Posts Tagged ‘Graphsandlaughs’
Jobless Recoveries
In recessions between 1950 and 1982, GDP always fell by more than employment, and as a result productivity per worker declined. Starting with the 1990-91 recession, things reversed. In that recession, GDP declined 1.2% yet employment fell by 1.7%. In the 2001 recession, GDP fell by 0.3% while employment fell by 1.2%, and in the…
Read MoreHorsing Around
The Friday File: The highest-priced stallion syndication was for Fusaichi Pegasus at a reported $60 million in 2000, while the record stud fee remains $500,000 for Northern Dancer in the mid-1980’s. The most paid for a thoroughbred at auction was $16 million in 2006 for two year-old The Green Monkey (who retired from racing after…
Read MoreDiminishing Deficit
The US trade deficit was $38.8 billion in August, virtually unchanged from July and has been hovering around $40 billion/month since early 2010. Before the Great Recession, it was about $60 billion/month. The difference, oil imports are down about $20 billion/month due to rising domestic production. Our deficit with China was $29.9 billion last month.…
Read MoreWeak Work
The 148,000 new jobs reported in the delayed September employment report are profoundly disappointing. New jobs have now averaged 143,000 this past quarter, 182,000 in Q2 and 207,000 in Q1. At the current rate, it will take until September 2014, or 68 months, to bring the total employment level back to where it was in…
Read MoreMoving Money
The velocity of money is the number of times a unit of currency is used to buy domestically produced goods and services during a fixed period of time. The velocity of M1 (cash and checking accounts) has fallen by 38% since the start of the Great Recession, while M2 (M1 plus savings accounts, CDs and…
Read MoreDeficient Data
The CPI is based on 83,300 price quotes/month, but because the government was closed for 11 working days in October, the sample will be based on 40,000 price quotes. Because price quotes for some items are collected bi-annually, it will take six months for inflation data to fully recover from the small October sample. Worse,…
Read MoreRepresentative Salaries
The Friday file: Legislators in CA are paid best at $90,000/year, with PA second at about $83,000/year. NY is third at $79,000, followed by MI and IL at about $70,000/year. By contrast, NM pays legislators nothing, NH pays them $100/year, AL $1,000/year and MT $3,700/year. With 120 legislators for 38 million people, lawmakers in CA…
Read MoreInsanity Defined
After reducing Q4 GDP by 0.5% or $20 billion and achieving no meaningful policy changes by forcing a government shutdown, Congress now promises to reward us with potentially more of the same in early Q1 2014! While this will hurt consumer confidence and slow our recovery, it’s a boon for bond investors and emerging markets…
Read MoreNobel Winners
In an odd choice, the Royal Swedish Academy awarded the Nobel Prize in economics to Eugene Fama, whose life’s work shows that markets are rational in the short run, to Robert Shiller, who says that markets are often irrational over long periods, and to Peter Hansen, who developed a statistical approach to study asset prices,…
Read MoreDebt Default
If the US defaults, short-term Treasuries, the most traded and liquid securities in the world and which often act as collateral for loans to banks and central banks, would lose their cash equivalence. This would immediately boost interest rates demanded by lenders while some lenders would refuse such collateral outright. Worse, as short-term funding is…
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