Russian economic catastrophe

Six million Russians fall into poverty in the first three months of 2009.

The Guardian

No kicks on rt 66 these days

Excellent series (so far) at the Guardian: The Grapes of Wrath revisited: "From Oklahoma to California, Chris McGreal re-traces the route of Steinbeck's epic depression era novel." After the first two installments, I can say this is an exceleent piece detailing the impacts of the Great Recession on people, wrapping in health care, deindustrialization and strange politics.

Chef has recipe for economic disaster

Michelle, at Thursday Night Smackdown, has as interesting an economic prediction as I've seen on the Hobo Mondays page. Scroll down and you'll see the following:

The Rules: Since we’re all poor now and our economy is going to keep heading down the shitter until it somehow finds an even bigger shitter down which to hurl itself*, Cheap Ass Mondays (now Tuesdays) seemed like a much better idea for an event.

Then the footnote:

*My prediction: this will continue to happen, with the economy throwing itself down progressively more and more enormous shitters, until we discover a black hole at the center of the universe that is actually a giant toilet. Take that, Hawking.

Brilliant. Why are you not reading this blog?

House Prices Won't Be Rising for Long

James Hamilton, at Econbrowser, notes that he's surprised by the 0.75% increase in average house prices (as measured by the S&P/Case-Shiller Index of twenty cities). He also says he's skeptical because of the backlog of unsold homes, likely increases in foreclosures, and high, rising unemployment, especially since Calculated Risk is, too. I agree that there's reason to be skeptical, especially since this rise in prices is likely to be a surge of people cashing in on the Obama stimulus package's $8,000 tax credit for first-time home buyers, which expires this fall. If prices continue to rise beyond that critical point, I'd say my skepticism (and CR's and Hamilton's) are wrong.

No one is rational

Chris Dillow on Keynes & irrationality. Quite good and clear.

Stiglitz argues for a second round of stimulus

Joe Stiglitz, writing on Project Syndicate, argues that the first round of stimulus was too small and poorly designed, (designed to address political, not economic, concerns). More stimulus would be a great idea, especially transfers to states, almost all of which are having to implement disastrous spending cuts and/or tax increases to balance their budgets, as Stiglitz also points out. Whether or not you think state government budgets are bloated, now is not a good time to fix this 'problem.'

Industrial Production Up, But Not By Much

The Fed released its Industrial Production and Capacity Utilization report today, showing the first increase in production since December 2007 (other than a hurricane-related bump last October). Probable sign of a turnaround, yes, but overall production is down over 13 percent since last July. Consumer goods is least worst with a mere 7.2% drop. And capacity utilization (roughly: actual production divided by potential production), at 68.5%, is still just above its lowest level in the 45 years reported in the accompanying charts. We're in a deep hole, which will take some time to climb out of.

Updated Inequality Numbers from Saez

Via Paul Krugman:

With everything else going on, the latest inequality numbers from Emmanuel Saez, now updated to 2007, didn’t get much attention. But they’re truly amazing.

click through for graph.

EPI says Stimulus Plan is working

In a new report "The recovery package in action", EPI researchers John Irons and Ethan Pollack lay out the details of what they see the American Recovery and Reinvestment Act's impacts have been so far. Long story short, despite the fact that only 14% of the spending has happened so far, the Stimulus plan has helped to decrease the pace of job losses.
Of course, ahem, others have pointed out that although the employment effects will be large (6-8 million jobs over three years), the impact on income distribution will probably be small and come nowhere near offsetting the increases in inequality we've seen in the last two decades.