Business Cycle Indicators, 16 October

With the release of industrial production figures today, the deceleration in economic activity continues, according to some key indicators noted by the NBER’s Business Cycle Dating Committee (BCDC).

Figure 1: Nonfarm payroll employment (dark blue), Bloomberg consensus for October as of 10/16 (light blue square), industrial production (red), personal income excluding transfers in Ch.2012$ (green), manufacturing and trade sales in Ch.2012$ (black), and monthly GDP in Ch.2012$ (pink), all log normalized to 2020M02=0. Source: BLS, Federal Reserve, BEA, via FRED, Macroeconomic Advisers (10/1 release), NBER, Bloomberg, and author’s calculations.

Industrial production fell -0.6% m/m vs. Bloomberg consensus of +0.5%. The series was revised upward in August, so the level of industrial production was still higher than the earlier estimate for August. Nonetheless, if it’s the trajectory that’s of interest, then this is not good news. Note that this decline is not driven by mining and/or utilities output decline. Manufacturing production fell -0.3 m/m vs. consensus of +0.7%.

Bloomberg consensus as of today for the October employment figures is 850K new jobs (as shown in blue square in Figure 1). I wonder if this number takes into account the surge in Covid-19 around the country. If one looks at the Covid-19 hospitalization figures, one has to wonder if employment growth — such as it is — can be maintained.

Figure 2: Nonfarm payroll employment (dark teal, left log scale), Bloomberg consensus for October as of 10/16 (light blue square) and Covid-19 hospitalizations through 10/15 (brown, right log scale). October hospitalizations log linearly interpolated from first half of October. Source: BLS, Covid Tracking Project accessed 10/16, and author’s calculations.


82 thoughts on “Business Cycle Indicators, 16 October

  1. The Rage

    The “surge” isn’t strong enough right now. This feels like a very whiny post.
    1. California/NYC both went into level 3 reopening in September that boosted overall consumption growth
    2. NFP is likely to be revised up in September and 800-1000000 is likely in October as a result.
    3. Debt contraction is not happening, instead the debt bubble in reentering the 2000’s again in terms of mania, which creates a short burst of economic activity
    4. Industrial Production is going to suck with the mining bust, which was the main contributor why it rose any in the 2010’s. Its simply not that important. When oil rises as liquidity leaks as the 2020’s progress, this will change.
    5. The Fed screwed up. I have GDP at 3% in the 4th quarter and into the 1st quarter. There is no “collapse” coming because of debt expansion. They really need to start reeling in QE asap or they will have another 2007-8 period(and it may be too late anyways).

    This is why “Stimulus” isn’t needed in terms of transfers. Vaccinations will start in the spring/summer causing another burst in growth. Unemployment will be down to 5.5% at least. Then down to 4.5% by the end of 2022. States simply aren’t shutting down again. You need to accept that and your failings.

    1. Macroduck

      Wow, you are the king of makin’ stuff up! Feels whiney? Feels whiney to you, who don’t really count.

      You know the jobs count is going to be revised up? No, you don’t. You know when vaccines will be available and what the effect on growth would be? Nope. The jobless rate at the end of 2022? C’mon.

      If you had that kind of skill, we’d have noticed by now. You don’t and we haven’t. What nonsense.

      1. Moses Herzog

        Friend, I think “Rage” has been spending too much time reading these type outlets:

        Similar to voucher/”private” schools that rob the taxpayer blind (because over half their intake is taxpayer funded and they create a larger overhead for do-nothing “administrators”, middle management, and kickbacks for vendors, and just out-and-out absconding with money, the MAGA folks now want to be robbed blind and conned for their “news”. Just start counting the seconds until sammy, Ed Hanson, and CoRev start enthusiastically quoting from these sources—if they can ever “tear themselves away” from KKK man and “proud boys” flunky Tucker Carlson or the latest circus freak on FOX news.

        1. macroduck

          Da Nile is a river. And it is just vanity on your part to think you know more about the future than anybody else.

  2. pgl

    On the political front – this will drive Trump crazy:

    Democratic presidential nominee Joe Biden’s town hall on Thursday garnered more viewers than President Trump’s alternate primetime event on NBC, according to Nielsen. Biden’s town hall averaged 13.9 million viewers on Thursday night, significantly trumping the President’s average of 10.6 million viewers on the competing NBC network.

  3. macroduck

    The big rise in retail sales after the end of Covid-related transfers to households I plies a sharp drop in the saving rate. If that’s the case, then this latest rise in consumer demand will run out of steam soon.

      1. macroduck

        Yes, but saving is a flow, not a stock. The accumulation of saving during the spike will show up in the next Fed report on household net worth. We’ll see what it amounts to.

  4. Willie

    What is manufacturing and trade sales all about? It is looking robust in the teeth of a mess everywhere else. As i recall, this confused me before and I probably asked the same question. If I did, then I will be grateful for the same answer again, because it has completely escaped me.

    1. macroduck

      Break that expression into two parts: 1) manufacturing and trade; 2) sales … and inventories. Manufacturing and trade is what it sound like – making stuff and selling stuff. Imports are part of what gets sold, so the imports that get sold count. Some stuff gets sold in any given period and the rest end up in inventory. Here, we are interested in the stuff that gets sold. The monthly retail sales and factory sales reports get added together.

    2. rjs

      Willie, here’s yesterday’s report:
      what it’s about is fairly clear…it a composite “Manufacturing and Trade Inventories and Sales” report for August
      it lags other data by a month, & is released right after the retail sales report publishes the first revision to the prior month. so this report incorporates the revised August retail data from that September retail report and the earlier published August wholesale trade and factory data to give us a complete picture of the business contribution to the economy for that month..

  5. pgl

    Did the village idiot Lawrence Kudlow endorse Marx?

    Massive Unemployment Just One ‘Great Part Of American Capitalism’ Kudlow Insists
    White House economic advisor Larry Kudlow is likely aware that the COVID-19 pandemic has led to millions of Americans losing their jobs, including nearly 900,000 new unemployment claims just last week. But that massive surge in joblessness, he said Friday, is just part of what makes American capitalism great! “The talk is that a lot of folks became unemployed, most regrettably, but they’re sticking with it and they’re going out and starting new businesses,” Kudlow told Fox Business Network host Stuart Varney. “They’re going to be small businesses, but that’s the great part of American capitalism: Gales of creative destruction.

