There's a complex relationship between the condition of the nation's capital markets and its macroeconomic performance. Equally complex is the parallel relationship between monetary policy set by the Fed the via interest rates and money supply and the far broader distributive fiscal policy options at the disposal of lawmakers. The past month's heavy losses among big, institutional investors coming at a time when the GDP has been contracting over the last couple of quarters are generating a spate of thought and opinion about this relationship.

A popular topic of discussion among the budget folk here at OMB Watch is the mystery of President Bush's veto threats, which he's made against just about every remotely progressive piece of legislation being considered by Congress. His party just lost an election, and President Nixon was better liked. Where does he get off trying to stymie Congress?

Walter Pincus had a story last weekend about a huge new batch of contracts being issued by the Defense Intelligence Agency (DIA)- the Pentagon's not-so-mini CIA. Definitely worth a read, but before you do, take a look at this June article in Salon.com about intelligence agencies and their increasing use of contractors.

The always-edifying David Cay Johnston writes about the latest income data from IRS: Americans earned a smaller average income in 2005 than in 2000, the fifth consecutive year that they had to make ends meet with less money than at the peak of the last economic expansion, new government data shows.