Edward Conard

Top Ten New York Times Bestselling Author

  • “Unintended Consequences is full of substance, it is one of the must-read books of the year, and once I finish it I will be giving it a second read through right away.” - Tyler Cowen, Professor, George Mason University
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “…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
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “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
  • “Unintended Consequences represents the most cogent and persuasive analysis of the Financial Crisis to date.” - Andrei Shleifer, 1999 John Bates Clark Medal Winner
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “A full-throated defense of economic dynamism.” - The Wall Street Journal
  • “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
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Thursday, March 26, 2026

AI Summary. The authors argue Japan's prolonged recession reflected the interplay of slowing returns to investment, weak consumption, and negative sentiment, and that China is in the middle stages of a multi-year real estate correction under more difficult macroeconomic and demographic conditions. They note China retains advantages, including a state-dominated financial system with implicit government guarantees capable of large-scale intervention.

Kenneth Rogoff and Yuanchen Yang Brookings Papers On Economic Activity
Date Posted:
Is Database:
Database

The deep recession after Japan’s 1990–1991 real estate crash saw low returns on investment, soft consumption and weak sentiment. After its property bust, China shows many parallels, but strong productivity and state-backed finance are potential cushions.

Is China's property correction following Japan's post-bubble path?

Core argument: China appears to be in the middle stages of a multi-year real estate correction, with structural and cyclical features resembling Japan's pre- and post-bubble conditions, though China's adjustment is unfolding in a more difficult macroeconomic and demographic context.

Japan’s prolonged recession was likely driven by the interplay of slowing returns to investment, soft consumption, and negative sentiment that reinforced these weaknesses. With some structural and cyclical characteristics closely resembling Japan’s pre- and post-bubble conditions, China appears to be in the middle stages of a multi-year correction. China’s post-boom adjustment is unfolding in a more difficult macroeconomic and demographic context than Japan’s. That said, China still possesses several economic and institutional advantages that could help cushion the blow of a prolonged real estate downturn. In Japan’s post-bubble era, the country’s productivity growth was considered a binding constraint, a factor that does not appear to limit China in the same way. Most crucially, China possesses a state-dominated financial system backed by implicit government guarantees and a highly proactive policymaking apparatus capable of large-scale interventions, which have thus far prevented the crisis from precipitating a financial sector breakdown.

Takeaways by Macro Roundup® AI

  1. China appears to be in the middle stages of a multi-year real estate correction, with structural and cyclical features resembling Japan's pre- and post-bubble conditions, though China's adjustment is unfolding in a more difficult macroeconomic and demographic context.
  2. China's state-dominated financial system, backed by implicit government guarantees and a proactive policymaking apparatus capable of large-scale interventions, has thus far prevented its real estate crisis from precipitating a financial sector breakdown.
  3. Japan's prolonged recession was likely driven by the interplay of slowing returns to investment, soft consumption, and negative sentiment, with productivity growth considered a binding constraint that does not appear to limit China in the same way.

Related Articles:

  • Peak China Housing — Real estate and related industries account for roughly 29% of China's GDP, a level of dependence the authors estimate exceeds that of Ireland and Spain before their financial crises. A 20% decline in housing activity could reduce economic output by 5-10%.
  • China Debt Overhang Leads To Rising Share Of ‘Zombie’ Firms — Firm-level data indicate the share of Chinese non-financial firms' assets held by "zombie" companies — those whose operating earnings fall short of their interest expenses — rose from 5% to 16% between 2018 and 2024, with real estate highest at 40%, services at 17% and manufacturing at 11%.
  • China’s Economy: Rightsizing 2025, Looking Ahead to 2026 — The authors argue China's official growth figures are inconsistent with ten consecutive quarters of deflation, estimating that real GDP is around 11% below official levels, with most of the adjustment in investment. That would imply a drop of roughly 9 percentage points in China's share of global investment, helping explain its export surge.

AI Summary. Inflation across the G20 is projected to run 1.2 percentage points higher than previously expected at 4% before easing to 2.7% the following year, while core inflation in G20 advanced economies is anticipated to weaken from 2.6% to 2.3%. These projections assume energy market disruption moderates, with oil, gas and fertiliser prices declining gradually.

