Inflation Adjusted Wages since the Pandemic

Inflation exceeds average hourly earnings in the aggregate (private sector) and for Leisure and Hospitality Services (production and nonsupervisory). But they are still ahead of 2020M02 levels.

Figure 1: Average hourly earnings in private nonfarm payroll (blue, left log scale), and in leisure and hospitality services (brown, right log scale), both in 2020$/hour. 2022M04 real wage uses Cleveland Fed CPI nowcast (5/6). Source: BLS via FRED, Cleveland Fed, and author’s calculations.

Note that Cleveland Fed April CPI nowcast is 0.28% m/m, compared to Bloomberg consensus 0.2%. If Wednesday’s release exceeds 0.28%, then real average hourly earnings might decline again.

While both real wage series are higher than pre-2020M03 (not holding composition constant), it’s interesting to note that leisure and hospitality services earnings are above 2016-19 trend.

Figure 2: Average hourly earnings in leisure and hospitality services (brown) and 2016-19 stochastic trend (light blue), both in 2020$/hour. 2022M04 real wage uses Cleveland Fed CPI nowcast (5/6). Source: BLS via FRED, Cleveland Fed, and author’s calculations.

A caveat: My comparison is pre- vs. during pandemic, and using the CPI as a representative cost-of-living indicator. As noted by Rampell/WaPo, over the past year (2020Q4-2021Q4), the cost-of-living for low income households has risen more than for high income households. That’s consistent with the fact that the CPI is a plutocratic index, representing consumption weights for households at about the 75th percentile. Using a CPI calibrated to say the 20th percentile might change results noticeably.

 

91 thoughts on “Inflation Adjusted Wages since the Pandemic

  1. pgl

    “While both real wage series are higher than pre-2020M03 (not holding composition constant), it’s interesting to note that leisure and hospitality services earnings are above 2016-19 trend.”

    Not saying the Econ 101 perfectly competitive labor demand = labor supply model explains all labor economics as it certainly does not but …

    We had a massive inward shift of the labor supply curve in early 2020 with a gradual outward shift as we start to get this virus until a little bit of control over it, which would explain both the early increase in real wages followed by their downward drift after real wages peaked.

    Reply
    1. AndrewG

      “We had a massive inward shift of the labor supply curve ”

      It was a sharp fall in demand (movie theaters, restaurants, etc. being shut down, and people just choosing not to go), not a shift in supply. Wages went go up on average because those who lost their jobs tended to be the lowest earners (cash register, busboys, etc.).

      We don’t need to believe in perfectly competitive markets to learn from Marshall’s supply and demand graphs!

      Reply
  2. ltr

    https://fred.stlouisfed.org/graph/?g=lMaW

    January 15, 2018

    Real Median Weekly Earnings for men and women, * 2000-2022

    * Full time wage and salary workers

    (Percent change)

    https://fred.stlouisfed.org/graph/?g=lMaX

    January 15, 2018

    Real Median Weekly Earnings for men and women, * 2000-2022

    * Full time wage and salary workers

    (Indexed to 2000)

    https://fred.stlouisfed.org/graph/?g=muJR

    January 15, 2018

    Real Median Weekly Earnings for White, Black and Hispanic, * 2001-2022

    * Full time wage and salary workers

    (Percent change)

    https://fred.stlouisfed.org/graph/?g=muKc

    January 15, 2018

    Real Median Weekly Earnings for White, Black and Hispanic, * 2001-2022

    * Full time wage and salary workers

    (Indexed to 2001)

    Reply
  3. ltr

    https://news.cgtn.com/news/2022-05-09/China-s-foreign-trade-up-7-9-in-first-four-months-in-2022-19TaKu5Cxj2/index.html

    May 9, 2022

    China’s foreign trade up 7.9% in first four months despite headwinds

    The total value of China’s imports and exports rose by 7.9 percent year on year in the first four months of 2022 despite growing headwinds in foreign trade, official data showed on Monday.

    Foreign trade value reached 12.58 trillion yuan ($1.88 trillion) during the period, with exports jumping 10.3 percent from the same period last year to 6.97 trillion yuan and imports growing by 5 percent to 5.61 trillion yuan, according to the General Administration of Customs (GAC).

    China’s goal of maintaining stability and improving foreign trade throughout the year is still well supported, GAC spokesperson Li Kuiwen said.

    Association of Southeast Asian Nations (ASEAN) remains China’s largest trading partner, making up 14.6 percent of China’s total foreign trade.

    China’s imports and exports to ASEAN, the European Union and the United States were 1.84 trillion yuan, 1.73 trillion yuan and 1.56 trillion yuan, up 7.2 percent, 6.8 percent and 8.7 percent year on year, respectively.

    During the same period, the total imports and exports between China and the countries along the Belt and Road increased by 15.4 percent…

    Reply
  4. AndrewG

    Prof. Chinn, I went back to your post “CPI is a plutocratic index” (linked above, last paragraph) and very much appreciated the read. William Stanley Jevons lives! I recommend it to other readers.

    Reply
    1. pgl

      Love this quote:

      In the democratic index, the expenditure pattern of each household counts in equal measure in determining the population index; in essence, it is a case of “one household–one vote”. In the plutocratic case, the contribution of each household’s expenditure pattern is positively related to the total expenditure of that household relative to other households–in essence, “one dollar, one vote”.

