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.

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June 29, 2016, 5:33 pm, 1649627

Tomorrow, June 30, marks the 215th anniversary of the birth of the great French classical liberal economist Frédéric Bastiat (born June 30, 1801) whom economist Joseph Schumpeter called the “most ...

June 29, 2016, 5:03 pm, 1649596

Today, we are pleased to present a guest column written by Jeffrey Frankel, Harpel Professor at Harvard’s Kennedy School of Government, and formerly a member of the White House Council of Economic Advisers.

I see a possible way out for the trap that Brits now find themselves in, a way ...

June 29, 2016, 5:03 pm, 1649595
The Case-Shiller house price indexes for April were released yesterday. Zillow forecasts Case-Shillera month early, and I like to check the Zillow forecasts since they have been pretty close.

From Zillow: May Case-Shiller Forecast: April's Modest Monthly Slowdown Should Continue

April Case-Shiller data showed seasonally adjusted ...

June 29, 2016, 4:44 pm, 1649594

June 29, 2016, 4:04 pm, 1649593
(June 29, 2016 01:14 PM, by Emily Skarbek) Mark Blaug (1927-2011) was an economist best known for his work in history of economic thought and the methodology of economics. He was a student of George Stigler at Chicago in the 1950s and went on to teach at Yale,... (0 COMMENTS)

June 29, 2016, 3:34 pm, 1649588

I dislike the fact that I can't let this go but in September of 2015 I said this in response to that title of a Mankiw column: "I don't really understand how one can say that the Republican Party is where efficient climate policy will happen." And still, ...

June 29, 2016, 3:34 pm, 1649587

From the Huffington Post (which I try to avoid unless they are writing something funny about Exxon*):

ExxonMobil has long maintained that it supports a carbon tax in the United States.

For instance, here’s Suzanne McCarron, ExxonMobil vice president of public and government affairs, in the Los Angeles Times on Mar. ...

June 29, 2016, 3:33 pm, 1649586

Some updates on the impressive advances in robotic technology.

1. Meet the SpotMini Robot above from Boston Dynamics — it weighs 55 pounds, is all-electric (no hydraulics), runs for about 90 minutes on a charge, and is one of the quietest robots ever built. They just ...

June 29, 2016, 3:03 pm, 1649555

Today is June 29, the date in 1767 when the British Parliament began passing the Townshend Acts, a series of import taxes on the American colonies to replace the reviled stamp act. Widespread resistance to the taxation without representation led to British troops being deployed, which led to the 

June 29, 2016, 3:03 pm, 1649554

With Puerto Rico threatening to default on the most senior bonds issued by the territory, the Senate advanced legislation approved by the House to allow the island to restructure its debts under the supervision of a newly created federal board.

How did Puerto Rico end up here? Puerto Rico’s ...

June 29, 2016, 3:03 pm, 1649553

Luigi Zingales at ProMarket:

The Real Lesson From Brexit: ...What we have observed in Britain and ... in the U.S. with Trump is a growing mistrust of voters toward experts. In the Brexit debate it was hard to find any economist justifying a departure from the European Union. In fact, ...

June 29, 2016, 2:44 pm, 1649552

June 29, 2016, 2:34 pm, 1649551
Tags A A Home | Feed | Blog.rssBig GovernmentGlobal EconomyThe EU Is About Control, Not Free Trade

June 29, 2016, 2:05 pm, 1649542

Speaking at the end of a summit in Brussels where EU leaders started trying to pick through the wreckage after David Cameron’s referendum defeat, Mr Hollande warned that it would be unacceptable for clearing — a crucial stage in ...

June 29, 2016, 1:34 pm, 1649538

June 29, 2016, 1:33 pm, 1649537

For a few years nowwe have heard about a helium shortage. Whilemost of us(just me?) think of helium as that fun gas that makes things float and gives us a Donald Duck voice, helium actually has some important uses. For example, MRI's rely on helium (I'm not sure how, but ...

June 29, 2016, 1:23 pm, 1649536

The Atlanta Fed's 2015 Annual Report focused on the graying of the U.S. economy. Part of the report and a follow-up webcast discussed how aging is driving the depletion of the U.S. Social Security and Medicare trust funds.

