March 18, 2010
What the heck is a "Punk Staffer"?
And how does a "punk staffer" differ from a non-punk staffer?
Posted by Menzie Chinn at 04:10 PM permalink | Comments (10) | digg this | reddit
CBO Scoring of HR3590 plus Reconciliation Legislation
The CBO and the Congressional Joint Committee on Taxation have just released its scoring of "budgetary effects of the reconciliation proposal, in combination with the effects of H.R. 3590, the Patient Protection and Affordable Care Act (PPACA), as passed by the Senate". The link to the document is here. The CBO/JCT estimated reduction in the deficit over FY2010-2019 is $119 billion. A comparison of the impact on the budget balance against previous reconciliation measures is presented in Figure 1, below.
Continue reading "CBO Scoring of HR3590 plus Reconciliation Legislation"
Posted by Menzie Chinn at 10:30 AM permalink | Comments (5) | digg this | reddit
Obama after One Year: Crisis, Response, Recovery
A couple days ago, I presented my views on the policy response to the financial crisis and the Great Recession in a UW Center for World Affairs and the Global Economy / UW CIBER / MITA and ICE sponsored event. The power point slides are here (big file, 1.3MB). I took the latitude as the invited speaker to expand the topic from the Obama Administration's measures to encompass the response to the crisis and recession from both the fiscal and monetary policy authorities.
Continue reading "Obama after One Year: Crisis, Response, Recovery"
Posted by Menzie Chinn at 06:15 AM permalink | Comments (6) | digg this | reddit
March 17, 2010
Bank supervision and the Federal Reserve
In testimony today before Congress, Fed Chair Ben Bernanke outlined his reasons why the Federal Reserve is uniquely suited to be the regulatory supervisor for U.S. banks.
Continue reading "Bank supervision and the Federal Reserve"
Posted by James Hamilton at 10:33 AM permalink | Comments (27) | digg this | reddit
March 15, 2010
What Do Business Economists Think the ARRA Accomplished?
Or, counterfactuals, yet again.
Or, rejoinder to Casey Mulligan, Joseph Lawler, david, tim kemper and others.
From the WSJ March survey survey of forecasters, the results indicate that instead of the 0.15% growth rate recorded in 09Q4 y/y growth, the growth rate would have been -0.93%. For 2010Q4 Q4/Q4 growth, they forecast 3% growth, and in the absence of the ARRA, they would have predicted 2.2% growth.
Continue reading "What Do Business Economists Think the ARRA Accomplished?"
Posted by Menzie Chinn at 09:08 PM permalink | Comments (22) | digg this | reddit
2010 Econbrowser NCAA tournament challenge
If you're both a very faithful and a very passive Econbrowser reader, for two years now you've sat on the sidelines while you watched other, equally faithful but less passive readers participate in the world-famous Econbrowser NCAA Tournament Challenge, in which brave souls pretend they can predict a significant number of the winners of the games of the NCAA men's basketball tournament. If so, here's your third chance to sit on the sidelines again, or maybe even to participate this time.
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Posted by James Hamilton at 03:52 PM permalink | Comments (4) | digg this | reddit
March 14, 2010
The challenges ahead for world oil
University of Leeds Professor Joyce Dargay and New York University Professor Dermot Gately have a new research paper suggesting that projections from the DOE, IEA, and OPEC are underestimating the challenges ahead for meeting world oil demand.
Continue reading "The challenges ahead for world oil"
Posted by James Hamilton at 06:35 AM permalink | Comments (37) | digg this | reddit
March 12, 2010
Update: the 2010-19 Impact of PPACA on Budget Balance
And a quantitative comparison to previous reconciliation measures.
The CBO and the Congressional Joint Committee on Taxation (JCT) have updated cost estimates for H.R. 3590, the Patient Protection and Affordable Care Act (PPACA), as it was passed by the Senate on December 24, 2009. The figures are here. I've incorporated the new estimates into the bar chart first reported in this March 1st post.
Continue reading "Update: the 2010-19 Impact of PPACA on Budget Balance"
Posted by Menzie Chinn at 11:05 AM permalink | Comments (8) | digg this | reddit
March 11, 2010
Durable Goods and the Collapse of Global Trade
From a Dallas Fed Letter by Jian Wang:
Durable goods represent a moderate share of the economy in most industrial countries -- in the U.S., for example, they accounted for 23.6 percent of real GDP in 2008. However, durable goods make up a large share of international trade. In the U.S., they accounted for more than 60 percent of trade in goods (excluding energy products) in 2008. The figure is 70 percent on average for the OECD countries, according to several studies.
Continue reading "Durable Goods and the Collapse of Global Trade"
Posted by Menzie Chinn at 12:50 PM permalink | Comments (2) | digg this | reddit
Whither the Yuan?