      Reply
  5. pgl

    Love this quote:

    In the democratic index, the expenditure pattern of each household counts in equal measure in determining the population index; in essence, it is a case of “one household–one vote”. In the plutocratic case, the contribution of each household’s expenditure pattern is positively related to the total expenditure of that household relative to other households–in essence, “one dollar, one vote”.

    Reply
  6. pgl

    My comparison is pre- vs. during pandemic, and using the CPI as a representative cost-of-living indicator. As noted by Rampell/WaPo, over the past year (2020Q4-2021Q4), the cost-of-living for low income households has risen more than for high income households. That’s consistent with the fact that the CPI is a plutocratic index, representing consumption weights for households at about the 75th percentile. Using a CPI calibrated to say the 20th percentile might change results noticeably.

    Or just show rsm understands this – the difference between the upper quartile v. the lower quintile.

    Reply
  7. macroduck

    If we look at real total compensation, rather than just wages, the picture is similar. Real total compensation is above its pre-recession oevel and above the pre-recession trend. trend. The trend has been flat since the end of the recession and the Q1 reading fell as ye result of inflation. I is loss gains in real compensation will evaporate in coming quarters.

    Reply
    1. AndrewG

      That’s a cool one. Nice using reputed high-performing companies to train the model to find other high-performing companies when it came to worker placement. Lots of problems, sure, but a reasonable solution. I’d have to take a closer look at their attempts to gauge robustness.

      Anyway, nice share.

      Reply
    1. macroduck

      One result of Russia’s renewed adventurism in Ukraine has been concern that China might be emboldened to attack TaIwan. The U.S. has made clear it is ready to support Taiwan. The U.S. and Taiwan are negotiating a deal to provide Taiwan weapons better suited to confront China’s current weaponry.

      As of May 3, the State Department description of the U.S. view of relations with Taiwan relative to China began like this:

      The United States and Taiwan enjoy a robust unofficial relationship. The 1979 U.S.-P.R.C. Joint Communique switched diplomatic recognition from Taipei to Beijing. In the Joint Communique, the United States recognized the Government of the People’s Republic of China as the sole legal government of China, acknowledging the Chinese position that there is but one China and Taiwan is part of China. The Joint Communique also stated that the people of the United States will maintain cultural, commercial, and other unofficial relations with the people of Taiwan. The American Institute in Taiwan (AIT) is responsible for implementing U.S. policy toward Taiwan.

      The United States does not support Taiwan independence. Maintaining strong, unofficial relations with Taiwan is a major U.S. goal, in line with the U.S. desire to further peace and stability in Asia. The 1979 Taiwan Relations Act provides the legal basis for the unofficial relationship between the United States and Taiwan, and enshrines the U.S. commitment to assist Taiwan in maintaining its defensive capability. The United States insists on the peaceful resolution of cross-Strait differences, opposes unilateral changes to the status quo by either side, and encourages both sides to continue their constructive dialogue on the basis of dignity and respect.

      On May 5, it changed to this:

      As a leading democracy and a technological powerhouse, Taiwan is a key U.S. partner in the Indo-Pacific. The United States and Taiwan share similar values, deep commercial and economic links, and strong people-to-people ties, which form the bedrock of our friendship and serve as the impetus for expanding U.S. engagement with Taiwan. Through the American Institute in Taiwan (AIT), a non-governmental organization mandated by the Taiwan Relations Act to carry out the United States’ unofficial relations with Taiwan, our cooperation with Taiwan continues to expand. Taiwan has become an important U.S. partner in trade and investment, health, semiconductor and other critical supply chains, investment screening, science and technology, education, and advancing democratic values.

      The United States has a longstanding one China policy, which is guided by the Taiwan Relations Act, the three U.S.-China Joint Communiques, and the Six Assurances. Though the United States does not have diplomatic relations with Taiwan, we have a robust unofficial relationship as well as an abiding interest in maintaining peace and stability in the Taiwan Strait. Consistent with the Taiwan Relations Act, the United States makes available defense articles and services as necessary to enable Taiwan to maintain a sufficient self-defense capability. The United States continues to encourage the peaceful resolution of cross-Strait differences consistent with the wishes and best interests of the people on Taiwan

      The U.S. no longer sees Taiwan through a “one China” lens. China is signaling its displeasure by threatening to kill Taiwanese. Great for Russia.

      Reply
      1. Macroduck

        Actually, “one China” is still there, one paragraph lower and de-emphasized. And China is throwing a tantrum.

        Reply
          1. Moses Herzog

            BTW, the retardative Chinese allegory was a bonus for laughs. Here, let me make my own up just for laughs: “Puffiness of one cloud equals puffiness of one-thousand clouds”. Cool heh?? I could have been a Tang era poet.

          2. macroduck

            This is a hoot. Many immigrants seek prosperity by adopting a new country. China’s ambassador is telling them it won’t work, even though China is the country they felt they had to peave to seek prosperity. I’d like to say this ” things are true because the Chinese government sqy so” attitude is foreign to the U.S. way home thinking, but so many of the comments here are clipped from Faux News that I can’t say that.

