Economics Roundtable

May 2014 Payroll Employment

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

Click on the image to get a bigger version.


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.


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Worthwhile Canadian Initiative

"Who would have thought an economics blog could be this exciting?”

May 26, 2016, 9:35 am, 1640062

Just a simple "teaching" post.

There are two different ways of thinking about central bank profits (of doing the accounting). A simple numerical example will illustrate the difference.

Assume 2% inflation, and 1% real GDP growth, so Nominal GDP grows at 3%. Assume the stock of currency is 5% of annual NGDP. ...

May 25, 2016, 7:34 am, 1639641

Let's do a back-of-the-envelope calculation. Assume a 5% currency/Nominal GDP ratio. Assume the government/central bank wants to use helicopter money to permanently raise the level of NGDP by 5% above what it would otherwise be. So the stock of currency will be permanently higher by 0.25% of NGDP. And assume ...

May 24, 2016, 9:34 am, 1639315

It is of course useful from time to time to take a look at the longer-term picture when it comes to health spending especially given that there is a slowdown in health expenditure growth. Figure 1 plots per capita total health expenditure in US PPP dollars from 1960 to 2014 ...

May 19, 2016, 5:34 pm, 1638200

Today I was asked by a government policy analyst: "I'm trying to think of an example of a situation when ethnicity or culture matters in regulatory policy. Can you help me out?"

Here's my best attempt. I challenge others to try to come up with a better example.

The regulation: In Canada, ...

May 17, 2016, 11:34 am, 1637319

GBA+ [Gender-Based Analysis plus] is an analytical tool used to assess the potential impacts of policies, programs, services, and other initiatives on diverse groups of women and men, taking into account gender and other identity factors. The "plus" in the name highlights that

May 4, 2016, 9:34 am, 1632910

I give my kids $100 and tell them to spend it not save it.

1. How can I tell whether my kids have really spent $100 more than they otherwise would have spent? Maybe they would have spent $100 anyway.

2. How can my kids tell whether I have really given them ...

May 2, 2016, 5:34 am, 1631992

David Andolfatto has a very good post on "Monetary Policy Implications of Blockchain Technology". In passing (it's not a central point of his post), David says:

"However, it's worth pointing out that the leading economic theory of bank sector fragility, the

April 22, 2016, 11:34 am, 1629093

At the risk of being thought "cavalier", I don't like what Bank of Canada governor Stephen Poloz is reported as saying by Kevin Carmichael.

Inflation targeting is supposed to be inflation forecast targeting. The Bank of Canada is supposed to do what is needed to ensure that its own ...

April 16, 2016, 3:34 pm, 1627269

As we all know, Canada will be running deficits well into the foreseeable future.  Based on the figures from the 2016 Federal Budget, as a percentage of GDP Canada will see its deficit go from a surplus of 0.1% in 2014 to -1.5% in 2016 and then will range from ...

April 14, 2016, 9:34 pm, 1626861

I read Steve Williamson's new post. I could try and poke holes in his modelling. But it would be pointless, like a high-school debate. The disagreement is much more fundamental. I hope this is more constructive.

Inflation doesn't just happen. In a New Keynesian model, individual firms choose how ...