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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- Recent Entries

July 28, 2016, 2:05 am, 1658000

This possibly gated but excellent nonetheless piece is from the FT, here is one excerpt:

A few weeks ago was typical. After some time off, my feed aggregator displayed 794 blog posts, 56 of them foolishly filed into the “must read” folder. Here lay a polemic blasting ...

July 28, 2016, 2:05 am, 1657999

That is a paper from Amihai Glazer, here is the abstract:

A person may vote for a candidate to please citizens who prefer the same candidate, and to anger citizens who dislike the candidate. Such behavior is consistent with high turnout (though any one vote is unlikely to ...

July 28, 2016, 2:04 am, 1657998
(July 28, 2016 12:04 AM, by Bryan Caplan) Robin recently tried an Ideological Turing Test for a subset of my critique of his Age of Em. He understands me better than before, but there's still room for improvement. "Correct" means Robin has described my view to a tee.... (0 COMMENTS)

July 28, 2016, 1:34 am, 1657997

You have an infinite horizon model of inflation. Your model tells you what happens to the time-path of the price level P(t) if the central bank changes monetary policy.

Please do something:

Convert your infinite horizon model into a finite horizon model. Suppose the price level at time T, when the world ...

July 28, 2016, 12:34 am, 1657968

July 27, 2016, 10:04 pm, 1657934
(Don Boudreaux)

… is from page 19 of Christopher Achen’s and Larry Bartels’s new (2016) book, Democracy for Realists ...

July 27, 2016, 9:03 pm, 1657903
Based on the FOMC statement, the likelihood of a rate hike in September (or November or December) has increased. Most analysts talk about possible rate hikes in September or December (ignoring November) because of the scheduled press conferences. However Fed Chair Janet Yellen has made it clear that ...

July 27, 2016, 8:04 pm, 1657897
(July 27, 2016 06:38 PM, by Scott Sumner) Tyler Cowen has a new Bloomberg column: Maybe Negative Yields Are a Sign of Prosperity Just when it seemed that negative yields could not spread any further, they did. Corporate bonds paying negative interest rates now account for about $512... (0 COMMENTS)

July 27, 2016, 8:04 pm, 1657896

July 27, 2016, 8:04 pm, 1657895
Well, by now y’all know that Donald Trump held a press conference today at which he invited Russia to hack into Hillary Clinton’s email server and retrieve the 33,000 emails she deleted.  When questioned about the propriety of encouraging anyone—much less a foreign power—to commit cybertheft, he said Russia probably ...

July 27, 2016, 7:34 pm, 1657894
How to step on a rakeis a little note on how to solve Chris Sims' stepping on a rake paper.

This is mostly of interest if you want to know how to solve continuous time new-Keneysian (sticky price) models. Chris' model is very interesting, combining fiscal theory, ...

July 27, 2016, 6:04 pm, 1657860
(Don Boudreaux)

Lately I feel as I imagine an astronomer would today feel if, centuries after Copernicus and Galileo proved beyond a shadow of a ...

July 27, 2016, 6:04 pm, 1657858

When referring to the amount of government assistance low-income families can get, many are financially better off if they choose not to marry. That’s why it is understandable that poor parents might remain unmarried when the income from the second parent is not enough to offset a loss in government ...

July 27, 2016, 6:04 pm, 1657859

What will be the implications of the attempted coup on US-Turkey relations? Michael Rubin explores Turkish media accusations that the US was complicit in the coup and ...

July 27, 2016, 6:04 pm, 1657857

In today’s Washington Post, I note that the failure of the Obama administration to take any meaningful action against WikiLeaks as it damaged our national security with serial disclosure of classified information has now resulted in what the intelligence community calls “blowback.”

The enemy has turned its attention from the CIA ...

July 27, 2016, 5:24 pm, 1657856
June 2016July 2016CommentsInformation received since the Federal Open Market Committee met in April indicates that the pace of improvement in the labor market has slowed while growth in economic activity appears to have picked up.Information received since the Federal Open Market Committee met in June indicates that the labor market ...

July 27, 2016, 5:03 pm, 1657825

The Federal Reserve held rates steady Wednesday but signaled a brighter outlook for the U.S. economy, suggesting another rate increase in the months ahead. Fed officials said near-term risks to the economy “have diminished” and pointed to better jobs numbers and “moderate” economic growth. Here are some early ...

July 27, 2016, 5:03 pm, 1657824

“I am the king of debt. I do love debt. I love debt.” -Donald J. Trump, May 2016 (WaPo)

The Committee for a Responsible Federal Budget has released its score of the Presidential candidates’ plans. Here is the trajectory of Federal debt under the two plans.

July 27, 2016, 5:03 pm, 1657823
Freddie Mac reported that the Single-Family serious delinquency rate decreased in June to 1.08% from 1.11% in May. Freddie's rate is down from 1.53% in June 2015.