          3. Moses Herzog

            Yeah, the MAGA brand of nationalism is very similar, and it’s been in America in some form or fashion since nearly the beginning. That story just really got my goat because the mainland government makes policy and propaganda moves which make Chinese Americans suffer more than they would otherwise, and then turns around and goads them that Chinese Americans aren’t playing team ball. Beijing is playing to Chinese people’s natural inclination that they are “at their core” Chinese (before/ or taking precedence over their Americanism). You won’t see Israeli leaders pulling this stunt (not in a mass public forum anyway) because Israeli leaders are at least smart enough to know you don’t throw blood into shark waters and then say “why can’t you seals be more like seals??”

      2. JohnH

        “ China is signaling its displeasure by threatening to kill Taiwanese.”

        Is this an official PRC policy…or just a figment of macroduck’s vivid imagination and jingoistic attitude?

        Reply
        1. pgl

          There are a lot of other accounts that suggest the PRC are about to do this. So take cheer as you can work for Xi as his pet parrot too.

          Reply
          1. JohnH

            Allegations without links, the usual pgl drivel…And if the links actually did exist, they would likely have come from Mr. Unidentified Source, the wellspring of much the disinformation and nonsense that pgl and macroduck avidly consume and parrot.

          2. pgl

            JohnH
            May 10, 2022 at 3:45 pm
            Allegations without links, the usual pgl drivel

            Hey troll – try reading some of the previous comments which did provide links. Your defense of murderous dictators is not only pathetic but it also shows how incredibly STUPID you really are.

        2. macroduck

          Threatening war is threatening death to civilians. I realize your pay-masters insist on denying that fact, but it’s the way war works.

          Reply
          1. JohnH

            Coukd macroduck, the über jingo, possibly entertain the thought that it is the US that is doing the threatening?

            William Astore, retired lieutenant colonel : “ Here’s what I wonder: Why in this century has America, the “leader of the free world” (as we used to say in the days of the first Cold War), also become the leader in promoting global warfare? And why don’t more Americans see a contradiction in that reality?” certainly, macroduck, with his jingoistic blinders can’t see any problem with ever more war.
            https://tomdispatch.com/the-last-good-guys/

          2. macroduck

            Johnny, Johnny, Johnny,

            So many problems with your posiion. For starters, you are trying to change the subject away from the potential of yet another war of aggression by a “greater power” against a lesser one. (Quotation marks necessitated by Russia’s battlefield performance.) You think our time is better spent in comments-section spitting contests than in considering the possibility of more unjustified civilian death?

            And you need to look up “jingoism”. It’s another one of those words you don’t seem to understand. So, jingoism is a strong, often militaristic form of nationalism. If you need an example, think of Putin. Or Xi. Now me, I opposed the second Iraq war. Heck, I opposed he Vietnam War. I opposed Trump, and a U.S. jingoU.Sjingoist normally oppose an “America first” politician, no matter how bad. Oh, and I supported the U.S. withdrawal from Afghanistan. Do I recall correctly that you had bad words to say about the withdrawal? A jingoist would more than likely support war, not oppose it. If you, for instance, were Russian, then your support for Putin’s war(s) could be considered jingoistic.

            Anyhow, I think you’re doing that ad hominy grits debating thingie. You know, when your own position is so weak that you attack the other guy instead of his argument, because that’s the only hope you have? Sad.

            I would dismiss you with a “nice try” but seriously, you efforts are so weak, I even can’t bring myself to mock you with praise.

          3. Noneconomist

            Could John H, Russian apologist extraordinarie, get any more pompous? Well, yeah. Every post.
            Has he considered it might be time to review his “data”?
            If, that is, he had any data to review and if he had the slightest clue how to review it, sure.
            Could he possibly become even more clueless? Bet on it.
            You don’t need 80-1 odds to collect on a sure thing.

          4. pgl

            JohnH
            May 10, 2022 at 3:55 pm
            Coukd macroduck, the über jingo, possibly entertain the thought that it is the US that is doing the threatening?

            Like his boy Putin is going to get the Nobel Peace Prize!

          5. AndrewG

            “Coukd macroduck, the über jingo, possibly entertain the thought that it is the US that is doing the threatening?”

            What planet are you on, JohnH? China has repeatedly threatened Taiwan and dismisses its independence. Russia invaded Ukraine and dismisses its independence. Large authoritarian governments threatening to invade or actually invading smaller democracies.

            Fire hot, knife sharp.

            But you can’t even bring yourself to acknowledge this.

        1. pgl

          China meets banks to discuss protecting assets from US sanctions

          DAMN! And Jingo Johnny boys are claiming we provide no links. Yea – he is truly an IDIOT!

          Reply
  8. ltr

    https://news.cgtn.com/news/2022-05-09/Chinese-mainland-records-415-new-confirmed-COVID-19-cases-19T2E8PKnbW/index.html

    May 9, 2022

    Chinese mainland records 415 new confirmed COVID-19 cases

    The Chinese mainland recorded 415 new confirmed COVID-19 cases on Sunday, with 401 linked to local transmissions and 14 from overseas, data from the National Health Commission showed on Monday.

    A total of 3,918 new asymptomatic cases were also recorded on Sunday, and 92,564 asymptomatic patients remain under medical observation.

