Tag Archives: US/Global Economics

Q1 corporate profits and real gross domestic income Yesterday the second estimate of Q1 GDP came out, which means that corporate profits for Q1 were finally reported. In my post earlier this week at Seeking Alpha, I wrote that corporate profits are of higher forecasting importance because of the contradiction in the signals being sent by the bond market vs. the housing market. So what light do they shed on the forecast for the next 12 months? I wrote a...

Trump’s Latest Mexican Tariff Tirade Irks Senator Grassley Senator Grassley rebukes the latest idiocy from the White House: President Trump dropped a trade war bomb on Thursday when he announced his intent to put in place new and harsh tariffs on goods from Mexico until the “illegal Immigration problem is remedied.” And among the many worried, negative reactions was one from Senate Finance Committee Chair Chuck Grassley, in a strongly worded statement....

Does anyone know why coal production is falling out of bed?  It is down some 40% from its August level. But coal employment is still near its’ recent peak, which implies that productivity is horrible. I suspect the problem is exports to China. Maybe someone needs to ask Trump about this.

A Decision Theory Case to Chew On Here’s something I posted over on Andrew Gelman’s wonderful blog: I read Alive and thought it unknowingly made a very powerful point about decision theory, that you always have to balance the risks of action against the risks of inaction. The plane was stuck in snow on a slope that led down to a valley that was partially inhabited. Yes, the immediate survivors could not see this, and sending a party down the slope seemed...

by New Deal democrat Resolving the contradiction between the yield curve and housing If you listen to the yield curve, it is screaming “recession!”  If you listen to new home sales, they are saying “no worries!”  One of them is wrong. For the last couple of weeks, I have been going back over history in an effort to resolve the contradictory signals. One important portion of that work has been to focus on the non-financial leading indicators, and in...

Will China Play The Rare Earth Card In The Trade War? The rumor that China might play its “rare earth card” was the rumor today that helped push down both stock and oil markets according to a variety of reports.  The trigger for this seems to have been a visit on May 26 by China’s president, Xi  Jinping, to a rare earth facility, along with some rumbling statements associated with that visit.  They may not do it, but the possibility of blocking exports...

Trucking tops ailing rail (nerdy) Since the beginning of this year, weekly rail volumes have usually been negative.  The full year to date volumes have also been negative YoY: Since all manufactured goods have to be transported to market, if this is something confirmed in other transportation readings, it would clearly be recessionary – as in, a recession has already started. One alternative measure of the transportation sector is the Cass Freight...

Conservative Economists Discover the Baumol Cost Disease A little over a year ago Mark Perry wrote this nonsense: The chart above (thanks to Olivier Ballou) is an update of a chart we produced last year about this time, and shows the percent changes since January 1997 in the prices of selected consumer goods and services, along with the increase in average hourly earnings in this version … Blue lines = prices subject to free market forces. Red lines =...

Khamenei Denounces Rouhani For Negotiating Nuclear Deal This has been reported by Juan Cole.  Apparently Supreme Jurisprudent, Ali Khamenei of Iran in a speech to a large number of university students has seriously denounced President Rouhani for having negotiated the JCPOA nuclear agreement with the United States and other powers.  During the negotiations Khamenei played a mixed role, raising doubts about the negotiations, but allowing them to continue...

Read Brad’s post. my comment on “Milton Friedman’s redefinition of “neutral monetary policy” to mean “whatever monetary policy keeps nominal GDP on its trend growth path” led people prone to motivated reasoning in a laissez-faire direction completely and horribly astray… astonishing failure to mark one’s beliefs to market” Someone should write a book “Economic Theory: What Went Wrong”. You had a draft in your mind some years ago. PseudoDeLong wrote...