    I get this two faced moron must serve whatever excuses for Trump’s incompetence that Kelly Anne Conway feeds him but creative destruction? Unemployment is a great thing?

    Keynes is rolling in his grave. Marx is laughing his a$$ off.

    1. 2slugbaits

      Or Joseph Schumpeter. I can fell the creative destruction. I haven’t read Capitalism, Socialism and Democracy since I was an undergrad. The one good thing about the pandemic keeping me from going out a lot is that it gives me the time to reread a lot of stuff I haven’t read in almost 50 years.

    2. rjs

      Kudlow is also famous for saying “The human toll here looks to be much worse than the economic toll, and we can be grateful for that,” about the Fukushima disaster..

    3. spencer

      Kudlow is not putting on an act. He has always been very bullish and tells the believers on Wall Street what they want to hear.

      1. pgl

        He has also said he represents the “investor class” which basically means he could care less about the rest of us. Talks about class warfare.

      1. pgl

        “So far in October, 25 U.S. states have reported record increases in new coronavirus cases. The 10 states in dark red reported record increases in new cases on Oct. 15”

        I could not help but notice that many of these dark red states are the politically purple states than Trump eeked a narrow win in 2016. I would hope voters in these states realize by now that Trump is a complete incompetent as far as this issue.

  6. ltr

    October 15, 2020

    How the G.O.P. Can Still Wreck America
    Even if Trump loses, his party can do immense damage.
    By Paul Krugman

    After 2016, nobody will or should take anything for granted, but at this point Joe Biden is strongly favored to beat Donald Trump, quite possibly by a landslide. However, Trump’s party may still be in a position to inflict enormous damage on America and the world over the next few years.

    For one thing, while Democrats are also favored to take control of the Senate, the odds aren’t nearly as high as they are in the presidential race. Why? Because the Senate, which gives the average voter in Wyoming 70 times as much weight as the average voter in California, is a deeply unrepresentative body.

    And it looks as if a president who is probably about to become a lame duck — and who lost the popular vote even in 2016 — together with a Senate that represents a minority of the American people are about to install a right-wing supermajority on the Supreme Court.

    If you want a preview of how badly this can go, look at what’s happening in Wisconsin.

    In 2018, Wisconsin voters elected a Democratic governor. A strong majority — 53 percent — also voted for Democratic legislators. But given the way the state’s districts are drawn, Democrats ended up with only 36 out of 99 seats in the State Assembly. And Wisconsin’s elected judiciary is also dominated by Republicans.

    You probably won’t be surprised to hear that the Wisconsin G.O.P. has tried to use its remaining power to undermine Gov. Tony Evers. What you may not know is that this power grab is now turning lethal….

  7. AS

    Professor Chinn,
    Although real personal consumption is not in the above “key indicators noted by the NBER’s Business Cycle Dating Committee (BCDC)” With today’s release of retail sales and food service sales, FRED series RSAFS, it seems possible that real personal consumption, FRED series, PCECC96 may show about an 8.77% increase from 2020Q2 to 2020Q3, or about 40% annualized (1.0877^4-1)*100. PCECC96 was 11,860 for 2020Q2 and may reach 12,900 for 2020Q3, PCECC96 in billions of chained $2012. Given that real personal consumption represents about 70% of GDP, there is some evidence that 2020 Q3 will do ok(as indicated by the WSJ consensus among others), but perhaps 2020Q4 will suffer as also indicated by consensus forecasts and the above key indicators.

    1. rjs

      AS here has already noted the jump in real PCE, although i’d note that the BEA’s calculation of real GDP adjusts nominal retail sales with an appropriate price index, unlike FRED’s RSAFS, which uses CPI, which means they’re deflating TV and clothing sale with an index that is largely rent and services….the August income and outlays report had real PCE up at a 37.00% annual rate; after today’s 0.3% upward revision to July & August retail, plus the 1.9% September increase, the 3rd quarter increase in real PCE will easily exceed 40% SAAR…

      i would also note that despite the 0.6% decrease in September’s industrial production, it was still up at a 39.8% annual rate in Q3, and that today’s business inventories report (for August) suggests a real increase of around 0.4% for two months…since real private inventories saw a substantial decrease in the second quarter, any real increase in real inventories in the 3rd quarter will thus have a substantial positive impact on 3rd quarter GDP, first by reversing the 2nd quarter drop, and then by incrementally adding to that by the amount of the 3rd quarter increase…

      bottom line: 3rd quarter GDP looks like it will easily print in excess of +30%, with a good chance it exceeds the 2nd quarter drop numerically, despite the increase in the trade deficit….that report will drop on October 29th, giving the appearance of a V shaped recovery just days before the election…

      1. Willie

        It will be too late to matter. A sizeable percentage of the population will have already voted. And people vote based on their perceptions of what is going on, not what numbers get reported. If a voter thinks the economy is doing well now, numbers will confirm if they are good numbers. If a voter thinks all is lousy, that voter will discount good numbers.

  8. ltr

    October 15, 2020

    Republican Judges Are Quietly Upending Public Health Laws
    A catastrophic sequence of decisions has blocked states from responding to the pandemic.
    By John Fabian Witt

    Alongside growing controversy over judicial nominations, court reform and Covid-19 policies, American law is in the midst of a little-noticed paradigm shift in courts’ treatment of public health measures.

    The Republican Party’s campaign to take over the federal and state courts is quietly upending a long and deeply embedded tradition of upholding vital public health regulations. The result has been a radically novel and potentially catastrophic sequence of decisions blocking state responses to the coronavirus pandemic.

    For centuries, American constitutional law granted state governments broad public health powers. “Salus populi suprema lex,” the old saying went: The health of the people is the supreme law. Such authority went back to the beginning of the Republic. In the famous 1824 case of Gibbons v. Ogden, Chief Justice John Marshall defended the “acknowledged power of a State to provide for the health of its citizens.” States, he explained, were empowered to enact “inspection laws, quarantine laws” and “health laws of every description.”

