So much for the afterglow. After an impressive Election Day rally that took the Dow Jones Industrial Average up more than 300 points, the market puked out 928 points in the following two days confronted with a gloomy jobs outlook. Unemployment hit 6.5% and the number of those collecting jobless benefits hit a 25-year high.
Respect for human rights is gaining in importance in international agreements, but who is to judge human rights performance? This article discusses new evidence that suggests national governments are not good judges. It draws on evidence from the U.S., which has long tied trade preferences to human rights performance, which shows the U.S. government systematically under-reported human rights violations by Cold War allies.
This article argues that the current combination of a weak dollar and a large current account deficit is explained by long lags in the relation between U.S. external accounts and the real effective exchange rate, high oil prices, and the "return differential" between U.S. holdings of assets overseas and foreign holdings of U.S. assets. A reduction of the U.S. current account deficit could occur with no further dollar weakening.
It took the statisticians of the National Bureau of Economic Research almost a year to confirm what the rest of us already knew, that the U.S. registered a significant decline in economic activity, thus officially entering a period of recession. While I am pleased that the members of NBER take their duties seriously, thereby ensuring that they don't leap to any hasty conclusions, I only wish that similar moderation could be displayed by their colleagues at the Fed and the Treasury.
The fact that after over 30 years of consistent mismanagement and decline, there is still any discussion on whether or not we should allow the now significantly smaller "Big Three" automakers to fail is clear evidence that Washington has lost all common sense.
The current crisis raises serious questions about the role of a lender of last resort. This article provides historical insight into its importance. Such a lender is critical to containing crises, as demonstrated by the frequent autumn harvest financial crises in the U.S. prior to the establishment of the Federal Reserve.