Economics Roundtable

January 2014 Payroll Employment

We are getting closer to the previous peak.

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.


The Economics Roundtable is sponsored by EconModel.

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

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Economics Help

"Helping to Simplify Economics”

April 22, 2014, 7:23 am, 1258741

Readers Question: Can you please explain how speculators can gain a profit from speculative attack on currencies?

A speculative attack on a currency occurs when ‘investors’ believe that the value of a currency is over-valued and therefore, they sell that currency in ...

April 4, 2014, 7:23 am, 1250759

Readers Question: Is there an inbuilt deflationary bias in the Eurozone?

Deflationary bias means that there is a tendency for economic policy to promote lower growth and lower inflation. It means there are pressures which keep demand subdued leading to lower inflation, ...

April 4, 2014, 7:23 am, 1250758

A look at the effects of how an over-valuation of the exchange rate can cause deflation.

Readers Question: does an appreciation in the exchange rate cause deflation?

An appreciation does tend to reduce inflationary pressures. This is because after after an appreciation in ...

April 3, 2014, 7:23 am, 1250186

Current UK Inflation Rate

CPI  inflation rate: 1.7% (headline rate) CPIH grew by 1.6% in the year to Feb 2014  (page updated April 3rd, 2014)

The largest contributions to the fall in the rate came from ...

April 3, 2014, 7:23 am, 1250185

Readers Question Why is the forward guidance threshold set at 7% unemployment and how does this affect the threshold for inflation?

The MPC have a remit to target inflation of CPI = 2% +/-1. But, the MPC also consider wider issues of ...

March 26, 2014, 7:23 am, 1246230

Readers Question: How reliant is the UK economy on oil?

There are two ways of considering this question – the consumption and production of oil.

Firstly, how much does the UK need to consume oil to maintain economic activity? Could we survive in a ...

March 25, 2014, 7:23 am, 1245561

Readers Question: What country’s don’t use the carbon tax and with country produces the most carbon dioxide.

The biggest absolute emissions come from China, and the United States. In terms of CO2 emissions per capita, China is ranked only ranked 55th, at ...

March 24, 2014, 5:23 am, 1244942

Readers Question: What policy strategy is good to reduce unemployment in Greece?

The Greek economy is experiencing grave problems, with record levels of unemployment. Unemployment in Greece is running at 27.5% – (end of 2013) This unemployment rate is even higher amongst young people.

The unemployment is primarily caused by the prolonged ...

March 20, 2014, 5:23 am, 1243348

The Indian Rupee has fallen in value against a basket of currencies since independence in 1947. In recent years, the Indian Rupee has continued to depreciate in value.

Indian Rupee value against US Dollar

March 12, 2014, 11:23 am, 1239392

Traditionally, the key measures of economic performance in macro-economics include:

Economic growth – real GDP growth. Inflation – e.g. target CPI inflation of 2% Unemployment – target of full employment Current account – satisfactory current account, e.g. low deficit.

Of these indicators, economic growth is usually the most importance and given the greatest credence for ...