    Lemuel Shaw of Massachusetts, who was arguably the most respected state judge of the 19th century, supported vast public health powers and described states’ authority to control epidemics as central to the sovereign power of government. The Alabama Supreme Court agreed, citing the old dictum of salus populi, and courts in states like Georgia and Louisiana followed. In New York, the state’s highest court upheld disruptive health regulations like a ban on burials in urban church cemeteries. After the Civil War, New York’s courts upheld the Legislature’s decision to vest local boards with “absolute control over persons and property, so far as the public health was concerned.” …

    John Fabian Witt is a law professor at Yale.

  9. ltr

    October 16, 2020



    Cases   ( 8,288,278)
    Deaths   ( 223,644)


    Cases   ( 7,430,635)
    Deaths   ( 113,032)


    Cases   ( 834,910)
    Deaths   ( 85,285)


    Cases   ( 834,770)
    Deaths   ( 33,303)


    Cases   ( 689,257)
    Deaths   ( 43,429)


    Cases   ( 356,792)
    Deaths   ( 9,836)


    Cases   ( 194,106)
    Deaths   ( 9,722)


    Cases   ( 85,646)
    Deaths   ( 4,634)

  10. ltr

    October 16, 2020

    Coronavirus   (Deaths per million)

    US   ( 674)
    Mexico   ( 659)
    UK   ( 639)
    France   ( 510)

    Canada   ( 257)
    Germany   ( 117)
    India   ( 82)
    China   ( 3)

    Notice the ratios of deaths to coronavirus cases are 10.2%, 6.3% and 4.0% for Mexico, the United Kingdom and France respectively. These ratios are high, but have been significantly higher, while falling recently.

  11. ltr

    October 17, 2020

    Chinese mainland reports 13 new COVID-19 cases

    The Chinese mainland on Friday registered 13 new COVID-19 cases, all from overseas, the National Health Commission announced on Saturday.

    No deaths related to the disease were reported on Friday, and 7 COVID-19 patients were discharged from hospitals, the commission said. A total of 374 asymptomatic patients remain under medical observation.

    The COVID-19 tally on the Chinese mainland stands at 85,659, with 4,634 fatalities.

    Chinese mainland new imported cases

    Chinese mainland new asymptomatic cases

    [ There has been no coronavirus death on the Chinese mainland since May 17. Since June began there have been 3 limited community clusters of infections, in Beijing, Dalian and Urumqi, each of which was contained with mass testing, contact tracing and quarantine, with each outbreak ending in a few weeks.

    Currently there is a limited community cluster in Qingdao, with mass testing, contact tracing and quarantine again being used to identify the origin, contain and end the outbreak.

    Imported coronavirus cases are caught at entry points with required testing and immediate quarantine. Asymptomatic cases are all quarantined. The flow of imported cases to China is low, but has been persistent.

    There are now 259 active coronavirus cases in all on the Chinese mainland, 5 of which cases are classed as serious or critical. ]

  12. Steven Kopits

    New cases in the US exceeded 70,000 yesterday. On current trends, I might expect 100,000+ new cases on election day. (For reference, Italy saw 230 new cases / day in late July; 1,400 in late August; 1,700 new cases / day in late September; 2,500 new cases per day ten days ago; 10,000 new cases yesterday. Buckle up. That’s coming our way, too.)

    Meanwhile, September apprehensions at the southwest border were the highest since 2006, during the Bush administration. Expect that number to rise, too. Southwest border apprehensions — and by implication, illegal immigration — were 18% higher on average during the Trump administration than during the Obama administration.

  13. Bruce Hall

    Of the 13 states with the lowest unemployment rate, 11 have Republican Party governors.
    Nebraska 4 1 R
    Utah 4.1 2 R
    Idaho 4.2 3 R
    S. Dakota 4.8 4 R
    Vermont 4.8 4 R
    N. Dakota 5.0 6 R
    Alabama 5.6 7 R
    Georgia 5.6 7 R
    Montana 5.6 7 D
    Oklahoma 5.7 10 R
    Arizona 5.9 11 R
    Iowa 6.0 12 R
    Virginia 6.1 13 D

    Of course that’s a coincidence.

    Of the 13 states with the highest unemployment rate, 11 have Democratic Party governors.
    Nevada 13.2 51 D
    Rhode Isl. 12.8 50 D
    Hawaii 12.5 48 D
    New York 12.5 48 D
    California 11.4 47 D
    Mass. 11.3 45 R
    New Mexico 11.3 45 D
    Illinois 11.O 44 D
    New Jersey 10.9 43 D
    Pennsylvania 10.3 42 D
    Delaware 8.9 39 D
    Ohio 8.9 39 R
    W.Virginia 8.9 39 R

    Of course that’s a coincidence.

    Governing policies during the epidemic couldn’t have anything to do with that.

    1. SecondLook

      “Correlation does not imply causation”

      You know that, of course. Shame you chose your biases over your intelligence – I know, it’s hard to be steady and objective, for all of us.

      1. Bruce Hall


        … and yet Trump will be blamed for the policies of the governors. What “causation” are you implying? Remember that most of the deaths are among those in age groups not working and the policies of states hit hardest by unemployment are affecting those least harmed by the virus.

        I suspect that soon after Biden is elected, the states with the most onerous economic policies will declare “victory”. A vaccine? Look to the flu.

        1. pgl

          Another link which Bruce Hall provided but did not read. Let me help our village idiot out:

          “The 2017-2018 flu season, however, was one of the deadliestin decades, with high levels of outpatient clinic and emergency department visits for flu-like illness and high flu-related hospitalization rates.”

          The 2017/18 flu season is NOT COVID-19 so why would anyone bother to provide this link? Maybe Brucie boy thinks he has a point here but our resident village idiot was incapable of telling us WTF his point was.

          Come on Bruce – tell Kelly Ann to be more clear with your marching orders.

