Wednesday summary: Domitrovic on Don Devine; Jenkins on inequality; PIIE's Lardy on the yuan.

From Forbes, Brian Domitrovic highlights Donald Devine’s spending cuts during the Reagan era.

At The WSJ, Holman Jenkins diagnoses inequality obsession.

In The WSJ, Stephen Moore notes the Senate vote on the Republican small business tax bill.

On The Kudlow Report, Sen. Kay Bailey-Hutchison (TX) debates the plan:



The WSJ explains that yuan convertibility will require substantial financial liberalization in China.

From the Peterson Institute for International Economics, Nicholas Lardy argues that with its current account surplus down and its currency higher, there’s no cause to press China to raise the yuan further.

And on the downside, The Washington Post reports PIIE chief Fred Bergsten making common cause with Occupy Wall Street.

On TGSN, Ralph Benko highlights a pro-gold article by Princeton scholar and one-time Ben Bernanke collaborator Harold James.

At The American, James Pethokoukis critiques arguments that the US should return to 1950s tax rates.

From First Trust, Brian Wesbury suggests big government doesn’t make one any more secure from life’s risks.

In The WSJ, US Trade Rep. Ron Kirk notes rising export of US services.

Monday summary: The Spectator on Sweden's success; O'Grady on Fed policy's impact on Brazil; Kadlec on Laffer's new book.

From The Spectator (UK), Fraser Nelson highlights Sweden’s tax cutting success.

On Forbes, Charles Kadlec reviews Art Laffer’s new book on state tax competitiveness.

In The WSJ, Mary Anastasia O’Grady explains how Ben Bernanke’s low dollar is damaging Brazilian exporters and creating political pressures for its government.

At The WSJ, O’Grady discusses the Fed’s fear of incipient inflation:



At Forbes, Ralph Benko suggests obedience to authority helps explain Washington’s aversion to the gold standard.

The WSJ reports China widening the yuan’s trading range.

From TWS, Bill Kristol rebuts the suggestion that President Reagan favored tax hikes on the rich.

At Forbes, Brian Wesbury argues spending cuts are required to save America from a VAT.

On The Kudlow Report, Larry debates the Buffett Tax vote with Jared Bernstein:



At Forbes, John Tamny critiques lotteries for funding larger government.

In The NYT, Greg Mankiw suggests competition is good for governments too.

Weekend round up: Lewis on gold linked currency; Mundell says gold could play a role in monetary reform; Lowry admonishes the GOP to focus on growth.

The new book to buy – ‘It Shines for All’: The Gold Standard Editorials of The NY Sun.

On Forbes, Nathan Lewis distinguishes between currencies linked to gold vs. backed by gold.

At a leading website in primary state Iowa, Ralph Benko argues the gold standard advantages main street rather than wall street.

On Bloomberg, Robert Mundell suggests monetary reform featuring fixed exchange rates among major currencies, with gold as an intermediary:

FOX: Now, you've written about the role of gold in the world economy, Professor Mundell. Do you think that we're going to see any kind of return to the gold standard?

MUNDELL: I - nothing like the gold standard that existed before 1914. But there could be a kind of Bretton Woods type of gold standard where the price of gold was fixed for central banks and they could use gold as an asset to trade central banks. The great advantage of that was that gold is it’s nobody's liability and it can't be printed. So it has a strength and confidence that people trust. So if you had not just the United States, but the United States and the euro tied together to each other and to gold, gold might be the intermediary, and then with the other important currencies, like the yen and the Chinese yuan and the British pound, all tied together as a kind of new SDR, I think that would be one way the world could move forward toward a better monetary system.

At NRO, Larry Kudlow recounts House Republican leader Eric Cantor’s (VA) focus on jobs and growth.

From Forbes, Bret Swanson explains the budget ramifications of 2, 2.5, 3 and 4 percent annual growth:



In a bellwether column, National Review editor Rich Lowry admonishes the GOP to focus on economic growth:

The unemployment rate is still at 9 percent. According to Gallup, 35 percent of people say the economy is their top concern, and 22 percent say jobs. Just 12 percent cite the federal deficit and debt. Republicans have taken the top concern of roughly one-eighth of the public and made it their existential cause. On top of that, they have taken a subset of the debt issue, the long-term fiscal sustainability of Medicare, and made it their calling card.

