Baum's Views on Money
Good morning. Here are some articles I'm reading to start the day.
Have I got a deal for you
If not new, at least it was concrete. Speaking to a sea of cardboard boxes at an Amazon.com distribution center in Chattanooga, Tennessee, yesterday, President Barack Obama proposed cutting the corporate tax rate in exchange for new spending on education, training and infrastructure. How do you spell, "non-starter?" Here's a better idea for the president: Stay home, tweet the link to the fact sheet on the White House website and use the millions of dollars saved in travel and security expenses to create jobs. If you really want to strike a deal with Republicans, hop the limo up to Capitol Hill.
Help wanted, communication skills a plus
The Financial Times' Robin Harding says Obama's job description for the next Federal Reserve chairman could use an update. Sure, the central bank needs a leader who's familiar with the Fed's dual mandate (price stability and maximum employment), but Harding thinks the ideal candidate would possess crisis-management skills and the ability to communicate "the great abstractions of Fed policy."
Two bad choices for America's voters
The 2014 midterm elections are 15 months away, but already the political handicappers are wondering what kind of "wave" it will be. As it now stands, the GOP has done nothing to improve its image with the electorate while voters have tuned out Obama. Political sage Charles Cook says the two negatives could cancel one another out, suggesting more of the same.
The Fed releases a statement at 2 p.m. today at the conclusion of its meeting. None of the economists surveyed by Bloomberg News expect an announcement on tapering its $85 billion of monthly bond purchases. Come September, however, 50 percent say the Fed will signal the beginning of the end. Oh, and if economic conditions change, the Fed's actions will change with them.
The American dream and the healing process
The U.S. home ownership rate was unchanged at 65 percent in the second quarter from the first, the lowest in 18 years. Yes, the housing market is healing. Sales, starts and prices are up. But markets would have done that on their own if the Fed had run monetary policy for the overall economy instead of focusing on long-term rates to boost housing. It's time to leave fiscal policy to the federal government, scary as it may be.
(Caroline Baum is a Bloomberg View columnist. Follow her on Twitter.)