News New Mexico: Economics

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The Keynesian School of Economics Leads to Violence

From the blog Points and Figures - by Jeff Carter - We are seeing the end game played out over and over in different cultures all over the world. There is one thread of similarity. All of them have practiced Keynesian economics for decades. The belief that more government spending and bigger government to solve society ills has degenerated into a stagnant economy with no growth and in many parts of the world it’s unsafe to walk down the street. Riots have taken place in “civilized” first world countries. Spain, Italy, Greece, even France and England. Unemployment in some of them is over 20%, and for younger people that have never been hired it can be significantly higher. Even in America, we have seen mini-riots with the Occupy Wall Street crowd and in places like Wisconsin and Ohio that have tried to undo years of bad economic policy. The problem is that eventually the socialist/Keynesian school runs out of other people’s money to spend. They can’t raise taxes high enough, and the market forces them to pay ever higher interest rates to access public markets. When governments increase spending, businesses cut back. The net present value tables always catch up to them. At this point in the cycle, they generally have created a situation where there are haves and have nots. Forced to cut spending on the people that receive a government check, those people riot. In Rome, Italy the streets are becoming unsafe. Read more

Economist Sees Slow N.M. Growth in 2012

From krqe.com -The body language of some of the business leaders gathered at New Mexico's 7th Annual Economic Outlook Conference looked like they were expecting an economic apocalypse in 2012.
But Lee Reynis, director of the University of New Mexico Bureau of Business and Economic Research, said there's plenty to like in the year ahead even if it isn't necessarily exciting. "I see slow growth as probably the best that we're going to see," said Reynis. "I don't think that's necessarily bad." Reynis pointed to solid growth in the state's mining and gas industries as a big positive sign adding she expects tourism to keep expanding in New Mexico. More News New Mexico

Should NM create its own state bank, like they have in North Dakota?

From Capitol Report New Mexico.com - On this site, we’ve written how Santa Fe should be a little bit more like Bismarck. Huh? While Santa Fe is the capital of New Mexico, Bismarck in the capital of North Dakota, the state that’s navigated itself through the economic downturn better than any other. In fact, North Dakota has the country’s lowest unemployment rate and in 2010 had an actual budget surplus of $700 million. Now, one of the members of Roundhouse’s Democratic contingent is calling for establishing a state development bank here in New Mexico — just like they have in North Dakota. Rep. Brian Egolf (D-Santa Fe) says creating a “New Mexico State Bank” to help out small businesses will be ”a win-win-win” for small businesses, local banks and the state’s bottom line. “It won’t cost the state a penny,” Egolf says, “and we’re going to make money on this from start to finish.” Here’s how it would work:
The State Investment Council (SIC) has one of the largest permanent funds of any state in the country. At last calcuation, the balance is roughly $14 billion. Egolf wants to see $100 million of the permanent fund set aside to create a state development bank aimed at helping small business owners complete loan agreements so they can expand their businesseses. Read more

Fitch Affirms NMSU Revs at 'AA'

From marketwatch.com -Fitch Ratings has affirmed its 'AA' rating on approximately $143,420,000 of revenue bonds and revenue and improvement bonds issued by the Regents of New Mexico State University (NMSU, or the university). The Rating Outlook is Stable. More News New Mexico

Federal Funds to Build More Homes in Southern N.M.

From publicbroadcasting.net -USDA Rural Development State Director Terry Brunner traveled to Berino, New Mexico Tuesday to present over $700,000 in certificates of obligation to Tierra Del Sol Housing Corporation, Inc (TDS). The funding will be used to administer the construction of 36 new homes in Berino, New Mexico. TDS is also receiving additional funding for the repair and upgrading of five homes owned by the elderly. The third award is a loan to provide business opportunities in the southern part of the state. More News New Mexico

Obama: Will Veto Payroll Tax Cut Extension, Jobs Created by Keystone XL Pipeline

Washington Times - President Obama on Tuesday said he will veto House Republicans’ payroll tax extension unless the GOP ditches spending cuts and instead pairs the tax cut with a tax increase on the wealthy. The threat, communicated by the White House in an official statement of policy, sets up a bruising year-end showdown that could even risk another government shutdown, since Democrats have signaled they won’t sign off on a massive spending bill to keep the government open unless the GOP agrees to their demands on the payroll tax cut.

