No. Figure 1: Forecasted probability of recession from 10yr-3mo term spread (blue), from 10yr-2yr term spread (tan), 10yr-3mo term spread augmented by FCI, foreign term spread (green). All models estimated over 1986M01-2022M11. NBER defined peak-to-trough recession dates shaded gray. Lilac shading…
Yesterday’s Bloomberg article “Fed Staff Sees a 50-50 Chance of Recession” spurred me to examine the implications of the latest readings on term spreads. Figure 1 depicts the recession probabilities estimated using a simple probit model based on the 10yr-3mo and…
A long running debate between reader JohnH and just about anybody else on this website involves UK 2015 (1) inflation, and (2) real wages, with JohnH quoting from various documents. I thought it useful to GET THE DATA MYSELF to resolve…
Regarding the view the US economy was in recession earlier this year (e.g., this observer less than a month ago), the CFNAI has the following takes: The three month moving average of the CFNAI dropped below 0 (i.e., dropped below trend…
The current GDP deflator should be 18% higher (in log terms), or 154.2 instead of 128.2. To see this, consider the tautology: MV ≡ PQ Where M is money, V is velocity, P is price level, Q is economic activity. Assume V’ is constant; then: MV’ = PQ In…
Christiane Baumeister shared this snapshot as of the week ending on Oct 29, 2022 compared to the same week one year ago, measured in growth rates relative to long-run national average growth, as measured by the Buameister/Leiva-Leon/Sims weekly economic conditions index.…
Industrial production declined 0.1% m/m, vs. Bloomberg consensus +0.2. NFP employment rose in October strongly. Other key indicators followed by NBER Business Cycle Dating Committee. Figure 1: Nonfarm payroll employment, NFP (dark blue), Bloomberg consensus as of 11/16 (blue +), civilian…
Atlanta Fed GDPNow at 4% q/q in Q4. Figure 1: GDP as reported (black), WSJ October survey (red), GDPNow (tan square), and Goldman Sachs (green triangle), all in bn. Chained 2012$, SAAR. . Source: BEA 2022Q3 advance, WSJ, Atlanta Fed, Goldman…
Remember the question a skeptical JohnH asked on 9/2/2022, about the Ukrainian offensive? Here’s the answer: Source: Militaryland, accessed 11/11/2022. From CNN: In a huge setback for the Kremlin, Russian troops withdrew from the Kherson region west of the Dnipro River, and images geolocated…
Looks like the betting is on Democratic control. Source: PredictIt, accessed 11/11/2022, 9:18am ET.
M/M headline vs. core vs. trimmed mean vs. median: Figure 1: Headline CPI inflation (blue), core CPI (tan), 16% trimmed mean CPI (green), median CPI (red), m/m annualized, %. NBER defined peak-to-trough recession dates shaded gray. Source: BLS, Cleveland Fed via…
M/M CPI inflation 0.4% vs. Bloomberg consensus 0.6%, while core was 0.3% vs. 0.5%. All measures (m/m, q/q, y/y, headline/core) below recent peaks. Figure 1: Headline CPI inflation, m/m (blue), q/q (red) and y/y (green), annualized, %. NBER defined peak-to-trough recession…
By simple addition of bets on 50 seats or less for Republicans — at 1030am Eastern Time, from PredictIt: Source: PedictIt, accessed 11/9/2022 at 10:30am Eastern. Note also the probability of Republican House, Democratic Senate is at 62%.
The trend in real median weekly earnings looks different depending on deflator. Figure 1: Median weekly earnings, deflated by CPI (blue), deflated by Chained CPI seasonally adjusted (tan), both in logs, 2010Q4=0. NBER defined peak-to-trough recession dates shaded gray. Chained CPI…
Oil prices are down, and futures are in backwardation. Gasoline prices are also (way) down from June peaks. Figure 1: Oil price of WTI, monthly average (blue), and NYMEX futures price as of 11/4 (brown), $/bbl, on log scale. Source: EIA…
At least as of now. But at end 2003, there was. But not as of January 2002. Figure 1: GDP as of 1/30/2002 (blue), as of 12/10/2003 (tan), as of 10/27/2022 (green), in Ch.2012$ in logs, 2001Q1=0. NBER defined peak-to-trough recession…
Fix this gap: Source: Ryan, et al. “No fall chill evident in October employment,” Monthly Chartbook, Deutsche Bank, Nov. 4, 2022.
