May 9, 2023
At its May 2023 meeting, the Federal Reserve’s FOMC announced it was raising the Fed Funds Rate by 25 bps to a range between 5.00% and 5.25%. This was widely expected to be the last in a series of rate hikes that began in March 2022. The Fed’s statement can be found here. This chart offers […]
February 20, 2015
I have a new article out in Foreign Policy magazine: It’s Time to Kick Germany Out of the Eurozone Why the anchor dragging down the European economy isn’t Athens — it’s Berlin. Last year, Germany racked up a record trade surplus of 217 billion euros ($246 billion), second only to China in global export dominance. To some, this made Germany a […]
May 9, 2023
This post summarizes a Twitter thread I posted on May 7, 2023. 1. A short Q&A about the debt limit. First of all, where did it come from? 2. Article I, Section 8 of the Constitution assigns Congress the power to incur debt. Prior to World War I, it directly authorized each issuance of government […]
May 7, 2023
US real GDP in 1Q23 grew at an annualized rate of +1.1% q/q, slower than the 2.0% expected. This was down from +2.6% in 4Q22. The composition of real GDP growth in 1Q23 was: +1.1% = +2.5 consumption, +0.1 business investment, -2.3 inventories, -0.2 housing, +0.8 government spending, +0.1 net exports. In contrast, the (revised) […]
May 5, 2023
The US federal budget deficit for the calendar year 2022 was $1.42 trillion, down significantly from $3.35 trillion in 2021. The US federal budget deficit as a percentage of GDP declined back to 5.4% in 2022, down from 11.9% in 2021 and 14.9% (which was the highest figure since World War II). The Congressional Budget […]
May 4, 2023
The U.S. trade deficit in goods and services declined to $64.2 billion in March, after reaching an all-time high in March 2020. The trade deficit for Q1 was $203.5 billion, -27.6% smaller than a year ago. In 2021, the annual U.S. trade deficit hit a new record at $845.0 billion. Higher tariff policies under the […]
May 3, 2023
The following are diffusion indices, based on business surveys, which means that >50 indicates expansion and <50 indicates contraction, and 50 indicates no change. A larger or small number indicates breadth, not intensity, among survey respondents. ISM Manufacturing Index rebounded +0.8 points in April to 47.1, but remained in its 6th straight month of contraction. […]
April 18, 2023
US industrial production rose +0.4% m/m in March, up +0.5% from a year ago, recovering from a modest drop in 4Q22. For Q1 as a whole, production was flat q/q, up +1.0% from a year before. Total industrial capacity utilization rose slightly to 79.8% in March. US manufacturing output (a subset of industrial production) fell […]
April 18, 2023
US consumer prices (CPI) rose +0.1% m/m in March, up +5.0% from a year ago. This is down steadily from a peak of +9.0% y/y last June. Core CPI (excluding food and energy) rose +0.4% m/m in March, up +5.6% from a year ago. This is down from a peak of +6.7% y/y last September, […]
April 18, 2023
US retail sales fell -1.0% m/m in March, declining for the second month in a row. Sales were up +2.9% from a year ago, but that is not adjusted for inflation. Given that consumer inflation was running at +5.0% y/y in March, this indicates that real sales are actually down. It’s worth noting that sales […]