Edward Conard

Top Ten New York Times Bestselling Author

  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “Unintended Consequences offers deep and well-argued analyses on almost every issue.” - The New York Times
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “Unintended Consequences is far smarter and more thought-provoking than most economics written for the general public” - Greg Mankiw, Harvard University, Former Chairman of the Council of Economic Advisors
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “A full-throated defense of economic dynamism.” - The Wall Street Journal
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Thursday, March 16, 2023

AI Summary. The gap between the rate at which banks lend to each other and the equivalent Treasury bill yield, known as the TED spread, widens as distrust between banks grows. There is no particular evidence that confidence between banks has broken down, and nothing remotely comparable to the global financial crisis.

John Authers Bloomberg
Date Posted:

.@johnauthers points to the relative stability of the gap between the rate of inter-bank loans and Treasury bills and argues that broad stress in the banking system is limited.

Does the spread between bank lending rates and Treasury bills signal distrust?

Core argument: The TED Spread, measuring the gap between interbank lending rates traditionally captured by Libor and equivalent Treasury bill yields, shows no particular evidence that confidence among banks has broken down.

The “TED Spread” — the gap between the rate at which banks lend to each other, traditionally captured by Libor (the London Interbank Offer Rate) and the equivalent Treasury bill yield. The higher the spread, the greater the distrust between banks. There is no particular evidence that confidence has broken down at present, and certainly nothing remotely comparable to the GFC.

Takeaways by Macro Roundup® AI

  1. The TED Spread, measuring the gap between interbank lending rates traditionally captured by Libor and equivalent Treasury bill yields, shows no particular evidence that confidence among banks has broken down.
  2. A higher TED Spread indicates greater distrust between banks, and present levels are nothing remotely comparable to those seen during the Global Financial Crisis.

AI Summary. US exports to China are 23% below where they would be had they grown at the same rate as China's imports from the world, with former major manufacturing exports such as automobiles and Boeing jets nearly absent. Record US farm sales to China reflect higher prices rather than larger shipment volumes.

Chad Brown and Yilin Wang Peterson Institute for International Economics
Date Posted:

Chinese imports from the US have fallen far short of the $200B commitments in President Trump’s “Phase One” agreement in 2020 and are now 23% below the trend prior to the 2017 start of the trade war. @ChadBown

Are US exports to China falling behind other countries' sales there?

Core argument: US exports to China in 2022 were 23 percent below the level they would have reached had they grown at the same rate as China's imports from the world each year over 2018–22.

Newly released data from 2022 show that US exports are falling farther and farther behind foreign peers also selling into the Chinese market. Once major US manufacturing exports—like automobiles and Boeing jets—have all but disappeared. Even where US exports appear to be doing alright—US farm sales to China in 2022 hit record highs—worrying signs have emerged. Much of the agricultural gains were not the result of increased shipments but simply higher prices and concerns over global food insecurity associated with the Russia-Ukraine war. A useful comparison is to examine US exports to China relative to their projected levels had they grown at the same rate as China’s imports from the world each year over 2018–22. US exports to China in 2022 are now 23 percent lower than that trend.

Takeaways by Macro Roundup® AI

  1. US exports to China in 2022 were 23 percent below the level they would have reached had they grown at the same rate as China's imports from the world each year over 2018–22.
  2. Once-major US manufacturing exports to China, including automobiles and Boeing jets, have all but disappeared, while US exports fall farther behind foreign peers selling into the Chinese market.
  3. US farm sales to China hit record highs in 2022, but much of the gain came from higher prices and concerns over global food insecurity associated with the Russia-Ukraine war rather than increased shipments.

AI Summary. Large American firms spent $2.5trn on capital expenditure and research, about 5% of GDP, roughly a fifth more in real terms than before the pandemic, but bank trackers now show near-zero US growth and a global slowdown. Analysis of about 700 big US and European firms' plans points to a 1% real-terms spending decline.

Economist Staff The Economist
Date Posted:

An @TheEconomist analysis notes slowing growth in capital investments in 2022, and forecasts that large, listed US and European firms will reduce capex by 1% in 2023.

Is corporate investment growth stalling after a post-pandemic surge?

Core argument: S&P 500 firms spent $2.5trn on capex and R&D in 2021 and 2022, equivalent to 5% of American GDP and a real-terms rise of roughly a fifth versus 2018-19.

In 2021 and 2022 firms in the S&P 500 index of large American firms spent $2.5trn, equivalent to 5% of the country’s GDP, on capex and R&D, a real-terms rise of around a fifth compared with 2018-19. An American capex “tracker” produced by Goldman Sachs, a bank, offers a picture of businesses’ outlays, as well as hinting at future intentions. It is currently registering close to zero growth, year on year. A global tracker produced by JPMorgan Chase, another bank, also points to a sharp deceleration. The Economist analysed capital-spending data from 33 OECD countries. In the fourth quarter of last year capex fell by 1% from the previous quarter. Our analysis of the plans of around 700 big, listed American and European firms suggests real-terms spending will fall by 1% in 2023.

Takeaways by Macro Roundup® AI

  1. S&P 500 firms spent $2.5trn on capex and R&D in 2021 and 2022, equivalent to 5% of American GDP and a real-terms rise of roughly a fifth versus 2018-19.
  2. Goldman Sachs's American capex tracker registers close to zero year-on-year growth, and JPMorgan Chase's global tracker also points to a sharp deceleration.
  3. The Economist's analysis of capital-spending data from 33 OECD countries found capex fell by 1% in the fourth quarter from the previous quarter, and the plans of around 700 big listed American and European firms suggest real-terms spending will fall by 1% in 2023.

AI Summary. Workers most likely to leave cities for the suburbs are high earners in technology, finance, real estate and entertainment who are key sources of income and property tax revenue, while lower-paid service, health care, hospitality and food workers are least likely to move. The 56 largest US metropolitan areas saw a cumulative decline of 900,000 in their white populations.

Thomas Edsall New York Times
Date Posted:

.@Edsall highlights the risk of downward spirals for major American cities, as higher-income workers take advantage of hybrid work schedules to move to suburbs, leaving cities with declining populations that are both lower-income and more non-white.

.@Edsall highlights the risk of downward spirals for major American cities, as higher-income workers take advantage of...

Are cities losing their highest-earning taxpayers to the suburbs?

Core argument: Brookings demographer William Frey reported that the 56 largest U.S. metropolitan areas saw a cumulative decline of 900,000 in their white populations from 2020 to 2021.

The men and women most likely to move to the suburbs are among the highest-paid key sources of income and property tax revenues: workers with six-figure salaries in technology, finance, real estate and entertainment. Those least likely to move, in turn, are paid much less, working in service industries, health care, hospitality and food sales. There is a striking interaction between the Covid-driven exodus from the cities and changing racial and ethnic urban populations. From 2020 to 2021, the nation’s 56 largest metropolitan areas saw a cumulative decline of 900,000 in their white populations William Frey, a demographer and senior fellow at the Brookings Institution reported.  The challenge facing cities is that dysfunction tends to engender dysfunction; downward spirals accelerate. Covid and remote work have transformed the face of urban America, just as the nation’s cities were becoming increasingly racially and ethnically diverse.

Takeaways by Macro Roundup® AI

  1. Brookings demographer William Frey reported that the 56 largest U.S. metropolitan areas saw a cumulative decline of 900,000 in their white populations from 2020 to 2021.
  2. Workers most likely to move to the suburbs hold six-figure salaries in technology, finance, real estate and entertainment, and rank among the highest-paid sources of city income and property tax revenues.
  3. Workers least likely to leave cities are paid much less, in service industries, health care, hospitality and food sales.

AI Summary. The share of job postings offering at least one remote day per week rose more than three-fold in the U.S. and five-fold or more in Australia, Canada, New Zealand and the U.K., exceeding 10% in all but New Zealand. These shifts vary widely across cities, industries, occupations and companies.

Stephen Hansen, Peter John Lambert, et al National Bureau of Economic Research
Date Posted:

Over 10% of job listings in the Anglosphere countries now allow for remote work for at least one day a week. @I_Am_NickBloom @StephenEKHansen @pj_lambert @raffasadun @Bledi_Taska

How much have job postings offering remote work increased?

Core argument: Job postings offering at least one remote day per week rose more than three-fold in the U.S. and five-fold or more in Australia, Canada, New Zealand and the U.K. from 2019 to 2022.

The share of postings that say new employees can work remotely one or more days per week was tiny before the pandemic: 1% or less in Australia, Canada and New Zealand as of 2019, about 3% in the U.K., and about 4% in the U.S. From 2019 to 2022, this remote-work share rose more than three-fold in the U.S and five-fold or more in the other countries. As of January 2023, the remote-work share exceeds 10% of postings in Australia, Canada, the U.K, and the U.S., and it appears to be on an upward trajectory in all five countries. These developments are highly non-uniform across and within cities, industries, occupations, and companies. Even when zooming in on employers in the same industry competing for talent in the same occupations, we find large differences in the share of job postings that explicitly offer remote work.

Takeaways by Macro Roundup® AI

  1. Job postings offering at least one remote day per week rose more than three-fold in the U.S. and five-fold or more in Australia, Canada, New Zealand and the U.K. from 2019 to 2022.
  2. Before the pandemic, postings advertising remote work stood at about 4% in the U.S., about 3% in the U.K., and 1% or less in Australia, Canada and New Zealand as of 2019.
  3. Remote-work postings exceed 10% of the total in Australia, Canada, the U.K. and the U.S. as of January 2023, with large differences across cities, industries, occupations, and even among employers in the same industry competing for the same occupations.

Friday, March 17, 2023

AI Summary. Labor-force participation for Americans ages 25 to 54 reached 83.1%, surpassing its pre-pandemic peak, something that did not occur in the prior two expansions. Participation for those ages 20 to 24 and over 55 remains well below pre-pandemic levels, with more than 400,000 Americans in their 20s missing from the labor force.

Hal Scott Wall Street Journal
Date Posted:

.@HalScott_HLS argues the Federal Reserve failed to stem the on SVB by not serving as the lender of last resort early on, using its authority under Section 10B of the Federal Reserve Act via the discount window. #Federal Reserve #SVB

.@HalScott_HLS argues the Federal Reserve failed to stem the on SVB by not serving as the lender of last resort early on,...

Has prime-age labor-force participation recovered while young adults lag behind?

Core argument: The labor-force participation rate for Americans ages 25–54 reached 83.1% in February, surpassing its pre-pandemic, pre-recession peak — something that did not occur during either of the two prior economic expansions.

In February, the labor-force participation rate for Americans ages 25 to 54 hit 83.1%, surpassing its pre-pandemic, pre-recession peak — which never happened during the past two economic expansions. The 25-to-54 age group is the core of the labor force, often referred to as “prime age.” But there are 58 million working Americans outside of it, 21 million younger and 37 million older. Teenagers are now substantially more likely to be in the labor force than before the pandemic, so they’re not the issue. But participation rates for those ages 20 to 24 and above 55 are still well short of where they were in February 2020. The decline among young adults is a different story. As the second chart above makes clear, it’s not just the 20-to-24 group that’s affected, with those in their late 20s seeing even bigger declines in participation and employment. There haven’t been big shifts in the age distribution within either group, so composition effects aren’t to blame. It’s simply more than 400,000 Americans in their 20s missing from the labor force, people who should be at the beginning of long careers, not fading into the sunset.

Takeaways by Macro Roundup® AI

  1. The labor-force participation rate for Americans ages 25–54 reached 83.1% in February, surpassing its pre-pandemic, pre-recession peak — something that did not occur during either of the two prior economic expansions.
  2. Participation rates for Americans ages 20–24 and those above 55 remain well short of their February 2020 levels, while teenagers are substantially more likely to be in the labor force than before the pandemic.
  3. More than 400,000 Americans in their 20s are missing from the labor force, with those in their late 20s showing even larger declines in participation and employment than the 20-to-24 group, and shifts in age distribution do not explain the drop.

AI Summary. US labor-force participation for ages 25 to 54 reached 83.1%, surpassing its pre-pandemic peak, while participation rates for those ages 20 to 24 and over 55 remain well below pre-pandemic levels. More than 400,000 Americans in their 20s are missing from the labor force, a decline not explained by shifts in age composition.

Justin Fox Bloomberg
Date Posted:

Labor force participation for workers aged 25-54 hit 83% in Feb, surpassing its pre-pandemic peak. However, participation for those aged 20-24 remains well below pre-pandemic levels, with 400k Americans missing from the labor force. @foxjust

Why are young adults missing from the labor force?

Core argument: U.S. labor-force participation for ages 25–54 reached 83.1% in February, surpassing its pre-pandemic, pre-recession peak, something that did not occur during either of the past two economic expansions.

In February, the labor-force participation rate for Americans ages 25 to 54 hit 83.1%, surpassing its pre-pandemic, pre-recession peak — which never happened during the past two economic expansions. The 25-to-54 age group is the core of the labor force, often referred to as “prime age.” But there are 58 million working Americans outside of it, 21 million younger and 37 million older. Teenagers are now substantially more likely to be in the labor force than before the pandemic, so they’re not the issue. But participation rates for those ages 20 to 24 and above 55 are still well short of where they were in February 2020. The decline among young adults is a different story. As the second chart above makes clear, it’s not just the 20-to-24 group that’s affected, with those in their late 20s seeing even bigger declines in participation and employment. There haven’t been big shifts in the age distribution within either group, so composition effects aren’t to blame. It’s simply more than 400,000 Americans in their 20s missing from the labor force, people who should be at the beginning of long careers, not fading into the sunset.

Takeaways by Macro Roundup® AI

  1. U.S. labor-force participation for ages 25–54 reached 83.1% in February, surpassing its pre-pandemic, pre-recession peak, something that did not occur during either of the past two economic expansions.
  2. More than 400,000 Americans in their 20s are missing from the labor force, with participation for the 20-to-24 group and those in their late 20s still well short of February 2020 levels.
  3. Teenagers are substantially more likely to be in the labor force than before the pandemic, and the absence of big shifts in age distribution within the younger and older groups rules out composition effects.

AI Summary. English-speaking countries including the UK, US, Canada, Australia, New Zealand, and Ireland have stayed at roughly 400 homes per 1,000 residents while western Europe has reached 560, and house prices have risen further and faster in most of the Anglosphere. The author attributes the divergence to a cultural aversion to urban density.

John Burn-Murdoch Financial Times
Date Posted:

Anglosphere countries have a strong preference for low density housing. This has led to much more expensive housing in Anglosphere countries and supply of 400 homes per 1k residence vs. 540 per 1k in western Europe.

Does an aversion to density explain higher English-speaking housing costs?

Core argument: Western Europe's housing stock has reached 560 homes per 1,000 residents, while the UK, US, Canada, Australia, New Zealand, and Ireland have stood still at roughly the 400 per 1,000 both groups shared 40 years ago.

Forty years ago, the UK, US, Canada, Australia, New Zealand, and Ireland had roughly 400 homes per 1,000 residents, level with developed continental European countries. Since then the two groups have diverged, the Anglosphere standing still while western Europe has pulled clear to 560 per 1,000. Unsurprisingly, the same pattern is reflected in house prices, which have risen further and faster in most anglophone countries since the global financial crisis than elsewhere. There appears to be a deep-seated aversion to urban density in anglophone culture that sets these countries apart from the rest.

Takeaways by Macro Roundup® AI

  1. Western Europe's housing stock has reached 560 homes per 1,000 residents, while the UK, US, Canada, Australia, New Zealand, and Ireland have stood still at roughly the 400 per 1,000 both groups shared 40 years ago.
  2. House prices have risen further and faster in most anglophone countries since the global financial crisis than elsewhere, mirroring the divergence in homes per 1,000 residents.
  3. An apparent deep-seated aversion to urban density in anglophone culture sets these countries apart from the rest.

AI Summary. Panamanian immigration data show 49,291 migrants crossed the Darien Gap rainforest between Colombia and Panama en route to the U.S. over a two-month span, more than a fivefold increase from 8,964 in the same period a year earlier. Chinese nationals accounted for about 2,200 of those crossings, up from 71.

Ryan Dube and Shen Lu Wall Street Journal
Date Posted:

Migrants, including a sharp increase in Chinese, are surging into Panama as they seek entry into the United States. Border Patrol agents have arrested 4,271 Chinese nationals since Oct, a 12-fold increase from the same period a year earlier. @WSJ

How sharply have U.S.-bound migrant crossings through the Darien Gap risen?

Core argument: About 2,200 Chinese migrants crossed the Darien Gap in the first two months of 2023, up from 71 recorded passing through Panama in the same period last year.

The number of migrants crossing into Panama after trudging through the treacherous Darien Gap jungle reached record levels in the first two months of the year, data from Panama showed, posing a fresh challenge to their destination country, the U.S. In January and February, 49,291 people from as near as Haiti and as far away as China have crossed the Darien, a span of rainforest separating Panama from Colombia. That is more than a fivefold increase from the 8,964 migrants in the same period last year, according to Panama’s immigration office. About 2,200 Chinese migrants were among those crossing the Darien Gap in the first two months of 2023, a sharp increase in a group that usually has made up a much smaller proportion of migrants through the area. During the same period last year, 71 Chinese migrants were recorded passing through Panama.

Takeaways by Macro Roundup® AI

  1. About 2,200 Chinese migrants crossed the Darien Gap in the first two months of 2023, up from 71 recorded passing through Panama in the same period last year.
  2. Panama's immigration office recorded 49,291 migrants crossing the Darien Gap in January and February, more than a fivefold increase from 8,964 in the same period last year.
  3. The record flow of migrants through the Darien Gap, a rainforest span separating Panama from Colombia, poses a fresh challenge to the U.S. as their destination country.

AI Summary. Texas's population grew 18% from 2010 to 2021 while its economy grew 39%, one and a half times faster than the national economy. In one 12-month span Texas added a net 471,000 residents, the most of any state, with about half arriving from elsewhere in America, a quarter from abroad, and a quarter from births exceeding deaths.

Economist Staff The Economist
Date Posted:

Texas’ population grew 18% from 2010-2021. If trends continue, it may surpass California’s population in the 2040s. With a $2tn 2022 GDP, Texas would rank as the world’s 9th largest economy if independent. @TheEconomist

Is Texas growing in population and economic output faster than the nation?

Core argument: Texas added a net 471,000 residents in the 12 months starting July 2021, the most of any state, equivalent to about 1,290 new Texans per day or roughly 9,000 per week.

The population of Texas as a whole grew by 18% from 2010 to 2021. The state’s economy grew by 39%, one and a half times faster than the national one. The first boom, in people, is remarkable by any standard. In the 12 months starting in July 2021 Texas added a net 471,000 residents, the most of any state. That is equivalent to 1,290 new Texans each day, or around 9,000 a week. Only a quarter of those came from natural increase (the difference between births and deaths). Another quarter were immigrants from abroad. But roughly half were arrivals from elsewhere in America. California still has more people than Texas, although, if current trends persist, Texas will eclipse it as the most populous state at some point in the 2040s

Takeaways by Macro Roundup® AI

  1. Texas added a net 471,000 residents in the 12 months starting July 2021, the most of any state, equivalent to about 1,290 new Texans per day or roughly 9,000 per week.
  2. Roughly half of Texas's population gain came from arrivals from elsewhere in America, with a quarter from natural increase and a quarter from immigration from abroad.
  3. Texas's population grew 18% from 2010 to 2021 while its economy grew 39%, one and a half times faster than the national economy, and if current trends persist Texas will eclipse California as the most populous state at some point in the 2040s.

AI Summary. Heavy rain and snow have begun easing California's long-term drought, which followed the state's driest three-year stretch on record. Many of California's reservoirs have refilled quickly, with a number returning to or surpassing average levels for the season.

Elena Shao, Mira Rojanasakul and Nadja Popovich New York Times
Date Posted:

Recent rain and snowfall in California have replenished reservoirs, helping the state better manage its long-term drought. @nytimes

Has a wet winter eased California's record drought?

Core argument: Torrential rain and snow across California have begun to ease the state's long-term drought, the driest three-year stretch on record.

Torrential rain and snow have again drenched California in recent weeks, amplifying an already wet winter season. The extreme precipitation has begun to ease the state’s long-term drought, the driest three-year stretch on record. The recent storms have quickly refilled many of California’s reservoirs. A number of them have returned to or even surpassed average levels for this time of year, compared with previous years where reservoir levels remained below the historical average.

Takeaways by Macro Roundup® AI

  1. Torrential rain and snow across California have begun to ease the state's long-term drought, the driest three-year stretch on record.
  2. California's reservoirs have refilled quickly during the storms, with a number returning to or surpassing average levels for this point in the year, unlike previous years when levels stayed below the historical average.
  3. California's water woes remain despite a very wet winter season.