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

September 30, 2016, 9:03 am, 1679792
The BEA released the Personal Income and Outlays report for August:

Personal income increased $39.3 billion (0.2 percent) in August according to estimates released today by the Bureau of Economic Analysis. ... personal consumption expenditures (PCE) increased $6.2 billion (less than 0.1 percent).
Real PCE decreased 0.1 ...

September 30, 2016, 8:34 am, 1679791

Volatility Managed Portfolios
Alan Moreira and Tyler Muir (Yale University)
June 18, 2016
Managed portfolios that take less risk when volatility is high produce large alphas, substantially increase factor Sharpe ratios, and produce large utility gains for mean-variance investors. We document this for the market, value, momentum, profitability, return ...

September 30, 2016, 7:33 am, 1679787

The Velvet Underground. This is the longer, more up-tempo--better--version.

September 30, 2016, 7:33 am, 1679786

"Because you’re never too young to bring the LOLs."

September 30, 2016, 7:33 am, 1679785
Anna Snider

In recent months, there have been some high-profile assessments of how far the Federal Reserve has come in terms of communicating about monetary policy since its “secrets of the temple” days. While observers say the transition to greater transparency “still seems to ...

September 30, 2016, 6:44 am, 1679771
David Wessel: In the not-so-distant past, the IMF was derisively labeled “It’s Mostly Fiscal” for its unwavering advice to governments to cut their budget deficits. Those days have clearly passed.

September 30, 2016, 5:33 am, 1679769

I don't know whether it's admirable consistency or plain crazy, but after 43 years Angus is still performing and still performing in his schoolboy uniform.

September 30, 2016, 5:03 am, 1679757

Not long ago, Katie Burke suggested in American Scientist that the term pseudoscience should stop being used, arguing that:

Using the term pseudoscience... leads to unnecessary polarization, mistrust, disrespectfulness, and confusion around science ...

September 30, 2016, 3:03 am, 1679737

September 30, 2016, 2:34 am, 1679736

I really liked the ECB’s recent report on the slowdown in global trade (summarized here), for five reasons.

1) It doesn’t assume that trade should always grow faster than output. A liberalization of trade (or a fall in transportation costs—or less attractively, new opportunities to take advantage of transfer ...

September 30, 2016, 2:04 am, 1679734

People, I do think there is a uniquely bad figure on the American national scene right now, and I am hoping for that figure to leave the stage very soon.  Nonetheless intellectual honesty and the pursuit of truth require me to communicate the following result to you.  This is ...

September 30, 2016, 2:04 am, 1679735

Joel Slemrod goes through the details (pdf), including a discussion of a co-authored 1990 paper by Feldstein and Krugman, and also the Lerner theorem.  As you might expect, there is much wisdom, and microeconomics, in that six-page piece.  His answer on the tax ...

September 30, 2016, 12:04 am, 1679722

Join AEI for a two-day conference, highlighting several mortgage and collateral risk measures and their applications. International experts from a variety of backgrounds will share lessons learned from their efforts to objectively measure housing risk.

Since the financial crisis, researchers have been using big data to develop objective, timely, and detailed ...

September 29, 2016, 11:33 pm, 1679721

September 29, 2016, 9:03 pm, 1679712
From Merrill Lynch: Elections: what keeps us up at night?

The US elections are quickly approaching and, in our view, have become one of the most significant near-term risks for the economy and markets. The facts are changing quickly, both in terms of the policies that each candidate supports ...

September 29, 2016, 8:34 pm, 1679711

September 29, 2016, 7:33 pm, 1679708

From the inbox:

Dear Colleague,

I am writing to let you know that one or more of your papers was cited in issue 3 of volume 3 of the J. of the Association of Environmental and Resource Economists (JAERE). I have attached a PDF of the paper; the authors and title are:

Laura ...

September 29, 2016, 7:03 pm, 1679698
Fannie Mae reported today that the Single-Family Serious Delinquency rate declined in August to 1.24%, down from 1.30% in July. The serious delinquency rate is down from 1.62% in August 2015.

