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November 30, 2009
CBO's Assessment of ARRA's Impact on Q3 Output and Employment
From CBO's just released Estimated Impact of the American Recovery and Reinvestment Act on Employment and Economic Output as of September 2009 :
...Economic output and employment in the spring and summer of 2009 were lower than CBO had projected at the beginning of the year. But in CBO's judgment, that outcome reflects greater-than-projected weakness in the underlying economy rather than lower-than-expected effects of ARRA.
In other words, the continued deterioration of the economy through the first few months after the passage of ARRA was not due to the stimulus package; rather underlying conditions had deteriorated, and the economy would have been in a worse state in the absence of the package. This is similar to the points I made here: [0] [1] [2]
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Posted by Menzie Chinn at 08:54 PM permalink | Comments (17)
November 29, 2009
From VoxEU: The Great Trade Collapse
Causes, Consequences and Prospects, edited by Richard Baldwin
From Baldwin's introductory chapter:
World trade experienced a sudden, severe and synchronised collapse in late 2008 -- the sharpest in recorded history and deepest since WWII. This Ebook -- written for the world's trade ministers gathering for the WTO's Trade Ministerial in Geneva -- presents the economics profession's received wisdom on the collapse....
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Posted by Menzie Chinn at 02:52 PM permalink | Comments (8)
Cash for appliances
From the folks who brought you Cash for Clunkers.
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Posted by James Hamilton at 07:58 AM permalink | Comments (32)
November 26, 2009
Blogonomics: Some Random Thoughts
Back in late October, I was invited to a Bank of Canada workshop (organized by Brigitte Desroches and James Rossiter), entitled "Understanding economic outcomes in uncertain times". I was flattered (and a little surprised) to be asked to participate in a panel discussion on "blogonomics", chaired by David Wolf of the Bank of Canada. On the panel were esteemed fellow bloggers David Altig of Macroblog and Stephen Gordon of Worthwhile Canadian Initiative.
Continue reading "Blogonomics: Some Random Thoughts"
Posted by Menzie Chinn at 08:49 AM permalink | Comments (15)
November 25, 2009
Yes the future deficits are worrisome
Paul Krugman ([1], [2], [3]) has been arguing vigorously that U.S. budget deficits are no cause for concern. I see things differently.
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Posted by James Hamilton at 06:58 AM permalink | Comments (115)
November 23, 2009
Debt and Interest Rates: Some Empirical Evidence and Implications
Today's NYT article suggests apocalypse (very) soon:
...the government faces a payment shock similar to those that sent legions of overstretched homeowners into default on their mortgages.
Do we really need to worry so much in the short term?
Continue reading "Debt and Interest Rates: Some Empirical Evidence and Implications"
Posted by Menzie Chinn at 06:00 PM permalink | Comments (13)
November 22, 2009
Factors in local house price declines
UCSD Ph.D. candidate Sam Dastrup has completed a very interesting study with his advisor Professor Richard Carson of what accounts for differences across U.S. communities in the magnitude of the decline in real estate prices that we've seen over the last several years.
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Posted by James Hamilton at 06:46 AM permalink | Comments (24)
November 21, 2009
Baselines, Counterfactuals and the Stimulus
Apropos the post on evaluating the impact of the stimulus, here is graphical depiction of what IHS Global Insight, Macroeconomic Advisers, and Moody's predicted under the counterfactual of no stimulus against the w/stimulus outlook (from NYT).
Continue reading "Baselines, Counterfactuals and the Stimulus"
Posted by Menzie Chinn at 09:25 AM permalink | Comments (17)
November 19, 2009
China, the Renminbi, and Global Imbalances: A Quantitative View
President Obama's trip to China has returned to scrutiny the role of China's currency and macroeconomic policies in perpetuating global imbalances. [0] [1] [2]
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Posted by Menzie Chinn at 08:45 PM permalink | Comments (31)
GDP: Revisions and Forecasts
There's been some discussion of how the GDP estimates for 2009Q3 might be revised downward in light of the September trade release [1]. e-Forecasting has presented its latest estimates up to October, and Macroeconomic Advisers through September. Macroeconomic Advisers writes:
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Posted by Menzie Chinn at 05:41 PM permalink | Comments (1)
November 18, 2009
Receiver operating characteristics curve
Travis Berge and Oscar Jorda of the University of California, Davis have an interesting new paper on statistical criteria for distinguishing economic expansions from recessions.
