Edward Conard

Top Ten New York Times Bestselling Author

  • “Unintended Consequences offers deep and well-argued analyses on almost every issue.” - The New York Times
  • “…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 fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…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
  • “…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 very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “…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 comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Wednesday, August 20, 2025

AI Summary. The author argues the housing affordability crisis stems from the sharp decline in 30-year fixed mortgage rates rather than their subsequent rise, since fixed rates let rate dips boost purchasing power, lifting existing-home sales 25% and prices 32% relative to rents. A costly data center buildout is crowding out for-sale housing.

Jason Thomas Carlyle Group
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Jason Thomas argues that high rates driven by the AI buildout and US fiscal policy are “crowding out interest-sensitive sectors like for-sale housing.”

Do falling mortgage rates, not rising ones, drive housing unaffordability?

Core argument: During the pandemic, U.S. existing-home sales rose 25% and house prices increased 32% relative to rents, which the author attributes to the sharp downward adjustment in rates in 2020–22 rather than their post-pandemic rise.

To speak of a rate-induced “affordability crisis” is no exaggeration. But this crisis resulted from the sharp downward adjustment in rates in 2020-22 rather than their post-pandemic rise. With implicit housing costs fixed over the entire term of residency, cyclical dips in 30-year rates boost purchasing power to an extent not observed with 2 floating rate loans. House prices and sales volumes rise predictably in response. During the pandemic, sales of existing homes rose 25% and house prices increased by 32% relative to rents. What the for-sale housing market really needs is a sharp reduction in interest rates. But the U.S. finds itself in the midst of a really expensive data center/supercomputer buildout. The issue is not whether high rates are “crowding out” interest-sensitive sectors like for-sale housing. Clearly, they are.

Takeaways by Macro Roundup® AI

  1. During the pandemic, U.S. existing-home sales rose 25% and house prices increased 32% relative to rents, which the author attributes to the sharp downward adjustment in rates in 2020–22 rather than their post-pandemic rise.
  2. Because implicit housing costs are fixed over the entire term of residency, cyclical dips in 30-year rates boost purchasing power to an extent not observed with floating-rate loans, and house prices and sales volumes rise predictably in response.
  3. The author argues that the for-sale housing market needs a sharp reduction in interest rates, but the United States is in the midst of an expensive data center and supercomputer buildout, with high rates crowding out interest-sensitive sectors such as for-sale housing.

Related Articles:

  • How America’s AI Boom Is Squeezing The Rest Of The Economy — About a sixth of America's 2% real GDP growth over the past year came from investment in computer and communications equipment and data centres, and one estimate puts the artificial intelligence boom's total contribution to growth at 40%. Average electricity bills rose 7%, attributed in part to data-centre demand, while housebuilding and non-AI business investment slumped and real consumption flatlined.
  • Rapidly Growing Treasury Supply Crowding Out Other Types of Credit Growth — Roughly half of all fixed income issuance coming to market over the past year has been US Treasuries, meaning investors must allocate a growing share of dollars to financing the government. The argument is that lower government debt would free up more funds for consumer borrowing and business investment.
  • Honey, AI Capex is Eating the Economy — Capital spending on AI data centers is around 20% of railroads' peak spending as a share of GDP and is rising quickly, having already surpassed the dot-com era peak in telecom investment. Unlike long-lived rail infrastructure, data centers are short-lived assets requiring frequent hardware replacement, and the capital is being reallocated from other sectors.

AI Summary. The authors argue that technological rivalry, measured by rival firms' research and development spending within an industry, raises obsolescence risk and shortens the period over which technology-specific adjustment costs can be recovered, making productive firms slower to expand employment. They estimate growing rivalry accounts for most of the decline in job reallocation.

Yoshiki Ando, James Bessen, and Xiupeng Wang Boston University School of Law
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Technological rivalry raises obsolescence risk, reducing the time over which adjustment costs can be recovered and thus reducing firm growth in response to innovation, reconciling an increase in the rate of innovation with a slowdown in aggregate TFP.

Does technological rivalry explain why productive firms hire more slowly?

Core argument: Over 1997–2018, growing technological rivalry, measured by R&D investment of other firms in the same industry, accounts for most of the decline in job reallocation, the authors find.

