October 31, 2006
Accuracy of futures prices as predictors of the fed funds rate
I'm just finishing writing a new research paper whose goal is to come up with a better measure and understanding of the lagged effect of monetary policy on the economy. One of my claims is that the public's expectations of what the Fed is going to do next play a key role in that process. In this, the first of several posts based on that paper, I describe some of the properties I've found for fed funds futures prices as predictors of subsequent Fed policy changes.
"Trends in Iraq" - Updated
This figure updates the data presented in an earlier post on Iraq trends, replacing the projection with actual figures for October.
October 30, 2006
Skepticism about the Business Fixed Investment Handoff
One view of how GDP growth can be sustained in the wake of negative residential investment growth is to assert that business fixed investment picks up the slack. If this happens, then the adjustment of construction employment need not be too abrupt.
October 27, 2006
Interpreting median house prices
"Home Prices Plunge by Most in 35 Years", declare the headlines. But those numbers don't mean what you might think.
Third quarter growth slows to a crawl
As expected, GDP growth became even weaker in 2006:Q3.
October 26, 2006
More evidence that housing may be stabilizing
Data on new home sales and inventories released today from the Census Bureau continue to support the view that the market downturn may have reached its bottom.
The U.S. Macroeconomy: Facing the Future with (at least) One Hand Tied
[This is an English version of an article that appeared the Italian newspaper Il Sole 24 Ore on the 24th September.]
Today, the U.S. economy stands poised between persistent inflation and slowdown. Even as many measures in the production side of the economy signal continued strength in the economy, forward looking indicators such as housing prices, residential investment, and the yield curve point to substantially weaker growth going forward.
October 24, 2006
Is peak oil irrelevant?
Does the market price of oil reflect a recognition that the resource is fundamentally limited?
The Fiscal Exposure of the Nation
In present value terms, where were we in 2000? Where are we now?
October 22, 2006
Monday, December 18, 2006
At the rate of casualties incurred in October-to-date, cumulative U.S. fatalities in the Iraqi theater of operations will exceed 3000 on this date.
October 20, 2006
Map showing projected outcomes of U.S. senate elections
Via Midas Oracle, a neat map from Computational Complexity showing the current Tradesports probabilities for U.S. Senate outcomes. Like the graphics I collected here, this is continually updated live.
October 19, 2006
One way or the other
Mixed signals this week leave Bernanke still needing to earn his pay.
October 18, 2006
Tales from the CBO (and the White House)
Investigating the numbers
Proposition 87 expenditures
Last week I discussed the way in which California's Proposition 87, the Clean Alternative Energy Act, would raise revenues. Today I take a look at some of the implications of its proposed use of those funds.
October 16, 2006
How Strong Is (Was) the Dollar?
An alternative view on the dollar's strength and trend over time.
October 13, 2006
Friday the thirteenth not so scary
The latest data on retail sales, tax receipts, and consumer sentiment all look consistent with the soft landing scenario.
October 12, 2006
Trends in Iraq
Casualties, force levels and expenditures
October 10, 2006
Proposition 87 tax plan
Sixteen of the 191 pages that Californians are asked to read in order to vote intelligently in the upcoming election are devoted to discussion of Proposition 87, the Clean Alternative Energy Act. This calls for $4 billion or more in new taxes and spending. In this post, I discuss only the tax side of this proposal, and hopefully will have an opportunity to take up the spending details in a sequel.
October 09, 2006
Perspective on the Employment Release and Preliminary Benchmark Revision
There was a lot of discussion surrounding the BLS's benchmark revision. Dave Altig at Macroblog has an excellent review, while Ritholz at Big Picture is perturbed about the magnitude of the data revision. Without claiming to have greater insights into why the revision is so large, I do think a look at the context would be useful.
October 07, 2006
Following the U.S. elections
If you're looking for an alternative to the talking heads and endless spinning, here are some quantitative tools for following the U.S. elections that I've found useful.
October 06, 2006
So now the Saudis did it
Some people remain intent on believing that falling oil prices are the result of a conspiracy to keep Republicans in power. No sooner had I addressed the theory that Goldman Sachs had somehow initiated the huge price swings currently underway than a new theory pops up to replace it.
October 04, 2006
Twin deficits redux
On the current account deficit, "We have met the enemy, and he is us".
October 03, 2006
And they all lived happily ever after
Can high-flying stocks be reconciled with an inverted yield curve? David Rosenberg of Merrill Lynch, via Felix Salmon and Business Week thinks "it is highly doubtful that both asset classes can be getting the story right." But here's one scenario under which both markets in fact might be telling the same story.
October 02, 2006
It's not such a small world after all (and it's getting bigger)
Taking a break from recession talk, I discuss some aspects of the progress of economic integration highlighted in a paper by Bergin and Glick presented at a SCCIE-JIMF conference on Financial and Commercial Integrations.
Pending home sales up
The National Association of Realtors released favorable news today on pending home sales.
October 01, 2006
The great gasoline price conspiracy
Have you heard the latest explanation for how President Bush contrived to lower gasoline prices in time for the election?