Wisconsin real personal income in Q3 is less than it was a 2015Q4, and since 2011Q1, cumulative nominal income is 5% lower than that in Minnesota (and the US). Wisconsin GDP growth through Q2 lags Minnesota and US.
Figure 1: Wisconsin GDP (blue) and personal income deflated by US PCE (red) in mn. Ch.2009$, SAAR, both on log scale. NBER defined recession dates shaded gray. Source: BEA, and author’s calculations.
Source: PredictIt accessed 12/21.
Closing price 34 cents. I assume this means that there is 1/3 chance that President Trump will fire Mueller within the next 6 months. Not surprising given the President’s rabid attacks on the FBI.
(Some) defenders of the Tax Cuts and Jobs Act as passed argue that tax cuts for households will be extended, rather than disappearing by 2027. What does that mean for debt?
Source: CRFB. Note: Differs from gross debt by netting out intra-Federal government holdings.
CRFB estimates FY2019 deficits will be $1.1 trillion.
Fortunately, the President has stated he will not sign a tax bill that he believes will increase the budget deficit.
I tire of hearing people who had one (or no) class in economics saying “the magic of the marketplace” will lead to the optimal outcome. What teaching finance has made me realize is that information problems are rife in many economic interactions. And one can’t be a student of currency crises without being even more convinced. The paper by Stijn Claessens and Ayhan Kose, “Macroeconomic Implications of Financial Frictions: A Survey” is a must-read for those who want to keep up with the literature. It has this fantastic schematic:
Remember when critics wailed about the high cost/per job saved and low multipliers likely under the American Recovery and Reinvestment Act? The same set of people do not seem very bothered at all by the relatively small implied output impact of the TCJA produced by any of the reasonable modelers.
What prompted this question was seeing this release from Senator Portman (as well as this tweet) extolling the Tax Cuts and Jobs Act, appealing to the opinion of “137 economist”. Here’s the list:
The MacIver Institute has released new projections of the impact of the Tax Cuts and Jobs Act on Wisconsin:
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It looks even worse than shown in this post.
Figure 1: Kansas real GDP in mn.Ch.2009$ SAAR (black) and log linear deterministic trend based on 2005-2010 (red), a log difference stationary fit* (green) all on log scale. Source: BEA and author’s calculations.