House Republicans are still pushing ahead with a planned vote later Tuesday on their package, which would extend this year’s payroll tax cut into 2012, but couples it with a provision that would force the administration to make a final decision on the Keystone XL pipeline. The administration, caught between environmentalists who oppose the pipeline and labor unions who support it, has tried to put off a final decision until after the election. But the White House, in its veto threat, said nothing about the pipeline, instead attacking the GOP’s use of spending cuts instead of tax increases to offset the Social Security revenue lost from the payroll tax cut. Read the full story here: News New Mexico

N.M Rated Among Worst in Nation in Child Homelessness

From washingtonexaminer.com -A new report by an advocacy group says the problem of homeless children in America is growing rapidly, with one in 45 children experiencing homelessness in a year. The study released Tuesday by the National Center on Family Homelessness in Needham, Mass. The last 10 were Georgia, Florida, Nevada, Louisiana, New Mexico, California, Arizona, Arkansas, Mississippi and Alabama. The study found those states have more families living close to the poverty line, with one-fourth or more of their families paying more than 50 percent of their income for rent. Many of the states fell short on planning to deal with the problem of homeless children and lacked programs to provide affordable housing. More News New Mexico

Former Green Job Czar Van Jones Calls For Occupiers to Blockade All Ports

Van Jones

Pulaski note: This was Van Jones' tweet and he linked to the article below as well. "It's the 99's turn, again. Post-encampment phase begins Dec 12th. RT @occupybot: Occupy to blockade major ports".
From weaselzippers.us -Occupy movements plan to shut down major ports along the U.S. West Coast and Canada's Pacific seaboard in a day of action next month, they said Wednesday. In an announcement hours after a two-month-old anti-Wall Street protest camp was evicted in Los Angeles, they said they plan to strike back against the "nationally co-ordinated attack on the Occupy movement." More News New Mexico

NM's Permanent Funds Decline over $1B

From therepublic.com -New Mexico's permanent funds dropped in value by more than $1 billion during the past quarter because of a downturn in global financial markets. The latest report to the State Investment Council shows the Land Grant Permanent Fund had assets valued at $9.5 billion at the end of September, down more than a $1 billion from the previous quarter. More News New Mexico

Puerto Rico Benefited the Most From $1B Homeowners' Loan Program

From usatoday.com -Almost half the homeowners aided by the Emergency Homeowners' Loan Program are in Pennsylvania, Maryland and Connecticut, based on preliminary figures from the Department of Housing and Urban Development. As previously reported, the program closed to applicants on Sept. 30 with more than half of its $1 billion unspent. Leftover funds return to the U.S. Treasury. Not only was much money unspent, but what was spent exceeded targets in some states and was well below them in others. •Pennsylvania, Maryland and Connecticut were initially allotted $179 million, but received $46 million more because they used up their initial funds, HUD spokesman Brian Sullivan says. Puerto Rico fared best. With funds to help 652 homeowners, it got 468 preliminary approvals, or 72%. More News New Mexico

NM Foreclosures Up 75%

From durangoherald.com -Initial foreclosure actions filed in New Mexico district courts against homeowners jumped 75 percent last month, according to new data released last week. Irvine, Calif.-based RealtyTrac said initial foreclosure filings rose from 350 in September to 611 in October. Still, the pace of these initial filings was down from the 663 reported statewide in October 2010. More News New Mexico