Based on current projections from the Congressional Budget ...

June 29, 2016, 1:03 pm, 1649505
Freddie Mac reported that the Single-Family serious delinquency rate decreased in May to 1.11% from 1.15% in April. Freddie's rate is down from 1.58% in May 2015.

This is the lowest rate since August 2008.

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

June 29, 2016, 12:05 pm, 1649504

The answer seems to be twenty, seventeen for personal finance.  Here is a full report on that topic (pdf).  Most of those states are in the South, plus CA, NY, IN, and MI.  Virginia is often considered the national leader with regard to actual substance and quality.

Here ...

June 29, 2016, 11:34 am, 1649500

|Peter Boettke|

This is not news, but it is worthy to note. Buchanan bequeathed $2.5 million to Middle Tennessee State University. They have created an Honors College there. In addition to watching this video, check out From Nashborough to the Nobel Prize: The Buchanans of Tennessee(Twin Oakes Press*, ...

June 29, 2016, 11:03 am, 1649468
From the NAR: Pending Home Sales Skid in May

After steadily increasing for three straight months, pending home sales letup in May and declined year-over-year for the first time in almost two years, according to the National Association of Realtors®. All four major regions experienced a cutback in contract ...

June 29, 2016, 10:44 am, 1649467

June 29, 2016, 10:34 am, 1649466
A A Home | Feed | Blog.rssMy Contributions to Entrepreneurship Theory 0 Views

June 29, 2016, 10:04 am, 1649465
(Don Boudreaux)

… is from page 205 of William Easterly’s 2013 book, The Tyranny of Experts (original emphasis):

The nationalist obsession ...

June 29, 2016, 9:03 am, 1649430

It’s not just your imagination. It is a lot harder to afford an apartment today than it was for your parents’ generation.

Sharp  increases in rents along with stagnant incomes over the past five years have helped create a dire situation for many of the country’s renters. A new report shows how ...

June 29, 2016, 9:03 am, 1649429

Standard & Poor’s decision to strip the United Kingdom of its AAA credit rating in the wake of the country’s vote to leave the European Union has highlighted once again the limited value of sovereign credit ratings.

Countries that have defaulted since 1975 had non-investment credit rating grades (below BBB) ...

June 29, 2016, 9:03 am, 1649428
The BEA released the Personal Income and Outlays report for May:

Personal income increased $37.1 billion, or 0.2 percent ... according to the Bureau of Economic Analysis. Personal consumption expenditures (PCE) increased $53.5 billion, or 0.4 percent.
Real PCE -- PCE adjusted to remove price changes ...

June 29, 2016, 8:44 am, 1649427

June 29, 2016, 8:04 am, 1649426
(Don Boudreaux)

My student Mark Lutter has a new blog – Free Cities Initiative – that will be excellent reading.  (Reason’s Brian ...

June 29, 2016, 7:34 am, 1649422

"Half of People Who Have Heart Attacks Don't Even Know It".

"Half of heart attack victims wait an hour before seeking help: Doctors warn that not enough people know the signs despite delays reducing the chance of survival".

"Could this widely used calculator be needlessly driving people to take

June 29, 2016, 7:34 am, 1649421

Maybe this happens at Jiffy Lubeonly once in a several hundred million times, but . . . it's not good.

June 29, 2016, 7:34 am, 1649420

One surprise for me: Lexus was 28th lowest out of 30.

June 29, 2016, 7:34 am, 1649419
Alexander Kroeger and Asani Sarkar

The Federal Open Market Committee implements monetary policy by ...

June 29, 2016, 7:23 am, 1649418

In a recent post, we looked at the advantages of free movement of labour. But, what about the problems which might arise from free movement of labour?

Firstly, free movement of labour depends on the area in question. To make an easy contrast, initially, the EU was free movement of ...

June 29, 2016, 7:23 am, 1649417

To what extent was Labour’s remain campaign insufficient?

