Econ70
Over the past year, house prices have risen a whopping 18.8%, due largely to Covid-19 and the WFH phenomenon. To wit, over the past 12 months the largest house price gains have been in warm weather cities like Phoenix, Tampa,…
Dating back to 2012, the Fed has correctly predicted the fed funds rate, a rate they literally control, 37% of the time, core inflation 29% of the time, unemployment 24%, and Real GDP growth 17%. Moreover, the Fed is consistently…
Generally, buying a commodity today is less costly than agreeing today to buy for future delivery because of storage costs and risk. Sometimes, however, the current commodity price exceeds the cost of buying it today for future delivery. This describes…
The 2-yr Treasury rate is 1.60%, the 10-yr, 2.00%, a difference of just 40bps. Due to high inflation, the Fed is planning to raise short-term rates by at least one percentage point and maybe 1.75 percentage points by 12/31/22. Raising…
To best understand how inflation is likely to play out, many variables need to be properly forecasted. They are, in no particular order, inflation expectations of workers, bargaining power of workers, productivity growth of workers, pricing power of firms, the…
Since cratering in spring 2020, the US economy has dramatically outperformed the economies of other developed nations. The only exceptions, labor force participation and inflation. While the labor force has recovered or nearly in other wealthy nations, here it’s substantially…
The Friday File: Valentine’s Day spending is expected to total $23.9 billion, almost equal to the GDP of Iceland (the 112th largest economy out of 216), and up from $21.8 billion last year. This remains shy of the $27.4 billion…
The current 117th Congress, running from 1/3/21 to 1/3/23 has passed 85 bills with 11 months to go, and is on a pace to pass just 157 bills. The fewest number of bills passed in any two-year session of Congress,…
The only other time the Fed shrank its balance sheet was in 2018, and rates declined, the opposite of what should have happened. Here is maybe why. As the Fed shrinks its balance sheet it sells bonds and acquires cash…