrease from 2008 numbers, with 15,683 listings active, which is 33.2% less than this time last year, when 23,471 homes were available. The average number of days on the market (DOM) for a home sold in April 2009 was 89 compared with last year’s 112 DOM, a decrease of 20.5%. MP: Although the average sales price in April ($331,600) was down from a year ago by 18.6%, it was up from the average price in March ($317,158) by 4.55%, which was above February's average price of $305,000. The $303,000 average price in January 2009 appears to mark the bottom of the market for Northern Virginia, followed by 3 months of increasing average prices. Now with both unit sales increasing (13 consecutive months) and average home prices increasing (three consecutive months), along with reduced marketing time by 23 days, we can probably conclude that the real estate market in Northern Virginia reached a bottom in January 2009 and is now coming back. For some perspective, consider that in April of 2006, the average sales price was $507,585, or 53% above the April 2009 average price. Posted 7:34 AM Post Link 8 Comments Green Shoots Are Starting to Break Through But in Michigan??? Read about it here. Posted 7:10 AM Post Link 4 Comments Markets in Everything: Tata's $8,000 Condos BUSINESS WEEK -- Tata, the Indian company that made worldwide headlines with its $2,000 Nano car, now plans to build 1,000 tiny apartments outside Mumbai that will sell for $7,800 to $13,400 each. The company plans to roll out low-cost projects outside other major cities. Tata’s housing division is targeting a segment of the market that was largely overlooked during the housing boom. India’s builders were concentrating on building shiny new high rises and mansions on golf courses. Builders were after profits, but they were also trying to justify their fast-accelerating land costs, especially in and around Mumbai (formerly known as Bombay) and other major cities. But some business consultants (most prominently, C.K. Prahalad) were arguing that companies would profit handsomely if they target the “bottom of the pyramid” where the bulk of consumers are. It looks like Tata is taking that advice. HT: Freakonomics Posted 6:41 AM Post Link 13 Comments SUNDAY, MAY 24, 2009 Cartoons of the Day: CAFE Standards Michael Ramirez Henry Payne Posted 8:59 AM Post Link 2 Comments Will The Economic Crisis Change What Material Is Covered in a Freshman Economics Course? Not really, Greg Mankiw explains. Posted 7:43 AM Post Link 4 Comments ECRI: Green Shoots Will Blossom This Summer NEW YORK (Reuters) - A measure of U.S. futuree conomic growth inched higher in the latest week, while its yearly growth rate continued to climb toward positive territory. The Economic Cycle Research Institute, a New York-based independent forecasting group, said its Weekly Leading Index (WLI) edged up to a 29-week high of 111.1 for the week ending May 15 from 111.0 the prior week. The index's annualized growth rate reached a 35-week high of minus 11.5 percent from last week's rate of minus 13.6 percent. It was the highest yearly growth reading since the week ended September 12, when it stood at minus 11.4 percent (see chart above, click to enlarge). "With WLI growth rising steadily to a 35-week high, it is increasingly obvious that the 'green shoots' will blossom this summer," said Lakshman Achuthan, managing director at ECRI. Graph HT: Steven Hansen Posted 7:01 AM Post Link 3 Comments SATURDAY, MAY 23, 2009 Real Estate Market is Booming in Phoenix: What A National Housing Recovery Could Look Like LA TIMES -- More Phoenix homes are selling than at any time since 2006. Prices are slowly stabilizing. Buyers find themselves in bidding wars over low-end properties. It's what a national housing recovery could look like. Mike Orr, a Phoenix real estate analyst, thinks the market already has hit bottom. Among the signs: As recently as January, a year's worth of homes sat on the market; in March, that dropped to seven months' worth of inventory."It's a dramatic change in just three months," he said. "I never imagined it'd get this crazy this quickly." In a throwback to the boom, real estate agents and investors are swapping stories of brutal competition for bottom-end homes. Orr called on one property to find it had already received 14 bids. Realtor David Thomas recalled getting a client in a $60,000 foreclosed home in the suburb of Avondale, on a street lined with vacant properties. He recently returned to find almost all the for-sale signs gone. NY TIMES -- The low end of the Phoenix real estate market — and in some equally hard-hit places like inland California and coastal Florida — is becoming as wild as anything during the boom. One real estate agent was showing a foreclosed house to a prospective client when a passer-by saw the open door, came in and snapped up the property. Another agent says she was having the lock changed on a bank-owned home when a man happened by, found out from the locksmith that it was available, and immediately bought it. Bidding wars are routine. HT: Calculated Risk Posted 10:16 PM Post Link 10 Comments Who Could Possibly Object to Expansion of Low-Cost, Convenient Retail Health Clinics in Texas? Texas has only about 85 of the 1,200 retail health clinics in the nation. San Antonio does not have a single one. The clinics are popular wherever they exist because nurse practitioners