Political pressure seems to be mounting for yuan appreciation. [0] Figure 1 depicts the stability in the USD/CNY nominal exchange rate over the past year.
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Posted by Menzie Chinn at 11:10 AM permalink | Comments (21) | digg this | reddit
March 09, 2010
Modeling problems in credit markets
On Friday I joined fellow blogger Mark Thoma (and a good many other economists) at a very interesting conference on financial markets held at the Federal Reserve Bank of San Francisco. Here I share some ideas I expressed at the conference about the directions I feel this research ought to go.
Continue reading "Modeling problems in credit markets"
Posted by James Hamilton at 09:23 PM permalink | Comments (26) | digg this | reddit
Aspirin
Russ Roberts writes:
Menzie Chinn invokes the CBO "estimates" to argue against those who say the stimulus didn't work. Did the stimulus help turn the economy around and create jobs? I'm skeptical on logical grounds but I confess that I do not have strong empirical evidence on my side.
But those who defend the stimulus have no empirical support either...
Posted by Menzie Chinn at 09:41 AM permalink | Comments (40) | digg this | reddit
March 08, 2010
Speaking of Unfunded Liabilities: Medicare Part D
The Financial Report of the United States Government, 2009 was released last week. Perusing the tables, one encounters the gigantic new, unfunded entitlement enacted in 2003, namely Medicare Part D.
Continue reading "Speaking of Unfunded Liabilities: Medicare Part D"
Posted by Menzie Chinn at 08:34 PM permalink | Comments (15) | digg this | reddit
March 07, 2010
A new index of financial conditions
What do current financial indicators tell us about where the economy is headed?
Continue reading "A new index of financial conditions"
Posted by James Hamilton at 07:10 AM permalink | Comments (32) | digg this | reddit
March 04, 2010
The Global Financial Crisis: Explaining Cross-Country Differences in the Output Impact
From "The Global Financial Crisis: Explaining Cross-Country Differences in the Output Impact," IMF WP 09/280, by Pelin Berkmen, Gaston Gelos, Robert Rennhack, and James P. Walsh:
We provide one of the first attempts at explaining the differences in the crisis impact across developing countries and emerging markets. Using cross-country regressions to explain the factors driving growth forecast revisions after the eruption of the global crisis, we find that a small set of variables explain a large share of the variation in growth revisions. ...
Posted by Menzie Chinn at 11:15 AM permalink | Comments (9) | digg this | reddit
March 03, 2010
Who Are You Going to Believe?
Professor Casey Mulligan says (and yesterday unequivocally reiterates) the stimulus program would not stimulate the economy. The nonpartisan CBO says otherwise:
...CBO estimates that in the fourth quarter of calendar year 2009, ARRA's policies:
- Raised real GDP by between 1.5 percent and 3.5 percent,
- Lowered the unemployment rate by between 0.5 percentage points and 1.1 percentage points,
- Increased the number of people employed by between 1.0 million and 2.1 million, and
- Increased the number of full-time-equivalent jobs by 1.4 million to 3.0 million compared with what those amounts would have been otherwise (see Table 1).
Continue reading "Who Are You Going to Believe?"
Posted by Menzie Chinn at 08:44 PM permalink | Comments (29) | digg this | reddit
March 02, 2010
Crawling forward
Another month of weakly improving auto sales.
Continue reading "Crawling forward"
Posted by James Hamilton at 06:39 PM permalink | Comments (9) | digg this | reddit
Net Fiscal Stimulus
From the abstract to "On the ease of overstating the fiscal stimulus in the US, 2008-9", by (my sometime coauthor) Joshua Aizenman and Gurnain Kaur Pasricha:
This note shows that the aggregate fiscal expenditure stimulus in the United States, properly adjusted for the declining fiscal expenditure of the fifty states, was close to zero in 2009. While the Federal government stimulus prevented a net decline in aggregate fiscal expenditure, it did not stimulate the aggregate expenditure above its predicted mean. ...
Continue reading "Net Fiscal Stimulus"
Posted by Menzie Chinn at 09:45 AM permalink | Comments (13) | digg this | reddit
March 01, 2010
What Are These Three Numbers?
These numbers are expressed in billions of FY2010 dollars.
Figure 1, in billions of FY2010 dollars.
Continue reading "What Are These Three Numbers?"
Posted by Menzie Chinn at 06:40 PM permalink | Comments (26) | digg this | reddit
February 28, 2010
What drives media slant?
University of Chicago professors Matthew Gentzkow and Jesse Shapiro propose an answer.
Continue reading "What drives media slant?"
