The Economist (June 22)
Already “one in five Americans calls Texas or California home.” The behemoths are now “the biggest, brashest, most important states in the union, each equally convinced that it is the future.” But their vision is “heading in opposite directions, creating an experiment that reveals whether America works better as a low-tax, low-regulation place” or a “high-tax, highly regulated one.” Given Washington dysfunction, “the results will determine what sort of country America becomes almost as much as the victor of the next presidential election will.”
Tags: Biggest, Brashest, California, Dysfunction, Election, Experiment, Future, Regulation, Tax, Texas, U.S., Washington
Financial Times (March 22)
Many hope that negative interest rates will “encourage banks to lend more plentifully and cheaply and help support economic recovery.” This might instead prove “a dangerous experiment with diminishing positive impact.” The optimistic forecasts overlook “how financial intermediaries may actually respond.” Negative rates “erode banks’ margins. They give lenders an incentive to shrink, not grow. They encourage banks to seek out opportunities overseas rather than in their home markets. They also risk disruptions to bank funding. All go against the grain of the central banks’ desire to ease credit conditions and support financial stability.”
Tags: Banks, Credit, Dangerous, Diminishing positive impact, Economic recovery, Experiment, Financial stability, Intermediaries, Lending, Margins, Negative interest rates, Overseas
Washington Post (June 6)
“Vying for the title of the United States’ most progressive city, Seattle this week decided to raise its minimum wage to $15 an hour.” Amidst the applause and the doomsayers, however, lies the truth. Nobody knows how this experiment will end. “Despite literally hundreds of studies focusing on the minimum wage, top economists are still uncertain about the consequences of raising it.”
Tags: Consequences, Doomsayers, Economists, Experiment, Minimum wage, Progressive, Seattle, Studies, U.S., Uncertain
