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 […]
News & Announcements Archive
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 […]
Zero Bound
The outlook for growth in employment and corporate earnings over the next few years is headed down. The problem is not what the Federal Reserve will do, or what a Democratic (or Republican) Congress is likely to do, or the possibility of a mushrooming trade war. It is the unsustainable nature of what has caused […]
Workers Return, Oldsters Retire, and the Jobless Rate Continues to Fall.
Five percent was the magic number. For years after the Great Recession officially ended in 2009, the recovery seemed to be proceeding at a snail’s pace. Even as the unemployment rate fell, it appeared that millions of Americans who had lost work during the recession had given up on looking for jobs. There were worried […]
What did We Learn from Recent Monetary Policy Performance?
A growing chorus of commentators are now issuing warnings about additional Fed tightening in light of the flattening Treasury yield curve. Despite clear evidence that job growth in the U.S. is running well ahead of a sustainable pace, low wage and price inflation, for many suggest no need to firm overnight interest rates. Exhibits A […]
The slope of the yield curve and lessons from recent history
A downward sloping yield curve is widely seen as a harbinger of recessions, and indeed has an impressive track record. The yield curve inverted before the last two recessions and is likely to invert again within less than a year, which naturally raises fear of another recession. Much commentary of late has noted that yield […]
A higher loyalty
After over a decade of first-rate stewardship, Jon Faust is resigning from his post as CFE Director to become senior special advisor to the newly appointed Federal Reserve Board Chair, Jerome Powell. Ordinarily one protests the exit of an esteemed colleague. However, in his new role, Jon will be immersed in debates of the utmost […]
CFE blog gets some notice
This blog has recently been listed on the Intelligent Economist’s list of the Top 100 economics blogs.