Economics Roundtable

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?


Click on the chart for a larger version.


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Winterspeak


July 2, 2014, 10:36 pm, 1294710
Looks like I'm not on the only one struck by how the Lehman Examiner's report elides how the bank was insolvent. And I'm not talking about coming in under regulated capital ratios, I'm talking about a (massively) negative equity number.

Two unanswered questions stand out. The first is that even ...


July 2, 2014, 10:36 pm, 1294711
I scanned a the opening few chapters on Lehman's Repo 105 and I must say, the report, while excellent in its detail, seems to be to conservative on the state of Lehman just prior to its demise. For example:

Lehman maintained approximately $700 billion of assets, and corresponding liabilities, on ...


July 2, 2014, 10:36 pm, 1294712
Like the Bourbons, the Main Strem Media -- and many bloggers -- both remember nothing and forget nothing. The New Yorker's John Cassidy demonstrates this in his haigography on Obama's Geithner:

And yet—whisper it softly—there is good news about the financial system and the roundly loathed bank bailout, the seven-hundred-billion-dollar ...


July 2, 2014, 10:36 pm, 1294713
Rolfe Winkler lays out a good, if often unspoken, reason for why the Obama has supported his predatory financial system instead of fixed it.

Throughout there was much indignation as to why such sensible reforms haven’t been enacted. Wall Street’s lobby machine got most of the blame, the rest went ...


July 2, 2014, 10:36 pm, 1294709
Marketplace has a nice video on how Repo 105. Unfortunately, they completely miss the role repos play in the banking system. It actually took me a while to figure this out and I understand the banking system very well, so this may be confusing other people as well.


July 2, 2014, 10:36 pm, 1294708
For those of you into motorcycles, here's a series of great interviews with Erik Buell, who used to make the only bikes on the planet worth thinking about.


July 2, 2014, 10:36 pm, 1294705
The public purpose of banking is to provide credit analysis -- namely, to separate good loans (loans that will be paid back) from bad loans (loans that will not be paid back). Therefore, having private banks issue loans that the Government banks makes no sense. Having the Government make


July 2, 2014, 10:36 pm, 1294706
The NYTimes leads:

The bursting of the real estate bubble and the ensuing recession have hurt jobs, home prices and now Social Security.

This year, the system will pay out more in benefits than it receives in payroll taxes, an important threshold it was not expected to cross ...


July 2, 2014, 10:36 pm, 1294707
The first from David Kelly via Mosler:

The most obvious quantifiable impact of the bill is an increase in taxes for upper income Americans, particularly on investment income. Starting in 2013, the Medicare tax rate on households with income over $250,000 will be increased from 1.45% to 2.35%. In addition, ...


July 2, 2014, 10:36 pm, 1294704
Obama's healthcare plan requires individuals to buy insurance, requires insurance companies to accept all customers, and subsidizes those who cannot afford to buy insurance themselves. Public funding and private provisioning can be a good idea, but the flaws with Obamacare have been well documented elsewhere.

I am not interested ...