can treat common ailments and minor injuries with little waiting time and fees that average about $60, much less than emergency rooms. The clinics operate evenings and weekends and accept insurance plans. The clinics would represent real health care reform, especially in Texas. Most of the state, 179 counties out of 254, is classified as medically underserved. Among them are 45 metropolitan counties. MP: Who do you suppose could possibly object to, and successfully block, the expansion of affordable, convenient retail health clinics in Texas, including in the medically underserved areas? Find out here, I am sure you can probably guess. Posted 9:57 PM Post Link 6 Comments Buying Brand New $23,000 Cars For Commuters in Phoenix is Cheaper Than Light Rail for $1.4B The other day, Phoenix trumpeted that its daily light rail ridership had reached 37,000 boardings per weekday. Since most of those people have two boardings per day (one each direction) we can think of this as 18,500 people making a round trip each day. Well, if we bought each of these folks a brand new Prius III for $23,000 it would cost us just over $425 million. This is WAY less than the $1.4 billion we pay to move them by rail instead. We could have bought every regular rider a Prius and still have a billion dollars left over! And, having a Prius, they would be able to commute and get good gas mileage anywhere they wanted to go in Phoenix, rather than just a maximum of 20 miles on just one line. ~Coyote Blog Posted 6:57 AM Post Link 36 Comments FRIDAY, MAY 22, 2009 Unintended Consequences: CAFE Standards Will Cause More Pollution and Increase Highway Deaths An economic phenomenon called "price elasticity of demand" is well established when it comes to automobile purchases. In other words, if you raise the price of new cars, people will buy fewer of them or, at a minimum, put off the purchase for a year or so while they drive the old clunker for a few thousand more miles. And fewer new cars means more pollution, which can cause significant health problems. Yet environmentalists and the press have ignored this issue, so as not to inject a note of complexity or doubt into the chorus of glee that greeted the president's attack on greenhouse-gas emissions. The Obama fuel efficiency plan may also contribute to a significant increase in highway deaths as vehicles are required to quickly meet the new CAFE standard and will likely become lighter in weight as a result. According to a study completed in 2001 by the National Research Council (NRC), the last major increase in CAFE standards, mandated by the Energy Policy and Conservation Act of 1975, required about a 50% increase in fuel economy (to 27.5 mpg by model year 1985 from an average of 18 mpg in 1978). The NRC study concluded that the subsequent downsizing and down-weighting of vehicles, "while resulting in significant fuel savings, also resulted in a safety penalty." Specifically, the NRC estimated that in 1993 there were between 1,300 and 2,600 motor vehicle crash deaths that would not have occurred if cars were as heavy as they were in 1976. The president now proposes a fuel economy increase of similar magnitude in an even quicker time frame -- to 39 mpg by model year 2016 from 27.5 mpg now. Given the time it takes for new technologies to be developed, tested and incorporated into new car models, it is likely that down-weighting of cars will be an important means of meeting the new standard. And one result again could be highway deaths that might otherwise not have occurred. ~Robert Grady in today's WSJ Posted 2:42 PM Post Link 13 Comments April Jobless Rate Falls in 21 States, Stays the Same in 11 States; Best State Jobs Report In A Year Regional and state unemployment rates were little changed in April. Twenty-one states recorded over-the-month unemployment rate decreases, 18 states and the District of Columbia registered rate increases, and 11 states had no rate change, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. MP: April's report was the best state unemployment report in a year, measured by the number of states experiencing either a decrease in jobless rate (21 states in April including CA, FL, NY, TX, MN, WI, MO, etc.) or no rate change (11 in April) compared to the previous month. The last time that the jobless rate for 32 states either decreased or stayed the same compared to the previous month was last April 2008, when the BLS reported that 28 states and the District of Columbia recorded over-the-month unemployment rate decreases and 8 states had no change (total of 36 states). For example, in December 2008 all 50 states and D.C. recorded over-the month unemployment rate increases, in January 2009 49 states and D.C. recorded over-the month increases, in February 2009 there were 49 states and D.C. with jobless rate increases, and in March 2009 there were 46 states with rate increases from the previous month and 3 with no change. From the data in Table 3 of today's report, it looks like some of the 18 states that recorded jobless rate increases in April had pretty large increases like Michigan (0.30% increase), Ohio (0.50% increase), Illinois (+0.40%), Connecticut (+0.40%), Rhode Island (+.50%), W. Va. (+0.7%), and those increases were much greater than the monthly decreases of -.10% or -.20% in many of the 21 states that recorded decreases in their April unemployment rates. That