Edward Conard

Top Ten New York Times Bestselling Author

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

Macro Roundup


Wednesday, September 10, 2025

AI Summary. U.S. median household income was $83,730, not statistically different from the prior year's $82,690, according to Census Bureau estimates. Across most demographic subgroups, median household income was higher or not statistically different from the prior year, with the exception of Black households, which saw a decline.

Melissa Kollar and Zach Scherer U.S. Census Bureau
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Real median household income was $83,730 in 2024, effectively flat from 2019’s $83,260.

Did median household income change over the past year?

Core argument: Median U.S. household income was $83,730 in 2024, not statistically different from the 2023 estimate of $82,690.

This report provides estimates of household income, income inequality, and worker earnings in the United States for 2024. Median household income was $83,730 in 2024, not statistically different from the 2023 estimate of $82,690. For most demographic subgroups analyzed, the median household income estimates in 2024 were either higher or not statistically different from 2023, with the exception of Black households, which experienced a decline in median household income.

Takeaways by Macro Roundup® AI

  1. Median U.S. household income was $83,730 in 2024, not statistically different from the 2023 estimate of $82,690.
  2. Across most demographic subgroups analyzed, 2024 median household income estimates were either higher than or not statistically different from 2023.
  3. Black households were the exception among the subgroups analyzed, experiencing a decline in median household income.

Related Articles:

  • Trends in the Distribution of Family Wealth, 1989 to 2022 — The Congressional Budget Office estimates that the top 10% of U.S. families held 60% of all wealth in 2022, up from 56% in 1989, with the top 1% holding 27%, up from 23%. The rest of the top half saw its share fall from 37% to 33%, while the bottom half held 6% in both years.
  • The Era of Big Raises for Low-Paid Workers Is Over — Wage growth for the bottom quarter of US earners was 3.7%, around the lowest since 2017, versus 4.7% for the top quarter, according to the Federal Reserve Bank of Atlanta. Bank of America customer data show after-tax pay up 1.6% year-over-year for the bottom third of households versus 2.9% for the top third.
  • The Unexpected Compression: Competition at Work in the Low Wage Labor Market — Labor market tightness produced an unexpected compression in the US wage distribution, with disproportionate wage growth at the bottom reducing the college wage premium and reversing nearly 40% of the rise in 90-10 wage inequality since 1980. The authors attribute this in part to increased competition for low-wage workers.

AI Summary. Central banks' gold accumulation is generally not associated with reducing the dollar's share of international reserves at the country level, apart from a few prominent cases, and is more consistent with modest overall diversification. Gold's role as an official-sector store of value has grown, but its use as a unit of account and medium of exchange remains limited.

Colin Weiss Federal Reserve Board
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Gold as a share of world central bank reserves increased from ~12% to ~17% btw 2000–2024. Weiss argues this is part of “diversification not solely aimed at the dollar share” and there has been little erosion of the dollar’s role in invoicing and trade.

Does central bank gold buying signal a retreat from the dollar?

Core argument: Central bank gold accumulation is generally not associated with de-dollarization of international reserves at the country level, except in a few prominent cases, the author argues from data on reserve currency composition and official sector purchases of U.S. assets.

I examine how governments have managed their holdings of gold and dollar reserves in recent decades, a period when gold’s share of aggregate international reserves rose and the dollar’s share fell. Using data on central banks’ reserve currency composition and official sector purchases of U.S. assets, I argue that gold reserve accumulation is generally not associated with de-dollarization of international reserves at the country level, except in a few prominent cases. Instead, gold purchases are more consistent with most countries pursuing a modest diversification of international reserves that does not solely target a reduced dollar share. My evidence suggests that this characterization also applies to gold reserve accumulation in 2022 and 2023. Finally, I show that, while gold’s importance as a store of value for the official sector has grown since 2000, its use as a unit of account and a medium of exchange remains limited.

Takeaways by Macro Roundup® AI

  1. Central bank gold accumulation is generally not associated with de-dollarization of international reserves at the country level, except in a few prominent cases, the author argues from data on reserve currency composition and official sector purchases of U.S. assets.
  2. Gold's share of aggregate international reserves rose while the dollar's share fell in recent decades, a pattern the author reads as most countries pursuing modest reserve diversification rather than solely targeting a reduced dollar share, including in 2022 and 2023.
  3. Gold's importance as a store of value for the official sector has grown since 2000, while its use as a unit of account and a medium of exchange remains limited.

