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. He was a member of the NBER’s Business Cycle Dating Committee for 25 years, with his term ending last fall. A shorter version appeared in Project Syndicate and in The Guardian.
As of today, here are key monthly indicators followed by the NBER Business Cycle Dating Committee:
Figure 1: Nonfarm payroll employment (blue), industrial production (red), personal income excluding transfers in Ch.2012$ (green), manufacturing and trade sales in Ch.2012$ (black), and monthly GDP in Ch.2012$ (pink), all log normalized to 2019M02=0. Source: BLS, Federal Reserve, BEA, via FRED, Macroeconomic Advisers (5/29 release), Bloomberg, and author’s calculations.
The NBER Business cycle Dating Committee has dated the most recent peak at February 2020 for monthly data, and 2019Q4 for quarterly. Jeffrey Frankel describes the reasoning for this date.
Q2 nowcast from Atlanta Fed is -48.5% (6/9), from NY Fed is -25.9% (6/12), St. Louis Fed is -38.9%(6/12), all SAAR. IHS Markit is -37.4% as of today.
From The Hill:
Sharp increases in the number of coronavirus cases diagnosed in states across the nation have some local elected officials considering pauses in reopening their economies.
The rising number of cases are hitting hardest in Sun Belt states like Arizona, California, Florida and Texas. All four of those states reported their highest single-day increase in the number of confirmed cases over the weekend.
Officials have also pointed to a troubling trend in the number of people who must be hospitalized for treatment, raising anew the frightening prospect of an overwhelmed health system. …
From Goldman-Sachs today:
Source: Goldman-Sachs, “Global Economics Comment: Tracking Coronavirus,” June 13, 2020.
Today, we’re fortunate to have Giovanni Pellegrino (Aarhus University), Federico Ravenna (Danmarks Nationalbank, University of Copenhagen, HEC Montreal, CEPR) and Gabriel Zullig (Danmarks Nationalbank, University of Copenhagen) as guest contributors. The views expressed represent those of the authors, and do not necessarily represent those of Danmarks Nationalbank , or any other institutions the authors are affiliated with.
Today, we’re fortunate to have Willem Thorbecke, Senior Fellow at Japan’s Research Institute of Economy, Trade and Industry (RIETI) as a guest contributor. The views expressed represent those of the author himself, and do not necessarily represent those of RIETI, or any other institutions the author is affiliated with.
Today, we’re pleased to present a guest contribution by Rob Fairlie (UC Santa Cruz).
Today, we’re pleased to present a guest contribution written by Laurent Ferrara (SKEMA Business School and International Institute of Forecasters) .
The Golden Rule: Understand…your…data
The Bureau of Labor Statistics announced Friday that 2.5 million more Americans were working in May than in April. That’s the biggest monthly increase since 1946, both in terms of the number of workers and as a percentage of the workforce. The unemployment rate dropped from 14.7% in April to 13.3% in May, the biggest monthly drop since 1950. All this is very good news. But there are also indications that we are in a deeper hole than the headline numbers suggest. Here I explain why I believe the true unemployment rate in May was a number more like 19.8%.
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