Links of the day

Jerry Marks says of the Detroit automakers: "And what makes the more recent problems at Ford, GM (GM) and Chrysler (DCX) so concerning, is that I am unaware of any time in the history of the industry when turnaround plans were underway at all three major automakers at the same time despite having been through 8+ years of near record vehicle sales and sub 5%/6% unemployment rates"...

Why the Fed won't be cutting rates anytime soon..."The Labor Department... reported the number of people collecting unemployment fell by 25,000 to 2.49 million, the lowest its been in 10 weeks. According to Cary Leahey, senior economist at Decision Economics Inc., "The labor market remains tight. If people want a job they can find a job. As long as that remains the case, consumer spending ought to be pretty good"...

Cabela’s Incorporated: New Initiatives Should Improve Efficiencies...an analysis of one of my favorite companies of all time (they are an outdoor retailer)...one of their biggest assets is that their physical stores are as much amusement parks as merely stores...the store that was built near my home in Lehi, UT has a giant fish tank where you can drool over giant trout and bass swimming around, a shooting gallery, and displays of trophy big game...

Worthwhile Canadian Initiative has an analysis of "why labour's share of income has been decreasing over the past couple of decades": the answer being that "One of the implications of an aging population is an increase in the percent of people who are retired. If at least part of their retirement is financed out of accumulated savings, you'd expect that capital would generate a larger share of total income - which means that the labour share would have to fall"...I agree with that 100%...

Corruption in the world of college financial aid...thanks to Daniel Gross for the pointer to a NY Times article that documents how directors of financial aid at several well-known universities "held shares in a student loan company that each of the universities recommends to student borrowers, and in at least two cases profited handsomely." One more quote:

"The revelations that financial aid administrators had investments in a student loan company come as state and federal lawmakers have stepped up their scrutiny of incentives that loan companies offer to curry favor with universities as tuitions — and student debt — rise. Last year, according to the College Board, students took out $85 billion in loans. Students rarely comparison shop and often rely on the preferred lenders list recommended by universities to take out a loan. Sometimes, only a handful of companies make the list.

“There’s an implicit assumption that the financial aid office is an impartial, informed intermediary,” said Michael Dannenberg, director of education policy at the New America Foundation, a public policy institute in Washington. “What we’re finding out now is that some colleges and some financial aid administrators may not be so impartial.”

Changing Mexican Demographics and Illegal Immigration...Economist's View points to an LA Times article that states that "Mexico is undergoing a demographic transition. According to the Mexican census bureau, long gone are the days of families with six, seven or 10 kids. Instead, Mexican women now average 2.2 births — only slightly above the average 2.1 births that occur in the United States and that are considered the "replacement rate,"... Life expectancy in Mexico has increased to 75 years, compared to 77 in the United States. ... In short, Mexico is about to age dramatically"...the result will be that the flow of illegal immigrants is likely to drop off sharply...where will the farmers get their laborers then?