Economy News
The Daily Signal reports on economy news with analysis and commentary on growth, recession risks, employment, and financial trends.
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- Opinion
The Fed Shouldn’t Pay Attention to Short-Term Changes in Stock Market
Back in grad school (not all that long ago), we pondered whether a central bank should target equity (or other asset) prices to conduct monetary policy. In theory, as the value of consumers’ stock portfolios rises, they will spend more, because they are wealthier. It turned out, though, that the empirical link among monetary policy,…Norbert Michel -
- Opinion
The Link Between Political and Economic Freedom
More than 50 years ago, Milton Friedman’s seminal work “Capitalism and Freedom” reminded Americans of the founding principles that made us greatest nation on Earth (economic and political freedom, individualism, and the rule of law). America’s greatness lies in its people’s faith in these ideals and the constitution that embodies them. Central to Friedman’s vision—and…Julius Kairey -
- Opinion
No, the Federal Reserve Cannot Set Interest Rates
As the Federal Reserve summer symposium in Jackson Hole, Wyo. begins, I thought I’d set the record straight. The Federal Reserve cannot just set interest rates. I’m not exactly sure how it happened, but there seems to be widespread acceptance of this idea (that the Federal Reserve can simply make interest rates whatever they want them…Norbert Michel -
- Opinion
How a Higher Minimum Wage Could Lead to Automated Restaurants
Want to know what the future of the restaurant industry looks like? It could come in the form of a San Francisco fast food restaurant named Eatsa. Eatsa is a quinoa (a South American grain dish) eatery that is preparing to automate most of its workforce. The Ferenstein Wire got a sneak peak at the restaurant,…Greg Ferenstein -
- Opinion
Obama Called Conservatives Hypocrites on Solar Energy and Free Markets. Here’s What He Got Wrong.
President Obama is having a hard time with the definition of free market. The most recent example came from his remarks at the National Clean Energy Summit, an event hosted by Senate Minority Leader Harry Reid, D-Nev., to promote solar power. Obama told a crowd in Las Vegas that solar and renewables now make economic sense and…Nicolas Loris -
- Opinion
Three Things Americans Should Know About the Stock Market Turmoil
It’s too early to know if the stock market drop is just one of the periodic corrections by which the market reallocates capital to more profitable uses, or the start of a more dramatic contraction signaling a long-term decline. In any case, if the roller coaster ride of the last few days goes on much…Terry Miller -
- Opinion
How US Should Respond to China’s Stock Market Collapse
To give perspective, China is the world’s second largest economy, as well as the second largest importer. It is the largest trading nation for 75 countries and is by far the largest importer of commodities in the world. Over the past seven years, China has accounted for an incredible one-third of global growth. But its…William T. Wilson -
- News
China’s Economic Woes Jolt Global Stock Markets
U.S. stock markets plummeted Monday, furthering a global market decline that has eliminated nearly $10 trillion from international shares as concerns grow over China’s economic health. The Dow Jones industrial average plunged more than 1,000 points soon after trading began, continuing losses from last week that marked the worst for U.S. stocks in four years….Natalie Johnson -
- Opinion
Labor Department Should Withdraw Proposed Conflict of Interest Rule
The Department of Labor recently proposed seven rules imposing new obligations on firms selling securities to retirement plans and individual retirement account (IRA) investors. If implemented, these rules will harm the investing public, small businesses, the securities industry, and the overall economy. Among other things, the rules would substantially broaden the class of persons deemed…David Allen -
- Opinion
What’s Driving the Rapid Growth of Welfare Spending
The fastest growing category in many state budgets? It’s not education. It’s not infrastructure. It’s welfare spending. Costing more than $1 trillion per year, the nation’s current welfare system is enormous, but much of this spending is counterproductive. Today’s welfare programs undermine work and marriage, leading to a broadening pattern of intergenerational dependence and self-defeating…Paul Winfree -