would explain why the national jobless rate increased in April to 8.9%, even though 21 states had lower rates in April compared to March. Bottom Line: The fact that 21 states recorded decreases in monthly unemployment rates for April, and 11 states recorded no change in rate for the first time in a year, seems like a positive sign that job markets in most states around the country are stabilizing and recovering. The employment problems that persist are concentrated in certain Rust-belt states like MI, IL and OH, and high-tax states like CT and RI. Posted 9:29 AM Post Link 9 Comments Quote of the Day on the Global Network System Our modern living standards are almost entirely the result of investment, entrepreneurial discovery, and gains from depersonalized trade - trade between people who do not know each other and often never meet. As Adam Smith noted long ago, the division of labor is limited by the extent of the market. Much like a telephone or an Internet system, a market economy is a network good. As the size of the market expands from the local town or village to the region, nation, and beyond, network participants derive larger and larger benefits from trade, specialization, and economies of scale. For those connected to the global market, this system generates employment opportunities, high productivity per worker, and a vast array of consumer goods that are available at almost unbelievably low prices. This network system makes high-income levels and living standards possible. ~From James Gwartney's 2008 Presidential Address to the Southern Economic Association via Cafe Hayek MP: It also could be noted that in the international network system known as the Global Economy, the gains from trade do not depend on whether the participants (buyers and sellers) both have driver's licenses from the same state (intra-state trade) or different states (interstate trade), and further don't depend on whether the participants have passports from the same countries (intra-country trade) or different countries (international trade). Posted 7:01 AM Post Link 7 Comments THURSDAY, MAY 21, 2009 When Will We Know For Sure Recession is Over? 2011 There has been a lot of discussion lately about green shoots, mustard seeds and an end to the recession sometime this year. How long would it take for the NBER to make the official announcement that the current recession is over? Let's look at the last two recessions. The last recession ended in November 2001, but the official announcement by the NBER didn't come until July 17, 2003, almost 20 months after the recession was over. The 1990-1991 recession ended in March of 1991, but the NBER official announcement that the recession ended was not released until December 22, 1992, almost 21 months later. Let's be optimistic and assume that the recession ends in the middle of 2009, and let's pick June 2009 as a possibility. In that case, given the past record of the NBER, we wouldn't know officially that the recession ended until February or March of 2011. Bottom Line: Under the most optimistic circumstances, we won't know until 2011 that the recession has officially ended. Posted 8:39 PM Post Link 7 Comments Scientific Calculators: The Good Old Days Are Now Pictured above is the HP-35, Hewlett-Packard's first pocket calculator and the world's first scientific pocket calculator. The HP-35 was available from 1972 to 1975, and retailed then for $395 (more than $2,000 it today's dollars). Market studies at the time had shown no market for pocket sized calculators. However, HP co-founder Bill Hewlett began development of a "shirt-pocket sized calculator," and it turned out that the marketing studies were wrong. In the first months orders were exceeding HP's expectations as to the entire market size. 100,000 HP-35 calculators were sold in the first year, and more than 300,000 by the time it was discontinued in 1975, 3 and 1/2 years after its introduction. The new HP 35s Scientific Calculator was introduced in 2007 to commemorate the 35th anniversary of the HP-35, and it sells today for about $50, or 1/40th the price of the original HP-35 in constant dollars. HT: Lee Coppock Update: The calculator used three rechargeable 'AA'-sized NiCd batteries assembled into a removable proprietary battery pack. Thanks to Tseeba for the information. Posted 7:59 PM Post Link 18 Comments Policy Ineffectiveness Theory Demonstrated Another policy response was the Economic Stimulus Act of 2008 passed in February. The major part of this package was to send cash totaling over $100 billion to individuals and families in the United States so they would have more to spend and thus jump-start consumption and the economy. Most of the checks were sent in May, June, and July. As would be predicted by the permanent income theory of consumption, people spent little if anything of the temporary rebate, and consumption was not jump-started as had been hoped. The evidence is presented in the figure above. The top line shows how personal disposable income jumped at the time of the rebate. The lower line shows that personal consumption expenditures did not increase in a noticeable way. As with the earlier charts, formal statistical work shows that the rebates had no statistically significant increase in consumption. ~From Stanford professor John Taylor's paper "The Financial Crisis and the Policy Responses: An Empirical Analysis