On The Kudlow Report, Art Laffer outlines a tax reform agenda to supercharge economic growth:




From Bloomberg, Stephen L. Carter suggests small and medium size businesses are paralyzed by regulatory uncertainty.

At New World Economics, Nathan Lewis continues his explanation of gold’s great long-term stability.

From last year, Chris Mahoney of Granite Springs Asset Management speculates that China could use its dollar assets to peg the euro to the dollar, and by extension to the yuan.

IBD notes gains from international trade.

Weekend update: Lewis on the gold standard; Kudlow on dollar weakness; Mueller on the inconvertible dollar.

From Forbes, Nathan Lewis explains the principles that make the gold standard work.

At NRO, Larry Kudlow argues the dollar has been falling due to the Fed, not due to the government shutdown.

TGSN features a John D. Mueller speech in which he argues the dollar standard leads to monetary-related recessions, elevates the budget deficit, and enables permanent trade deficits:



At RCM, Louis Woodhill critiques Rep. Paul Ryan’s budget plan for providing lower growth than is required to recover from the recession.

From The Hoover Institution, Charles Wolf, Jr. explains why yuan revaluation is a bad idea.

The NYT profiles deficit hawk Peter Peterson, noting his early opposition to Reaganomics and his financing of bipartisan deficit advocacy:

Its most effective use of its founder’s fortune may be the millions of dollars in grants it has given over the years to think tanks like the Heritage Foundation and the Center for American Progress, run by John Podesta, Mr. Clinton’s former chief of staff. “Everyone I know in the ‘budget community’ is trying to get Peterson money,” said Stan Collender, a longtime budget expert at the consulting firm Qorvis Communications.

At The Daily Beast, Reagan budget director (and former Peter Peterson associate) David Stockman advocates shutting down the government.

On NRO, Mona Charen reviews Richard Brookhiser’s new documentary on Alexander Hamilton.

Wednesday items.

At Yahoo Finance, John Tamny debates Gary Shilling on inflation.

From Forbes, Rich Danker notes President Reagan’s unsuccessful effort to restore a gold-backed dollar.

On The Kudlow Report, Stephen Moore endorses entitlement cuts:



At Asia Times, David Goldman advocates a higher Fed funds rate.

On The Daily Reckoning, Charles Kadlec connects Egypt’s unrest to the dollar’s decline.

World Bank President (and sound money advocate) Robert Zoellick notes high food prices may push one billion people into hunger.

From the Institute for Humane Studies, Prof. Steve Horwitz refutes the claim that the poor are getting poorer:



At Daily Finance, Joseph Lazzaro makes the crucial points that exports are rising, but the trade deficit is also rising due to oil’s high price. Unfortunately, he goes on to argue the yuan should rise significantly which would likely lower the dollar, thereby raising oil even more.

From Heritage, Derek Scissors argues yuan convertability is more important than revaluation.

In The Pittsburgh-Tribune Review, Don Boudreaux explains different views of inflation, though he doesn’t use Robert Mundell’s formulation that inflation is a decline in the monetary standard.

On Capital Gains and Games, Bruce Bartlett cites a poll showing weak support for big spending cuts.

Weekend update.

At NRO, Larry Kudlow suggests the dollar’s decline is causing Egypt’s food riots and destabilizing the developing world.

From 1998, Jude Wanniski recounts how the 1970s weak collar caused revolutions in Iran and Iraq.

On The Kudlow Report, Don Luskin assesses the world inflation situation and how it will impact the U.S.:




At Asia Times, David Goldman recommends buying oil stocks.

On Fox Business News, David Malpass discusses Egypt.

Steve Forbes delivers a superb address at the Reagan Library, including a substantial discussion of the dollar and gold:



At Forbes, Nathan Lewis explains that gold-backed currency is the most stable and reliable.

The NY Sun editorializes on the recent decline in gold.

At Asia Times, David Goldman notes that U.S. exports to China are one of the economy’s few bright spots:



From AEI, John Makin examines the prospects of the yuan becoming a world currency.

