Economics Roundtable

March 2017 Fed Funds Rate

What is the effect of a 0.25% change in the Fed Funds rate?.

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March 2017 Payroll Employment

Payroll employment has not grown impressively since 2000. Some baby-boomers retired, but that does not totally account for this graph.

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May 2014 Payroll Employment

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

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Jobs

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?


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Brad Setser:  Follow the Money


May 15, 2017, 4:34 pm, 1747808

China tends to import natural resources—oil, iron ore, soybeans and the like. Now that China has a large industrial economy, it doesn’t have much choice: China wasn’t blessed with a ton of oil or gas, or a ton of arable land (relative to its population).

And China tends to export a ...


May 12, 2017, 2:34 pm, 1747067

U.S. trade deficit did not change much in the first quarter. The real (price adjusted) goods deficit that is. Oil prices were a bit higher in q1 than q4 (they are now back below their q4 levels, but that will impact the June and July data)

The quarterly real non-petrol deficit ...


May 11, 2017, 2:34 pm, 1746673

This is a joint post with Cole Frank, a research associate here at the Council on Foreign Relations.

One of the challenges China poses is that by the time something shows up cleanly in the numbers, things often have changed. I feel that risk acutely now. The latest high frequency indicators ...


April 26, 2017, 4:34 pm, 1741312

The idea behind “fiscally-driven external rebalancing” is straightforward.

If countries with external (e.g. trade) surpluses run expansionary fiscal policies, they will raise their own level of demand and increase their imports. More expansionary fiscal policies would generally lead to tighter monetary policies, which also would raise the value of their ...


April 24, 2017, 2:34 pm, 1740518

The basic constellation in the post-BoJ QQE, post-ECB QE world marked by large surpluses in Asia and Europe but not the oil-exporters has continued.

Inflows from abroad have come into the U.S. corporate debt market—and foreigners have fallen back in love with U.S. Agencies. Bigly. Foreign purchases of Agencies are back ...


April 20, 2017, 12:34 pm, 1739503

A long time ago I confessed that I like to read the IMF’s World Economic Outlook (WEO) from back to front. OK, I sometimes skip a few chapters. But I take particular interest in the IMF’s data tables (the World Economic Outlook electronic data set is also ...


April 12, 2017, 6:34 pm, 1737503

There is no single definition of manipulation, to be sure—so no way of definitively answering the question. Over the last ten or so years, manipulation has been equated with “buying foreign exchange in the market to block appreciation.” That definition is certainly built into the criteria laid out in the ...


April 10, 2017, 4:34 pm, 1736513

I confess that I probably am the only person in the world who—setting aside the internal politics of the Trump White House—would be excited to write the Treasury’s foreign currency report this quarter.

Not because of China. I would say China met the existing 2015 manipulation criteria in the past and ...


April 10, 2017, 12:34 am, 1736252

Does China manage its currency against the dollar, against a basket, or to whatever is most convenient at any given point time? Cynics have argued that China seems to peg to the dollar when the dollar is going down and the basket when the dollar is going up.

The yuan’s moves ...


April 6, 2017, 12:34 am, 1735366

Martin Wolf’s important column does a wonderful job of illustrating the basic risk China poses to the world: at some point China’s savers could lose confidence in China’s increasingly wild financial system. The resulting outflow of private funds would push China’s exchange rate down, and rise to a big ...