OECD Staff Organisation for Economic Co-operation and Development
Date Posted:

The OECD projects US headline inflation of 4.2% this year, up 1.2pp from their December projection and 1.6pp above 2025’s 2.6%, due to the energy shock from the Iran War. Their core inflation projection is unchanged at 3%, up from 2.8% last year.

Will global inflation ease as energy price pressures fade?

Core argument: G20 inflation is projected at 4% in 2026, 1.2 percentage points higher than previously expected, before easing to 2.7% in 2027 as energy price pressures are assumed to fade.

G20 inflation is projected to be 1.2 percentage points higher than previously expected in 2026 at 4%, before easing to 2.7% in 2027 with an assumed fading of energy price pressures. Core inflation in the G20 advanced economies is anticipated to weaken from 2.6% in 2026 to 2.3% in 2027. These projections are conditional on a technical assumption that the current extent of energy market disruption moderates over time, with oil, gas and fertiliser prices declining gradually from mid-2026 onwards.

Takeaways by Macro Roundup® AI

  1. G20 inflation is projected at 4% in 2026, 1.2 percentage points higher than previously expected, before easing to 2.7% in 2027 as energy price pressures are assumed to fade.
  2. Core inflation in the G20 advanced economies is anticipated to weaken from 2.6% in 2026 to 2.3% in 2027.
  3. The inflation projections are conditional on a technical assumption that energy market disruption moderates, with oil, gas and fertiliser prices declining gradually from mid-2026 onwards.

Related Articles:

  • High Prices and Upside Risks for Longer — Oil flows through the Strait of Hormuz are projected to stay at just 5% of normal levels for six weeks before a gradual one-month recovery. The authors expect the resulting supply shock to prompt policymakers to rebuild strategic reserves and markets to price a security premium into long-dated oil.
  • You Can’t Print Molecules — Rebuilding after a disruption to a key shipping strait would require governments to finance defense, strategic reserves, domestic energy production, and infrastructure at the same time that inflation expectations are raising funding costs. The author argues capital will rotate out of asset-light sectors that thrived on open sea lanes and cheap energy into asset-heavy physical ones.
  • Pandora’s Bog: The Global Energy Shock of 2026 — Gulf liquefied natural gas is only 3% of global gas consumption, but because commodity prices are set at the margin, its loss pushes gas import prices higher in Europe and Asia as China, Korea, India and Pakistan seek replacement supplies on the spot market. Undamaged Qatari facilities would need 3-4 months to reach full loading.

AI Summary. Disruption to fertilizer supplies could raise grain prices mainly by cutting grain output, through yield losses from delayed or sub-optimal nitrogen application and shifts toward less fertilizer-intensive crops; fertilizer accounts for about 20% of grain costs. Regions with later crop calendars, such as Europe and the Southern Hemisphere, are more exposed than the US.

Lina Thomas and Daan Struyven Goldman Sachs
Date Posted:

More than 25% of the global nitrogen fertilizer trade, which accounts for 60% of global fertilizer use, passed through the Strait of Hormuz. GS projects grain supply will decline as farmers shift to less fertilizer-intensive crops like soybeans.

How do fertilizer supply disruptions raise global grain prices?

Core argument: Fertilizer accounts for roughly 20% of grain costs, so higher fertilizer prices may feed into grain prices, though the larger potential boost to grain prices is more likely to come from reduced grain supply.

While higher fertilizer prices may eventually feed into grain prices -- given fertilizer accounts for ~20% of grain costs -- the largest potential boost to grain prices is more likely to come from reduced grain supply. Fertilizer disruptions may reduce grain production both through yield losses from delayed/sub-optimal nitrogen application, and potential acreage shifts toward less fertilizer-intensive crops. While the US is currently relatively insulated--because the conflict began just ahead of the planting season, by which point most farmers likely already secured fertilizers--more exposed regions such as Europe, Australia and the Southern Hemisphere, where crop calendars are later, could increase demand for US grain exports if fertilizer disruptions persist, raising US grain prices too.

Takeaways by Macro Roundup® AI

  1. Fertilizer accounts for roughly 20% of grain costs, so higher fertilizer prices may feed into grain prices, though the larger potential boost to grain prices is more likely to come from reduced grain supply.
  2. Fertilizer disruptions may reduce grain production through yield losses from delayed or sub-optimal nitrogen application and through potential acreage shifts toward less fertilizer-intensive crops.
  3. The US is relatively insulated because the conflict began just ahead of planting season, by which point most farmers had likely already secured fertilizer, while Europe, Australia and the Southern Hemisphere have later crop calendars and greater exposure.

