Demented Things People Write

From reader JBH today:

Trump may well be Patton reincarnated as he was born ½ earth revolution after Patton nearly to the day. Enemies of America off balance and greatly confused by Trump’s classic Art of War style. Massive infrastructure rebuilding project coming. Trump will build that… along with the Wall.

I have seen this abbreviation “TDS” for “Trump Derangement Syndrome”. I’ll just say seems like plenty of people have just plain “DS”.

This is by way of alerting readers to the following: I will not censor any comments on reincarnation, George S. Patton, and sealed indictments. However, comments giving credence to Q-anon, racist jokes and misogynistic observations, and arguments that there were indeed “fine people on both sides” of the Charlottesville protests of 2017 will be censored.

 

Of Chinese Swine, US Hog Exports, Soybean Prices, and News

Soybean prices continue to plunge (July ’19 futures). Some have argued that decreased demand for soybeans, due to the ongoing African swine fever epidemic in China. The April 9th USDA FAS report contained information on both this, and soy market conditions. If decreased demand for soybeans was due to news about Chinese swine stocks, we would have expected rising US hog and declining soy prices. Yet hog prices have fallen for most of the time since then.

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Crazy Things People Write

Reader Zi Zi writes:

Higher short rate actually precedes better [US GDP] growth (not lower): GBP3M

I … don’t … think…so.

Figure 1: Libor 3 month based on British pound (dark blue, left scale), four quarter growth rate of US real GDP (red, right scale), both in %. NBER defined recession dates. Source: IBA, BEA via FRED, NBER, and author’s calculations.

Granger causality (2 lags) test fails to reject US growth rate causes Libor; rejects Libor causes US growth rate.

 

Equipment Investment, Capital Goods Imports, and the Impending Slowdown

Almost exactly 12 years ago, I noted the decline in equipment and software investment and the contemporaneous plateauing of capital goods imports, and repeated my worries in mid-June. At the time, I didn’t dare suggest an impending recession. Jim Hamilton (in July) warns “All of which is a reminder that the latest GDP numbers do not prove that we’re out of the woods yet” as the recession probability indicator rises to 26.2%.

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