• Modest Moving

    Just 9.8% of Americans changed their residence between 2018 and 2019, the lowest percentage since such record keeping began in 1947/48! This new low is occurring amidst the weakest population growth on record, limited immigration and an aging society. Most troubling, however, just 20% of those … [Read More...]

  • Tariff Travails

    Prior to slapping tariffs on China, US tariff revenues were $3 billion/month. They’re now $7 billion/month; an increase of around $50 billion/year or 0.25% of GDP. Thus, GDP has been reduced by at least this much, and realistically much more because some purchases are simply not made and we’re … [Read More...]

  • Nobel Noteworthy

    Earlier this morning, the Nobel Prize in Economics was awarded to a trio of economists, Abhijit Banerjee and his wife Esther Duflo (only the second woman to win an Economics Nobel and the youngest recipient ever at 46) both from MIT, and Michael Kremer of Harvard. They won the award for their … [Read More...]

  • Substantial Savings

    From 1980-2007, US savings rates declined from about 10% to 2.5%. They have since risen and are now 8.1%. Unsurprisingly, savings rose after the recession as households rebuilt wealth. Rates may also be up due to rising economic uncertainty. But savings rates jumped dramatically after the Trump tax … [Read More...]

  • F&F Fix

    Here’s how to shrink/fix Fannie and Freddie. First, reduce the threshold for a conforming loan to 1.5 times the median price of an existing single-family home, which is currently $284,000. Second, end support for vacation homes and cash-out refi. Third, start treating F&F like banks when it … [Read More...]

Dec
04

Realtor Reality

Residential real estate commissions typically are 6%, split between buyer and seller agents. Importantly, the seller pays the commission to both agents. If the seller offered less, selling agents wouldn’t show the home. Thus, commissions stay high, but the median Realtor earned just $49,000 in 2018. … [Read more...]

Dec
03

Modest Moving

Just 9.8% of Americans changed their residence between 2018 and 2019, the lowest percentage since such record keeping began in 1947/48! This new low is occurring amidst the weakest population growth on record, limited immigration and an aging society. Most troubling, however, just 20% of those … [Read more...]

Dec
02

Nasty Non-competes

One reason wage growth has been weak is the rise of non-compete clauses in employment contracts. The percentage of US workers who have signed a non-compete is now 20%! Not surprisingly it’s 40% for those with professional degrees, and 30% for workers with a MA. But it’s 25% for those with a BA, and … [Read more...]

Nov
29

Party Purchasing

The Friday File: In addition to US politics becoming increasingly tribal, so is our shopping! While the CNN (Democrats), Fox (Republicans) viewership divide is well known, the NBA is now 50% more popular among Democrats than Republicans. By contrast, NASCAR is twice as popular among Republicans. … [Read more...]

Nov
27

Terrific Thanksgiving

The first Thanksgiving was celebrated in 1621, and President Lincoln proclaimed Thanksgiving a national holiday on 10/3/1863. 96% of Americans celebrate Thanksgiving, and along the way we spend $550 million buying turkeys. The first Thanksgiving college football game took place in 1876; the first … [Read more...]

Nov
26

Parental Pay

In 1940, the percentage of children who earned more than their parents by age 30 was 92%. The percentage fell to 80% by 1950, and from 1960-1975 it held at 60%. It’s since continued to fall and is now 50%. There are several reasons for the decline. GDP growth has slowed as our economy has matured … [Read more...]

Nov
25

Billionaire Bias

While taxing billionaires is now very chic, the notion that they are the result of bad/failed government policy is wrong. It heavily depends on the competitiveness of the market. Google and Facebook are monopolists and earn excessive profits as competition has failed, moreover, those firms have … [Read more...]

Nov
22

Dollar Duration

The Friday File: The average dollar bill lasts 5.8 years. The average $5 bill, 5.5 years, while the $10 bill lasts just 4.5 years, less than any other note. $20s average 7.9 years, $50 bills last a slightly longer 8.5 years. The longest lifespan, the C-note at 15 years. The Bureau of Printing and … [Read more...]

Nov
21

Trade Truce

If the US-China trade war does not worsen and President Trump doesn’t increase tariffs on Chinese imports on 12/15/19, the trade war’s negative impact on GDP here and China should end by 12/31/20. The cumulative reduction in Chinese GDP is likely to be about 0.75% or about $105 billion, and about … [Read more...]

Nov
20

Housing Hooray

With manufacturing, capital spending by firms, transportation, agriculture, and energy all weak, the relatively good October housing starts were particularly pleasing. Starts were up 8.5% Y-o-Y, are at their second-best level since 5/18, and single-family starts have been rising since May. … [Read more...]