Related Articles:

  • Why is Xi Jinping Building Secret Commodity Stockpiles? — China's commodity imports rose 16% in volume terms with record imports of many basic resources, while state statisticians have stopped publishing stock data for many commodities. The US Department of Agriculture projects China will hold 51% of world wheat stocks and 67% of maize stocks, and the country's crude-oil storage capacity has grown from 1.7bn to 2bn barrels.
  • China Expands Farmland In Bid To Cut Foreign Food Reliance — China has set a target of maintaining 120mn hectares of cultivated land, a level Beijing views as necessary for food self-sufficiency, and has reclaimed more than 170,000 hectares of farmland in a drive to cut reliance on imported food. Analysts say the effort reflects preparation for a scenario in which confrontation with the US disrupts global food supply chains.

AI Summary. Census population estimates show urban counties growing more slowly than suburbs, smaller metropolitan areas, and rural areas, with all county types slowing as immigration fell and the slowdown especially sharp in urban counties. Domestic migration is driven more by affordability, with people leaving expensive urban counties for cheaper suburbs and smaller communities.

Jed Kolko Jed Kolko Substack
Date Posted:
Is Database:
Database

As immigration slowed in 2025, large urban counties’ growth continued to slow relative to that of suburban, rural and smaller urban counties. Domestic migration continued to consist of moves from expensive counties to more affordable suburban areas.

Does lower immigration slow urban county growth more than elsewhere?

Core argument: Urban counties grew more slowly in 2025 than suburban counties, smaller metropolitan areas, and rural areas, according to vintage 2025 Census population estimates.

Urban counties grew more slowly than suburban counties, smaller metropolitan areas, and rural areas in 2025. All types of counties grew more slowly in 2025 than in 2023 and 2024 because immigration fell. However, the slowdown was especially sharp for urban counties. The only other years this century when urban counties lagged all other types of places were in 2020-2022, when people moved out of cities during the pandemic, and in 2003-2006, when the housing bubble boosted housing construction in outlying suburban areas and drew new residents from cities. (This is based on vintage 2025 Census population estimates, released this morning.) Domestic migration is driven more by affordability, with people leaving expensive urban counties for more affordable suburban areas and smaller communities.

Takeaways by Macro Roundup® AI

  1. Urban counties grew more slowly in 2025 than suburban counties, smaller metropolitan areas, and rural areas, according to vintage 2025 Census population estimates.
  2. All county types grew more slowly in 2025 than in 2023 and 2024 because immigration fell, with the slowdown especially sharp for urban counties.
  3. The only other years this century when urban counties lagged all other place types were 2020–2022, amid pandemic moves out of cities, and 2003–2006, when housing-bubble construction in outlying suburbs drew residents from cities.

Related Articles:

  • Where Americans Choose to Move and Where They Leave — County-level mapping of net domestic migration within the United States shows some counties gained net movers equal to 10% or more of their 2020 population while others lost an equivalent share, excluding international moves.
  • The Demographic Outlook: 2026 to 2056 — The Congressional Budget Office projects the US population rises from 349m to 364m between 2026 and 2056, with annual growth slowing from 0.3% over the next decade to 0.1% thereafter before reaching zero and then shrinking. Declining fertility is projected to push deaths above births starting in 2030, increasingly offsetting net immigration.
  • New Population Estimates Show Historic Decline in Net International Migration — The U.S. Census Bureau estimates net international migration peaked at 2.7m in 2024 and fell to 1.3m in 2025, with a projected decline to roughly 321,000 in 2026 if current trends continue. The Bureau notes that continued trends would produce the first net negative migration in more than 50 years.

AI Summary. The average monthly new-car payment reached $774, up from $588 four years earlier, and more than 20% of new-car borrowers agreed to pay over $1,000 a month, a record, according to auto research firm Edmunds. Including insurance, gas, repairs and maintenance, total vehicle ownership costs have risen more than 40%.

Kailyn Rhone New York Times
Date Posted:

The mean payment on a new car was $774 in January, up from $588 in January 2021 – an ~32% increase, outpacing the overall 24% increase in the price level. Americans with household incomes above $150,000 make up 43% of new car sales.