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

September 29, 2016, 6:04 pm, 1679697
(September 29, 2016 05:17 PM, by Scott Sumner) Polls show that 58% of Americans favor the legalization of marijuana. Even Texans support it. But an initiative to legalize pot in (very liberal) Massachusetts may fail. One reason is anti-legalization editorials like the following, in the highly influential Boston... (0 COMMENTS)

September 29, 2016, 6:04 pm, 1679696
I posted this graph yesterday which has 234 data points from 1954 to 2016… The graph implies that as profit rates come easier over the nominal cost of money the percentage of gross private investment to GDP tends downward. I tweeted this graph to Miles Kimball who is in favor ...

September 29, 2016, 6:04 pm, 1679695

As I’ve said before, higher education reform increasingly feels like a rerun of the past two decades of K-12 reform—only on a 15 year time delay. In the past few years, President Obama and now Hillary Clinton have issued proposals that would give Washington unprecedented sway over higher ed, and ...

September 29, 2016, 5:33 pm, 1679691

Sign me up ANC!

Audubon North Carolina said it will soon reach out to private landowners across Watauga County to encourage them to protect and restore priority bird habitats, while simultaneously helping landowners enhance their property in cost-effective and sustainable ways.

// ...

September 29, 2016, 5:33 pm, 1679690

1. Chart of the Day I (above). Thanks to the shale gas revolution and cheap natural gas, we’re in the middle of the “great reversal” as ...

September 29, 2016, 4:04 pm, 1679658
(September 29, 2016 02:03 PM, by Amy Willis) In a campaign season here in the United States that seems more like a shouting match than politics, this week's EconTalk episode raises an interesting question. According to guest John Cochrane, a.k.a. The Grumpy Economist, the main issue that... (0 COMMENTS)

September 29, 2016, 4:04 pm, 1679657
Coming soon: President Barack Obama, who’s expected to campaign [in Florida] at least twice before Election Day. First Lady Michelle Obama — more popular than her husband — will likely visit Florida as well, in addition to the ad she cut for Clinton that’s currently airing on Florida radio. “Hillary Clinton’s ...

September 29, 2016, 4:04 pm, 1679656

Welcome to the American Enterprise Institute’s spotlight on the 2016 election! This page features current analysis of the 2016 presidential campaign from AEI’s election experts. It also houses AEI’s 2016 data points series and Political Report archives. Together, these materials are a comprehensive resource for historical analysis of the American ...

September 29, 2016, 4:04 pm, 1679655

A new study of a conditional cash transfer program in New York City and Memphis, Tennessee, raises questions about the employment effects of government transfers that are not tied to work.

Family Rewards 2.0 was a conditional cash transfer program ...

September 29, 2016, 3:33 pm, 1679652

September 29, 2016, 3:03 pm, 1679620

California’s state Legislative Analyst's Office (LAO) is out today with a comprehensive review of the impact of the state’s film tax credit program. Their report reviews the program as it existed from 2009 to 2014, before a change that year both boosted the amount of credits awarded (from $100 ...

September 29, 2016, 3:03 pm, 1679619

U.S. agricultural exports have surged the past two months, helping cut the trade deficit and boosting the outlook for short-term economic growth.

One big factor? Soybeans. Bumper harvests at home, crop shortfalls in South America and solid demand—especially from China—have propelled international feed sales.

Soybean exports will add about 1% to ...

September 29, 2016, 3:03 pm, 1679617

Greg Mankiw:

Trumponomics: Regular readers of this blog know that I often disagree with Paul Krugman. But I come here today agree with a recent post of his on the analysis put out by two Trump economic advisers. The Trump advisers' analysis is truly disappointing (though perhaps ...

September 29, 2016, 3:03 pm, 1679618

Paul Krugman:

A General Theory Of Austerity?: Simon Wren-Lewis has an excellent new paper trying to explain the widespread resort to austerity in the face of a liquidity trap, which is exactly the moment when such policies do the most harm. His bottom line is that austerity ...

