Global Economy

Chair Warsh’s focus on the Fed’s balance sheet and inflation can be interpreted in many ways. One way is a money base version of the Quantity Theory. Take the Quantity Theory as an identity: MV = PQ P = MV/Q Let M = MB × mult, where M is a broad measure of money, MB  is the money base, roughly the liabilities side of the Fed’s balance sheet. Take logs, where lower case letters denote logs of upper case letters. p = mb + log(mult) + v – q One can think of q as a determina

In Chairman Warsh’s acceptance speech yesterday, he stated: I will lead a reform-oriented Federal Reserve, learning from past successes and mistakes both, escaping static frameworks and models, and upholding clear standards of integrity and performance. When I was watching the proceedings on TV, I wondered (yet again) what he could possibly have meant by “static frameworks and models”. There are models that are “dynamic” in the (Cowles Foundation) econometric sense

For EPU through yesterday, news sentiment through 5/18. Figure 1: Shapiro-Sudhof-Wilson News Sentiment (blue, left scale), Economic Policy Uncertainty (light red, right scale), 7-day centered moving average (bold red, right scale). Source: SF Fed, policyuncertainty.com. The News Sentiment Index has arguably been lower after 1/20/2025 than before, while EPU has been higher (simple OLS each index on Trump dummy).  

1. Fortune covers my AI talk for Sana in NYC.  Plus my NBA predictions, made Thursday a.m. 2. SGA does seem to flop more. 3. Marc Andreessen on AI. 4. Thomas Sargent lectures on YouTube. 5. Why Japanese companies do so many different things. 6. Fresh Knausgård. 7. ““The Boys of Dungeon Lane” is absolutely the best album ever recorded and released by a rock star in his 80s.“ The post Saturday assorted links appeared first on Marginal REVOLUTION.

This was a great failure of the most recent philanthropic era. At its best, the infrastructure established by figures like Gates delivered effective efforts to reduce poverty and fight disease; at its worst, it threw money after fashionable political causes and education fads. But there was no real legacy when it came to physical infrastructure — no great beautification campaigns, no beloved architectural landmarks, no equivalent of the Gilded Age’s expansions of museums and libraries and concer

That’s an assertion by EJ Antoni. Well, in Director Judy Hsu’s May report, she tackles this issue directly. The April 2025 report, “Partisan Perceptions and Sentiment Measurement,” discusses how partisan differences do not distort the national survey estimates of changes over time. A year later, amid historically rapid changes in the public policy landscape, partisan gaps in sentiment are now even larger while national sentiment has trended down in recent months. Are the relatively

Yes I will be doing a Conversation with him.  Chase and Charles Koch have a new book out, namely Becoming a Principle-Driven Leader: 41 Principles to Build an Enduring Business.  And for background here is Wikipedia on Chase Koch.  So what should I ask him? The post What should I ask Chase Koch? appeared first on Marginal REVOLUTION.

Ten notable facts from India’s new SRS Statistical Report 2024 published two days ago: 1) India’s total fertility rate (TFR) has dropped to 1.88 (rounded up to 1.9 in the figures) in 2024 from 1.92 in 2023. 2) This drop is roughly the historical speed of the last few decades. India’s TFR was 4.3 in 1985 and it has been falling around 0.06 per year since then. 3) For those who think “smartphones are the reason for the fall of TFR,” there is not much change in India’s TFR after their introduction.

Using the HP filter applied to U.Michigan Sentiment, consumers don’t seem too gloomy relative to “average”. But they do seem gloomy relative to observed unemployment and inflation rates. Figure 1: University of Michigan Sentiment demeaned (bold black), HP detrended (blue), Misery Index regression residual (red), Misery Index 2010-26 residual (teal). NBER defined peak-to-trough recession dates shaded gray. May observations for unemployment at April level, for inflation using C

As Mark Lilla, a recovering Straussian, once remarked, they [the Straussians] were like craftsmen building a house brick by brick on a foundation that Leo Strauss had laid.  But they would never become architects of that house, or decide that the house was too small for them to comfortably live in.  Moreoever, Strauss disparaged social science and what he considered naive forms of positivism prevalent in American universities.  This led some of his followers to disdain merely empirical accounts

From today’s U.Mich release, final 1 yr revised up from 4.5% to 4.8%, and 5 yr revised up from 3.4% to 3.9% (!). Figure 1: Year-on-Year CPI inflation (bold black), forecasted U.Mich mean inflation (red), NY Fed median (brown), SoFIE (sky blue +), all in %. NBER defined peak-to-trough recession dates shaded gray. Source: BLS, U.Mich., NY Fed, Cleveland Fed, and NBER.   Figure 2: U.Mich five year ahead expected inflation (red), NY Fed 3 year ahead expected inflation (brown), %. Obser

May Michigan Sentiment downwardly revised from preliminary, to a record low. Figure 1: U.Michigan Economic Sentiment (blue), Conference Board Confidence Index (brown), Gallup Confidence (green), all demeaned and divided by standard deviation 2021M01-2025m02. Red dashed line at “Liberation Day” Source: UMichigan, Gallup, Conference Board, and author’s calculations. The final Sentiment reading was revised down to 44.8 from preliminary 48.2. Expectations were revised down even more — from 48

1. One reason why child care is so expensive in the U.S. 2. “For the first time in decades, new and recent graduates with at least a bachelor’s degree have consistently higher unemployment rates than the overall American workforce, according to data on 22-to-27-year-olds compiled by the Federal Reserve Bank of New York.” Link here. 3. Redux of my 2021 Bloomberg column on the ideal university. 4. 15-minute weird Brazilian album. 5. History of social science funding at the NSF. 6. Furm

You can find them here: https://x.com/theblackvault/status/2057800997012197428?s=61 The post The new tranche of UAP videos appeared first on Marginal REVOLUTION.

Love will tear us a chart

A VATcident waiting to happen

Benjamin Arbuckle is combining archaeology and ancient DNA analysis to reconstruct entire ecosystems of ancient cities, aiming to show how human societies can thrive in balance with their environments. Jesse Casana, an archaeology professor at Dartmouth, is developing drone-based radar imaging methods to detect and map buried archaeological sites beneath desert sands, combining advanced remote sensing technologies to preserve endangered cultural landscapes and transform archaeological discovery

Jobs; megatrends; data; hating; Kean; lawsuits; Makerfield; hotels; Norway

The third type of weapons are invasion ships – this is the classic science fiction trope, however actual invasion ships have one fundamental weakness – they need to slow down at the destination galaxy. This has two effects. Firstly, energetically getting invasion ships to the opponents galaxy is substantially less efficient than sending RKVs there. This is because of the tyranny of the rocket equation. While the invasion ships can be accelerated to relativistic velocities at origin galaxy, to sl

The best defence may in fact be defence