This week’s GDP and employment numbers were a pleasant surprise. Should this cause the Fed to change its warning in Wednesday’s FOMC minutes that
the pace of economic expansion will likely slow in the near term.
Author Archives: James_Hamilton
GDP up, recession probability down
Fret as we all might, the U.S. economy just keeps on growing.
The Salem witch trial of Elizabeth Jackson Howe
For Halloween I could perhaps write something about what’s spooking the Fed as they contemplate tomorrow’s fed funds rate decision. But I decided instead to write about the Salem witch trials.
Econoblogger at work
Cute pic from the Curious Capitalist.
$90 a barrel: Is it time to start worrying about the oil price shock of 2007?
Oil shocks in 1973, 1979, and 1990 were each followed by a recession. But we saw the price of oil climb from $20 a barrel in 2002 to $75 a year ago, and so far it has not resulted in a significant economic downturn. What’s different now, and can we count on it to continue?
Why is oil above $90?
The answer is pretty simple, really– demand keeps going up but supply doesn’t.
San Diego fires
Thanks to our many friends around the world who’ve asked if we’re ok. We are indeed, and, if you’re curious, here’s our story.
Rules versus discretion in monetary policy
I had the privilege of attending a conference in St. Louis this week on Monetary Policy under Uncertainty at which I presented a paper on the response of interest rates to changes in the fed funds target. One of the interesting themes that came up in some of the other papers concerned whether the public’s interests are best served when monetary policy follows mechanical rules as opposed to responding to events in a discretionary way. Here I report on some of the discussion of this issue from the conference.
Deteriorating lending standards
What is the significance of the fact that the most recently issued subprime mortgages are the ones that are running into the biggest problems?
Superconduit
The Wall Street Journal describes it as a “superconduit”,
the New York Times refers to it as a “super-SIV”,
and the Washington Post is calling it a
“Master-Liquidity Enhancement Conduit”. Whatever you call it, does it make any sense?