Monetary Economics

Peter C. Earle

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7/5/24

June U-3 Jobless Rate Triggers Sahm Rule: Recession Ahead?

“This uptick triggers the Sahm Rule, a real-time recession indicator, suggesting that the US economy is in, or is nearing, a recession.” ~Peter C. Earle
William J. Luther

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6/28/24

Prices Decline in May, Monetary Policy Tightens

“Prices today are 8.9 percentage points higher than they would have been had the Fed hit its 2-percent inflation target since January 2020.”
Alexander W. Salter

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6/24/24

There’s No Good Reason to Raise the Inflation Target

“Why not give the central bank a wider berth, if it helps to stabilize the economy? Because it doesn’t actually help. Interest rates are a distraction.” ~Alexander W. Salter
Peter C. Earle

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6/17/24

Sense and Nonsense on Petrodollars

“Myths and hyperbole aside, the weakening US-Saudi relationship is one instance amid a growing trend of diminishing US influence in global currency markets and international finance.” ~Peter C. Earle
William J. Luther

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6/12/24

FOMC Holds Rates, Revises Forward Guidance

“Just as the FOMC was slow to adjust policy when inflation surged in late 2021, it will be slow to adjust policy as inflation returns to and falls below its target in 2024.” ~William J Luther
Alexander W. Salter

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6/12/24

Prices Stable in May: Time to Cut Rates?

“M2, the most commonly cited measure of the money supply, is up 0.53 percent from a year ago. Since real income and population are growing faster than this, current M2 growth also suggests money is tight. But this is speculative.” ~Alexander W. Salter
Nicolás Cachanosky

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6/10/24

Politicizing Monetary Policy Won’t Fix the Fed’s Failings

“Even if one thinks Trump is well-suited to make interest rate decisions (and there is little reason to think he is), it does not follow that Trump’s proposed solution would improve monetary policy.” ~Nicolás Cachanosky
Joakim Book

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6/3/24

Dollar Dominance, Dollar Dependence

“Skeptics to the global monetary hegemon have long called for its demise — on causes of design or ideology, theory or empirics. And for decades, they have been proven wrong.” ~Joakim Book
William J. Luther

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6/1/24

Inflation Continued to Decline in April

“While inflation is declining once more, members of the Federal Open Market Committee (FOMC) have suggested rates would need to remain high for longer than they had previously projected.” ~William J. Luther
Thomas Savidge

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5/30/24

Why Does the Federal Government Borrow?

“Policymakers have an incentive to finance spending with money printing and debt to hide the cost of spending from taxpayers. These costs cannot be hidden forever, though.” ~Thomas Savidge