A cornerstone of international trade is nations that run trade surpluses can be confident that the money they acquire by running trade surpluses, almost always US dollars, will hold its purchasing power over time. If there is a move away…
Despite fears of inflation, it’s currently benign no matter how measured. The CPI is up 2.1% year-over-year while the core CPI (which removes food and energy) is up just 1.9%. The PCE, the Fed’s preferred inflation measure, is up 1.6%…
The Friday File: The seventh busiest and fifth longest subway system in the world is the New York City subway which had ridership of 1.7 billion in 2012 and has 368km of track. The busiest is the Tokyo system which…
Absent wage growth, it’s not possible to have sustained economy wide inflation. This is because it’s only increasing wages that allow people to continually pay more money for goods and services. If wages don’t rise, price for individual items can…
Today’s Q2 GDP estimate came in at 4%, better than expected. Moreover, the dismal -2.9% estimate of Q1 GDP was revised up to -2.1%. As for the underlying components, consumer spending increased at a 2.5% annualized rate, which is solid,…
While the Fed has been right to keep rates low because inflation has been totally benign for years, that doesn’t mean they will start raising rates at the right moment. They would much prefer to raise rates late and be…
Should Argentina not pay its bondholders by Friday, it will default for the second time in 13 years. Argentina is paying investors who swapped their previously-defaulted bonds for new, less valuable bonds, but isn’t paying investors who refused the swap.…
The Friday File: Since recreational marijuana first became legal in Colorado on 1/1/14, an estimated 485,000 Coloradans, or 9% of the state’s population of 5.4 million, consume marijuana at least once a month. Of those 485,000 consumers, 30% or 145,500…
Prior to the recession, the average homeowner’s equity percentage in their home was 60%. That percentage is now 53.64% and has been rising steadily since bottoming out at 36.6% in Q1/09. This suggests we are quite close to fully recovering.…
While existing home sales fell 2.3% in 6/14 to 5.04 million from 5.16 million a year earlier, don’t worry. Sales are at their highest level in eight months, and more importantly distressed sales are down from 15% of all sales…