6 months ago

Interest rate hikes slow the economy. So why did the Fed just announce one?

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Federal Reserve chair Janet Yellen |Photo by Win McNamee/Getty Images

The Federal Reserve has raised short-term interest rates, doing so for only the second time since the 2008 financial crisis. The move reflects the Feds growing confidence that the economy is on a sustainable growth footing and its judgment that inflation is becoming a bigger danger to the US economy than sluggish growth or another recession.

A central bank like the Fed faces a basic trade-off between economic growth and inflation. When the Fed cuts interest rates or keeps them low more cash flows into the economy and business tends to boom. Thats good up to a point, but if the Fed provides too much stimulus, it can lead to high inflation. The Fed made that mistake in the 1970s, when inflation reached double-digit levels.

Conversely, when the Fed raises interest rates as it did today less cash flows into the economy. That can lead to slower economic growth, with fewer jobs created and slower wage growth.

The Fed decided to raise interest rates today despite the fact that its preferred measure of inflation came in at 1.7 percent over the past year below its 2 percent target.

Normally, if inflation is too low, the remedy would be to cut rates, not raise them. So why did the Fed decide higher rates were in order? The Fed is concerned that inflationary pressures can build up over time, and that there can be a lag between Fed decisions and the resulting impact on inflation. In other words, its worried that if it were to keep interest rates low for the next few months, it might find itself with surging inflation in 2018 and be forced to raise rates more drastically to deal with the problem. That, in turn, could trigger a recession.

So the Fed is hoping that slowly and gradually raising rates it did its first post-recession interest rate hike a year ago will strike a careful balance between the twin dangers of inflation and recession.

The potential downside here is that a premature rate hike could prevent the economy from enjoying a robust economic boom. By some measures, the current economic recovery has been the weakest in decades, and some economists wonder if easier monetary policy could deliver a more robust economic expansion. But so far, that argument doesnt seem to have changed the minds of Fed decision-makers.

by Timothy B. Lee

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9 months ago

Ruling Means Some of Hillary Clinton's Emails Will Come Out After Election

Photo Lawsuits are seeking documents related to Hillary Clinton and her aide Huma Abedin, left, pictured on Mrs. Clintons campaign plane. Credit Stephen Crowley/The New York Times WASHINGTON A federal judge on Friday ordered the State Department to finish preparing roughly 1,000 pages of Hillary Clintons emails for release by Nov. 4, a more protracted timetable that means the bulk of Mrs. Clintons emails that were uncovered by the Federal Bureau of Investigation will not be released until after the election.

In August, the judge, James E. Boasberg of Federal District Court, raised the prospect of a flood of Clinton emails being released during the final weeks of the campaign, when he ordered the State Department to accelerate the release of nearly 15,000 new emails.

But Judge Boasberg acknowledged the burden for the departments lawyers in reviewing thousands of emails, as well as responding to multiple lawsuits under the Freedom of Information Act that seek documents relating to Mrs. Clinton, her aide Huma Abedin, and the Clinton Foundation.

Under the order issued on Friday, in a lawsuit brought by the conservative group, Judicial Watch, the State Department will release 350 pages of emails by Oct. 7, 350 pages by Oct. 21, and another 350 by Nov. 4. After that, it will produce 500 pages a month. Judge Boasberg summoned the lawyers for another status report on Nov. 7, the day before the election.

Questions about Mrs. Clintons private email address and server have hung over her presidential campaign for more than a year, even after the F.B.I.s director, James B. Comey, said in July that her conduct did not warrant criminal charges for mishandling of classified information. Mr. Comey said the F.B.I. had discovered thousands of emails that Mrs. Clinton had not voluntarily turned over to the State Department before its investigation.

Continue reading the main storyOf the nearly 15,000 emails the F.B.I. turned over to the State Department in late July, roughly 9,400 were purely personal, according to the departments lawyers. They will therefore not be released. That leaves about 5,600 work-related emails to be reviewed. But roughly half of those may be wholly or largely duplicates of emails that have already been released.

Duplicates could take the form of a previously released email, which Mrs. Clinton may have forwarded to her aides with orders to print it out. In some cases, the emails were part of long chains, on which Mrs. Clinton was copied at the beginning, but later left off the list of addressees.

We are currently processing these documents for release, said the State Department spokesman, John Kirby. As we have done so, we have noticed that some personal emails remain within the approximately 5,600 documents, so the number may be further reduced.

Each email generates roughly 1.8 pages of print, a government lawyer said, which means about 10,000 pages will be released in total. Only about 10 percent will be made public before the election, which prompted a complaint from Judicial Watch.

The public deserves to know what is in those emails, well before Nov. 8, and the State Department should not continue dragging its feet on producing them, the groups president, Tom Fitton, said in a statement. The American people need to pressure State to stop sitting on these new Clinton emails for political reasons and release them as the law requires.

Continue reading the main story

12 months ago

US corporations reap trillions from politics - STLtoday.com

It isnt so much that the rent is too high, it is that firms are earning too much of it from political influence and too little from innovation.

The decades-long upward march of U.S. corporate profit margins, and with them company valuations to historically high levels, raises questions of how much is derived not from genuine wealth creation but rent-seeking, the extraction of profit through some monopoly-like advantage.

