Author Archives: Menzie Chinn

Employment in March: Comparisons across Measures, Time, and Levels vs. Growth

The March employment figures have almost universally been hailed as evidence of a strong labor market, given how the announced value exceeded expectations, and the fact that previous months values were revised upward (WSJ1, WSJ2, Reuters, Bloomberg; contrarian opinion at Big Picture, Capital Spectator). (Jim Hamilton has already discussed how likely these figures are to be revised, in light of other complementary data.) Without disagreeing, I think it behooves us to consider other ways of looking at the data.

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Maybe we can’t count on exorbitant privilege/dark matter/manna from heaven…

The new conventional wisdom is that the return foreigners obtain on U.S. assets is less than the return U.S. residents obtain on foreign assets. And that this means that the U.S. can build up a bigger foreign debt than traditional analyses; I’ve been skeptical [1], [2]. Now, we have more reason to ask how robust is the finding of a durable earnings differential in favor of U.S. investors?

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