South By North Strategies, Ltd.

A Defense Of Quantitative Easing

A recent segment on The PBS NewsHour reported on the rationale underlying the Federal Reserve’s policy of quantitative easing and the international criticisms being leveled against the approach. Note the discussion about the need for greater fiscal policy action.

Around The Dial – Nov. 22

South By North Strategies In The News

South by North Strategies recently was featured in several media stories related to the health of North Carolina’s labor market and the state’s budget situation.

• Triangle Business Journal: “GOP’s Berger: Cut state spending by 15%”
• The Winston-Salem Journal: “Jobless numbers improve just 0.1%”

Wither The Young?

A guest post at The Baseline Scenario considers the terrible, if overlooked, economic conditions facing America’s young adults.

Jobs aren’t the whole story. Recent college graduates, those in the labor force with the freshest batch of knowledge and skills, are currently underwater and sinking fast with unprecedented student loan and personal debt. Average student debt for the class of 2008 was $23,200, an increase over four years of about 25%, meaning that students are knee deep in negative equity between their educational investment and actual earnings.
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Between inflated student debt and the lack of available jobs for qualified graduates, students are defaulting at anall time high level of 7.2%. From 2008 to 2009, student debt defaults jumped about 30% to $50.8 billion. This earning-to-debt gap not only hurts lending institutions, but also may affect students’ future abilities to borrow – a significant hurdle in our credit driven economy.
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If student debt and job stagnation continue, younger workers will face real structural unemployment (as opposed to the fake kind that had been suspected by some economists, but was recently debunked by the San Francisco Fed).  The more time these young workers spend unemployed and underemployed, the greater chance for future structural unemployment due to deteriorating human capital.

Around The Dial – Nov. 19

Economic policy reports, blog postings, and media stories of interest:

• The Wall St. Journal reports on the failure to extend unemployment insurance.
• Naked Capitalism summarizes Congress’ hearings on the foreclosure mess.
• Paul Krugman describes “the axis of depression.”
• Free Exchange runs down the newest state GDP data.
• Ben Bernanke explains Federal Reserve policy.