Related Articles:

  • All That Glitters Is Cognitive Dissonance — Gold has risen more than 37% over the year, its strongest annual showing in more than three decades and a plausible path toward $4,000 an ounce, even as the Nasdaq Composite Index sets records. Central bank accumulation has been crucial, with gold purchases topping 1,000 tons for a third consecutive year.
  • Taking Stock: Dollar Assets, Gold, and Official Foreign Exchange Reserves — Gold accounts for about 10% of aggregate official foreign exchange reserves, roughly its level in the early 2000s. International Monetary Fund country data indicate most added official gold holdings came from a few central banks, with over half of reported accumulation from China and Russia and about a quarter from several emerging markets.
  • How Gold Became the World’s Refuge from Uncertainty — Gold prices reached a record intraday high in real terms, surpassing the prior 1980 peak, with roughly a 30% gain over the year. Central banks have bought more than 1,000 tonnes net annually for three years — record levels — led by emerging markets including China, India and Turkey as they scale back dollar exposure.

AI Summary. Computer and electronic products manufacturers import 37% of their intermediate inputs and capital equipment, chemical manufacturers 33%, and transportation equipment manufacturers 27%. Broad tariffs may push some sourcing domestically over time, but many inputs will simply cost more, making American manufacturers less competitive globally.

Jiaxin He and Connor O'Brien Agglomerations
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US advanced manufacturers import between 27% and 39% of their intermediate inputs and capital equipment. Jiaxin He and Connor O’Brien argue tariffs “are likely to backfire, raising costs for American factories and slowing reindustrialization.”

Do broad tariffs make high-tech manufacturers less competitive globally?

Core argument: Computer and electronic products manufacturers import 37% of their intermediate inputs and capital equipment.

Computer and electronic products manufacturers import 37% of their intermediate inputs and capital equipment. Chemical manufacturers — primarily pharmaceutical and petrochemical firms — import 33% of their inputs and equipment. Transportation equipment manufacturers — producers of ships, trains, planes, and military vehicles — import 27%. High and broad tariffs may result in American manufacturers sourcing more inputs domestically over time. But many inputs will simply become more expensive, making domestic manufacturers less competitive globally.

Takeaways by Macro Roundup® AI

  1. Computer and electronic products manufacturers import 37% of their intermediate inputs and capital equipment.
  2. Chemical manufacturers, primarily pharmaceutical and petrochemical firms, import 33% of their inputs and equipment, while transportation equipment producers of ships, trains, planes, and military vehicles import 27%.
  3. High and broad tariffs may push American manufacturers to source more inputs domestically over time, but many inputs will simply become more expensive, making domestic manufacturers less competitive globally.

Related Articles:

AI Summary. Foreign portfolio inflows into China have been flat for the past three years following large outflows, while non-China emerging markets have seen a strong rebound in non-resident portfolio inflows. After earlier global market shocks, flows into China rebounded strongly; the most recent bounce back has been far shallower.

Robin Brooks Robin Brooks Substack
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Since Russia’s 2022 invasion of Ukraine, China, unlike other emerging markets, has seen muted capital inflows. Robin Brooks argues this suggests investors are “putting a greater weight on geopolitical risk in the case of China.”

Are foreign portfolio flows into China lagging other emerging markets?

Core argument: Foreign portfolio inflows into China have been flat for the past three years following large outflows in 2022, measured as a rolling four-quarter moving average of non-resident flows scaled by dollar-denominated GDP.

The left chart aggregates up quarterly non-resident portfolio flows into the world’s top 25 emerging markets. The chart aggregates these flows by region, makes a rolling four-quarter moving average and divides this by the Dollar-denominated GDP for all these countries. I’ve denoted key turning points in global markets, like the start of the global financial crisis in Q1 2008, China’s RMB devaluation scare in Q3 2015 and the invasion of Ukraine in Q1 2022. After the first two of these turning points, non-resident flows to China (red bars) bounce back strongly, but the invasion of Ukraine is clearly different. The bounce back is far shallower and - factoring in big outflows in 2022 - foreign portfolio inflows into China have been flat for the past three years. This contrasts with non-China EM, where non-resident portfolio inflows continue to look healthy. The right chart is exactly the same as the left, except that it drops China from the numerator (flows) and the denominator (GDP). It turns out that non-China EM has seen a strong rebound in non-resident portfolio inflows, which makes tepid flows into China even more notable.

Takeaways by Macro Roundup® AI

  1. Foreign portfolio inflows into China have been flat for the past three years following large outflows in 2022, measured as a rolling four-quarter moving average of non-resident flows scaled by dollar-denominated GDP.
  2. Non-resident portfolio inflows to emerging markets excluding China have rebounded strongly, in contrast to the tepid flows into China.
  3. After the Q1 2008 onset of the global financial crisis and China's Q3 2015 RMB devaluation scare, non-resident flows to China bounced back strongly, but the rebound following the Q1 2022 invasion of Ukraine was far shallower.

