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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November 29, 2015, 5:03 am, 1583143

November 29, 2015, 4:04 am, 1583142
My regular column is available to subscribers on This is an excerpt. It is five days since the autumn statement and spending review but it is not too late to give credit to the man who made it...

November 29, 2015, 3:23 am, 1583141

Photo Credit: Mary Merkel || I am busy all of the time

Every 100 posts or so, every year or so, I take a small break from covering the markets to ...

November 29, 2015, 2:04 am, 1583118

That is the paper’s subtitle, the title is “An Offer You Can’t Refuse,” and that is the job market paper (pdf) of Sandro Ambuehl of Stanford University.  I found this to be the most interesting job market paper of the year, noting that “most interesting” and ...

November 28, 2015, 10:44 pm, 1583101
After more than five years, negotiations surrounding the Trans-Pacific Partnership (TPP) have finally been concluded. Yet, there is a lot that needs to be done before the agreement comes into force, and there is no certainty that it will. This column examines what TPP has achieved so far, what it ...

November 28, 2015, 10:44 pm, 1583100
As a result of the oil price plunge, the major oil-exporting countries are facing budget deficits for the first time in years. This column goes through the evidence, suggesting that the low price environment is likely to test the relationship between governments in oil-exporting countries and their sovereign wealth funds, ...

November 28, 2015, 9:34 pm, 1583096
Scott Sumner passes on a wise comment from his blog:

...the main problem in America is that the public, including its highly educated members, is social-scientifically ignorant. Most people I talk to about policy do not even realize that there is anything non-trivial about policy analysis. They want ...

November 28, 2015, 9:33 pm, 1583095
I don't like to leave Los Angeles. I only fly away when I anticipate that I might learning something at my destination. On December 9th, I'll have an opportunity to sit down with Professor Paul Romer of NYUto discuss China. My parents will be there and they are ...

November 28, 2015, 8:04 pm, 1583094
An alterative title might be my usual comment reminding Krugman’s readers of the history of “hysterisis”. Krugman wrote a very clear even better than usual post summarizing how his views on macroeconomics have changed since 2008. It is best to click the link, but the one sentence summary is that ...

November 28, 2015, 7:33 pm, 1583093
French Regional Elections are coming up on December 6 and December 13.

At stake are the presidencies of the 18 Regions of France. 12 Regions are on continental France, plus Corsica and 5 more overseas.

The regions do not have legislative autonomy, but they do ...

November 28, 2015, 3:34 pm, 1583074
Nathaniel Popper at the New York Times Dealbook, writes "Dream of New Kind of Credit Union Is Extinguished by Bureaucracy" It's a worthy addition to the series of anecdotes on how regulation, especially discretionary actions of regulators, are killing investment and businesses.

Again, we collect anecdotes as a ...

November 28, 2015, 3:03 pm, 1583057

Paul Krugman on macroeconomic models:

Demand, Supply, and Macroeconomic Models: I’m supposed to do a presentation next week about “shifts in economic models,” which has me trying to systematize my thought about what the crisis and aftermath have and haven’t changed my understanding of macroeconomics. And it seems to ...

November 28, 2015, 2:04 pm, 1583054

Chinese billionaire Liu Yiqian, who doesn’t exactly struggle to afford a plane ticket, can now likely fly free, in first class, with his whole family, anywhere in the world, for the rest of his life.

All because he bought a painting.

Liu was the winning bidder for Amedeo Modigliani’s Reclining Nude at a ...

November 28, 2015, 2:04 pm, 1583053
(November 28, 2015 02:20 PM, by David Henderson) However, increased consumption among youths leads to negative externalities. Raising the share of adults registered as medical marijuana patients by one percentage point increases the prevalence of recent marijuana use among adolescents and young adults by 5-6% and generates negative... (7 COMMENTS)

November 28, 2015, 1:33 pm, 1583050
The recovery in France appears to have stalled already, and this is from employment data before the terrorist attacks. Via translation from Les Echos ...

The number of Class A unemployed rose by 42,000 last month. This is the largest increase in nearly three years. Overseas included, ...

November 28, 2015, 12:04 pm, 1583028

Last week, House and Senate conference negotiators settled on a final framework to rewrite the No Child Left Behind (NCLB) Act. NCLB was passed in 2001 to reauthorize the Elementary and Secondary Act (ESEA) of 1965, but ultimately led to over-testing, misguided accountability systems, and federal micromanagement of ...

November 28, 2015, 12:04 pm, 1583029

The Consumer Financial Protection Board has jumped into the retirement planning game, releasing an online Social Security tool to help Americans estimate their retirement benefits. The CPFB’s benefit tool is much-needed: the Social Security benefit formula is so complex that many Americans have no idea what they will receive until the first ...

November 28, 2015, 12:04 pm, 1583025

In recent days, a bunch of smart people — including at AEI — have addressed the apparent productivity paradox that makes our economy so hard to gauge right now. Silicon Valley is booming, and yet productivity growth is tepid. But if productivity growth is so awful, then how can ...

November 28, 2015, 12:04 pm, 1583024

I always enjoy looking at rankings of the best and worst places to live. Inevitably, I want to know where my current state (New York) falls and my state of birth (Wisconsin). According to a new ranking from 24/7 Wall St (an online financial and opinion news source), both ...

