The Bowtie Economist's Daily Dose of 70-Word Wisdom

Over the last 50 years, has energy spending risen or declined? The answer is both! In 1970, inflation-adjusted US energy expenditures totaled about $500 billion, in 2022 they were $1.7 trillion, they more than tripled. On a per capita basis,…

During Powell’s recent Jackson Hole speech, he repeatedly said the labor market is weaker than pre-Covid, when Fed funds was 1.75%! Currently, markets are expecting a terminal Fed funds rate of 3.25%, with 100bps of cuts through December and another…

The latest 24Q3 GDP estimate from the Atlanta Fed is 2%, down from 2.9% a week ago. Similarly, the NY Fed sees 1.8%, down from 2.2%, and the St. Louis Fed sees 1.3% growth, down from 1.6%. Averaging the three…

The Friday File: Starbucks’ Pumpkin Spice Latte debuted 21 years ago in 2003 in just 100 stores in Washington, DC and Vancouver, WA. It was so popular, in 2004 PSL was rolled out nationwide and October sales instantly jumped 25%.…

Seasonally adjusted annualized July housing sales came in at 3.95 million, the 35th straight month of Y-o-Y declines, and the fifth month of sub-4 million sales, a level historically rarely seen. Troublingly, 30-year rates are 81 basis points lower Y-o-Y…

For the year ending 3/24, estimated job growth has been preliminarily revised down by 818,000, bringing average job growth down from 242,000/month to 174,000/month. The revision is based on data from state unemployment insurance tax records, not low response rate…

Gold recently surpassed $2,500/oz and has been rising rapidly since 10/22, when it traded at $1,650/oz. A major reason, central bank buying. From 1970-1988, cumulative net central bank gold purchases were roughly zero. From 1989-2009, banks were net sellers every…

Two recent papers show the detrimental effects of gambling. One reports that where gambling is legal, average credit scores drop 0.3% after four years, and where online betting is legal, they drop by 1% and bankruptcy filings rise 25%-30% within…

The Friday File: It’s always critical to remember that correlation is not causation. For example, there is a .93 correlation coefficient (CC), and an R-Squared of .86 between the name Bailey and attendance at Cleveland Indians/Guardians baseball games between 1975-2019.…

July CPI fell to 2.9%, its lowest level since 3/21, while the more important core measure hit 3.2%, its lowest since 4/21. Moreover, over the last three months core CPI is up 1.6% annualized, down from 2.1% in June. The…