Scenes from the May employment report: expect more lackluster reports, and layoffs in manufacturing Three months ago when the poor February jobs report came out, I was just about the only commentator who saw it as a harbinger rather than an outlier. On Friday the naysayers got silenced.Let’s see how the more leading aspects of the employment […]
May jobs report: this is the kind of report you see at negative inflection points HEADLINES: +75,000 jobs added U3 unemployment rate unchanged at 3.6% U6 underemployment rate declined -0.2% from 7.3% to 7.1% (new expansion low) Leading employment indicators of a slowdown or recession I am highlighting these because many leading indicators overall […]
CORE and Periphery in the Reform of Econ 101 Thanks to Greg Mankiw, I’ve seen a preview of the piece by Sam Bowles and Wendy Carlin that will be published in a forthcoming Journal of Economic Literature. It’s apparently part of a roundtable on the teaching of introductory economics, and not surprisingly Bowles and Carlin focus on the freely […]
A Bernie Sanders Narrative for Seniors What follows is some unsolicited advice for the Sanders campaign. Politico has an important piece on the downside of the extraordinary age bias in Sanders’ support. Like a teeter totter, the large advantage Sanders enjoys among younger voters is counterbalanced by his dismal showing among the older crowd. The article […]
A Very Erroneous Chart in the Economic Report of the President Menzie Chinn has been reading the latest Economic Report of the President and finds a very erroneous and misleading chart, which is figure 1-6 from this this document (see page 45), which states: Equipment investment, in particular, exhibited a pronounced spike in the fourth quarter of 2017, […]
Tariffs and Monetary Policy: Moral Hazard and Rent Seeking President Trump’s threat to impose tariffs on Mexico over immigration has pushed Federal Reserve Chair Jay Powell to say that if the tariffs lead to economic growth slowing, the Fed will cut interest rates. While the bump may be about to end, this announcement was followed […]
ISM manufacturing and residential construction spending trends continue May data has started out where April left off, with continuations of trends in both manufacturing and construction. First, manufacturing: it is still expanding, but at a much lower rate than last summer’s red hot numbers. The overall ISM manufacturing index declined a bit to 52.1, but […]
From Brad. My bold To Franklin Delano Roosevelt, 1 February 1938 Private and personal Dear Mr. President, You received me kindly when I visited you some three years ago that I make bold to send you some bird’s eye impressions which I have formed as to the business position in the United States. You will […]
The sources of the next recession While we are waiting for the ISM May manufacturing survey and construction spending data to be released later this morning, both of which will give us important clues to Friday’s jobs report, let me write down some thoughts on the nerdy question I ruminated about this weekend: what is […]
by Joseph Joyce The Rise and Fall of FDI After the global financial crisis, international capital flows contracted, especially bank lending in Europe. Foreign direct investment (FDI) by multinational firms, however, provided a steady source of external finance, particularly for emerging market economies. The McKinsey Global Institute has calculated that the global stock of FDI increased from […]