One wants to read little into a monthly jobs report and even less–much less–into a day in the equity markets. But I found it interesting that the stock market reacted uncharacteristically positively to today’s solid jobs report. Over at the NYT Economix blog.
So ruled the judge, paving the way for the largest municipal bankruptcy in our nation’s history. Detroit’s liabilities are estimated at $18 billion with a ‘b.’ The next largest city bankruptcy was San Bernardino, CA, in 2012 with a debt level of $46 million…with an ‘m.’ Another important part of the judge’s ruling was whether [...]
A lot of what I’ve written here and elsewhere has been pretty negative of late, largely because I’m discouraged by the data flow and its linkage to policy neglect. So, upon feeling pretty good about Twitter’s IPO today, I thought I should take a moment and say so. Not like it’s a big, transformative event [...]
A number of people have asked me my thoughts about this piece by PIMCO founder Bill Gross on inequality, tax reform, and more. Gross argues that as economic growth has become increasingly concentrated, investment and consumer demand have taken a big hit. But how come profit margins keep growing, given that those two growth cylinders [...]
I talk a lot, as one should, about market failures. But government failure is unfortunately, increasingly worthy of attention. Over at the NYT Economix blog.
I’m late to this, but a number of people, as in non-economists, have been asking me about the confusing Nobel prizes given out this year to economists with seemingly fundamentally different views of how the economy works, particularly from the perspective of asset pricing. One winner (Fama) is associated with a theory of highly informed, [...]
I’ll let you read about the latest machinations of the dysfunctionistas up on Capitol Hill. The House melted down–turns out the Cruz strategy had some glitches–and the Senate has taken over (there’s a comforting thought). D’s, to their credit, are trying to avoid locking in sequester-level budget cuts, while R’s are begging for some face-saving [...]
Here’s a useful collection of reasons from Matt Yglesias why debt prioritization won’t work, ranging from it’s illegal to it’s impossible. For those of you lucky enough not to know what I’m referring to, some Republicans are arguing that failing to raise the debt ceiling is no big deal, because the Treasury will have enough [...]
Well, that was expected. Janet Yellen will be nominated by the President tomorrow AM as the next chairperson of the Federal Reserve. It’s not over ‘til it’s over, and it hasn’t started yet, but I suspect she’ll be approved by the Senate. (After the Summers mess, you can bet the admin took the temperatures over [...]
Republicans aren’t going to take part in our study of dysfunctionology, but I’m hoping the moderates will. No one likes to see the market tank, but here’s a piece over at Economix on how that might wake up some reasonable Republicans. Same neighborhood, here a bit of disgruntlement as part of the Room for Debate [...]
Over at the NYT Economix blog.
Besides this newspaper account of negative multipliers in action, you’re probably hungering for more information on the economic impact of the shutdown. –In terms of direct costs, which are lower than total costs (as you’ll see below), that of course depends on how long it lasts, but we’re likely talking single-digit billions. The three-week shutdown [...]
The WaPo’s Howard Schneider posted two neat charts the other day that he thought kinda maybe suggested our economy is poised for a rebound. The first chart showed pent up demand for household formation. That’s good news for both the economy, since it should unleash more consumer demand, no to mention, of course, for parents [...]
*And, like my CBPP colleagues, I consider “prioritization” the same as default. Annie Lowrey provides a clear anatomy of the two different types of fiscal dysfunction Congress is toying around with right now: gov’t shutdown vs. default on the public debt. It’s the fiscal version of a medical journal article on the symptoms of various [...]
I’ve already given Ben&Co. a shout out for holding off on the taper, i.e., continuing their monetary stimulus at the same pace instead of beginning to dial back the asset-buying program. Clearly and appropriately, they were motivated by continued weakness in the macro-economy and the job market. The recovery remains fragile, and higher interest rates [...]
Well, how about that? The Fed just surprised everyone and decided to hold off on the taper for now. I suspected they might, given the set of factors I mentioned this AM. From their statement–very much a “yes…but” kind of thing: Some indicators of labor market conditions have shown further improvement in recent months, but [...]
We’re all on shpilkes here at OTE waiting for the outcome of the Fed’s Open Market Committee meeting to wind up later, with the statement due out at 2. The question, of course, hinges on the taper–if and how much they’ll reduce their monthly asset purchases targeted at lowering longer-term interest rates. A few thoughts [...]
Though not of the change of guard part that’s understandably the rage this AM. This is about the pressing matter of their FOMC meeting this Tues/Wed, wherein they’ll decide whether to start tapering off the amount of their monthly asset purchases, current $85 billion/month. The thinking on the street is that the Fed will decide [...]
I’m surprised but not shocked. Damien Paletta and Kristina Peterson of the WSJ were the first I saw to report that the math for getting the President’s alleged front-runner out of the Senate Banking Committee was getting awfully tough. Though I found Larry to be a strong Keynesian ally during the worst of the great [...]
Will the taper start next week? That’s certainly the conventional wisdom, and I’d put the probability above 50%. Still, there are more headwinds pushing against that idea than tailwinds at its back: long rates already up a point over the past few months, labor market stuck in second gear, GDP barely at trend (1.6% year/year), [...]
Over at the NYT Economix blog, I argue for no tapir taper in Sept.
I posted on this last week and the NYT has some interesting back-and-forth today on this question of whether economics is a legitimate science. The original piece on this claimed that since its variables are social, not physical, constructs, economics is generally unable to make reliable predictions that test, reject, or advance its theories. I [...]
Beyond pointing out that I don’t want either of them to mow my lawn, I’ve remained neutral in the debate over Yellen vs. Summers for Fed chair. I continue to think they’re both fine choices and that the differences between what they bring to the job and how they’d run the Fed are far more [...]