Wishing just doesn't make it so
Economist Greg Mankiw points out that in the White House's latest review of the Federal budget, some assumptions are made about the future growth of the economy. That's fine -- we all have to make assumptions about the future. But those assumptions presently being made are pretty astonishingly rosy -- including guesses at 4.0% real economic growth in 2014, 4.2% in 2015, 3.9% in 2016, and 3.8% in 2017, before apparently settling into a long-term stable rate of 2.5%. But Mankiw notes that those estimates for 2014 through 2016 are each about a percentage point higher than what private-sector economists are anticipating. But that's not like being 1% different -- it's like being 25% different. ■ The government has a reason to hope for those higher rates of growth, since they mean Americans will pay more in income taxes, which in turn makes long-term estimates of Federal deficits look smaller. But the private-sector economists don't have the same incentive to guess high. For many of them, getting their estimates wrong means giving bad advice to businesses and investors, who can then punish them for being wrong by firing them. ■ For an idea of just how rosy the White House estimates really are, the history of GDP growth in America shows that the last time we could expect average growth rates to top 4% was back in the 1960s. Growth rates are much milder than that today. (In fact, they've been between -3.1% and +2.4% over the last four years. Nowhere close to 4%.) No doubt we'd love to see them go back up to 4% or even 5%, if we could make that happen consistently...but wishing just doesn't make it so. ■ Real growth is going to come from much higher labor productivity and much better technology -- and given that labor productivity growth seems to be stuck around 2%, that's about as fast as we should expect to see the economy grow, barring a sudden explosion of cheap robots.
Promises of transparency go up in smoke
The much-vaunted promises of government transparency and openness under an Obama administration have turned out to be false, says a Washington Post analysis. They conclude that 10 out of 15 Cabinet-level departments are even less likely to hand over requested information now than they were two years ago.
Microsoft rolls out Outlook.com to replace Hotmail
People can continue to use their old Hotmail addresses, change them, or tack-on new Outlook.com accounts as additional addresses. The new user interface is a lot cleaner than Hotmail ever was (in fact, it's almost too clean -- it's such a blank slate that it takes a moment to get oriented), and they've built in a very useful editor for Microsoft Office documents. It's really quite good.
Amazon sells more e-books than printed copies
It's a global pheonomenon -- in Britain, the ratio of e-books to printed books sold on Amazon is now 114 to 100. In the US, e-book sales eclipsed printed copies last May. Young children may very well grow up to have peculiar understandings of what "books" are and do and look like, especially if they grow up in households that have gone all-digital.
The heat has been causing fish to suffocate
The latest flash crash shows why investors need limit orders
...and they need to watch those limit orders like hawks