Here is the state of play for US tariffs. We’re a developing country!
As Mr. Trump’s trade war lumbers on, with American consumers bearing the bulk of the burden thus far, it’s useful to review the facts regarding the war. Here are the EconoFact articles on trade policy.
That’s the title of an article in Bloomberg:
Shelton, who’s served as an informal adviser to Trump, holds a Ph.D. in business administration with an emphasis on finance and international economics from the University of Utah.
I just finished a new paper on current U.S. monetary policy operating procedures. Here’s the abstract:
The Federal Reserve characterizes its current policy decisions in terms of targets for the fed funds rate and the size of its balance sheet. The fed funds rate today is essentially an administered rate that is heavily influenced by regulatory arbitrage and divorced from its traditional role as a signal of liquidity in the banking system. The size of the Fed’s balance sheet is at best a very blunt instrument for influencing interest rates. In this paper I compare the current operating system with the historical U.S. system and the procedures of other central banks. I then examine strategies for transitioning from the current system to one that would give the Federal Reserve better tools with which to achieve its strategic objective of influencing inflation and output.
Here’s a link to a video of my presentation of the paper at a conference at Stanford last week.
I have been remiss in not bringing people’s attention to this purge. From Politico:
Economists in the Agriculture Department’s research branch say the Trump administration is retaliating against them for publishing reports that shed negative light on White House policies, spurring an exodus that included six of them quitting the department on a single day in late April.
If you do not see a pattern in the bullying of Census, the extreme nontransparency of rules at BIS (Bureau of Industry and Security), and the attempt at Board-stuffing at the Fed, then you are blind.
“Re-run” is an archaic phrase from my generation. It means to replay a previously recorded and broadcast television show. Here, this “rerun” seems appropos. I think that the cost to Xi of backing down is even greater given Trump’s tariff threat came close to the day of the 100th Anniversary of the May 4th Movement — a sensitive occasion for the CCP. From an August 2018 post.
Notable differences. US GDP fundamentals less robust than in August. Chinese growth fundamentals (in the short run) are stronger. Remember this despite the fact that that Liu He is joining the negotiating team coming to Washington, D.C.
Today, we are pleased to present a guest contribution written by Eric Sims and Jing Cynthia Wu (both from the University of Notre Dame), based on their paper of the same title.
Robust GDP growth, employment rising on pace, perceived recession risk declining… as in this headline. The latest issue of the Economist has an article entitled Fears of recession have faded. But I’m reminded that Campbell Harvey, who wrote early papers on the subject of yield curve predictors, relies on the 5yr-3mo spread (for growth, not recession). And that implied specification signals 44% probability of recession in 2020M04.
Figure 1: Real proprietor farm income with inventory valuation adjustment and capital consumption allowance (dark blue), and 4 quarter trailing moving average (red), both in billions of Ch.2012$, SAAR. Deflated using GDP deflator. Source: BEA 2019Q1 advance release, and author’s calculations.
That’s from Macroeconomic Advisers today. Turns out a bunch of monthly indicators have recently been released, including today’s employment report. Here are some key ones followed by NBER’s Business Cycle Dating Committee (BCDC).
