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From: Erwan Mahé ” This is why one of the only ways to get out of the current mess is to bring together all the major decision-making states in Europe, including Germany, to decide on a clear-cut stimulus programme, minus the sterile Maastricht criteria.” Brexit shock. And now what? All the investment scenarios have been shaken in the wake of the surprise victory of the Leave forces in the Brexit referendum last Thursday. The many discussions I have held with clients since the referendum...

from David Ruccio The U.S. economy is a remarkable success according to the standards of neoclassical economic theory. Yet, for “prime-age” men, who need to work to provide for themselves and their families, it is increasingly a failure.   That’s the clear lesson from the latest report from the Council of Economic Advisors (pdf) on “The Long-Term Decline in Prime-Age Male Labor Force Participation” (which has been taken up and discussed in a wide variety of news media,...

Still looks to me like the vote will have no material financial consequences? “The UK will have to renegotiate 80,000 pages of EU agreements, deciding those to be kept in UK law and those to jettison. British officials have said privately that nobody knows how long this would take, but some ministers say it would clog up parliament for years.” As previously discussed, the drop in oil prices led to increased consumer imports and reduced exports, both of which fundamentally...

Graph 1. Wage levels and vote shares, Brexit. Brad deLong is very annoyed about this Voxeu piece by a whole slew of famous economists, which advises that we, as a consequence of Brexit, have to double down on the Euro. Full disclosure: the piece is also signed by Brad’s academic Bossom Buddy Barry Eichengreen. I agree with the gist and arguments of the piece of deLong: “From my perspective, this piece at Vox.eu makes many too many bows to conventional-wisdom idols with not just feet but...

Gradual deceleration looks to be continuing:Growth here had been increasing, helping to offset the decline in govt. deficit spending, but after the oil capex collapse this measure of credit growth leveled off:Real estate as well as consumer loan growth have also leveled off:This story is all about income here as well. The consumer has been hit hard twice due to the recession and then tax hikes and it’s all ratcheted down a notch each time. Even in the prior recession personal...

from Dean Baker Voters in the United Kingdom caught almost everyone by surprise with their decision to leave the European Union. The push for Brexit was driven by nationalistic, xenophobic and racist sentiments. There is no point in putting a pretty face on it. But this vote is now a fait accompli. The question is how the leadership of the European Union chooses to respond. In the lead up to the Brexit vote, there was much discussion of punishment. Wolfgang Schauble, the finance minister...

Looks like another small decrease as the deceleration continues: Vehicle Sales Forecasts: Sales to be Over 17 Million SAAR again in June By Bill McBride June 24 (Calculated Risk Blog) — The automakers will report June vehicle sales on Friday, July 1st. Note: There were 26 selling days in June, up from 25 in June 2015.From WardsAuto: Forecast: June Sales to Reach 11-Year High A WardsAuto forecast calls for U.S. automakers to deliver 1.57 million light vehicles this month....

Weaker than expected, and turns out it was up in April followed by down in May as previously discussed: HighlightsMay proved to be a generally weak month for the factory sector. Minus signs spread across the durable goods report with total new orders down a very sizable 2.2 percent and ex-transportation orders, which exclude aircraft and vehicles, down 0.3 percent. The worst news comes from capital goods, a sector where weakness points to weakness in business investment and...

I have been criticised by among others, Professor Simon Wren-Lewis, for the earlier blog criticising the economics profession. To bolster my case, am sharing here ex-governor of the Bank of England, Mervyn King’s, views on the profession. While his is an “on-the-one-hand-but-on-the-other” approach, nevertheless it is clear on the culpability of the profession. The quotation is from page 3 of his recent book, ‘The End of Alchemy‘ published by Little, Brown in 2016. “Since the crisis,...