The Asian Financial Forum releases a summary of Robert Mundell’s recent speech.

On Alhurra TV, Steve Forbes discusses how to create more jobs (the opening is in Arabic but the interview is in English):



In Forbes, Reuven Brenner reports on Federal Reserve bookkeeping.

From City Journal, Nicole Gelinas makes a strong argument for a 21st century Reaganomics.

The WSJ analyzes the Financial Crisis Inquiry Report:

The questions to which Americans need answers are: Why did the pursuit of riches lead to catastrophe in 2008, and why was the crisis concentrated in housing and the mortgage-securities markets?

Democrats on the commission mention the role of Federal Reserve monetary policy in creating a credit bubble, but they spend far more time arguing that the Fed should have prevented the consequences of this subsidy for financial products with heavier regulation of lending. But when have regulators ever in history had the wit or will to stop a credit-fueled financial mania? Read your Kindleberger, guys.

Also in The Journal, Stephen Moore recounts conservative disappointment at Mike Pence’s decision not to run for president.

Cato’s Dan Mitchell notes the Laffer Curve effect of tax changes in France.

Thursday round up.

At Forbes, Jerry Bowyer highlights China’s weaknesses.

On Cafe Hayek, Don Boudreaux rebuts China currency manipulation charges.

The XtraNormal bears argue China manipulates its currency which steals American jobs.



The WSJ clarifies that China has many problems and that a burst of Reaganite growth would restore American confidence.

China remains an underdeveloped country, its economy barely one-third the size of America's. Its leaders live in fear of peasant revolts, ethnic separatists, underground religious movements, political dissidents and the free flow of information. Its economy remains profoundly hobbled by corruption, inefficient state-owned enterprises and an immature banking system.

There is no genuine rule of law and its regulatory environment has become increasingly unpredictable for foreign investors and local entrepreneurs. It suffers from an aging population and environmental damage Americans wouldn't tolerate. Its greatest comparative advantage—cheap labor—is under strain from rising domestic wages and competition from places like Vietnam and Bangladesh.

Above all, China suffers from an absence of self-correcting mechanisms, beginning at the top with its authoritarian political system. And while it can trumpet achievements like a stealth fighter or bullet trains—some based on pilfered designs—it has a harder time adjusting to failure, much less admitting to it.

From Foreign Policy, Daniel W. Drezner explains that China isn’t beating the U.S.

On The Kudlow Report, Gov. Mitch Daniels (IN) shows sound policy instincts regarding China and pro-growth policies, but omits the dollar from his analysis:



At Conscience of a Liberal, Paul Krugman praises the Bush era’s dollar decline.

On his blog, Brad DeLong quotes Krugman citing Milton Friedman in favor of currency devaluation.

In The WSJ, Joseph Sternberg suggests China won’t "rebalance" toward consumption anytime soon.

China needs to reallocate capital and labor on a massive scale to orient itself toward producing goods and services that Chinese consumers want to consume. This will require major banking changes, especially improving access to credit for the small and medium-sized enterprises that make a modern consumption-driven economy tick. Both regulation and habit will get in the way.

The regulation involves interest rates: Government manages both deposit and lending rates in a way that guarantees banks a wide spread. This was intended to help banks earn themselves out of an earlier generation of nonperforming loans at the expense of households, which earn lower rates on savings deposits. And the policy could prove especially necessary if 2009's credit binge results in huge piles of bad debts.

On Lew Rockwell, "Norm" claims Bill Kristol’s recent support for monetary reform is “another neocon trick, like supply-side economics.”

Wednesday round up.

At Forbes, Econoclasts author Brian Domitrovic illustrates similarities between the 1970s Dow and today’s.

The WSJ editorializes on President of the Philadelphia Federal Reserve Charles Plosser’s recent speech in Chile:

"I believe we have come to expect too much from monetary policy," Mr. Plosser said, quoting similar comments by Milton Friedman in 1967, another era when we were told the Fed could produce prosperity by manipulating money creation. "Monetary policy can sometimes temporarily stimulate real economic activity in the short run," he added, and it has a role to play in preventing deflation or offsetting productivity shocks.