        2. 2slugbaits

          Bruce Hall I’m not sure what your point is. Are you saying that lockdowns during May were a bad idea? That’s seems like a silly argument. By the beginning of June every state had relaxed the most stringent of its restrictions. Given that it takes about a month before a change in policy shows up as a change in death rates, lets look at what happened from 1 July through the end of September, keeping in mind that we still don’t have a good read on the total number of deaths for October. It turns out that of the 25 states with the lowest deaths per capital between 1 July through 30 Sep, 19 of those states are run by Democratic governors and 6 are run by Republican governors. Of the 25 states with the highest deaths per capita, only 8 are run by Democratic governors and 17 are run by Republican governors. Coincidence? That seems like pretty clear evidence that once states got on top of the initial wave of infections and deaths the states that kept and enforced relatively mild restrictions did a better job of managing the pandemic.

          most of the deaths are among those in age groups not working

          Do you have some magical way of isolating those age groups? If the elderly are in nursing homes, then they have to come in contact with workers, and those workers typically come from high risk demographic groups. If the elderly live with their children, then they also come in contact with kids and people of working age. You really need to think these things through.

          the states with the most onerous economic policies

          Exactly which states have “onerous economic policies”? All of the severe lockdowns lapsed in late May. Do you consider mask wearing in public an onerous policy? Not being able to get drunk at a bar? Not being able to attend superspread MAGA rallies? There are no “onerous economic policies” right now. It’s like you’re frozen in time the same way conservatives always believe that it’s 1979 and 12% inflation.

          Did any of your friends or family members get rounded up in the FBI sting of those white supremacists in Michigan?

        3. SecondLook

          Your connection between the statistics and the political identites is the failed causation.
          You are aware of that.
          Simplest example: Nevada’s high rate of unemployment is not due to the policies of the Governor, but rather the nationwide, collapse of tourism and business conventions devastating the travel and hotel industries.
          Facts that you know, but chose to ignore. Then, when the choice comes between faith and facts, faith has the heavy emotional artillery.
          Quite understandable.

          Stay safe now.

          1. noneconomist

            Nine of the top ten college football teams in the AP poll are in states with Republican governors.
            Tampa Bay is home of the American League pennant winner and Tom Brady whose team beat Green Bay, a team from a state with a Democratic governor (whose QB, BTW, was born and raised in California and we all know what that means).
            Florida State, with the backing of brilliant governor De Santis, yesterday defeated North Carolina, whose Democratic governor wouldn’t allow the Republicans to hold their convention in his state and who is personally attempting to use mail-in voting to tilt the election.
            Speaking of unAmerican states, tonight’s NLCS game 7 pits a team from a southern state with voting lines a mile long–like God intended–against one from a dystopian socialist hell hole, whose governor encourages vote by mail and who also refuses to rake any of the state’s 18 national forests.
            You want proof? You turn to the sports world for answers. Right Bruce?

      2. pgl

        FYI. Bruce’s sole source of income is from Kelly Anne Conway. His sole task is to copy and paste her emails all full of Alternative Facts.

      3. pgl

        Single statistic Bruce Hall must think being unemployment means one has COVID-19. After all he does not show the most important statistic – the daily death rate per capita. Wonder why.

    2. 2slugbaits

      Of the thirteen states with the lowest GDP per capita, ten of them have Republican governors. Of course, that’s just a coincidence.

      Of the thirteen states with the highest GDP per capita, eight of them have Democratic governors; but two of the five Republican governors you would call RINOs in the bluest of blue states (Massachusetts and Maryland). Of course, that’s just a coincidence.

      1. pgl

        May not a coincidence but reverse causation. High incomes lead to more funding for education which leads to smarter voters electing Democratic leaders. Those GOP states are not only poorer but given the incredible stupidity that emanates from them is a sign of stupidity. Not that this is caused by Republican leaders per se but anyone who votes for a Trumpian Republican is clearly very dumb.

    3. pgl

      Our village idiot thinks he came up with some great analysis. Of course our village idiot does not know the difference between unemployment and the employment to population ratio. One can have a lower unemployment rate simply because the labor force participation rate is lower. So maybe what Single Statistic Bruce no relationship to Robert Hall has discovered is that Republican governors cause people to drop out of the labor force so they can mooch on the Federal funds we Blue States provide to the Federal government.

    4. pgl

      “Governing policies during the epidemic couldn’t have anything to do with that.”

      Check out your little list of the states that you THINK have good governing policies. A lot of them are mid-Atlantic and Northeast who are all coordinating their policies with what NY and Governor Cuomo is doing. California is on your list and they too are refusing to follow the bat shit nonsense you keep advocating.

      Yes – good policies to do just the opposite of what our village idiot Bruce Hall advocates!

    5. Barkley Rosser


      So i just looked at the list of the top 13 states in new covid-10 cases per capita as of three days ago. Here they are in order.

      North Dakota, Louisiana, Mississippi, South Dakota, Florida, Alabama, Iowa, Tennessee, Arkansas, Georgia, Arizona, South Carolina, Rexas. Of these six are in those states you list as having the lowest unemployment rates while zero are in that list of those with the highest unemployment rates. Guess whose economies are likely to be doing better and whose are likely to be doing worse over the next several months?

    6. Willie

      And the unemployment rate in red states will be lower soon. Why? Dead people don’t need jobs. The death cult in power in those states seems determined to repeat every mistake the states that were hit early made and make some more mistakes besides. Not to mention size demographics and all that.

      But… hey look! A squirrel!

  14. pgl

    Can we schedule a debate between bimbo Lara Trump and Kevin Drum on how poorly Trump has been doing on the coronavirus issue? Yes this bimbo was on the air defending chats to lock up the governor of Michigan and saying we are “turning the corner” on this virus. That is what bimbos do. But what was her evidence that we are doing better than other nations. Deaths per capita for the big US v. the smaller Canada? OK – good metric but Kevin Drum presents the facts on a daily basis:

    Canada has had 257 deaths per million v. the US with 667 deaths per million. Does Ms. Bimbo really think 667 is less than 257?

    Now she did say daily deaths are rapidly falling but check out Kevin’s graphs. Any decline in daily deaths for the US has been very small. Maybe Ms. Bimbo was talking up daily deaths in Canada.

  15. pgl

    Let me get this straight. Even as Trump’s minions are restricting voter ballot drop boxes in large cities, they are placing unauthorized drop boxes like places like gun shops. Look I have no problem with authorized drop boxes in gun shops as long as we can have more drop boxes in places like NBA arenas and Baptist Churches.

    Oh wait – a lot of NBA fans are black and those Baptist Churches in the south in black neighborhoods draw a lot of worshipers. Gotta get out the redneck vote and suppress like crazy black voters. After all – this is the MAGA way.