of What Went Wrong" (HT: Lee Coppock) This is a good example of the Policy Ineffectiveness Proposition, which suggests that "governments are powerless in the management of output and employment in an economy." Posted 2:56 PM Post Link 6 Comments Child’s Ability to Delay Gratification is a Predictor of Future Success, Higher SAT Scores By 200 Points In the late 1960s, Stanford University conducted an experiment on young childrens' self-control and ability to delay gratification. Researchers would give young children a choice: the child could either eat one marshmallow right away or, if he or she was willing to wait while the researcher stepped out of the room for a few minutes, the child could have two marshmallows when the researcher returned. If the children rang a bell on the desk the researcher would come running back, and the child could eat one marshmallow but would forfeit the second. Most of the children struggled to resist the treat and held out for an average of less than three minutes. About 30% of the children successfully delayed gratification until the researcher returned, some fifteen minutes later. These kids wrestled with temptation but found a way to resist. An analysis of the results showed that the children who rang the bell quickly, seemed more likely to have behavioral problems, both in school and at home. They got lower S.A.T. scores. They struggled in stressful situations, often had trouble paying attention, and found it difficult to maintain friendships. The child who could wait fifteen minutes had an S.A.T. score that was, on average, 210 points higher than that of the kid who could wait only thirty seconds. ~The New Yorker Posted 1:58 PM Post Link 16 Comments Does the 58-Point Increase in the Philly Fed Forecast Index Signal the End of Recession? The Philadelphia Fed reports today that the Six-Month Indicators Show Continued Improvement: Broad indicators of future activity showed improvement again this month. The future general activity index remained positive for the fifth consecutive month and increased 11 points, from 36.2 in April to 47.5. The index has now increased 33 points in the past two months (see chart above, click to enlarge). The indexes for future new orders and shipments also improved, increasing 13 and 14 points, respectively. For the first time in eight months, the percentage of firms expecting employment to increase over the next six months exceeded the percentage expecting declines (26 percent versus 16 percent). The future employment index jumped 22 points, to its highest reading since last September. The six-month capital expenditure index showed a modest four-point improvement, increasing for the second consecutive month; at -0.2 the index is 22 points higher than its record low in March. MP: Notice in the chart above that in 2001 a 60-point increase in the forecast index signalled the end of the 2001 recession. Hopefully the recent 58-point increase in the future activity index since December 2008 is signalling the end of the current recession. According to the Philadelphia Fed, "Most broad indicators for future business conditions improved markedly again this month, suggesting that an increasing number of the region's manufacturing executives expect a recovery in business activity before the end of the year." Posted 10:39 AM Post Link 14 Comments Wal-Mart: Everyday Job Creator: 1,400 in May JACKSONVILLE, Fla., May 13, 2009 – A new Walmart opens this month in Jacksonville, bringing 400 new jobs, savings for local shoppers and an increase in tax revenue to support the area’s economy. Nonprofit organizations will also benefit from the retailer’s ongoing charitable contributions and support for community projects. The Walmart, located at 10251 Shops Lane, will be open to customers at 8:15 a.m., Wednesday, May 20th. MARICOPA, Ariz., May 15, 2009 – The new Walmart in Maricopa will celebrate its grand opening this week, bringing the community 320 new jobs, support for local organizations and Walmart’s unbeatable prices on a full line of groceries and general merchandise. The new store, located at 41650 W. Maricopa Casa Grande, will open at 8 a.m., Wednesday, May 20 and give local shoppers a glimpse at Walmart’s next generation of store design and customer experience. CAMDEN, Ark., May 14, 2009 – A new Walmart opens this month in Camden, bringing 170 new jobs, savings for local shoppers and an increase in tax revenue to support the area’s economy. Nonprofit organizations will also benefit from the retailer’s ongoing charitable contributions and support for community projects. The Walmart, located at 950 California Ave., will be open to customers at 8 a.m., Wednesday. WAL-MART MARKET TO BRING ABOUT 90 JOBS TO LARGO -- The 42,000-square-foot former Kash n' Karry in southwest Largo has been a sign of the harsh reality of the stark economic times. But things are looking up for the once-vacant building. Scheduled to open as a Wal-Mart Neighborhood Market on July 15, the store is seeking potential workers. Wal-Mart is looking to hire at least 90 people to staff the 24-hour, seven-day-a-week grocery store. New Albuquerque Wal-Mart Hiring 420 -- Wal-Mart is hiring 420 people for its new Albuquerque Supercenter, which is scheduled to open July 15. "It's almost like bringing hope back to the community," said store manager Alberta Garcia. "When you have all these companies laying