Monday , August 21 2017
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Econbrowser – James Hamilton

Killing the Messenger (on Climate)

From WaPo today: The Trump administration has decided to disband the federal advisory panel for the National Climate Assessment, a group aimed at helping policymakers and private-sector officials incorporate the government’s climate analysis into long-term planning. The charter for the 15-person Advisory Committee for the Sustained National Climate Assessment — which includes academics as well as local officials and corporate representatives — expires Sunday. On Friday, the National Oceanic...

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Wisconsin Employment below April Levels, Minnesota Surges

State agencies have released data on July employment. Below is Wisconsin, compared to Minnesota and the Nation. Figure 1: Nonfarm payroll employment in Minnesota (blue), Wisconsin (red), and US (black), all in logs normalized to 2011M01=0. The light green shaded period pertains to data that has not yet been benchmarked using QCEW data. Source: WI DWD, MN DEED, BLS and author’s calculations. The difference in trajectories for MN and WI employment has become ever more prominent in recent...

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Not Foxconn in the Henhouse

But maybe Walker in the henhouse. From the Legislative Audit Bureau, the Memorandum of Understanding between Wisconsin and Foxconn states: …Foxconn agrees to invest $10 billion to construct, over six years, a facility in Wisconsin and create up to 13,000 jobs, with a reported average salary of $53,875 over a period of up to six years. The state’s agreement, under the MOU, among other things, is to provide up to $3 billion in an economic package which would include refundable tax credits...

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Growth Expectations Pre- and Post-Election

In response to my assertion growth expectations popped up post-election, and have subsequently receded, Reader Neil writes: Did the consensus ever price in an economic boom in the US? Growth expectations in the US for 2017 did not shift, at least according to Blue Chip – essentially flat at 2.2%. … I was intrigued by this comment, so I followed up. In particular, I focus on 2018, presumably when anticipated fiscal and/or other policies would kick in (the ten year-three month yield curve...

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Asset Prices and Economic Policy Uncertainty, Post-Election

The economy plugs along much as it did before the election, while the stock market hits new highs. What about other variables? First, the yield curve and the dollar are at levels lower than what was recorded on the eve of the election. The former suggests slower anticipated growth relative to pre-election. The lower dollar suggests less of an anticipated economic boom relative to foreign countries. Figure 1: Ten year minus three month secondary market Treasury yield, % (blue, left scale),...

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“What’s the Problem with Low Inflation?”

That’s the title of a new EconoFact article by Michael Klein. Today’s low inflation has some economists puzzled. The Federal Reserve has persistently undershot its inflation target of 2 percent since 2012, when it established this level of inflation as one of its policy goals. …Low inflation can be a signal of economic problems because it may be associated with weakness in the economy. When unemployment is high or consumer confidence low, people and businesses may be less willing to make...

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What’s the Dead Weight Loss of a Consumption Tax When Externalities Are Present?

Or, Ironman at Political Calculations mangles Econ 101. Again. Political Calculates takes on the issue of the Philadelphia soda tax issue, asking specifically “Who is really paying Philadelphia’s controversial soda tax? And how much, if at all, has it affected the economy of the City of Philadelphia?” A little online tool to calculate tax incidence and dead weight loss (DWL) is provided, motivated by the following graph: Source: Political Calculations. Now, the funny thing is that the graph...

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Guest Contribution: “Central Banks: From Triumph to Crisis and The Road Ahead”

Today we are pleased to present a guest contribution written by Pierre Siklos, Professor of Economics at Wilfrid Laurier University. The Great Recession of 2008-9 was preceded by the Great Moderation, a period thought to have lasted around 20 years. Nevertheless, as we approach a decade since the Global or Great Financial Crisis (GFC) erupted, there is impatience with the state of the global economy even if recent data suggest more optimism than even a year ago. Unsurprisingly, the last...

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