Republican Senator Calls on Obama to Cancel Fannie Mae, Freddie Mac Bonuses

From FoxNews.com - A Republican senator is calling on President Obama to cancel the $12.8 million in bonuses that were approved for 10 executives at the government-seized mortgage giants Fannie Mae and Freddie Mac that received a $170 billion taxpayer-funded bailout. “I am calling on the president of the United States to cancel those bonuses and explain to the American people, the taxpayers who bailed out Freddie and Fannie, why he continues to reward failure,” Sen. John Barrasso, R-Wyo., said at a news conference Tuesday. Sen. Spencer Bachus, R-Ala., is pushing a bill to suspend pay packages at Fannie and Freddie and require executives and employees of government-sponsored enterprises to be paid according to the federal pay scale. Politico first reported the $6.46 million in bonuses for the top five officers at Freddie Mac -- including $2.3 million for CEO Charles E. Haldeman Jr., who is stepping down next year -- and $6.33 million for Fannie Mae officials, including $2.37 million for CEO Michael Williams. A second bonus installment for Freddie executives in 2010 has yet to be reported to the Securities and Exchange Commission, Politico reported. White House aides say the president took a lead on cleaning up excessive compensation on Wall Street with the Dodd-Frank bill, but those provisions do not apply to Fannie and Freddie. “The White House was not involved and nor should it be,” White House Press Secretary Jay Carney said Tuesday. Read more:

Fed Stands Pat, Announces No New Stimulus

From FoxBusiness.com - As expected, the Federal Reserve Board stood pat on Wednesday, refraining from further economic stimulus programs and leaving interest rates alone. The Fed said economic growth “strengthened somewhat” during the third quarter, which reflected a reversal from the spring when growth slowed due primarily to temporary factors such as the Japanese earthquake and tsunami in March. The question on many minds ahead of the Fed’s decision was what weapons the Fed has left to spur economic growth. Another round of quantitative easing has been hinted at but there is strong opposition both in Congress and among the handful Fed dissenters to the central bank buying up more debt on top of the nearly $3 trillion already purchased since the 2008 financial crisis. The first two rounds of quantitative easing have been met with limited success at best and skeptics say another round isn’t likely to help much either. Besides, improving liquidity by essentially printing money eventually leads to inflation. Read more

Did the Greeks just steal Christmas?

From MSN Money - After a strong October rally, stocks and the economy seemed poised for a typical Santa Claus rally into the new year. But a Grinch from Athens has put all that at risk. Fate has been a cruel taskmaster lately. For more than two years, stocks have stumbled through a broad trading range as the initial excitement over the end of the recession was replaced by alternating waves of greed and fear. For the better part of October, it looked as if a turnaround was at hand. The NYSE Composite gained nearly 23% in just four weeks. Confidence was rising. Money was flooding into the stock market. Even the housing market was showing signs of life. The pieces were in place for a classic Santa Claus rally, lifting everyone's spirits and giving us hope that maybe, just maybe, the market could push to new recovery highs and the economy would break out of its jobless funk in the new year. Then, it all went wrong. The market turned down on Monday, Halloween, as the market realized Greece wasn't quite settled yet. But the real blow came Tuesday, when Greek Prime Minister George Papandreou dropped a load of napalm on the revelry. He would let the people of Greece decide what to do by holding a referendum on the latest bailout plan by January. The question would be simple: Do we reject or accept Europe's new plan for us? This pull of the string is unraveling a seam along what was always the eurozone plan's point of vulnerability: a lack of political support from Greek citizens unwilling or unable to bear the burden of their national debt. Read more

Food Stamp Use Reaches Record 45.8 Million

From hotair.com -A new report posted today by the U.S. Department of Agriculture shows a record 45.8 million Americans received assistance through the Supplemental Nutrition Assistance Program in August — 1.1. percent more than in July and 8.1 percent more than in August 2010. That new record is not surprising: The number of Americans receiving food stamps has reached new highs every month except one since December 2008, according to Bloomberg. Spending on the program also reached a record $6.13 billion. On the one hand, part of the increase has to be attributed to the high unemployment rate of 9.1 percent. On the other hand, joblessness can’t be the entire explanation. Anyone who has seen “the EBT rap” knows food stamps aren’t exactly what they used to be. More News New Mexico