But central bankers cannot create jobs or retrain a work force, or even—brace yourself—"reverse the sharp decline in house prices when the economy has significantly over-invested in housing." Though Mr. Plosser didn't say this, we would argue that the Fed's current historically easy policy is intended precisely to reflate the housing and job markets. How's that been working out?

At CNBC, David Malpass suggests loose U.S. monetary policy is causing inflation in China:



From last week, Malpass examines China’s currency.

On NRO, the editors dismiss yuan manipulation charges.

From November, Taiwan’s Next Media Animation releases a surprisingly substantive “currency rap battle,” between Presidents Obama and Hu:



At The Atlantic, Uri Friedman explains why the yuan isn’t the main issue confronting U.S.-China relations.

The NY Sun editorializes in support of Virginia’s bill to study a gold-backed currency:

America is at a remarkable moment in respect of the dollar. Suddenly a wide range of thinkers are waking up to the catastrophe that would be represented by the loss of the dollar. A former chairman of the Federal Reserve, Alan Greenspan, presented himself at the Council on Foreign Relations to warn that fiat money always goes to gold. The president of the World Bank, Robert Zoellick wrote an important op-ed piece in the Financial Times, of all places, to suggest that there may be a role for gold after all. The New York Times brought in no less a figure than James Grant to argue that the time has come to bring back the classical gold standard. The Wall Street Journal editorial page has been running a stream of important pieces on monetary reform. This week a committee has been set up to draft for the 2012 presidential campaign a candidate, in the person of Congressman Michael Pence, who might stand on a gold plank. The Congress of the United States has just put Ron Paul at the head of the subcommittee that oversees the Federal Reserve. What a golden opportunity for Virginia, which gave us so many fathers of the Constitution, to take the lead in studying what role the states themselves might have in a return to sound money.

From Bloomberg, Art Laffer applauds the President’s recent pro-business slant.

Monday update.

In The WSJ, Stephen Moore and Richard Vedder argue higher taxes don’t lead to lower deficits.

Reuters reports supply-side guru Robert Mundell advising Gulf states to maintain their fixes to the dollar.

On The Kudlow Report, Larry and Steve Forbes discuss the role the weak dollar played in the mortgage crisis:




In The NYT, Greg Mankiw praises the Bowles-Simpson plan for eliminating tax expenditures and reducing tax rates.

On Forbes, Rich Karlgaard sees prices rising despite low core inflation statistics.

On The Huffington Post, Amanda Terkel reports on Warren Buffet’s demand-side analysis of not raising tax rates.

"I think that people at the high end, people like myself, should be paying a lot more in taxes. We have it better than we've ever had it," he told ABC's Christiane Amanpour in a clip played on "This Week" on Sunday.

When Amanpour pointed to critics' claims that the very wealthy need tax cuts to spur business and capitalism, Buffett replied, "The rich are always going to say that, you know, 'Just give us more money, and we'll go out and spend more, and then it will all trickle down to the rest of you.' But that has not worked the last 10 years, and I hope the American public is catching on."

In Business Week, Chris Farrell blames Ireland’s trouble on supply-side economics.

At The Economist, Will Wilkinson rebuts The NYT’s Nicholas Kristof on income inequality.

On The WSJ, Financial Crisis Inquiry Commission member Peter Wallison suggests government policy caused the mortgage and financial meltdown, but leaves out the weak dollar:




MarketWatch reports China is considering raising the yuan to stave off inflation.

On Youtube, Don Boudreaux provides an animated conversation US/China trade:

Tuesday round up.

What Would Kemp Do?

An important factoid: The President’s fiscal commission based its recent deficit report (p. 10) – and its alarming diagnosis of “fiscal cancer” – on CBO's budget analysis (p. 28), which, according to Louis Woodhill, assumes annual GDP growth of 2.16% for the next 75 years.

Yet, as Woodhill notes, average growth over the past 75 years was 3.73% per annum. If the U.S. grew at that rate going forward, CBO's more pessimistic budget scenario balances in 2052 with no spending cuts or tax increases.

This isn't to say we shouldn’t cut government waste and bloat. We should.

