April 5, 2012
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On July 19, Michigan Gov. Rick Snyder authorized the Chapter 9 bankruptcy requested by Emergency Manager Kevyn Orr for the city of Detroit. Specifically, the city was unable to make a scheduled payment of $39.7 million for pensions and sought federal court protection in a bankruptcy proceeding.
PIMCO Managing Director William Gross offers his opinion that college degrees might be overvalued and it is a valid point. Now that might be odd since I’m an educator, but let me explain. The global marketplace has radically changed over the last decade and it is placing more value on math and science, rather than the liberal arts. Therefore, the value of a college degree varies based on area of discipline and academic rigor.
When assessing Federal Reserve Chairman’s Ben Bernanke’s performance, he deserves great credit for his role in preventing a depression. While controversial, Bernanke’s aggressive moves to provide liquidity to an ailing US and global banking system helped avert an even bigger disaster. However, there are significant risks in carrying the same policy for multiple years, as expressed by noted monetarist, Dr. John Taylor. Dr. Taylor’s editorial from the Hoover Foundation highlights what those risks are.
When reviewing the economic prospects for the Albany area in 2013, they can be described as stable, but highly susceptible to market shocks. Referring to last year, despite seeing a Georgia economy finally growing at a faster rate than their regional counterparts, our area lagged. Despite Albany’s seasonally adjusted unemployment rate falling from 10.1 percent to 9.5 percent over the last year, there was no net job growth in 2012.
Thankfully, common sense prevailed and legislation passed averting the fiscal cliff. Not passing this deal would have caused unnecessary financial market turmoil and loss of wealth. It would have shaken consumer and investor confidence, even if Congress would have been able to craft a deal quickly in 2013. With that being said, this piece of legislation will hamper future economic growth as uncertainty continues as we prepare for another painful, bruising battle in February when negotiations take place for raising the debt ceiling.
When one says that a falling unemployment rate is actually not good, the natural inclination is to say, "Huh?" Should we not look at a declining unemployment rate as a good sign, especially when most experts did not expect such a drop?
Borrowing from a recent editorial by Caroline Baum of Bloomberg, four figures will be used to explain why U.S. debt matters.
The answer to that question will probably determine the fate of the Patient Protection and Affordable Care Act, also known as ObamaCare. Recently, the U.S. Supreme Court listened to oral arguments from Solicitor General Donald Verilli and plaintiffs on health care reform legislation. The core argument centers on the individual mandate under the Affordable Care Act where its demise will eventually doom Obama’s signature piece of legislation.