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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Macro and Other Market Musings

David Beckworth.

November 19, 2015, 7:23 am, 1578924
Has the market-clearing or 'natural' short-run interest rate been negative over the past seven years? The answer to this question would go a long ways in ending much confusion about Fed policy. If the answer is yes, then the Fed has not been 'artificially' suppressing interesting rates as ...

November 18, 2015, 1:23 pm, 1578482
What does it take to create a panic attack at the Fed? How about a large credit and housing boom that wreaks havoc on household balance sheets? Nope, been there, done that with no loss of sleep. What about experiencing the sharpest recession ...

November 11, 2015, 1:23 pm, 1574812
The fourth GOP debate was last night and the economy was an important part of the conversation. Much was said last night that deserves commentary, but I want to focus on one claim that really surprised me. It surprised me because it went against the standard GOP narrative ...

October 21, 2015, 9:23 am, 1561350
As a follow up to my last post, I want to repeat a point I have made before. Not only is the Fed not responsible for the low interest rates during the past seven years, but it is also not responsible for enabling the large budget ...

October 19, 2015, 5:23 pm, 1560510
As a free-market loving individual, it pains me to see so many of my fellow travelers claim the Fed has artificially suppressed interest rates since the onset of the crisis. Recently, I was disappointed to see George Will and Bill Gross repeat these claims. They have made these ...

October 12, 2015, 9:23 pm, 1557092
I am seeing more and more people get excited about "People's QE", the brainchild of UK labor party leader Jeremy Corbyn. For example, Roger Farmersees it as similar in spirit to his own preferred approach, Ambrose Evans-Pritchard says "it is exactly what the world may soon ...

October 9, 2015, 3:23 pm, 1555983
Ben Bernanke's memoir is now out and is unapologetically pro-Fed. It is titled "The Courage to Act" Here is the cover quote:

The main point of Bernanke's book ...

September 30, 2015, 1:23 pm, 1551341
So it appears the Bank of Japan (BoJ) had already doubled down on Abenomics before the prime minister announced a new NGDP level target. In late 2014, the BoJ said it would increase the growth of the monetary base and by implication the number of assets it ...

September 28, 2015, 3:23 pm, 1550270
So Japan's Prime Minister Shinzo Abe has decided to adopt a NGDP level target:

Formally re-elected head of the ruling party, Prime Minister Shinzo Abe said Thursday he has set out three new goals for “Abenomics” and will target a 20 percent increase in gross ...

September 22, 2015, 9:23 am, 1547449
The Cato Institute for Monetary and Financial Alternatives asked me to write a brief response to the last FOMC decision. It is now up at the Alt-M blog. Here is an excerpt:

Just a few months ago the FOMC was signaling it would almost certainly raise ...