Why should firms become less responsive to productivity? Under standard labor demand models, a firm with a new productive idea (positive productivity shock) will seek to increase its employment to produce more. A new, higher level of productivity raises the firm’s target employment level, but adjustment costs tend to slow growth toward that target. This paper proposes a new factor that contributes to slower firm responsiveness: technological rivalry, measured by the magnitude of R&D investments by other firms in the same industry. Our insight is that technological rivalry exacerbates the effect of adjustment costs. Technological rivalry raises obsolescence risk, reducing the time over which technology specific adjustment costs can be recovered. [Over the period] 1997-2018, we find that growing technological rivalry accounts for most of the decline in job reallocation. Counterintuitively, rising technological rivalry may slow reallocation, dampening aggregate productivity growth.

Takeaways by Macro Roundup® AI

  1. Over 1997–2018, growing technological rivalry, measured by R&D investment of other firms in the same industry, accounts for most of the decline in job reallocation, the authors find.
  2. The authors argue that technological rivalry raises obsolescence risk, shortening the period over which technology-specific adjustment costs can be recovered and thereby exacerbating the effect of adjustment costs on firm growth.
  3. The paper proposes that rising technological rivalry may slow reallocation and dampen aggregate productivity growth.

Related Articles:

  • The Rising Returns to R&D: Ideas Are Not Getting Harder to Find — Using US Census Bureau micro-data on manufacturing, the authors estimate that both the output elasticity of research and development and its marginal returns have risen, alongside rising technological rivalry and obsolescence. They conclude ideas are not getting harder to find, but innovations are more transient, so rising R&D need not raise aggregate productivity growth.
  • The R&D Puzzle in U.S. Manufacturing Productivity Growth — Research and development spending in U.S. manufacturing has been rising relative to output and hours worked while productivity has been flat, which suggests the ability of research and development to boost productivity growth has been declining.
  • The Mysterious Slowdown in U.S. Manufacturing Productivity — US manufacturing labor productivity growth slowed broadly after the Great Recession, with the four largest firms in each industry averaging –0.5% growth from 2010 to 2022 versus 3.7% from 1987 to 2007, and smaller follower firms showing an identical 4.2 percentage-point decline. The authors find the slowdown spans all industries and firm sizes.

AI Summary. Foreign net inflows into long-term US assets, measured as a rolling 12-month sum, are at record highs, with equities showing particularly strong inflows. Flows into other asset classes are weaker but show no sign of an exodus from US assets.

Robin Brooks Robin Brooks Substack
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On a rolling one-year basis, foreign inflows into American assets hit a record high in June, driven by equity inflows, which offset directionally weaker foreign demand for Treasury notes and bonds.

Are foreign investors pulling out of US assets?

Core argument: Foreign net inflows into long-term US assets, measured as a rolling 12-month sum through June, stand at record highs, with equity inflows especially strong, which the analysis reads as growing market optimism on US growth.

The chart shows a rolling 12-month sum of foreign net inflows into long-term US assets. The latest data through June show very strong inflows into equities (purple) in particular, which points to growing market optimism on US growth. Foreign flows into other asset classes are weaker, but there is no sign of an exodus, which is what you might expect to see if you listen to the prevailing narrative on the US.

Takeaways by Macro Roundup® AI

  1. Foreign net inflows into long-term US assets, measured as a rolling 12-month sum through June, stand at record highs, with equity inflows especially strong, which the analysis reads as growing market optimism on US growth.
  2. Foreign flows into US asset classes other than equities are weaker but show no sign of an exodus, contrary to what the prevailing narrative on the US would imply.

Related Articles:

  • Why Is The Yield Curve Steepening? Because Of Coming Fed Cuts And Fiscal Challenges — The US yield curve is steepening across both the 2-to-10-year and 10-to-30-year segments. The article attributes this to Federal Reserve rate cuts, the risk that markets read those cuts as politically motivated and raise inflation expectations and long-term rates, and growing Treasury debt issuance pushing long rates up.
  • Are Foreigners Selling US Assets (Part II) — Proprietary flow tracking shows foreign bond flows into US assets, an outlier low in one month, have substantially normalized, suggesting an allocation shift away from dollar assets may have peaked. The authors argue traditional fundamentals, such as the US business cycle and Federal Reserve policy, will matter more for any further dollar weakness.
  • The US Trade Deficit and Foreign Borrowing — The authors argue US trade deficits persist because foreign investors find US financial assets attractive, but the current deficit level is not sustainable. They estimate that stabilizing the US net foreign liability position requires improving the trade balance by about 2% of GDP, or over 3% if low-cost borrowing privileges are lost.

