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.
Why Stop at $12 Billion?
The losses incurred by the ag sector might already exceed the size of the ag sector bailout proposed by Trump. One constraint is the WTO.
Credit: Russell Hodin, via Ian Bremmer. [added 7/26, 1:34PM Pacific]
Continue reading
At Business Cycle Frequencies, Macro Dominates in Trade Flows
Just a reminder, the Chinese have an instrument we do not; the question is whether they dare use it:
Pork Exports to China Zero’d Out?
According to Prof. Mary Lovely, trade economist at Syracuse University:
“In recent weeks, the U.S. Department of Agriculture has reported zero weekly export sales of pork to China. … So our exports to the country have pretty much collapsed.”
Is California in Recession? (Part VIII)
Back in mid-December, Political Calculations asked if California was in recession.
Going by these [household survey based labor market] measures, it would appear that recession has arrived in California, which is partially borne out by state level GDP data from the U.S. Bureau of Economic Analysis. [text as accessed on 12/27/2017]
The release of the 2018Q1 state GDP figures provides an opportunity to revisit this question — it’s likely no recession occurred.
Trump Provides Another Event Analysis: Pandering to the Farmers
USDA announced some $12 billion of suppport for agriculture today (partly via resurrecting the activities of the Commodity Credit Corporation (CCC). Besides it being potentially WTO-inconsistent (I think it fits into at least the amber box), one characterization of the measure is:
“It would be a band-aid – how do you decide who gets what?”
A Study in Contrasts: Four States Q1 GDP
According to data released today, Wisconsin ranks 40th in the first read on 2018Q1 state GDP growth. Washington state ranks first (even though it’s ranked 37th for economic outlook in the 2018 ALEC-Arthur Laffer-Steven Mooore-Jonathan Williams Rich States Poor States).
Not Quite Twin Peaks
Nominal asset prices, including S&P500 and home, continue to rise, but real prices have not regained prior levels (S&P500) or have plateaued (home prices).
PoMo Micro
A reader writes (in discussing the Taylor rule):
Like [the] price elasticity of demand, we have an analytical approach that is appealing in theory, but so ill defined as to be useless in practice.
Wow. I haven’t read anything like that since I read Anti-Samuelson. Believe it or not, this was written by a person who purports to do policy analysis.
Taylor Rule Implied Rate, Trump-Annotated
“I don’t like all of this work that we’re putting into the economy and then I see rates going up.”
and a tweet on Saturday:
Tightening now hurts all that we have done.