Last year’s infatuation with globally synchronized growth was at least understandable. From a certain, narrow point of view, Europe’s economy had accelerated. So, too, it seemed later in the year for the US economy. The Bank of Japan was actually talking about ending QQE with inflation in sight, and the PBOC was purportedly tightening as China’s economy appeared to many [...]
For all its tortured economic history since 1989, Japan has never really had an unemployment problem. Going by its unemployment rate alone, conditions don’t ever appear to be all that out of line. At its worst, in both the dot-com recession as well as Japan’s experience during the Great “Recession”, the highest it ever got was 5.5%. That’s more than [...]
At their December 2017 policy meeting, the FOMC majority voted to increase the monetary policy targets (RRP & IOER) by an additional 25 bps. It was the fifth such move dating back to December 2015. It was not, however, a unanimous decision. Chicago Fed President Charles Evans and Minneapolis Fed President Neel Kashkari both opposed the “rate hike.” At a [...]
Retail sales rose (seasonally adjusted) in March 2018 for the first time in four months. Related to last year’s big hurricanes and the distortions they produced, retail sales had surged in the three months following their immediate aftermath and now appear to be mean reverting toward what looks like the same weak pre-storm baseline. Exactly how far (or fast) won’t [...]
Allusions to a labor shortage continue to be ubiquitous. Two weeks ago, the Wall Street Journal published yet another such story under the headline Iowa’s Employment Problem: Too Many Jobs, Not Enough People. Ostensibly about the experiences of companies trying to hire in the one state, the implication was clear enough. If Iowa, IOWA, has a labor shortage, how bad [...]
One more point on the hourly compensation estimates as they relate to this supposed labor shortage. As I wrote in examining the Beveridge Curve from a different, and ultimately more consistent, perspective: It just doesn’t work that way. In a real labor shortage, wage gains wouldn’t be modest because they couldn’t be modest. If they are modest, then the shortage [...]
I’ve found the word “dissonance” has become more common in regular usage beyond just my own. Whether that’s a function of my limited observational capacities or something more meaningful than personal bias isn’t at all clear. Still, the word does seem to fit in economic terms more and more as we carry on uncorrected by meaningful context. The Buffalo News [...]
Ever since Robert Solow and Paul Samuelson wrote of an exploitable Phillips Curve in 1960, economists have had dreams of being able to precisely control the economy through the exchange of inflation and unemployment. The original paper, the one sold to, and bought by, the Kennedy Administration, theorized it was possible to sort of “purchase” very low unemployment by allowing [...]
Princeton University economist Alan Krueger recently published and presented his paper for Brookings on the opioid crisis and its genesis. Having been declared a national emergency, there are as many economic as well as health issues related to the tragedy. Economists especially those at the Federal Reserve are keen to see this drug abuse as socio-demographic in nature so as to [...]
Activist hedge fund manager Bill Ackman succeeded in 2013 in ousting Procter & Gamble’s CEO Bob McDonald. It was noteworthy at the time because the company issued a strange memo repeating often verbatim answers to questions it posed to itself. Among them was if Mr. McDonald was fired or, as had been relayed publicly, he voluntarily retired. The memo merely [...]
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