  16. pgl

    Our host put this up a few days ago:

    A big take away is that the Asian nations who did early lock downs and got this virus under control quickly with smart test and trace policies did not see negative expected GDP growth for 2020 and are expected to see higher growth in 2021 than the US or many of the European nations.

    I guess Kelly Anne Conway ordered Bruce Hall not to read this post given his latest stupid comment about which party a governor was in v. the state unemployment rate. That is how Kelly Ann likes her slaves – uninformed and very stupid.

  17. pgl

    If one is truly interested in the employment situation for any state, BLS provides links like this one that show employment to population as well as labor force participation rates (unemployment rates are essentially the difference):

    I picked Maryland because even though it has a Republican governor, they are following basically NY style policies.

    Now since Bruce Hall is too stupid to do anything but look at the unemployment rate, let us make this easy for him. This state saw unemployment jump to 10% but it has declined to 6.9% as of August. So congrats to its Republican governor for working with Cuomo and ignoring dangerous idiots like Bruce Hall.

  18. pgl

    Trump says we have turned the corner on this virus. Isn’t that go around the bend? Biden just did that and the audience went crazy honking their horns. Bumper sticker material!

  19. ltr

    October 12, 2020

    The COVID-19 Pandemic and the $16 Trillion Virus
    By David M. Cutler and Lawrence H. Summers

    The SARS-CoV-2 (severe acute respiratory syndrome coronavirus 2) pandemic is the greatest threat to prosperity and well-being the US has encountered since the Great Depression. This Viewpoint aggregates mortality, morbidity, mental health conditions, and direct economic losses to estimate the total cost of the pandemic in the US on the optimistic assumption that it will be substantially contained by the fall of 2021. These costs far exceed those associated with conventional recessions and the Iraq War, and are similar to those associated with global climate change. However, increased investment in testing and contact tracing could have economic benefits that are at least 30 times greater than the estimated costs of the investment in these approaches.

    Since the onset of coronavirus disease 2019 (COVID-19) in March, 60 million claims have been filed for unemployment insurance. Before COVID-19, the greatest number of weekly new unemployment insurance claims (based on data from 1967 on) was 695 000 in the week of October 2, 1982. For 20 weeks beginning in late March 2020, new unemployment claims exceeded 1 million per week; as of September 20, new claims have been just below that amount.

    Recessions feed on themselves. Workers not at work have less to spend, and thus subsequent business revenue declines. The federal government offset much of the initial loss owing to the shutdown, which has averted what would likely have been a new Great Depression. But the virus is ongoing, and thus full recovery is not expected until well into the future. The Congressional Budget Office projects a total of $7.6 trillion in lost output during the next decade.

    Lower output is not the only economic cost of COVID-19; death and reduced quality of life also can be measured in economic terms….

  20. ltr

    October 13, 2020

    Download National and State-by-State Data
    By Steve Wamhoff

    If the Supreme Court strikes down the Affordable Care Act (ACA), as argued for by the Trump administration and the president’s nominee to the court, Amy Coney Barrett, one under–appreciated result will be a tax break of roughly $40 billion annually for about 3 percent of Americans, who all have incomes of more than $200,000. 

  21. ltr

    October 13, 2020

    Supreme Court Would Provide Massive Tax Cut for the Rich if It Strikes Down Affordable Care Act
    By Steve Wamhoff

    If the Supreme Court strikes down the Affordable Care Act (ACA), as argued for by the Trump administration and the president’s nominee to the court, Amy Coney Barrett, one under–appreciated result will be a tax break of roughly $40 billion annually for about 3 percent of Americans, who all have incomes of more than $200,000.

    As illustrated in the table below, the IRS’s most recent data show that 3.3 percent of tax filers paid more than $30 billion cumulatively in net investment income tax (NIIT) in 2018, while 2.8 percent of filers paid more than $9 billion in additional Medicare tax, which is a supplemental payroll tax on high-earners. Striking down the entire ACA in its entirety would nullify both taxes.

    [ ]

    The share of taxpayers in each state paying the NIIT varied from a low of 1.4 percent in West Virginia to a high of 5.4 percent in Massachusetts (or 7.1 percent in Washington, DC, if it is counted as a state).

    The share of taxpayers in each state paying the additional Medicare tax varied from a low of 1 percent in Mississippi to a high of 5.2 percent in New Jersey (7.1 percent in Washington, DC)….

  22. ltr

    October 17, 2020



    Cases ( 8,342,665)
    Deaths ( 224,282)


    Cases ( 7,492,727)
    Deaths ( 114,064)


    Cases ( 841,661)
    Deaths ( 85,704)


    Cases ( 867,197)
    Deaths ( 33,392)


    Cases ( 705,428)
    Deaths ( 43,579)


    Cases ( 361,733)
    Deaths ( 9,853)


    Cases ( 196,321)
    Deaths ( 9,746)


    Cases ( 85,659)
    Deaths ( 4,634)

  23. ltr

    October 17, 2020

    Coronavirus (Deaths per million)

    US ( 676)
    Mexico ( 663)
    UK ( 641)
    France ( 511)

    Canada ( 258)
    Germany ( 117)
    India ( 82)
    China ( 3)

    Notice the ratios of deaths to coronavirus cases are 10.2%, 6.2% and 3.9% for Mexico, the United Kingdom and France respectively. These ratios are high, but have been significantly higher, while falling recently.

  24. ltr

    October 18, 2020

    Chinese mainland reports 13 new COVID-19 cases

    The Chinese mainland on Saturday registered 13 new COVID-19 cases, all from overseas, the National Health Commission announced on Sunday.

    No deaths related to the disease were reported on Saturday, and 20 COVID-19 patients were discharged from hospitals, the commission said. A total of 389 asymptomatic patients remain under medical observation.

    The COVID-19 tally on the Chinese mainland stands at 85,672, with 4,634 fatalities.

    Chinese mainland new imported cases

    Chinese mainland new asymptomatic cases

    [ There has been no coronavirus death on the Chinese mainland since May 17. Since June began there have been 3 limited community clusters of infections, in Beijing, Dalian and Urumqi, each of which was contained with mass testing, contact tracing and quarantine, with each outbreak ending in a few weeks.