off people and here we are bringing 420 jobs in." Posted 7:22 AM Post Link 60 Comments WEDNESDAY, MAY 20, 2009 Aren't Regulations A Form of a Tax? Remember when Obama said that not one single American making under $250,000 would pay a single dime more in federal taxes? Well the new emission standards Obama wants will make the cars we all buy as much as $600 - $1,300 more expensive. Link. Posted 10:20 PM Post Link 15 Comments The Great Driving Reduction: Consumers Save Money Voluntarily, With No New Legislation According to data released today from the Federal Highway Administration, travel on all roads and streets in the United States fell by -1.2% in March 2009 compared to March 2008. This marks the 17th consecutive month of traffic volume decline (starting in Nov. 2007) compared to the same month in the previous year. The moving 12-month total for traffic volume has fallen now for 16 consecutive months, going back to December 2007 (see chart above). The 12-month moving total for March is the lowest traffic volume (2,914 billion miles) in any month since February 2004 (see red line on the chart above, click to enlarge). WASHINGTON -- President Barack Obama is asking consumers to put their money -- up to $1,300 per new vehicle by 2016 -- behind his plan for higher efficiency standards for cars and trucks and tougher rules on their greenhouse gas emissions. In return, Obama said Tuesday in unveiling the plan, drivers would make up the higher cost of more fuel-efficient, cleaner vehicles by buying less gas at the pump. It would take just three years to pay off the investment and would, over the life of a vehicle, save about $2,800 through better gas mileage, the president said. MP: It seems like consumers have already decided on their own that voluntarily buying less gas at the pump can be in their own self-interest, and are now driving the same number of miles as they were five years ago, even with more cars and more drivers. Without stricter CAFE standards, consumers on their own have been driving less, have been buying less gas at the pump, and in the process have reduced greenhouse gas emissions. Posted 9:43 PM Post Link 6 Comments Positive Relationship Indexed. Posted 9:24 PM Post Link 2 Comments Chinese Demand Increases, BDI Hits 7-Mo. High May 19 (Bloomberg) -- The Baltic Dry Index, a measure of shipping costs for commodities, rose to a seven-month high in London on accelerating Chinese demand for iron ore. China’s imports of iron ore, used in steelmaking, jumped 33% in April, setting a record for a third month, the customs office said last week. The nation, the world’s biggest steel producer, is stockpiling commodities as part of a reallocation of its sovereign wealth, Brian Jackson, senior strategist at the Bank of Canada in Hong Kong, said yesterday. The index tracking transport costs on international trade routes added 39 points, or 1.5%, to 2,644 points, according to the Baltic Exchange. That’s the highest since Oct. 8 and marks a 13th consecutive advance. Rentals climbed for every class of ship tracked by the bourse. MP: The Baltic Dry Index advanced again today (May 20), for the 14th consecutive day, rising another 21 points to 2,665. Posted 7:11 PM Post Link 2 Comments Markets in Everything: Free Money Saving Website BillShrink provides a free, web-based service that provides users with personalized recommendations for everyday services such as cell phone plans and credit cards. These recommendations are computed in real-time by matching your indicated usage profile against literally millions of different market options. The results enable you to view and compare options so that you can make a well-informed decision that maximizes your savings. Posted 3:40 PM Post Link 5 Comments Football Justice and Supreme Court Justice President Obama's articulated criteria for his nominee to the U.S. Supreme Court is: "We need somebody who's got the heart to recognize -- the empathy to recognize what it's like to be a young teenage mom, the empathy to understand what it's like to be poor or African-American or gay or disabled or old. And that's the criteria by which I'm going to be selecting my judges." The Pittsburgh Steelers have won six Super Bowl titles, seven AFC championships and hosted 10 conference games. No other AFC or NFC team can match this record. By contrast, the Arizona Cardinals' last championship victory was in 1947 when they were based in Chicago. In anyone's book, this is a gross disparity. Should the referees have the empathy to understand what it's like to be a perennial loser and what would you think of a referee whose decisions were guided by his empathy? Suppose a referee, in the name of compensatory justice, stringently applied pass interference or roughing the passer violations against the Steelers and less stringently against the Cardinals. Or, would you support a referee who refused to make offensive pass interference calls because he thought it was a silly rule? You'd probably remind him that the league makes the rules, not referees. I'm betting that most people would agree that football justice requires that referees apply the rules blindly and independent of the records or any other characteristic of the two teams. Moreover, I believe that most people would agree that referees should evenly apply the rules of the games even if they personally disagreed with some of the rules. The