Feb 19 If excess liquidity has caused these investments that are now going bad, how does the Fed increasing liquidity with lower interest rates help the economy? Question/Comment: If excess liquidity has caused these investments that are now going bad, how does the Fed increasing liquidity with lower interest rates help the economy? Paul Solman: Because it prevents the system from freezing up entirely. It’s a calculated… Continue reading
Feb 15 What is better, inflation or a recession? Question/Comment: I am a saver whose income is mostly CDs. We seem to be facing both a recession and inflation. Which of those two is better for me? I assume it is recession? Paul Solman: Neither is better for you… Continue reading
Feb 15 It's been a long time since I took Econ. 101, but as I remember, if you keep printing ever-greater amounts of currency, inflation takes on a life of its own. Question/Comment: It’s been a long time since I took Econ. 101, but as I remember, if you keep printing ever-greater amounts of currency, inflation takes on a life of its own. Isn’t that what we’ve been doing at the rate… Continue reading
Feb 14 Hurricane Victims Should Leave Toxic Trailers, CDC Says By Admin, PBS News Hour Federal officials said Thursday they will intensify efforts to move Gulf Coast hurricane victims out of some 38,000 government-issued trailers as quickly as possible after tests found toxic levels of formaldehyde fumes. Continue reading
Feb 14 If I hear one more presidential (or candidate) speech about the imperative to rescue those poor subprime home owners, I will scream. Question/Comment: Paul, If I hear one more presidential (or candidate) speech about the imperative to rescue those poor subprime home owners, I will scream. Not one economist, not one candidate, no one ever addresses the painfully unregulated and rogue rental… Continue reading
Feb 13 Watch TV Writers Vote to End Union's 3-Month Strike Members of the Writers Guild of America returned to work Wednesday, after voting to end a 100-day strike that left many out of work and TV shows in reruns. Michael Winship, president of the WGA-East, discusses the details of the… Continue watching
Feb 13 How can such enormous debt be sustainable and what happens to the world economy if the U.S. defaults? By Business Desk Question/Comment: I am a Canadian. Unfortunately, 87 percent of our trade is with America. Consequently, U.S. recessions are felt more deeply in Canada. However, my questions are about the American debt. My understanding is that the debt could reach $10… Continue reading
Feb 12 Watch GM Offers Employee Buyouts After $38.7 Billion in Losses After announcing record annual losses Tuesday, General Motors said that it would offer buyouts for all 74,000 of its union employees -- allowing GM to hire lower-wage workers -- to help reduce costs. New York Times business reporter Micheline Maynard… Continue watching
Feb 12 Watch Billionaire Buffett Offers to Help Insure Municipal Bonds Billionaire investor Warren Buffett announced Tuesday that he would help shore up three insurance bond firms by offering additional insurance on up to $800 billion in municipal bonds. The Wall Street Journal's David Wessel explains how bond insurers impact Wall… Continue watching
Feb 12 Watch Lenders Sign-on for Plan to Help Prevent Home Foreclosures The Bush Administration and six of the nation's largest banks agreed on a plan Tuesday that would delay some home foreclosures by 30 days, allowing lenders to negotiate more affordable terms. Treasury Secretary Henry Paulson discusses the details of the… Continue watching