This is the lowest rate since July 2008.

Freddie's serious delinquency rate peaked in February 2010 at 4.20%.

July 27, 2016, 4:04 pm, 1657819
The changes to the platform testify to the strength of the Sanders campaign, and, like that campaign, they are a sign that the dynamism within the party arises right now from its left­wing faction, led by politicians like Mr. Sanders and Senator Elizabeth Warren of Massachusetts. What is less clear ...

July 27, 2016, 4:04 pm, 1657818

The goals of civic education are manifold in the US. Some people believe an end goal for civic education is practical application. This includes students learning the principles of federalism and voting in local, state, and national elections. Others believe an end goal for civics is a responsible citizenship. For ...

July 27, 2016, 4:04 pm, 1657817

“When you get married, I’m pretty sure that you lose your insurance,” Katie, a 26-year-old cohabiting mother of two who receives Medicaid benefits, said in a recent interview with Institute for Family Studies (IFS) research fellows David and Amber Lapp. The Lapps interviewed a dozen poor and lower-middle-class individuals about ...

July 27, 2016, 3:34 pm, 1657812

|Peter Boettke|

David Stockman is in some fundamental sense a modern day Cassandra. The man who taught me economics -- Hans Sennholz -- was as well. Cassandra's get spat in the mouth by the god of the modern science of economics, so while they have the gift of prophecy, ...

July 27, 2016, 3:03 pm, 1657780

The Federal Reserve releases a statement at the conclusion of each of its policy-setting meetings, outlining the central bank’s economic outlook and the actions it plans to take. Much of the statement remains the same from meeting to meeting. Fed watchers closely parse changes between statements to see how the ...

July 27, 2016, 3:03 pm, 1657779

Here's a link to the Fed's statement on its policy decision today:

FOMC statement - FRB

Policy is unchanged, sees improvements in the economy, says short-term risks have fallen.

July 27, 2016, 3:03 pm, 1657778
FOMC Statement:

Information received since the Federal Open Market Committee met in June indicates that the labor market strengthened and that economic activity has been expanding at a moderate rate. Job gains were strong in June following weak growth in May. On balance, payrolls and other labor market ...

July 27, 2016, 2:05 pm, 1657773

That is the latest entry in the Conversations with Tyler series, here is the transcript, audio, and video.  Here is the overview:

Michael Orthofer, one of the world’s most prolific book reviewers, joins Tyler Cowen for a conversation on — what else? — books. Read to discover why Michael believes ...

July 27, 2016, 2:04 pm, 1657772
(Don Boudreaux)

Phil Magness helps us to see that Donald Trump is a vulgar Alexander Hamilton.  Here’s Phil’s conclusion:

Since then [the time ...

July 27, 2016, 2:04 pm, 1657771

When Hillary Clinton became the Democratic nominee for president, the Democratic National Convention audience broke into thunderous applause. But how do Americans view this milestone? In a June Bloomberg survey of likely voters, 15 percent said they wanted her to play up the historic nature of her candidacy, and 16 ...

July 27, 2016, 2:04 pm, 1657770

The 2016 Vice Presidential nominees include two governors, with Indiana Gov. Mike Pence on the Republican ticket alongside Donald Trump while former Virginia Gov. Tim Kaine teams with Hillary Clinton on the Democratic side. Pence and Kaine will be representing their parties and will come to debate each other in ...

July 27, 2016, 1:03 pm, 1657732

Today is July 27, the date in 1940 when Bugs Bunny debuted. The ‘wascially wabbit was spared by hunter Elmer Fudd in a 1942 cartoon when a telegram arrives informing Fudd of a $3 million inheritance on condition that he not harm any rabbits. Fudd lets Bugs ...

July 27, 2016, 1:03 pm, 1657731

Last week, the Tax Foundation released a paper titled, “Reexamining the Tax Exemption of Municipal Bond Interest,” which argued that lawmakers should consider reforming the current tax treatment of municipal bond interest. Apparently, the municipal bond industry is less than thrilled with our report: yesterday, The Bond Buyer ...

July 27, 2016, 1:03 pm, 1657730

Hillary Clinton and Donald Trump will compete this fall in key battleground states where economic growth has been outpacing the modest national average.

Economic output expanded in early 2016 across the majority of states, including four of the biggest prizes up for grabs in the November presidential election: Florida, Ohio, Pennsylvania ...

July 27, 2016, 12:34 pm, 1657729

July 27, 2016, 12:34 pm, 1657728

Here are two views of China’s (goods) trade. Both use the exact same data.

The first presents China’s goods exports and imports as a share of the rest of the world’s GDP:

The second presents China’s goods exports and imports as a share of China’s ...