Posted by James Hamilton at 07:03 AM permalink | Comments (32) | digg this | reddit
February 25, 2010
Exports: Productivity, Factor Proportions, and Policy Implications
Bringing New Research Developments to Bear
The President's goal of doubling exports elicited a lot of discussion, and skepticism. In a previous blog post, I examined the prospects of accomplishing this goal from a macroeconomic perspective. However, a few discussions I've had with journalists have reminded me that the frontier of international trade theory has moved considerably over the past few years, even as the much of the economic commentary remains mired in the older models. In this respect, the most recent edition of the Economic Report of the President was extremely welcome, as it brought to bear recent innovations in the trade literature.
Continue reading "Exports: Productivity, Factor Proportions, and Policy Implications"
Posted by Menzie Chinn at 01:40 PM permalink | Comments (20) | digg this | reddit
February 23, 2010
Treasury Supplementary Financing Program (SFP)
The SFP, the U.S. Treasury's program for assisting with the balance sheet of the Federal Reserve, is making a sudden and dramatic comeback.
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Posted by James Hamilton at 08:53 PM permalink | Comments (21) | digg this | reddit
Real Wage Decline Ended the 1981-82 Recession?
David Henderson writes in his "Reply to DeLong":
In the 1981-82 recession, the fall in real wages helped end the recession.
I don't see it in BLS series Nonfarm Business Sector: Real Compensation Per Hour.
Continue reading "Real Wage Decline Ended the 1981-82 Recession?"
Posted by Menzie Chinn at 04:28 PM permalink | Comments (21) | digg this | reddit
February 22, 2010
In Search of...Crowding Out
There are various definitions of crowding out. There's crowding out in the financial markets, and crowding out of actual economic activity. In order for crowding out in the financial markets to translate into a reduction of the interest sensitive components of aggregate demand, one needs to see an impact on interest rates. So, what is happening to real (inflation adjusted) interest rates?
Continue reading "In Search of...Crowding Out"
Posted by Menzie Chinn at 06:20 PM permalink | Comments (20) | digg this | reddit
The Demand for Stimulus Funds
From Bloomberg today:
...more than 100 congressional Republicans and several Democrats who, after voting against the stimulus bill, wrote Transportation Secretary Ray LaHood seeking money from $1.5 billion the plan set aside for local road, bridge, rail and transit grants. The $862 billion American Recovery and Reinvestment Act passed last year with no Republican votes in the House and three in the Senate.
Continue reading "The Demand for Stimulus Funds"
Posted by Menzie Chinn at 11:52 AM permalink | Comments (11) | digg this | reddit
February 20, 2010
The Fed's discount rate hike
The Federal Reserve Board announced on Thursday that it is raising the interest rate at which banks borrow from the Fed's discount window to 0.75%, a 25-basis-point increase, and intends to return discount lending primarily to the traditional overnight loans. "The rate hike cycle begins," declared 24/7 Wall St, and Business Week reported:
Treasuries fell, pushing yields to the highest levels in at least five weeks, amid concern the Federal Reserve's increase in the discount rate signaled policy makers are moving closer to lifting benchmark borrowing costs.
But I don't believe that's what the discount rate hike means at all.
Continue reading "The Fed's discount rate hike"
Posted by James Hamilton at 01:39 PM permalink | Comments (33) | digg this | reddit
February 19, 2010
Macroeconomic Advisers: On the Stimulus Package
From today's Macroeconomic Advisers blogpost, by Joel Prakken:
Frequently, partisan commentators -- and even some economists -- exclaim that the stimulus has failed because the unemployment rate now exceeds the peak shown in projections prepared before ARRA was implemented. This argument, which clearly -- and perhaps intentionally -- confuses the pre-stimulus baseline with the incremental effects of the stimulus, would be laughable if it was not taken so seriously in some quarters. For the record, last spring, as the financial crisis that engulfed the economy worsened unexpectedly -- but before the stimulus could possibly have had any real effect on the economy -- the unemployment rate already had moved above the Administration's (and many others') last pre-stimulus projection. So, this is simple: the baseline forecasts were optimistic, but unemployment would be even higher now without the benefit of the stimulus package.
Continue reading "Macroeconomic Advisers: On the Stimulus Package"
Posted by Menzie Chinn at 12:02 PM permalink | Comments (30) | digg this | reddit
February 17, 2010
Assessing the Stimulus, One Year In: A View from the Mainstream
On the one year anniversary of the passage of the ARRA, it seems appropriate to recap, not what the academics say, but what the business sector forecasters say about the impact of the stimulus package.
Continue reading "Assessing the Stimulus, One Year In: A View from the Mainstream"
Posted by Menzie Chinn at 08:04 PM permalink | Comments (46) | digg this | reddit
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