Saturday, October 16, 2010

Now is the best time for national capital investment

Right now is the best time in decades for the government to engage in long-term capital investment. Investments in education, transportation, communication, and research & development would strengthen the economy in both the short run and the long run. Furthermore, the government's cost of borrowing is the cheapest in my lifetime.

Richard Voith argues the point in The Washington Post.

Friday, October 8, 2010

Job market: Mixed results for September 2010

The unemployment rate, at 9.6%, remained unchanged in September. Although it is below its late 2009 peak, it has spent almost all of 2010 (except April) in a range of 9.5-9.7%.

Payrolls continued to get worse in September. Ironically, businesses are actually increasing workers. It is governments that are losing workers. John Maynard Keynes must be rolling over in his grave.

On the bright side, aggregate weekly hours worked is increasing. This suggests that underemployment is declining.

Also on the bright side, the mean duration of unemployment has continued to decline after reaching its all-time peak in June 2010.