July 27, 2016, 12:04 pm, 1657727
(July 27, 2016 10:44 AM, by Emily Skarbek) In commenting on Milton Friedman's contributions to economics, it was once remarked that "attempting to portray the work of Milton Friedman . . . is like trying to catch the Niagara Falls in a pint pot." In yesterday's Bloomberg View,... (3 COMMENTS)

July 27, 2016, 12:04 pm, 1657726

“It’s the economy, stupid.”

This bit of down-home political wisdom was at the heart of Bill Clinton’s successful 1992 presidential campaign. And indeed, jobs, income, and living costs are awfully important to voters, if not paramount. Many election forecasting models center on economic variables.

So you’d think the state of the ...

July 27, 2016, 12:04 pm, 1657725

Last week, Danielle Pletka and I had a Facebook Live discussion about the crisis in Turkey. It was a fun experience and a good discussion. One correspondent asked a great question about an angle we hadn’t covered: What might be the impact of the crisis in Turkey upon Iraq?

I ...

July 27, 2016, 12:04 pm, 1657724

I spent the past week teaching cage-busting leadership at Rice’s Jones School of Business and then policy at UPenn’s Graduate School of Education. I think I clocked something like 30 or 35 instructional hours over seven or eight days. It wore me out. Being around so many talented midcareer educational ...

July 27, 2016, 12:04 pm, 1657723

Editor’s note: This article was taken from an interview conducted in Russian and translated to English by the Institute of Modern Russia as part of a series of interviews with experts on Russia’s current political situation.   

Olga Khvostunova, editor-in-chief of, spoke with Dr. Leon Aron, director of Russian studies ...

July 27, 2016, 11:33 am, 1657722

A slightly edited and shorter version of my op-ed in today’s WSJ (with Michael Saltsman), “The Fight for $15 Will Hit North Philly Hard“:

Vermont Sen. Bernie Sanders may not be the Democratic presidential nominee in 2016, but his influence can be seen in the $15-an-hour federal minimum wage that ...

July 27, 2016, 11:03 am, 1657690

The American economy isn’t what it used to be.

Since the recession ended, new establishments have accounted for a little more than 11% of all new private-sector jobs created. During the 1990s, the figure was 15%, according to Labor Department data released Wednesday.

That might not seem like a massive shift, but ...

July 27, 2016, 11:03 am, 1657689
From the NAR: Pending Home Sales Marginally Rise in June

Pending home sales were mostly unmoved in June, but did creep slightly higher as supply and affordability constraints prevented a bigger boost in activity from mortgage rates that lingered near all-time lows through most of the month, according to ...

July 27, 2016, 10:44 am, 1657688

July 27, 2016, 10:35 am, 1657687

We should ask of economic theories not: “are they true?” but rather “how true are they?” I was reminded of this by Noah Smith’s piece pointing out that Friedman’s permanent income hypothesis is wrong – a fact which matters a lot because, as Noah says, the PIH ...

July 27, 2016, 10:04 am, 1657683
(Don Boudreaux)

… is from page 149 of Thomas Sowell’s 2008 volume, Economic Facts and Fallacies (original emphasis):

Claims by some ...

July 27, 2016, 10:04 am, 1657682

Vermont Sen. Bernie Sanders may not be the Democratic presidential nominee in 2016, but his influence can be seen in the $15-an-hour federal minimum wage that is part of his party’s platform in Philadelphia.

The direct and immediate consequences of a higher wage floor on the entry-level job market are well ...

July 27, 2016, 10:04 am, 1657681

As India marks 25 years since the advent of economic reforms, it’s hard to escape the note of self-congratulation in much of the commentary the anniversary has inspired.

Indeed, by most measures there is much to celebrate. In terms of sheer numbers, only China has pulled more people out of extreme ...

July 27, 2016, 9:34 am, 1657679
The Economist is running a series on six big ideas in economics. First up: Akerlof and lemons.

July 27, 2016, 9:03 am, 1657646

Record-low yields on U.S. Treasurys have for decades signaled weakness in the U.S. economy and foreshadowed recession. Not this time.

Some economists are pointing to the so-called yield curve—the difference between long-term and short-term rates—as a harbinger of a new slowdown. Yields on 30-year and 10-year Treasurys plumbed record depths earlier this month, setting fresh milestones in ...

July 27, 2016, 8:35 am, 1657645

The Federal Reserve is expected to forgo a rate hike in today’s FOMC policy announcement and keep the target Fed funds at a 0.25%-to-0.50% range. But the recent increase in the effective Fed funds rate (EFF) suggests that a hawkish bias is bubbling.

EFF’s day-to-day changes can be ...

July 27, 2016, 8:05 am, 1657644

That is the counterintuitive take from my latest Bloomberg column.  Here is one part of the argument:

Perhaps the most overlooked point is that the supply of negative-yielding securities is not so large relative to total global wealth. A recent Credit Suisse estimate suggested that global wealth ...

