Is the Current Long US Interest Rate too Low?

I do not know, but it certainty can be if you believe the US will experience a decade similar to that of the 2000s in Japan.
On 1/4/2000, the Japanese 10yr yield is 1.743%. The 20yr yield is 2.164%.  Approximately 10 years later – on 1/4/2010, the 10yr year for Japan is 1.322%. From the reference here, I think these are constant maturity yield estimated using a fitted curve on semiannual compound interest rate. So, the annualized continuous compound rates are:

10yr, 2000: 1.735449 = 2*ln((1.743/2)+1)
20yr, 2000: 2.385714 = 2*ln((2.4/2)+1)
10yr, 2010: 1.31765 = 2*ln((1.322/2)+1)

Using the standard forward rate formula to calculate the 10yr rate 10 years ahead:

3.0359797 = (20*2.385714 – 10*1.735449) / (20 – 10)

In other words, in 2000, the prices from the Japanese Government Bonds suggest that the expected 10yr rate in 2010 would be 3.04%. And if in 2000 someone in Japan asks the future me (who has perfect foresight) if I think the long interest rates are too low, I would say no.
Point being – that long rates can stay low for a long time. If the future in the US is anything like that of Japan, rate might not be low at all. Note also that the 10yr rate in Japan in 2000 is *higher* than the 10yr rate in Japan in 2010.
On 8/16/2011, the 10yr US interest rate is 2.23%, and 20yr rate is 3.23%.
Reference: Interest Rate (Q&A), Interest Rate  [Ministry of Finance],
  Daily Treasury Yield Curve Rates [US Department of the Treasury]

Announcement Effects of FOMC, August 2011

The latest FOMC statement on August 9 announced the following:

The Committee currently anticipates that economic conditions--including low rates of resource utilization and a subdued outlook for inflation over the medium run--are likely to warrant exceptionally low levels for the federal funds rate at least through mid-2013.

The statement reduces the chance of an increase in federal funds rate to nearly zero until mid-2013. Note that the statement does not constraint the committee from raising rates should rates of resource utilization increase or outlook for inflation becomes increasingly likely. However, barring any significant changes, it does eliminate talks of inflation in the current environment by some in the committee.

The figure below shows the yield curve from the US Treasury Department shows the yield curve between the day before the FOMC announcement and August 16. The 30yr yield has recovered from the drop last week. However, much of the yield curve is still depressed from last week, and I would expect the short end (correspond to until mid-2013 or a little less than 2 years as of now) to stay depress for some time.

The quick recovery of the 30yr yield also highlights the difficulty in interpreting effects of policy on long Treasury yields. Was the drop last week an overreaction? Were there events from last week to this week that lead to the increase in yield, independent of the effect on yields from the FOMC statement last week?  Depending on one or the other, the FOMC action can be interpreted either as having no persistent effects on the long rate or as having persistent effects. The longer the maturity, the more things can influence its movements.

Reference: Daily Treasury Yield Curve Rates [US Department of the Treasury]

Direct Links to FRED Data Graphs

To get the graph similar to the one Paul Kurgman posted on his NY Times opinion page about the output gap on August 11, use the following URL:

http://research.stlouisfed.org/fred2/graph/fredgraph.png?&id=GDP,NGDPPOT&scale=Left,Left&range=Custom,Custom&cosd=2005-01-01,2005-01-01&coed=2011-04-01,2012-12-31&line_color=%230000ff,%23ff0000&link_values=false,false&line_style=Solid,Solid&mark_type=NONE,NONE&mw=4,4&lw=1,1&ost=-99999,-99999&oet=99999,99999&mma=0,0&fml=a,a&fq=Annual,Annual&fam=avg,eop&fgst=lin,lin&transformation=lin,lin

The St. Louis Federal Reserve FRED website can generate graphs from the data, and the website accepts what is called POST requests. As you can see from the URL, the website just pass along all the possible options to a program that generate the graph and return that to you.

The benefit of figuring this out is then you can automate your computer to email you updates of the output gap. For me, I use an old laptop running Linux, and write a script to retrieve the picture using wget and then email it to me using Mutt. For people with Windows machines, you can do it in a batch file and schedule it using the Windows Task Scheduler. You can use the Windows version of wget to download the graph. However, I do not know of a good program to use to email yourself the graph using a batch file (perhaps Windows version of Mutt or Pine can do this).

Here, I set the option to do annual. You can do quarterly by changing “&fq=Annual,Annual&” to “&fq=Quarterly,Quarterly&”

Reference: The Waste [NYTimes.com]

MATLAB Error: “Name is nonexistent or not a directory”

You can add additional default paths to MATLAB using the “Set Path…” option under the File pull-down menu. This way, you can put utilities (your own .m files) you have written all in one place and have MATLAB access run them by just typing the script like – just as if they are in the current directory.

However, if you delete a file directory referenced by these paths – MATLAB will give you an error, but *not* allow you to delete it through the “Set Path…” dialog box. But when you start MATLAB, it will always give you the following error message:

Warning: Name is nonexistent or not a directory:

To delete the path, run “edit pathdef.m” and delete the reference to the deleted path. MATLAB checks this file when it starts and setup all the paths that it should check if it does not find the .m file in the current directly.

Reference: Why do I receive the warning message "Warning: Name is nonexistent or not a directory: .... " when I start MATLAB? [MATLAB & Simulink]

How to Combine CSV Files Quickly in Windows

In Microsoft Windows’s command prompt:

copy /a *.csv alldata.csv

Reference: Keyboard Ninja: Concatenate Multiple Text Files in Windows [How-To Geek]