relationship between Supreme Court justices and the U.S. Constitution should be identical to that of referees and football rules. The status of a person appearing before the court should have absolutely nothing to do with the rendering of decisions. That's why Lady Justice, often appearing on court buildings, is shown wearing a blindfold. It is to indicate that justice should be meted out impartially, regardless of identity, power or weakness. ~Walter Williams Posted 7:14 AM Post Link 27 Comments TUESDAY, MAY 19, 2009 TANSTAAFL: Credit Card Edition; Creditworthy Borrowers Will Now Subsidize Riskiest Borrowers NY TIMES -- Credit cards have long been a very good deal for people who pay their bills on time and in full. Even as card companies imposed punitive fees and penalties on those late with their payments, the best customers racked up cash-back rewards, frequent-flier miles and other perks in recent years. Now Congress is moving to limit the penalties on riskier borrowers, who have become a prime source of billions of dollars in fee revenue for the industry. And to make up for lost income, the card companies are going after those people with sterling credit. Banks are expected to look at reviving annual fees, curtailing cash-back and other rewards programs and charging interest immediately on a purchase instead of allowing a grace period of weeks, according to bank officials and trade groups. “It will be a different business,” said Edward L. Yingling, the chief executive of the American Bankers Association, which has been lobbying Congress for more lenient legislation on behalf of the nation’s biggest banks. “Those that manage their credit well will in some degree subsidize those that have credit problems.” (Bold added.) HT: R Adams Posted 9:37 PM Post Link 11 Comments Markets In Everything: Digital Legacy Your will (or estate or trust) protects your car, your house, your retirement account, and all your other assets for you. It ensures these valuables make their way to your spouse, siblings, children, or other loved ones. But what happens to all the assets you've created on the Internet, from your email address(es) to your PayPal account to your Facebook profile? Most of the websites we all use on a regular basis have little-to-no provisions in place for a loved one to transfer account information in a time of need. In some cases you might even need to get a lawyer involved just to access an email inbox. Your digital legacy needs protection, and we've built Legacy Locker to help solve these problems. Legacy Locker is a safe, secure repository for your digital property that lets you grant access to online assets for friends and loved ones in the event of death or disability. HT: Steve Horwitz Posted 9:27 PM Post Link 0 Comments The Great Right North: Lessons From Canada WASHINGTON POST -- Long derided by American conservatives as "socialist" and praised by the left for its generous government spending, Canada is casting off those stereotypes. Over the past few years, while U.S. politicians presided over huge increases in spending and debt, the Canadian government tightened its belt, slashed tax rates and balanced budgets. Consider these trends: See another version here at Cato's website. HT: Dennis Gartman Posted 6:48 AM Post Link 20 Comments MONDAY, MAY 18, 2009 Average Home Price in Detroit Falls to $11,533; Monthly House Payment Would Be Less Than $50 According to the Michigan Association of Realtors and Detroit Board of Realtors (data here), the average sales price of a Detroit home fell to $11,533 in April (Year-to-Date), a -43.8% decline from the $20,514 average home price during the same period last year (see chart above). 2009 year-to-date unit sales increased by 23.1% to 4,139 homes, compared to 3,360 Detroit homes sold last year over the same period. From the $97,850 peak Detroit home price in 2003, prices have fallen by an amazing 88%. With a 20% down payment on a $11,533 average priced home in Detroit, the monthly payments on a 30-year fixed-rate mortgage at 5% would be only $49.53. For the entire state of Michigan, the average YTD home sales price has fallen by -28% to $87,033 through April 2009, compared to last year's average price of $120,481 for the same period. Posted 8:34 PM Post Link 14 Comments Camera Phones to Interpret Visible World for Blind iVisit, a company out of Santa Monica, California that specializes in video teleconferencing applications, has teamed up with the National Institutes of Health to turn a mobile phone's camera into an eye for the blind. Using advanced image recognition software to identify what is in front of the phone, the system reads off what it is seeing. Watch this demo video below of the software in action: Link. Posted 3:43 PM Post Link 3 Comments Volatility Index Falls To A Level Suggesting "Market Correction is Complete, Back to Business As Usual" The CBOE Volatility Index closed today at just barely above 30 (30.24), falling almost 3 points from Friday's close of 33.12, and is now more than 50 points below the November highs that were above 80. According to Yale Professor Ian Ayres at the Freakonomics Blog on December 24, 2008: "When it (the VIX) drops below 30%, it will be a strong indication that the market correction is complete and we’re back to business as usual." Posted 3:29 PM Post Link 5 Comments Exhibit A: Tax The Rich, Lose The Rich BUFFALO NEWS -- Ending any speculation about another possible run for governor, Rochester businessman and Sabres owner B. Thomas Golisano said Thursday he will be moving his legal residence to Florida to escape New York state taxes. Golisano told a gathering of Rochester business executives that he will remain as owner of the Buffalo hockey team, but he is fleeing the Empire State to avoid paying $13,000 a day in state income taxes (MP: Almost $5 million per year). The billionaire earlier this year told The Buffalo News that the only thing keeping him in New York was his family. “The only reason I’m staying in this state is I have family here. Economically, it just doesn’t make sense,” he said in February. But since then, Gov. David A. Paterson and lawmakers approved a state budget that will raise $4 billion in new income taxes this year on wealthier residents. In Golisano’s case —and anyone else making more than $500,000 this year — he is seeing his state tax rate go from 6.85% to 8.97%. HT: R. Adams Posted 12:13 PM Post Link 39 Comments Tax The Rich, Lose The Rich Here's the problem for states that want to pry more money out of the wallets of rich people. It never works because people, investment capital and businesses are mobile: They can leave tax-unfriendly states and move to tax-friendly states. Updating some research from Richard Vedder of Ohio University, we found that from 1998 to 2007, more than 1,100 people every day including Sundays and holidays moved from the nine highest income-tax states such as California, New Jersey, New York and Ohio and relocated mostly to the nine tax-haven states with no income tax, including Florida, Nevada, New Hampshire and Texas. We also found that over these same years the no-income tax states created 89% more jobs and had 32% faster personal income growth than their high-tax counterparts. We believe there are three unintended consequences from states raising tax rates on the rich. First, some rich residents sell their homes and leave the state; second, those who stay in the state report less taxable income on their tax returns; and third, some rich people choose not to locate in a high-tax state. Since many rich people also tend to be successful business owners, jobs leave with them or they never arrive in the first place. This is why high income-tax states have such a tough time creating net new jobs for low-income residents and college graduates. ~Art Laffer and Stephen Moore in today's WSJ Bottom Line: If you tax something, you get less of it. Is that so hard to understand? Posted 9:25 AM Post Link 10 Comments Plagiarism Update Plagiarism update, following this CD post. 1. NY Time’s Maureen Dowd Caught Plagiarizing 2. It is common online behavior to copy and paste content off a website. Right or wrong, it happens, but now with Tracer (available free in Beta from Tynt), you can watch each instance and begin to learn what people are most interested in. Each time a user pastes content from your website into an email, blog or website , we automatically add a URL link back to your site’s original content. This ensures you get credit for content that you have created. You can’t stop users from copying off your site but you can make the pasted content your virtual ambassador! Read more: "Tynt Tracer » Take Credit" - http://tracer.tynt.com/take-credit#ixzz0FrncutQC&A) (Note: Since I copied and pasted the text above from the Tynt website, it automatically added the reference and link above. And when you go to that link, it highlights in yellow the text that was copied.) HTs: Suzanne Perry (1) and David Damore (2). Posted 8:58 AM Post Link 5 Comments Markets in Everything: Dynamic Pricing for Baseball Baseball Tickets Too Much? Check Back Tomorrow Because baseball teams set their prices months before opening day and resist changing them later, they have trouble reacting to the unexpected, like the weather, winning and losing teams or, this year, the ferocity of an economic downturn. The San Francisco Giants are experimenting with a possible solution — software that weighs ticket sales data, weather forecasts, upcoming pitching matchups and other variables to help decide whether the team should raise or lower prices right up until game day. The Giants are the first major league team to test the software, which some industry analysts say could transform the way teams adjust to the ebb and flow of the season, not unlike how airlines, hotels and rental car companies — which also use dynamic pricing — adjust to changes in the travel industry. NY Times Posted 8:37 AM Post Link 3 Comments The Communists Are Out, India's Market Soars MUMBAI, India (AP) — India's stock market surged an unprecedented 17%, forcing trade to close for the day, after the Congress Party's definitive victory in national elections set the scene for long-delayed economic reforms. Within seconds of trading, the Bombay Stock Exchange's benchmark Sensex vaulted 2,110.79 points, or 17.3%, to 14,284.21, triggering the historic shutdown Monday (see chart above). Infrastructure, banking and real estate companies led gains. Putting to rest fears of an unwieldy coalition, the victory raised hopes of a revival in foreign direct investment and economic growth, as well as tax reform and significant infrastructure spending. The near collapse of India's once powerful communist parties — which lost more than half their parliamentary