AI Summary. Across the 30 states and Washington, D.C. that register voters by party, Democrats lost about 2.1m registered voters over a recent four-year period while Republicans gained 2.4m, cutting the Democratic registration edge from nearly 11 percentage points to just over 6. Republicans have also overtaken Democrats among new registrants.

Shane Goldmacher and Jonah Smith New York Times
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New voters are breaking Republican. In 2018, 34% of new voter registrations were Democrats and 20% GOP. By 2024, the GOP’s share of new voters rose 9pp relative to 2018 and the Democrats share declined 8pp, giving the GOP an edge among new registrants.

Are Democrats losing registered voters to Republicans across every party-registration state?

Core argument: Democrats lost about 2.1 million registered voters between the 2020 and 2024 elections across the 30 states plus Washington, D.C. with partisan registration, while Republicans gained 2.4 million, a four-year swing of 4.5 million voters.

Of the 30 states that track voter registration by political party, Democrats lost ground to Republicans in every single one between the 2020 and 2024 elections — and often by a lot. Democrats lost about 2.1 million registered voters between the 2020 and 2024 elections in the 30 states, along with Washington, D.C., that allow people to register with a political party. (In the remaining 20 states, voters do not register with a political party.) Republicans gained 2.4 million. That four-year swing toward the Republicans adds up to 4.5 million voters. Democrats went from nearly an 11-percentage-point edge over Republicans on Election Day 2020 in those places with partisan registration, to just over a 6-percentage-point edge in 2024. In 2018, Democrats accounted for 34% of new voter registrations nationwide, while Republicans were only 20%. Yet by 2024, Republicans had overtaken Democrats among new registrants. In six years, the G.O.P.’s share rose by 9 percentage points; the Democratic share dropped nearly 8 points. There are now roughly 160,000 fewer registered Democrats than on Election Day 2024, according to L2’s data, and 200,000 more Republicans.

Takeaways by Macro Roundup® AI

  1. Democrats lost about 2.1 million registered voters between the 2020 and 2024 elections across the 30 states plus Washington, D.C. with partisan registration, while Republicans gained 2.4 million, a four-year swing of 4.5 million voters.
  2. The Democratic registration edge over Republicans in states with partisan registration narrowed from nearly 11 percentage points on Election Day 2020 to just over 6 points in 2024, with Democrats losing ground in all 30 states.
  3. Democrats accounted for 34% of new voter registrations nationwide in 2018 against 20% for Republicans, but by 2024 Republicans had overtaken them, their share up 9 percentage points as the Democratic share fell nearly 8.

Related Articles:

  • Behind Trump’s 2024 Victory, a More Racially and Ethnically Diverse Voter Coalition — Republican support in the 2024 presidential election rose among Hispanic voters (48%, up from 36% in 2020), Black voters (15% from 8%), Asian voters (40% from 30%), and naturalized citizens (47% from 38%). Men backed Trump by 12 points (55%-43%) after splitting closely in 2020, with gains concentrated among men under 50.
  • What Happened In 2024 — Democratic two-way presidential support fell 3 points from 52% to 49% between the two most recent elections, with larger declines among overlapping demographic groups: 12 points among young Latinos, 16 among young Latino men, and 17 among young Latino men who vote irregularly.
  • Democrats Need to Face Why Trump Won — Among American voters over 30, the gender gap in presidential support has held at roughly 10%, but among those under 30 it has widened dramatically, with 18-year-old men 23 percentage points more likely than 18-year-old women to support Donald Trump. Similar divides are appearing in other countries.

AI Summary. China generates more electricity annually than the United States and European Union combined, having added capacity equivalent to the United Kingdom's total supply each year. Electricity makes up nearly 30% of China's energy use, versus 22% in the US and 21% globally, and its share is growing about 6% a year.

Dan Wang and Arthur Kroeber Foreign Affairs
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Electricity supplies nearly 30% of China’s energy use today and is growing at an annual rate of 6%. In the US, electricity accounts for 22% of energy use and is growing at an annual rate of 0.6%.

Is China becoming the world's first mainly electric economy?

Core argument: China has added power generation equal to the United Kingdom's entire supply every year for the past quarter century, and now generates more electricity annually than the United States and European Union combined.

Over the past quarter century, China has led the world in building power plants, adding the equivalent of the United Kingdom’s total supply every year. It now generates more electricity each year than the United States and the European Union combined. China is well on its way to becoming the world’s first economy powered mainly by electricity. Electricity accounts for 21% of energy use in the world as a whole and 22% of energy use in the United States. In China, electricity is nearly 30% of energy use, more than in any other large country except Japan. And this share is growing fast: about six percent a year, compared with 2.6 percent for the world as a whole and 0.6% for the United States.

