Tag Archives: US EConomics

Industrial production now exceeds pre-pandemic level Industrial production, the King of Coincident Indicators, was reported this morning for August and was positive in a particularly significant way. Total production increased 0.4% in August, and the manufacturing component increased 0.1%. Nothing particularly special about that; in fact the manufacturing component was a little weak compared with most recent months. Additionally, the July...

A more “normal” consumer inflation reading for August belies damage to the economy going forward Inflation, along with the expiration of the emergency pandemic payment, is one of the two big threats to this expansion. This morning August consumer inflation was the lowest in 6 months, up only 0.3% – within the range of a normal reading in normal times. Since wages increased 0.5% in August, this means that real wages increased. Let’s take a...

In my previous post, I argued that the only plausible way to criticize covid policy is to explain why some alternative policy mix (possibly a policy with a big dose of “no regulation”) will lead to better outcomes than the current policy regime.  Libertarians often refuse to engage in this type of policy analysis.  Instead, they often claim that government efforts to fight covid are illegitimate because they are authoritarian, or violate rights, or...

Death to Farm Credit from Those on High, Farmer and Economist, Mike Smith I’m in between fall crop planting and have to focus so I am going to run this like the rancher on the clock. Farm Credit System History  In 1916 when the Farm Credit System was established there were 6 million farms that employed around 30% of the US population. They each averaged 140 acres or so of land, had minimal automation investment, were manually laborious, and...

Libertarians criticize covid policy in broad, uncompromising terms.  These arguments are unproductive at best; at worst they are divisive and potentially destructive.  Many are just propaganda. This does not mean that criticism of the government response to covid is off limits.  The alternative to the libertarian approach is policy analysis:  evaluating specific policies on their own merits by marshalling evidence and estimating their likely...

August Producer Price Index Sets New YoY Record Increases for Final Demand Goods, Final Demand Services, and a 46 year High for Prices of Intermediate Goods; MarketWatch 666, Commenter RJS Producer Price Index by Commodity: Final Demand: Final Demand Goods (PPIFDG) | FRED | St. Louis Fed (stlouisfed.org)The seasonally adjusted Producer Price Index (PPI) for final demand rose 0.7% in August, as prices for finished wholesale goods rose 1.0% while...

Beware of “The Narrative”! Back in 1979 philosopher Jean-François Lyotard was commissioned to do a report for the province of Quebec that turned into a book, The Postmodern Condition. I remember that book well because I read it during my graduate studies that focused on narrative analysis. A central theme of Lyotard’s book was the “death of metanarratives,” such as the Idea of Progress or Marx’s Class Struggle as the engine of history. Fast...

July JOLTS report shows market still out of equilibrium, no additional hiring from early termination of benefits This morning’s JOLTS report for July is particularly important, because July was the first full month after a number of GOP-controlled States terminated enhanced unemployment benefits, on the theory that they were excessive and were coddling idle workers. Thus we should be seeing a big drop in unfilled job openings, as those people...

Jobless claims blow away the Delta wave (but beware Labor Day seasonality) This morning’s initial jobless claims report makes it shockingly evident that the Delta wave has had no appreciable effect on at least the “firing” side of the jobs market (vs. the “hiring” side, where it might have). Initial claims declined 35,000 to 310,000, and the 4-week average also declined 16,750 to 339,500, both yet more pandemic lows: By way of...

The unemployment rate is not *uniquely* overestimating the “true” employment situation Bill McBride a/k/a Calculated Risk put up an entry over the weekend positing that the employment situation is worse than the unemployment rate indicates. He bases this on the expectation that the overall labor force was expected to grow by 100,000 a month in 2020 and this year, whereas as of last month there were a little more than 2.9 million less people...