What may unlock consumer spending
While retail sales have been rather weak, key elements of consumer spending on services, including housing, are growing.
Category: Macroeconomics
Old thinking in China raises doubts
A recent public spending plan in China suggests authorities may be revisiting old habits.
Why the economy looks solid
Despite jittery global markets, we believe consumer and trade data point to a balanced and healthy U.S. economy.
The U.S. takes the policy road less traveled
The difference between U.S. and European economic growth trajectories may come down to policy paths taken or not taken.
Fed weighs addition to policy toolbox
The Fed may have a desire to switch to a different monetary-policy regime, one that would involve using a permanent balance sheet.
In rising economy, wages are a wild card
By the end of the first quarter, U.S. economic data began to improve somewhat from what had been winter-related economic weakness. After disappointing results from various sectors of the U.S. economy, higher auto sales, improving business activity, and overall job creation that is generally in line with forecasts have helped shape expectations for a comparatively
Is the Fed fighting the last war?
In recent posts, we have approached the problem of the outlook for interest rates by outlining the questions that surround the potential growth rate of the U.S. economy. It is established that this rate is heavily influenced by conditions in the labor market. New workers are joining the labor force at a slower pace than
If the economy grows, will workers come back?
A look at recent trends in the U.S. economy suggests that the potential U.S. growth rate is declining. The first reason for this conclusion is that investment has been so weak recently, which means the country’s capital stock has been growing only very slowly. Without investment growth, an economic growth cycle tends to be short,
How yields can change in a “normalizing” economy
As the Federal Reserve plots its actions and communications strategy for the gradual normalization of monetary policy, fixed-income investors face the challenge of anticipating the future course of interest rates. Economic growth influences interest rates The long-term “equilibrium” interest rate of an economy is intimately linked to the economy’s overall growth potential when it is