Takeaways by Macro Roundup® AI

  1. China has added power generation equal to the United Kingdom's entire supply every year for the past quarter century, and now generates more electricity annually than the United States and European Union combined.
  2. Electricity accounts for nearly 30% of China's energy use, more than any other large country except Japan, against 22% in the United States and 21% worldwide.
  3. China's electricity share of energy use is growing about 6% a year, compared with 2.6% for the world and 0.6% for the United States, putting China on course to become the world's first economy powered mainly by electricity.

Related Articles:

  • How Xi Sparked China’s Electricity Revolution — Electricity has risen to 30% of China's final energy use while plateauing near 22% in Europe and the US, supported by a decades-long grid expansion and upgrade program projected to cost as much as $800bn by 2030. Chinese grid investment is forecast to grow about 5% annually through 2030, faster than projected economic growth.
  • Heliocentrism — An energy use must be electrified before green grid electricity can decarbonize it, and while US grid decarbonization continues at a steady pace, the electricity share of final US energy consumption has grown little. Transmission line growth runs well below Department of Energy targets for 2030 and 2035, and transformer delivery times have stretched from 4–6 weeks to 2–3 years.
  • Xi Ties His Legacy and China’s Economy to $167 Billion Dam — China's $167bn hydropower project on the Yarlung Tsangpo river in Tibet, where the river drops more than 2,000 meters over a 50-kilometer stretch, has a potential capacity as high as 70 gigawatts. That could generate 300 terawatt-hours a year, roughly equal to the UK's total annual electricity use.

AI Summary. China's National Bureau of Statistics reported that urban unemployment among 16-24 year-olds excluding students rose to 17.8% from 14.5%, ending four straight months of decline. A record 12.2m university students are graduating into a job market where many have had trouble finding positions matching their education and skill levels.

Xinyi Wu South China Morning Post
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China’s youth unemployment (16–24) rose to 17.8% in July. 12.2mm college students will graduate this summer and enter the labor force.

Is China's youth unemployment rising as record graduates enter the workforce?

Core argument: China's urban jobless rate for 16–24 year-olds excluding students rose to 17.8% in July from 14.5% in June, the highest level since last August, according to National Bureau of Statistics data.

China’s youth unemployment rate rose to its highest level in 11 months in July, as a record number of graduates enter an already shaky labour market. The urban jobless rate for the 16-24 age group, excluding students, rose to 17.8% last month from 14.5% in June, putting an end to four straight months of decline and marking the metric’s highest level since last August, according to data released by the National Bureau of Statistics on Tuesday. The figures come as a record 12.2 million university students graduate this summer, with a majority of them joining a sizeable applicant pool that has had trouble finding open positions that meet their education and skill levels.

Takeaways by Macro Roundup® AI

  1. China's urban jobless rate for 16–24 year-olds excluding students rose to 17.8% in July from 14.5% in June, the highest level since last August, according to National Bureau of Statistics data.
  2. The July increase in China's youth unemployment rate ended four straight months of decline in the metric.
  3. A record 12.2 million Chinese university students graduate this summer, with a majority joining an applicant pool that has had trouble finding open positions matching their education and skill levels.

Related Articles:

  • China Already Had a Graduate Jobs Crisis. The Trade War is Making it Worse — China's graduate job market faces multiple simultaneous pressures, including a real estate slump, tighter financial-sector regulation with pay cuts and layoffs, and cautious private-sector hiring. Major state banks have cut graduate recruitment sharply, with Agricultural Bank of China planning 4,530 hires, down 68.9%, and Industrial and Commercial Bank of China down 47%.
  • China is Suffering its Own ‘China Shock’ — Academic analysis of 12 labour-intensive Chinese manufacturing industries estimates average employment fell about 14%, or nearly 4mn jobs, between 2011 and 2019, with textile roles down 40%; a further analysis of the same sectors found 3.4mn more jobs lost through 2023. Researchers argue industrial upgrading and automation are cutting demand for lower-skilled workers and depressing their wages.
  • Our Revamped China Wage Tracker Shows Gradual Softening in Wage Growth — A revamped wage tracker estimates China's wage growth slowed to 4.2% year-over-year in the first quarter and 3.9% in the second, down from 4.5% in the prior fourth quarter and about 1 percentage point below official figures. The authors argue sluggish wage growth may weigh on consumption growth.