The recession is (probably) not here yet (nor was it likely here earlier this year), employment likely continued to grow, and real wages are on average higher than they were before the pandemic. First, key business cycle indicators followed by the…
Two of the methodologies discussed in the post on the recent nowcasting provide insights into the state of the economy. Figure 1: Lewis-Mertens-Stock (NY Fed) Weekly Economic Index (blue), Woloszko (OECD) Weekly Tracker (tan), Baumeister-Leiva-Leon-Sims Weekly Economic Conditions Index for US plus…
and on the eve of the October employment report. With monthly GDP on Tuesday, and consumption and income last week, we have the following picture of some key series followed by the NBER Business Cycle Dating Committee (NBER BCDC): Figure 1:…
What assumptions were made? Reader Anonymous asserts Hubbert “…did not say under existing technologies” when peak oil production would be reached. However, on page 24 of the original Hubbert (1956) document, we find the following passage: One other contingency merits comment.…
Expected economic activity, medium term market based inflation expectations, and risk/uncertainty measures. Figure 1: Ten year-three month Treasury spread (blue), ten year-two year spread (red), both in %. Source: FRB via FRED, Treasury, and author’s calculations. Inversion of both term spreads is…
Today, we’re pleased to present a guest contribution by Laurent Ferrara (Professor of Economics at Skema Business School and Board Member of the International Institute of Forecasters). On Friday 21 October, we organized with Catherine Doz at Paris School of Economics…
As of 23:00 hrs (GMT+2) on 10/31 (Militaryland.net): Note the funny looking symbols above the Russian units (a II for battalion with an inverted “U” shaped symbol) denotes battalion tactical group (BTG), a combined arms group of roughly battalion size.
Statistics through 2022Q2 – rapid growth in natural gas exports but from small base. LNG exports contribution to change in goods exports quantitatively trivial. Figure 1: Non-natural gas, non-LNG exports (tan bar), natural gas exports (green bar) and LNG exports (blue…
Today, we are pleased to present a guest contribution written by Joshua Aizenman (University of Southern California). In the Reykjavik roundtable on global economic challenges, September 1-2, 2022, organized by Robert McCauley, Robert Aliber, Gylfi Zoega, and Mar Gudmundsson, I overviewed my research…
Reader JohnH asserts: LNG is the US’ third largest export and fastest growing. But I believe he/she misread the table in the article (see table at end of this post), and it’s natural gas and LNG combined that is the third…
One of the seminal empirical exchange rate papers is Charles Engel‘s and Jim Hamilton‘s “Long swings in the exchange rate: are they in the data and do markets know it?” (AER, 1990). Think about it – while one often can’t reject…
As noted by Jim in his post on the 2022Q3 GDP release, exports and imports accounted (mechanically) for more than 100% of 2022Q3 GDP growth: Figure 1: Top panel: GDP growth (blue); Bottom panel: consumption, investment and government spending (blue bar),…
Today, we present a guest post written by Jeffrey Frankel, Harpel Professor at Harvard’s Kennedy School of Government, and formerly a member of the White House Council of Economic Advisers. An earlier version appeared at Project Syndicate and LA Times. …
Jim will have more in a few hours, but for now, here is GDPNow as of 10/26, compared to monthly GDP (as of October 4), and the Philadelphia Fed Concident Index. Figure 1: Coincident index for US (teal), monthly GDP from…
Here’s industrial production (Fed, Miron-Romer) index during the 1920-21 recession, as reader Steven Kopits thinks this is the template for a conjectured current ongoing recession (or incipient – the conjecture keeps on changing). Figure 1: Industrial produciton from Federal Reserve (blue),…
Reader Steve Kopits, after again asserting that VMT, gasoline consumption, GDP all imply recession in H1 2022, writes as his clinching argument “And apparently, the public is none too enamored of macro indicators, either, given recent polling heading into November.” I…
