August auto sales worst in 27 years, declared some headlines. While the statement may be true, I don’t think it’s the best way to summarize what we’re seeing.
Author Archives: James_Hamilton
Policy tools that could lower interest rates further
Even though the overnight interest rate has been stuck near zero for 20 months, are there options available to the Federal Reserve or the U.S. Treasury to bring longer-term yields down further? I have been looking into this question with Cynthia Wu, an extremely talented UCSD graduate student. We present our findings in a new research paper, some of whose results I summarize here.
New database on the maturity structure of publicly-held debt
I have been working on a project with UCSD graduate student Cynthia Wu to try to assess the potential for the Federal Reserve to continue to influence long-term interest rates even when the short-term interest rate is essentially at zero. I’ll be relating the conclusions from that research in a few days. But first I’d like to call attention to a new data set that we developed on the maturity structure of publicly-held debt which may be of interest to other researchers. As Paul Krugman likes to warn, this one is just for the wonks.
GDP revised down
The Bureau of Economic Analysis, which last month had estimated that U.S. real GDP had grown at a 2.4% annual rate during the second quarter, today revised that estimate down to a 1.6% annual rate. But the revision isn’t quite as discouraging as it might sound.
More thoughts on what to expect from the Fed
There is disagreement within the FOMC. How will it be resolved?
Long-term perspective on the stock market
Nobody can tell you for sure what’s going to happen next in the stock market. But thanks to the nice data set collected and maintained by Yale Professor Robert Shiller we can speak with authority about what it’s been doing for the last 140 years.
Will the Fed do more?
If conditions deteriorate further, I believe the answer is yes.
Escape from arbitrage: the movie
Two of my favorite economists, Bilkent University Professor Refet Gurkaynak and Johns Hopkins University Professor Jonathan Wright, have a nice new paper in which they survey macroeconomic theories of the term structure of interest rates. As an unusual digital supplement to their paper, they put together a movie in which you can watch the arbitrage glue that normally holds markets together start to fail as financial markets literally fell apart at the end of 2008.
Ever so slightly less contractionary
What is the significance of yesterday’s statement from the FOMC?
Current economic conditions
Last week’s new economics data were a mixed bag. But on balance I’d have to say I’m more discouraged than when the week began.