US inflation in January 2019 was, according to the CPI, the lowest in years. At just 1.55% year-over-year, the index hadn’t suggested this level since September 2016 right at the outset of what would become Reflation #3. Having hyped expectations over that interim, US policymakers now have to face the repercussions of unwinding the hysteria. Live by oil, now die [...]
They staked everything on inflation. In truth, central bankers had no other choice. Having backed themselves into such a narrow corner by doing the same thing over and over and over again, it was only going to be one or the other. Either it worked or for all time they would prove they really have no idea what they were [...]
It’s been awhile since we’ve had any data on the US economy. With the federal government having been shut down, especially the Census Bureau, the figures have gone dark. The current short-term government reopening will lead to an eventual rush of estimates, perhaps a few series that will be updated two months at a time. In lieu of all that, [...]
I have to agree with my colleague Joe Calhoun. Everyone thinks the Fed is (over)reacting to the stock market drop in December. There’s a little bit of truth in it, reading so many FOMC transcripts as I have you get the unmistakable sense the S&P 500 is unofficially included on the policy dashboard. In the early part of 2007, policymakers [...]
It was a tense exchange. When even politicians can sense that there’s trouble brewing, there really is trouble brewing. Typically the last to figure these things out, if parliamentarians are up in arms it already isn’t good, to put it mildly. Well, not quite the last to know, there are always central bankers faithfully pulling up the rear of recognizing [...]
A Return To Normalcy In the first two years after a newly elected President takes office he enacts a major tax cut that primarily benefits the wealthy and significantly raises tariffs on imports. His foreign policy is erratic but generally pulls the country back from foreign commitments. He also works to reduce immigration and roll back regulations enacted by his [...]
A year ago, central bankers were over the moon. From those in the US to those in Europe, with Japanese officials in between, they really thought they had it. There wasn’t much basis for the belief, mind you, merely the fact that positive numbers were registering in all those places at the same time. Like some old Three Stooges movie, [...]
In the chaotic days of the early “recovery”, those opposed to the Federal Reserve’s response largely fell into the wrong camp. The central bank had done too much, they claimed. Never mind how the first global panic in four generations had developed and then crushed the global economy, such deflation was over to be taken apart by rapid inflation if [...]
As I wrote yesterday, “In the West, consumer prices overall are pushed around by oil. In the East, by food.” In neither case is inflation buoyed by “money printing.” Central banks both West and East are doing things, of course, but none of them amount to increasing the effective supply of money. Failure of inflation, more so economy, the predictable [...]
The US federal government is shut down and certain economic data accounts are being left to go without scheduled updates, things like US trade provided by the Census Bureau. The Bureau of Labor Statistics’ more watched series aren’t among the forgotten, however. The monthly payroll report would be compiled and released even during a nuclear attack. Yes, it really is [...]
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