Credit Spreads: Comparing COVID-19 to the Collapse of Lehman Brothers On March 18, Reuters noted something I have been following of late: Concerns about the impact of the coronavirus on corporate America’s balance sheets has tripled the premium investors are demanding to hold even the highest-rated corporate bonds. The difference between the average yield of investment-grade U.S. […]
The D Word Yes, depression, and not the psychological type, although the economic type leads to the psychological type, whether ot not it is the other way around (see Keynes’ “animal spirits). I often make fun of Robert J. Samuelson in the Washington Post, but in Washington Post today he raised the possibility that we […]
In 2020 A March Of Madness, Econospeak Just before the end of February, President Trump declared that there were only 15 Covid-19 cases in the US, and that “they will soon go to zero.” Deaths from COVID 19 now passed 3,000 (March 30th) and yesterday Trump declared that because we might have had over 2 […]
Coronavirus dashboard for April 1 by New Deal democrat Here is the update through yesterday (March 31) Over 75% of the US population is now under lockdown, and it appears to be lowering the rate of exponential growth of new infections. Based on South Korea’s experience, a ratio of 15:1 in total tests to results […]
Remdesivir and Transfer Pricing Gilead Sciences is conducting phase III trials to explore whether this treatment – which did not turn out to be effective against Ebola – might be effective in treating COVID-19. We all hope it will be and if it does pass phase III trials, national income tax authorities will later have […]
A last look at the 2009 – 2020 expansion by New Deal democrat All of the most important economic from February has been reported. Since that was the last month before coronavirus derailed everything, I thought I would take a look back and see what shape the economy was in just before the moment of […]
The Mankiw CV Plan Greg Mankiw has posted a suggestion for delivering money to people that targets the benefit to those who need it the most. The idea is clever: 1. Pay people the benefit B. (This could be spread over many weeks or months.) Everyone gets the same B. 2. Next year at tax time, […]
Weekly Indicators for March 23 – 27 at Seeking Alpha by New Deal democrat My Weekly Indicators post is up at Seeking Alpha. As you might expect, almost all of the “hard” indicators have crashed. What sticks out is that consumer spending, as measured by chain store sales, has not – even though one week […]
The Covid-19 epidemic is creating a painful dilemma for policymakers. On the one hand, we need to practice social distancing to keep people healthy and to prevent our hospitals from being overwhelmed. Unfortunately, this strategy is causing a severe economic contraction as people avoid contact with others. An ideal response to this dilemma would have […]
The USA is about to experience the largest fiscal policy shift since World War II. The House is debating whether to add $ 2,200,000,000,000 to the Federal Budget Deficit (counting loans as if they were expenses because that’s what they do). There appears to be a near consensus as all are speaking in favor. It […]