It’s hard to say. Labour voters did vote 63% to remain, which compares to SNP (64%), Greens (75%) and Lib Dems (70%) and 42% Conservative. 4% for UKIP. How UK voted

Pros of campaign It started well with message that social and economic problems ...

June 29, 2016, 7:03 am, 1649399

When European Union negotiators sit down to talk trade deals, they have long been able to claim to represent the largest economy in the world. With all its member countries, the economy of the EU is larger than the United States and larger than China, by most measures.

Brexit is set to

June 29, 2016, 7:03 am, 1649398
From the MBA: Mortgage Applications Decrease in Latest MBA Weekly Survey

Mortgage applications decreased 2.6 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending June 24, 2016.
The Refinance Index decreased 2 percent from ...

June 29, 2016, 6:35 am, 1649397

The search for a new England manager, new Tory leader and perhaps new Labour leader too brings an under-appreciated question into focus: what exactly can leadership achieve?

In the Times today, Matthew Syed decries the “ludicrous idea that everything would be well if only we could find ...

June 29, 2016, 5:34 am, 1649396

"If you've ever been told that cooking 'burns off' any alcohol in the food you're eating, be forewarned: That's entirely untrue."

June 29, 2016, 5:03 am, 1649379

Although the data for recent months is still preliminary, it appears that the rapid inflation phase of the second bubble for new home prices in the U.S. ended in September 2015.

The second bubble for new home prices in the U.S. had gone through two primary ...

June 29, 2016, 4:05 am, 1649378

Offhand I can think of at least four.  I would suggest these as options to consider, rather than verified:

1. The comparative advantage of the largest nations is greater than before.  The UK stands relatively powerless vis-a-vis the EU, and the EU itself may be dissolving or at least weakening.  ...

June 29, 2016, 3:03 am, 1649362

June 29, 2016, 3:03 am, 1649361

Tim Duy:

Powell First Out Of The Gate, by Tim Duy: The first Fed speaker of the post-Brexit era delivered a decidedly dovish message. Confirming the expectations of market participants, Federal Reserve Governor Jerome Powell made clear that the Fed was in a holding pattern until the ...

June 29, 2016, 2:05 am, 1649358

Jacob Levy has a very good post on this topic, here is one bit from it:

There’s a level of popular belief that the EU enforces illiberal and market-unfriendly policies on Britain. On the fiscal side, here’s a comparison of British public spending as a share of GDP ...

June 29, 2016, 1:33 am, 1649357

….. is from Ludwig von Mises writing in his 1947 book “Planned Chaos” (emphasis mine):

In the market economy the consumers are supreme. Their buying and their abstention from ...

June 29, 2016, 12:34 am, 1649345

In Pennsylvania today Donald Trump said, “When subsidized foreign steel is dumped into our markets, threatening our factories, the politicians do nothing.”

This is false. President Bush imposed tariffs on imported steel in 2002. A month ago the Obama Administration imposed duties on Chinese steel of more than 200 percent and ...

June 29, 2016, 12:04 am, 1649344
(June 29, 2016 02:15 AM, by David Henderson) Last Friday, New York Times columnist Tom Friedman gave a talk at the Naval Postgraduate School, where I teach, and I had a front-row seat. Here are some impressions and responses to his talk. First, I arrived with a bias... (0 COMMENTS)

June 29, 2016, 12:04 am, 1649343
It is pretty clear who voted to stay and who voted to leave the EU in England. Hat Tip to Sam Wang Princeton Election Consortium Brexit survey of the day. “The UK voters who dominated the vote to Leave are also the ones who have to live with the outcome ...

June 28, 2016, 10:04 pm, 1649331
(Don Boudreaux)

… is from page 143 of the final volume (2016) – Bourgeois Equality – of Deirdre McCloskey’s ...

June 28, 2016, 9:03 pm, 1649325
NOTE: Fed Chair Yellen was scheduled to participate in a "Policy Panel" at the ECB Forum on Central Banking in Portugal on Wednesday. She has cancelled. Mark Carney, Governor of the Bank of England and Chairman of the G20's Financial Stability Board, has also cancelled.

• At 7:00 ...

