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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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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Stephen Williamson

"Stephen Williamson:  New Monetarist Economics
My lastest ideas on macroeconomics, monetaryu economics, economic policy and current events”

April 13, 2017, 6:35 pm, 1737851
Ben Bernanke has written a couple of blog posts on the zero lower bound (ZLB) on nominal interest rates, and some implications for monetary policy going forward. The first deals with the extent of the ZLB "problem," and the second with monetary policy solutions.

In a ...

April 2, 2017, 2:34 pm, 1734251
Andy Haldane, Chief Economist at the Bank of England, gave a speech last Friday at the San Franciso Fed titled "A Little More Conversation, a Little Less Action." What was Haldane trying to get across? He wants to build "trust and legitimacy" by "rethinking how and with whom central ...

March 29, 2017, 6:34 pm, 1732965
That real rates of return on government debt are at historical lows is well-established. Of course, the anticipated real rate of return on government debt - which is what matters for economic behavior - is unobservable, and that's problematic. Typically, macroeconomists resort to proxy measures as a starting point for ...

March 20, 2017, 2:34 pm, 1730196
Sociologists sometimes feel neglected. And this can cause them to complain - about economists. Economics is a successful social science. While most social sciences do well in attracting undergraduate students, economics has performed well off campus. An undergrad economics major pays well, and an economics PhD provides entry into ...

March 19, 2017, 6:34 pm, 1729960
What are people talking about when they say "full employment?" Maybe they don't know either? Whatever it is, "full employment" is thought to be important for policy, particularly monetary policy. Indeed, it typically enters the monetary policy discussion as "maximum employment," the second leg of the Fed's dual mandate - ...

March 3, 2017, 6:34 pm, 1725601
In the past year, inflation rates have increased in a number of countries. Are these increases temporary or permanent? What do they imply for monetary policy?

One of the more stark turnarounds in ...

February 21, 2017, 4:34 pm, 1721922
I was sad to learn today that Tim Fuerst has passed away. Tim received his PhD from Chicago in 1990, was the William and Dorothy O'Neill Professor at the University of Notre Dame, ...

February 13, 2017, 8:34 pm, 1719500
We're starting to hear some public discussion about Fed balance sheet reduction. For example, Jim Bullard has spoken about it, and Ben Bernanke has written about it.

Balance sheet reduction is part of the FOMC's "Policy Normalization Principles and Plans. Quoting from scripture:

The Committee ...

February 3, 2017, 4:34 pm, 1716588
I've accepted a new job, beginning in the 2017-18 academic year, as the Stephen A. Jarislowsky Chair in Central Banking in the Economics Department at Western University (a.k.a. the University of Western Ontario), London, ...

January 15, 2017, 6:34 pm, 1710737
What's a macro model? It's a question, and an answer. If it's a good model, the question is well-defined, and the model gives a good answer. Olivier Blanchard has been pondering how we ask questions of models, and the answers we're getting, and he thinks it's useful to divide ...