July 27, 2016, 8:05 am, 1657643

Here’s Four Reasons Financial Intermediaries Fail the latest video from our Principles of Macroeconomics class at Marginal Revolution University.

As always, these videos go great with our superb textbook, Modern Principles of Economics, but they can be used with any textbook. In fact, if you teach economics and ...

July 27, 2016, 7:34 am, 1657640

Fine paraphrase of Louis C. K.'s line to title an excellent article on the EU's dopey antitrust case against Google.

July 27, 2016, 7:34 am, 1657639

Glenn Reynolds: "Government is just another word for the things we choose to screw up together."

And now would be a good time to revisit another fine effort by Professor Reynolds: "How David Brooks created Donald Trump".

Brooks is, of course, horrified at Trump and his supporters, whom ...

July 27, 2016, 7:34 am, 1657638

Interesting observationfrom lefty journalist Ron Fournier:

The American public has lost trust in virtually every social institution—schools, churches, businesses, charities, police, courts, and the media—because those entities have been slow to adapt to sweeping economic, demographic, and technological changes.

I don't know about all of them, but ...

July 27, 2016, 7:33 am, 1657637

Bitter and twisted:

After two decades of submitting papers to journals, and more than 10 years of serving on an editorial board or editing journals, geography researcherKevin Wardknows a thing or two about peer review. ...

In all, Ward — from the University of Manchester in ...

July 27, 2016, 7:23 am, 1657636

One potential benefit of leaving the EU is the opportunity to radically change how we spend agricultural subsidies. The Common Agricultural Policy CAP is one of the great mistakes of the EU. Given the share of EU spending on agriculture, it is their flagship policy, yet the CAP has ...

July 27, 2016, 7:03 am, 1657608

For months, we've been tracking the number of dividend cuts in the U.S. stock market in near real-time, where we've been watching the number of announced reductions reach very worrying levels.

That's why we're pleasantly surprised to be able to report that up to ...

July 27, 2016, 7:03 am, 1657607
From the MBA: Mortgage Applications Decrease in Latest MBA Weekly Survey

Mortgage applications decreased 11.2 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending July 22, 2016.

... The Refinance Index decreased 15 percent ...

July 27, 2016, 6:44 am, 1657606

July 27, 2016, 6:04 am, 1657605
(July 27, 2016 05:01 AM, by Alberto Mingardi) Jeff Bezos was recently interview by the Italian newspaper La Repubblica. Asked by digital editor Massimo Russo "what is the recipe for innovation", he gave a phenomenal answer: Easy: to improve our customers' experience. To be genuinely innovative, innovation needs... (0 COMMENTS)

July 27, 2016, 5:34 am, 1657601

If you want a deep but nontechnical dive into the "block universe," this piece will probably fit the bill,

July 27, 2016, 4:05 am, 1657570

Thank you all for making the first day of The Complacent Class such a success; pre-orders were strong and according to one standard metric it was the #1 best-selling book for Monday.

I am working to get you information on Kindle pre-order, as of now

July 27, 2016, 3:03 am, 1657539

July 27, 2016, 3:03 am, 1657538

Tim Duy:

July FOMC Preview on Bloomberg: How long can doves at the Federal Reserve stand their ground?

The fight within theU.S. central bankcontinues at this week's Federal Open Market Committee (FOMC) meeting as both hawks and doves jockey for dominant position.This battle will go to the doves; the Fed ...

July 27, 2016, 2:05 am, 1657533

In Germany, where I live, you get money back for plastic bottles (“Pfand”). Sometimes €0.25 per bottle. And yet, I collect them, without ever finding the time to cash them. I never outright throw them away, but leave them standing neatly close to public trash cans. They are gone ...

July 27, 2016, 1:34 am, 1657532

Canada is in an abundant TP equilibrium. Washrooms in restaurants, shopping malls, museums, universities, and other public places are, generally speaking, well stocked with toilet paper (TP).

Inner Mongolia is in a scarce TP equilibrium. With the exception of elite venues such as four star hotels and airports, toilet paper is ...

July 27, 2016, 1:23 am, 1657531
‘Fossil fuels have a formidable head start as our entire existing energy system revolves around them’

July 27, 2016, 12:34 am, 1657513
Tags A A Home | Feed | Blog.rssThe EntrepreneurGlobal EconomyU.S. HistoryMonopoly and CompetitionThe FDA’s Cigar Fascism

July 27, 2016, 12:04 am, 1657511
(July 27, 2016 12:09 AM, by Bryan Caplan) While I'm homeschooling my elder sons, I've long wondered about how well it really works. Sure, the critics are usually angry apriorists. But advocates seem quick to repeat optimistic statistics without proper scrutiny. What's really going on?The best piece I've... (0 COMMENTS)