How much have car payments and ownership costs risen?

Core argument: The average monthly new-car payment reached $774 in January, up from $588 in January 2021, according to Edmunds, with more than 20% of new-car borrowers agreeing to pay over $1,000 a month at the end of last year, a record.

The average monthly new-car payment reached $774 in January, up from $588 in January 2021, according to Edmunds, an auto research firm. A growing share of buyers are taking on even larger loans: More than 20% of new-car borrowers agreed to pay over $1,000 a month at the end of last year, which was a record, Edmunds reported. But loan payments are only part of the strain. When insurance, gas, repairs and maintenance are included, the total cost of owning a vehicle has risen more than 40% since January 2020, according to an index from Navy Federal Credit Union. Part of the reason insurance costs are [rising is] steady growth in uninsured drivers. The number of people driving without coverage jumped to more than 15% in 2023 from about 11% in 2019, according to Insurance Research Council, a firm that calculates data based on the relative frequencies of auto-insurance claims. JD Power, which surveys consumers about insurance trends, reported a similar increase in uninsured drivers in the second half of 2025.

Takeaways by Macro Roundup® AI

  1. The average monthly new-car payment reached $774 in January, up from $588 in January 2021, according to Edmunds, with more than 20% of new-car borrowers agreeing to pay over $1,000 a month at the end of last year, a record.
  2. The total cost of vehicle ownership, including insurance, gas, repairs and maintenance, has risen more than 40% since January 2020, according to an index from Navy Federal Credit Union.
  3. The share of uninsured drivers rose to more than 15% in 2023 from about 11% in 2019, according to the Insurance Research Council, and JD Power reported a similar increase in the second half of 2025.

Related Articles:

Friday, March 27, 2026

AI Summary. The U.S. average gasoline price rose by nearly $1 a gallon, from about $2.90 to $3.70, according to the Energy Information Administration — the second-largest four-week increase in at least 30 years, exceeded only by the jump after Hurricane Katrina. With the typical U.S. driver covering about 1,000 miles a month, that adds up to $50 monthly.

Francesca Paris New York Times
Date Posted:

American gas prices have increased by ~27% nationally since the start of the Iran War. However, in real terms they are still well under their 2022 and summer 2008 levels.

How much does a near-dollar gas price jump cost drivers monthly?

Core argument: U.S. average gas prices rose from about $2.90 per gallon in mid-February to $3.70 by mid-March, according to the Energy Information Administration, a gain of nearly a dollar since the start of the war in Iran.

Since the start of the war in Iran, the average price of gas in the United States has climbed by nearly a dollar. In mid-February, gas cost around $2.90 per gallon. By mid-March, it was up to $3.70, according to the Energy Information Administration. It’s the second-largest four-week increase in at least 30 years — bigger than the one at the start of the war in Ukraine in 2022, or the ones associated with the post-recession surge of 2009 and the OPEC production cuts in 1999. The only bigger jump came after Hurricane Katrina in 2005, when gas supply fell significantly. The typical U.S. driver travels around 1,000 miles each month. Depending on the car, those higher prices translate to as much as $50 more a month.

Takeaways by Macro Roundup® AI

  1. U.S. average gas prices rose from about $2.90 per gallon in mid-February to $3.70 by mid-March, according to the Energy Information Administration, a gain of nearly a dollar since the start of the war in Iran.
  2. The four-week increase in U.S. gas prices is the second-largest in at least 30 years, exceeding those at the start of the Ukraine war in 2022, the post-recession surge of 2009, and the 1999 OPEC production cuts.
  3. Only the jump after Hurricane Katrina in 2005, when gas supply fell significantly, was larger, and for the typical U.S. driver covering about 1,000 miles a month the higher prices mean as much as $50 more monthly.

Related Articles:

  • Bad News Bias in Gasoline Price Coverage — An analysis of over one million television transcripts finds that coverage of gasoline prices shows a negative news bias, ramping up sharply once the nominal price reaches $3.50 a gallon, most steeply at Fox News. Because that threshold is fixed in nominal terms, the inflation-adjusted trigger has fallen by one-third.
  • Fighting Words: The Energy Transition in 2026 — Estimates based on primary energy overstate how much electricity is needed to replace oil in passenger cars, since electric motors convert 80%-90% of electricity into motion versus about 18% for gasoline cars. Measuring useful final energy net of waste heat avoids this "primary energy fallacy": the US consumed 45 exajoules of useful final energy versus 95 exajoules of primary energy.
  • Testing Resilience — Inflation across the G20 is projected to run 1.2 percentage points higher than previously expected at 4% before easing to 2.7% the following year, while core inflation in G20 advanced economies is anticipated to weaken from 2.6% to 2.3%. These projections assume energy market disruption moderates, with oil, gas and fertiliser prices declining gradually.

