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May 31, 2008
GDP on the Eve of Recession: Then and (Maybe) Now
There's been relief in many circles that GDP in 2008Q1 was revised upward. I too take this as good news, to the extent that the economy seems to be growing more rapidly -- and output more balanced -- than previously thought. Figure 1 depicts the q/q SAAR growth rate, using the May 2008 preliminary release.
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Posted by Menzie Chinn at 07:50 AM permalink | Comments (9)
What the Administration Considered Too Dangerous to Release for Four Years
And released only under threat of a court order: "Scientific Assessment of the Effects of Global Change on the United States" (summary).
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Posted by Menzie Chinn at 12:01 AM permalink | Comments (38)
May 30, 2008
Commodity futures speculation
More on the possible contribution of index fund investment to recent commodity price moves.
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Posted by James Hamilton at 05:59 AM permalink | Comments (6)
May 29, 2008
The End of a Trend? The Export and Import Price Release in Context
The BLS's Import/Export price release, from May 13th, might seem like old news. And some aspects are. But I think it is useful to think about what the trends in these price indices mean for general inflation and the adjustment process (this is in some sense an update on this post).
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Posted by Menzie Chinn at 12:15 AM permalink | Comments (11)
May 27, 2008
House prices and inventory
More outstanding analysis from Calculated Risk.
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Posted by James Hamilton at 07:24 AM permalink | Comments (11)
May 25, 2008
How Effective Will Monetary Easing Be? The Bank Lending Channel and the Implications of Increasingly Internationalized Banks
As I noted in a previous post, monetary policy works through various channels, one of which is the "bank lending channel". Lower policy rates, as witnessed in the past few months and shown below, should induce greater lending.
Posted by Menzie Chinn at 10:00 AM permalink | Comments (5)
May 24, 2008
Understanding crude oil prices
That's the title of my latest research paper. Here's the summary from the paper's introduction.
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Posted by James Hamilton at 12:51 PM permalink | Comments (40)
May 22, 2008
Oil speculation
Several readers call our attention to testimony by Michael Masters, of Masters Capital Management, before the Senate Committee on Homeland Security and Governmental Affairs, on the role that speculation has played in recent commodity price movements. Here is what I think Masters is missing.
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Posted by James Hamilton at 07:44 PM permalink | Comments (55)
RMB Misalignment in a PPP Framework: The Impact of Data Revisions
The World Bank's new World Development Indicators were released a bit over a month ago. The impact on the estimates of RMB misalignment are substantial. (This is an elaboration on a RGEMonitor post by Yin-Wong Cheung from a week and half ago, and is based on preliminary results from a presentation made yesterday at a Deutsche Bundesbank and Center for Financial Studies/Goethe University Frankfurt Workshop on Panel Methods and Open Economies".)
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Posted by Menzie Chinn at 04:26 AM permalink | Comments (1)
May 20, 2008
Oil price fundamentals
I've been offering reasons for believing that the flow of funds into commodity investing has contributed to the recent oil price highs. Although I believe this speculation has gotten ahead of fundamentals in the last few months, there is no question in my mind that market fundamentals are the main reason for the broader 5-year move up in oil prices. Here I review those fundamental factors.
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Posted by James Hamilton at 08:27 PM permalink | Comments (46)
May 19, 2008
Reconciling Estimates: Biofuels and Food Prices
The AP describes Lazear's views on the role of biofuels on rising prices thus: "US disputes IMF on food prices".
From the article by Desmond Butler:
WASHINGTON (AP) — The Bush administration is disputing the International Monetary Fund's claim that increased production of biofuels is the biggest factor in rising food prices.
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Posted by Menzie Chinn at 08:41 PM permalink | Comments (8)
Charles Engel on the oil bubble
Charles Engel, Menzie's colleague at the University of Wisconsin and my long-time personal friend, enters the world of blogging with some thoughts on whether we're seeing a bubble in oil prices.
Posted by James Hamilton at 10:37 AM permalink | Comments (18)
May 17, 2008
Oil bubble
How speculation may be contributing to the most recent moves in oil prices.
Posted by James Hamilton at 12:00 PM permalink | Comments (71)
May 15, 2008
Making fuel out of air and sunshine
Plants do it. Why not you?
