CERF Blog

The February United States jobs report sent the equity markets up this morning while respected commentators like Edmund Phelps, (Columbia, Economics Nobel in 2006), remark that they worry that the “recovery” might not have legs. It always a bit odd to discuss growth that is less negative but that is the situation we are in… Read more

A lot of people who watch trade flows think that the United States is making a mistake by losing its manufacturing activities to other countries. They recognize that other countries can provide some manufactured goods at lower cost than the United States, lowering costs for consumers, and they recognize that free trade levels the playing… Read more

Data released today reveal a United States economy that remains unsettled. Mass Layoffs The Bureau of Labor Statistics’ report shows a 2 percent uptick in January seasonally-adjusted mass layoffs from December. The jump in mass layoff initial claimants for unemployment insurance was even larger at 19 percent over December. Gross Job Gains This report, which… Read more

Prices The January Producer Price Index (PPI) data released yesterday February 18, appeared to show that price pressures were building up again with finished goods prices rising 4.6 percent over 12 months ago, and rising 1.4 percent over the prior month. The January Consumer Price Index (CPI) data, released today, showed that the all-items inflation… Read more

Today’s not-much-noticed Industrial Production data release showed that January’s Industrial Production was up a bit from December. This report also indicated that capacity utilization increased a bit in January from December. Notice, charts below, capacity utilization and industrial production have been improving for 6 months now. This is enough to indicate a trend, indicating that… Read more

The January United States jobs report contains mixed results that, to us, provide hints of a recovery to come. More on the recovery later. The bad news from the jobs report first: long term unemployed persons, (those who have been unemployed for 27 weeks or longer), climbed by about 500,000 to just under 6.5 million… Read more

David Ricardo, the British economist who died in 1823, gave the world two deep economic insights. The first, the concept of comparative advantage, became economic gospel, used ever since to justify specialization and trade. The second, the concept of Ricardian Equivalence, has become almost as universally accepted. Ricardian Equivalence asserts that only the amount of… Read more

We are thrilled to see the first estimate of the 4th quarter GDP come in way above our forecast, but we wish we had forecast the change. We do expect to see the initial estimate revised down in subsequent releases. Why did the GDP estimate come in so strong? Mostly, it was investment. Fourth quarter… Read more

Today’s data releases highlight the challenges facing those who claim we are in a recovery. The December retail sales volume, down 0.3 percent from November, was perhaps the most shocking number to the optimists out there. This was almost a full percentage point below “consensus expectations,” which were for 0.5 percent growth. So much for… Read more

This morning’s December employment situation report showed certain signs of improvement that do indicate a positive trend. However, the fourth quarter of 2009 ended down, consistent with our forecast. The November jobs number was revised to show a month-on-month gain of jobs. The December jobs number was down 0.8 percent from November and down three… Read more