AI Summary. The author argues that energy, rather than fixed income, now serves as the true hedge to equity positions, pushing investors, companies and countries to review their energy allocations and policies. Chinese government bonds diversified equity risk when no other major bond market did, which the author attributes to China being the only major economy without a meaningful inflation problem.

Louis-Vincent Gave Gavekal
Date Posted:

Prior to the war, investors had largely stopped hedging energy-driven inflation. Gave argues that now “the true hedge to equity positions is no longer fixed income, but energy,” and notes China is “weathering the storm better than others.”

Has energy replaced fixed income as the true hedge to equities?

Core argument: The author argues the balanced portfolio is dead and that energy, not fixed income, has replaced fixed income as the true hedge to equity positions, a claim that holds truer the more policy worldwide remains unpredictable.

The past two weeks have once again illustrated that the balanced portfolio is dead and that the true hedge to equity positions is no longer fixed income, but energy. The more policy around the world remains unpredictable, the truer it will be. The closure of the Hormuz Strait is now forcing investors, companies and entire countries to accept this simple truth and review their energy allocations and policies. Once again, in this crisis, Chinese government bonds did their job diversifying equity risk when no other major bond market did so. This makes sense since China is the only major economy with no meaningful inflation problem. China is also one of the few major economies to have followed a rational, and consistent, energy policy over the past decade. [Since the start of the Iran War] Chinese government bonds did their job diversifying equity risk when no other major bond market did so. This makes sense since China is the only major economy with no meaningful inflation problem.

Takeaways by Macro Roundup® AI

  1. The author argues the balanced portfolio is dead and that energy, not fixed income, has replaced fixed income as the true hedge to equity positions, a claim that holds truer the more policy worldwide remains unpredictable.
  2. Chinese government bonds diversified equity risk since the start of the Iran War when no other major bond market did, which the author attributes to China being the only major economy without a meaningful inflation problem.
  3. The closure of the Hormuz Strait is forcing investors, companies and countries to review their energy allocations and policies, with China cited as one of the few major economies to have followed a rational, consistent energy policy over the past decade.

Related Articles:

  • High Prices and Upside Risks for Longer — Oil flows through the Strait of Hormuz are projected to stay at just 5% of normal levels for six weeks before a gradual one-month recovery. The authors expect the resulting supply shock to prompt policymakers to rebuild strategic reserves and markets to price a security premium into long-dated oil.
  • You Can’t Print Molecules — Rebuilding after a disruption to a key shipping strait would require governments to finance defense, strategic reserves, domestic energy production, and infrastructure at the same time that inflation expectations are raising funding costs. The author argues capital will rotate out of asset-light sectors that thrived on open sea lanes and cheap energy into asset-heavy physical ones.
  • Fighting Words: The Energy Transition in 2026 — Estimates based on primary energy overstate how much electricity is needed to replace oil in passenger cars, since electric motors convert 80%-90% of electricity into motion versus about 18% for gasoline cars. Measuring useful final energy net of waste heat avoids this "primary energy fallacy": the US consumed 45 exajoules of useful final energy versus 95 exajoules of primary energy.

AI Summary. Liquidity in the US Treasury market has deteriorated, with the size of trades needed to move prices down roughly 40-50% in cash bonds and as much as 80% in shorter-dated bond futures, according to market participants. Recent auctions of two- and five-year government debt were weak, leaving dealers to absorb unusually large shares.

Kate Duguid and Ian Smith Financial Times
Date Posted:

There has been a deterioration in Treasury market liquidity since the start of the Iran War, as market depth fell ~ as much as it did around Liberation Day. Treasury auctions saw tepid private demand this week; modest trades were able to impact prices.

Is liquidity in the Treasury market deteriorating?

