Economics Roundtable

March 2017 Fed Funds Rate

What is the effect of a 0.25% change in the Fed Funds rate?.

Click on the image to get a bigger version.

March 2017 Payroll Employment

Payroll employment has not grown impressively since 2000. Some baby-boomers retired, but that does not totally account for this graph.

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May 2014 Payroll Employment

After 76 months, we finally got back to the prerecession level of payroll employment.

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The best summary of the state of our economy is the graph (below) of employment as a fraction of population for people over 16 years old. The decrease is large, but the most troubling feature of the graph is the flat trend .

Click on the image to get a bigger version.

Graph-of-the-Year Candidates

Donald Marron likes European interest rates. Click on the image to get a bigger version. Can you find three distinct subperiods?

Brad DeLong favors the U.S. gdp gap.

Remember M1?

Money Supply M1 growth is now over 20% per year over a 12 month lag. M1 growth has touched 20% before, but not with excess reserves of $1.6 trillion. Where is M1 headed?

Click on the chart for a larger version.


The Economics Roundtable is sponsored by EconModel.

The Classic Economic Models cover micro, macro, and financial markets.

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- Recent Entries

April 25, 2017, 8:04 am, 1740742

April 25, 2017, 7:33 am, 1740740

John Tamny reviews a recent book on the rise and fall of Aliquippa, PA and the Jones & Laughlin steel mill that was a vital part of the town. In this time of laments from some quarters about the "loss of manufacturing jobs" I was glad to see ...

April 25, 2017, 7:33 am, 1740739

Yet another very nice piece by Megan McArdle.

Oh, come on, isn’t this just that old right-wing cliché that markets always produce the best outcome? People acting in their own personal self-interest can often make everyone worse off, including themselves.

Collective action problems certainly ...

April 25, 2017, 7:23 am, 1740738

The principal-agent problem occurs when a principal delegates an action to another individual (agent), but the principal does not have full information about how the agent will behave. Secondly, the interests of the principal diverge from that of the agent, meaning that the outcome is less desirable than the principal ...

April 25, 2017, 6:45 am, 1740707
Higher education authorities are concerned about the implications of Brexit for the income and international standing of UK universities – the possible reduction in the numbers of EU students and staff and the loss of EU research funding. This column explores these threats and argues that there may be real ...

April 25, 2017, 5:34 am, 1740704

A Mercedes and a Lexus make the list.

April 25, 2017, 5:34 am, 1740703

Good. Drill, baby, drill.

Related Stories

April 25, 2017, 5:03 am, 1740686

The Consumer Federation of America recently put out a press release that reports that they've found that 1.1 million student loan borrowers in the United States have gone 270 or more days without making payments on their Federal Direct Student Loans, with more than ...

April 25, 2017, 5:03 am, 1740685

April 25, 2017, 4:04 am, 1740683

I loved The Dispossessed as a kid, though The Left Hand of Darkness was considered the best of her novels.

I am about to read The Word for World Is Forest. The idea of space travel privileging homosexuality really struck me as a child. Perfectly practical and nifty idea. Why ...

April 25, 2017, 2:04 am, 1740667

Mishpacha Magazine featured an article by Philanthropist, Shlomo Yehuda Rechnitz of Los Angeles California discussing his view and approach to the age gap problem in frum circles and calling the current situation a Shidduch Catastrophe. In the article he discussed an idea to help solve the age gap and ...

April 25, 2017, 2:04 am, 1740666

Today, we present a guest post written by Jeffrey Frankel, Harpel Professor at Harvard’s Kennedy School of Government, and formerly a member of the White House Council of Economic Advisers. A shorter version appeared on April 22nd in Project Syndicate.

The Trump Administration says it ...

April 25, 2017, 1:34 am, 1740665

In campaigning for a departure from the Euro, both France's Marine Le Pen and Italy's Beppe Grillo, make the process sound easy. But one does not simply walk out of a monetary union. There are ...

April 25, 2017, 12:44 am, 1740653

For all of the attention that has been given to the Fearless Girl and Charging Bull statues on Wall Street, I've been marveling at what's missing from the picture:  a bear. It's not just that an ursine addition adds whimsy to virtually everything. It's what its absence says ...

April 25, 2017, 12:34 am, 1740652
By: Justin Murray

As Americans were spending time scrambling to give the IRS their annual protection fee, the court system in the United Kingdom, at the behest of National Health Service bureaucrats, abducted and murdered an 8-month-old baby. This brazen abduction ...

April 24, 2017, 10:45 pm, 1740640
Natural disasters have enormous economic consequences, with the 2011 Great East Japan Earthquake providing a particularly stark recent example. This column uses supply chain data for more than one million Japanese firms to explore how negative shocks from natural disasters propagate through firm networks. Shocks are found to propagate very ...

