Not So Easy Being Green
Thank goodness California is pushing the green agenda. The state will benefit economically because all kinds of business and jobs will be created to cater to the new demand for cleaner power.
How many times have you heard that statement? Probably more than you heard how the Dodgers pitching was going to carry them into the World Series.
There’s one itty bitty problem, though: Thanks to the green agenda, it’s quite possible the state will be a net loser economically.
The fact is, jobs and businesses likely will be created as a result of California’s still-new law called AB 32. That’s the one that mandates greenhouse gas emissions be chopped back about 30 percent by 2020 and more thereafter. But it’s also likely that a good number of jobs will be destroyed or will migrate out of the state, too. Whether the former will offset the latter is an open question. In other words, is it really more likely we’ll lose or win?
Going Negative – Could the Fed funds rate go to zero?
The Federal fund overnight target rate was lowered to 1% this week, bringing us back to the record low interest rate reached in 2003/4. How low can it go?
For those of you keeping score, since August 2007 when the current economic crises really got going in the public eye (they have been building up for decades before the media turned on its spotlight), the Fed cut the funds rate from 5.25% down to 1.5% and then Wednesday, another ½ point, to 1%. One penny on the dollar.
If the overnight rate keeps going down, and some say it must, it will reach zero. That is where Japan’s economy was during much of the 1990’s when their ‘asset price bubble’ (also charmingly known as ‘the bubble economy’), from 1986 through 1990, featuring hugely over-inflated real estate and stock prices, finally burst. Japan’s flat period, known as the “Lost Decade,” lasted a long time.
Turn the Other Cheek
This piece appeared today in the Washington Post
These days, Californians may be forgiven for feeling as though they are playing host to a dinner party whose guests keep arguing in nastier and nastier terms.
Proposition 8 — the statewide initiative that seeks to add a ban on same-sex marriages to the California constitution, reversing this spring’s court decision legalizing such unions — has turned into a bitter and expensive campaign, even by this sate’s standards. Money has been pouring in on both sides of the issue, from churches, businesses and human rights groups around the country. With more than $60 million raised for and against the initiative, contributions to Prop 8 already exceed the combined total of all donations in the 22 previous campaigns over gay marriage measures in other states around the country.
The outcome is very much in doubt, with polls showing a tight race. But even if supporters of same-sex marriage manage to defeat Prop 8 and preserve the legality of such marriages here, their campaign against Prop 8 may eventually be considered something of a setback for the cause of marriage equality.
California Housing Blues
If you’re looking for a bottom in the California home price free-fall, keep looking. Standard and Poor’s released its monthly index of metro home prices, and the outlook is dismal for Sunbelt states, and for California in particular. The composite year-over-year average of San Francisco, Los Angeles and San Diego prices dropped in August by 27 percent, accelerating a trend that began in December of 2006.
Home Price Index
Walk This Way
When Aerosmith’s Joe Perry (who I have now dubbed “Joe the Guitarist”) offered his endorsement this morning of John McCain for President, the self-described “hard core Republican” had me cheering. Like “Joe the Plumber”, this “Joe” gets it.
Perry said that issues like national security and anguish over the economy prompted him to split from the rest of the entertainment world and throw his support behind McCain. “The Guitarist”, a man of humble beginnings who still lives in New Hampshire, talked about how his parents drilled it into him at a young age that hard work leads to success and that having people like Schwarzenegger and Giuliani on board definitely encouraged him to “raise his hand” to support McCain.