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Today's News

September 2, 2010 | New York Times Editorial
The Financial Times reported this week that lawyers for corporate America are warning of a “logistical nightmare” from a provision in the new financial reform law that requires companies to disclose the ratio between a chief executive’s pay package and that of a typical employee. The lawyers say that the ratio would be unfairly complex to calculate and could encourage false comparisons.
September 2, 2010 | Karlyn Bowman in AEI
In this AEI Public Opinion Study, we bring together existing trend questions from many pollsters about the subjects described in the title above to get a sense of how anxious or economically insecure Americans feel. We look here at what people say about their own lives and those of their friends and family, and not at what people say about "most Americans" or "Americans in general." We give substantial weight to what people say about their own situations, which we feel they know best.
September 2, 2010 | Micahel Boskin in Wall Street Journal
The administration's 'summer of recovery' has fizzled in almost every way imaginable. The growth rate is less than half what it was at this stage after the 1974-75 and 1981-82 recessions. How bad is it?
September 2, 2010 | Real Time Economics
Federal Reserve Bank of Dallas President Richard Fisher said Wednesday the recovery of the U.S. economy “will take quite some time,” and that improved regulatory and fiscal policies are needed in order to help the process. Fisher, who isn’t a voting member of the interest-rate-setting Federal Open Market Committee this year but will be a voting member in 2011, said that an improved regulatory and fiscal environment should help to activate the economy. Business owners will accept policies they are not “happy” with because at least they will be more certain about the rules, he said.
September 2, 2010 | Morgan Stanley
We are downgrading our outlook for 2H US real growth to 2-2.5% from 3-3.5% previously. This downgrade from above-trend to below-trend 2H growth has important implications for forecasts of the unemployment rate, inflation and monetary policy. If policy does respond to this near-term weakness, the outlook in 2011 could be better than our current 3% baseline.
September 2, 2010 | Financial Times
Dick Fuld, the former chief executive of Lehman Brothers, squared off against Federal Reserve officials and his former peers on Thursday as he argued that his investment bank could and should have been saved. Almost two years since the collapse of Lehman roiled markets, Mr Fuld mounted his most robust defence yet, accusing regulators in testimony to the Financial Crisis Inquiry Commission of pushing the bank into bankruptcy and failing to get a grip on the crisis early in 2008.
September 2, 2010 | National Press Club
The current recession has been fundamentally different from other postwar recessions. Rather than being caused by deliberate monetary policy actions, it began with interest rates at low levels. It is a recession born of regulatory failures and unsound practices that contributed to a housing bubble and eventually a full-fledged financial crisis. Precisely what has made it so terrifying and so difficult to cure is that we have been in largely uncharted territory.
September 1, 2010 | Robert Rubin in Wall Street Journal
The question of how to address the income and other tax cuts that expire this year is already eliciting many conflicting views. But action on the estate tax should not wait. Our country is losing revenue that, with its stressed fiscal conditions, it can ill afford to forego. The question of how to address the income and other tax cuts that expire this year is already eliciting many conflicting views. But action on the estate tax should not wait. Our country is losing revenue that, with its stressed fiscal conditions, it can ill afford to forego.
September 1, 2010 | Martin Wolf in Financial Times
Debate is emerging on how much of the surge in unemployment is structural. My answer, from European experience, is that one way to ensure it becomes structural is to let it linger. In the short run, the simplest way to prevent that from happening is to expand demand and so output. Since there is huge slack in the labour market, not the slightest threat of inflation – far more a risk of deflation – and no constraint from bond or foreign exchange markets on further monetary and fiscal stimulus, these are the policies that have to be pursued.
September 1, 2010 | Vincent Reinhart in AEI
Our research found real per capita gross domestic product growth tends to be much lower during the decade following crises. Unemployment rates are higher, with the most extreme increases in the most advanced economies that experienced a crisis. It gets worse. Where house price data are available, 90 per cent of the observations over the decade after a crisis are below their level the year before the crisis. Median prices are 15 to 20 per cent lower too, with cumulative declines as large as 55 per cent. Credit is also a problem.