There are two main interpretative frameworks that seek to explain slow growth and low interest rates. The first is associated with Rogoff and Rinehart. They argue that the recent economic performance is largely what should be expected...
The US grew 156k jobs in August, missing the median estimate by about 16k. The July series was revised up by 16k. The unemployment and participation rate ticked up 0.1% to 5.0% and 62.9% respectively.
Much of what the Bank of Japan announced today had been largely leaked. While there was a sizable response in the asset markets, the dollar's knee-jerk gains against the yen were quickly unwound. The BOJ lifted its self-imposed...
There has been much discussion in the US presidential campaign about immigration, especially from Mexico. Trump has proposed a wall for the 2000 mile border. Different types of fences are on about a third of the border as it stands today.
The US dollar was already trading with a heavier bias before the shockingly poor service ISM. The August non-manufacturing ISM tumbled to 51.4, a six-year low, from 55.5 in July. Markit, which does its own survey, showed a smaller decline...
The World Bank sold the equivalent of about $700 mln in a three-year multiple currency bond that duplicated the composition of the IMF's Special Drawing Rights or SDR. There has been much fanfare. It is the first SDR bond in more...
This Great Graphic comes from the Wall Street Journal. It shows what is happening to the pay of the least compensated in the US. Their pay is going up at a pace that is exceeding the averages and inflation.
Today is the anniversary of the final blow to the dollar-gold standard. By August 15, 1971, the exchange of dollars for gold was limited to central banks, and US President Nixon unilaterally ended it. There was a brief attempt to resurrect...
Former Fed Chair Bernanke keeps a blog at Brookings. His latest post offers insight on how to think about the Federal Reserve’s and, in particular, Fed officials' understanding of the US economy.
This Great Graphic, created on Bloomberg, depicts the Federal Reserve's real broad trade-weighted index of the dollar. Real means that it is adjusted for inflation differentials. Broad means that it covers a wide number of US partners.
Until now the recovery from the Great Financial Crisis has been the weakest from the post-WWII compared to the last four contractions. However, as Kruger points out, assuming that the Atlanta Fed's GDP tracker is accurate, this dour assessment will no longer hold...
The conventional narrative has it backward. It worries about the threats to stability emanating from the periphery of Europe. Policymakers, investors, and economists still refer to the "Greek, Irish, Portugal and Cyprus' bailouts.”
The assassination of Jo Cox has broken the powerful momentum in the markets. Investors recognize that the tragedy potentially injects a new element into consideration for the outcome of next week's referendum. The campaigns will...
For investors, the most important thing about the favorable review of Greece's implementation of last year's agreement is that it effectively removes it from the list of potential disruptive factors in the coming quarters.
The US dollar has had a rough few months. It has fallen against most major and emerging market currencies this year. A critical issue for global investors and policymakers is whether the dollar’s uptrend is over, or is this just a respite.
At the IMF/World Bank meetings this week, Chinese officials are again pushing for greater use of the IMF's unit of account, Special Drawing Rights. It is China's turn as the rotating host of the G20, which gives it greater influence over its agenda.
The weekend meeting between many OPEC and non-OPEC producers has helped spur the recent gains in the price of oil. We are concerned that market may be getting ahead of itself. First, the freeze in output that had previously...
Helicopter money is the rage. Central banks are talking about it. Economists are debating it. The media is rife with coverage. While it sounds important, it is not precisely clear what helicopter money means.
An ill-conceived strategy undermined by mismanagement and bad fortune is increasing the risks that the UK votes to leave the EU in June. Nearly everything that could have gone wrong for UK Prime Minister Cameron.
Investors are skeptical of Chinese economic data. However, news yesterday that Chinese exports fell by a quarter in February shocked investors. Many worry about the implications not just for China, but for world growth. It comes as the IMF...
