– by New Deal democrat The Bonddad Blog Personal income and spending has become one of the two most important monthly reports I follow, because it nets out the impacts of higher interest rates and abating inflation due to the unlinking of the supply chain. To repeat, the big question this year is whether the contractionary effects of Fed tightening have just been delayed until this year. Or whether the fact that there have been no rate hikes...
Read More »Open Thread March 29 2024 CA Fast Food Workers get a boost in hourly wage
Starting April 1, fast-food workers in California will be paid at least $20 an hour, thanks to legislation passed last fall that raised the industry-wide minimum wage. Why? “the difference between the prices consumers pay and the cost of production—have increased sharply over the past decade of growth for the industry.” Roosevelt Institute Open Thread March 24 2024 Shorter Work Week – Is It All It Promises to Be? – Angry Bear...
Read More »Initial claims remain somnolent, while continuing claims pop slightly
– by New Deal democrat The divergence in the trends between initial and continuing claims continued this week, as the former continued their somnolent good news, while the latter had a slightly disconcerting pop. Initial claims declined -2,000 to 210,000, and the four week average declined -750 to 211,000. On the other hand, with the usual one week delay, continuing claims rose 24,000 to 1.819 million: The first two are in the same range...
Read More »You can’t fool Mother Nature
Back when we lived in Chapel Hill NC, we made a few trips to the Outer Banks where my wife had an uncle who built fishing boats in Buxton NC. Back then, nobody was talking about sea levels rising because of global warming and yet it was obvious back then (early 1980s) that these sandy beaches were ephemeral and the buildings that overlooked them were at risk. The iconic Hatteras Lighthouse had to be moved away from the encroaching ocean back in...
Read More »Correcting 11 Washington Post’s Charts That Are Supposed to Tell How the Economy Changed Since Covid
by Dean Baker CEPR Not much of a surprise here the 11 Washington Post’s Charts need some explaining to correct the misinterpretation of them by WaPo. The issue here is the amount of bad or false information floating around in the news media today. People tend to believe what they initially read and go no further. When people like Prof. Dean come along and correct the inaccuracies it can be misinterpreted as political. People want to believe...
Read More »A detailed look at manufacturing, and an update on freight
– by New Deal democrat As I wrote on Monday, the big question for this year is whether the recessionary effects of the Fed rate hikes have just been delayed. Or whether, because the rate hikes have stopped, so has the headwind they normally produce. Watching manufacturing and construction, especially housing construction, is what I expect to supply the answer. On Monday I focused on housing construction and sales. Since there’s no big economic...
Read More »Is this true?
Whenever Elon Musk says a thing, I reflexively mistrust it. So when I saw a video clip of Musk making this assertion, I wanted to think I learned something about the auto industry, but then I considered the source:“Large incumbent carmakers sell their cars at low to zero true margin. Most of their profit is selling replacement parts to their fleet, of which 70% to 80% are past warranty. Like razors & blades.”What say you, Bears? Is he correct?...
Read More »Repeat home sales price declined slightly in January; expect deceleration in the CPI measures of shelter to continue
– by New Deal democrat As I noted again yesterday, house prices lag home sales, which in turn lag mortgage rates. Yesterday we got the final February reading on sales. This morning we got the final January read on prices, for repeat sales of existing homes. Last week’s report on existing home sales showed a sharp increase in February, a repeat of the seasonally adjusted sharp increase last February, which was almost completely taken back over...
Read More »As mortgage rates remain rangebound, so do new home sales
– by New Deal democrat Let’s begin this post by putting why I am watching new home sales in context. The economy was kept out of recession last year, despite aggressive Fed rate hikes, in large part by commodity price deflation, much or most of which was triggered by the un-kinking of supply chains after the pandemic. That gale force economic tailwind is gone, but the Fed rate hikes remain. So, the big question for this year is whether the...
Read More »The economy is actually doing great — unless you want to make a change in your life.
Liking your present situation right now? Your job, your house, your car, you can keep it and you may have to do so. Buying a new car, house, or getting a different job may be more costly and not pay off. Even if you are not so satisfied, chances maybe you having to manage your pennies and stay put. Making a major economic change today involving costly upgrades, may not be advantageous, right now. Getting far out on a limb in a new job or with...
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