Still rising, so likely no recession as of June 2019.
The 16 Month-long Blip in Soybean Prices
On July 9, 2018, reader CoRev disparaged futures prices as accurate predictors of future spot prices for soybeans, writing:
no one has denied the impact of tariffs on FUTURES prices. Those of us arguing against the constant anti-tariff, anti-Trump dialogs have noted this will probably be a price blip lasting until US/Chinese negotiations end. We are on record saying the prices will be back approaching last year’s harvest season prices.
A Business-Cycle Mystery: Manslaughter or Murder?
If recoveries don’t die of old-age, then they either have “accidents” or they’re murdered. I’m not sure what a business-cycle accident is, but we can check what might have killed the recovery, should we enter a recession in 2020, as suggested by some forward looking financial indicators. I’ll look at investment spending, a forward looking variable, highly sensitive to interest rates, and the outlook for economic activity and uncertainty.
Estimated Recession Probabilities, August 2019
Based upon July 2019 spreads
Equipment Investment, Capital Goods Imports, and the Impending Slowdown…Again
Equipment investment is flat; capital goods imports (aside from aircraft and computers) declining 4% per annum.
Guest Contribution: “Political Pressure on Central Banks”
Today we are fortunate to present a guest post by Carola Binder at the Department of Economics at Haverford College. Twitter: @cconces
Guest Contribution: “Let’s Forget about 2% Inflation”
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 in Project Syndicate on July 25th.
Economy still growing, but…
The Bureau of Economic Analysis announced today that U.S. real GDP grew at a 2.1% annual rate in the second quarter of 2019. That’s pretty near the 2.2% average rate since the recovery from the Great Recession began in 2009:Q3.
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BdF/AMSE International Macro Workshop: Business Cycles, Uncertainty, China, Macro Policies, and Exchange Rates
Today, we are pleased to present a guest post written by Laurent Ferrara (Banque de France), Céline Poilly (AMSE) and Daniele Siena (Banque de France). The views presented represent those of the authors, and not necessarily those of the institutions the authors are affilliated with.
“Across-the-Board Tariffs on China with Retaliation and Federal Spending Create Over 1 Million Jobs in Five Years”
The Coalition for a Prosperous America publishes another study imbued with “secret sauce” structure…From the “working paper” (more akin to a press release):
Specifically, we introduce the effects of Chinese retaliation with tariffs on US exports to China; we add the effects of the US Department of Agriculture’s (USDA) programs to support farmers and food processors negatively affected by Chinese retaliation; and, we add the impact of the US government spending the revenue generated by the China tariffs. We find that Chinese retaliation reduces the benefit to the US economy by 14 percent, but the net benefit remains large. The USDA programs provide relief to the agricultural industry and restore the net benefit to almost the same level as before the retaliation. Finally, we look at the impact of the government reinvesting the tariff revenue in the US economy by boosting government spending…