Econ70

While the failures of Silvergate and Signature are purely crypto related and meaningless, there are two lessons to be learned from the failure of SVB. First, major risks to the financial system can come from non-money-center banks, and second, borrowing…

The Friday File: During 2022, the average amount left by the Tooth Fairy per lost tooth was $6.23, up from $5.36 in 2021, a solid rise of 16%. The Tooth Fairy was most generous in the South leaving $6.59, followed…

We are entering peak home selling season. The months with the highest premiums over asking price are March (8.9%), April (9.2%), May (12.6%), June (10.7%), and July (10%). The five days when sellers are likely to receive the highest premium…

Used-car prices are down 7% Y-o-Y, but up 4.3% M-o-M, the third month in a row of M-o-M increases, and the largest February rise since 2008. The car market remains about five million units short from the computer chip shortage,…

As recently as 1980, it took S&P 500 firms, on average, eight employees to produce $1 million in inflation-adjusted revenue. By 1990, it was six people, and by 2000, four. Lest you think productivity slowed, by 2010 it took just…

Monetary policy works most quickly via the most interest rate sensitive sectors of the economy, autos and housing. However, for very different reasons, both sectors have successfully resisted the impact of higher rates. Car sales are rising as semiconductor supply…

The Friday File: The city with the worst traffic is London where the average travel time per 10 kilometers (6.21 miles) is 36 minutes 20 seconds. In second is Bengaluru, India at a time of 29 minutes 10 seconds. Third…

22Q4 GDP came in at 2.7%, down from 3.2% in 22Q3, primarily due to softening consumer spending, suggesting weakening. However, in January the Fed’s favorite inflation measure meaningfully rose, with December’s reading being revised upwards. Consumer spending jumped 1.8% M-o-M,…

Venture-capital firms raised a grand total of $20.6 billion in 22Q4, a 65% decline from a year ago, the lowest fourth-quarter amount since 2013, and returns fundraising to levels last seen in 2015. It was also less than half the…

The Fed is currently focusing on what is called super-core inflation, defined as overall CPI minus food and energy, goods, and housing. Food and energy are 11% of consumer spending, housing is 16%, and goods are 24%. Thus, super-core inflation…