    Currently there is another limited community cluster in Qingdao, with mass testing, contact tracing and quarantine again being used to identify the origin of as well as to contain and end the outbreak.

    Imported coronavirus cases are caught at entry points with required testing and immediate quarantine. Asymptomatic cases are all quarantined. The flow of imported cases to China is low, but has been persistent.

    There are now 252 active coronavirus cases in all on the Chinese mainland, 5 of which cases are classed as serious or critical. ]

  25. Moses Herzog

    I swiped this verbatim off the 538 site. Written by Maya Sweebler, and they have other interesting things there related to the elections. One might ask themselves if fraudster and vote suppressor Gregg Abbott down in Texas would have interfered in public elections if a Republican was leading in Presidential polls. Or if White House Officials would be using vote suppressing lawsuits and Republican guided courts (thanks to Nancy Pelosi’s 30-year lunch break for ice cream) to influence the 2020 election.
    6:09 PM
    Answering Reader Questions On Deadlines For Law Changes, Oct. 16

    “Iain from the United Kingdom: As a Brit, I find it just bizarre that so many changes can be made by the state court system so close to an election. In the U.K., we have the electoral commission and they have to close on the “rules” a chunk of time ahead of the election. Is there an equivalent in the U.S., or are the individual states and governors still able to change the rules right up to the election? (This reader question has been edited and condensed for clarity.)

    The short answer is no, there is no federal law or commission that sets a date by which all states must finalize their election procedures.

    The long answer is one of FiveThirtyEight’s favorites: It’s complicated. While there are no firm guidelines for states, there is a legal principle, known as the Purcell principle, that says courts ought to avoid issuing orders that change election rules right before an election in order to avoid confusing voters and creating logistical challenges for election officials. Of course, that’s pretty vague! And not all courts will necessarily interpret this principle in the same way.

    But we’ve already seen the Supreme Court and some lower courts invoke the Purcell principle this year. For instance, the day before Wisconsin’s April 7 primary, the Supreme Court struck down a district court ruling extending the deadline by which absentee ballots could arrive, stating “that lower federal courts should ordinarily not alter the election rules on the eve of an election.” And earlier this week, the 7th Circuit Court of Appeals reversed a district judge’s order that Indiana count absentee ballots that arrive through Nov. 13.

    So while there’s no formal cutoff for changes, it’s fair to say that courts have been hesitant to affirm decisions that lead to major rule changes close to elections. This will certainly not be universally true — just this month, a Virginia judge said the state had to extend its voter registration deadline after its online portal crashed on the day of the initial deadline — but it is definitely something to keep in mind as the Supreme Court prepares to weigh in on cases from Alabama, Pennsylvania, Wisconsin and perhaps Texas.”

    1. Moses Herzog

      Translation of the Maya Sweebler response: If Democrat voters need more time for their mail-in ballots to count in an election because of a virus pandemic—then the rules will NOT be changed and “Democrats can go F*** themselves.” If all voters in any Texas county composed of 80%+ Democrats have to drive 30+ miles to the one single mandated ballot box in that county to vote, then the voting rules WILL be changed, and “Democrats can all go F*** themselves.”

      That’s your lesson in American Civics and “conservative” courts for today kids. But don’t interrupt Nancy Pelosi’s 30-year ice cream break because some people on this blog “really admire her intelligence”.

  26. Moses Herzog

    Does anyone know why ZH is posting Morgan Stanley forecasts late afternoon on a Sunday that were made public over a MONTH ago?? Is that ZH policy now??~~~to post up month-old ago forecasts??

    On a loosely related query, does anyone know if Chetan “V recovery” Ahya uses as much cocaine as Larry Kudlow in his heyday??

  27. pgl

    Scott Atlas needs to go:

    Report: Birx Confronted Pence About Atlas And Pushed For His Removal From COVID Task Force

    White House COVID-19 response coordinator Dr. Deborah Birx reportedly told Vice President Mike Pence recently that Dr. Scott Atlas, who peddles anti-science talking points about the virus that bolster President Donald Trump’s attempts at PR amid his botched handling of the pandemic, needs to go.
    The Washington Post reported on Monday that Birx has told Pence she does not trust Atlas, who has falsely claimed masks are ineffective against COVID-19 and pushed a herd immunity approach to the virus that scientists say would be disastrous. Additionally, Atlas does not have a background in epidemiology.
    He has reportedly clashed with Birx, Dr. Anthony Fauci, Centers for Disease Control and Prevention (CDC) Director Robert Redfield, and Food and Drug Administration (FDA) Commissioner Stephen Hahn, repeatedly over their science-based analysis and pushes for increased testing.
    According to the Post, Atlas has persistently rejected Birx and Fauci’s urgent calls to make testing widely available. Instead, he has been reportedly asserting that testing ought to be limited to populations who are most vulnerable to COVID-19 without including young and healthy people.
    The Trump administration has worked to tamp down on testing, fearing how the dire COVID-19 infection rates in the U.S. could hurt the President politically ahead of the November elections. Trump has repeatedly blamed the case numbers on testing, despite the fact that it does not account for the nearly 220,000 Americans who have died from the virus.
    Birx and Fauci also had what the Post described as a “fierce debate” with Atlas last month over his assertion that schools ought to be reopened (another pro-Trump proposal) because, according to Atlas, the U.S. has largely reached a herd immunity due to the country’s high caseloads.
    One of Atlas’ false statements about COVID-19 led to Twitter removing his tweet claiming that masks don’t work against the virus, a violation of Twitter’s rules against misinformation.