Related Articles:

  • World’s Top Hedge Fund Bridgewater Dumps All China Stocks In Retreat From Market — Hedge fund Bridgewater exited positions in 16 Chinese stocks worth a combined $1.41bn and closed its indirect exposure through China-focused exchange-traded funds, according to its US regulatory filing. The firm shifted toward US mega-cap technology stocks, raising its stakes in Nvidia by 154%, Microsoft by 112%, Meta Platforms by 90% and Alphabet by 84%.
  • How China’s New Naval and Air Sites Would Aid an Attack on Taiwan — Satellite images and other open-source material examined by The Wall Street Journal show China building air and naval facilities along its eastern coast, including a large base for amphibious warships and a multibillion-dollar airport about 3 miles from front-line Taiwanese islands. Analysts say the sites would strengthen China's position in an invasion of Taiwan.
  • Buffett Praises BYD and TSMC After Selling Shares of Both Firms — Berkshire Hathaway reduced its stake in Taiwan Semiconductor Manufacturing by 86%, a sale that could have fetched $3.7bn at the average share price over the period. The decision was attributed to concerns over geopolitical tensions between China and Taiwan, not to any reassessment of the business or its management.

Thursday, September 11, 2025

AI Summary. A model of forward interest rate curves, projected deficits, and debt maturity structures estimates that government interest spending on marketable debt will rise across G10 economies by an average of 0.5 percentage points of GDP by 2029, with France, Japan, and the United States facing the largest increases.

George Cole Goldman Sachs
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Goldman finds shortening the weighted average maturity (WAM) of debt would have a “limited effect” in lowering the interest burden. Given the current US term structure, one added rate cut would have a bigger effect than a 2-year shortening of WAM.

How much will government interest costs rise across advanced economies?

Core argument: The authors estimate interest spending on marketable debt will rise by an average of 0.5pts of GDP across G10 economies by 2029, based on the current forward curve, projected deficit paths, and existing weighted average maturities.

To project future government interest costs, we build a model based on future interest rate curves, the path for future deficits, and the term structure of future debt issuance. Using the current forward curve, projected deficit paths, and existing WAMs, we can estimate a baseline rise in interest rate costs over time. Using this model we estimate that interest rate spending on marketable debt will rise across G10 economies on average by 0.5pp of GDP by 2029. Although the increase varies, we estimate countries such as France, Japan, and the United States will face the largest increases in higher interest costs given the future path for deficits, debt, and the current forward curve. We observe that reducing the policy rate has a stronger impact on reducing the increase in interest costs in the US where a 100bp of additional cut could reduce the interest cost increase by 0.51pp of GDP. The US had the lowest sensitivity to a change in WAM: adding just an additional cut would have a stronger effect than actively reducing the WAM by 2 years. Combining these measures would result in a bigger saving.

Takeaways by Macro Roundup® AI

  1. The authors estimate interest spending on marketable debt will rise by an average of 0.5pts of GDP across G10 economies by 2029, based on the current forward curve, projected deficit paths, and existing weighted average maturities.
  2. France, Japan, and the United States face the largest projected increases in interest costs, according to the authors' model of future rate curves, deficit paths, and debt term structure.
  3. The authors estimate an additional 100bp of policy rate cuts would reduce the U.S. interest cost increase by 0.51pts of GDP, a stronger effect than reducing the weighted average maturity by 2 years, with the U.S. showing the lowest sensitivity to maturity changes.

Related Articles:

  • Fed Rate Cuts Won’t Make Long Yields Fall — Markets have moved to price 125 basis points of Federal Reserve rate cuts, double the amount priced earlier, yet the 30-year Treasury yield has risen from 4.78% to 4.92%, showing policy rate cuts need not lower long-term yields. The author argues doubts about Federal Reserve independence could raise long yields further through higher risk premia.
  • Data Update 4 for 2025: Interest Rates, Inflation and Central Banks! — Interest rates are ultimately driven by macroeconomic fundamentals, with an "intrinsic risk-free rate" defined as the sum of the inflation rate and real GDP growth tracking the observed 10-year Treasury bond yield closely. On this view, central banks' influence comes from preferential access to data on those fundamentals, their capacity to alter them, and their credibility.
  • Our Thoughts on Large US Deficits and Their Impact on Bond Yields — Total borrowing in the US is about average despite high government deficits, as high public borrowing has contributed to the need for higher interest rates that have depressed private sector borrowing. Risk premiums on long-dated debt look about average, with no market signs that economic or debt limits are currently being hit.

