Employment fell as EPU rose; production stalls as Geopolitical Risk spiked.
The Economy: When We Last Entered a Land War on the Asian Mainland
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Core PCE Instantaneous Inflation at 3.6% in January, Same in February?
Using the Cleveland Fed nowcast for February, y/y inflation will be 3%, instantaneous at 3.2%, 3.6% instantaneous using Goldman Sachs estimate based on today’s PPI release.
Interpreting the Shrinking Term Spread
At high frequency, the 10yr-3mo and 10yr-Fed funds spreads are shrinking:
Alternative Estimates of Q4 Output
GDO and GDP+.
News-Based Trade Policy Uncertainty Highest since April
So the IEEPA tariffs are gone. Now a hodge podge of indefinitely-lived tariffs lives on, with uncertainty elevated.
Confidence and Sentiment: February 2026
With the release of the Conference Board’s Confidence Index, and the SF Fed’s News Sentiment Index, we have the following picture:
Guest Contribution: “Understanding Bond-Stock Price Comovements”
Today, we’re fortunate to have Willem Thorbecke, Senior Fellow at Japan’s Research Institute of Economy, Trade and Industry (RIETI) as a guest contributor. The views expressed represent those of the author himself, and do not necessarily represent those of RIETI, or any other institutions the author is affiliated with.
Cautionary Notes to Avoid Rookie Economist Errors, Revised Edition:
As I’m teaching econometrics, I’m adding in handling-of-data issues. Examples from the last three years.
Business Cycle Indicators: GDP, Personal Income, Mfg & Trade Industry Sales, Consumption
NBER Business Cycle Dating Committee (BCDC) key variables:
