Recently there has been a claim that corporations are holding large sums of cash rather than investing it because they are fearful of Obama’s “socialist policies”. But if you compare corporate retained earnings to the GDP GAP lagged one year it looks like the debate should be over why corporations are investing so much. This […]

CoRev asks if anyone wants to discuss the justifications of the beneficiaries of the different parties policies. So I though this gives me an opportunity to present some recently publishedCBO data on income and tax that could give people something to tie the discussion to. Republican policy has been to favor the more affluent in […]

The employment report was bad, as private payroll employment only rose 83,000. Moreover, the household survey showed a drop in employment of -350,000. The unemployment rate fell. But that is because the – 350,000 fall in household survey was offset by a -652,000 drop in the labor force. A labor force contraction is really bad […]

In Linda’s post on the budget deficit in the comments it was claimed that the budget deficit was Obama’s fault and a chart was cited that showed the deficit in someone’s estimate of real dollars. The standard way of comparing deficits across time and across different countries is to show the deficit — past and […]

The economic headline this morning is that China has agreed to allow the yuan to appreciate. The announcement is being credited with about a 1% higher opening for the stock market and numerous pundits are claiming this will make a significant difference. But this has happened before and it had little impact. From 2004 to […]

Did others notice that year-to-date inflation, as measured by the CPI, is zero?

Industrial production and housing starts were reported today. It has been well covered elsewhere, but I though I would make a couple of comments. Compared to other cycles this recovery in industrial production continues to be moderate. It is stronger than in the weak recoveries, but compared to the depth of the downturns the rebound […]

Late last month there was a debate among several bloggers over an article by Scott Sumner over US growth after the Reagan revolution. In the debate it was suggested that it would behelpful to do the analysis by looking at the various components of GDP–consumption, investment, government and trade . I was sidetracked on other […]

The employment report was basically more of the same and was very discouraging.Even though the headline number reported a large 431,00 increase in employment, most of this was temporary Census jobs. Private employment only increased 41,000, significantly less than in the previous few months. The unemployment rate fell, but that was just as much a […]

Which view of the stock market to you take? On the one hand there is the fundamental interest rate, inflation approach. It says that the market overreacted to the two shocks of Greece and Deepwater Horizon and is now cheap.The S&P 500 PE on trailing operating earnings is now 16.5, and according to the traditional […]