Happy Friday, everyone. Here's your daily dose of what I'm reading.
Why didn't Ithinkof that?
Last week, I offered my own tongue-in-cheek suggestions for Federal Reserve chairman, including the IBM Watson and Edward Snowden, which you can read on Bloomberg View. The Financial Times' Gary Silverman takes it a step further. He says that since the next Fed chief may do "nothing more than produce text," President Obama might want to consider "a professional writer for the post." Brilliant! If communication is a) important and b) a policy tool, you want the best communicator you can find. Someone bilingual in Fedspeak would be perfect for the job.
Expectations crowd has the edge
Monetary policy makes progress "one disaster at a time," according to the Economist, which walks us through the lessons learned. Decades after the Great Depression, Friedman and Schwartz showed that money mattered. The 1970s confirmed that it did -- with too much, not too little. Nowadays, central bankers are enamored with rational expectations. Mark Carney just exported his brand from the Bank of Canada to the Bank of England. How about some hard evidence that all this talk therapy has done any good?
This just in
Forecasters aren't very good at what they do. And according to a study, their misses conform to certain patterns. Forecasters tend to underestimate results for several months before they switch sides and overestimate. If these folks had ordinary jobs, it wouldn't matter much. But forecasters' expectations are built into market prices. Markets react to the actual data relative to expectations. It's not intuitive how high-frequency traders can use this to their advantage.
The last shall be first, and the first shall be last
California, Nevada and Florida were among the states hardest hit by the bursting of the housing bubble. Now those areas of the country are coming back strong. Although nationwide median home prices rose 12.2 percent in the second quarter from a year earlier, Sacramento took first place with a 39.2 percent increase. Delinquencies and foreclosures fell to a five-year low in the second quarter as well. The biggest problem right now, in addition to qualifying for a mortgage loan, is a lack of housing supply. Pretty soon the president will be pushing for more affordable housing. Oh, wait, he already is.
Q&A with Obama
At 3 p.m. today, President Obama holds a news conference at the White House before jetting off to Martha's Vineyard, where we are all eager for his arrival. Politico has six questions for him, including his willingness to risk a government shutdown over spending cuts; problems surrounding the implementation of Obamacare; and his assertion that al Qaeda is "on the run." I hope the president answers the questions. Even more, I hope the White House press corps presses him on it.
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