While Q4 GDP was revised down to 2.2% from just 2.6%, things are better than they appear. The revision was entirely due to slower inventory accumulation. Excluding inventories and trade gets at real domestic demand, and it grew at a…
Net neutrality is a fight over who pays for Internet infrastructure. Now, large content providers (Netflix) help pay, but under the new FCC rules they won’t be allowed to. Thus, households will pay more. But as they are more price…
The Friday File: The evidence that the economy is improving is now irrefutable as the tooth fairy left an average of $4.36/lost tooth in 2014, a whopping increase of 25% from 2013. As recently as 2011, the TF left a…
The January CPI numbers came out today and Y-o-Y inflation was -0.2%, yes, prices actually fell one-fifth of one percent. Before rejoicing, note that deflation is a double-edged sword. On one hand, it boosts worker pay since any raise is…
By not reducing the supply of oil in the face of falling demand, Saudi Arabia has caused the price of oil to plummet. That has caused households to increase their real consumption of gasoline by 4%, boosted purchases of light…
The Taylor Rule, a formula proposed by Stanford Professor John Taylor, tells the Fed how to set short-term interest rates. They are to be determined based on three variables: the gap between the actual inflation rate and the desired inflation…
Despite a generally strengthening economy, the combination of surprisingly cold weather in the Northeast and parts of the Midwest, declining capital expenditures (due primarily to falling oil prices) and weak exports (due a strengthening dollar) will reduce Q1 GDP growth…
The Friday File: The US cattle herd (including beef and dairy cattle) increased from 89 million in 2013, its lowest level since 1951, to 89.8 million in 2014. And the number of heifers being added to the beef-cattle breeding herd…
Minutes from the last Fed meeting were released yesterday and the Fed is covering the bases. While some want to raise rates in June, most don’t as they see more downside than upside risk, including weakening exports and a worsening…
Despite a generally strengthening economy, the combination of surprisingly cold weather in the Northeast and parts of the Midwest and declining capital expenditures (due primarily to falling oil prices and weak exports due a strengthening dollar) will reduce Q1 GDP…