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Commentary | Uncategorized

A Job Boom That Left Many Out

Job growth in the United States was distinctly uneven for decades before the Pandemic hit, a fact that was emphasized this week when the Bureau of Labor Statistics released a list of when each county in the United States reached its highest employment, based on data from 1975 to 2020. It showed that only 27% […]

CFE Analysis

Steeling Ourselves for Less Steel Use in China

 Herbert Stein, former Chair of the U.S. Council of Economic Advisors for R.M. Nixon, reminded his colleagues that “if something cannot go on forever, it will stop”. History is littered with speculators who went broke, betting against clearly unsustainable trends but forgetting that forever is a long time.  Which brings us to the Chinese Real […]

CFE Analysis

Only Two Months of Pain? Not Even Close

The Pandemic recession lasted two months, the National Bureau of Economic Research decided this week—more than a year after the supposed end of the recession in April 2020.  That is the shortest recession ever, according to the NBER, which has a list of 34 recessions going back to 1857. But this recession made up for […]

CFE Analysis

Does the 2021 Boom Lock the U.S. into 2023-2025 Gloom?

The Congressional Budget Office has issued some dire forecasts about the U.S. economy, which is causing alarm in some quarters.  But do those forecasts make sense? As Andrew Van Dam wrote in the Washington Post: “CBO now projects growth will slow to 1.1 percent in 2023 and an average of 1.2 percent in 2024 and 2025 — […]

CFE Analysis

Jobs Easy To Get, They Say

Americans are more enthusiastic about the job market than they have been at any time in the past half century. And yet the official unemployment rate is well above what it was during comparable times in the past. The Conference Board, as part of its Consumer Confidence study, each month asks people what they think […]

CFE Analysis | Fed

Some Simple Term Structure Arithmetic

Robert J. Barbera and Jonathan H. Wright We’ve written two pieces recently on Treasury yields amid the COVID recovery.  Wednesday’s  release of the Federal Reserve Open Market Committee’s Survey of Economic Projections is an opportunity to review where ten yields are, and where they may be headed. The median FOMC participant projects a funds rate […]

CFE Analysis

Not so fast about the bond vigilantes

There is much excited talk in the press these days about the rise in ten-year yields to 1.5 percent and the rise to 2 percent for the breakeven inflation rates expressed when we comparing Treasury nominal and TIPS yields. The bond vigilantes are back! Another Great Inflation around the corner!

CFE Analysis

Recovery, Expansion, and an Old Normal Yield Curve

In December of 2019, the U.S. unemployment rate stood at 3.6% and prime age labor force participation, at 82.9%, was at an 11 year high. Today, December 2020 jobs figures were released, with unemployment at 6.7% and participation at 81%, both making it clear that today’s economic backdrop is bleak. These data also make clear that engineering an extended period of strong growth is highly justifiable.

CFE Analysis

The Year of the Pink Slip

How bad a year was 2020? During the year, the United States economy lost a net 9.4 million jobs — 6.2% of the jobs it had at the end of 2019. That is by far the largest annual decline since 1950. The years that included the financial crisis more than a decade ago had seen the largest losses of jobs, with a 3.7% decline in 2009 following a 2.6% fall in 2008. The year just ended was a little worse than the two of them combined.