And what we can do about it
From Macroeconomic Advisers and e-forecasting, some recent reads on the macroeconomy:
Author Archives: Menzie Chinn
Exports in the Recovery (II)
Following up on my previous post on the export contribution in the recovery (averaging 2.6 ppts since the trough), here are some additional observations. First, export growth in the current recovery has been substantially greater from the trough than in the last three recoveries.
I Killed Some Brain Cells Today
I ran a regression of ΔY on ΔX and ΔZ, over the 1967Q1-2011Q3 period. I found that the coefficient on ΔX was 0.007, and on ΔZ was -0.080. Neither coefficient was statistically significant at conventional levels, so I concluded that neither affected ΔY.
Has Austerity Brought a Boom in the UK?
Or Generalissimo Francisco Franco redux.
In “UK: Economic growth, double-dips and the PMI,” (G. Buckley, Deutsche Bank, Nov. 4, 2011, not online):
UK GDP grew by 0.5% qoq in Q3, but the position the economy is in is now officially worse than it was in the aftermath of the Great Depression. Add to this the weakening in the composite PMI
survey for October (particularly the manufacturing report), also published this week, and escalating risks for a sharper euro area recession, and the stage possibly looks set for a much bleaker
picture by the end of this year/start of 2012.
Guest Contribution: “What can exports tell us about the economy?”
Today, we are fortunate to have Jay C. Shambaugh of the McDonough School of Business at Georgetown University as a guest contributor.
There has been considerable debate lately about why the U.S. economy continues to struggle. Some — notably economists on the right and some Federal Reserve Bank Presidents — have argued that concerns about future taxes and regulation are preventing American businesses from investing and hiring. Other economists have argued that we have inadequate aggregate demand in the economy and that explains slow GDP and employment growth — not fear of future government policy.
Photos from a (Book) Forum
From Prakash Loungani’s blog:
A standing-room only audience at the IMF last month heard a presentation by [Menzie] Chinn and [Jeffry] Frieden [on Lost Decades], along with comments from Diane Lim Rogers (Concord Coalition), Gail Cohen (Joint Economic Committee) and Simon Johnson (MIT and Peterson Institute). The forum was moderated by Nobel Prize-winner George Akerlof.
“Lurking in the Shadows…”
“…the Risks from Nonbank Intermediation in China,” by Nigel Chalk in IMFDirect.
Many China-watchers looked on in awe in 2009 as the government’s response to the global financial crisis unfolded, causing bank lending as a share of the economy to expand by close to 20 percentage points in less than a year. …
Exports in the Recovery
Just a quick observation today, elicited by a question: what has been a consistent source of growth since the recovery began?
“An Examination of U.S. Dollar Declines”
That’s the title of a blogpost by Roosevelt Bowman and Jan J.J. Groen at the New York Fed. The write:
…we examine the role of market uncertainty and currency risk premia in the pace and size of episodes of dollar weakness since 1991. We find that the most recent bout of U.S. dollar declines largely can be attributed to the recovery in global economic activity from the most recent recession.
CBO on Income Inequality, and Interpreting OWS
Tabulating Inequality Trends
The CBO released a report on income inequality earlier this week. This means that the “inequality deniers” are having a more difficult time arguing that widening spreads an wages, compensation, or overall income are merely statistical artifacts dreamt up by liberals (see e.g. here). What is of most interest is (i) real after-tax income of the top 1 percentile has risen about 275%, and (ii) the pre-transfers/pre-tax income share of the top 1% has increased most profoundly.