    Confirmed cases on the Chinese mainland now number 220,040, with the total death toll from COVID-19 at 5,185.

    Chinese mainland new locally transmitted cases

    https://news.cgtn.com/news/2022-05-09/Chinese-mainland-records-415-new-confirmed-COVID-19-cases-19T2E8PKnbW/img/771d5c071793407ba4a8f251ee0b9885/771d5c071793407ba4a8f251ee0b9885.jpeg

    Chinese mainland new imported cases

    https://news.cgtn.com/news/2022-05-09/Chinese-mainland-records-415-new-confirmed-COVID-19-cases-19T2E8PKnbW/img/950e2e3c1bdd4c81abc1ba59d240afda/950e2e3c1bdd4c81abc1ba59d240afda.jpeg

    Chinese mainland new asymptomatic cases

    https://news.cgtn.com/news/2022-05-09/Chinese-mainland-records-415-new-confirmed-COVID-19-cases-19T2E8PKnbW/img/7a4b1b0fc27a4eabb66996f2a452b920/7a4b1b0fc27a4eabb66996f2a452b920.jpeg

    Reply
  9. pgl

    Who leaked the Alito draft opinion? Certainly not the Chief Justice and this expert says certainly any of the liberal three:

    https://www.msn.com/en-us/news/politics/supreme-court-expert-i-don-t-know-who-s-behind-leak-but-i-know-liberal-supreme-court-justices-would-never-have-been-party-to-it/ar-AAX5h3f?ocid=msedgdhp&pc=U531&cvid=6c36800534f64e85b4250af23c3a0aa7

    So we are left with the Federalist Five – Alito, Thomas, and the Trumpian trio.

    Republicans are ducking the real issue – a woman’s right to choose – by screaming we need to go after the leaker. Dudes – this one could come back to bite you.

    Reply
      1. pgl

        You may be right but if Clarence gave his wife a copy of it – he’d be in violation of basic ethics rules … not the 1st time for him.

        Reply
  10. pgl

    https://www.yahoo.com/entertainment/u-temporarily-suspends-tariffs-steel-171717671.html?msclkid=16d22d2dcfcf11ec9f73878519434519

    Following in Europe’s footsteps, the U.S. is suspending its 25% tariffs on Ukrainian steel imports, the Commerce Department announced Monday. The suspension will last for one year. The move, while it may be partly symbolic for now, is the latest effort to bolster Ukraine’s economy amid Russian President Vladimir Putin’s assault on the country. Steel is a key sector of Ukraine’s economy, representing 18% of the country’s total exports in 2018, according to a 2019 report from the Commerce Department….The tariffs were imposed by then-President Donald Trump in 2018, citing national security, with a 25% tariff on foreign steel imports and 10% on foreign aluminum imports. The ex-president imposed the tariffs over the objections of many experts, claiming other countries were undermining the U.S. steel and aluminum industries.

    First of all – we should eliminate this tariff permanently. Secondly, Trump’s rational for these tariffs was his usual stupidity. Of course hurting the economy of Ukraine made Trump’s master – Putin – quite happy.

    Reply
  11. macroduck

    A few Fed-related tidbits from Friday and today –

    Minneapolis Fed President Kashkari on Friday:

    If supply constraints unwind quickly, we might only need to take policy back to neutral or go modestly above it to bring inflation back down. If they don’t unwind quickly or if the economy really is in a higher-pressure equilibrium, then we will likely have to push long-term real rates to a contractionary stance to bring supply and demand into balance. The incoming data over the next several months should provide some clarity on these questions.

    Finally, we will need to continue to assess where neutral is. If the economy is in fact in a higher-pressure equilibrium, that might indicate the neutral long-term real rate has increased, which would then require even higher rates to reach a contractionary stance that would bring the economy into balance.

    Bloomberg helpfully explicated Kashkari’s statement, claiming Kashkari had said the Fed may need to “spur a recession” though Kashkari said no such thing.

    Today’s Financial Market Stability report from the Fed cites reduced liquidity across a number of real asset and financial markets along with reduced market depth across a number of markets.

    https://www.federalreserve.gov/publications/financial-stability-report.htm

    Homebuilders, meanwhile, report that demand for housing is weakening and investors are pulling back:

    https://www.calculatedriskblog.com/2022/05/homebuilder-comments-in-april-demand-is.html?m=1

    Fed tightening, through market action and guidance, is working quite well.

    Reply
    1. AndrewG

      “which would then require even higher rates to reach a contractionary stance that would bring the economy into balance.”

      Well, that kind of is “spur a recession” I’d say.

      Good shares and comments. I am a regular of Bill McBride’s Calculated Risk.

      Reply
      1. macroduck

        Aside from being right so much of the time and wriing with perfect clarity, McBride sets the standard for putting positive analysis ahead of his personal views. Extra points for being a scuba diver.

        Reply
        1. AndrewG

          He’s not an economist, but because of that he’s like an *old-school* economist: simple, intuitive models, and lots of graphs. It’s a breath of fresh air.

          Reply
    2. JohnH

      And here I thought that homebuilders’ costs were supposed to drop significantly…At least near to where they were pre-pandemic. Wasn’t that what all the self-professed geniuses in the room…like pgl and macroduck assured us, mocking all who dared scepticism.

