By Kevin Heerdt and Jonathan H. Wright Economic data released by the government and other entities are being distorted by normally acceptable statistical methods. The extreme economic data that are coming out raise important issues of seasonal adjustment. Of course, there is no questioning the fact that the economic data are bad in an unprecedented […]
Category: CFE Analysis
Votes, deaths and layoffs
There are 50 states, but only 13 where the 2016 presidential election was decided by a margin of less than eight percentage points. Six of them went for Hillary Clinton and seven for Donald Trump. It is likely that this year’s election will be largely decided in those states. So how are they faring in […]
Market Volatility
Get ready for another crazy month on Wall Street. Months like March tend to come in pairs, at least as far as volatility goes. Daily moves of 4% or more are usually rare for the S&P 500; there were only ten of them in the entire decade of 2010 through 2019. In March, there were […]
The best kind of stimulus
No sooner was the ink dry on the March 27 $2 trillion stimulus package than Washington began work on the next stimulus. This is the right thing to do. Deficit hawks who worry about the debt-GDP ratio should want it, because without further stimulus, the debt-GDP ratio will soar because of crumbling GDP. Both President […]
COVID-19 Data: Signal versus Noise
Two burning questions confront all of us: How big is our public health problem? How sharp is our economic retrenchment? We think that the toolkit of economic forecasters has something to offer on the scale of the public health problem. Ignore the frantic quotes focused on reported COVID-19 cases—the numbers are all but meaningless. Instead, […]
Embracing Distancing and Cushioning the Blow to the Economy
The global COVID-19 outbreak now sports exponential growth rates for cases and deaths on every continent save Antarctica. Students of the economy must add that we are also in the midst of an unprecedented blow to global output, income, and employment. In financial markets, the pace of decline for equity and corporate bond prices exceeds […]
Trump stocks
President Trump has frequently pointed to the performance of the stock market in praising his own performance, although not in the past week when markets worldwide came down with (fears of) the coronavirus. Even at the end of the market’s worst week since 2008, the S&P 500 has still risen at a compound rate of […]
China’s 2018 Economic Slowdown: Much Worse than the Official Tally
By Robert Barbera and Yingyao Hu Our nighttime illumination estimate for 2018 Chinese growth, 4.2%, is roughly one third weaker than the Chinese official claim of a 6.5% climb for real GDP. In December of last year we introduced a new measure for China’s real income gains. The unique aspect of our effort reflects our […]
Memo to the Fed: Remember 2008
One thing I learned during more than 40 years as a journalist is that the power to set the terms of the debate sometimes can be decisive in determining the outcome of the debate. That could be happening now with monetary policy. By loudly demanding that the Federal Reserve lower interest rates – and announcing […]
Homeownership
The housing crisis from a decade ago is fading from consciousness for many Americans. But the ill effects of it are still apparent, particularly for those who bought homes in the years from 2005 to 2007. They paid high prices, and many mortgages had ominous terms that made repayment highly unlikely. The problem is most […]
A Surprising – And Ominous? — Boom
There has been much talk about the death of bricks-and-mortar retail, which traditionally hires hundreds of thousands of temporary workers in November and December for the Christmas rush. With more and more business being conducted online, it stood to reason that general merchandise stores — the Macy’s and Targets of the world — would be […]
Gangbusters Jobs Growth and No Fed Tightening. A Snapshot Unlikely to Persist.
President Trump tweeted on Christmas Eve that he was “all alone (poor me).” It was a sentiment with which Fed Chairman Jerome Powell could sympathize. As 2018 came to a close, the president blasted Powell for raising interest rates and causing the stock market to plunge. Wall Street pundits warned that swooning share prices suggest […]