  28. pgl

    Some reassuring news on the issue of FDA approval for any potential vaccine:

    Dr. Anthony Fauci, the nation’s top infectious disease official, will oversee most of the ongoing COVID-19 vaccine trials in the U.S., but not that of the current front-runner made by Pfizer, documents obtained by ProPublica show … According to a draft charter spelling out how most of the advanced COVID-19 vaccine trials will be monitored, Fauci is the “designated senior representative” of the U.S. government who will be part of the first look at the results. That puts Fauci in the room with the companies — including Moderna, Johnson & Johnson and AstraZeneca — in deciding whether the vaccines are ready to seek approval from the Food and Drug Administration…Fauci doesn’t have the same hands-on role for the vaccine that seems poised to show results soonest: Pfizer’s. That’s because Pfizer opted not to accept government funding and participate in the federal program to develop a coronavirus vaccine, known as Operation Warp Speed…Pfizer’s CEO, Albert Bourla, said Friday that the earliest his company would be ready to apply for authorization would be the third week of November. While Pfizer might know by the end of October if its vaccine is effective, it would need additional time to gather sufficient safety data to present to the FDA, Bourla said in an open letter on the company’s website. Fauci’s role in overseeing the companies that are participating in Operation Warp Speed arises from a unique arrangement that the government set up to monitor the trials. Typically, clinical trials set up their own independent panels of scientists, known as a data safety monitoring board or DSMB, to watch out for safety concerns or early signs of success. But all of the vaccine trials in Operation Warp Speed are sharing a common DSMB whose members were selected by Fauci’s agency, the NIAID. They’re also sharing a network of clinical trial sites where some volunteers are recruited for the studies.

  29. AS

    Professor Chinn,
    I am not aware of differences between how California and Wisconsin are dealing with shutdowns, but it looks like Wisconsin’s nonfarm job recovery is close to that for the US, while California lags behind. Using February of 2020 as the peak of nonfarm employment, both WI and US as of September 2020 seem to be about 7.4% and 7.3% respectively below February 2020 employment levels using logs. California seems to be about 10% below for the comparable period. I had to estimate California September non farm employment. Seasonally adjusted data are not presented on the CA EDD website and are not posted at FRED yet.
    I appreciate your demonstration of the use of the EViews function @elem in your lecture notes. Sure helps to normalize data.

    1. Barkley Rosser


      Probably more likely to get a response from Menzie, who specializes in international finance. While Jim has published some important papers in that area it is not his main specialty, which has long been on energy, especially oil., and the economy. They are both strong time-series macroeconometricians, but Menzie is the one more into international finance.

      1. Moses Herzog

        Barkley Junior
        Hamilton posted a paper related to “Libra” not terribly long ago. I think most likely they have equal interest that article and paper, especially since the value of currencies is often related to oil—hence the creation of terms like “petrodollar”. You might find Junior, that for professors who are actually on the ball and not obsessed with gazing at their own navel revolutionary changes in the way society conducts changes would rank as notable and worth following closely to them—not that you would empathize with that latter sentiment.

        On a side note Junior, do you often find yourself walking up to strangers telling them that Reese’s Peanut Butter Cups are filled with peanut butter on the inside when they comment that the chocolate on the outside tasted great??

        1. Barkley Rosser

          No, Moses, I do not. I also do not dementedly attack Nancy Pelosi over ice cream because somehow she has not gotten the Congress to change the US judicial system when she does not control the US Senate, much less the White House.

          You are right that Jim did post on Libra in June, 2019. He said it would be interesting to see how it would work out. Well, it has not. It has gone a big nowhere. I posted on Econospeak and Angry Bear at the time, pointing out that it had a lot of problems, all of which turned out to be important.

          As it is, Menzie has written on the euro as an alternative to the dollar as the world’s leading currency, which would be relevant here. So in fact I stick with it being more likely he would comment on this than Jim.

          I would also suggest, Moses, that after you got on his case for speaking at the Hoover Institutioni, Jim is not going to be jumping to attention when you suggest he ought to comment on something you link to here by saying that he should do so out of “diligence.”

          So, did you switch from Pinot Noir to gallons of bad bourbon?

          1. Moses Herzog

            @ Barkley Junior
            You also said in that same thread you never visited the Quora site (one of your many lies), after you used it as a reference for your unsubstantiated, and indeed FALSE claim that Native American admixture in European (“white”) Americans was “skewed” over the entire population, which a lot of visual data presented in that paper (which you were afraid to link to after you got called out for lying about its contents) and pure common sense after hundreds of years of intermingling in North America and X number of generations would tell someone.

            Whether Professor Hamilton chooses to read the article and associated paper on my recommendation is his personal choice. I suspect Prof Hamilton has/had already read the paper, and mentioned it as a courtesy to Professor Hamilton as he has already shown an interest in the Libra, and since it was very recently published, there was a small chance he might not have read it. I didn’t make the comment to garner attention like some sad old man in Harrisonburg does. I mentioned it to be polite and as a tip of the hat that I had enjoyed his thoughts on the Libra.

            It takes a lot of arrogance on your part to assume either of the two men would take more or less interest on it, your gargantuan and never governed ego also now has you as magical mindreader of two profs with a waaaaaaay better mind than your own, never mind their edge on you in personal demeanor.

          2. Barkley Rosser

            Wow, Moses, you are completely losing it here. How much bourbon have you been guzzling down?

            I am nor even sure where to start with this lunacy and probably should not waste my time, but I guess I shall reply.

            You are lying as badly as Donald Trump when you claim that I ever said I “never visited Quora.” Heck, Mose, I visited it once where I picked up the article that you have bizarrely again mentioned, dragging up for the umpteenth time an irrelevant matter on which you have done nothing but make an utter and total fool of yourself here repeatedly, this matter of skewed distributions of Native American ancestry among European-Americans, a matter the details which I am not going to revisit the details of for the umpteenth time other than to note that you have been told by a fairly substantial number of people here that you were and are completely wrong about it with nobody defending you, not CoRev or even Macroduck., your occasional defenders. Not only are you bringing up something that makes you look like a drooling moron, but you are now adding a lie to it.

            For the record, I do not spend time at all at Quora, although I did get that one article there, finding its link by googling on the specific topic. I do not have strong feelings about it, but after you denounced it I checked out what others say, and the bottom line remains that it is a mixed bag, with some good stuff and some not so good stuff, it all depending on who is writing. That particular story happened to be accurate, and nothing you have said about it has undone anything in it, so you have taken to attacking it for where it appeared, a pretty pathetic way to go, but all you have.

            I would remind you, Moses, that you are the one that assumed an impolite air in your suggestion to Jim H. that he look at this article and comment on it, especially given how infrequently he comments here, indeed almost never does unless it is in reply to comments made on a thread he has started, which this thread is not. Again, dragging in “diligence” in your request looked like a subtle attempt at a guilt trip, which, again, was pretty inappropriate coming from you who took him to task for appearing at the Hoover Institution.