September 29, 2016, 3:03 pm, 1679616

Larry Summers:

The decline of the middle class is causing even more economic damage than we realized: I have just come across an International Monetary Fund working paper on income polarization in the United States that makes an important contribution to the secular stagnation debate. The authors ...

September 29, 2016, 3:03 pm, 1679615
The Case-Shiller house price indexes for July were released Tuesday. Zillow forecasts Case-Shillera month early, and I like to check the Zillow forecasts since they have been pretty close.

From Zillow: August Case-Shiller Forecast: New Home Price Peaks Within Sight

According to Zillow’s August Case-Shiller forecast, ...

September 29, 2016, 2:04 pm, 1679614

September 29, 2016, 2:04 pm, 1679613

You’ve heard and read by now lots of spin and speculation about who won and where the polls are going to move after Monday’s presidential debate. We’ll know the answers to these questions soon. The more important question for the long run is how each of these candidates would govern. ...

September 29, 2016, 1:33 pm, 1679606


From YouTube:

From Academy Award®-winning filmmaker Fisher Stevens and Academy Award-winning actor, and environmental activist Leonardo DiCaprio, BEFORE THE FLOOD presents a riveting account of the dramatic changes now occurring around the world due to climate change. BEFORE THE FLOOD will be in ...

September 29, 2016, 1:03 pm, 1679575

Today is September 29, the date in 1789 when the first session of Congress adjourned after a 209-day session that included establishing the Departments of State, War, and Treasury; passing the Judiciary Act; and imposing a revenue tariff. Congress did not meet again until January 1790.

Here are some ...

September 29, 2016, 12:44 pm, 1679574

September 29, 2016, 12:44 pm, 1679572

September 29, 2016, 12:44 pm, 1679573

September 29, 2016, 12:04 pm, 1679563

That is my latest Bloomberg column, here is one excerpt:

Self-driving vehicles are also likely to help the suburbs most. One of the worst things about the suburbs is the commute to the city or to other parts of the suburbs. But what if you could read, text or ...

September 29, 2016, 12:04 pm, 1679562

Taking a test on a hot and polluted day can result in a measurably lower score which, if the test is for something like a university entrance exam, can have permanent consequences. I find both of these results hard to believe which doesn’t necessarily mean that they shouldn’t be ...

September 29, 2016, 12:04 pm, 1679561
(September 29, 2016 12:16 PM, by David Henderson) In a very pessimistic essay about America's future, my former Hoover colleague Angelo Codevilla writes: What goes by the name "constitutional law" has been eclipsing the U.S. Constitution for a long time. But when the 1964 Civil Rights Act substituted... (0 COMMENTS)

September 29, 2016, 12:04 pm, 1679560

Given the good news in the Census Bureau’s annual report on poverty and income, can we conclude that minimum wage increases have proven their benefits? To consider, let’s take a step back and recall that an underlying reality of minimum wage increases is a familiar one in economics: tradeoffs.

Raising ...

September 29, 2016, 12:04 pm, 1679559


This paper advocates for a market-rate, unsubsidized approach for producing economical rental housing largely intended for service and line-production workers—workers that account for 38 percent of national private and public jobs. The paper includes primers on rental housing economics and policies and a report on efforts ...

September 29, 2016, 12:04 pm, 1679556

For the first time of his presidency, Congress overrode President Barack Obama’s veto of the Justice Against Sponsors of Terrorism Act (JASTA). As my colleagues, Danielle Pletka and Ambassador John Bolton point out, the law could “endanger Americans” by creating an exception to the concept of sovereign immunity that fundamentally won’t get ...

September 29, 2016, 12:04 pm, 1679557

In a recent editorial in support of a carbon tax, The Washington Post complains that “Americans are burning record amounts of gasoline,” arguing that “one of the most glaring … flaws” of the “Environmental Protection Agency fuel-efficiency mandates” is the reality that the regulations “cannot control how much ...

September 29, 2016, 12:04 pm, 1679558

Three months after the Brexit vote, it’s time for the UK’s leaders to “get this country moving again,” as JFK once exhorted Americans. Or “make Britain great again,” per Donald Trump, if you prefer.