Commentary: No more junk economics

From NM Politics.net - After watching and listening to economists and politicians ride the media merry-go-round, espousing their economic recovery plans and sounding like freshman economics teachers or Madison Avenue ad executives, I couldn’t stand it anymore. I turned off the television set and thought about what’s wrong with all their arguments, whether it’s stimulus-based deficit spending, 9-9-9, or 20-20 in 2020. Then it came to me: What’s wrong is that the economic theory we practice today is not science, though we insist it be presented as such. It’s more like art – not the paint-by-numbers variety, but a traditional school of art like realism that depends on a few constants: a stable, unchanging motif; suspension of conscious analytical judgment (allowing only the eye and not the mind to judge the depiction of reality); and the use of dependable tools like the right brushes and paint or, as in the case of the marketplace, interest rates, taxes, incentives, investments, etc. Read more

People Over Profits: Faulty Logic

From the Truth Project - by Dr. Del Tackett - One of the consistent signs exhibited at the Occupy Wall Street protests is the slogan: “People Over Profits”. If you hear them chanting anything, it will probably be this slogan. It is intended to make the reader or hearer believe two things:–1st that people and profits are a contradiction. That is, one can either support uplifting people or pursue profits, but obviously not both;–and 2nd, given this horrible dilemma, one must choose people. Now, if the 1st premise is true, then I would agree that choosing people is the better choice. However, this is a much-used ploy in attempting to fool the opponent with faulty logic by setting up a false contradiction. Maybe someone should start a group called “Up With Profits” and sing about how profits help people…immensely.–Profits produce food…–Profits produce clothes…–Profits produce tractors and plows and medicine and seat belts and sunscreen and chocolate ice cream. But most importantly, profits produce jobs…more jobs…and that is exactly what the poor need. So, next time you see someone with a “people over profits” sign, recognize the problems with their logic and engage them in a winsome conversation about how those two things are not contradictory. You may want to illustrate by showing them that the only way they could make the sign was to use the profits of the paper company and the profits of the pen company and even the profits of their teachers who taught them to write but failed to teach them logic. Read more

U.S. rating likely to be downgraded again: Merrill

From Yahoo! news - NEW YORK (Reuters) - The United States will likely suffer the loss of its triple-A credit rating from another major rating agency by the end of this year due to concerns over the deficit, Bank of America Merrill Lynch forecasts. The trigger would be a likely failure by Congress to agree on a credible long-term plan to cut the U.S. deficit, the bank said in a research note published on Friday. A second downgrade -- either from Moody's or Fitch -- would follow Standard & Poor's downgrade in August on concerns about the government's budget deficit and rising debt burden. A second loss of the country's top credit rating would be an additional blow to the sluggish U.S. economy, Merrill said. Read more

Poverty is Way Up In NM

From businessinsider - Despite a year of economic growth following the end the recession in 2009, the number of poor rose in nearly every area of the US in 2010. Citing new US Census data released Thursday, Reuters reports that New Mexico and Mississippi have more than one in five people living in poverty, the highest in the nation. Read full story here: News New Mexico

Bingaman and Udall Push Bill to Expand Zoning for Mexican Nationals to Travel

Sen. Udall and Sen. Bingaman

From kfoxtv.com -Senators Jeff Bingaman and Tom Udall proposed a bill that would help bring more potential economic activity to cities that include Las Cruces, Deming, and Lordsburg. They want to expand the limit that Mexican nationals with biometric border crossing cards can travel so that the state's largest southern cities can have the same economic benefit as El Paso and other border towns. "There would be a lot more economic activity." Mexican nationals with approved border crossing cards, known as laser visas, can currently travel up to 25 miles into the U.S. for 30 days without needing another permit. Bingaman said he's confident that the border limit will be enforced, even though there's no actual checkpoint between the El Paso area and Las Cruces. More News New Mexico

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