Today, we present a guest post written by Jeffrey Frankel, Harpel Professor at Harvard’s Kennedy School of Government, and formerly a member of the White House Council of Economic Advisers. A shorter version appeared at Project Syndicate.
Guest Contribution: “The Fed Is Following the Taylor Rule”
Today, we present a guest post written by David Papell and Ruxandra Prodan, Professor and Instructional Associate Professor of Economics at the University of Houston.
PCE Inflation – Headline, Core, Trimmed Month-on-Month and Instantaneous
Core PCE y/y 4.7% vs. 4.3% consensus, headline 5.4% vs. 5.0%.
Business Cycle Indicators – Spending, Income, Sales
Nominal consumption above consensus (1.8% m/m vs. 1.3%). Personal income was 0.6% m/m, vs. consensus 1%. The NBER BCDC looks at real consumption and real income ex-current transers for conjunctural analysis. These are plotted below, along with with real manufacturing and trade industry sales.
GDP, and Guesses about GDI, GDO
We don’t have estimates of GDI, but if we assume nominal net operating surpluses remain constant at 2022Q3 levels ($6.2 trn out of $26 trn GDI SAAR), then we have the following picture.
Dealing with Seasonality with 12 Month Changes: the QCEW
(If you’re wondering about estimating seasonals — and you might be right wonder — then here’s the alternative.) QCEW data are not reported on a seasonally adjusted basis, which makes comparison with the other regularly reported BLS series, based on surveys, difficult. One way to address this issue, while sacrificing a more current perspective, is to use 12 month changes. Here is the QCEW series compared against two others measures of nonfarm payroll growth.
Employment Levels and Cumulative Changes: Tales from the QCEW
Quarterly Census of Employment and Wages data were released today. Recalling that some observers were claiming a recession occurred in 2022H1 (and/or 2022Q2) because household survey and QCEW employment numbers had flattened. With revised Q1 and Q2 data and new Q3 data, we have the following pictures of levels for nonfarm payroll employment and private nonfarm payroll employment.
For Some People, There’s a Single Solution to Every Problem
Ron Paul, on ending the conflict in the Ukraine. From CounterCurrents:
Do Declining Imports Signal an Imminent Recession?
Maybe. Maybe not. Some reasons to wonder.
Trade and Financial Policy Openness in EMDE’s, 1975-2019
Working on another project, I found this interesting correlation between the IMF’s “Measure of Aggregate Trade Restrictions” (MATR) (Estafania-Flores, Furceri, Hannan, Ostry and Rose (2022)) and the Chinn-Ito (JDE 2006) measure of financial openness (KAOPEN).