April 24, 2017, 10:45 pm, 1740639
The Global Crisis highlighted how linkages between banks and shadow banking entities can lead to the amplification of shocks across borders and sectors, prompting policymakers to seek to improve the monitoring framework for assessing the interconnectedness of the shadow banking system. This column documents the cross-sector and cross-border exposures of ...

April 24, 2017, 9:33 pm, 1740638

A former dean ofHarvard College and current computer science professor at Harvard blasts the University:

Using “nondiscrimination” as a cudgel against students’ private associations is odiously patronizing. No similar policy applies to Harvard faculty or staff. Even worse, Harvard will compel students ...

April 24, 2017, 9:03 pm, 1740625
From Bloomberg: Trump Said to Plan 20% Tariff on Canadian Softwood Lumber

U.S. President Donald Trump said Monday he would impose a 20 percent tariff on Canadian softwood lumber, according to a White House official and two people present when he made the comment at a reception for conservative ...

April 24, 2017, 8:34 pm, 1740624
By: Louis Rouanet, Jeff Deist

Jeff Deist and Louis Rouanet discuss French politics.

April 24, 2017, 8:04 pm, 1740616
(April 24, 2017 09:50 PM, by David Henderson) With all the negative publicity United Airlines has had lately, I want to share a positive. Yesterday morning, I was flying from Washington Dulles to LAX, with a short time for my connecting flight from LAX to Monterey. We... (0 COMMENTS)

April 24, 2017, 8:04 pm, 1740615
(Don Boudreaux)

… is from page 4 of the manuscript of University of Arizona philosopher David Schmidtz’s contribution to the forthcoming ...

April 24, 2017, 6:34 pm, 1740589
By: C.Jay Engel

Greece is on the hook for a €7 billion debt repayment in July, but may not be prepared to meet the obligation. If Europe doesn't agree to come to an alternative agreement, the IMF may step in and bail ...

April 24, 2017, 6:34 pm, 1740588
By: Jonathan Newman

Neil deGrasse Tyson has released a new video aimed at a what he sees as a growing anti-intellectualism problem in the United States. It was released at the same time as the March for Science and many Earth ...

April 24, 2017, 6:04 pm, 1740587
(April 24, 2017 05:00 PM, by Scott Sumner) The stock market behaved rather strangely in the period before and after the November elections. Before the election, stocks reacted negatively to each Trump surge in the polls, and stock futures fell late in the evening of November 8th, immediately... (0 COMMENTS)

April 24, 2017, 4:04 pm, 1740555

(By the way, if you’re feeling superior and taking comfort that Europe will go first off the cliff, Kotlikoff disagrees. Europe’s debts are larger, but their social programs are better funded, so their fiscal gaps are much lower than ours. The winner, it turns out, is Italy with a ...

April 24, 2017, 4:04 pm, 1740553

On April 4, progressives commemorated “Equal Pay Day,” which purports to note the 20% “gender pay gap” between men and women. But a new study on gender differences in Ph.D. graduates shows, once again, how much of the gender pay gap is simply a myth. Far from men ...

April 24, 2017, 4:04 pm, 1740554

In my first job as a Washington reporter, John Gizzi pulled me into the office to impart wisdom about living and working in this town. One piece that stuck with me: “You can tell a person’s character by how they treat a person from whom they don’t believe they have ...

April 24, 2017, 3:33 pm, 1740550

In my best Thomas Dolby voice: SCIENCE!

...According to a paper published in the journal Scienceon Thursday, Americans are willing to pay $17.2 billion to prevent another BP Deepwater Horizon oil spill. Thanks to a team of scientists who conducted a six-year study into ...

April 24, 2017, 3:03 pm, 1740519

April 24, 2017, 2:34 pm, 1740518

The basic constellation in the post-BoJ QQE, post-ECB QE world marked by large surpluses in Asia and Europe but not the oil-exporters has continued.

Inflows from abroad have come into the U.S. corporate debt market—and foreigners have fallen back in love with U.S. Agencies. Bigly. Foreign purchases of Agencies are back ...

April 24, 2017, 2:04 pm, 1740516

But the revered Icelandic language, seen by many as a source of identity and pride, is being undermined by the widespread use of English, both in the tourism industry and in the voice-controlled artificial intelligence devices coming into vogue.

…A number of factors combine to make the future of the ...

