Allen, Kyle D. and Griffiths, Mark D. and Hein, Scott E. and Winters, Drew B., Why Is the Effective Fed Funds Rate So Low? (April 16, 2014). Available at SSRN: http://ssrn.com/abstract=2425913

“Since December 18, 2008 when the Federal Reserve began paying 25 basis points (bps) on depository institution’s reserves, the effective federal funds rate has stayed well below 25 bps, on occasion by as much as fifteen bps. This suggests the possibility of an arbitrage opportunity. The purpose of this paper is to offer an explanation of this ongoing situation. Part of the explanation starts with the recognition that certain financial participants in the federal funds market cannot earn the 25 bps. This paper further explains other limits to arbitrage arguing that the anomaly persists, in part, due to costs associated with the Federal Deposit Insurance Corporation (FDIC) assessment on the liabilities of depository institutions and capital charges. The difference in these two interest rates also is found to increase with the Federal Reserve’s bank reserve creation associated with the quantitative easing programs.”

Graham, John R. and Leary, Mark T. and Roberts, Michael R., How Does Government Borrowing Affect Corporate Financing and Investment? (April 16, 2014). Available at SSRN: http://ssrn.com/abstract=2425916

“Using a novel dataset of accounting and market information that spans most publicly traded nonfinancial firms over the last century, we find an economically large and robust negative relation between U.S. federal government debt and corporate debt and investment. A one standard deviation increase in Treasury debt is associated with a one third standard deviation reduction in corporate debt issuances, no significant change in corporate equity issuances, and a one third standard deviation reduction in corporate investment. These relations are more pronounced in larger, less risky firms whose debt is a closer substitute for Treasuries. The channel through which this effect operates is financial intermediaries, whose asset portfolios reveal a substitution between federal government debt and corporate debt. The relations between government debt and corporate policies, as well as the substitution between government and corporate debt by intermediaries, are stronger after 1970 when foreign demand increased competition for Treasury securities. In concert, our results suggest that large, financially healthy corporations act as liquidity providers by supplying relatively safe securities to investors when alternatives are in short supply, and that this financial strategy influences firms’ capital structures and investment policies.”

 

The Wage Gap, State by State

April 18, 2014

 National Women’s Law Center: ”Families depend on women’s wages more than ever, but the typical woman working full time, year round is paid less than the typical full-time, year-round male worker. These disparities exist in every state. However, as indicated in the map below, the size of the disparity varies by state. Additionally, women represent nearly […]

Read the full article →

New GAO Reports: Maritime Infrastructure, Medicare Imaging Accreditation, Nuclear Weapons

April 18, 2014

MARITIME INFRASTRUCTURE: Key Issues Related to Commercial Activity in the U.S. Arctic over the Next Decade, GAO-14-299: Published: Mar 19, 2014. Publicly Released: Apr 18, 2014. MEDICARE IMAGING ACCREDITATION: Effect on Access to Advanced Diagnostic Imaging Is Unclear amid Other Policy Changes, GAO-14-378: Published: Apr 18, 2014. Publicly Released: Apr 18, 2014. NUCLEAR WEAPONS: Technology Development Efforts for the Uranium Processing Facility, GAO-14-295: […]

Read the full article →

Coalition Urges White House to Recognize EU Opinion; End NSA Telephone Records Program

April 18, 2014

“In a letter to the White House, a coalition of US organizations urged the Administration to recognize the recent opinion by the Court of Justice, the highest court in Europe, that ended a European data retention mandate. The European law required telephone and internet companies to retain metadata on customers for national security purposes. The European Court of Justice […]

Read the full article →

U.S. Foreign Aid to Israel

April 18, 2014

CRS - U.S. Foreign Aid to Israel - Jeremy M. Sharp, Specialist in Middle Eastern Affairs, April 11, 2014 “This report provides an overview of U.S. foreign assistance to Israel. It includes a review of past aid programs, data on annual assistance, and an analysis of current issues. For general information on Israel, see CRS Report RL33476, Israel: Background and […]

Read the full article →

How Americans Die – Bloomberg Data Visualization Report

April 18, 2014

How Americans Die, Matthew C. Klein, Bloomberg View, April 17, 2014

Read the full article →

Pew – U.S. Views of Technology and the Future

April 17, 2014

Science in the next 50 years, by Aaron Smith: “The American public anticipates that the coming half-century will be a period of profound scientific change, as inventions that were once confined to the realm of science fiction come into common usage. This is among the main findings of a new national survey by The Pew Research […]

Read the full article →

EPIC Obtains Documents About FTC’s Facebook Investigation

April 17, 2014

“As the result of a Freedom of Information Act request, EPIC has received several hundred pages of documents related to the Federal Trade Commission’s investigation of Facebook business practices. The documents include assessments by the FTC of Facebook’s privacy changes and communications with the company. EPIC has repeatedly pressed the Commission to enforce the 2012 Consent Order which barred the company from future […]

Read the full article →

Out-of-Pocket Net Price for College

April 17, 2014

“This Data Point uses data from four administrations of the National Postsecondary Student Aid Study (NPSAS:2000, NPSAS:04, NPSAS:08, and NPSAS:12) to briefly present trends in out-of-pocket net price for college, the amount that students and their families must pay to attend college after subtracting grants, loans, work-study, and all other student aid from the total […]

Read the full article →

Report – Street View and reCAPTCHA technology just got smarter

April 17, 2014

Vinay Shet, Product Manager, reCAPTCHA: “Have you ever wondered how Google Maps knows the exact location of your neighborhood coffee shop? Or of the hotel you’re staying at next month? Translating a street address to an exact location on a map is harder than it seems. To take on this challenge and make Google Maps […]

Read the full article →

New GAO Reports – Information Security at the SEC, IRS and Large Partnerships

April 17, 2014

INFORMATION SECURITY: SEC Needs to Improve Controls over Financial Systems and Data, GAO-14-419: Published: Apr 17, 2014. Publicly Released: Apr 17, 2014: “Although the Securities and Exchange Commission (SEC) had implemented and made progress in strengthening information security controls, weaknesses limited their effectiveness in protecting the confidentiality, integrity, and availability of a key financial system. For this system’s […]

Read the full article →