(With updates)
From WSJ Washington Wire:
Mark Zandi, chief economist of Moody’s Analytics, said the market impact of failing to raise the $14.29 trillion debt ceiling by Aug. 2 could become severe by late July.
Author Archives: Menzie Chinn
Forecasting Commodity Prices
With commodity prices exhibiting wide fluctations over the past few years, it’s no wonder that many are interested in determining what procedure best forecasts. A recent New York Fed blog post by Jan Groen and Paolo Pesenti tackles this issue. In a horse race between various economic, time series, and futures-based approaches…
there is no obvious winner. Information from large panels of global economic variables can help, but their forecasting properties are by no means overwhelming. It all depends on the choice of the specific index and the forecasting horizon. …
Dispatches (XIV): “Walker cancels budget bill-signing at firm run by felon”
From the Milwaukee Sentinel Journal yesterday (h/t TPM):
Gov. Scott Walker has called off plans to sign the 2011-’13 budget bill at a private Green Bay-area company run by an executive with eight felony convictions, a spokesman announced today.
Yuan Schizophrenia
Or more on China-U.S. exchange rate pass through
Tuesday’s Wall Street Journal illustrated the conflicted nature of American views regarding real yuan appreciation. The front page article by Hilsenrath, Burkitt and Holmes argued “Change in China Hits U.S. Purse”. On the back page of the C section was a countering article, “No appreciation for the rising yuan”, by Orlik, that noted the moderate impact on prices of imported goods from China.
And Policymakers Are Proposing to Withdraw Stimulus?
Guest Contribution: The Fiscal Stimulus in 2009-11
Trade Openness, Fiscal Space and Exchange Rate Adjustment
Today, we are fortunate to have as guest contributors Joshua Aizenman of UC Santa Cruz and Yothin Jinjarak of the School of Oriental and African Studies of London University.
This post draws upon Aizenman and Jinjarak (2011).
When Price Does Not Clear the Market
And other non-Neoclassical tales
Finance and Development has a profile of one of my teachers, Nobel Laureate George Akerlof, written by Prakash Loungani. Akerlof’s views are critical to recall in these times when some individuals think supply and demand are sufficient to answer all policy issues. Akerlof’s research highlighted the role of information asymmetries that prevent prices for setting quantity demanded equal to quantity supplied. From the article
In Order to Know Where You Are Going…
…you need to know how you got where you are. From the abstract to a working paper by myself, Barry Eichengreen and Hiro Ito, entitled A Forensic Analysis of Global Imbalances:
We re-examine the determinants of current account balances applying updated data to the framework based on Chinn and Ito (2007). …
Growth Forecasts and Informational Rigidities
From a new IMF working paper by Prakash Loungani:
We document information rigidity in forecasts for real GDP growth in 46 countries over the past two decades….
May Employment Report
The Employment Situation release for May was not entirely a surprise, given Jim’s post yesterday, but contained unwelcome news nonetheless. WSJ RTE quotes Stephen Stanley of Pierpoint Securities thus: “…consider me worried”.