But, in the middle of painfully high unemployment, shouldn’t conservatives be ringing alarm bells mainly over slow long-run growth? Restoring rapid growth through the proven formula (sound money + lower tax rates) would help the jobless and improve the budget – a win/win – and would move the right beyond the zero-sum austerity debate.


Update: This item has been reworked for clarity.
----------------

At RCM, Joseph Calhoun argues the malaise is rooted in bad economic policy.

In The WSJ, likely presidential candidate U.S. Rep. Mike Pence (IN) proposes to repeal the Fed’s full employment mandate.

On The Kudlow Report, Pence explains his plan:




IBD notes that after tax rates were cut in 2003, the wealthy paid a higher percentage of taxes.

At The Washington Times, Richard Rahn suggests government caused the financial crisis, though he omits the falling dollar.

On Kudlow, David Goldman assesses the market’s decline:




On Charlie Rose, U.S. Rep. Paul Ryan (WI) repeatedly mentions sound money.

At the Peterson Institute, lead currency warrior C. Fred Bergsten insists China must revalue the yuan.

From YouTube, a viral video mocks the Fed’s QE2:

Tuesday round up.

At RCM, John Tamny criticizes Treasury Secretary Geithner’s plan to manipulate trade balances through continued dollar weakness.

In The WSJ, University of Chicago’s John H. Cochrane analyzes Geithner’s trade balance argument.

Since when is every trade surplus or deficit an "external imbalance" in need of correction? It makes sense for a country that has good investment prospects to import a lot of goods, run trade deficits, and borrow money. Years later, the country puts the resulting products on boats to pay the lenders back. The U.S. borrowed abroad to finance our railroads in the 19th century and ran surpluses when Europe was rebuilding after World War II. Were these "imbalances"?

Or consider a country (say, China) with a lot of middle-aged workers who need to save for retirement. It makes perfect sense for them to put stuff on boats and send it to a second country (say, the United States) whose people want to consume the goods. The people in the first country invest their earnings, say, by buying the bonds issued by the second country. And as they retire, they cash in the bonds and buy goods flowing the other way.

Do these and similar stories exactly account for current trade patterns? I don't know. But nobody else does, either. In particular, the army of economists in the basements of the International Monetary Fund (IMF) has no clue exactly how much each country should be saving, or where the best untapped global investment opportunities are around the world—including whether trade patterns are "normal" or "imbalanced."

On CNBC, Keynesian Stephen Roach lashes China currency bashers:




Cato’s Steve Hanke recounts the history of US efforts to destabilize China’s currency.

Investor’s Business Daily offers non-monetary ways to increase exports.

At NRO, Stephen Spruiell comments on Paul Krugman’s claim that lower revenue due to contraction, not abnormally high spending, accounts for the budget deficit:




On The Washington Times, Richard Rahn argues taxes already have been increased by $352 billion.

At Alhambra Investments, Joseph Y. Calhoun, III assesses the economy.

On The Kudlow Report, Steve Forbes suggests the budget deficit can be reduced with strong growth:




Reprinted from First Things, David Goldman and Reuven Brenner analyze the Keynesian roots of the current crisis. (H/T: Dick Fox at Supply-Side Forum.)

Monday update.

On Forbes, John Tamny explains rising commodity prices indicate a falling dollar, not economic strength.

The WSJ critiques the Treasury’s trade balancing proposal as a recipe for further decline.

In any event, how do the world's would-be central planners know what is the ideal trade surplus or deficit? Many factors determine the competitiveness of a country's exports, including productivity, wage flexibility and more. Should nations like Germany that have run prudent fiscal policies, reformed their labor markets and raised productivity be chastised for exporting more goods than they import? Should countries like Australia be penalized for selling natural resources to a developing China that needs those imports to fuel growth? Should China be punished for exporting cheap goods to willing U.S. consumers?...

There was a time when U.S. officials understood that focusing so much attention on trade deficits and surpluses was counterproductive. In 1976, an advisory committee to the Treasury that studied the international economic accounts concluded: "The words 'surplus' and 'deficit' should be avoided insofar as possible . . . These words are
frequently taken to mean that the developments are 'good' or 'bad' respectively. Since that interpretation is often incorrect, the terms may be widely misunderstood and used in lieu of analysis." The world could use such wisdom today.