Core argument: Treasury cash-market depth has fallen roughly 40–50% versus prewar levels, according to AllianceBernstein, while JPMorgan Chase notes the drop nearly matches the decline that followed Trump's "liberation day" announcement.

JPMorgan Chase noted this week that the size of trades required to move prices, known as “market depth,” has fallen by nearly as much as it did following Trump’s liberation day announcement. With that volatility driving traders to the sidelines, market depth has declined by roughly 40-50% in the cash market compared to prewar levels, according to AllianceBernstein. In shorted-dated bond futures, derivatives that are widely used to bet on or hedge against moves in bonds, market depth has declined by as much as 80% this week compared to this year’s average, according to an executive at a large asset manager. US government auctions of new shorter-dated bonds have also gone poorly this week. At Tuesday’s sale of $69bn worth of two-year bonds, dealers — the big banks that are forced to mop up any bonds not purchased by investors — took the largest percentage of the offering since 2022. The same pattern was seen at Wednesday’s auction of $70bn of five-year notes, where dealers purchased the most since 2024. An auction of seven-year notes on Thursday was moderately better, but still weak by historical standards.

Takeaways by Macro Roundup® AI

  1. Treasury cash-market depth has fallen roughly 40–50% versus prewar levels, according to AllianceBernstein, while JPMorgan Chase notes the drop nearly matches the decline that followed Trump's "liberation day" announcement.
  2. Depth in short-dated bond futures, derivatives used to bet on or hedge bond moves, has fallen by as much as 80% against this year's average, according to an executive at a large asset manager.
  3. Dealers took the largest share of a two-year Treasury auction since 2022 at a $69bn sale and the most since 2024 at a $70bn five-year sale, while a seven-year auction was moderately better but weak by historical standards.

Related Articles:

  • War Cost Sinks Long-Term Government Bonds on Deficit Worries — Investor concern that the Iran war will raise government spending and widen budget deficits has triggered a selloff in long-term government bonds, pushing the 30-year US Treasury yield near 4.90% and lifting yields from the UK and Germany to Australia and Japan. A global borrowing wave could further pressure the $31tn US Treasury market.
  • Are Government Bonds Safe in Times of War and Pandemic? — Government bonds severely underperform in wartime, in absolute terms and relative to equities, housing, and economic growth, unlike in financial crises when bonds tend to outperform stocks. The U.S. and U.K. reduced war-driven debt-to-GDP ratios without explicit default, using surprise inflation and financial repression that shifted fiscal burdens onto bondholders.
  • $14 Trillion in IG Supply Coming to the Market — About $14tn of investment-grade fixed income supply is coming to market, combining roughly $10tn of US government debt to be refinanced over the next 12 months, a budget deficit near $2tn, and about $2tn of gross corporate bond issuance boosted by data-center builders. The author argues this growing supply is putting upward pressure on interest rates and credit spreads.

AI Summary. The authors estimate that state legalization of sports betting raises average quarterly betting spending per person by about $46 from a pre-legalization mean of $2.50, with spillover spending in nearby counties where betting is illegal. Three years later, median credit scores are one point lower and delinquency rates 0.31 percentage points higher.

Jacob Goss and Daniel Mangrum Federal Reserve Bank of New York
Date Posted:
Is Database:
Database

After the legalization of sports betting in 2018, delinquency rates on a wide range of consumer debts rose, increasing .31pp as of 2025. The delinquency rate for the ~3% of the population that were new gamblers increased by ~10pp driven by those under 40.

How does legalizing sports betting affect spending and consumer credit?

Core argument: State legalization of sports betting raises average quarterly betting spending per person by roughly $46 from a pre-treatment mean of $2.50 and lifts the share of the population with any sportsbook spending by 3.1 percentage points.

Exploiting the staggered roll-out of state-level legalization following the 2018 Murphy v. NCAA decision, we use an extended two-way fixed effects (ETWFE) framework that separately estimates direct treatment effects and cross-border spillover effects. Our first-stage estimates establish that legalization dramatically increases betting activity: average quarterly spending per person rises by roughly $46 from a pre-treatment mean of $2.50, and the share of the population with any sportsbook spending in a quarter increases by 3.1 percentage points. The effects on average spending grow continually over time with no clear evidence of saturation, suggesting the market for mobile sports betting continues to mature years after legalization. At the same time, substantial betting activity occurs in counties where sports betting is not legal but which lie near a legal state, with spillover effects on total spending roughly 14% of the direct effect for counties within 15 miles of a legal state, declining monotonically with distance and approaching zero by 60 miles. These spillovers have real consequences for consumer financial health. Three years after legalization, median credit scores are one point lower and overall delinquency rates increase by 0.31 percentage points following legalization. [Under-40 auto loan delinquency increases by half a percentage point and credit card delinquency by one percentage point, driving the overall increase in delinquency.] Since only about 3.1% of the population takes up betting after legalization, these intent-to-treat estimates would imply that those who are induced to bet due to legalization experience delinquency increases of 10 percentage points.