Thursday, August 21, 2025

AI Summary. The S&P 500 has outperformed other developed-market equities by a cumulative 150% over the past fifteen years, but the authors attribute about 80% of that gap to a strengthening dollar and expanding relative valuations rather than fundamentals such as dividends, buybacks, and organic growth. U.S. valuations sit around the 90th percentile on price-to-earnings measures.

Ben Inker and John Pease GMO
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Inker and Pease argue that 80% of the S&P’s outperformance relative to advanced economies since 2010 arose from two sources that are unlikely to repeat: dollar strengthening and near all-time high valuation ratios, which “always beggar future returns.”

Has U.S. stock outperformance come from fundamentals or currency and valuation gains?

Core argument: The S&P 500 has beaten the rest of developed market equities by a cumulative 150% over fifteen years, but about 80% of that outperformance came from dollar strength and expanding relative valuations rather than fundamentals.

The S&P 500 has outpaced the rest of developed market equities by a cumulative 150% in the past fifteen years. If we start the clock in December 2014 instead of December 2010, the U.S. fundamentally outperformed the rest of the developed markets by a smidge: an aggregate 3.8%. Fast-forward to December 2019, and the fundamental outperformance since then is nil. Exhibit 1 does not deliver a ringing endorsement of U.S. equities. About 80% of their outperformance came from sources of return that are unlikely to repeat: the dollar strengthening against almost every currency in the world and relative valuations expanding. The dollar is already very expensive, and the U.S. administration is pushing for trade and monetary policies that actively make it less attractive for foreigners to hold dollar assets. U.S. valuations are already somewhere between the 90th percentile on simple ratios like P/E and closer to their all-time records when contrasted with the opportunity cost of investing in other assets (like Treasuries). It pays to remember that higher valuations always beggar future returns, though U.S. stocks did deliver on fundamental returns [dividends, share repurchases, and organic growth].

Takeaways by Macro Roundup® AI

  1. The S&P 500 has beaten the rest of developed market equities by a cumulative 150% over fifteen years, but about 80% of that outperformance came from dollar strength and expanding relative valuations rather than fundamentals.
  2. Measured from December 2014, U.S. fundamental outperformance versus other developed markets totals 3.8%, and measured from December 2019 it is nil.
  3. U.S. valuations sit around the 90th percentile on simple ratios like P/E and closer to all-time records when contrasted with the opportunity cost of assets such as Treasuries, and higher valuations always beggar future returns.

Related Articles:

  • Summer Mailbag — The share of total US market capitalization held by young unprofitable companies has fallen from its 2021–2022 peak, while over 40% of small-cap companies have negative earnings and the negative-earnings share among large caps is falling. The 10 largest stocks hold about 35% of market cap, a high since 1990, but their share of market earnings has roughly kept pace.
  • AI Is Holding Up the Sky. The Rest Fell Back to Earth — The equal-weight S&P 500, which treats every company as 0.2% of the index, has hit its weakest performance relative to the market-cap-weighted index in 22 years, as a small group of companies captures a large share of profits. Big Tech's capital spending on AI computing and energy has surged, leaving little free cash flow for buybacks or dividends.
  • Long-Term Shareholder Returns: Evidence From 64,000 Global Stocks — A study of about 64,000 global stocks estimates net global stock market wealth creation of $75.7tn, with returns highly concentrated: the top 159 firms (0.25%) account for half of net wealth creation and the top 1,526 (2.39%) account for all of it. Fewer than half of stocks beat one-month US Treasury bills, 42.6% of non-US and 44.8% of US stocks.

AI Summary. The author estimates U.S. GDP was about 0.2%–0.3% larger than it would have been had business spending on data center construction, computers, and communications equipment grown in line with its earlier trend, and about 0.6% larger if the capital spending of Amazon, Google, Meta, Microsoft, and Oracle were fully captured in official data.

Matt Klein The Overshoot
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Examining official data and company financials, Matt Klein estimates “U.S. GDP would be about 0.4% higher than currently reported…if the [capex] of Amazon, Google, Meta, Microsoft, and Oracle were fully incorporated into the official data.”

How much has AI-related capital spending added to GDP?

Core argument: U.S. GDP was about 0.2%–0.3% larger in 2025Q2 than it would have been had business spending on data center construction, computers and peripheral equipment, and communications equipment grown in line with its 2011Q1–2022Q3 trend.