April 24, 2017, 2:04 pm, 1740515
(April 24, 2017 01:37 PM, by Bryan Caplan) The latest Freakonomics Radio is on "Earth 2.0: Is Income Inequality Inevitable?" I'm pleased to be prominently featured alongside Jeff Sachs and Alice Rivlin. A few highlights:And we'll remember to keep our eye on the economic ball: CAPLAN: Any time... (0 COMMENTS)

April 24, 2017, 2:04 pm, 1740514

With the prospect of a government shutdown looming, AEI’s Political Corner updated a chart Gallup produced after the 1995–1996 shutdown to include data from the 2013 shutdown. The tables below look at views around the time of each shutdown, when it ended, and views a few months later. We tracked ...

April 24, 2017, 2:04 pm, 1740513

Questions about the validity of the Turkish referendum have reinforced doubts about Turkey’s trajectory. The observation mission of the Organization for Security and Cooperation in Europe has found that the referendum was neither free nor fair but President Recep Tayyip Erdogan rebuffed ...

April 24, 2017, 1:03 pm, 1740476
The consensus view is that the Fed will hike two more times this year (probably in June and September), and then announce a changed to the balance sheet policyat theDecember FOMC meeting(slow down reinvestment). Merrill Lynch economists think that the Fed will move slower.

A few excerpts from ...

April 24, 2017, 12:34 pm, 1740475

By IMFBlog

At last week’s Spring Meetings of the IMF and World Bank, economists and policymakers discussed ways to maintain the momentum of the global economic expansion—while also ensuring that the fruits of growth are shared more widely within their countries. Fiscal policy—government’s ability to tax and spend—has an important ...

April 24, 2017, 12:04 pm, 1740470

April 24, 2017, 12:04 pm, 1740469
(April 24, 2017 12:09 PM, by Scott Sumner) I now favor a monetary policy rule that I have dubbed the "guardrails" approach, although a more accurate metaphor might refer to the beeper you hear if you are about to hit a car in the front or rear when... (0 COMMENTS)

April 24, 2017, 12:04 pm, 1740468

One has to pity Puerto Rico. With the temporary protection that Congress last year provided the island from its creditors due to expire on May 1, Puerto Rico is now headed for a spate of costly and disruptive creditor lawsuits.

Worse yet, with the changing of the guard in Washington and ...

April 24, 2017, 12:04 pm, 1740467

In an excerpt from his new book, Letters to a Young Education Reformer, Frederick M. Hess describes how his own experiences as a student and a teacher, often in a challenging policy environment, inspired his commitment to opening up outdated education systems so that educators, entrepreneurs, parents, and communities ...

April 24, 2017, 12:04 pm, 1740465

In conjunction with Sexual Assault Awareness Month, observed every April, former Vice President Joe Biden recently sat down for an interview with Teen Vogue to discuss campus sexual assault, including “how sexual assault on campus initiatives may change under the Trump administration.”

While the interview focused on the laudable ...

April 24, 2017, 12:04 pm, 1740466

The following is from an April 24, 2017, Wall Street Journal conversation between the WSJ’s Anne Tergesen, AEI’s Andrew Biggs, and Boston College’s Alicia Munnell. 

WSJ: The population is aging, Social Security’s trust funds are expected to be depleted in 2034, and the median household headed by someone age 55 to ...

April 24, 2017, 11:03 am, 1740431

"Because it offers a rationale for lower taxes on the wealthy":

Zombies of Voodoo Economics, by Paul Krugman, NY Times: According to many reports, Donald Trump is getting frantic as his administration nears the 100-day mark. It’s an arbitrary line in the sand, but one he himself touted in ...

April 24, 2017, 11:03 am, 1740429
From the Dallas Fed: Texas Manufacturing Expansion Continues

Texas factory activity increased for the 10th consecutive month in April, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, moved down three points to 15.4, suggesting output growth ...

April 24, 2017, 11:03 am, 1740430
From the Chicago Fed: Chicago Fed National Activity Index Points to Slower Economic Growth in March

Led by slower growth in employment-related indicators, the Chicago Fed National Activity Index (CFNAI) moved down to +0.08 in March from +0.27 in February. Two of the four broad categories of indicators that ...

April 24, 2017, 10:04 am, 1740428

April 24, 2017, 10:04 am, 1740427

The way the issue is reported, it’s easy to conclude that understanding employment is largely a mechanical exercise: When jobs are available, more people work; when jobs are cut, more people are unemployed. After taking some economics classes, we might develop a slightly more sophisticated understanding—that individuals also make

April 24, 2017, 9:33 am, 1740425

“[T]he overall ability of entrepreneurship to facilitate … economic prosperity depends disproportionately on the … performance of a very small number of new firms.” Guzman and Stern, 2016.

For at least the past 30 years, the rate of U.S. business formation has been falling and the average age of ...

April 24, 2017, 9:03 am, 1740394
Note: I follow several house price indexes (Case-Shiller, CoreLogic, Black Knight, Zillow, FHFA, FNC and more). Note: Black Knight uses the current month closings only (not a three month average like Case-Shiller or a weighted average like CoreLogic), excludes short sales and REOs, and is not seasonally adjusted.

