Remember this Kevin Hassett projection of Covid-19 deaths, from May 2020?
Source: CEA archived.
In this video, Kevin Hassett predicts (“almost for sure”) 7% year-on-year inflation by December.
Figure 1: CPI – all (blue), and Hassett prediction of 7% y/y inflation for 2021 (brown square), and University of Michigan survey of consumers implied prediction (teal square), on log scale. Source: BLS via FRED, University of Michigan, and author’s calculations.
This implies that month-on-month inflation June through December will average at least 7.3%, substantially higher than the 4% the University of Michigan’s June survey implied for the next year (through June 2022).
Other Hassett predictions recounted on Econbrowser (a partial list):
“National Review Institute” ………
Is it really worth that much to Hassett that he will trash his own reputation to feed blood chum to the MAGA fishies?? It appears “we’re” going the route of Stephen Moore. After all, why make an effort in life, aye?? Just show up to that job interview in sweat pants when you know they’re going to hire you anyway. Does this mean Hassett is going to get divorced and dodge his alimony payments soon??
Possibly the Kudlow route is more fashionable or trendy now?? Start snorting cocaine ’til you have about 3 marbles left rolling around your head and then invite the Kleagle over for your birthday party:
https://www.vox.com/2018/8/22/17768296/peter-brimelow-vdare-kudlow-white-house-racism
It must be. Lol.
His 1999 or so prediction was that the Dow would go to 36000 in the next 3 to 5 years. And that it was already worth 36000 but that it was going to take time for the market to realize that Kevin was right. What a loser.
Kevin Hasset; “Eff it. I’m going quintic fit!”
Hey, if you’re getting $60,000 for a 30 minute talk, you are going to be expected to throw some red meat to the audience. You have to scare the bejeebers out of the marks if you want them to send in that money. It’s all part of the grift.
Sure he had to do a little embarrassing butt kissing at the White House but that’s a small price to pay for setting up a lifetime of luxurious wingnut welfare.
I was trying to catch up on my WSJ reading. Has anyone read about this Credit Suisse stuff?? It’s really unbelievable. If you are to believe employees’ rendering of events, you’d think these folks were like some state-level government agency in Kentucky and using technology from 1978. It’s really hard to buy how they say this all went down. Aren’t we told that banks, especially investment banks are equipped with the most modern technology? Yet they say trades weren’t up to date in Reviews of transactions. Am I the only person who wants to call out “BS!!!!” on this June 8 story by Glazer, Farrell, and Patrick??
Makes you wonder how high speed traders can make a billion trades daily, while the average joe needs to wait three days for a trade to clear. Very selective use of technology.
I was very disappointed by credit suisse. Problem is, no big banker is ever really held accountable outside the occasional sacrificial lamb who was probably going to leave the business anyways.
I have a pet conspiracy theory on that one baffling. When they say they are “clearing” the trade what the brokerages and banks are actually doing, is using your ( “your” here read as small individual investors) money interest free. But “FINRA takes its regulatory function very seriously”, as nearly as “seriously” as the Federal Reserve, so I am sure brokerages and banks would “never” use investors’ money interest free.
I am semi-ashamed to tell you I am not sure how long it takes for a high speed trader’s transaction to clear. Just because they transact the trade (full circle buy-sell) doesn’t mean it has technically cleared. You can do 3—4 trades in a day right?? Say you could buy AND sell three different stocks (buy and sell the same stock on the same day). But the brokerage would still tell you that you have to wait 3 days for it to “clear”. The only problem arises is when you don’t have enough cash in your account for the next trade, which is something “big players” don’t have to worry about so much.
Now, Baffling my friend, if you want to really have some dinosaur conversation here, in my much younger days (around the time Barkley hit 80) it used to annoy the hell out of me that you had to keep the actual physical stock certificate with the brokerage, or they would drag their feet making the trade. And give you another indication of how “dinosaur-ish” age we are talking, this was in the days when Charles Schwab was the best game in town on commission rates, before outfits like TD Waterhouse (now TD Ameritrade) and Prudential took Schwab out behind the woodshed on commission rates. I am old enough [ hides my face from view ] that I remember being a young man, and being exhilarated beyond belief (Like I had just met Blake Lively at my local grocery store) when I got the physical stock certificates in my post office box.
Excuse me, I meant to say Fidelity, not Prudential. They all start to sound the same don’t they??
Add DOW 36000 as of 20 years ago. This crew also had Rich Lowry talking about economics????
