Explaining Southern California's economy

Why is the recovery jobless? Skills, baby. Skills.

Fighting to Stay Positive

Mae Ryan/KPCC

Victoria Long has been unemployed for two and a half years and her job search continues. She spends her time in an employment recruiting office as she searches for work.

First, the good news: there are jobs available in America! Now, the bad news: there aren't enough people with the right skills to take them. This is from Bloomberg Businessweek:

The number of positions waiting to be filled this year has climbed to levels last seen in 2008, when the jobless rate was around 6 percent. The housing bust and ensuing financial crisis put people out of work whose skills may not correspond with those needed by the health-care providers and engineering firms where jobs go wanting.

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A dearth of skilled applicants may prevent the unemployment rate from declining further and could crimp consumer spending, which accounts for about 70 percent of the economy. Companies also may remain reluctant to expand their workforces as the threat from Europe’s debt crisis and political gridlock in the U.S. weighs on the economic outlook.

Over the three months ended in October, the average number of positions waiting to be filled climbed to 3.26 million, the most in three years, according to Labor Department data released yesterday in Washington. The jobless rate, which averaged 5.8 percent that year, was at 9 percent in October. It fell to 8.6 percent last month, in part reflecting a drop in the size of the labor force, the agency’s data showed earlier this month.

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Wine Report: Good wine is actually better

I'm of the opinion that there's no bad wine anymore. Modern winemaking and viticulture have killed off the rotgut of yesteryear, vanquished the swill of the past, and sent the skunky stuff packing.

However, that doesn't mean that there isn't some wine that's better than other wine. 

Of late, I've been drinking a lot of el cheapo wine. But not too long ago, I discovered that the Whole Foods near KPCC's Mohn Broadcast Center in Pasadena carries wines imported by Kermit Lynch. As I've already blogged here at DeWine Report (heh heh), I'm a fan.

I was even more delighted to discover that Lynch is now selling his own self-branded blends. I picked up a bottle of the Côtes du Rhône ($14). 

Lynch has always had something of a preferred style for reds, particularly where Rhônes are concerned: bold, lusty, rustic, expressive of place but not stingy when it comes to powerful fruit-driven flavors, and with a healthy, immensely satisfying blast of spice and oak on the finish.

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Bank bailout math: It was actually $29 trillion

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AP Photo / J. Scott Applewhite

The Federal Reserve Building in Washington, DC.

How big was the too-big-to-fail bailout of U.S. banks? If you said, "$700 billion," then you'd be limiting yourself to the Troubled Assets Relief Program (TARP) that was authorized in late 2008, in response to the financial crisis.

But if you're a student of economist L. Randall Wray at the University of Missouri-Kansas City, backed by a Ford Foundation grant to find out just how much the bailouts cost, you'd have a slightly different answer: $29 trillion. Almost $30 trillion, actually, if it's your policy to round up from $600 billion.

Here's Wray, at the Huffington Post:

[A]nalyses of the bail-out variously put the total at $7.77 trillion (Bloomberg) to $16 trillion (GAO) or even $24 trillion. He argues that these reports make "egregious errors," in particular because they sum lending over-time. He also claims that these high figures likely include Fed facilities that were never utilized. Finally, he asserts that the Fed's bail-out bears no relation to government spending, such as that undertaken by Treasury.

All of these assertions are at best misleading. If he really believes the last claim, then he apparently does not understand the true risks to which he exposed the Treasury as the Fed made the commitments.

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Bitcoin Beat: Is it time to privatize money?

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Attila Kisbenedek/AFP/Getty Images

An employee changes the numbers of the currency information board in front of an exchange office on Aug. 8th in Budapest. The Swiss franc remained at its highs against the dollar, changing hands at 0.7594 to the dollar.

I've written several posts about Bitcoin and have used the feedback I've received from commenters to undertake a deeper dive into crypto-currencies. This led me to a recent op-ed in the Cypress Times by David Barker, tackling the idea that a "private" currency like Bitcoin could displace or at least compete with government-backed money.

Here's a salient paragraph, laying out the historical/academic case:

Nobel Prize winning economist Fredrick Hayek advocated privatization of the money supply as early as 1978. Barry Eichengreen, a respected, mainstream scholar of international finance recently wrote that “maybe the Tea Party should look for monetary salvation not to the gold standard but to private monies like Bitcoin.” Former Federal Reserve Governor Randall Kroszner and widely read blogger Tyler Cowen wrote a book in 1994 that discussed “the potential consequences of a complete deregulation of money and banking.” An article in the ultra-establishment Journal of Economic Literature by George Selgin was titled “How Would the Invisible Hand Handle Money?” Other economists study historical episodes where money was privately produced, often with favorable results.

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Eurozone Crisis: Hunker down and suffer time

People stand next to a stand as newspape

LOUISA GOULIAMAKI/AFP/Getty Images

People stand next to a stand as newspaper bearing headlines on the greek crisis, are on display on November 7, 2011 in Athens. Greece's top politicians put the finishing touches to a unity government and begin talks on a new prime minister as markets react cautiously to a historic power-sharing deal to stave off bankruptcy and keep the country in the euro. AFP PHOTO / LOUISA GOULIAMAKI (Photo credit should read LOUISA GOULIAMAKI/AFP/Getty Images)

Martin Wolf is, according to many, the best finance and economics journalist in the world. From his perch at the Financial Times, he dispenses regular wisdom and concise opinion. And it's wisdom and opinion that's backed up by having done time on both sides of the major economic divide of the age: free markets versus central governments.

The ongoing eurozone crisis has involved all sorts of deep-dish coverage, ranging from sovereign debt bond-yield spreads to debates about tax policies and budget cutbacks, with gobs of court-intrigue political analysis and EU-ology thrown in. It's frankly dizzying. Also, the debate has gone exactly nowhere. The eurozone remains in crisis. Whatever political will is being deployed has been, it seems, devoted to perpetuating rather than resolving the problem.

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