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Posted by James Hamilton at 08:18 PM permalink | Comments (49)
High Frequency GDP Estimates
From Macroeconomic Advisers, May 14:
Monthly GDP Index: March 2008
Monthly GDP rose 0.3% in March. This followed a 1.0% decline in February that was revised up from a 1.2% decline in last month's report. The moderate increase in monthly GDP in March can largely be accounted for by positive contributions from personal consumption expenditures and domestic spending on capital goods. A large positive contribution from net exports was essentially offset by a large negative contribution from inventory investment. The level of monthly GDP in March was 0.5% below the first-quarter average at an annual rate. Our latest tracking forecast of 2.6% growth of GDP in Q2 assumes average monthly increases of 0.4% per month from April to June.
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Posted by Menzie Chinn at 11:47 AM permalink | Comments (6)
May 14, 2008
Musing on Seasonal Adjustment and the CPI
The latest CPI release provided some much needed relief on the inflation front. What caught my eye was some of the discussion regarding the seasonal adjustment. This inspired me to wonder what seasonal adjustment was doing.
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Posted by Menzie Chinn at 10:10 PM permalink | Comments (8)
May 13, 2008
Baby you can fly my car
Via West Virginia Rebel, the Telegraph reports:
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Posted by James Hamilton at 08:55 PM permalink | Comments (8)
Credit crunch: how we got here and how to get out
Fed Chair Ben Bernanke on Tuesday offered his perspective on the appropriate response of the Fed to the ongoing turmoil in financial markets. I still think he's overlooking a key element of what's been happening.
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Posted by James Hamilton at 08:16 PM permalink | Comments (19)
May 12, 2008
Net Exports, Oil Imports, and Implications for GDP
The March trade release was taken as good news. Here's some reasons to wonder a bit more about how good the news was.
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Posted by Menzie Chinn at 08:20 PM permalink | Comments (13)
May 09, 2008
What if we'd been on the gold standard?
If the U.S. had decided to go back on the gold standard in 2006, where would we be today? That's a question my friend Randy Parker recently asked me. Here's how we both would answer.
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Posted by James Hamilton at 05:59 AM permalink | Comments (71)
May 07, 2008
Lazear Sees No Recession for U.S. Economy
From WSJ, Henry Pulizzi and John D. McKinnon write:
Continue reading "Lazear Sees No Recession for U.S. Economy"
Posted by Menzie Chinn at 09:45 PM permalink | Comments (9)
May 06, 2008
Current Account Balances, Again
Two years ago, as part of a multi-year project, Charles Engel and I organized a conference on current account sustainability in major advanced economies. Lask week, we convened a follow-up conference aimed at updating our knowledge on this subject. Below is the latest read on the U.S. current account to GDP.
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Posted by Menzie Chinn at 08:00 PM permalink | Comments (16)
May 05, 2008
Gasoline prices: consumers and politicians respond
The trend is clear: demand is down and complaints are up.
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Posted by James Hamilton at 08:41 PM permalink | Comments (32)
May 04, 2008
Updated Chinn-Ito Financial Openness Index Online
The newest version of the Chinn-Ito financial openness index (earlier discussed here), extending up to 2006, has just been posted. Here's the series for Argentina and for Venezuela.
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Posted by Menzie Chinn at 09:22 PM permalink | Comments (3)
May 03, 2008
A Memo I'd Love to See: Whales and Economics
From the Washington Post:
White House officials for more than a year have blocked a rule aimed at protecting endangered North Atlantic right whales by challenging the findings of government scientists, according to documents obtained by the Union of Concerned Scientists.
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Posted by Menzie Chinn at 06:20 PM permalink | Comments (36)
Macroeconomics and ARCH
That's the topic of my most recent research paper. Reader warning: this is a bit more technical than the standard Econbrowser post, so if you're not a user of regression analysis, this may not be up your alley.
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Posted by James Hamilton at 05:37 AM permalink | Comments (11)
May 02, 2008
Fast and Easy Fannie
The Wall Street Journal had a very disturbing story on Wednesday about the "Fast and Easy" loan program of Countrywide Financial Corporation, many of whose mortgages were bought up by Fannie Mae.
Continue reading "Fast and Easy Fannie"
Posted by James Hamilton at 06:20 AM permalink | Comments (22)