The Pandemic Caused Significant Economic Impacts; Not All Inflation Is Related
Over the last several blogs, we have opined that the pandemic hasn’t changed the economy’s potential growth path. The chart shows GDP growth rates beginning in the mid-1990s (with the Atlanta Fed’s +1.3% Q3/2021 forecast). The horizontal line shows a 2% growth level. Note that the left-hand side of the chart shows much higher growth than the right-hand […]
The Economy Has ‘Recovered’ – Anemic Growth To Follow
The September jobs report was filled with cross-currents, some showing possible economic weakness, some showing strength. This makes the Fed’s job exceedingly difficult. Is the economy strengthening or weakening? What’s the correct monetary policy prescription? “Taper” asset purchases? Raise interest rates? Since September payrolls were so ambiguous, perhaps October’s (which will be available to the Fed prior to its November meeting) […]
For Nine Million, Unemployment Benefits Have Suddenly Ended
The Economic Implications One of the major Wall Street investment houses recently lowered their Q3 GDP growth rate from 6.5% to 2.9% (!!), apparently realizing that two-thirds of the quarter was history, that the data have all been weakening (like August auto sales), and that the fiscal stimulus (helicopter money) was now in the rear-view […]
A Softening Economy Will Be Buffeted by Stimulus Withdrawal
While the story of the week was the big “miss” in Nonfarm Payrolls, most of the incoming data continue to be much softer than the markets or financial media let on, as they continue to ignore the implications. The chart above shows U.S. vehicle sales beginning in 2015. Note the steady sales levels until the […]
Delta-Variant, Soft Data Bode Ill for Near-Term Growth
The markets waited all week for Fed Chair Powell to speak at the Kansas City Fed’s Annual Jackson Hole Symposium. Due to the Delta-variant, like many other business meetings, this one was held virtually. There was growing market concern that Powell would turn somewhat more hawkish, especially since some Regional Fed Presidents appear to have […]
Inflation Is Fading; So Is The Economy; But Jobs Will Grow
The “inflation” story has now moved to page two, not because it isn’t still the financial media’s mantra, but the disaster of the Afghanistan exit has taken its place. We don’t think it will make its way back to page 1. The reason: the burst of economic activity, for the Q1 and Q2 economic reopenings, […]