Category / Federal Reserve

by Hoosier Econ

2015 NFL Free Agency: $1.5 Billion in Contracts Signed by Players

suh dolphins
NFL free agency kicked off on Tuesday March 10th. Numerous players either stayed or left their teams in pursuit of greener pastures. How much in contracts were signed this past week? Sportrac.com has a system set up tracking these numbers and here is the breakdown from studying the signings.

– Over 100 free agents signed

– Average length of contracts is 3 years

– Total amount of all contracts signed (disclosed/undisclosed) tops over $1.5 Billion

– Total amount of guaranteed money NFL teams must pay is $634 Million. The top five contracts account for $170.9 Million of that.

NFL contracts almost never get fully paid out. Each year these contracts are reworked, players cut, retirement or clauses are invoked terminating the amounts paid. Guaranteed money is paid out in full barring any contract clauses not met.

by Hoosier Econ

States Tax Revenue Still Down

Cancel out the noise of propagandist who continually say the economy is booming and follow the data. Wall Street Journal shows compelling data of states tax revenue is in bad shape as spending increases. Here is what the Wall Street Journal found:

There are 30 states still collecting less in taxes, adjusted for inflation, than when the recession hit, according to a Pew Charitable Trusts study that examined the data through September. Income-tax collections grew on a real basis by 7.1% since late 2008, while sales-tax receipts rose by 1%, according to an analysis by Nelson A. Rockefeller Institute of Government at the State University of New York.

state tax revenue
Government employment is actually down on the state level. Most of the attrition is probably attributed to from an aging workforce i.e. retirement:

State and local governments are employing 620,000 fewer people than they did six years ago. New municipal-bond sales stand at a more-than-15-year low as states remain hesitant to start public works and other capital projects.

If anyone tells you all you have to do is magically raise taxes and all ills are solved, they are terribly wrong.

Coming out of the recession, several states raised sales-tax rates to make up for deep revenue drops. In Arizona, a sales-tax increase was only temporary, meant to serve as a three-year bridge until collections returned. Still, total tax revenues as of the third quarter of last year remained 10% below their prerecession levels on an inflation-adjusted basis, according to the Pew analysis.

You can read the rest of the Wall Street Journal article here.

by Hoosier Econ

How Americans Will Spend Their Tax Refund

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American Morning News interviewed Kay Bell from BankRate.com explaining a survey they with 1,003 adults and how they will spend their tax refund. USA Today posted the survey and here is how it broke down:

34% say they’ll use it to pay down debt

33% say they’ll save or invest the money

26% say they spend the extra cash on necessities such as food and utility bills

3% want to use it to live it up and go on vacation or a shopping spree

Here is another snapshot of Americans thinking on income taxes/tax refunds that would make Dave Ramsey shake his head at:

Some people view having extra money withheld from their paychecks for income tax as a way to save, says Bankrate.com tax analyst Kay Bell. But she advises against it because “the bank of Uncle Sam” pays no interest.

The rest of the article is here and has some more good stats obtained by the survey.

by Hoosier Econ

How Much Money Goes Into March Madness Bracket Pools?

march madness
Tis the season where millions of Americans take a gamble in starting to fill out their NCAA tournament brackets. Men and women will take out their wallets and throw down some money to enter in a pool with other in the hope they make some easy money in applying their college basketball knowledge. How much money do Americans spend during this time of year? It’s very hard to estimate since 90% of all NCAA tournament gambling is off the books. But lets take a look at some history to guage this sports investing event.

In 1999 there was a report issued by then President Bill Clinton:

National Gambling Impact Study Commission, formed by President Clinton, released a 1999 report citing surveys showing that well over 90 percent of all sports betting nationwide takes place off the books. If accurate, that would push the total wagered on the NCAAs across the country closer to $1 billion.

Fast forward to 2014 where more data can be evaluated yet is still a rough estimate, one sports investing website gave this estimate:

The site Pregame.com estimates that wagering on this year’s March Madness tournament will exceed $12 billion, more money than was riding on the Super Bowl. Of that, $3 billion will be put into office pools of tournament brackets.

Comparing those two estimates, NCAA Tournament betting has exploded 1100% in America. Good luck with your tournament pools this year.

