Economic Notes



Soaking up information and talk on my Pittsburgh/western PA visit, I can report that some real estate activity has picked up, but largely due to refinancing when rates bottomed out. Now people are starting to worry about inflation, due to the influx of federal money.


But Paul Krugman makes a persuasive case that stimulus must continue in his ironically titled column "Stay the Course" (think Bush and Iraq.) The column, which appeared Monday, says that inflation isn't going to rise a lot, because the influx of federal government money simply replaced the private money that wasn't there. And indeed, today's news is that inflation in May was below expectations. He also warns that stopping stimulus too soon is exactly why the Great Depression didn't end sooner, and Japan had such a dismal 90s.

Back in CA, things are grim. State government went begging to Washington and for now, got turned down, but this article sets out some of the stakes. Meanwhile, faculty at HSU were told to expect what amounts to a 12% pay cut. Twelve percent! And that's just the beginning.

City of Champions (and Lakers) Continued

Pittsburgh continue to celebrate, with an especially close bond between the Penguins hockey players and their most devoted fans on the South Side, where players and coaches partied and once again shut down Carson Street when fans gathered to be part of it. Penguin stars also appeared at the Pittsburgh Pirates baseball game, sharing in the celebration of the first Pirates World Series win in 1906 against the Detroit Tigers, who were in town. (I wouldn't want to be from Detroit today, since Detroit lost the Cup, they lost that 1906 World Series, and today they lost the game.)

Tomorrow the craziness reaches its apex, as the official parade for the Penguins is held downtown. Some streets will be closed as earlly as 2:30 am for the parade at noon. Anyone going to Pittsburgh tomorrow for any other purpose may well never get there.

But tonight, Pittsburgh is ignoring what I was watching, which was the fifth and final game of the NBA Finals. A 16-0 run in the second quarter pretty much decided it, as the Lakers won with a dominant team performance, including some highlight reel shots--probably one that makes his all-time highlight reel--by Kobe Bryant. Bryant is by all accounts still clearly the best player in the game, and this accomplishment added to his status in basketball. After the Lakers lost in the finals last year, Bryant kept playing, leading the U.S. team to an Olympic gold medal, and then right into this championship season. He won the MVP for the finals.

Update 6/16: The victory parade for the Penguins in Pittsburgh drew an estimated 375,000 people on a sunny day. The local media is chortling over the efficiency and lack of real trouble over the celebratory events of the past few days, in contrast to the destruction and looting in Los Angeles after the Lakers win.