Brexit was undeniably a revolution in human affairs, opening up vistas for Britain once buried in European Union ...

September 29, 2016, 11:33 am, 1679555
Regular readers of this blog know that I often disagree with Paul Krugman. But I come here today agree with a recent post of his on the analysis put out by two Trump economic advisers. The Trump advisers' analysis is truly disappointing (though perhaps not surprisingly so, given ...

September 29, 2016, 11:03 am, 1679524
From the NAR: Pending Home Sales Retreat in August

After bouncing back in July, pending home sales cooled in August for the third time in four months and to their lowest level since January, according to the National Association of Realtors®.

The Pending Home Sales Index, a forward-looking ...

September 29, 2016, 10:44 am, 1679523

September 29, 2016, 10:44 am, 1679522

September 29, 2016, 10:04 am, 1679520

Page to support Annual Dinner Spotlight:

September 29, 2016, 9:03 am, 1679488

The U.S. is a hotbed of “knowledge capitals,” according to a new analysis of the world’s largest cities.

The new cluster analysis of more than 100 of the world’s biggest metro areas and their economies shows seven distinct types, from finance-driven giants like New York to gateways for emerging regions like ...

September 29, 2016, 9:03 am, 1679486
The DOL reported:

In the week ending September 24, the advance figure for seasonally adjusted initial claims was 254,000, an increase of 3,000 from the previous week's revised level. The previous week's level was revised down by 1,000 from 252,000 to 251,000. The 4-week moving average was 256,000, a ...

September 29, 2016, 9:03 am, 1679487
From the BEA: Gross Domestic Product: Second Quarter 2016 (Third Estimate)

Real gross domestic product increased at an annual rate of 1.4 percent in the second quarter of 2016 (table 1), according to the "third" estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP ...

September 29, 2016, 8:34 am, 1679485

Correlations between asset classes have been trending up lately, a directional bias that could be a warning sign, according to several market observers.

Michael Harris at the Price Action Lab Blog yesterday advised that “the 60-day stock-bonds correlation spiked this month from about -0.50 to +0.20. A ...

September 29, 2016, 7:34 am, 1679483

You are driving a car with rear-wheel steering and no reverse gear. You are driving alongside a wall. If you drive too close to the wall you are trapped, because you would need to steer your rear wheels into the wall in order to get your front wheels to move ...

September 29, 2016, 7:33 am, 1679480

From the New York Times. Not listed is one of my faves, "Apple, Fennel and Endive Salad with Feta".

September 29, 2016, 7:33 am, 1679482

I think this is just an attempt to be funny, but I admit that these days, I'm less and less sure.

September 29, 2016, 7:33 am, 1679481

Old-timers like me remember the huge to-do when Billie Jean King beat Bobby Riggs. What they--and I--might not have known is that the match was probably fixed.

September 29, 2016, 7:03 am, 1679459

In the course of our projects, we occasionally come across data that is pretty interesting in and of its own accord. In the following chart, we've opted to show the cumulative distribution of individual income for the United States, China and the World, as expressed ...

September 29, 2016, 6:04 am, 1679458
(Don Boudreaux)

… is from Bryan Riley’s excellent 2016 essay “How Americans Benefit from Trade“:

Someone said NAFTA could have been ...

September 29, 2016, 5:33 am, 1679455

Interesting but unsurprising if you read my 2009 post.

September 29, 2016, 4:04 am, 1679440

Here are two notable excerpts:

The windows were usually clamped shut and the blinds were often drawn; one of Rand’s cats had jumped to an untimely death, condemning visitors thereafter to endure the stuffy air in her apartment.

Are cats that stupid?  (Did not Aristotle describe the cat as ...

September 29, 2016, 3:03 am, 1679418

September 29, 2016, 2:04 am, 1679417

Part of me feels no, we should not let up on the worry, it does seem truly bad.  And yet, when I look at market prices, I don’t see such a high level of gloom or angst.  Here is my latest Bloomberg column, it makes a number ...

September 29, 2016, 12:04 am, 1679405

Each year, Americans give more than $350 billion to charity. In addition to the religious and educational institutions at the center of American ...