H/T The Fiscal Times and BetFirm.com

by Hoosier Econ

U.S. Government Hits Debt Limit on March 16th

government

United States Government spends so much money these days that the debt is reaching its ceiling again. Do not expect Republicans put much of a fight up in stopping any raises as they usually join Democrats in governments spending addiction.

Via CNBC –

Unless Congress takes action, the U.S. will hit its debt limit on Mar. 16, but would begin taking “extraordinary measures” to finance the government on a temporary basis, according to the U.S. Treasury.
In a Friday morning letter to House Speaker John Boehner and other House and Senate leaders, Treasury Secretary Jack Lew said that his office will be forced to suspend the issuance of State and Local Government Series securities on Mar. 13 unless the debt limit is raised.

“Accordingly, I respectfully ask Congress to raise the debt limit as soon as possible,” Lew wrote in his letter.

The Congressional Budget Office said this week that if Congress does not raise the federal debt limit, the Treasury Department will exhaust all of its borrowing capacity and run out of cash in October or November, slightly later than a previous forecast.

by Hoosier Econ

U.S. Healthcare Spending Has Risen

Dr. Ed Yardeni has put together a post showing the consumer has saved dollars YTD on gasoline prices, the savings is being eaten up by higher medical expenses.
healthcare spending

Last week, I observed that while consumers are spending less of their budgets on gasoline, they are spending more on health care. The latest data through January show that the percentage of current-dollar consumption for gasoline plunged from last year’s high of 3.2% to 2.1% in January. Consumers saved $133 billion (saar) on gasoline over this period.

On the other hand, the percentage of their outlays for health care goods and services rose from last year’s low of 20.0% during March to 20.6% during January. I received lots of inquiries about this topic. Most readers want to know if this is attributable to Obamacare, which seems to have raised health insurance premiums, deductibles, and copays. I think so, but I don’t have the data to corroborate this conjecture.

Health care consumption includes spending paid for by both insurance and government programs, as well as out-of-pocket costs. Presumably and anecdotally, the latter have risen sharply. However, that wouldn’t necessarily bloat overall spending, though more out-of-pocket outlays would depress spending on other goods and services.

by Hoosier Econ

Vegas Sets 2014 Sports Gambling Records

The numbers are in and sports investing broke records in 2014 for betting revenue. ESPN supplied the breakdown:

The state’s 187 sportsbooks won $227.04 million off of the $3.9 billion wagered on sports in 2014. Both amounts are all-time records, according to Nevada Gaming Control.

Football, per usual, carried the load. The sportsbooks won $113.73 million on college and pro football in 2014, a giant 40.73 percent increase from 2013. Overall, $1.74 billion was bet on football in 2014, $12 million more than in 2013. Nevada Gaming Control does not track pro and college football separately, but sportsbook managers estimate the NFL accounts for around 55-60 percent of their annual football handle. From September through December, the books are up $98.16 million on football.

In comparison, the books won $54.2 million on basketball and $21.2 million on baseball in 2014. Both numbers were down, 8.36 percent and 26.88 percent, respectively, from 2013.

by Hoosier Econ

Another Drop in Oil Rig Production

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Baker Hughes is showing another 43 oil rigs taken out of production which means it now has passed the “500 Mark” of rigs out of production. The total count of rigs out of production compared to this time last year now stands at 502.

by Hoosier Econ

Price of Cell Phone in 1987

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by Hoosier Econ

Employment Opportunity: Checking Poop

doctor glove
Via Washington Times –

The federal government is looking for doctors to help monitor suspected smugglers’ bowel movements at John F. Kennedy International Airport in New York, in a solicitation that sounds like it could be something out of the Discovery Channel’s “Dirty Jobs” program.

Doctors must be available round-the-clock in case CBP officers suspect they have a “swallower,” which is what internal drug smugglers are known as. The doctors are charged with X-raying or otherwise examining suspects’ body cavities, and if drugs are found, the work order says “the detainee may be held for a monitored bowel movement (MBM) to wait the passage of the contraband material.”

“CBP regularly intercepts individuals who ingest wrapped packets of illicit drugs such as cocaine, heroin, amphetamines, ecstasy, marijuana or hashish to transport them,” the agency said. “CBP officers apply their keen knowledge, expertise and intelligence to detect and intercept suspected body cavity concealers at our nation’s ports of entry.”

CBP identified 176 “body cavity concealment incidents” in 2014, which was down from 187 the previous year.


You can read the rest here.