The 2009 Stimulus Package: Two Years Later

From Professor John B. Taylor... I would highly recommend visiting Prof. Taylor's blog here.

The 2009 Stimulus Package: Two Years Later

Testimony Before the Committee on Oversight and Government Reform Subcommittee on Regulatory Affairs, Stimulus Oversight and Government Spending U.S. House of Representatives February 16, 2011

Conclusion

In sum, the data presented here indicate that the American Recovery and Reinvestment Act was not effective in stimulating the economy. Despite its large size, ARRA did not result in more than an immaterial increase in government infrastructure and other purchases at the federal level. The large grants to the states did not result in an increase in government infrastructure and other purchases at the state and local level. And finally an analysis of the payments that temporarily increased disposable income shows that they did not significantly affect personal consumption expenditures. In contrast changes in private investment and net exports have been much more of a factor in the recovery. Currently, the increased debt caused by ARRA—both directly through its deficit financing and indirectly through its de-emphasis on controlling spending—is likely a drag on economic growth.

http://media.hoover.org/sites/default/files/documents/2009-Stimulus-two-years-later.pdf

Daily Mortgage Rate Review

Chart - 30 Yr Fannie Mae

Daily Chart - 6 month

Today's Close: 98.81 - 3 bps

Mortgage Rates, closest to par pricing:

30 Yr Fixed: 4.75%

15 Yr Fixed: 4.25%

5/1 ARM: 3.125%

Big Changes Coming To Mortgage Originators April 1, 2011

There are going to be big changes coming to the mortgage industry on April 1, with a complete restructuring of how fees will be charged, interest rate options for the consumer...

I was in a 1 hour webinar this afternoon with my company regarding our restructured compensation plan, and to be honest, it was the most confusing hour I've spent in a long time. As things get clarified in the next three weeks, I will update the situation accordingly.

CBO Reducing the Deficit: Spending and Revenue Options

CBO
Reducing the Deficit: Spending and Revenue Options
Link

Abstract
The Congressional Budget Office (CBO) regularly issues a compendium of budget options to help inform federal lawmakers about the implications of possible policy choices. This volume—one of several reports that CBO produces regularly for the House and Senate Committees on the Budget—presents more than 100 options for altering federal spending and revenues. Nearly all of the options would reduce federal budget deficits. The report begins with an introductory chapter that describes the current budgetary picture and the uses and limitations of this volume. Chapters 2 and 3 present options that would reduce mandatory and discretionary spending, respectively.
Chapter 4 contains options that would increase revenues from various kinds of
taxes and fees.

Summary
Federal budget deficits will total $7 trillion over the next decade if current laws remain unchanged, the Congressional Budget Office (CBO) projects. If certain policies that are scheduled to expire under current law are extended instead, deficits may be much larger. Beyond the coming decade, the aging of the U.S. population and rising health care costs will put increasing pressure on the budget. If federal debt continues to expand faster than the economy—as it has since 2007—the growth of people's income will slow, the share of federal spending devoted to paying interest on the debt will rise, and the risk of a fiscal crisis will increase.

Options for Reducing Mandatory Spending

Of the 32 options in the mandatory spending chapter:
- Fifteen deal with spending for health care programs.
- Seven would make changes to Social Security or other retirement programs.
- Ten focus on Fannie Mae, Freddie Mac, and programs that deal with education, energy, or agriculture.

Summary Link

Comments: I will have the tax summaries up from Chapter 4 for all 36 Taxing Proposals tommorow.