The use of emergency rooms for routine care fell, as did hospital admissions for treating preventable conditions, and the proportion of uninsured among hospital inpatients (by 36%), while there was no increase in the growth of hospital costs. From the NBER Digest article summarizing NBER working paper 16012 [ungated version] by Jonathan T. Kolstad and Amanda E. Kowalski:
QE2, News, and Differential Impacts in Asset Markets
Typically, economists assume that news, defined as information that induces revisions to expectations of the future value of relevant variables, should affect asset prices simultaneously, and in a consistent manner. That’s why today’s announcement of QE2 has somewhat surprising effects, if one is to believe that QE2 had already been priced in [0].
QE2: Been there, done that
The Federal Open Market Committee announced today that:
the Committee decided today to expand its holdings of securities. The Committee will maintain its existing policy of reinvesting principal payments from its securities holdings. In addition, the Committee intends to purchase a further $600 billion of longer-term Treasury securities by the end of the second quarter of 2011, a pace of about $75 billion per month.
Election spin
Arnold Kling notes that exit polls show that 52% of those who voted have an unfavorable opinion of the Democratic Party and 53% have an unfavorable opinion of the Republican Party. Arnold comes up with this conclusion:
People with an unfavorable view of Democrats went 88-10 for Republicans, but people with an unfavorable view of Republicans only went 76-22 Democrat.
That was the difference in the election. The “unfavorables” on net broke Republican. The way I would spin it is that there is a large block of voters who are negative on both parties, the Republicans captured a larger share of that block, and that block swung the election.
Detachment from Reality and Innumeracy as Impediments to Rational Discourse
Tax cut version
Links for 2010-10-31
Some quick links on the flash crash, China’s rare earth elements monopoly, Larry Summers, and economics at UCSD.
The Chamber of Commerce Is the International Cosmopolitan Elite
Not that there’s anything wrong with that!
I have been pondering two seemingly separate issues — the first, what constitutes an “elite”. David Brooks says it’s bobos; Charles Murray says it’s those who “…spend school with people who are mostly just like them — which might not be so bad, except that so many of them have been ensconced in affluent suburbs from birth and have never been outside the bubble of privilege. Few of them grew up in the small cities, towns or rural areas where more than a third of all Americans still live.” Personally, I always thought American elites were football players and the folks highlighted on Entertainment Tonight, given the amount of attention devoted to those two groups. (See other recent commentary here) The second, as a social scientist, what interests should one expect the U.S. Chamber of Commerce to be lobbying for [1] (since we do not have direct observation on the funding of the group, we need to infer the interests). I have come to a single answer that partly addresses both of these two questions:
Another disappointing GDP report
The U.S. economy managed to keep growing in the third quarter, but well below what’s needed for a normal economic recovery.
A Post-Mortem on the Fall and Rise in World Trade
And Implications for US Exports
Nearly two years ago, I noted the collapse in world trade, and observed that various explanations for the decline ranged from the drying up of trade financing, to amplification due to vertical specialization, to the composition effect (the fact that durables are over-represented in trade relative to GDP).
Negative real interest rates
What message should we take from negative real interest rates?