Insignificant Inflation

Inflationary pressures are very weak. Y-o-Y February CPI is 1.5%, with core CPI at 2.1%, both down from January. February producer price inflation was 1.9%, also down from January. Meanwhile, the Fed’s favorite inflation measure was 1.4% in January, the lowest rate since 9/16, while core was just … [Read more...]


Solid Sales

GDP fluctuates dramatically quarter-to-quarter primarily because of three variables: government spending, inventories and exports. Stripping these variables out, one is left with a less noisy sequence that gets at the underlying strength of the US economy by zeroing in on sales to domestic buyers. … [Read more...]


New Names

To reduce the national debt by $30 billion, the Interior Department is selling naming rights to the Liberty Bell to Taco Bell. Henceforth, the bell will be the Taco Liberty Bell. Relatedly, the Lincoln Memorial is being sold to Ford and will be renamed the Lincoln-Mercury Memorial. In DC, the … [Read more...]


Super Skiers

The Friday File: A few months ago, Lindsey Vonn, 34, retired from competitive skiing. Statistically, she is the greatest women’s skier ever, ahead of the great Anna-Marie Moser-Proell of Austria. Her 82 World Cup victories place her second behind Ingemar Stenmark of Sweden. However, at 23, Coloradan … [Read more...]


Trade Tempering

The January US trade deficit was $51.2 billion, down from $59.9 billion in December. Exports rose 0.9% to $207.3 billion; imports fell 2.6% to $258.5 billion. The deficit with China fell 14% to $33.22 billion, primarily because firms raced to get products into the US ahead of a threatened tariff … [Read more...]


Declining Domiciles

Home prices in the swankiest parts of the most expensive cities are declining. In part it’s due to slowing wealth creation; fewer millionaires/year are being minted. Also, stronger capital controls have made it harder to ferry money out of China. Transaction taxes on foreigners have hurt; increase … [Read more...]


Bad Boeing

The Boeing 737 MAX accounts for about 25% of domestic aircraft production. If MAX production is halted, it would knock about 0.5%-point off quarterly annualized GDP growth. For context, 19Q1 GDP growth is currently expected to be 1.5%, ignoring Boeing. If Boeing keeps producing but temporarily can’t … [Read more...]


Inversion Indignation

This past Friday the yield curve inverted; the 10-year rate fell below the three-month rate, the first time in over a decade. This is significant because an inversion has preceded each of the last seven recessions, often by years. Since 1965, there have been two inversions not followed by a … [Read more...]


Basketball Bonanza

The Friday File: About 500,000 vasectomies/year are performed in the US. The recuperative time is 2-3 days. Not surprisingly, Fridays are the most common day to have the procedure as it gives a weekend to recover. But some weekends are more equal than others. During the first round of the NCAA Men’s … [Read more...]


Changing Constituents

Over the past several years, the Democratic and Republican parties have drastically realigned. The Democrats increasingly represent higher income, college educated, coastal voters. As such, how can they realistically advocate for tax increases? Similarly, the Republican party increasingly represents … [Read more...]