- Opinion
CBO Needs to Ask “Where Will the Money Come From” When Dynamically Scoring Spending
When a family want to spend more money on a house, a car, education, or anything else they want to buy, the first question they ask themselves is “Where will the money come from?” When Congress asks the Congressional Budget Office (CBO) to score how spending increases will affect the economy, the CBO does not…Curtis Dubay -
- News
Bipartisan Group of Lawmakers Asks Treasury Department to Return $29,500 Taken From Innocent Dairy Farmers
A bipartisan group of lawmakers on the House Ways and Means Oversight Subcommittee is coming together to ask the Treasury Department to return nearly $30,000 it seized from Maryland dairy farmers in 2012. The letter, sent August 11 to Treasury Secretary Jack Lew, calls on the agency to return $29,500 the Internal Revenue Service seized…Melissa Quinn -
- News
Why Carly Fiorina Has Yet to Tackle Entitlement Reform
Former Hewlett-Packard CEO Carly Fiorina says she won’t tackle entitlement reform until the federal government can get its act together. “The government has to get its house in order before it goes to the American people and takes something away from them,” Fiorina told The Daily Signal in an interview at the annual RedState Gathering event…David Brody -
- News
Chris Christie: Export-Import Bank Is Corporate Welfare ‘We Can’t Afford’
New Jersey Gov. Chris Christie says the Export-Import Bank should be finally laid to rest. “I believe it’s time for it to go,” Christie explained to The Daily Signal at the recent RedState Gathering in Atlanta. “My view is that it is the type of corporate welfare and subsidies that we can’t afford and that we’re…David Brody -
- News
How a Case About Headstones Could Send Economic Liberty Before the Supreme Court
Dennis Flynn’s ties to the Roman Catholic Archdiocese of Newark run deep: he’s been a parishioner there since he was 3 years old, he and his wife were married there, their children were wed in the parish and their grandchildren have all been baptized in the archdiocese’s churches. Flynn’s mother and father, as well as…Melissa Quinn -
- Opinion
What’s Wrong With New Study Claiming Huge Minimum Wage Hike Would Barely Raise Fast Food Prices
If something seems too good to be true, it probably is. Unfortunately, many journalists did not remember that when covering a new report claiming that $15-an-hour wages would raise fast food prices only 4 percent. A closer look shows that the study underlying the report had major methodological errors. More serious analysis shows that $15-an-hour…James Sherk -
- Opinion
The June Jobs Report Shows the Recovery Remains Weak
On the surface, recent jobs numbers represent solid economic growth, yet polls show that Americans continue to worry about economic conditions. Further analysis helps explain this disconnect. While the headline jobs numbers are strong, many other economic indicators have not fully recovered. The Bureau of Labor Statistics report showed that employers added 215,000 jobs while…James Sherk -
- Opinion
Why The Chinese Stock Market Continues to Unravel
As the Chinese stock market unravels, liberal economists are eating their words on the supposed benefits of heavy government intervention in the financial sector. On Monday, the Shanghai stock index declined by 8.5 percent, the largest single-day drop in 8 years. Before this point, the government had already taken extraordinary steps to further preserve the…Henry Dickman -
- Opinion
Unions Demand Special Treatment After Minimum Wage Hike They Backed Goes Into Effect
The Los Angeles city council will vote this week on exempting collectively bargained wages from its new $15 an hour minimum wage law. That’s correct – if unions get their way, only unionized employers will be able pay their employees less than $15 an hour. Over the past year, “Fight for 15” has swept the…James Sherk -
- News
Ohio Lawmakers Push to Drug-Test Welfare Recipients
Ohio lawmakers are expected to formally introduce legislation Wednesday that will require welfare recipients to pass a drug test before receiving benefits. Republican State Representatives Tim Schaffer and Rob Maag are sponsoring the bill that, if passed, will implement a two-year pilot program in three counties within the Ohio Works First (OWF) cash assistance program….Chelsea Scism