Not all rent-seeking is odious: build a better mouse trap and until the competition catches up you make extra profit and the world loses extra mice. But in economics No

1 year ago

Kalamazoo shooting suspect Jason Dalton in court Friday

Jason Dalton will return to court Friday.(Photo: File photo)

A Kalamazoo manaccused of killing six people and wounding two others in a February shooting rampage will return to court Friday for an update on his competency exam.

Jason Dalton, 45, is set to appear before Judge Tiffany Ankley at 11 a.m. in the 8th District Court in Kalamazoo, court officials confirmed.

Dalton, who was an Uber driver,is charged with six counts of murder and two counts of assault with intent to murder in the case and is undergoing a mental evaluation before a preliminary examination can be held in Kalamazoo County Circuit Court.

In a series of interviews with police in the hours after the Feb. 20 shootings, Daltonblamed the killingson the Uber app, sayinghis iPhonedirected him where to go and when toshoot people. Daltonsaid he would have gotten in a shootout with police when he was arrested, but the app directed him not to.

Dalton is accused of shooting people at three locations across the Kalamazoo area the evening ofFeb. 20, in betweenpicking up passengers as an Uber driver. AKalamazoo County sheriff's deputy arrested Daltonshortly after midnight on Feb. 21.

Dalton told police that earlier that Saturday when he opened up the Uber ride service app, a symbol, which he believed was the Eastern Star, popped up. Dalton said the symbol resembled a devil's head and "that's when all the problems started."

"Dalton described the devil figure as a horned cow head or something like that and then it would give you an assignment and it would literally take over your whole body," according to police reports releasedto the Free Press by theKalamazoo City Attorneys Office.

His wife, Carole Dalton, told investigators with the Kalamazoo County Sheriff's Office that he had told her a different story. She said he told her that day that he was having problems with a jealous taxi driver who'd shot at him, and that she should stay away from their home unless she was armed, according to sheriff's reports also released Monday.

Dalton told police he experienced "a full body takeover" during the shooting spree and expressed concern about being placed in the general population at the jail because of what he did.

"I asked Dalton what made him get his gun tonight and he said the Uber app made him," an investigator said in thereports.

Contact Katrease Stafford: kstafford@freepress.com or 313-223-4759.

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1 year ago

Ample Ideas For HVAC Around The Nation - HVAC Contractors NJ

HVAC will help you get your house working once more. What is HVAC? It's what warms you in the winter and cools you in the summer. Are you having issues with your current set-up? Would you like to install something new like an upgrade? To find out more about the situation, check out the advice that can be found below.

Ask for referrals when hiring someone to install your HVAC system. You cannot simply take their word for it, though someone may seem like they know what they are doing. You should be able to call past customers to get an idea of what to expect from this particular installer.

An HVAC system is a really expensive investment. This is why you should do some browsing

2 years ago

Why Kobe Bryant was so important to the NBA - ESPN

LOS ANGELES -- It's not the where of Kobe Bryant so much as the when. We get so caught up in rankings that we don't think of timing. The polarizing properties of Kobe mean the arguments over his place among the NBA greats will continue long into his retirement, so let's take a moment to discuss the one element that's not up for debate: He was the NBA's most important player from 2000 to 2009.

Kobe Bryant will call it a career after this season. We have all of the news, reaction and analysis covered, and break down what 20 years o

2 years ago

Obama and other leaders due in Paris for major climate change conference - CNN

Story highlightsU.S. and Chinese Presidents set to meet Monday morningBig climate march that was planned for Sunday is banned after terror attacksNearly 150 world leaders are expected to descend on Paris for the start of the U.N. climate change summit that starts Monday in the French capital with the aim of reaching a landmark global deal on limiting greenhouse gas emissions.

The leaders of the United States, China and India -- the world's top three carbon-emitting countries -- are among those scheduled to attend the opening day of the event, known as COP21.

It's being held amid heavy security after the deadly terrorist attacks that struck Paris two weeks ago. French authorities have clamped down on public demonstrations in the aftermath of the attacks, blocking environmental campaigners' plans for a big march on Sunday in Paris to highlight the climate change issue.

Refusing to be muted, some activists said they intended to cover the city's Place de la Republique with shoes to symbolize the steps that marchers were being prevented from taking. Demonstrations are also expected in other cities around the globe.

Opinion: Climate change is a form of terror

Obama to meet Chinese PresidentFrench President Francois Hollande is meeting with several world leaders Sunday ahead of the start of the two-week conference, including U.N. Secretary-General Ban Ki-moon and Chinese President Xi Jinping.

U.S. President Barack Obama is due to arrive in Paris late Sunday and meet with Xi the following morning.

"Clearly, U.S. cooperation with China is absolutely essential to successful efforts to combat climate change," White House Deputy National Security Advisor Ben Rhodes said in a briefing last week. "I think the two leaders meeting at the beginning of this process, as the two largest emitters, sends a strong message to the world about their shared commitment to combat climate change and to achieve an ambitious agreement."

More than 40,000 delegates from 195 countries are attending COP21, which has the goal of achieving a legally binding agreement to keep global warming below what most scientists say is the critical threshold of 2 degrees Celsius of warming.

5 things you need to know about COP21