On The Kudlow Report, Art Laffer worries about the dollar’s future:



On The Daily Caller, Jared Whitley (a friend) argues the Tea Party should focus on growth, including a sound dollar, rather than budget cuts.

At The NYT, former Obama advisor Christina Romer recommends against austerity.

In The WSJ, Keynesian (and cash for clunkers advocate) Alan Blinder advocates short-term rebates and credits, plus increased government spending.

From July, Alan Reynolds analyzes the flaws in Blinder’s model.

Also on Kudlow, Dan Mitchell debates the impact of lower tax rates on the budget deficit:



In The LA Times, Nicole Gelinas suggests letting bad banks fail is necessary for recovery.

On NRO, Reihan Salam recommends streamlining government to reduce debt, but makes no reference to increasing the rate of growth.

Friday round up.

On Asia Times, David Goldman critiques Sec. Geithner’s call to target national trade balances.

Robert Mundell showed in his Nobel-Prize winning work that trade deficits arise from anexcess or deficiency of savings in a national economy; if the Chinese want to save 50% of GDP, they can only do so by exporting goods, because there aren’t sufficient outlets for savings inside China. The trade deficit is the symptom, not the cause, of a complex of economic problems. To target a trade deficit is lunatic. Some countries with very young populations and huge investment opportunities should have enormous trade deficits; some countries with aging populations and high savings rate should have enormous trade surpluses.

At Forbes, Shikha Dalmia scolds Republican for joining Democratic China bashing:

But the idea that selling abroad creates jobs at home and buying abroad destroys jobs at home is an old mercantilist fallacy that Adam Smith handily refuted more than 200 years ago. Back then it at least had intuitive plausibility, but today it is obviously false given that the manufacturing chain spans the whole globe. Indeed, under the intricate global division of labor that currently exists, the whole idea of “Made in China” is largely a bureaucratic fiction.

On The Kudlow Report, Larry debates Sec. Geithner’s recent strong dollar sentiments:



At his blog, Scott Grannis argues it is China, not the U.S., that gets the short end of the trade stick.

They sell us mountains of cheap goods, then turn around and invest most of the proceeds (equivalent to our trade deficit with China) in U.S. Treasury securities. We get the goods, and we get to keep the money. Then we devalue the dollar, and they lose on their investment. Why we would want them to stop doing this is beyond me, though if I were a Chinese citizen, I would be furious with my government for directing such massive quantities of my country's export earnings to Treasuries. The central bank of China has no need to further increase its already-massive reserves; instead, the government should be relaxing capital constraints, allowing Chinese citizens more freedom to save and invest abroad in the types of vehicles with which they feel most comfortable. China's workforce is aging daily, and like Japan a few decades ago, China's economy cannot accommodate all the savings of the Chinese people—they are essentially forced to save overseas.

Contrary to what you read in the press—which mistakenly believes that our large trade deficit with China is something we need to worry about—China is the one that needs to worry, not us.

At Green Faucet, Brad Zigler summarizes the decline of world currencies versus gold.

On The Freeman, Christopher Lingle debunks the notion of an export multiplier.

At Carpe Diem, Mark J. Perry explains the factors behind income inequality.



In an editorial, The LA Times suggests austerity is the only alternative to Keynesian stimulus.

On the Peter Peterson-funded Fiscal Times, Bruce Bartlett defends Indiana Gov. Mitch Daniels support for a VAT tax.

Weekend round up.

In a must-read WSJ piece, Judy Shelton interviews supply-side founder Robert Mundell. The Atlas Sound Money Project features the full text:

“Are you thinking,” I venture, “that maybe it’s time to start figuring out the design for a new international monetary order? Should the U.S. offer new proposals regarding exchange rates and monetary policy?”

Mr. Mundell, who is Canadian, looks troubled. “I don’t think the U.S. has any ideas, they don’t have strong leadership on the international economic side,” he replies. “There hasn’t been anyone in the administration for a long time who really knows much about the international monetary system.”…

“The U.S. berates China for its exchange rate policy, which Washington doesn’t like,” Mr. Mundell says, noting that discriminatory tariffs against China might not be legal under the treaty provisions of the World Trade Organization. “But one-sided pressure on China to change its exchange rate is misplaced.”

