Today, we are fortunate to have Luciana Juvenal and Ivan Petrella, as guest contributors. In this post, they respond to Wednesday’s guest contribution by Lutz Kilian, entitled Oil Price Spike Exacerbated by Wall Street Speculation?.
Author Archives: Menzie Chinn
Guest Contribution: “Oil Price Spike Exacerbated by Wall Street Speculation?”
A recent study by Luciana Juvenal and Ivan Petrella suggests that the financialization of oil futures markets contributed significantly to the surge in oil prices after 2003. Lutz Kilian, Professor of Economics at the University of Michigan, questions their analysis and highlights that their paper actually does not shed any light on the role of Wall Street speculation.
Crowding Out Watch: July 2012
As feared by Representative Ryan, in March 2011, crowding out due to deficits: The ten year inflation adjusted constant maturity rate as of 7/20 was -0.67%
Source: St. Louis Fed FRED accessed 7/24 11am Pacific.
The Path Not Taken … Thus Far: Debt Deleveraging by Inflation
From the latest issue of the Milken Institute Review, “Trends: Better Living Through Inflation” (co-authored with Jeffry Frieden):
Wisconsin Employment Release for June: Payroll, Private, Civilian Employment Decline.
The BLS has released preliminary estimates for June employment in Wisconsin. Private payrolls declined 11.7 thousand while total nonfarm payroll declined 13.2 thousand (0.5% and 0.5% respectively, using log differences), at seasonally adjusted rates. Civilian employment decreased 7.9 thousand (0.3%). (At annualized rates, these would be 6%, 5.8% and 3.3%, respectively). It is interesting to observe that none of these figures are cited in the text of the Wisconsin Department of Workforce Development press release. Instead, it notes:
Would Regulation of Libor Have Passed Senator Shelby’s Benefit-Cost Analysis?
Senator Shelby, Ranking Republican of the Banking Committee, has sponsored The Financial Regulatory Responsibility Act, which seeks to restrict implementation of Dodd-Frank, and require benefit-cost analysis for financial regulation. To quote Sen. Shelby: “American job creators are under siege from the Dodd-Frank Act.” [1] Now, it’s clear that British authorities have primary responsibility for regulating Libor (after all, the “L” in Libor stands for “London”). But I think it’s useful to consider this question because clearly similar concerns will arise in markets in the US sometime in the future.
High Inflation at the Gates?
The Federal Reserve needs to raise interest rates to stave off inflation, says Rep. Paul Ryan, R-Wis. “I’m worried they’re not going to pre-empt inflation,” the House Budget Committee Chairman tells CNBC.
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Whither China?
Recent economic reports from China are, at the least, mixed. The responses to Friday’s GDP report are illustrative.
May Temperatures, Economic Implications
With update (7/19) comparing global land/ocean temperature anomaly 2012 vs. 2010 and 2005
From NOAA:
The United States reported its warmest spring since records began in 1895,…
Data on Tax Rates, by Quintiles
Or, where have you gone, Todd Henderson?