Economy

We are only seven months into Donald Trump’s presidency. And I think we can call it a failure. I’ll have a lot more to say on that momentarily. But I want to flag this as not being a dealbreaker for the US or global economy because people…

I see that Dartmouth economics professor Danny Blanchflower is talking about slack in the US labour market because he believes the Fed is premature in assessing its full employment mandate as fulfilled. I have a few thoughts on this issue I…

The Fed should not use rate policy to deal with financial stability concerns. The Fed should concentrate rate policy on its dual mandate and that’s it. Instead the Fed should use non-rate mechanisms to exert regulatory control. The worst…

In the aftermath of the shale oil bust that sent the US economy to stall speed in 2015, growth has rebounded, but only to a sort of 2%ish level. Continued low inflation insures further low nominal GDP growth aka secular stagnation. But so…

When you look at how markets are positioned, it’s clear that a lot of people see continued low growth for years to come – a veritable Japanification of the US economy. I hope this is one of those times that markets are wrong. But I am not…

Only during the Great Recession did nominal GDP break out of a tight range – and then, it did so to the downside. We are nowhere near the top of the range now, nor should we expect to be anytime soon.

The Bank of England kept its key policy rate unchanged at a record low 0.25% . Three dissents show how a weak currency and rising inflation are making it harder to keep rates low. The worst case scenario is an inflationary recession, which…

While the economy in the UK was favourable for Corbyn last week, I don’t think the economics support populism elsewhere in Europe right now. Everywhere you look, the populists are in retreat in Europe. And that will give the EU breathing…

There are several threads I want to comment on in the wake of the UK general election. And from an economic standpoint, the conclusion that follows is that austerity in the UK has now lost its appeal politically. It also means lower yields…

The labor market in the US is tighter today than it was at the same period last year. This, in conjunction with the last jobs report, gives cover to the Fed to hike rates in June.