From ...

April 24, 2017, 8:44 am, 1740393

In light of the timeline on the Puerto Rico debt situation, I have just posted on SSRN a contribution to the ABLJ/ABA symposium last fall. The paper ...

April 24, 2017, 8:04 am, 1740392
(Don Boudreaux)

… is from page 71 of UCLA emeritus economist William Allen’s 1989 collection of the transcripts of his splendid radio ...

April 24, 2017, 8:04 am, 1740391
by New Deal democrat A thought for Sunday: the economy is on autopilot. Pray that it stays that way It’s Sunday, so I get to step out from nerdy analysis, and opine as I please. Back in 2014, when there was another GOP “wave” election in the Congress, I wrote ...

April 24, 2017, 7:34 am, 1740389
These are comments I gave on "Inflating away the public debt? An empirical assessment" by Jens Hilscher, Alon Aviv, and Ricardo Reis at the Becker-Friedman Institute Government Debt: Constraints and Choices conference, April 22 2017, along with generic comments on ...

April 24, 2017, 7:33 am, 1740387

Take a guess.

Related Stories

April 24, 2017, 7:33 am, 1740388

At least according to one recent study it's interval training.

April 24, 2017, 7:33 am, 1740385

If you lack things to worry about, try this.

Alarming new research shows one of the deadliest bugs, nicknamed CRE, is actually striking three times more patients than the Centers for Disease Control and Prevention tells us. One lesson from the war against AIDS: level with the ...

April 24, 2017, 7:33 am, 1740384

Short piece by John Crudele illustrates why it is so difficult to control government spending. If you try to micromanage--don't spend money on X--the bureaucrats will tend, as here, toredefine X.

If, on the other hand, you just take a meat ax to the overall budget of an agency, ...

April 24, 2017, 7:33 am, 1740386

"The recipe for growth and prosperity isn’t very complicated."

April 24, 2017, 6:45 am, 1740363

April 24, 2017, 6:44 am, 1740362

Elizabeth Pape, founder of the women's clothing company Elizabeth Suzann, talks with EconTalk host Russ Roberts about starting and running her company--a manufacturer and seller of high-end women's clothing in Nashville, Tennessee. The conversation chronicles the ups and downs ...

April 24, 2017, 6:35 am, 1740361

The US equity market scored its first weekly advance this month, delivering the top performance in April’s third week among the major asset classes, based on a set of exchange-traded products.

Vanguard Total Stock Market (VTI) increased 1.1% for the five trading days through Apr. 21, edging ...

April 24, 2017, 6:04 am, 1740360

Key Points

Assessing baseline trust in Republican and Democratic leadership is useful when assessing prospects for Trump proposals, especially when it comes to education. A quick review of the relevant data suggests that, regarding education, Americans have historically trusted Democrats more than Republicans. However, the Democratic advantage has moved in accord with ...

April 24, 2017, 5:33 am, 1740358

Nice piece to catch you up to date on the potential changes to government pensions in California.

Battle lines are drawn. The unions claim that state and local agencies may not reduce any pension benefits. Pension reformers – and the courts, in recent decisions – say that ...

April 24, 2017, 5:33 am, 1740357

(p. A21) Professor Arrow was widely hailed as a polymath, possessing prodigious knowledge of subjects far removed from economics. Eric Maskin, a Harvard economist and fellow Nobel winner, told of a good-natured conspiracy waged by junior faculty to get the better of Professor Arrow, even if artificially. ...

April 24, 2017, 5:03 am, 1740342

There's an old saying among coders, the polite phrasing of which goes as follows: "To err is human; To really foul things up requires a computer."

We definitely had a mischievous daemon do a number on us last week, where we managed ...

April 24, 2017, 5:03 am, 1740341

April 24, 2017, 4:04 am, 1740340

Lim had told me that Singapore holds a strategic sand reserve, for emergencies.  It lies somewhere near the area called Bedok, I said.  I spotted it one day as I rode past in a taxi.  The site was strewn with No Trespassing signs, installed by the Housing and Development ...

April 24, 2017, 2:04 am, 1740317

Dennis was actually the first stagnation theorist I read, at about the age of eighteen, due to a recommendation from Walter Grinder.  His strength is to tie stagnationist claims into the political economy of war.  This is from 1940 (book link here), I hope it is no ...

April 24, 2017, 12:34 am, 1740303
By: Brittany Hunter

Women in the workforce are constantly bombarded by rhetoric intended to make us feel less appreciated than our male colleagues. Politicians and Hollywood celebrities — many of whom have never worked one day in a traditional office ...