June 28, 2016, 8:35 pm, 1649324

The Capital Spectator will be taking a long weekend to celebrate the 240-year-old USexit holiday, aka Independence Day for these United States. The usual routine resumes on Tuesday, July 5—directly after the July 4 fireworks have subsided and the ringing in your editor’s ears has receded to a low, dull ...

June 28, 2016, 8:04 pm, 1649321
The debate over whether the Fisher Effect is real has languished over the past year. It is hard to prove, and even I lost hope in it. However, I may have found the mechanism to make it work. First, look at this graph of the net profit rate plotted with ...

June 28, 2016, 7:03 pm, 1649305

Donald Trump used a big speech Tuesday at a metals-processing plant in western Pennsylvania to put more detailed policy meat on the bones of what critics have seen as his off-the-cuff brand of protectionism. Using a written script and a Teleprompter, Mr. Trump sought to tie Hillary ...

June 28, 2016, 6:34 pm, 1649304
Tags A A Home | Feed | Blog.rssGlobal EconomyPolitical TheoryAfter "Brexit," Can We Exit a Few Things Too?

June 28, 2016, 6:04 pm, 1649300
(Don Boudreaux)

This Thursday (June 30th), from 6:00 to 7:30pm, the Mercatus Center will host a reception to formally launch its new Program on the ...

June 28, 2016, 5:03 pm, 1649265
Earlier from the Richmond Fed: Manufacturing Sector Activity Declined; New Orders Decreased, Firms Continued to Increase Wages

Fifth District manufacturing activity weakened in June, according to the most recent survey by the Federal Reserve Bank of Richmond. New orders and shipments declined this month, while backlogs decreased further compared ...

June 28, 2016, 5:03 pm, 1649264
Fannie Mae reported today that the Single-Family Serious Delinquency rate declined in May to 1.38%, down from 1.40% in April. The serious delinquency rate is down from 1.70% in May 2015.

These are mortgage loans that are "three monthly payments or more past due or in foreclosure".

June 28, 2016, 4:44 pm, 1649263

June 28, 2016, 4:34 pm, 1649262
A A Tags Home | Feed | Blog.rssBig GovernmentLegal SystemPolitical TheoryWhy Large, Local Legislatures Are Better than the EU Parliament ...

June 28, 2016, 4:05 pm, 1649261

The Government of Canada has made it a top priority to re-establish and strengthen our relationship with one of our most important partners, Mexico. To this end, Prime Minister Trudeau today announced Canada’s intention to lift the visa requirement for Mexican visitors to Canada beginning December 1, 2016. Lifting ...

June 28, 2016, 4:04 pm, 1649260
Long-time Republican strategists and campaign consultants privately acknowledge they are so certain of Hillary Clinton’s victory – and so worried about its impact on Senate races and GOP control of the Senate – that they are already considering a controversial tactic that explicitly acknowledges Donald Trump’s defeat. The tactic, used ...

June 28, 2016, 3:33 pm, 1649256

It would be funny if it wasn't so messed up:

[Boris Johnson] suggested that Britain should take its time before entering separation proceedings with Brussels, and he gave no details about when he would want to start the process. And the vision he sketched out — of a Britain that is ...

June 28, 2016, 3:33 pm, 1649255

Again, if you haven't realized it yet, this little bit of deception by VW was not a very smart thing to do:

Volkswagen has agreed to pay up to $14.7 billion to settle claims stemming from its diesel emissions cheating ...

June 28, 2016, 3:33 pm, 1649254

Here’s the CD version of the WSJ‘s daily Notable and Quotable items:

1. “When Socialism Collapses” by the editorial board of the Augusta Chronicle:

Venezuela is seeing mass hunger, food riots and chaos. Yet, many on the American left are pining for the same brand of socialism.

And that’s exactly what Democrats ...

June 28, 2016, 3:03 pm, 1649223

I find it remarkable that, going by the numbers, economic policy uncertainty is now higher than after the bankruptcy of Lehman — and even higher than in the days after 9/11.

