Economists predict a 2020 recession; don't take it as gospel
Economists historically have had a terrible record of accomplishment in predicting recessions. This could be due in large part to the conflicting signals that oftentimes accompany an economic peak. For...
View ArticleTrump blames the Fed for market meltdown but could blame himself
It is said that success has many fathers, but failure is an orphan. That proved to be the case for the 2008-09 Great Recession. In the aftermath, nobody in the policymaking, financial or academic...
View ArticleThe economy may have peaked, but it's not a has-been
The swoon in equity prices in October and the cooling of real GDP growth to a 3.5-percent annualized pace in the third quarter (Q3) from a stellar 4.2 percent in Q2 have generated considerable...
View ArticleNewly split Congress can unite on one big issue: infrastructure
With Democrats winning a majority in the House of Representatives and with Republicans holding on to their majority in the Senate in Tuesday’s midterm election, two years of gridlock could well be in...
View ArticleTrump preps his scapegoat for the next recession: The Fed
On the eve of a two-day meeting by the Federal Reserve’s decision-making Federal Open Market Committee, President Trump took to Twitter to register his feelings about possible interest rates hikes:"It...
View ArticleFed Chairman Powell deserves our pity, not Trump's scorn
One has to pity Federal Reserve Chairman Jerome Powell. If there is one person who will undeservedly be publicly dragged over the coals by President Trump for the bursting of the stock market bubble,...
View ArticleJay Powell ignores the stock market at the economy's peril
In 2017, a key mistake of the Federal Reserve was to keep monetary policy too loose despite the strong increase in U.S. stock prices that took place that year.One now has to hope that current Fed...
View ArticleBe wary of the recession predictor that has a perfect track record
The unemployment rate tends to be a leading indicator ahead of economic downturns, but the series is also a lagging indicator ahead of economic recoveries.This means that the unemployment rate goes up...
View ArticleRecession predictions could become self-fulfilling prophecies
If you woke up tomorrow in an advanced economy growing at 3 percent, with an unemployment rate near a 50-year low, inflation stable around 2 percent and long-term government bond yields below 3...
View ArticleLow wage growth ensures this is an expansion in name only
Alongside the surprisingly weak jobs report issued last Friday, the Bureau of Labor Statistics reported on productivity. The real wage report is available, too.Economists have long been expecting that...
View ArticleWe must not turn recession fears into self-fulfilling prophecies
What does the Fed know that we don’t? That is the question that I have been asked the most over the past week. The Fed’s paradigm shift to a significantly more dovish stance has left everyone wondering...
View ArticleThe labor force brings some joy to the 'dismal science'
Economics is seldom lacking in bad news; it is the “dismal science” after all. But sometimes economists are pleasantly surprised. In fact we are in midst of an ongoing positive surprise in the U.S....
View ArticleThe flat truth on the yield curve and recessions
Alarm bells rang for many investors when the U.S. Treasury yield curve recently inverted for the first time in roughly a decade. On March 22, the yield on the 10-year Treasury bond fell slightly below...
View ArticleMeet the new slow-and-steady American consumer
When the Commerce Department reported 3.2 percent annualized U.S. GDP growth for the first quarter in late April, it caught pundits, academics and economists by surprise.January’s record government...
View ArticleUS breaks record for longest economic expansion
The U.S. broke its record for time without an economic recession Monday as it began the 121st consecutive month of gross domestic product (GDP) growth since the 2008 recession.The recovery, which began...
View ArticleThink of this economy as an elderly friend: Old age means coming death
I’m teaching macroeconomics to MBA students this summer and thinking about asking this question on the final:“We set a record in July. The U.S. economy has now gone longer without experiencing a...
View ArticleThe economy does not make Trump invincible
Bill Clinton aide James Carville once famously remarked that when it came to winning elections, it’s “the economy, stupid.” This dictum has led many observers to surmise that the currently strong U.S....
View ArticleEconomy lost in din of 2020 politics
There was never any question that the headlines in 2020 would be dominated by the presidential campaign. No one ever expected 2020 to be a year of “the economy, stupid!” Chairman Mao’s dictum “Put...
View ArticleWelcome to the fake recession
The stock market falls. Millions of people file unemployment claims. There's a historic drop in quarterly GDP. Consumer confidence nosedives. Production declines. Housing stalls. Oil collapses....
View ArticleA miraculous recovery is marked by the shortest recession on record
The economy is set to record the shortest recession in the 166-year history of the National Bureau of Economic Research’s (NBER) dating of business cycles. The principal indicator used to date business...
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