This is anecdotal evidence and I should document these graphs with what GOP politicians and what some conservatives in rural areas of Wisconsin were saying to me in April and May 2020: “you egghead scientists and your models – that’s not real life”; “just like the flu 2.0 – couple people get sick – no big deal”: “couple of people from China – flying into Madison”; “it’s all in the cities – don’t need to worry if you live in the country,” – But, the models were initially based on people following basic healthcare measures – washing your hands; wear a mask; social distance.
Because of complete FUBAR response from Trump and criminal talk on Fox News – we are at 600,000+ deaths and in Wisconsin – with low vaccination rates – we can expect this pandemic to linger in rural counties – and, possibly surge next fall.
Also – Dr Chinn – I noticed a WIGOP assembly legislator talking about how the economy is on a “sugar high” (No idea what he means – but I assume that is the latest Fox News talking point) and WI doesn’t need to take any extended UE benefits. It would be useful if he would study his own WI Dept of Revenue – Wisconsin Economic Outlook and Forecast that expects UE to be impacted throughout 2021 – especially in leisure and hospitality. More useful to encourage constituents to get vaccinated – rather than repeating something he heard on Fox. https://www.revenue.wi.gov/Pages/Report/WI-Economic-Outlook.aspx
Finally – thank you Dr Chinn for your work.
“It appears “we’re” going the route of Stephen Moore.” That’s exactly what I was thinking. Perhaps we should create a “Stephen Moore Eagle Award for Worst Pseudo-Quantitative Analysis” (the “Eagle part is in honor of, IIRC, the newspaper that published an editorial to explain why the paper would never print another of Moore’s misleading columns).
Of course, Moore will win his own eponymously-named award several times each year, just because he is who he is. Hassett, however, deserves a belated one for last year’s “model,” noted in the OP, and his new “Seven Percent Delusion” is a very strong candidate this year.
Your comment about Kudlow brought to mind what a coworker said recently about a mutual acquaintance: ‘If he had a brain cell … it would be lonely.”
I hope that brings a smile amid the relentless heat.
Check out how iron prices have soared to record highs:
https://fred.stlouisfed.org/series/PIORECRUSDM
Maybe Hassett was using Stephen Moore’s iron ore commodity measure of the overall price level!
Might be interesting to take a look at lumber futures. They have deflated over 30% in just the last month. This could be a hint at how the other temporary supply shortages like used cars will trend.
(Hey, since everyone likes annualized rates, that means that by next year Home Depot will be paying you to haul away two-by-fours from their stores! If only I could afford one of those high priced used pickup trucks.)
That’s extremely interesting to me, because I had not been paying attention to futures much, outside of oil, and they just had on a story yesterday late afternoon about a lumber shortage and how prices were still rising at lumberyards and lumber mills (I guess I should say “spot” prices were rising?). I’m not doubting you, I’d take your word over 80%+ of the TV news, still it’s interesting you saying this when I just saw that TV story yesterday
Was it a week ago that I saw some story about lumber prices doubling? Even back then the reporter suggested this price increase would be temporary. I wish I remembered his name as he had to be one of the brighter business reporters out there.
I knew joseph is a straightshooter and was telling us the truth. Still seeing it right in front of your yes is something else. Use this link, and switch the web interface setting to monthly “1M” with an hourly “interval”. You can see the change is already happening. This strongly contradicts a lot of people saying there will even be zero inventory in some lumberyards soon. It’s possible, but how do you make that out with lowering futures??
https://quotes.ino.com/charting/?s=CME_LBS.N21_U21
The obvious answer here is, if you’re building a new home, renovating your house etc, why not wait 9 months before you start—delay it 9 months. Are you going to die of mental torture if you wait 1 year on that used car?? Yes, some people will need that used car right now. But a large percentage of them, can WAIT ’til car dealers quit playing children’s games.
Someone should make a list of these crazy predictions with name, prediction and actual outcome.
@ Ivan
I have a long long scroll of them by a JMU prof I keep by my computer. One time, the scroll unwound, broke a front window and almost killed my neighbor’s dog. Do you know anything about well educated scientists who are masochistic about spreading sometimes terminal viruses Ivan?? Ivan, be sure to get back to me on this. Also I need to know how Copmala Harris did in 2020 South Carolina primaries. I heard Copmala was going to be in a “serious showdown” with Biden, but got distracted and lost track of it.