Our analysis of TFP — Total Factor Productivity — gives us confidence that innovation can sustain long-term economic growth at pre-2008 levels.
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
With the automatic spending cuts, or sequestration, required by the Budget Control Act of 2011 still on track to go into effect starting Friday, March 1, we believe it’s important to keep the full impact in perspective. Even if we do go into a sequestration mode in the United States, or get bogged down in
This fall, the Federal Reserve announced its widely anticipated third round of quantitative easing, commonly referred to as “QE3.” The aim of this latest initiative is to keep interest rates low in order to encourage investor risk taking and investment in the economy. Like the two rounds of easing that preceded QE3, the Fed will
The Fed has taken extraordinary measures since 2008 to help keep long-term interest rates low through two rounds of quantitative easing, known as “Operation Twist,” followed by a third round of easing that targets the mortgage-backed securities market.