GDP was about 0.2%-0.3% larger in 2025Q2 than it would have been if businesses’ spending on data center construction, computers and peripheral equipment, and communications equipment had grown in line with the 2011Q1-2022Q3 trend. Moreover, this impact is likely understated, because existing methodologies are (probably) not fully capturing the investment being done by the five companies responsible for the bulk of the data center buildout: Amazon, Google, Meta, Microsoft, and Oracle. I estimate that U.S. GDP would be about 0.4% higher than currently reported—or about 0.6% higher than if there had been no AI boom—if the capital expenditures of the big 5 were fully incorporated into the official data. Or put yet another way, the growth in direct AI-related capex by the big 5 since mid-2023 would correspond to about 10% of the total increase in the dollar value of U.S. GDP over the past two years. Including additional capital spending on power plants and electricity generation would lead to an even larger number.

Takeaways by Macro Roundup® AI

  1. U.S. GDP was about 0.2%–0.3% larger in 2025Q2 than it would have been had business spending on data center construction, computers and peripheral equipment, and communications equipment grown in line with its 2011Q1–2022Q3 trend.
  2. U.S. GDP would be about 0.4% higher than currently reported, or about 0.6% higher than with no AI boom, if the capital expenditures of Amazon, Google, Meta, Microsoft, and Oracle were fully incorporated into official data, by one estimate.
  3. Growth in direct AI-related capital expenditure by Amazon, Google, Meta, Microsoft, and Oracle since mid-2023 would correspond to about 10% of the total increase in the dollar value of U.S. GDP over the past two years.

Related Articles:

  • Honey, AI Capex is Eating the Economy — Capital spending on AI data centers is around 20% of railroads' peak spending as a share of GDP and is rising quickly, having already surpassed the dot-com era peak in telecom investment. Unlike long-lived rail infrastructure, data centers are short-lived assets requiring frequent hardware replacement, and the capital is being reallocated from other sectors.
  • Is AI Hitting A Wall? — Artificial intelligence gains have come from a formula of more data and more computing power, but companies have exhausted freely available internet training data and are now striking data-sharing deals with publishers and copyright holders. Training and running large models is energy-intensive, requiring vastly more Nvidia chips with each generation.
  • AI Adoption Is Accelerating In 2025 — Nvidia's data center revenue growth is used as a simple extrapolation to project the broader capital-expenditure impact of AI-specific investment on GDP. The aim is not precision but a timely sense of whether the growth contribution from AI capital spending is accelerating or potentially peaking.

AI Summary. U.S. developers plan to bring 64 GW of new electric generating capacity online in a single year, with utility-scale solar accounting for more than half and battery storage, wind, and natural gas making up virtually all the rest. That would exceed the prior record of 58 GW, of which 57 GW was natural gas.

EIA Staff Energy Information Administration
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If US developers’ plans are realized, they will bring online a record 64 GW of new power in 2025, with solar accounting for 50%. That would surpass the previous record of 58 GW of new energy brought online in 2002, of which 98% was fueled by natural gas.

Does solar account for over half of new U.S. generating capacity?

Core argument: U.S. developers added 12 GW of utility-scale solar in the first half of 2025 and plan another 21 GW in the second half, which would make solar more than half of the 64 GW planned for the year.

Developers added 12 gigawatts (GW) of new utility-scale solar electric generating capacity in the United States during the first half of 2025, and they plan to add another 21 GW in the second half of the year, according to our latest survey of electric generating capacity changes. If those plans are realized, solar would account for more than half of the 64 GW that developers plan to bring online this year. Battery storage, wind, and natural gas power plants account for virtually all of the remaining capacity additions for 2025. Developers could set a record for capacity additions if all 64 GW come online this year. The previous record for U.S. generating capacity additions was set in 2002, when developers added 58 GW to the grid, 57 GW of which was fueled by natural gas.

Takeaways by Macro Roundup® AI

  1. U.S. developers added 12 GW of utility-scale solar in the first half of 2025 and plan another 21 GW in the second half, which would make solar more than half of the 64 GW planned for the year.
  2. If all 64 GW of planned 2025 additions come online, U.S. developers would set a record for generating capacity additions, surpassing the 58 GW added in 2002, of which 57 GW was natural gas-fueled.
  3. Battery storage, wind, and natural gas plants account for virtually all U.S. capacity additions planned for 2025 outside of solar.

