The Philadelphia Fed coincident indices for October are out. Figure 1 presents the log series, normalized to January 2011 = 0.
Author Archives: Menzie Chinn
Trade Financing Use of China’s Yuan
From Reuters:
China’s yuan currency overtook the euro in October, becoming the second-most used currency in trade finance, global transaction services organization SWIFT said on Tuesday.
Some Observations on the Efficacy of Monetary and Fiscal Policy
Japan edition
Inflation and output are up. So too is gross fixed capital investment. The yen is weaker, and the real quantity of net exports is higher.
Fiscal Drag in 2013
From Torsten Slok at Deutsche Bank:
[F]iscal drag in 2013 is 2.4%, ie if GDP growth in 2013 ends up being 1.7% then if we had not had the fiscal drag then GDP growth would instead have been 4.1% (=1.7% + 2.4%). ..
Wisconsin Employment: October 2013
Two numbers to remember: 84 thousand and 107 thousand
Jeffrey Frankel: “The Dollar and Its Rivals”
JEC Chair Brady and the Inflation Outlook
From a statement by the Joint Economic Committee Chairman, October 9th, 2013:
I fear that the Federal Reserve through current policies of Quantitative Easing and maintaining extraordinary low interest rates may be providing the fuel for igniting high
inflation.
“Fiscal Policy: Accomplishments, Challenges and Opportunities”
That’s the title of CEA Chair Jason Furman’s presentation at the University of Wisconsin at Madison on Monday. Introduced by UW Chancellor Becky Blank, his discussion covered a wide range of issues. From WisBusiness:
Jason Furman, chairman of Obama’s Council of Economic Advisers, said Congress should invest in infrastructure at today’s low borrowing rates, reform the tax code, approve an immigration reform bill projected to cut the deficit and agree on long-term debt reduction, instead of implementing short-term cuts like sequestration that impede economic growth.
Apocalyptic Macro: Inflation Edition
From an opinion piece by Sean Fieler in USAToday:
If easy money delivers what it always has throughout history — growing inflation, growing inequality and growing government — a Republican embrace of sound money will offer America a way back to prosperity and the GOP a way back to a governing majority.
Assessing the Crowding Out Hypothesis: An Undergraduate Textbook Analysis
1. From my (undergraduate) Economics 390 “Topics in Macro” midterm:
Consider this statement:
“Borrowing and spending by the public sector will crowd out investment and growth in the private sector.” Paul Ryan, “Path to Prosperity” (April 2012).
1.1 In a standard IS-LM model, where investment spending is given by:
(7’) I = b0 – b2i
Will higher government spending crowd out investment? Use a graph to help explain your answer.