seats — paves the way for long-awaited economic reforms, many of which the Left had blocked over the last five years. The Congress party now has more room to ease restrictions on foreign investment in insurance, retailing and banking. The government may also sell some of its stakes in state-run oil, banking, and fertilizer companies. The nation's pension regulator could get proper legal standing, which would encourage greater investment. And some steps might be taken to loosen hidebound labor laws, like allowing contract labor, analysts and business groups say. Citigroup economist Rohini Malkani said the result would likely revive India's investment growth, which was a key driver of the nation's four-year boom that's now waning in the face of the global slump. MP: The BSE reached an 8-month high, the highest level since Sept. 11, 2008, and is up by almost 50% from the early March bottom. Posted 8:26 AM Post Link 7 Comments SUNDAY, MAY 17, 2009 According to OECD, US GDP Fell By -1.6% in Q1 Bureau of Economic Analysis -- Real GDP -- the output of goods and services produced by labor and property located in the U.S. -- decreased at an annual rate of 6.1% in the first quarter of 2009, (that is, from the fourth quarter to the first quarter), according to advance estimates released by the Bureau of Economic Analysis. In the fourth quarter, real GDP decreased 6.3%. The Times of London -- The eurozone economy slumped by a record 2.5% in the first three months of the year, dragged down by Germany, which recorded the biggest drop in its GDP in nearly 40 years. The German economy, the engine room of the 16-nation eurozone, contracted by 3.8% in the first quarter of the year, battered by the fall in demand for manufactured goods. The US economy shrank by 1.6% in the same period. MP: Notice how real GDP growth gets reported differently in the U.S. than in Europe. In the U.S., the quarterly real GDP growth rates are annualized by multiplying the quarterly percent growth rate by four (-1.6% quarterly x 4 = -6.4%, difference from -6.3% above due to rounding). European countries and the OECD report quarterly growth rates for GDP from the previous quarter, without annualizing. According to the OECD (data here) and the news report above, U.S. real GDP fell by 1.6% in the first quarter of 2009, and that rate is stated as a quarterly rate, not an annual rate. Posted 9:17 PM Post Link 6 Comments Stronger the Drug Laws, The Stronger the Drugs Washington, D.C. -- Today, the Office of National Drug Control Policy (ONDCP) released the latest analysis from the University of Mississippi's Potency Monitoring Project, which revealed levels of THC - the psychoactive ingredient in marijuana - have reached the highest-ever levels since scientific analysis of the drug began in the late 1970s. According to the latest data on marijuana samples analyzed to date, the average amount of THC in seized samples has reached a new high of 10.1%. This compares to an average of just under 4% reported in 1983 and represents more than a doubling in the potency of the drug since that time. According to data from the White House (here and here), the graph below shows that the purity of powder cocaine more than doubled between the early 1980s and the 1990s and after. MP: As a general economics principle, I think it would be safe to say that the stronger the drug laws, and the stronger the enforcement of drug laws, the stronger the drugs. Exhibit A: The original drug of choice made from poppies in the 1800s was opium, but after it became illegal, the market for heroin was born, which is made from opium/morphine. Exhibit B: During prohibition in the U.S. during the 1930s, most illegal "moonshine" was the strongest possible alcohol like "bathtub gin," etc. Nobody bothered making illegal beer or wine, everybody wanted the strongest, purest alcohol possible. Exhibit C: Going from powder cocaine to crack cocaine in the 1980s and 1990s, to get more "bang for the buck." Top graph HT: Pete Boettke Posted 4:58 PM Post Link 10 Comments About Me Name: Mark J. Perry Location: Washington, D.C., United States Dr. Mark J. Perry is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan. Perry holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University near Washington, D.C. In addition, he holds an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota. In addition to a faculty appointment at the University of Michigan-Flint, Perry is also a visiting scholar at The American Enterprise Institute in Washington, D.C. View my complete profile Links Google Search of Carpe Diem Twitter University of Michigan-Ann Arbor My Web Page University of Michigan-Flint University of Michigan-Flint MBA Blackboard Wall Street Journal New York Times Drudge Report Thomas Sowell's Columns Enter your email address to receive a daily email with new Carpe Diem posts: Delivered by FeedBurner Subscribe in a reader Blogs I Read Enterprise Blog Marginal Revolution Greg Mankiw's Blog Freakonomics Cafe Hayek Newsalert Economix Larry Kudlow's Money Politic$ Club for Growth Division of Labour Adam Smith Institute Blog Instapundit Powerline Kids Prefer Cheese John Hanger's Facts of the Day Bob McTeer's Blog Tax Prof Blog Carpe Diem Infectious Greed Calafia Beach Pundit Coyote Blog Newmark's Door Yoani Sanchez - Generation Y Who's Linking to Carpe Diem? 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