June 28, 2016, 2:34 pm, 1649222

June 28, 2016, 2:05 pm, 1649214

1. Tim Taylor on BrexitBernanke on Brexit.  And Angus defends Brexit.

2. Michael Pollan defends psychedelic drugs.

3. Georgiana Houghton at the Courtauld is one of the best and most revelatory exhibits I have seen.  Hardly anyone has heard of ...

June 28, 2016, 1:34 pm, 1649210

I last wrote about Fedwire data two years ago. Since then, Fedwire has entered into a (nominal) recession. Is this something we need to worry about?

June 28, 2016, 1:03 pm, 1649178

Today is June 28, the date in 2012 when the U.S. Supreme Court handed down NFIB v. Sebelius, upholding the Affordable Care Act as authorized under the Taxing Clause. Ours was one of the few briefs submitted that addressed that issue, and I predicted that Chief Justice ...

June 28, 2016, 1:03 pm, 1649177
Here is the earlier post on Case-Shiller: Case-Shiller: National House Price Index increased 5.0% year-over-year in April

The year-over-year increase in prices is mostly moving sideways now around 5%. In April, the index was up 5.0% YoY.

In the earlier post, I graphed nominal house prices, ...

June 28, 2016, 12:44 pm, 1649176

In contrast to the cacophony created by Brexit, EU authorities have been working for several years on a

June 28, 2016, 12:05 pm, 1649169

Fifty Japanese graduates opted to gamble with their job prospects at a mahjong tournament set up by recruiters looking for a different way to find the next high flyer.

Held in a crammed mahjong outlet in downtown Tokyo, prospects competed against each other on Friday (June 24) to gain the ...

June 28, 2016, 12:04 pm, 1649168
(June 28, 2016 12:59 PM, by David Henderson) One of my fantasies is of a classroom in which a tenured economics professor at an accredited institution of higher learning says, "We must have free trade," and a few students leap out of their chairs and shout, "You first!"... (1 COMMENTS)

June 28, 2016, 12:04 pm, 1649167
(Don Boudreaux)

Here’s a letter to WTOP Radio:

Apparently worried about a looming shortage of rental units in Montgomery County, ...

June 28, 2016, 11:03 am, 1649135

Last Friday, Congressional Republicans unveiled a tax plan that would make major changes to the U.S. tax system. So far, much of the news coverage has focused on the plan’s promise to “dramatically simplify our broken tax code.” But how, exactly, would the plan go ...

June 28, 2016, 11:03 am, 1649134

The International Monetary Fund recently cut its U.S. economic forecast the U.S., painting a bleak growth picture ahead without a major overhaul of the American economy.

Here are six charts that detail why the fund is so concerned, and the IMF’s prescriptions.

[wsj-responsive-sandbox id = "0" ]

A rising share of the workforce ...

June 28, 2016, 11:03 am, 1649133

I have a new column:

Why the Public Has Stopped Paying Attention to Economist: The predictions from economists about the consequences of Brexit were widely ignored. That shouldn’t be surprising. In recent years the public has lost faith the in the economics profession.

One reason for the lack ...

June 28, 2016, 11:03 am, 1649132
S&P/Case-Shiller released the monthly Home Price Indices for April ("April" is a 3 month average of February, March and April prices).

This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the monthly National index.

Note: Case-Shiller reports Not ...

June 28, 2016, 10:45 am, 1649131

June 28, 2016, 10:35 am, 1649130

The costs of fiscal austerity, and of this wretched government’s incompetence, are vastly higher than even its critics appreciate.

I say this because of a new paper by Markus Brueckner and Hans Peter Gruener which shows that “lower growth rates are associated with a significant ...

June 28, 2016, 9:23 am, 1649126

There are perhaps 16 million people who voted Remain and are now very unhappy at the decision to leave the EU. Feelings are so strong there are calls for a second referendum – 3 million signing a petition for a 2nd referendum.

However, if the initial referendum was over-turned, you would ...

June 28, 2016, 9:03 am, 1649094
From the BEA: Gross Domestic Product: First Quarter 2015 (Third Estimate)

Real gross domestic product -- the value of the goods and services produced by the nation’s economy less the value of the goods and services used up in production, adjusted for price changes -- increased at an annual ...