            I see no point in arguing about who is smarter than whom in all this. Both Jim and Menzie are much more capable time series macroeconometricians than I am and also in the field of international finance, although I have published a number of papers in both those areas, not among my more highly cited.

            However, I do sometimes hold my own with them. In particular I have been right in a couple of public debates with Jim. One was over whether or not we were having a housing bubble back in the middle of the first decade of the 2000s. I was one of the very early people to call that. Jim was long a holdout defending the idea that housing markets back then were not in a bubble and would later agree that he held that view for too long. More recently on this matter of the Libra proposal, which you somehow thought I had nothing to say about, I think I came out more on top of what was going to happen than Jim did, although his comments were, as always, very thoughtful and insightful..

            Actually, regarding Menzie, I am not remembering us having any major disagreements, although I think we have each corrected the other on relatively minor items of fact from time to time, and I have not kept track at all who has accurately corrected whom more often.

            Oh, and just because I have occasionally done well in debating with Jim, who only infrequently posts here these days, it needs to be recognized how brilliant he is in his particular area. His grad textbook on Time Series Analysis is essentially a bible, widely viewed as effectively definitive on a wide range of topics in that area. And while I know you sort of sneer at citation rates, Jim does indeed have more citations than three out of four of the people who either got the most recent Sveriges Rksbank prize or were their frequent coauthors in the “Gang of Four” and candidates to join them. He really is professionally outstanding and also busy, all the more reason not to bother him with trivial requests put forward arrogantly as you did, Moses.

      2. Moses Herzog

        I should correct myself again, it was not a paper on Libra that Prof Hamilton wrote, but an extended (in a good way) blog post. I thought it was one of his better posts from a fascination standpoint and as a cerebral delight.

        1. Barkley Rosser

          It was a thoughtful post by Jim H. But it was way too positive about the prospects for Libra. I more accurately pointed out likely reasons it would go nowhere, which is what has happened.

          Of course, Moses, you are right that I am simply “not on the ball… with the revolutionary changes in the way that society conducts changes.” I may have done a better job of calling what would happen with Libra than did Jim H., but, heck, I am not on the ball. Maybe I am on the hypersphere instead.

          1. Barkley Rosser

            Of course, being right about something and pointing it out is being hyper-constipated, Moses.

            As for what you linked to, it is behind a firewall for me, but I suspect neither Jim nor Menzie will bother commenting on it. We recently had a thread here on the dollar possibly being replaced in the near future. Indeed, it was decided that the euro was the only serious alternative to the USD, a position I think Menzie agreed with (Jim did not participoate)., but it was also generally viewed as not too likely anytime soon.

            As for a digital version of the euro? Probably will not change that estimation very much, another overhyped story probably.

            Happy now to get some comment on this, Moses?

          2. Barkley Rosser

            Oh, I see we have recently had an uptick in bitcoin prices. Maybe this is being triggered by this euro digital currency talk. That would be some effect if it is the case.

  30. ltr

    October 20, 2020

    Excess Deaths Associated with COVID-19, by Age and Race and Ethnicity — United States, January 26–October 3, 2020
    By Lauren M. Rossen, Amy M. Branum, Farida B. Ahmad, Paul Sutton and Robert N. Anderson

    What is already known about this topic?

    As of October 15, 216,025 deaths from COVID-19 have been reported in the United States; however, this might underestimate the total impact of the pandemic on mortality.

    What is added by this report?

    Overall, an estimated 299,028 excess deaths occurred from late January through October 3, 2020, with 198,081 (66%) excess deaths attributed to COVID-19. The largest percentage increases were seen among adults aged 25–44 years and among Hispanic or Latino persons.

    What are the implications for public health practice?

    These results inform efforts to prevent mortality directly or indirectly associated with the COVID-19 pandemic, such as efforts to minimize disruptions to health care.

  31. ltr

    October 19, 2020



    Cases ( 8,456,653)
    Deaths ( 225,222)


    Cases ( 7,594,736)
    Deaths ( 115,236)


    Cases ( 910,277)
    Deaths ( 33,623)


    Cases ( 851,227)
    Deaths ( 86,167)


    Cases ( 741,212)
    Deaths ( 43,726)


    Cases ( 373,731)
    Deaths ( 9,899)


    Cases ( 201,437)
    Deaths ( 9,778)


    Cases ( 85,685)
    Deaths ( 4,634)

  32. ltr

    October 19, 2020

    Coronavirus (Deaths per million)

    US ( 679)
    Mexico ( 666)
    UK ( 643)
    France ( 515)

    Canada ( 258)
    Germany ( 118)
    India ( 83)
    China ( 3)

    Notice the ratios of deaths to coronavirus cases are 10.1%, 5.9% and 3.7% for Mexico, the United Kingdom and France respectively. These ratios are high, but have been significantly higher, while falling recently.

  33. ltr

    October 20, 2020

    Chinese mainland reports 19 new COVID-19 cases

    The Chinese mainland on Monday registered 19 new COVID-19 cases, all from overseas, the National Health Commission announced on Tuesday.

    No deaths related to the disease were reported on Monday, and 10 COVID-19 patients were discharged from hospitals, the commission said. A total of 403 asymptomatic patients remain under medical observation.

    The COVID-19 tally on the Chinese mainland stands at 85,704 infections, with 4,634 fatalities.

    Chinese mainland new imported cases

    Chinese mainland new asymptomatic cases

    [ There has been no coronavirus death on the Chinese mainland since May 17. Since June began there have been 3 limited community clusters of infections, in Beijing, Dalian and Urumqi, each of which was contained with mass testing, contact tracing and quarantine, with each outbreak ending in a few weeks.

    Currently there is another apparently limited community cluster in Qingdao, with mass testing, contact tracing and quarantine again being used to identify the origin of as well as to contain and end the outbreak.

    Imported coronavirus cases are caught at entry points with required testing and immediate quarantine. Asymptomatic cases are all quarantined. The flow of imported cases to China is low, but has been persistent.

    There are now 258 active coronavirus cases in all on the Chinese mainland, 4 of which cases are classed as serious or critical. ]

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