Using mid-December exchange-rate data from FT.com, the chart above shows the one-year forward discount or premium for the US dollar vs. the Euro and British Pound in 2005, 2006, and 2007.
When Tata is done buying a company, it should look the same as before, “except now it’s owned by someone in India,” said Ratan Tata, chairman of the Tata Group.
Even more predictable than the post-Thanksgiving appearance of shopping-mall Santas is the inability of pundits at this time of year to say or to write “commercialism” without prefixing to it the word “crass.”
I challenge this notion. Commerce is peaceful. It involves sellers working hard and taking risks to bring to market goods and services that consumers want to buy. No one forces anyone to do anything; all is voluntary.
What truly is crass is politics. Far more enlightened and ethical behavior is on display during any one day in a shopping mall than the most intrepid observer will find in a century on Pennsylvania Avenue.
~George Mason Economist and Cafe Hayek blogger Don Boudreaux
Exhibit A: See graph below (click to enlarge) of the Adjusted Monetary Base, from the St. Louis Federal Reserve, from 2002-2007. Notice the decline in growth from 10% to 2%, suggesting a deflationary trend in high-powered money.
Exhibit B: See graph below of the Adjusted Monetary Base vs. M1 Money Supply, from 2002-2007. Notice that as the growth in high-powered money growth, controlled by the Fed, has come down from 10% in 2002 to 2% in 2007, the M1 Money Supply has stablized at about $1.36 trillion.
SAN FRANCISCO–Buffett indirectly blamed the Bush administration for a tax code he said is out of whack.
“In the last seven-eight years what has happened is that the super-rich have gotten a huge break,” said Buffett, one of the world’s richest people with a net worth of $52 billion, according to Forbes magazine.
In a previous post, I challenged proponents of tax increases to raise taxes on themselves immediately by making a voluntary gift to to the U.S. Treasury, and not waiting for the Bush tax cuts to expire. After all, if forced increases in taxes are desirable by future changes in the tax code, then voluntary tax increases by rich taxpayers like Buffet and the Clintons right now should be desirable.
Here’s another idea for Buffet and the Clintons. If they think that the tax codes in previous years were more equitable, fair and desirable then they can pay under the old rates for their 2007 tax returns. Here are the tax rates for 2000 (highest rate 39.6%), 2001 (highest rate 39.1%), and 2002 (highest rate 38.6%). In other words, if they don’t like the Bush tax cuts (highest rate 35%), they don’t have to accept them, they can file under the pre-Bush tax rates, i.e. the Clinton tax rates.
- For 2005, the richest 1% paid about 39% of all income taxes that year (see chart above).
- The richest 5% paid a little less than 60%, and the richest 10% paid 70%.
- The richest 1.3 million tax-filers — those Americans with adjusted gross incomes of more than $365,000 in 2005 — paid more income tax than all of the 66 million American tax filers below the median in income; ten times more.
For the political left and most of the media, this means only that the rich are getting richer. However:
- The rich showed more rapid gains in reported income shares in the 1990s than in the first half of this decade.
- The share of the richest 1 percent jumped to 20.8% of total income in 2000, from 14% in 1990, but increased only slightly to 21.2% in 2005.
- Notably, however, the share of taxes paid by the top 1% has kept climbing this decade — to 39.4% in 2005, from 37.4% in 2000.
- The share paid by the top 5% has increased even more rapidly.
In other words, despite the tax reductions of 2001 and 2003, the rich saw their share of taxes paid rise at a faster rate than their share of income. This makes it hard to pin their claim of “rising inequality” on the Bush tax cuts, though the income redistributionists are trying. By this measure, the Clinton years were far worse for “inequality.”
Conclusion from the WSJ: “We hate to break up the media’s egalitarian chorus with these details, but facts are facts. If Democrats really want to soak the rich, they’ll keep tax rates where they are, or, better, lower them some more.”
According to the BLS labor report on December 7, “Nonfarm payroll employment continued to trend up in November (94,000), and the unemployment rate held at 4.7%.”
What didn’t get reported anywhere in the media (that I could find), and was only reported by the White House, is that November 2007 marked the 51st straight month of employment growth, setting an all-time record for the longest continuous run of job growth on record (back to 1939, see chart above). The previous record of continuous job growth was set back in the July 1986 to June 1990 period, when there were 48 straight months of employment growth.
Bottom Line: In each of the last three months (September, October, and November), the Goldilocks economy has set new all-time records for continous monthly job growth, and yet this has gone virtually unreported. Never before in U.S. history have we experienced an extended period of job growth like in the last four years, and all we hear about are recessionary fears, and gloom and doom.
NY Times: Swiss chocolatiers, having long ago conquered markets in Europe and North America, are now aiming at the vast expanses of Russia, India and China, making Swiss chocolate a case study in globalization.
Reminder: Trade works both ways. As economies like India, Russia, China, and Brazil become wealthy and prosperous by producing goods and services for the U.S. and European markets, the workers of those economies also become increasingly wealthy and prosperous consumers of American and European products.
Exhibit A: Swiss chocolate.
WASHINGTON – The Supreme Court on Monday (December 10) said judges may impose shorter prison terms for crack cocaine crimes, enhancing judicial discretion to reduce the disparity between sentences for crack and cocaine powder.
WASHINGTON – The U.S. Sentencing Commission voted unanimously Tuesday (December 11) to allow some 19,500 federal prison inmates, most of them black, to seek reductions in their crack cocaine sentences.
Even after the change, prison terms for crack cocaine still are two to five times longer on average than sentences for powder cocaine, the result of a 20-year-old decision by Congress to treat crack more harshly.