| Until about six months ago, Sweden was routinely trotted out as an example of a model economy (not least by Sweden itself). But now it's time to start talking about Swedish deflation. In March, the economy's consumer prices were down was down 0.6% from the previous March, following a -0.2% CPI inflation rate in February. CPI inflation has been hovering around zero since November 2012. The Swedish economy has been locked in an epic hawk/dove battle for more than three years. Between 2010 and 2011, the central bank increased interest rates to 2% from 0.25%. It quickly began lowering rates again in fall 2011, most recently cutting the rate to 0.75% from 1% (where it had been for a year) in December. The central bank wrote in its April report that it expects to keep rates unchanged for the next year, as "inflation has been weaker than expected for some time". The hawks, including the central bank's governor, worried if the Riksbank did not raise rates in 2010, inflation would take off. Inflation has been low for some time, yet interest rates are still high relative to the negative rates former deputy governor Lars Svensson has called for (while still at the central bank, he was a force behind its innovative negative interest rate policy back in 2009). The reason rates remain high, writes Ambrose Evans-Pritchard, is that the Riksbank "has been trying to 'lean against the wind' to curb house price rises and consumer credit, pioneering a new policy that gives weight to the dangers of asset bubbles". Alen Mattich reports that housing prices are up 70% from where they were in 2005, with rents up 30%. But the country is also dealing with a significant housing shortage, writes the WSJ. For all that Sweden is "a country with a small population but vast tracts of land", as Mattich puts it, its population is booming due to immigration, and getting new housing built in the cities is a bureaucratic nightmare. According to the WSJ, Stockholm needs 17,000 new homes a year through 2030 to keep up with population growth. Between 2000 and 2012, the city only managed to average 7,250. Svensson, who was so fed up with the Riksbank's hawkishness he quit last April, writes that "the Swedish housing market seems robust and not fragile, in contrast to a bubble". He has been warning of deflation from the bank's tight monetary policy since 2010. Deflation dwarfs housing prices and household debt on the list of Swedish economic problems, he says. Paul Krugman agrees, calling Sweden "an object lesson in the power of sadomonetarism". — Shane Ferro On to today's links: Yikes
Class, risk, and regulation at 18,000 feet - Jon Krakauer New Normal
Get rich or die younger: the shrinking lifespans of poor US women - WSJ Please Update Your Records
Wind turbines are "the smallest threat to birds worthy of mention" - Bloomberg Primary Sources
"There's no technological reason for you to have 10,000 dimesized antenna": the Aereo oral arguments - Supreme Court EU Mess
"EU institutions have become instruments for creditors to impose their will on debtors" - Philippe Legrain Governance
Citi renews its commitment to shareholder engagement by holding its annual meeting in St Louis with no webcast - Matt Zeitlin USA! USA!
Americans think owning a home is better for them than it is - Catherine Rampell
The rich like to invest in real estate and stocks; the poor prefer gold - Barry Ritholtz
The American middle class is no longer the world's richest - David Leonhardt and Kevin Quealy Regulations
JPGoldman Stanley intact: Basel eases counterparty limits - Bloomberg Real Talk
It's not PowerPoint's fault you are boring - Lisa Pollack Takedowns
Fun with arbitrary numbers: the trouble with measuring the speed of tech adoption - Gizmodo Bad Data
"The crimes reported there were real, but they actually happened somewhere else" - LAT Servicey
"Global megacities owe you nothing. Never forget that" - Conor Sen Journalism 3.0
"Looking for Satoshi Nakamoto is how I procrastinate instead of playing 2048" - Adrian Chen | 
