A federal bailout for automakers Chrysler and General Motors won’t fix their problems. I think a bankruptcy of these companies is nearly inevitable.
It might also spell the demise of the UAW.
The clouds of darkness will pass, fear will be removed, and the light of the season will linger in those who seek it.
Ball State University’s Indiana econometric model predicts that earnings in all of Indiana’s
major economic sectors except health care will decline in the next three months.
The Dec. 1 announcement by the Business Cycle Dating Committee of the National Bureau of Economic Research officially dated
the recession back to the fourth quarter of 2007.
During the coming weeks, a number of Indiana cities and counties will be coming to terms with their new budget realities.
Holidays are great fun, but Thanksgiving brings the most memories.
The fixes for poverty, and low-wage workers, are hard, deliberate and done family by family. This is why the cost of the welfare
program reforms implemented in 1996 didn’t plummet with lower enrollment.
Most economists spend some time teaching, but the vast majority of our time is spent doing research.
If you haven’t learned about the crucial issues that our country and state face, don’t vote.
The week of Halloween at the Hicks household is also the week we learn about taxes. It is a natural combination-they are both kind of scary and involve giving up something you’ve worked for to someone else. Having three kids of different ages and interests is especially instructive. My fourth-grader is all about the experience of trick or treating with friends. She is likely to savor every minute chatting, holding hands and skipping along. She is not trying to maximize…
Amid all this joyless market watching, this much is clear: The financial markets and the economy are going to get worse before they get better. But market watching is never a healthy sport, especially since it tends to make us lose track of the real economy at times like these. Over the past couple of weeks, the real economy has shown a bit of resilience. And here in Indiana, really great news has been lost in the wake of the…
It will be some months before we know for sure, but I would wager today that the United States is in a recession. Our unemployment rate is at right about the 50-year average, productivity is up, and living standards never have been higher. Even so, the economy likely has been pushed into recession because uncertainty about credit will dramatically slow hiring and production the next few months. Demand for goods also will be affected. This is financial-market mayhem spreading to…
Underlying the financial turmoil is a significantly dreary problem in housing markets. It is a bit easier to understand, but understanding will almost certainly lead to anger and frustration. The 1995 revisions to the Community Reinvestment Act specifically permitted subprime loans. The intent was laudable enough, to provide lower-income Americans a chance to buy homes and force financing to local businesses. The former worked quite well, but in a 2004 academic paper I reported minimal effect of lending on rural…
After just two tumultuous weeks of financial crisis, the blame casting already has begun in earnest. A little deeper analysis might be warranted before jumping to conclusions. I am going to indulge in the combination of my two careers-one military and one scholarly-to focus on one issue. The Sept. 11, 2001, attacks focused limited Al Qaeda resources on the U.S. economy and the command-and-control systems of our military. The latter attack failed miserably (due both to the robustness of our…
The collapse of Lehman Brothers and the widespread stock sell-off it engendered is a bit scary. It shows those of us on Main Street that more than a year after the subprime mess became daily news, significant and sophisticated financiers still grapple with the effect on their firms. They are now far less significant and sophisticated than they once believed. I’m still uncertain as to how this will end. The U.S. and world economies will emerge stronger, more vibrant and…
It is hard to know what to think about the U.S. Treasury’s takeover of mortgage lending giants Fannie Mae and Freddie Mac. Other than the imminent demise of such charming company nicknames, what will this mean to workers, investors, creditors, mortgage holders and taxpayers? If you are trying to obtain a new mortgage, the bailout (if that’s the right word) should result in modestly lower borrowing costs. If you are an investor (and that mostly means larger banks and a…
After a year or so of writing this column, I’ve learned at least two things. First, if you write about taxes or environmental policy, you are going to be busy reading angry e-mails. Second, almost none of those angry e-mails are from folks who have actually i n c o nve n i e n c e d themselves to perform research on tax or environmental policy. Even though I know these two things, I cannot resist writing about environmental…
ECONOMIC ANALYSIS Marriage has some economic consequences This month marks my parents’ 50th wedding anniversary. And, at the risk of being labeled a hopeless unromantic, I thought I might reflect on some of the economic consequences of marriage. I’ll begin with taxes. Until 1969, when my parents celebrated their 11th anniversary, the federal income tax had no marriage penalty. In fact, from its inception in 1913 until then, married couples enjoyed a modest tax advantage (two deductions on the same…
This month marks my parents’ 50th wedding anniversary. And, at the risk of being labeled a hopeless unromantic, I thought I might reflect on some of the economic consequences of marriage. I’ll begin with taxes. Until 1969, when my parents celebrated their 11th anniversary, the federal income tax had no marriage penalty. In fact, from its inception in 1913 until then, married couples enjoyed a modest tax advantage (two deductions on the same income provided a small edge over singles)….
B e f o r e w r i t i n g about energy matters, I am going to have to make a confession. I am a closet environmentalist. I support a wide range of environmental policies and think it often makes good business sense to go green. But sadly, far too many supporters of environmental policy look at the world through green-colored glasses. One result is that it is increasingly difficult to take many environmentalists seriously. One verdant…
