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.


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”

October 7, 2015, 1:23 pm, 1554657

The balance of payments is the record of a country’s transactions / trade with the rest of the world.

The balance of payments consists of:

Current Account (trade in goods, services + investment incomes + transfers) Capital Account / Financial Account (capital and financial flows, net investment, portfolio investment) Errors and omissions. It is ...

October 7, 2015, 1:23 pm, 1554656
Definition of Household savings ratio: The percentage of disposable income that is saved. (1) Total savings = Disposable income – Household consumption

UK Saving Ratio

Latest UK household savings ratio: Q2 2015 = 4.7%

UK Saving ratio. Source: National income accounts Q4 

October 6, 2015, 11:23 am, 1553907

Economic growth per capita looks at the average increase in real GDP per person.

We could have economic growth of 3% a year. But, if population growth is also 3%, then average incomes – Real GDP per capita will remain the same.

If the population declines by 2% a year, but real ...

October 6, 2015, 11:23 am, 1553906

The home secretary Theresa May will state that immigration has little economic benefit.

“at best the net economic and fiscal effect of high immigration is close to zero”. (Independent)

There are potential costs of immigration – for example, the UK is struggling to build sufficient housing to prevent rising house ...

October 5, 2015, 3:23 pm, 1553450

Readers Question: Is the following concept correct or not – Nobody wants a free good?

Firstly, a free good is a good with zero opportunity cost.

Water is usually a free good in the UK.

Examples of a free good include:

Water ...

October 2, 2015, 1:23 pm, 1552548

Product failure is when a new product is launched but fails to gain sufficient sales and market sales, resulting in a net loss for a firm.

To understand product failure, it is good to look at a few examples of product failure. (Top 20 product failure here)

Some of these examples, ...

October 2, 2015, 1:23 pm, 1552550

An examination of UK house price affordability.

In 2013, UK house prices rose 8%, and most forecasters expect UK house prices to continue to rise above inflation in the short term. However, there is a big concern that house prices are already unaffordable for most first time buyers. In many parts ...

October 2, 2015, 1:23 pm, 1552549

October 2015 will see England introduce a charge of 5p for plastic bags.

Early evidence from Scotland suggests that a tax on plastic bags can lead to a significant fall in demand. Supermarkets in Scotland reported an 80% fall in use of plastic bags a month after the charge was introduced. ...

September 28, 2015, 11:23 pm, 1550465

The ONS produce an RPI pensioner index which is the inflation rate calculated for the spending patterns of the average pensioner.

The series is here: RPI Pensioner index

CZIT – Percentage change over 12 months: One-person pensioner households index. CZJI – Percentage change over 12 months – Two-person pensioner households ...

September 22, 2015, 7:23 am, 1547368

The effective exchange rate measures the value of a currency against a basket of other currencies. This exchange rate index is usually trade-weighted to take into account the relative importance of other currencies.

When looking at the effective Sterling exchange rate we will compare the value of Sterling against our main ...