Relevant and even prescient commentary on news, politics and the economy.

A Bleg – Private Consumption Multiplier

from Mike Kimel Hi. For a project I’m working on, I need to find estimates of a private consumption multiplier. That is to say, the multiplier resulting from changes in private consumption rather than, say, from changes in gov’t spending or taxation. Any pointers? Please let me know in comments are by email (mike period […]

It’s not the tax and spending cuts, it’s the destroyed trust that has doomed our economy

By Daniel Becker In the comments to my post “A reminder from Obama’s February 2009 speech”, there is the following: “I guess it relates to the fake Obama they had made up in their heads,…”  This sums up the early comments to the post suggesting that those who trusted Obama have only themselves to blame. […]

The Q2 US GDP report – just terrible

Bureau of Economic Analysis today reported that real gross domestic product in the US increased at an annual rate of 1.3% in the second quarter of 2011. This (newly revised – see below) acceleration in real GDP was driven primarily by a slowdown in import demand, stronger federal spending, and a pickup in non-residential fixed […]

Small Business=Fraud, Countercyclical Planning, MMT, and Other Economics Catch-up

Note:This was going to be short pieces about things I missed during a week of illness. It turned into a Very Long Piece riffing on two posts from Capital Gains and Games. And that’s without even mentioning the bravura work Stan Collender is doing there: see, for instance, this note that a deficit reduction bill […]

GDP – a disappointing report

Yesterday I addressed the weak high-frequency indicators, specifically with respect to leading indicators of investment spending on equipment and software (durable goods). I argued that Q2 has not started off well, given that the real core orders for capital goods are down compared to the January to March average. The BEA reported that Q1 2011 […]

Durable goods orders: more evidence of near-term weakness in the US economy

They keep calling it a ‘soft patch’ in my business; but when’s the data going to show otherwise? This soft patch is persistent, and durable goods orders confirm it into Q2 2011. Note: The ‘all manufacturing’ orders Y/Y growth rate are available through March only in Datastream for the chart above; the nondefense capital goods […]

The other measure of income, GDI, shows faster growth and an oversized profit contribution

There are two measures of income: the spending side (Gross Domestic Product, or GDP) and the income side (Gross Domestic Income, GDI). I’d like to see what GDI is telling us about the Y/Y recovery, since it’s a better predictor of turning points, according to FRB economist Jeremy J. Nalewaik. The chart illustrates the contribution […]

Math is Math: There Was No "Second Stimulus"

One of the best rules in mathematics is that, to determine the value of all the variables, you need only as many distinct equations as you have variables. (previous sentence edited for clarity.) So let’s combine a couple of recent articles (h/t Mark Thoma for the first, Digby for the second.) Richard Florida finds three […]

A worthy debate

Econospeak’s Peter Dorman has an excellent debate going on with Sandwichman and cian, among others, about using GDP as a main measure of a healthy economy, the components of growing the economy, and the state of mainstream political economic discourse. We have touched on related issues on Angry Bear. Our own Rusty puts the question […]