From the memo : The dollar has strengthened sharply with respect to the currencies of many industrialized nations and emerging markets to reach a 20-year high. This appreciation of the dollar is viewed as a major global challenge for most countries, especially…
Monthly indicators followed by the NBER Business Cycle Dating Committee, plus GDP and GDO, plus IHS-Markit (nee Macroeconomic Advisers) monthly GDP: Figure 1: Nonfarm payroll employment (dark blue), Bloomberg consensus as of 10/25 for NFP (blue +), civilian employment (orange), industrial…
After several days’ worth of delay, NBS released Q3 GDP, 3.9% y/y and q/q (not annualized), vs. 3.4% and 3.5% Bloomberg consensus (thereby ending the suspense). This is the picture, using an index. Figure 1: Index of Chinese real GDP, based…
That’s the question a skeptical JohnH asked 7 weeks ago, about the Ukrainian offensive. The answer seems to be “pretty well”. Source: Militaryland, accessed 10/23/2022, 3:30pm Pacific. From ISW (dated 10/22): Russian forces continued to withdraw from western Kherson Oblast while…
A question becoming increasingly relevant as China cuts back on statistical releases. From Burn-Murdoch at FT: In this context, one can view the recent delay of Q3 GDP release as emblematic of a continuous process of dismantling the technocratic elements of…
The conference took place a month ago, but the video links are now up, The them of the conference: Forecasters often need to predict the present—or “nowcast’’—to help inform policy decisions. The onset of the pandemic highlighted the importance of nowcasting…
It seems that recession is imminent, according to some accounts (60% in 10/14 Bloomberg panel, 63% in the WSJ October survey, 100% in the Wong/Winger model). WaPo “As recession fears rise, Washington begins to weigh how to respond”. What do some…
As measured by NY Fed WEI, OECD Weekly Tracker, and Baumeister, Leiva-Leon and Sims WECI. Figure 1: Lewis-Mertens-Stock (NY Fed) Weekly Economic Index (blue), Woloszko (OECD) Weekly Tracker (tan), Baumeister-Leiva-Leon-Sims Weekly Economic Conditions Index for US plus 2% trend (green). Lilac…
From GS: Source: GS, Oct 11, 2022
It would’ve been a partial mystery even if NBS had released the number. Now it’s even more of a mystery, as the release has been delayed indefinitely (Trade data is a mystery too…) Here’s reported GDP, Bloomberg consensus, and the IMF…
From Heli Simola, BOFIT, in “War’s price tag…”, consensus forecasts from February and from September: Source: Simola, BOFIT (October 18, 2022). Not as bad as forecasts from end-March (see this post), but in line with those from early March (see here).…
Podcast on EconoFact. The recent strength of the dollar highlights the impact exchange rate movements can have. In addition to economic impacts, these include far-reaching social and political effects too. Jeffry Frieden, a leading scholar on the political economy of exchange…
Industrial and manufacturing production both at 0.4% m/m growth, above consensus (0.1% and 0.2%, respectively) in September, showing resumed growth. This is the picture of key macro indicators followed by the NBER Business Cycle Dating Committee, plus IHS-Markit monthly GDP. Figure…
Answer: Not much. This point is critical in assessing how appropriate conditional forecasts of inflation were, especially those pertaining to 2022. Textual analysis and market indicators. First up, the Geopolitical Risk Indicator and Economic Policy Index: Figure 1: US Economic Policy…
As measured by NY Fed WEI, OECD Weekly Tracker, and Baumeister, Leiva-Leon and Sims WECI. Figure 1: Lewis-Mertens-Stock (NY Fed) Weekly Economic Index (blue), Woloszko (OECD) Weekly Tracker (tan), Baumeister-Leiva-Leon-Sims Weekly Economic Conditions Index for US plus 2% trend (green) Source: NY…
According to Senator Ron Johnson, this is the reason (Milwaukee Journal Sentinel, March7, 2022): “I don’t think Vladimir Putin would have moved on Ukraine were it not for the weakness displayed ― certainly by the Biden administration, but by the West…
From NOAA : (h/t 2slugbaits) I really do not see a “pause” as enunciated by one commentator. (Same guy who contends by linking to FRED, I manipulated BLS data – he’s never apologized for that…)