Friday Morning News, Links, And Views -- Krugman Must Have Missed The Bull Market --Part II

What happened to global warming and all those hurricanes we should be experiencing this summer? The Christian Science Monitor is even asking:

The weather system that had become tropical storm Gabrielle overnight Wednesday has abruptly lost strength and was demoted to tropical-depression status with sustained winds of only 35 miles per hour at 11 a.m. Thursday.

And so goes the 2013 Atlantic hurricane season so far.

The season has produced seven named storms to date – meaning tropical storms or hurricanes. Typically, the seventh named storm doesn't appear until Sept. 14, according to data gathered by the National Hurricane Center.

The number of named storms is on pace to fall within the range several seasonal forecasts have projected. On average, however, the season should have seen its first hurricane by now, and none has emerged. Indeed, the first major hurricane, with maximum sustained winds of 111 miles an hour or more, typically appears around Sept. 4, notes Dennis Felgen, spokesman for the National Hurricane Center.

The storms are there; they just don't develop into full-fledged hurricanes. I assume Allah is trying to make it easy for President O'Bama, allowing him to concentrate on war plans and not be bothered by those pesky requirements for photo ops when hurricanes do hit.

**************************

WSJ Links

Sugar processors defaulting on loans. 

Sugar processors have defaulted on about $34.6 million in federal loans due in August, the U.S. Department of Agriculture said.

The USDA said Thursday that processors had forfeited an estimated 85,000 tons of sugar put up as collateral for the loans, marking the first defaults for the U.S. sugar industry since 2005. The defaults are a setback for the USDA, which has spent $53.4 million buying sugar this year to reduce a glut of the sweetener that has sent prices tumbling.

Peak sugar?

Cancer vaccine not working. 

An experimental cancer vaccine failed to help skin-cancer patients in a GlaxoSmithKline PLC clinical trial, a setback for a hot area of medicine that seeks to harness the body's immune system to fight tumors.

When compared to a placebo, the vaccine, called MAGE-A3, didn't increase the amount of time melanoma patients lived without their disease returning, Glaxo said Thursday. The 1,345 patients in the late-stage trial were given either the vaccine or a placebo after their tumors were surgically removed.

********************************

Mr Paul Krugman must have missed the bull market. He finally gets it --

Nobel Prize-winning economist and New York Times columnist Paul Krugman argues in his new editorial that U.S. economic policy over the last five years has been “an astonishing, horrifying failure.” Krugman, a long-time critic of the Obama Administration’s stimulus efforts, writes that the U.S. government should have spent three times the amount of money it did to get the economy back on its feet:

“…if the U.S. government had actually been able and willing to do what textbook macroeconomics says it should have done — namely, make a big enough push for job creation to offset the effects of the financial crunch and the housing bust, postponing fiscal austerity and tax increases until the private sector was ready to take up the slack…we would be a richer nation, with a brighter future — not a nation where millions of discouraged Americans have probably dropped permanently out of the labor force, where millions of young Americans have probably seen their lifetime career prospects permanently damaged, where cuts in public investment have inflicted long-term damage on our infrastructure and our educational system.”

It should be noted that the money from the cuts in public investment had to have gone somewhere: DOE-bankrupt solar energy companies; automobile/union bailouts; bank bailouts; O'Bamacare. Can you imagine how much better off we would have been had all that money gone into infrastructure: highways, ports, pipelines, railroads, bridges?

The unemployment rate down just 0.5 percent in 56 months under President O'Bama. And the trillions of dollars for job training and stimulus. Wow. The unemployment rate down just 0.5%, Krugman finally noted what we've been saying for quite some time: a nation where millions of discouraged Americans have probably dropped permanently out of the labor force, where millions of young Americans have probably seen their lifetime career prospects permanently damaged.

***********************

I guess Yahoo!Finance took Krugman's story and expanded upon it:

The dominant story about the job market is no longer the nation’s 11.3 million unemployed people or the painfully slow pace of hiring. It’s the growing portion of the working-age population that has dropped out of the labor force and isn’t even looking for a job.

The jobs report for August seemed upbeat on the surface, since the unemployment rate dropped by one-tenth of a point to 7.3%. But analysts have been quick to point out that the unemployment rate fell because the number of people looking for work -- part of the numerator in the equation used to determine the unemployment rate -- declined. That’s usually a sign of an ailing economy, not a recovering one.

Overall, the U.S. economy is being driven by a smaller portion of the population. The percentage of adults either working or looking for work peaked in the late 1990s, declined gradually until the recession began at the end of 2007, then began to fall more sharply.

Black unemployment edges up: now up to 13% ("official" -- the real unemployment rate is estimated to be a lot higher.)