Ryan Avent doesn't believe 2.8 percent unemployment is a reasonable possibility

Ryan Avent on the assumptions underlying the Ryan plan:


http://www.economist.com/blogs/freeexchange/2011/04/facts_and_figures

A couple of other points: Ryan seems to think that the two basic problems facing the country are: (1) too many defined benefits and (2) too much equality.

Dalton Conley Talks about Intergenerational Wealth--and it is not pretty

Dalton gave a very nice talk at USC on Friday, presenting his Center for American Progress paper 

Wealth Mobility and Volatility in Black and White.  The CAP page on the paper summarizes the findings:

• What family an individual comes from ƒƒexplains about three-quarters of where they end up in the wealth distribution as adults. For African Americans, however, the impact of family background is substantially lower, at 37 percent.
• Individuals are more likely to mainƒƒtain wealth than to attain wealth, or more precisely, low-wealth children are unlikely to become high-wealth adults, while high-wealth children are very likely to be high-wealth adults. Looking at previous years’ data, less than 10 percent of children who grew up in families in the bottom wealth quartile, which had a maximal cut off of about $8,000 in 1984, reached high wealth levels by adulthood between 1999 and 2003 (when the top group’s minimal value was $82,501and the median was over $189,000). And over 55 percent of children who grew up in families in the top wealth quartile—over $155,000 of net worth back in 1984—held on to their high wealth levels by adulthood.
• The strongest predictor of an adult’s ƒƒrelative wealth status is his or her income, which in turn is highly predicated on his or her parents’ income and wealth.
• Wealthy white children are much more ƒƒlikely to become wealthy adults than wealthy African-American children: Over 55 percent of all white children raised by parents in the top wealth quartile hold onto the top wealth position as adults. This is contrasted to only the 37 percent of African-American children raised by parents in the top wealth quartile who hold onto the top wealth position as adults.

Soon-take Chang Describes South Korea's Countercyclical Housing Finance Policy

His paper is very interesting.  Section 3 begins:

Macroeconomic instability greatly affected the financial crisis in Korea at the end of 1997. The need for macroprudential supervision in Korea was highlighted by the bursting of the credit card bubble in 2003.

During the credit card lending boom, the supervisory authority did not respond adequately to the growth of household delinquencies stemming from the reckless behavior of credit card issuers.

The authority was not sensitive to systemic distress originating from households because its prudential oversight was primarily focused on the soundness of individual financial institutions (Lee, 2006). This case underlined the importance of placing greater emphasis on detecting early warning signs before the build-up of excessive imbalances continued for too long (Kang and Ma, 2009).

After the credit card bubble burst, there was a new, widespread appreciation of macroprudential policy. Mortgage loans had increased sharply since 2000, which undermined the stability of the overall housing market. The supervisory authority has taken steps to prevent overheating in mortgage lending and to minimize the risk of loan default.

First, the supervisory authority raised the risk weighting for mortgage loans. The authority also raised the minimum loan loss reserve ratios for banks’ household and corporate loans that were classified as normal and precautionary in November 2002 and in December 2006.

Second, in 2002, the authority started to reduce the maximum LTV ratio for mortgage loans, from approximately 75 percent to 40 percent in the Seoul metropolitan area.

The authority imposed additional measures, such as a ceiling of 40 percent on the DTI ratio for certain types of borrowers, as well as other restrictions on granting mortgage loans and maturity extensions on existing mortgage loans for properties in the Seoul metropolitan area. These various restrictions on mortgage lending were imposed on both banks and non-banking financial institutions.

Note that Korea's loan terms were conservative by OECD standards even before the tightening.   But given how well Korea's economy has survived the downturn, they may be onto something.

From The New Yorker: Wisconsin: The Cronon Affair

Wisconsin: The Cronon Affair

I was especially taken with this:

Second, the Republicans seem remarkably fragile. A professor writing a blog post gives them the shivers. It’s a good thing they chose politics, and not the kind of career where the going can really get rough. Professors, for example, teach their hearts out to surly adolescents who call them boring in course evaluations and write their hearts out for colleagues who trash their books in snarky reviews. These Wisconsin Republicans may never have survived ordeals like that. Happily, Cronon has been toughened by decades of academic life. He’ll be blogging—and teaching and writing—long after Wisconsin voters have sent these Republicans back to obscurity.

There are days when I wonder if tenure is an anachronism. The Cronon affair strongly suggests to me that it is not.

Shani Hilton on Gentrification in DC

Worth reading....

Confessions of a Black D.C. Gentrifier

The Census estimate for the US for 2009 was less than the Count for 2010

The estimate, at 307,006,550, was .6 percent less than the count of 308,745,538.  Yet for the ten largest cities, the estimate was 4 percent higher than the count.  Again, it would be nice no know whether cities were overestimated in 2009 or undercounted in 2010. 

To finish the previous post's thought.

The 2009 population estimate for Detroit was 821,792.  The 2010 count was 713,777.