Economy and Politics «

    On Wall Street, workers talk, CEOs walk

    Whatever. What we do know is that for all of the troubles endured by the alleged insider trader, it’s a good life to have closed your firm to outside investors, paid a $1.2 billion fine and still ended up with a net worth estimated at more than $9 billion. Oh, and he still has his freedom. Freedom is nice to have especially if you and the firm that bears your name has a mountain of allegations against it the way Cohen’s SAC Capital Advisors LP does. Cohen’s relatively uninterrupted life in the midst of accusations, convictions and admitted wrongdoing underscore how the scales of justice aren’t merely tipped against the junior players on Wall Street, they’ve been run over by a Bentley. Ask Mathew Martoma, the former SAC portfolio manager who actually was charged with insider trading. He’s...


    Hillary Clinton’s no slam dunk in 2016, and more must-reads

    Hillary Clinton, a slam dunk in 2016? Not if you ask Larry Sabato, a professor at the University of Virginia. Writing for Politico, he says the former first lady and secretary of state is more vulnerable than everyone thinks. “A consensus choice for a major-party presidential nomination is exceedingly rare,” he writes. Rep. Dave Camp is facing hurdles for tax reform, the Hill writes. The chairman of the House Ways and Means Committee has to convince the House Republican leadership that a tax overhaul is worth the effort in 2014. The calendar is another obstacle: Lawmakers are scheduled to be on the campaign trail for most of the fall. Michigan Republican Camp has said he wants to release a bill early this year. Chris Christie just can’t stay out of the spotlight. The New Jersey governor is scheduled...


    Is the economy finally picking up?

    After more than seven years of sluggish growth, you can’t blame economists for hoping that each new number that comes down the pike might be that all-important harbinger of better times. As a result, they have adjusted their forecasts accordingly. As my colleague, Jeff Bartash, reports, a rising number of economists now think that the U.S. economy will grow by 3% or more this year — the most in nine years. They base this on a number of developments, mainly reduced uncertainty inside the Beltway. For one thing, the government is set to be funded for the next two years. This reduces the likelihood that the government will be shut down for lack of money. For another, there are no new taxes scheduled to be imposed. This means that fiscal drag will not increase any more than it already has. However,...


    IMF sees complex capital flows from Fed taper

    There will be “complex capital movements across countries for some time to come” as the Federal Reserve continues to taper its bond purchases this year, said Olivier Blanchard, the chief economist of the International Monetary Fund, on Tuesday. The challenge for the Fed will be to normalize monetary policy as the recovery takes hold, Blanchard said in remarks prepared for a press conference updating the IMF’s economic outlook. Only some of this expected normalization has already been priced in both long rates and exchange rates, he said. Emerging-market economies with “weak macro frameworks” may be the most affected, he said. When the Fed hinted at a taper last spring, many emerging-market economies saw their currencies, bonds and stocks fall as global investors pulled back....


    Inflation trends that helped (and hurt) wallets most

    Inflation certainly isn’t raging out of control, as many predicted it would when the Federal Reserve and the Obama administration took decisive action to stem the crisis. But inflation isn’t totally quiescent, either. As the name implies, the consumer price index measures prices paid by consumers at retail. It measures average prices across the country, and gives each item a weighting in the index in proportion to how much the average consumer spends on each. Inflation that hurt our wallets the most Item SHARE OF SPENDING ANNUAL INFLATION RATE CONTRIBUTION TO CPI Owners equivalent rent 24.1% 1.5% 0.35 pts Rent of residence 6.6% 2.0% 0.13 pts Food away from home 5.7% 2.3% 0.11 pts Car insurance 2.5% 4.4% 0.11 pts Hospital services 1.6% 6.0% 0.10 pts College tuition 1.8% 4.9% 0.09 pts Tobacco products...


    What FCC decision means for cable-cord cutters

    TV fans on the fence about ditching their cable boxes may want to see how the legal tussle between Verizon /quotes/zigman/262341/delayed/quotes/nls/vz VZ -0.37% and the Federal Communications Commission shakes out. If Tuesday’s court ruling against the FCC is in fact the series finale of “net neutrality,” then the cost of cutting the cord in favor of streaming shows on Netflix /quotes/zigman/87598/delayed/quotes/nls/nflx NFLX -0.49% and other services could soon rise, experts say. The U.S. Court of Appeals in Washington, D.C., rejected the FCC’s so-called open-Internet rules, paving the way for cable companies to give some broadcast companies and video streaming services preferential treatment. The 2010 Federal Communications Act forced companies like Comcast and Verizon Communications to...


    U.S. seen on track for best growth since 2005

    Most economists think the dismal 74,000 increase in net hiring last month was a fluke caused by poor weather and seasonal-adjustment problems that will soon be revised away or prove to be an aberration. The way those with a sunnier view see it, the road is clear for the U.S. to produce its fastest spurt of growth since the Great Recession. There’s no big crisis in Washington brewing, U.S. households are better off financially and businesses are raking in the profits. Nor are there any major global threats to the economy on the horizon. Consider the new forecast by top economists at the nation’s leading bank firms. They predicting the U.S. economy will hit 3% growth in 2014 for the first time in nine years. The forecast by the advisory panel of the American Bankers Association is no outlier, either....


    3 things you need to know about Obama’s new spy proposals

    President Barack Obama on Friday called for major changes in U.S. spy operations. Here are three things you need to know about what he proposed. Read a recap of Obama’s speech, as live-blogged on Capitol Report. First, Obama said he is ordering an end to the government’s bulk collection of metadata “as it currently exists.” But who’s going to hold that data instead? That’s unclear right now. “More work needs to be done to determine exactly how this system might work,” he said. “This will not be simple.” Moving the data out of government hands will take time. But Obama said that effective immediately, intelligence officials will need a court order to access it. “The database can be queried only after a judicial finding, or in a true emergency,” he said. Another immediate directive...


    Ex-Bush aide Ed Gillespie launches Senate campaign

    Ed Gillespie, a onetime aide to President George W. Bush and a former chairman of the Republican National Committee, said Thursday he’s running for a Senate seat representing Virginia. If he wins the Republican nomination in June (where, says Politico, his longtime party involvement should pay off), he’ll challenge first-term Democrat Mark Warner. Gillespie made his run official with a video posted on YouTube that touts his working-class roots, including the stint as a U.S. Senate parking-lot attendant that helped him pay for college. Like most Republicans, Gillespie takes an anti-Obamacare line, saying it kills jobs. Warner could prove tough to beat: He won his seat in 2008 with 65% of the vote, defeating former Virginia Gov. Jim Gilmore. But Gillespie is clearly hoping the troubled Obamacare rollout...


    Now it’s the Fed doves who are agitated

    For the longest time, it was the hawks on the Federal Reserve who have been uncomfortable, out of a general sense the Fed has gone too far in its efforts to stimulate the economy. But in the wake of the Fed’s decision in December to begin to start to pull back these stimulative efforts, it is the doves who are agitated. And the most agitated is Narayana Kocherlakota, the president of the Minneapolis Federal Reserve Bank. He sits on the dovish extreme of the Fed policy committee and has a vote on the Fed’s policy committee this year. In an interview with the Financial Times, Kocherlakota said the Fed needed to be doing more to stimulate the economy. Kocherlakota seemed resigned to the idea that the majority on the Fed want to continue to taper its bond-buying purchases. Even other doves, such as Charles...