      Guess not!
      https://fred.stlouisfed.org/series/PCU44414441

      No wonder demand for new home sales is declining…and those “transitory” supply chain issues are still hobbling builders’ ability to complete construction.

      Reply
      1. pgl

        “No wonder demand for new home sales is declining”

        I trust you know that FRED published real residential investment – and that series is still strong. Oh wait you babble BS without checking the data. Never mind.

        Reply
      2. pgl

        “And here I thought that homebuilders’ costs were supposed to drop significantly”

        Dude – are you really THAT blind. They did fall a lot from where they were in the summer of 2021 but they went back up a little bit. Still lower than they were in the summer of 2021.

        OK – you cannot read you own graph which explains why you think residential investment is down even if the data from BEA (FRED has it) says the opposite.

        Damn – you are so incompetent that you make the Village Idiot Bruce Hall look good.

        Reply
        1. JihnH

          Ummm, pgl…it was macroduck who said “ Homebuilders, meanwhile, report that demand for housing is weakening and investors are pulling back.”

          Take your snark to hiim.

          Reply
          1. pgl

            Macroduck routinely makes informed and well supported comments. You routinely write the dumbest garbage I have ever read.

        2. JohnH

          Ummm, pgl…it was macroduck who said “ Homebuilders, meanwhile, report that demand for housing is weakening and investors are pulling back.”

          Take your snark to hiim.

          Reply
          1. Barkley Rosser

            JohnH,

            Which is NOT the same as costs for homebuliders’ declining. You are really seriously out of it.

      3. Macroduck

        Johnny, Johnny, Johnny,

        Pretending to hold commenters to account is just not a good look for you. It looks too much like spite, since you are so often called to account for being wrong.

        You are pretending. Find a comment in which I predicted a decline in building material costs. Go ahead.

        What I have said is that the math of y/y inflation comparisons is likely to mean smaller core inflation figures stating about now. And, whatayaknow, 6.4% followed 6.4% in the last two readings, the first time since August of last year that the y/y comparison didn’t go up. Let’s see what next month brings, shall we?

        Till then, no more lies about my forecasting record, OK?

        Reply
        1. Macroduck

          Heck, while I’ m at it, I will make a contingent forecast. When sales cool, construction will cool. With a large overhand of unfinished homes, construction could cool rapidly. Whan that happens, construction material prices will cool, as well.

          When I’m right about this, feel free to mention it.

          Reply
          1. Moses Herzog

            This seems like a market moving event.
            https://www.wsj.com/articles/natural-gas-prices-rise-in-europe-after-ukraine-cuts-flows-11652255011?mod=hp_lead_pos9
            I view it as a positive. If Germany can’t do the right thing then they’ll have to deal with whatever is handed to them. They should have adjusted to this with chilled gas and other energy options years ago. Germany decided to socialize with Putin and now Germany will have to live with the consequences. Even if morality has to be forced on them.

    1. Barkley Rosser

      WTI is under $100 per barrel even as the headlines are all about gasoline prices reaching some new all time high.

      Reply
      1. pgl

        https://www.eia.gov/petroleum/gasdiesel/?msclkid=91b8d673d14b11ec82539958365c16ef

        I love this gas pump diagram which is showing that refinery margins and distribution margins are both 18% of that $4.22 per gallon which translates into $0.76 for the refinery and $0.76 for the distributor. Normally these margins would be $0.3 per gallon each. I would suggest that the Federal government check into this as it sounds a bit like good old fashion oligopoly power.

        Taxes are 12% or $0.50 per gallon. Of course we need the revenues to pay for upkeep on the roads.

        Reply
  12. pgl

    https://www.msn.com/en-us/news/politics/susan-collins-called-the-cops-to-report-defacement-of-public-property-after-someone-wrote-a-pro-abortion-rights-message-in-chalk-on-a-public-sidewalk-outside-her-house/ar-AAX78aN?ocid=msedgdhp&pc=U531&cvid=e8a8c518d6b9473f90a1bda08fe2bb50

    Is Susan Collins kidding me? Pro-choice types wrote used chalk to write on a side walk support for the proposal to codify a woman’s right to choose. This was not violent. It was not destructive of public property (after all chalk easily washes off), and it in no way was a threat to anyone. But Collins called the police as if some violent crime was being committed. Pathetic.

    Reply
    1. Barkley Rosser

      pgl,

      The shortage is real. What is really weird though is that somehow Putin trolls on various sites are somehow trying to tie this to US support for the Ukrainians in the current war. If only the NATO Nazis were not wickedly arming those awful Ukrainians, well, there would be no baby formula shortage!

      Reply
    2. AndrewG

      I have no background here but … how could there *possibly* be a shortage of baby formula? It’s just food-grade ingredients, like any other highly processed substance made for human ingestion. Maybe manufacturers are extra careful or something? Is there super tight regulation?

      No, I don’t want to read the Prospect blog post.

      Reply
      1. Barkley Rosser

        AG,

        The problem seems to be most clearly due o a major recall by Abbot Labs, a major producer of inputs to it, due to some of their stuff being toxic. Just exactly what it was that was the problem, I do not know, but that seems to be what triggered it.