November 28, 2015, 12:04 pm, 1583027
Massachusetts has announced the intention to abandon its steadfast commitment to the Common Core K–12 curriculum standards. Last week, on the recommendation of state education commissioner Mitchell Chester, the state’s education board decided to revamp its famed Massachusetts Comprehensive Assessment System (MCAS) and drop plans to retire MCAS for the ...

November 28, 2015, 12:04 pm, 1583023

It’s not only the GOP that’s deeply divided these days. In a new Time magazine piece, “Hillary Clinton’s Middle-Class Tax Pledge Divides Democrats,” reporter Sam Frizell highlights a major fissure within the Democratic Party (italics mine):

Among the various policy ideas and position papers put out by Hillary Clinton so ...

November 28, 2015, 12:04 pm, 1583026

The big surprise in Tuesday’s downing of a Russian fighter jet by the Turkish air force is that it hadn’t happened earlier.

November 28, 2015, 12:04 pm, 1583022

It has now been four years since the US withdrew its forces from Iraq. Earlier this month, I spent a couple weeks in southern Iraq and Baghdad independent from any US government agency or security restriction.

November 28, 2015, 12:04 pm, 1583017

There is now widespread agreement that the nation should more effectively fight poverty and promote economic mobility. Republicans and Democrats, including the presidential candidates, are offering proposals for attacking both problems. But political polarization and legislative gridlock in the nation’s capital make action seem unlikely.

Determined to show that people of ...

November 28, 2015, 12:04 pm, 1583019

This event has been postponed.

China’s dramatic economic growth over the past 35 years has many legitimate sources. But Chinese policies are increasingly characterized by an aggressive innovation mercantilism, which unfairly advantages their domestic industries at the expense of foreign competitors, especially in the technology sector.

Will such policies — including standards ...

November 28, 2015, 12:04 pm, 1583018

The traditional political and policy battles over medical malpractice reform usually follow well-rehearsed scripts highlighting the relationships among the risk of lawsuits, defensive medicine and physician supply responses, and damage cap remedies.

Join AEI for a forum examining more recent research that suggests several empirical cracks in this storyline. Our panel ...

November 28, 2015, 12:04 pm, 1583021

As noted in numerous stories about the Paris attacks, the scale and numbers involved point toward a fairly large conspiracy that went without detection by the French security services.

As any domestic intelligence officer will tell you, the larger the numbers involved, and the greater the logistics trail, the more likely ...

November 28, 2015, 12:04 pm, 1583020

1. Chart of the Day I (above). Earlier this year, the city of Los Angeles passed the “Los Angeles Hotel Minimum Wage Ordinance,” which raised the city’s minimum wage for hotel workers to $15.37 an hour on July 1. According to BLS industry ...

November 28, 2015, 11:03 am, 1583001
The key report this week is the November employment report on Friday.

Other key indicators include November vehicle sales, the November ISM manufacturing and non-manufacturing indexes, and the October trade deficit.

Federal Reserve Chair Janet Yellen will speak on the Economic Outlook.

----- Monday, November 30th -----

November 28, 2015, 10:34 am, 1583000

Almost everyone seems to have an opinion about whether (pdf) or not to bomb ISIL*. Are they really all experts on the complexities of Syrian military and political affairs?

Maybe not. There's another possibility: overconfidence. We tend to exaggerate our knowledge and under-estimate ...

November 28, 2015, 10:34 am, 1582999

With much of Europe worried about terrorism and refugees, there hasn’t been much attention paid to the financial issues that have gripped many of the continents weaker members, but that may be about to change ...

November 28, 2015, 10:04 am, 1582994
(Don Boudreaux)

Here’s a letter to a long-time patron of Cafe Hayek:

Mr. Kevin Martin

Mr. Martin:

Recollecting that your Econ 101 course at ...

November 28, 2015, 9:33 am, 1582992
Toward a Pigouvian Stateby Jonathan Masur and Eric Posner in the University of Pennsylvania Law Review.

November 28, 2015, 9:33 am, 1582991

Greg Mankiw:

Noah Smith takes the standard course to task. David Henderson says, not so fast.


The title to this post (without the question mark) is the assertion made by Noah Smith last week. He laments the fact that principles of microeconomics courses might overstate some of the ...

November 28, 2015, 9:03 am, 1582970

November 28, 2015, 8:04 am, 1582969

1.”$50bn Nicaragua canal postponed as Chinese tycoon’s fortunes falter“; I say “postponed” is a very polite word to use there.

2. Dialogue of Brian Eno with Varoufakis, it ends with:

YV No, I must get on. I have to meet

November 28, 2015, 8:04 am, 1582968
(Don Boudreaux)

… is from pages 228-229 of the 1975 collection of some of Harry Johnson‘s essays, On Economics and Society; specifically, ...

November 28, 2015, 5:33 am, 1582957

(p. A17) Full-time employment is technically defined as more than 35 hours. This raises an obvious problem: A simple side-by-side comparison of all men and all women includes people who work 35 hours a week, and others who work 45. Men are significantly more likely than women to ...

November 28, 2015, 3:03 am, 1582933

November 28, 2015, 2:04 am, 1582932

Rosanna Smart, a job market candidate from UCLA, has a very interesting job market paper (pdf) on this question.  Here is the abstract:

Almost half of the US states have adopted \medical marijuana” laws (MMLs),and 58% of Americans now favor marijuana legalization. Despite public support, federal law ...