Reader JohnH asserts:
LNG is the US’ third largest export and fastest growing.
How Long the Dollar Upswing?
One of the seminal empirical exchange rate papers is Charles Engel‘s and Jim Hamilton‘s “Long swings in the exchange rate: are they in the data and do markets know it?” (AER, 1990). Think about it – while one often can’t reject the null hypothesis of a random walk in the exchange rate (using typically low-powered tests), the typical floating exchange rate sure doesn’t look like a random walk. What does a Markov switching model applied to the US broad trade weighted real value of the US dollar (instead of bilateral against Deutsche mark, French franc, British pound).
The External Environment and Prospects for GDP Growth
As noted by Jim in his post on the 2022Q3 GDP release, exports and imports accounted (mechanically) for more than 100% of 2022Q3 GDP growth:
Guest Contribution: “Why Do Americans Vote for the Extremist Party?”
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. An earlier version appeared at Project Syndicate and LA Times.
Not a recession … yet
The Bureau of Economic Analysis announced today that seasonally adjusted U.S. real GDP grew at a 2.6% annual rate in the third quarter. That’s close to the historical average (3.1%), and is a welcome sequel to the two quarters of falling GDP with which we started the year.
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On the Eve of the Q3 GDP Release: Coincident Index and GDPNow
Jim will have more in a few hours, but for now, here is GDPNow as of 10/26, compared to monthly GDP (as of October 4), and the Philadelphia Fed Concident Index.
Industrial Production in the Recession of 1920-21, Compared to a Hypothetical 2022 Recession
Here’s industrial production (Fed, Miron-Romer) index during the 1920-21 recession, as reader Steven Kopits thinks this is the template for a conjectured current ongoing recession (or incipient – the conjecture keeps on changing).
Reminder: “Recession” Is Not the Same as “People Are Unhappy”
Reader Steve Kopits, after again asserting that VMT, gasoline consumption, GDP all imply recession in H1 2022, writes as his clinching argument “And apparently, the public is none too enamored of macro indicators, either, given recent polling heading into November.” I agree, the public is not terribly happy, as evidenced by say the U Michigan Sentiment indicator. But that’s not to say we’re in a recession.
Kathryn Dominguez at EconoFact: “Global Repercussions of the Strong Dollar”
From the memo :
Two Days before GDP Q3 Release: What Remains of the 2022H1 Recession Thesis?
Monthly indicators followed by the NBER Business Cycle Dating Committee, plus GDP and GDO, plus IHS-Markit (nee Macroeconomic Advisers) monthly GDP: