Edward Conard

Top Ten New York Times Bestselling Author

  • “A full-throated defense of economic dynamism.” - The Wall Street Journal
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “Unintended Consequences should be read by anyone who takes for granted the superiority of progressive taxation and has not thought carefully about the trade-offs involved.” - The New Republic
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “Unintended Consequences provides a provocative interpretation of the causes of the global financial crisis and the policies needed to return to rapid growth. Whether you agree or not, this analysis is well worth reading.” - Nouriel Roubini, New York University; Chairman, Roubini Global Economics
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “There are an amazing number of good ideas and interesting points made in Unintended Consequences. The thinking underlying it, and the obvious depth of understanding of the author, are very impressive.” - Steven Levitt, coauthor of Freakonomics; 2004 John Bates Clark Medal
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Tuesday, May 23, 2023

AI Summary. The authors estimate that food and especially energy price shocks, along with increased demand for durable goods combined with supply-chain shortages, accounted for much of U.S. pandemic-era inflation, while the contribution of tight labor markets was small or negative early on. They estimate that tight labor-market conditions became an increasingly important, though not dominant, source of inflation over time.

Ben Bernanke and Olivier Blanchard Brookings Institution
Date Posted:
Is Database:
Database
Is Important:
Important

.@benbernanke and @ojblanchard1 argue that bringing the current inflationary episode to target implies an unemployment rate of 4.3%, up from 3.4% last month.

What drove pandemic-era inflation, supply shocks or tight labor markets?

Core argument: The authors' decomposition of U.S. inflation from 2020Q1 to 2023Q1 attributes much of the rise in overall inflation in late 2021 and the first half of 2022, and its decline in the second half of 2022, to energy price shocks, with food price shocks also contributing substantially.

Figure 12 shows the estimated sources of inflation from 2020Q1 to 2023Q1. For comparison, the continuous line shows actual inflation. (The inflation data are quarterly, at annualized rates, and thus more jagged than the annualized series we often see.)  Figure 12 yields several conclusions. First, the contributions of food [light blue] and (especially) energy [dark blue] price shocks to the pandemic-era inflation were large. Energy price shocks in particular account for much of the rise of overall inflation in late 2021 and the first half of 2022, and the for the decline in inflation in the second half of 2022. The large and extended contributions of commodity price shocks to inflation shown in Figure 12 are not inconsistent with our earlier finding that price shocks tend to have transitory effects on inflation, as both energy and food prices rose continuously over much of the period (see Figures 4 and 5), which our procedure interprets as a series of positive shocks. Second, the combination of increased demand for durables and shortages [yellow] associated with disrupted supply chains was the dominant source of inflation in 2021Q2, and the effects of supply chain problems, both direct and indirect, remained significant through the end of our sample period. Third, and importantly, the contribution to inflation of tight labor-market conditions [red] —the leading concern of many early critics of U.S. monetary and fiscal policies—was quite small early on, and indeed was negative in 2020 and early 2021 as labor markets suffered from the effects of the pandemic recession. However, over time, as the labor market has remained tight, the traditional Phillips curve effect has begun to assert itself, with the high vacancy-to-unemployment ratio becoming increasingly important, though by no means dominant, source of inflation.

Takeaways by Macro Roundup® AI

  1. The authors' decomposition of U.S. inflation from 2020Q1 to 2023Q1 attributes much of the rise in overall inflation in late 2021 and the first half of 2022, and its decline in the second half of 2022, to energy price shocks, with food price shocks also contributing substantially.
  2. Increased demand for durables combined with shortages from disrupted supply chains was estimated as the dominant source of inflation in 2021Q2, and supply chain effects, both direct and indirect, remained significant through 2023Q1.
  3. Tight labor-market conditions contributed little to inflation early on and negatively in 2020 and early 2021, with the high vacancy-to-unemployment ratio becoming an increasingly important, though not dominant, source over time.

AI Summary. European stocks traded at a price-to-earnings multiple far below US stocks, a roughly 35% discount that remains large by historical standards. The author argues European outperformance has a ceiling because US companies generate higher returns on equity and on assets.

Michael Cembalest J.P. Morgan
Date Posted:
Is Database:
Database

Michael Cembalest @jpmorgan argues investors no longer need to overweight the US and emerging markets relative to Europe and Japan.

Does Europe's valuation discount justify buying European stocks over US stocks?

Core argument: Europe's price-to-earnings multiple relative to the US fell to a post-2006 low by September 2022, a roughly 35% discount that the author argues compensated investors for taking European equity exposure.

By September 2022, Europe’s P/E multiple hit a post-2006 low relative to the US. While there were valid concerns at the time about Europe’s energy situation, rising inflation and exposure to a shuttered China, investors were receiving an enormous discount for taking European equity exposure, and I should have paid more attention to that. Europe’s outperformance is likely to have a ceiling since US companies generate higher returns on equity and higher returns on assets, as shown in the table. But everything has a price, and a 35% P/E discount was apparently it. As things stand now, the discount is still large from an historical perspective.

Takeaways by Macro Roundup® AI

  1. Europe's price-to-earnings multiple relative to the US fell to a post-2006 low by September 2022, a roughly 35% discount that the author argues compensated investors for taking European equity exposure.
  2. Concerns about Europe's energy situation, rising inflation, and exposure to a shuttered China were valid, yet coincided with a large valuation discount on European equities.
  3. The author argues Europe's outperformance is likely to have a ceiling because US companies generate higher returns on equity and assets, while Europe's P/E discount remains large by historical standards.

AI Summary. A widely forecast recession has not arrived because households are still drawing down excess savings built up from roughly $5tn of fiscal and $5tn of monetary expansion during Covid. The author argues that with inflation at 5%, the Federal Reserve will keep capital costs high, pressuring earnings and employment growth.

Torsten Sløk Apollo
Date Posted:

Torsten Sløk @apolloglobal argues that “it is taking longer to remove from the economy the $5T fiscal and $5T monetary expansion done during covid,” and expects a recession as households eventually run out of excess savings.

Why has the forecast recession not arrived yet?

Core argument: The $5trn fiscal and $5trn monetary expansion done during covid is taking longer to remove from the economy, which is why the recession forecast by consensus since October 2022 has not arrived.

The consensus has been forecasting negative growth since October 2022, and the recession has yet to arrive because it has taken longer to run down excess savings in the household sector, see chart below. Put differently, it is taking longer to remove from the economy the $5trn fiscal and $5trn monetary expansion done during covid. On the back of stronger-than-expected growth, the correction in stock markets and credit spreads has been relatively limited despite the rapid increase in short rates. With inflation still at 5%, far above the Fed’s 2% inflation target, the Fed will keep the costs of capital high, and the recession will come as households eventually run out of excess savings. The implication for markets is that the Fed will continue to put downward pressure on earnings growth and employment growth until they get what they want, namely lower inflation.

Takeaways by Macro Roundup® AI

  1. The $5trn fiscal and $5trn monetary expansion done during covid is taking longer to remove from the economy, which is why the recession forecast by consensus since October 2022 has not arrived.
  2. With inflation still at 5%, far above the Fed's 2% target, the Fed will keep the cost of capital high, and recession will come once households run out of excess savings.
  3. Stronger-than-expected growth has kept the correction in stock markets and credit spreads relatively limited despite the rapid increase in short rates, and the Fed will continue to pressure earnings and employment growth until inflation falls.

AI Summary. A Senate proposal would have the federal government borrow about $1.5tn over five years—at a federal borrowing rate of roughly 3.9%—and invest it in stocks, private equity, and other assets riskier than Treasury bonds for 75 years, borrowing meanwhile to cover Social Security shortfalls. A Wharton economist argues this is not meaningfully different from raising the capital gains tax.

Andrew Biggs National Review
Date Posted:

.@biggsag of @AEIecon argues that funding Social Security by borrowing $1.5T and investing in American equity markets is a well-motivated but bad idea that would be “not meaningfully different from simply increasing the capital gains tax.”

Is borrowing to invest in stocks different from raising capital gains taxes?

Core argument: Senator Bill Cassidy proposes the federal government borrow roughly $1.5 trillion over five years, at a current federal borrowing rate of about 3.9%, and reinvest it in stocks, private equity, hedge funds, or other instruments riskier than Treasuries but with higher expected returns.

Senator Bill Cassidy proposes that, over a five-year period, the federal government should borrow approximately $1.5 trillion. The current federal borrowing rate is roughly 3.9%. The federal government would reinvest those funds in stocks, private equity, hedge funds, or other instruments that are riskier than U.S. Treasury bonds but offer higher expected returns. The fund would hold its investments for 75 years, presumably building interest along the way. Until then, the federal government would borrow to cover Social Security’s funding shortfalls. After 75 years, the investment fund could, in theory at least, repay that borrowing. As Wharton School economist Kent Smetters has shown, Cassidy’s approach is not meaningfully different from simply increasing the capital gains tax: When the stock market goes up, the federal government takes a slice of the gains. Everything else is simply window dressing.

Takeaways by Macro Roundup® AI

  1. Senator Bill Cassidy proposes the federal government borrow roughly $1.5 trillion over five years, at a current federal borrowing rate of about 3.9%, and reinvest it in stocks, private equity, hedge funds, or other instruments riskier than Treasuries but with higher expected returns.
  2. Under Cassidy's plan, the fund would hold its investments for 75 years while the federal government borrows to cover Social Security's funding shortfalls, with the fund in theory repaying that borrowing afterward.
  3. Wharton School economist Kent Smetters argues that Cassidy's approach is not meaningfully different from raising the capital gains tax, since the federal government takes a slice of gains when the stock market rises.

AI Summary. Pew Research Center analysis of Census Bureau data finds 21-year-olds in the US are less likely than their counterparts four decades earlier to have a full-time job, be financially independent, live on their own, be married, or have a child. Among 21-year-olds, 39% worked full time versus 64% four decades earlier, and a quarter were financially independent versus 42%.

Richard Fry Pew Research Center
Date Posted:
Is Database:
Database

Pew reports that 25-year-old Americans are lagging previous generations in terms of full-time work, financial independence, and marriage. @r_fry1

Are young adults reaching adulthood milestones later than four decades ago?

Core argument: 39% of U.S. 21-year-olds were working full time in 2021, down from 64% in 1980, according to a Pew Research Center analysis of Census Bureau data.

Young adults in the United States are reaching key life milestones later than they did 40 years ago, according to a new Pew Research Center analysis of Census Bureau data. Adults who are 21 are less likely than their predecessors four decades ago to have reached five frequently cited milestones of adulthood: having a full-time job, being financially independent, living on their own, getting married and having a child. By the time they are 25, however, today’s young adults are somewhat closer to their predecessors in 1980 on two of these milestones: having a full-time job and financial independence. In 2021, the most recent year with available data, 39% of 21-year-olds were working full time, compared with 64% in 1980. And only a quarter of people this age in 2021 were financially independent of their parents – meaning that their income was at least 150% of the poverty line – compared with 42% in 1980.

Takeaways by Macro Roundup® AI

  1. 39% of U.S. 21-year-olds were working full time in 2021, down from 64% in 1980, according to a Pew Research Center analysis of Census Bureau data.
  2. A quarter of 21-year-olds in 2021 were financially independent of their parents — defined as income of at least 150% of the poverty line — compared with 42% in 1980.
  3. Pew Research Center finds that 21-year-olds are less likely than their 1980 counterparts to have a full-time job, be financially independent, live on their own, be married or have a child, though by age 25 they are somewhat closer on employment and financial independence.

AI Summary. Japan has said it intends to restrict exports of 23 types of chipmaking equipment, aligning with US and Dutch export controls that could limit China's access to cutting-edge chips. Chinese industry executives who reviewed the draft rules say they could restrict China's semiconductor manufacturing more than US measures do.

Qianer Liu, Kana Inagaki and Anna Gross Financial Times
Date Posted:

Tokyo will impose export restrictions on 23 chipmaking equipment types in July, aligning with US and the Netherland but potentially going further than US sanctions, posing a greater challenge for China’s semiconductor production. @FT

Tokyo will impose export restrictions on 23 chipmaking equipment types in July, aligning with US and the Netherland but...

Do Japan's chipmaking export curbs restrict China more than US rules?

Core argument: Japan intends to restrict exports of 23 types of chipmaking equipment from July, aligning with the US and the Netherlands in export controls that could limit China's access to cutting-edge chips.

Tokyo has said it intends to put restrictions on exports of 23 types of crucial chipmaking equipment from July, as it aligns itself with the US and the Netherlands in implementing sweeping export controls that could limit China’s access to cutting-edge chips. However, Chinese industry executives who have examined the fine print of the intended rules say they could potentially go further than the US in restricting China’s ability to make semiconductors. “Japan’s export controls will be more disturbing to China than Washington’s sanctions last year,” said a Chinese chip factory executive, who did not wish to be named.

Takeaways by Macro Roundup® AI

  1. Japan intends to restrict exports of 23 types of chipmaking equipment from July, aligning with the US and the Netherlands in export controls that could limit China's access to cutting-edge chips.
  2. Chinese industry executives who have examined the fine print of the intended Japanese rules say the measures could go further than US controls in restricting China's ability to make semiconductors.
  3. An unnamed Chinese chip factory executive said Japan's export controls will be more disturbing to China than Washington's sanctions imposed last year.

AI Summary. China is not creating enough high-wage, high-skill jobs for its expanding pool of educated young people, many of whom hold higher job expectations than earlier generations. More than 28m college graduates entered the labor market over three years, about two-thirds of the new urban labor supply, and economists describe the resulting youth unemployment as structural rather than temporary.

Stella Yifan Xie Wall Street Journal
Date Posted:

Chinese youth unemployment (16-24) is running at 20.4% well above its pre-pandemic level of 13% as a record 11.6mm college students are poised to graduate this summer.

Is China's youth unemployment a structural mismatch rather than a temporary one?

Core argument: More than 28 million Chinese college graduates entered the labor market over the past three years, accounting for about two-thirds of the new urban labor supply, following a decade of significant expansion in higher education enrollment.

China isn’t creating enough of the high-wage, high-skill jobs that are sought after by its expanding base of educated young people, many of whom have loftier expectations than previous generations. China has significantly expanded high education enrollment during the past decade. In the past three years, more than 28 million college graduates entered the labor market, accounting for about two-thirds of the new urban labor supply. “China’s high youth unemployment rate is not transitory but structural,” said David Wang, chief China economist at Credit Suisse. “There is a mismatch in the skills the youth are trained to provide and the skills that existing jobs require.”

Takeaways by Macro Roundup® AI

  1. More than 28 million Chinese college graduates entered the labor market over the past three years, accounting for about two-thirds of the new urban labor supply, following a decade of significant expansion in higher education enrollment.
  2. David Wang, chief China economist at Credit Suisse, says China's high youth unemployment rate is structural rather than transitory, citing a mismatch between the skills young people are trained to provide and those existing jobs require.
  3. China is not creating enough high-wage, high-skill jobs for its expanding base of educated young people, many of whom hold loftier expectations than previous generations.

Wednesday, May 24, 2023

AI Summary. Black employment has improved, and racial gaps in employment are considerably smaller than around 2000, which the author attributes to a gradual decline in racism and racial discrimination as reflected in employment numbers. The author argues sociological work tying lost economic opportunity to social dysfunction is supported by similar dysfunction in white small towns and rural areas left behind economically.

Paul Krugman Krugman Wonks Out
Date Posted:
Is Database:
Database

.@PaulKrugman argues the decline in black unemployment might have powerful spillover effects in terms of combating the social dysfunction that has plagued black America.

Have racial employment gaps narrowed as discrimination declined?

Core argument: Racial gaps in employment are considerably smaller than around 2000, which the author calls arguably the last period of truly full employment.

The improvement in Black employment matters a lot, and not just because of the income generated. As the sociologist William Julius Wilson argued, the loss of economic opportunities as jobs moved out of urban areas was a major driving force behind social dysfunction in Black communities. I’ve long seen the recent emergence of social dysfunction in largely white small towns and rural areas left behind by a changing economy as a vindication of Wilson’s thesis (and a repudiation of “cultural” explanations). So the fact that Black America is working again is really good news on multiple fronts. But while full employment helps, racial gaps are considerably smaller now than they were circa 2000 — arguably the last time we had truly full employment. Why? I’d argue — this will probably get me in trouble on both the right and the left — that racism and racial discrimination, while both still very real, have gradually declined over time, at least in a way that’s reflected in employment numbers.

Takeaways by Macro Roundup® AI

  1. Racial gaps in employment are considerably smaller than around 2000, which the author calls arguably the last period of truly full employment.
  2. The author attributes the narrowing of employment-based racial gaps to a gradual decline in racism and racial discrimination, while maintaining that both remain real.
  3. Citing sociologist William Julius Wilson's argument that jobs moving out of urban areas drove social dysfunction in Black communities, the author sees similar dysfunction in largely white small towns and rural areas as vindicating that thesis over "cultural" explanations.

AI Summary. Young workers aged 15-24 are particularly vulnerable when economic growth slows, and China's youth unemployment rate does not appear to be an outlier relative to its income level among global peers. Mismatches between the skills graduates acquire in higher education and those employers demand may add to labor market frictions.

Maggie Wei Goldman Sachs
Date Posted:

A @GoldmanSachs analysis notes that China’s youth unemployment is not an outlier globally but that misalignment between college discipline and business requirements remains a persistent challenge.

Why has youth unemployment risen so sharply in China?

Core argument: ILO data showed youth unemployment in 2021 exceeded 20% in a few European countries such as Spain and Italy and was close to 10% in the US, with workers aged 15–24 appearing particularly vulnerable when growth slows.

Young people aged 15-24 years old appear particularly vulnerable when economic growth slows and labor market faces stresses. For example, International Labor Organization (ILO) data showed youth unemployment rate in 2021 was more than 20% in a few European countries such as Spain, Italy, and close to 10% in the US in 2021. Note ILO’s definition is slightly different from NBS’s. ILO uses the 15-24 age group while China’s National Bureau of Statistics (NBS) survey looks at the 16-24 age group. China does not seem to be an outlier when comparing its youth unemployment rate relative to income level among global peers. Although our analysis above suggests youth unemployment rate is quite cyclical and is set to decline as service activity growth improves, there may be other structural headwinds contributing to the high youth unemployment rate. In particular, mismatches between skillset graduates acquired from their higher education and skillset required by employers in industry with booming labor demand might have caused frictions in the labor market and therefore contributed to high youth unemployment rate.

Takeaways by Macro Roundup® AI

  1. ILO data showed youth unemployment in 2021 exceeded 20% in a few European countries such as Spain and Italy and was close to 10% in the US, with workers aged 15–24 appearing particularly vulnerable when growth slows.
  2. China does not appear to be an outlier on youth unemployment relative to its income level compared with global peers, though ILO's 15–24 age definition differs from the 16–24 group used in China's National Bureau of Statistics survey.
  3. China's youth unemployment rate appears largely cyclical and is expected to decline as service activity growth improves, though mismatches between graduates' skills and those employers in industries with booming labor demand require may be a structural contributor.

AI Summary. Natural-gas prices have fallen sharply worldwide after a severe global energy shock, providing a windfall for the global economy as it contends with high inflation. Energy-intensive businesses are restarting operations, consumers face lower bills, and fears of a winter shortage have eased.

Joe Wallace and Kim Mackrael Wall Street Journal
Date Posted:

Natural gas prices are in retreat globally in what should be a positive energy shock to Europe and emerging markets.

Are falling natural-gas prices giving the global economy a boost?

Core argument: Natural-gas prices are in full retreat around the world, reversing the energy shock triggered by Russia's invasion of Ukraine that had produced the worst energy crisis since the 1970s.

This time last year, natural-gas prices were skyrocketing after Russia’s invasion of Ukraine kicked off the worst energy crisis since the 1970s. To the surprise of many prognosticators, that energy shock has now subsided, with gas prices in full retreat around the world. The result is a windfall for the global economy, especially as it contends with stubbornly high inflation. Energy-intensive businesses are restarting operations, consumers are about to enjoy lower bills and fears of a winter shortage have eased.

Takeaways by Macro Roundup® AI

  1. Natural-gas prices are in full retreat around the world, reversing the energy shock triggered by Russia's invasion of Ukraine that had produced the worst energy crisis since the 1970s.
  2. The collapse in gas prices delivers a windfall to the global economy as it contends with stubbornly high inflation, with energy-intensive businesses restarting operations and consumers set to see lower bills.
  3. Fears of a winter gas shortage have eased, an easing of the energy shock that surprised many prognosticators.

AI Summary. A model estimates global deaths remain about 5% above pre-Covid forecasts, though its confidence interval for the current excess-death rate stretches from near zero to mid-2020 levels. Relative to people aged 65 and over, excess-death rates in rich countries are three times lower than elsewhere, but older populations leave overall mortality rates similar.

Economist Staff The Economist
Date Posted:

Globally the mortality rate in the aftermath of the pandemic is running 5% above the 2019 baseline, or 3M excess deaths a year. @TheEconomist

Are global deaths still running above pre-pandemic forecasts?

Core argument: The Economist's model estimates global deaths remain about 5% above pre-Covid forecasts, though its confidence interval for the world's excess-death rate stretches from near zero up to the estimated levels of mid-2020.

Because data on total mortality is scant outside the rich world, our model’s estimates have become less precise over time. Its confidence interval for the world’s current excess-death rate stretches from near zero all the way up to the estimated levels of mid-2020. However, excluding the recent surge in China, its best guess for the past year is around one of every 1M people per day. As a share of people aged at least 65, excess-death rates in rich countries are three times lower than elsewhere. But because such places have older populations, their overall mortality rate is similar. Covid may not be the sole cause of this change. Some countries’ health-care systems remain strained, and cases of other diseases that went untreated in 2020-21 could be raising death rates today. But if covid were indeed responsible for the full increase, it would be tied for the world’s fourth-leading cause of death. At current rates, it would kill more people in the next eight years than in the past three.

Takeaways by Macro Roundup® AI

  1. The Economist's model estimates global deaths remain about 5% above pre-Covid forecasts, though its confidence interval for the world's excess-death rate stretches from near zero up to the estimated levels of mid-2020.
  2. Excluding China's recent surge, the model's best guess for excess deaths over the past year is about one per 1m people per day, with rich countries' rates three times lower than elsewhere as a share of those aged 65 and over, but similar overall given their older populations.
  3. If Covid accounted for the full increase in deaths, it would be tied for the world's fourth-leading cause of death and would kill more people over the next eight years than in the past three, though strained health-care systems and diseases untreated in 2020-21 may also be raising death rates.

AI Summary. Central banks bought 1,079 tonnes of gold bullion in a year, the most since records began in 1950, with prices hovering near the nominal all-time high of $2,072 per troy ounce. Developing countries wary of the US dollar have been diversifying reserves after the West froze $300bn of Russian foreign exchange holdings.

Harry Dempsey and Leslie Hook Financial Times
Date Posted:

Central Banks love gold. Nominal gold prices are close to reaching a nominal high as in 2022 central banks bought 1,079 tonnes of bullion, the most since records began in 1950.

Are central banks buying record gold to diversify away from the dollar?

Core argument: Central banks bought 1,079 tonnes of gold bullion last year, the most since records began in 1950.

Last year central banks bought 1,079 tonnes of bullion—the most since records began in 1950.  As a result, gold has been hovering close to its nominal all-time high of $2,072 per troy ounce—the traditional unit for precious metals—since late March.  There is a geopolitical factor, as developing countries grow wary of the strength of the US dollar. As the west imposed sanctions on Russia following the invasion of Ukraine, the US and its allies froze $300bn of foreign exchange holdings denominated in dollars, euros and sterling. That alarmed many countries with US dollar holdings, whose central banks have been racing to diversify their holdings and buy more gold.

Takeaways by Macro Roundup® AI

  1. Central banks bought 1,079 tonnes of gold bullion last year, the most since records began in 1950.
  2. Gold has hovered close to its nominal all-time high of $2,072 per troy ounce since late March.
  3. After the US and its allies froze $300bn of Russian foreign exchange holdings denominated in dollars, euros and sterling following the invasion of Ukraine, central banks holding dollars have raced to diversify into gold.

AI Summary. The Group of Seven advanced economies' share of global output at purchasing power parity fell from 44% to 30% between 2000 and 2023, while China's rose from 7% to 19%. For some emerging and developing countries, including Brazil, China is a more important economic partner than the Group of Seven.

Martin Wolf Financial Times
Date Posted:
Is Database:
Database

.@martinwolf_ suggests that the G7 is losing relevance as its share of global GDP declines. He notes that China is a larger trade partner than the G7 for many emerging markets.

Have advanced economies lost their dominant share of global output?

Core argument: The G7's share of global output at purchasing power parity falls from 44% in 2000 to 30% in 2023, while the share of all high-income countries falls from 57% to 41%.

Moreover, both the “unipolar” moment of the US and the economic dominance of the G7 are history. True, the latter is still the most powerful and cohesive economic bloc in the world. It continues, for example, to produce all the world’s leading reserve currencies. Yet, between 2000 and 2023, its share in global output (at purchasing power) will have fallen from 44 to 30 percent, while that of all high-income countries will have fallen from 57 to 41 percent. Meanwhile, China’s share will have risen from 7 to 19 percent. For some emerging and developing countries, China is a more important economic partner than the G7: Brazil is one example. President Luiz Inácio Lula da Silva may have attended the G7, but he cannot sensibly ignore China’s heft.

Takeaways by Macro Roundup® AI

  1. The G7's share of global output at purchasing power parity falls from 44% in 2000 to 30% in 2023, while the share of all high-income countries falls from 57% to 41%.
  2. China's share of global output at purchasing power parity rises from 7% in 2000 to 19% in 2023, and for some emerging and developing countries, including Brazil, China is a more important economic partner than the G7.
  3. The G7 remains the most powerful and cohesive economic bloc in the world and continues to produce all the world's leading reserve currencies, even as the US "unipolar" moment and G7 economic dominance are history.

AI Summary. China has overtaken Japan as the world's largest auto exporter, shipping 1.07m vehicles in a quarter, a 58% year-over-year increase, versus Japan's 950,000. China is also the largest exporter of electric vehicles, accounting for about 35% of global electric vehicle exports, up from 25% two years earlier.

Jacky Wong Wall Street Journal
Date Posted:

.@WSJ reports that in Q1 2023 China overtook Japan as world’s largest auto exporter.

Has China become the world's largest auto and electric vehicle exporter?

Core argument: China exported 1.07 million vehicles in the first quarter, a 58% increase from a year earlier according to official figures, overtaking Japan's 950,000 shipments reported by the Japan Automobile Manufacturers Association to become the world's largest auto exporter.

China overtook Japan as the largest auto exporter in the world last quarter. Surging exports to Russia gave the country’s car exports a big bump. But the strength of China’s electric vehicle ecosystem is also an important factor driving the trend. China exported 1.07 million vehicles in the first quarter of this year, a 58% increase from a year earlier, according to official figures. In comparison, Japan shipped 950,000 vehicles abroad during the quarter, according to the Japan Automobile Manufacturers Association. China is the largest exporter of EVs, and its lead appears to be growing: Around 35% of EVs exported globally came from China last year, compared with 25% in 2021, according to the International Energy Agency.

Takeaways by Macro Roundup® AI

  1. China exported 1.07 million vehicles in the first quarter, a 58% increase from a year earlier according to official figures, overtaking Japan's 950,000 shipments reported by the Japan Automobile Manufacturers Association to become the world's largest auto exporter.
  2. Around 35% of electric vehicles exported globally came from China last year, up from 25% in 2021, according to the International Energy Agency.
  3. Surging exports to Russia boosted China's car exports, and the strength of China's electric vehicle ecosystem is another factor driving the trend.

AI Summary. More than a dozen performances across China, including stand-up comedy, jazz and a touring Japanese choral group, were abruptly cancelled with virtually no explanation, after authorities fined a Chinese comedy studio around $2m over a joke deemed insulting to the military. Performers must submit scripts or set lists for vetting.

Vivian Wang New York Times
Date Posted:

Cultural events across China ranging from musical performances to comedy shows have been cancelled after a stand-up comic was fined $2M for making a joke which authorities in Beijing felt was at the expense of the Chinese military.

Cultural events across China ranging from musical performances to comedy shows have been cancelled after a stand-up comic...

Is China tightening control over live performances and cultural expression?

Core argument: Beijing authorities fined a Chinese comedy studio around $2 million after one of its stand-up performers was accused of insulting the Chinese military in a joke, and police in northern China detained a woman who had defended the comedian online.

The cancellations rippled across the country: A Japanese choral band touring China, stand-up comedy shows in several cities, jazz shows in Beijing. In the span of a few days, the performances were among more than a dozen that were abruptly called off — some just minutes before they were supposed to begin — with virtually no explanation. Just before the performances were scrapped, the authorities in Beijing had fined a Chinese comedy studio around $2 million, after one of its stand-up performers was accused of insulting the Chinese military in a joke; the police in northern China also detained a woman who had defended the comedian online. Those penalties, and the sudden spate of cancellations that followed, point to the growing scrutiny of China’s already heavily censored creative landscape. China’s top leader, Xi Jinping, has made arts and culture a central arena for ideological crackdowns, demanding that artists align their creative ambitions with Chinese Communist Party goals and promote a nationalist vision of Chinese identity. Performers must submit scripts or set lists for vetting, and publications are closely monitored.

Takeaways by Macro Roundup® AI

  1. Beijing authorities fined a Chinese comedy studio around $2 million after one of its stand-up performers was accused of insulting the Chinese military in a joke, and police in northern China detained a woman who had defended the comedian online.
  2. More than a dozen performances in China were abruptly canceled within a few days — including a Japanese choral band's tour, stand-up comedy shows in several cities and jazz shows in Beijing — some minutes before they were to begin and with virtually no explanation.
  3. Xi Jinping has made arts and culture a central arena for ideological crackdowns, demanding that artists align their creative ambitions with Chinese Communist Party goals and promote a nationalist vision of Chinese identity, with performers required to submit scripts or set lists for vetting.