AI Summary. Short- and medium-term US government bond yields have fallen more than the forward yields markets price for the 10-year rate 10 and 20 years ahead. The author argues this indicates upward pressure on longer-term yields persists, only partly offset by US recession fears.

Robin Brooks Robin Brooks Substack
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While 2-year yields are falling as “expectations for more Fed cuts are building,” Brooks notes the back of the yield curve isn’t “falling nearly as much, a sign that the debt glut remains very much top of mind for markets.”

Are long-term bond yields falling as much as shorter-term yields?

Core argument: From August 21, the day before Chair Powell's dovish Jackson Hole speech, the US 2-year yield fell 25 basis points and the 10-year fell 28, while the 10y10y forward fell 22 basis points and the 10y20y forward 16.

The chart shows government bond yields, where I use 10-, 20- and 30-year yields to construct a 10y10y forward (pink) and 10y20y forward (orange) yield. These yields are what markets price for the 10-year yield 10 and 20 years from now. It’s clear that the 2-year yield (black) is falling sharply, as expectations for more Fed cuts are building. The 10-year yield (blue) is also falling, but the 10y10y and 10y20y forward yields aren’t falling nearly as much. Looking at this from August 21 (the day before Chair Powell’s very dovish speech at Jackson Hole) to now, the 2-year yield is down 25 basis points, the 10-year is down 28 basis points, while the 10y10y forward is down only 22 basis points and the 10y20y forward is down only 16 basis points. This tells you that upward pressure on longer-term yields is still very much there, which US recession fears are only mitigating somewhat.

Takeaways by Macro Roundup® AI

  1. From August 21, the day before Chair Powell's dovish Jackson Hole speech, the US 2-year yield fell 25 basis points and the 10-year fell 28, while the 10y10y forward fell 22 basis points and the 10y20y forward 16.
  2. The 10y10y and 10y20y forward yields, constructed from 10-, 20- and 30-year yields to price the 10-year yield 10 and 20 years ahead, are falling far less than the 2- and 10-year yields.
  3. The smaller declines in far-forward yields indicate that upward pressure on longer-term US yields persists, with US recession fears only mitigating it somewhat.

Related Articles:

  • Global Debt Report 2025 — About 60% of fixed-rate government debt in advanced economies maturing by 2027 — roughly $9tn — was issued before the recent interest-rate tightening, with weighted average yields below 2% versus projected 10-year rates near 3.6%, implying refinancing at nearly double the original cost. France, Spain, the UK, and the US face heightened vulnerability, with maturing debt exceeding 15% of GDP.
  • Global Bond Rout — The Netherlands' $2tn pension system, the European Union's largest, is shifting from defined-benefit to defined-contribution plans, reducing its need to hold long-dated government bonds as a hedge against promised future payouts. The expected drop in demand for long-duration bonds is putting upward pressure on yields.
  • Why Are Long-Term Yields Rising? — Japan and Germany both have 30-year government bond yields near 3.3% despite gross government debt of 240% of GDP versus just above 60%, a gap attributed to the Bank of Japan's large-scale bond purchases. As the Bank of Japan steps back from capping long-term yields, Japan's 30-year yield is likely to rise further.

AI Summary. Gold's spot price reached an all-time high of $3,674.27 an ounce, surpassing the inflation-adjusted peak set when gold topped out at $850 in January 1980. That earlier peak came amid a collapsing US currency, an inflation spike, and a recession.

Yvonne Yue Li, Yihui Xie, Jack Ryan, and Sybilla Gross Bloomberg
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Gold has surpassed its real peak in 1980, hitting an all-time, inflation-adjusted high of $3,674.27 per Troy ounce. When gold hit $850 nominal in January 1980 (~ $3,590 in 2025 dollars), the US was grappling with a collapsing currency and stagflation.

Has gold surpassed its inflation-adjusted record high?

Core argument: Spot gold hit an all-time high of $3,674.27 an ounce after rising about 5% so far this month, exceeding the inflation-adjusted peak set on Jan. 21, 1980, when prices topped out at $850.

The spot price of gold has surged about 5% so far this month, with prices hitting an all-time high of $3,674.27 an ounce. It’s set more than 30 nominal records already in 2025, but the latest leg of the rally has also taken it through an inflation-adjusted peak set on Jan. 21, 1980, when prices topped out at $850. When gold hit $850 in January 1980, the US was grappling with a collapsing currency, a spike in inflation and an unfolding recession. The price had doubled over the previous two months, after US President Jimmy Carter issued a freeze on Iranian assets in response to a hostage crisis in Tehran, raising the perceived risk of holding dollar assets for some foreign central banks.