Shaking his head, Mr. Mundell asserts: “The issue should not be treated as a bilateral dispute between the U.S. and China. It’s a multilateral issue because the U.S. deficit itself is a multilateral issue that is connected with the international role of the dollar.”

He goes on to explain that the dollar bloc includes China and other Asian countries—except Japan—but that the euro now constitutes the rest of the world.

“The euro today is the counter-dollar,” he says. “The most important initiative you could take to improve the world economy would be to stabilize the dollar-euro rate.”

The WSJ editorializes on Fed Chairman Bernanke’s lack of attention to the falling dollar.

We were more struck by what Mr. Bernanke didn't say. In a nearly 4,000-word speech about inflation, the Fed chief never once mentioned the value of the dollar. He never mentioned exchange rates, despite the turmoil in world currency markets as the dollar has fallen in anticipation of further Fed easing. He never mentioned rising commodity prices or soaring gold, and his only reference to the recent increase in the price of oil was by way of dismissing it in the context of overall low inflation.

On Fox, Steve Forbes suggests the mortgage market has been nationalized:



At Bloomberg TV, David Malpass calls the U.S. a currency manipulator and says the current administration is following GW Bush’s weak dollar policy. Interestingly, he suggests the weak dollar since 2004 has driven investment capital overseas, contributing to a rising trade deficit, the opposite of the mainstream view. He also predicts the Bush tax cuts will not be extended.

Seeking Alpha summarizes a recent presentation on the economy by Dr. Victor Canto.

On CNN, Stephen Moore debates economic policy:



Foreign Policy analyzes the power struggle among China’s rulers.

Cato’s Dan Mitchell suggests Calvin Coolidge was the best President of the last 100 years.

Friday items.

On Supply-Side Economics Today, Econoclasts author and historian Brian Domitrovic explains that sound money would limit Wall Street excesses and boost the productive economy.

At The Atlantic, James Fallows reports the Treasury delayed its report on China’s currency status.

CNBC covers Ben Bernanke’s statement on the state of the economy:



At RCM, Michael Pento puzzles over low bond rates despite a falling dollar.

Bloomberg’s Caroline Baum worries about Fed easing.

On The Kudlow Report, David Goldman discusses how to play the falling dollar:



Heritage’s James Sherk argues technology explains the drop in manufacturing jobs.

Insider Online suggests fiscal policy uncertainty is keeping business from hiring.

Investor’s Business Daily compares pro-growth policies in Texas vs. California.

Thursday update.

On Bloomberg TV, Keynesian C. Fred Bergsten of the Peterson Institute for International Economics, calls China a currency manipulator for keeping the yuan stable, and advocates the U.S. buy Chinese currency.

At Café Hayek, Don Boudreaux explains that Chinese trade doesn’t diminish good jobs in the U.S.

On The Kudlow Report, Larry discusses rising oil and other commodities:



The WSJ’s David Wessell reports on a new paper suggesting low Fed interest rates caused the housing bubble.

On Asia Times, David Goldman suggests we have symptoms of deflation and inflation because:

When the Fed prints money, investors flee to other currencies, and foreign central banks intervene and buy dollars which they invest in Treasuries. It has precisely the same effect as the Fed’s own buying of bonds — yields fall. This increases the risk of future inflation so the market buys hedges against it (and you should, too).

The WSJ editorial board warns Democrats and Republicans against scapegoating China.

On CNBC, Paul Krugman calls China “the bad guy” in the currency war, and advocates for trillions in additional quantitative easing:



Reuters reports increased unemployment and inflation.

At Conscience of a Liberal, Krugman makes a convincing argument that the scariest part of debt-to-GDP analysis is the weak GDP:


At Forbes, Rich Karlgaard applauds Greg Mankiw’s recent tax analysis.

On The Kudlow Report, Stephen Moore analyzes the President’s NYT contrition:



Seeker Blog discusses Douglas Irwin’s recent paper, “Did France Cause the Great Depression?”

From 1997, Jude Wanniski argues the Great Depression was solely a fiscal crisis.

From June, John Tamny suggests there was a deflationary component in the 1920s.