June 28, 2016, 8:44 am, 1649092

June 28, 2016, 8:44 am, 1649093

June 28, 2016, 8:35 am, 1649091

Next month’s “advance” GDP report for the US in the second quarter is widely projected to show that economic activity will rebound from Q1’s sluggish 0.8% gain (which is expected to be revised up to 1.0% in today’s revision, according to’s consensus forecast). But a higher level of macro ...

June 28, 2016, 8:04 am, 1649090
(June 28, 2016 07:06 AM, by Alberto Mingardi) Emily Skarbek has already offered very sound thoughts on Brexit - and David Henderson and Scott Sumner (as well as David Beckworth) are debating whether Brexit constitutes a monetary shock. I would just like to build on the point Emily... (1 COMMENTS)

June 28, 2016, 8:04 am, 1649089
(Don Boudreaux)

… is from pages 261-262 of Anthony de Jasay’s remarkable 1998 book, The State (original emphasis; footnotes deleted):

Since ...

June 28, 2016, 8:04 am, 1649088

June 28, 2016, 8:04 am, 1649087
by Barkley Rosser  (via Econospeak) The Tale of the Dragon Slayer The background for this tale is that I have just finished attending the 9th MDEF conference on Dynamic Modeling in Economics and Finance (actually, Modelli Dynamiche Economiche e Finanza) in Urbino, Italy.  Alan Kirman was in attendance and was much ...

June 28, 2016, 7:34 am, 1649082

Not good news for Chicago property owners. And this is worse:

But Moody's is saying this will only delay the inevitable. Chicago's unfunded pension liabilities are expected to grow for another ten years despite the massive tax increase.

June 28, 2016, 7:34 am, 1649083

Great. I really look forward to four more months of my phone ringing off the hook with stupid political calls.

June 28, 2016, 7:34 am, 1649080

June 28, 2016, 7:34 am, 1649081


There are two types of academics. Those who use the Oxford comma, those who don't and those who should.

Choose a discipline you love and you'll never work a day in your life likely because that field isn't hiring.

How many humanities professors does it ...

June 28, 2016, 6:35 am, 1649053

Brexit uncertainty continued to weigh on stock markets yesterday. Stratfor, a geopolitical consultancy, advises that the UK vote to leave the European Union may signal the start of a post-globalization world. Reva Goujon, a Stratfor analyst, writes that “global trade growth has been in structural decline since ...

June 28, 2016, 5:34 am, 1649051

I suppose this shouldn't be a surprise, but it is, kinda.

June 28, 2016, 5:03 am, 1649033

The U.S. Federal Reserve released its latest Flow of Funds report for the U.S. economy back on 9 June 2016, which we're finally getting around to today to give us a better idea of how the U.S. economy performed in the first quarter of ...

June 28, 2016, 5:03 am, 1649032

June 28, 2016, 5:03 am, 1649031

Jason Furman at ProMarket:

Productivity, Inequality, and Economic Rents: Productivity growth—a necessary (though not sufficient) condition for rising incomes in the long run—has slowed since 1973... At the same time, inequality in the United States is higher and, in recent decades, has risen faster than in other major advanced ...

June 28, 2016, 4:45 am, 1649030

June 28, 2016, 4:45 am, 1649029

June 28, 2016, 2:05 am, 1649008

…the surveys also revealed a lack of enthusiasm for buying or using a driverless car programmed to avoid pedestrians at the expense of its own passengers. One question asked respondents to rate the morality of an autonomous vehicle programmed to crash and kill its own passenger to save 10 ...

June 28, 2016, 2:05 am, 1649009

Here is from MIT Technology Review, surveying research on chess blunders and cognition by Ashton Anderson at Microsoft Research in New York City, Jon Kleinberg of Cornell, and Sendhil Mullainathan:

…Anderson and co have found evidence of an entirely counterintuitive phenomenon in which skill levels play the opposite ...

June 28, 2016, 12:34 am, 1648997
Tags A A Home | Feed | Blog.rssFinancial MarketsGlobal EconomyPolitical TheoryWhy All the Post-Brexit Hysteria?