Takeaways by Macro Roundup® AI

  1. Spot gold hit an all-time high of $3,674.27 an ounce after rising about 5% so far this month, exceeding the inflation-adjusted peak set on Jan. 21, 1980, when prices topped out at $850.
  2. Gold has set more than 30 nominal record highs in 2025, with the latest leg of the rally carrying it past the 1980 inflation-adjusted record.
  3. When gold reached $850 in January 1980, the US faced a collapsing currency, an inflation spike and an unfolding recession, and the price had doubled over the prior two months after President Jimmy Carter froze Iranian assets.

Related Articles:

  • De-Dollarization? Diversification? Exploring Central Bank Gold Purchases and the Dollar’s Role in International Reserves — Central banks' gold accumulation is generally not associated with reducing the dollar's share of international reserves at the country level, apart from a few prominent cases, and is more consistent with modest overall diversification. Gold's role as an official-sector store of value has grown, but its use as a unit of account and medium of exchange remains limited.
  • Taking Stock: Dollar Assets, Gold, and Official Foreign Exchange Reserves — Gold accounts for about 10% of aggregate official foreign exchange reserves, roughly its level in the early 2000s. International Monetary Fund country data indicate most added official gold holdings came from a few central banks, with over half of reported accumulation from China and Russia and about a quarter from several emerging markets.
  • All That Glitters Is Cognitive Dissonance — Gold has risen more than 37% over the year, its strongest annual showing in more than three decades and a plausible path toward $4,000 an ounce, even as the Nasdaq Composite Index sets records. Central bank accumulation has been crucial, with gold purchases topping 1,000 tons for a third consecutive year.

AI Summary. Using high-frequency administrative data, the authors find most U.S. workers experience substantial month-to-month pay fluctuations even within ongoing jobs, with lower-income hourly workers facing more instability than higher-income salaried workers, largely because of firm-driven swings in hours. The authors present causal evidence that this instability raises consumption volatility and job separations.

Peter Ganong, Pascal Noel, Christina Patterson, Joseph Vavra, et al. National Bureau Of Economic Research
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High frequency data show that many US workers – especially lower-income, hourly workers – face month-to-month, hours-induced, and within-firm pay fluctuations. Contrary to the Permanent Income Hypothesis, this affects consumption stability and utility.

How does month-to-month pay instability affect workers' consumption and job separations?

Core argument: High-frequency administrative data show that the majority of U.S. workers face substantial month-to-month pay fluctuations even within ongoing employment relationships, instability that analyses of annual data have masked.

This paper uses high frequency administrative data to show that the majority of U.S. workers experience substantial month-to-month fluctuations in pay, even within ongoing employment relationships. This earnings instability is pervasive, but it has been masked in past analysis of annual data. Moreover, this instability is unequally distributed: lower-income, hourly workers face more instability than higher-income, salaried workers because earnings instability arises in large part from firm-driven fluctuations in hours. This earnings instability is a meaningful source of economic risk: we provide causal evidence that it increases consumption volatility and also leads to greater job separations, and we find that workers have a high willingness to pay to reduce earnings instability. These findings suggest that [in contradiction to the time-honored permanent income hypothesis (PIH)], short-term earnings risk is a significant and previously underappreciated feature of the labor market

Takeaways by Macro Roundup® AI

  1. High-frequency administrative data show that the majority of U.S. workers face substantial month-to-month pay fluctuations even within ongoing employment relationships, instability that analyses of annual data have masked.
  2. Earnings instability falls disproportionately on lower-income, hourly workers relative to higher-income, salaried workers, arising in large part from firm-driven fluctuations in hours.
  3. Causal evidence indicates that earnings instability raises consumption volatility and job separations, and workers show a high willingness to pay to reduce it, suggesting short-term earnings risk is an underappreciated labor market feature.

Related Articles:

  • Unions, Wages and Hours — After adjusting for worker characteristics, the gap between union and non-union members' hourly earnings has been declining since the Great Recession, while the union differential in weekly wages has been more stable at roughly 15 log points. That weekly gap reflects both a higher hourly wage (about 10 log points) and longer working hours (about 5 log points).
  • Poverty, Hardship and Government Transfers — Income-based poverty measures show a large decline followed by a large increase, while consumption-based poverty declines steadily; the authors attribute the gap to low-income households saving, then dissaving and borrowing. They estimate that expanded child tax credits, stimulus payments, and pandemic unemployment benefits each played similar or larger roles in reducing poverty.