Related Articles:

  • Heliocentrism — An energy use must be electrified before green grid electricity can decarbonize it, and while US grid decarbonization continues at a steady pace, the electricity share of final US energy consumption has grown little. Transmission line growth runs well below Department of Energy targets for 2030 and 2035, and transformer delivery times have stretched from 4–6 weeks to 2–3 years.
  • Economic Growth Now Depends on Electricity, Not Oil — Average annual electricity load growth reached 3% and is projected to continue at that rate for five years, with utilities raising expected peak demand for 2029 by 12%, or 101 gigawatts, driven by data centers, new factories, electric vehicles, heat pumps, and hydrogen production.
  • Electricity 2025 — US electricity demand is projected to grow about 2% annually over 2025-2027, an upward revision from an earlier 1% forecast. A study commissioned by the US Department of Energy found data centre electricity use rose from about 60 TWh in 2014 to 176 TWh in 2023, and could reach 325-580 TWh by 2028.

AI Summary. Analysis of 236,000 respondents in a US government time-use survey found the share of Americans who read for pleasure on an average day fell from 28% to 16% over two decades. The measure counted any reading for enjoyment, including print books, newspapers, magazines, ebooks and audiobooks.

Clive Cookson Financial Times
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An analysis of data from the American Time Use Survey documents a 43% reduction in the percentage of Americans who read for pleasure on an average day over a 20-year period, from 28% in 2003 to 16% in 2023.

Has the share of Americans reading for pleasure declined sharply?

Core argument: The share of Americans who read for pleasure on an average day fell from 28% in 2003 to 16% in 2023, a decline of roughly 40%, according to researchers at the University of Florida and University College London.

Analysing data from the US government’s American Time Use Survey, researchers at the University of Florida and University College London found that of the 236,000 Americans surveyed the proportion who read for pleasure on an average day fell from 28% in 2003 to 16% in 2023. The study included any kind of reading done for enjoyment or purposes other than work or school, including ebooks on screen or listening to audiobooks, as well as traditional books, newspapers and magazines in print. Although electronic media have added many new ways to read, the researchers expressed confidence in their methodology.

Takeaways by Macro Roundup® AI

  1. The share of Americans who read for pleasure on an average day fell from 28% in 2003 to 16% in 2023, a decline of roughly 40%, according to researchers at the University of Florida and University College London.
  2. The study drew on the US government's American Time Use Survey covering 236,000 Americans and counted any reading done for enjoyment rather than work or school, including print books, newspapers, magazines, ebooks and audiobooks.
  3. The researchers expressed confidence in their methodology, despite electronic media adding many new ways to read.

Related Articles:

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  • Have Humans Passed Peak Brain Power? — The share of Americans reporting they read a book in the past year has fallen below half, alongside declining performance in numeracy and problem-solving in most countries. The share of adults unable to use mathematical reasoning to evaluate the validity of statements averages 25% in high-income countries and 35% in the US.
  • Many Children Left Behind: The 2024 National Assessment of Educational Progress Results Indicate a Five-Alarm Fire — The share of US fourth-grade students meeting the National Assessment of Educational Progress reading proficiency standard fell from 35% in 2019 to 33% in 2022 and 30% in 2024. More fourth-graders now score below the basic level than score proficient.

AI Summary. The US population is split evenly among urban, suburban, and rural areas, but 64% of those living at suburban densities reside in prosperous or comfortable ZIP codes, versus 36% in rural and 38% in urban ones. County distress scores correlate strongly with life expectancy, with prosperous counties averaging 5.3 years longer.

Kenan Fikri and Sarah Eckhardt Agglomerations
Date Posted:

An analysis of census data finds residents of the mean “prosperous” (top-quintile) county live 5.3 years longer than those in the mean “distressed” (bottom-quintile) one, with the discrepancy between the top and bottom percentiles widening to 8 years.

Do suburban areas concentrate America's prosperity and longer life expectancy?

Core argument: 64% of the U.S. population living at semi-urban (suburban) densities resides in prosperous or comfortable ZIP codes, far above the 36% in rural areas and 38% in urban ones.

Nationally, the country’s population is evenly divided between urban, semi-urban (which we’ll call suburban), and rural areas. Fully 55% of the population in top-tier ZIP codes live at suburban densities, compared to only 20% in the bottom (distressed) tier. Put differently, fully 64% of the U.S. population living at semi-urban densities reside in prosperous or comfortable zip codes (Figure 2). That is far and above the 36% in rural areas or 38% in urban ones. County distress scores are strongly correlated with life expectancy. Residents of the average prosperous county live over five years longer (5.3 years to be exact) than those in the average distressed one, widening to 8 years in the top and bottom percentiles.