        I do not know if you have had a kid, but the problem is that infants get tied to a particular formula and won’t eat anything else, even something nice family cam make up out of regular ingredients. So if the brand they are used to is not available, it is a problem. This is not a joke, although people like ltr or the various Putin bos out there trying to turn it into something it is not is pretty annoying.

        Reply
        1. AndrewG

          Thanks for filling me in. Looks like part of the problem is tariffs though. We could be importing more of the final good (not sure about the intermediate).

          Reply
  13. pgl

    https://www.msn.com/en-us/news/politics/mcconnell-calls-us-abortion-ban-possible-says-he-won-t-change-filibuster-to-pass-it/ar-AAWYMK3?ocid=msedgntp&cvid=59e50f6d5c6444f58ee2970071d5e789

    “Be the compassionate, consensus builder on abortion policy,” said an advisory document from the National Republican Senatorial Committee, the GOP’s campaign arm in the battle for control of the upper chamber currently split 50-50 between the two parties.

    Damn – the Republicans lie about EVERYTHING. They want to tell women that their bodies belong to a bunch of sexist men but they still pretend they are compassionate consensus builders. That is like the wife beater who tells his abused wife that he will clean up the blood from the floor at her whooping. So polite of them!

    Reply
  14. ltr

    Unbelievably ill-conceived.

    Is China prepared to fight a world war? To break through an oil and trade embargo at the north and south entrances to the South China Sea?

    Unbelievably reckless on the part of –.

    [ Definitive falseness. Definitive, ceaseless racism. ]

    Reply
    1. macroduck

      Yeah, and Putin denied he was preparing for war until he attacked Ukraine. Liars lie.

      And that racism bit you keep dragging out. I know you have orders from your masters to say “racist, racist, racist” but it’s just so dumb. China rounds up ethnic minorites and puts them in concentration camps, for Mao’s sake! Your masters are racist monsters on a scale seldom matched in all of history. Your bleating about supposed racism against your racist masters is downright sickening.

      Meanwhile, China is building a military designed to project power beyond its own borders while blathering about sovereign autonomy, engaging in provocations near Taiwan and kidnapping ethnic Chinese from inside the U.S. You’ve sold your soul – does Xi allow you to believe you have a soul? – to a truly despicable regime.

      Reply
    2. AndrewG

      Defending the independence of a majority-Han Chinese country from the threats of a (much larger) majority-Han Chinese country is … racist?

      When you are copying and pasting your government press releases, do you ever take the time to really think about what you’re doing?

      Reply
    3. Barkley Rosser

      ltr,

      Sometimes your complaints that comments here are “racist” have some validity. Not this time. Calling a possible aggressive war policy by the PRC “recliess” is not racist. Especially in light of the disaster Putin’s invasion of Ukraine has turned into, an attack on Taiwan or other aggression would indeed by highly reckless.

      Is it “racist” to call Putin reckless or stupid for having invaded Ukraine? If not, then why is it so for suggesting that an aggressive act of war by the PRC is? Xi Jinping is perfectly capable of being stupid, and calling him that if he is is not racist. Sorry. As it is, hopefully he will listen to calmer and cooler voices and not engage in any aggressive war actions, at least not any time soon, but preferably never. We are having more than enough awful wars caused by war criminals invading their neighbors.

      Reply
  15. ltr

    https://www.fmprc.gov.cn/eng/zxxx_662805/202205/t20220510_10683865.html

    May 9, 2022

    Opening Ceremony of the High-Level Meeting of the Group of Friends of the Global Development Initiative

    Beijing

    State Councilor and Foreign Minister Wang Yi

    Wang Yi said, we meet at a time when the world is beset by global changes and a pandemic both unseen in a century. World economic recovery is facing headwinds. North-South gap keeps widening. Development cooperation is losing steam. And the implementation of the 2030 Agenda for Sustainable Development is facing unprecedented challenges. Last September, President Xi Jinping proposed the GDI at the UN General Assembly. The purpose is to galvanize worldwide attention to development, strengthen global development partnership, promote international development cooperation, and lend fresh impetus to the realization of the 2030 SDGs.

    Wang Yi said that since the very beginning, the GDI has been warmly received by the international community. More than 100 countries expressed support, and as many as 53 countries have joined the Group of Friends. This fully shows that the GDI responds to the call of the times, meets the needs of various countries, and reflects the trend of the world as well as the aspiration of the people. The GDI is committed to building political consensus on accelerating development, building a common platform for development cooperation, promoting exchanges and mutual learning of development experience, and enhancing international synergy for coordinated development. China proposes that all parties work together in four key areas for the GDI to deliver concrete results.

    First, re-energizing global cooperation on the 2030 Agenda. Implementation of the Agenda should continue to be a priority on the international cooperation agenda. All parties must honor their pledges and realize the 17 SDGs on schedule. We must oppose the politicization and marginalization of the development issue, continue to focus on the key areas most important to developing countries, and redouble our efforts to raise living standards across the world.

    Second, creating a favorable environment to accelerate global development. We need to improve the global governance system at a faster pace, increase the representation and voice of emerging markets and developing countries, and build an open world economy. It is important to uphold the right of people of all countries to choose their own development paths, and oppose interference in other countries’ internal affairs and unilateral sanctions without basis in international law.