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Posted by James Hamilton at 09:36 AM permalink | Comments (13)
November 16, 2009
Assessing the Impact of Government Policy on Widget Consumption and Widget Sector Capital Usage
Let supply and demand for widgets (y) be given by the following two equations, respectively:
(1) yt = αt + β x t + ε t
(2) yt = γ + δ x t + Γ z t + u t
Posted by Menzie Chinn at 02:50 PM permalink | Comments (15)
The Global Surface Temperature Anomaly
From NOAA's National Climate Data Center:
Continue reading "The Global Surface Temperature Anomaly"
Posted by Menzie Chinn at 09:37 AM permalink | Comments (87)
November 15, 2009
Commodity inflation
Why are the prices of so many commodities rising in an economy that seems to remain quite weak?
Continue reading "Commodity inflation"
Posted by James Hamilton at 06:36 AM permalink | Comments (42)
November 11, 2009
Politico Does Economic Analysis...
Be afraid; be very afraid.
From "'Created or saved' doesn't add up", by Joseph Lawler:
...[t]he "created or saved" numbers are meaningless. The administration purposefully devised the metric to be nebulous. Without a counterfactual, showing the trend of unemployment in the absence of the stimulus, it is impossible to know how many jobs the stimulus saved.
Continue reading "Politico Does Economic Analysis..."
Posted by Menzie Chinn at 07:10 PM permalink | Comments (35)
November 10, 2009
Will rising oil prices derail the recovery?
Last April I described new research on the role of oil prices in the recent recession. Here's an update on what's happened since then.
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Posted by James Hamilton at 07:43 PM permalink | Comments (38)
November 09, 2009
"Where's the Consumption Disaster?"
Casey Mulligan asks:
So a year later, in September 2009, after living through a year of "disaster," how did real consumption expenditure (one economists' favorite measures of living standards) compare to what it was in September 2008?
Continue reading ""Where's the Consumption Disaster?""
Posted by Menzie Chinn at 08:18 PM permalink | Comments (23)
Guest Contribution: The Liquidity Trap Does Not Make Monetary Policy Ineffective
By Joseph E. Gagnon
Today, we're fortunate to have Joe Gagnon, senior fellow at the Peterson Institute for International Economics, as a guest contributor.
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Posted by Menzie Chinn at 02:31 PM permalink | Comments (10)
November 07, 2009
Consequences of the Lehman failure
William Sterling of Trilogy Global Advisors has an interesting new paper on the abrupt changes in financial markets subsequent to Lehman's bankruptcy on September 15, 2008.
Continue reading "Consequences of the Lehman failure"
Posted by James Hamilton at 05:46 PM permalink | Comments (23)
November 05, 2009
Some Thoughts Elicited by Reading Some Calibration Papers
(Warning: Might be considered "wonky" by some) In many economic analyses, one wants to isolate the "business cycle" component of macroeconomic series. Here is one such series, which has had a detrending technique applied to it. Try to guess what it is.
Continue reading "Some Thoughts Elicited by Reading Some Calibration Papers"
Posted by Menzie Chinn at 11:28 AM permalink | Comments (10)
November 04, 2009
Current economic conditions
The U.S. recovery is underway. But so far it doesn't look as strong as we had been hoping.
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Posted by James Hamilton at 06:14 AM permalink | Comments (20)
November 02, 2009
Prospects for Employment under Differing Econometric Specifications
Most economists are projecting a slow recovery in terms of employment. What do historical correlations imply?
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Posted by Menzie Chinn at 06:32 PM permalink | Comments (14)