Economics Roundtable

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 .

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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.


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EconBrowser (James Hamilton)

"Analysis of current economic conditions and policy”

November 25, 2015, 11:03 pm, 1582286

Food for thought over the long weekend.

Why Tighten?

I hear a lot about why, despite (by some accounts) a measurable output gap, and low inflation, we need to tighten because of e.g., an incipient housing bubble (or some other unidentified asset bubble). Reuven Glick and Kevin J. Lansing ...

November 22, 2015, 5:03 pm, 1580403

World field production of crude oil increased 2.9 million barrels a day in the 12 months ended last July. That compares with a 3.6 mb/d increase over the entire nine years from Jan 2005 to Dec 2013.

November 19, 2015, 5:03 pm, 1579236

That’s the headline on this afternoon’s release from the Wisconsin Department of Workforce Development. While completely accurate, the summary leaves a just a little context out…

Here is a graph of Wisconsin private nonfarm payroll employment since January 2014.

Figure ...

November 19, 2015, 1:03 pm, 1579090

…very slowly

According to CBO’s August 2015 estimate of potential GDP, the current output gap is 3.2% (log terms); using the WSJ November survey mean growth rates, even by the end of 2016, output will still be 2.2% below potential.

November 15, 2015, 11:03 pm, 1576778

Compared against Minnesota, Kansas, California, and the Nation

Here’s employment.

Figure 1: Log nonfarm payroll employment for Minnesota (bold blue), Wisconsin (bold red), Kansas (green), California (teal) and US (black), all normalized to 2007M12=0. NBER defined recession dates shaded gray. Green shading ...

November 12, 2015, 5:03 pm, 1575607

There are various ways of estimating potential output. I typically refer to the CBO’s estimates, which are basically a production function approach (use trend labor and capital stock, and total factor productivity growth, to infer potential output). However, An alternative is to examine price pressures to infer potential output, as ...

November 10, 2015, 3:03 pm, 1574088

One of the arguments for acting sooner rather than later on monetary policy is that if the slack disappears, inflationary expectations will surge. That’s represented in this quote from reader Peak Trader’s comment. While I don’t rule out this possibility, it seems reasonable to me to empirically assess whether ...

November 10, 2015, 1:03 am, 1573620

The St. Louis Fed has a handy webpage where it shows the implied Fed funds target rate given measures of the output and inflation gaps, and the natural rate of inflation. Here’s recent snapshot I downloaded for my classes.

Source: ...

November 8, 2015, 1:03 pm, 1572579

The strong October employment report makes it look likely that the era of zero interest rates will soon come to an end, at least for the United States.

This raises an interesting question for economic researchers of how we bridge statistical models through the episode when the fed ...

November 6, 2015, 11:03 pm, 1571873

Despite the depth of the last recession, private nonfarm payroll employment is now higher than the corresponding point in the last recovery.

Figure 1: Log private nonfarm payroll employment normalized for NBER peak at 2007M12 (blue), and for NBER peak at 2001M03 ...