    Third, fostering equal and balanced global development partnership. Developed countries should fulfill their development assistance pledges and scale up support in financing and technology. Developing countries need to deepen South-South cooperation and realize leapfrog development. In the process, multilateral development institutions should provide more effective help to maximize synergy for development.

    Fourth, enabling the UN system to play the central and guiding role. We support the United Nations as the main coordinator in the implementation of the 2030 Agenda. We support the UN Secretary-General in making development a priority, mobilizing UN development agencies, and implementing the GDI to help achieve the SDGs. It is therefore necessary for the United Nations to advance institution-building for enhanced coordination….

    Reply
    1. ltr

      “According to official information, in March 2022, 146 countries and 32 international organizations had signed cooperation agreements for the Belt and Road Initiative.”

      China is part of the 14 country Regional Comprehensive Economic Partnership, which includes about 30% of the world’s population and 30% of world GDP.
      There are the 10 countries of the Association of Southeast Asian Nations with which China has a free trade partnership.
      China is part of the Shanghai Cooperation Organisation, which includes almost 3 billion people.

      There is of course more, even to the Chinese-international satellite system and the Chinese-international space station that will be completed and permanently crewed in a few months.

      Reply
    2. ltr

      Developing the list:

      There are 146 countries and 32 international organizations that are part of the China created and led Belt and Road Initiative.

      China is part of the 14 country Regional Comprehensive Economic Partnership, which includes about 30% of the world’s population and accounts for 30% of world GDP.

      There are 10 members of the Association of Southeast Asian Nations, with which China has a free trade partnership.

      China is part of the Shanghai Cooperation Organisation, which includes about 3 billion people and covers about 4 times the territory of the United States with Alaska.

      There is the partnership of Brazil, Russia, India, China and South Africa.

      There is the Greek-Chinese port, the Israeli-Chinese port, the Pakistan-Chinese port, the Cambodian-Chinese port…

      There is of course more, even to the Chinese-international satellite system and the Chinese-international space station that has already been crewed and will be completed and permanently crewed in about 3 months.

      Reply
    3. AndrewG

      This one is *literally* a government press release.

      Are you a press liaison for the Chinese government, ltr?

      Here, I’ll start: I don’t represent any government anywhere in any form.

      Reply
  16. macroduck

    I’m trying to keep track of the effects of Fed monetary tightening. The wealth effect is among the channels through which Fed policy works. Ran across a factoid which suggests the Fed is having considerable effect through declining financial asset values. Turns out, so far this year, a 60/40 portfolio (stocks/bonds) has lost over 12% of its value. That is by far the largest decline for the first 4 months of the year in at least 45 years. Meanwhile, Goldman has told clients that “risk parity” strategies (an increasingly common alternative to 60/40) have suffered one of the largest drawdowns in 40 years (which is about as long as the strategy has been around).

    The wealth effect apparently works more strongly through residential real estate than through financial assets, and wealth in residential real estate is still rising. However, the rapid rise in mortgage rates has reduced mortgage applications for refinance – a typical vehicle for turning residential real estate wealth into consumer spending – by 71% from a year ago.

    I am beginning to doubt whether the Fed will need to continue with rate hikes in line with current market pricing and the Fed’s own thinking. Households in general have healthy finances, which many analysts point to as reason to expect spending to hold up, but that’s a statement about aggregate conditions. It is also a statement which is less true now than at the end of last year, before financial asset prices collapsed and mortgage equity withdrawal became an expensive proposition. If hiring slows, consumer demand growth will slow right along with it, with limited help from household balance sheets.

    Reply
    1. AndrewG

      CPI numbers today were not so hot. And by that, I mean they were too hot — above expectations.

      I hope you’re right though.

      Reply
  17. ltr

    https://english.news.cn/20220323/02a1bb98b82b465a9774029ad01797fd/c.html

    March 23, 2022

    Bangladesh attains full electricity coverage with inauguration of China-funded power plant
    With the opening of the China-funded power plant, Bangladesh has achieved another milestone in implementing the government’s pledge of 100-percent electricity coverage.

    DHAKA — Bangladesh has moved to a new era by attaining 100 percent electricity coverage in the country with the inauguration of the first China-funded eco-friendly mega power plant at Payra in Patuakhali district, some 204 km south of the capital Dhaka.

    Bangladeshi Prime Minister Sheikh Hasina inaugurated the country’s first 1,320MW ultra-supercritical coal-fired power plant by releasing 1,320 pigeons at an auspicious ceremony on Monday.

    The prime minister visited the project site and inaugurated the coal-fired power plant by unveiling its nameplate at the function in presence of hundreds of local and foreign dignitaries, including Chinese Ambassador to Bangladesh Li Jiming.

    A festive mood prevailed from beach town Kuakata in Bangladesh’s Patuakhali district, some 204 km south of Dhaka, to the Payra power plant and their neighborhoods which got huge facelift with various eye-catching decoration pieces, including hundreds of boats – election symbol of Hasina’s ruling Bangladesh Awami League party.

