By Spencer Yesterday’s bond market reaction to the Fed’s policy announcement was interesting.

By Spencer In the industrial production report this morning February manufacturing output was reported to drop 0.8%. On the surface this looks bearish. But hours worked in manufacturing also fell 2.0% in February. Consequently, manufacturing productivity rose 1.2% in February. The smoothed three month growth rate of estimated productivity is 0.1% and the year over […]

By Spencer Madoff is awaiting sentencing. It is a reasonable trade-off, 30 to 40 years of life as a multi-billionaire for spending the last 10-15 years of your life in a federal prison. Maybe what the Judge should do is not than sentence him to federal prison.. Rather what he should tell Madoff is that […]

By Spencer, It is interesting how today’s report on nominal retail sales is being ignored almost across the board among the economic bloggers. January and February retail sales are above the December low. The three month moving average is still below the December moving average, but if the March report is decent the very low […]

By Spencer Required reading: Christina D. Romer of the Council of Economic Advisers Lessons from the Great Depression for Economic Recovery in 2009 I really like her comments on gold, treasury operations and money supply. (hat tip Greg Mankiw)

By Spencer With the unemployment rate jumping to 8.1% and downward revisions of the previous monthsemployment numbers it is hard to find anything encouraging in the February employment report. But there is one tentative good sign. I watch both the payroll and households surveys because the household survey tends to lead the payroll report at […]

By Spencer The Conference Board Index of Consumer Confidence fell to an all time low of 25 in February– 1985=100.. While many economist debate about the how much of a leading indicator consumer confidence is,I find it to be a very good concurrent indicator. I use it to model real retail sales and have long […]

By Spencer, In the 1990s Greg Mankiw said that the Clinton tax increases would cause a major recession. In fact, the tax increases were followed by a major boom. In the early 2000s Greg Mankiw said the Bush tax cuts would cause an economic boom. In fact, the tax cut was followed by the weakest […]

By Spencer, Earlier I showed how the sharp drop in industrial production compared to other cycles, but did not point out that the factory operating rate moved down 1.7 percentage points, to 68.0 percent, the lowest rate of utilization since this series began in 1948. Normally, capacity utilization leads inflation and this implies weshould see […]

By Spencer. The drop in industrial production is approaching the worse in the post WW II era. The index with 100= peak current ….90.11957-58…86.61974-75…87.01981-82…90.6 So only the 1958 and 1974 industrial production declines are more severe than the current downturn.