Takeaways by Macro Roundup® AI

  1. 64% of the U.S. population living at semi-urban (suburban) densities resides in prosperous or comfortable ZIP codes, far above the 36% in rural areas and 38% in urban ones.
  2. 55% of the population in top-tier ZIP codes lives at suburban densities, compared with 20% in the bottom, distressed tier, while the country overall splits evenly among urban, suburban, and rural areas.
  3. County distress scores are strongly correlated with life expectancy, with residents of the average prosperous county living 5.3 years longer than those in the average distressed county, widening to 8 years between top and bottom percentiles.

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  • “Compensate the Losers?” Economic Policy and Partisan Realignment in the US — The authors argue that partisan realignment by education reflects Democrats' declining supply of "predistribution" policies such as job guarantees, higher minimum wages, protectionism, and stronger unions, which less-educated Americans favor while more-educated Americans prefer taxes and transfers. They estimate changing views of the parties' economic policies explain roughly half the shift.
  • The Economic Geography Of The 2024 Elections — Counties where government transfer programs such as Social Security, Medicare, Medicaid, and unemployment insurance make up at least a quarter of personal income gave Trump 63% of the vote, while counties where transfers account for less than 15% gave Harris 56%. Transfers supplied 18% of total US personal income.

AI Summary. Chinese regulators including the Cyberspace Administration of China reportedly sought ways to restrict domestic technology companies from buying Nvidia's H20 artificial-intelligence processors, after US officials said America sells China neither its best nor second-best chips and aims to get Chinese developers hooked on the American technology stack.

Zijing Wu and Cheng Leng Financial Times
Date Posted:

Chinese regulators have mobilized to dissuade China’s tech companies from acquiring Nvidia’s H20 chip. As a result, domestic tech groups are holding off or downsizing their H20 orders.

Do US remarks about downgraded chip exports prompt Chinese purchase restrictions?

Core argument: China's Cyberspace Administration, National Development and Reform Commission and Ministry of Industry and Information Technology sought ways to restrict Chinese tech groups from buying Nvidia's H20 chips, according to people with knowledge of the regulatory decision-making.

According to people with knowledge of the regulatory action, the Cyberspace Administration of China (CAC), the National Development and Reform Commission (NDRC) and the Ministry of Industry and Information Technology (MIIT) moved in response to comments made by Lutnick last month. “We don’t sell them our best stuff, not our second-best stuff, not even our third-best,” Lutnick told CNBC on July 15, the day after the Trump administration lifted export controls, implemented in April, on H20 sales. “You want to sell the Chinese enough that their developers get addicted to the American technology stack, that’s the thinking,” he added. Some of China’s senior leaders found the comments “insulting”, leading the policymakers to seek ways to restrict Chinese tech groups from buying the processors, according to two people with knowledge of the latest regulatory decision-making.

Takeaways by Macro Roundup® AI

  1. China's Cyberspace Administration, National Development and Reform Commission and Ministry of Industry and Information Technology sought ways to restrict Chinese tech groups from buying Nvidia's H20 chips, according to people with knowledge of the regulatory decision-making.
  2. Howard Lutnick told CNBC on July 15, the day after the Trump administration lifted April export controls on H20 sales, that the US sells China neither its best, second-best nor third-best technology, aiming for Chinese developers to get "addicted to the American technology stack".
  3. Some of China's senior leaders found Lutnick's comments "insulting", leading policymakers to seek restrictions on purchases of the processors, according to two people with knowledge of the regulatory decision-making.

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  • China Wants US To Relax Export Controls On Chips As Part Of Trade Deal — China is seeking relief from US semiconductor export controls as part of a trade deal, and people familiar with the matter say Beijing is more concerned about restrictions on high-bandwidth memory chips than about the H20 chip Nvidia designed for the Chinese market. Those memory controls constrain Chinese companies' ability to develop their own AI chips.
  • China Has Its Own Concerns About Nvidia H20 Chips — China's leaders cite security concerns, including suspicion of hidden back doors in US-designed chips, as a rationale for their drive toward chip self-sufficiency. The dilemma extends beyond chips: US intelligence reportedly found extra modems on Chinese-made port cranes, and the US has banned Chinese components from connected auto systems.
  • The Goal for China’s Chip Giant: Cut Out the U.S. — Huawei's Mate 60 smartphone contained a system-on-chip made with SMIC technology comparable to the 7-nanometer process, despite Chinese chipmakers lacking access to ASML's most advanced lithography machines. Semiconductor engineers say the chips were likely made by exposing silicon to light multiple times, a technique that worsens yields and raises costs and becomes harder at more advanced nodes.