    Bangladesh-China Power Company Limited (BCPCL), a joint venture of China National Machinery Import and Export Corporation (CMC) and Bangladesh’s North-West Power Generation Company Limited (NWPGCL), and a consortium of China Energy Engineering Group Northeast No. 1 Electric Power Construction Co., Ltd.(NEPC ) and China National Energy Engineering and Construction Co., Ltd. (CECC) signed the plant’s engineering, procurement and construction (EPC) contract in 2016.

    To implement Payra 1,320MW Thermal Power Plant Project in the fastest possible time, the EPC work also started on March 30, 2016 and the project was completed in due time.

    With the Payra power plant, Bangladesh has been credited with the 13th country in the world using Ultra Supercritical Technology.

    Addressing the inauguration ceremony, the Bangladeshi premier said, “This is the biggest thing that we’ve been able to light houses of every people.” …

    Reply
  18. ltr

    https://www.nytimes.com/2022/05/10/us/baby-formula-shortage.html

    May 10, 2022

    A Baby Formula Shortage Leaves Desperate Parents Searching for Food
    Some parents are driving hours at a time in search of supplies. Others are watering down formula or rationing it, hoping for an end to the shortage.
    By Edgar Sandoval, Amanda Morris and Madeleine Ngo

    SAN ANTONIO — Maricella Marquez looked at the last can of baby formula in her kitchen on Tuesday and handed her 3-year-old daughter, who suffers from a rare allergic esophageal disorder, a smaller-than-usual portion of the special nutrition she needs to stay healthy.

    Ms. Marquez has been calling suppliers all over Texas, asking about any new shipments. “Right now they are out of it, completely,” she said. “I’m desperate.”

    Ms. Marquez lives outside San Antonio, a city that has seen the nation’s highest rate of formula shortages — 56 percent of normal supplies were out of stock as of Tuesday, according to the retail software company Datasembly — amid a nationwide supply crunch that has left parents scrambling to feed their children.

    The shortage has been a challenge for families across the country, but it is especially palpable at grocery stores and food banks in San Antonio, a Latino-majority city in South Texas where many mothers lack health insurance and work at low-wage jobs that give them little opportunity to breastfeed. Across the city, baby food aisles are nearly empty and nonprofit agencies are working overtime to get their hands on new supplies.

    The shortage became acute with a recall of a defective brand this year after at least four babies were hospitalized with bacterial infection and at least two babies died. But the recall has been exacerbated by relentless supply-chain woes and labor shortages. The Datasembly research found that the national out-of-stock rate for baby formula reached 43 percent for the week ending Sunday, up 10 percent from last month’s average….

    Reply
  19. baffling

    “Turns out, so far this year, a 60/40 portfolio (stocks/bonds) has lost over 12% of its value. ”
    father in law is very unhappy about that 12% loss, in an investment strategy that was supposed to be somewhat conservative. during the past few months, there has really been nowhere to hide, as both bonds and stocks have suffered quite a bit. i view it as simply a correction in two overpriced asset classes. rising interest rates (from very low values) will reset most markets. i expect once this reset occurs, stocks and bonds will regain more historical trend relationships (ie one will rise while the other falls).
    “I am beginning to doubt whether the Fed will need to continue with rate hikes in line with current market pricing and the Fed’s own thinking. ”
    if you are saying the fed will slow down rate hikes by the end of the year, i agree.

    Reply
    1. Barkley Rosser

      Baffe,

      Bet he is still better off than a few years ago. This is the endowment effect, a well known and widely out there example of economic irrationality. You can tell him that. People get much more upset about losing something than they are pleased getting it. I have no sympathy for such stupid whining. Tell him that is the view of a professional economist. He can just suck it up along with the rest of us. Things go up and things go down. Duh.

      Reply
      1. baffling

        yeah, we have had that conversation. we asked him when he first opened the account, what would you do if the market dropped 20%. he said put more money to work in a cheaper market. behavior changes when reality sets in. he just needs to sit tight and ride it out over a couple of years. its only a loss when you sell. in the longer run, he will be just fine. doesn’t need the cash now anyways.

        Reply
      2. Barkley Rosser

        baff,

        I just checked. Even after today’s further decline, the stock market is still higher than it was when Biden took office, not that you will hear any of the Trampcheiss ranting about how terrible Biden is for the market admitting that. Anyway, there is another point you can remind him of.

        Yeah, this is a time to hang on, not bail. And whining does not help.

        Reply
  20. Moses Herzog

    It appears Copmala Harris may have performed her first ever useful act in politics yesterday. I knew if Copmala tipped the pinball machine back gentle she could save one without triggering a tilt. Now if Copmala could just hide all those cases where Blacks were rotting in jail in California and she worked at keeping them there. [edited MDC]

    Reply
    1. AndrewG

      Kamala Harris is indeed a cop (or at least, a former prosecutor). The vast majority of people don’t think that’s a bad thing.

      Reply
      1. Barkley Rosser

        AG,

        You need to understand that our Moses has a list of Bad Powerful Women he calls names and denounces on a regular basis. Harris is on the list as I Pelosi, who is “senile” according to him, especially for having flagrantly publicly shown a like for expensive ice cream. He has eased up on her more recently, but Elizabeth Warren was on this list for quite a while, and several others are as well. It seems to be almost random how they get on this list, and occasionally he moves somebody on or off his hate list. It is pretty sick actually.

        Reply

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