Takeaways by Macro Roundup® AI

  1. State legalization of sports betting raises average quarterly betting spending per person by roughly $46 from a pre-treatment mean of $2.50 and lifts the share of the population with any sportsbook spending by 3.1 percentage points.
  2. Three years after legalization, median credit scores are one point lower and overall delinquency rates rise by 0.31 percentage points, with under-40 auto loan delinquency up half a percentage point and credit card delinquency up one percentage point.
  3. For counties within 15 miles of a legal state, spillover effects on total spending are roughly 14% of the direct effect, declining monotonically with distance and approaching zero by 60 miles.

Related Articles:

  • The Case for Prohibiting Vice — A record 62m Americans used marijuana in a single year, 17m of them daily or near daily, while half of American men now hold sports-betting accounts, up from almost zero seven years earlier. The author argues vice and addiction undermine citizens' capacity for free action, justifying state regulation beyond individual-harm criteria.
  • Americans Increasingly See Legal Sports Betting As A Bad Thing For Society and Sports — Survey data show 43% of U.S. adults say legalized sports betting is a bad thing for society, up from 34% three years earlier, and 40% say it is bad for sports, up from 33%. The largest shift came among men under 30, 47% of whom now call it bad for society versus 22% earlier.
  • From Sports to AI, America Is Awash in Speculative Fever. Washington Is Egging It On — Speculation now extends beyond stocks, bonds and property to crypto, valued at roughly $4tn, and sports betting, where Americans wagered $150bn in a year, up 24%, according to the American Gaming Association. Gold, traditionally a hedge against bubbles, itself looks bubbly, and working-class investors are flocking to these markets.

AI Summary. Online pornography is shifting from algorithmically curated tube sites, which still draw billions of monthly views, toward webcam and subscription platforms where creators with millions of social-media followers earn tens of millions of dollars from explicit livestreams. AI platforms now generate explicit videos, including realistic clips made from a single imported photograph.

David Sasaki American Institute for Boys and Men
Date Posted:

According to a 2022 survey, 54% of Americans had their first exposure to online pornography by the time they were 13. Americans now spend more on OnlyFans than on OpenAI and the New York Times combined.

How is online pornography shifting toward livestreams and AI-generated content?

Core argument: Pornography tube sites such as Pornhub and XVideos still draw billions of monthly views from algorithmically curated videos, but the landscape is shifting toward webcam and subscription platforms like Chaturbate and OnlyFans.

Five years ago, concerns about pornography centered on tube sites — Pornhub, XVideos, and their equivalents — where algorithmically curated videos to this day draw billions of monthly views. That landscape is rapidly changing. While scrolling through social feeds, young men are one tempting click away from an 18-year-old dancing naked in her bedroom on Chaturbate, OnlyFans, and dozens of other webcam sites. OnlyFans creators Sophie Rain and Anna Paul have millions of followers on TikTok, Instagram, and Snapchat — mostly young men, who collectively pay tens of millions of dollars to access their sexually explicit livestreams. AI has transformed pornography further still. Platforms like PornTubeAI are filled with a wide range of AI-generated videos, from deepfaked depictions of the “girl next door” to sexually explicit portrayals of recent news events. AI-powered nudification apps generate startlingly realistic, explicit video clips based on a single photograph. One of the most popular versions allows users to import photos directly from Instagram.

Takeaways by Macro Roundup® AI

  1. Pornography tube sites such as Pornhub and XVideos still draw billions of monthly views from algorithmically curated videos, but the landscape is shifting toward webcam and subscription platforms like Chaturbate and OnlyFans.
  2. OnlyFans creators Sophie Rain and Anna Paul have millions of TikTok, Instagram, and Snapchat followers, mostly young men, who collectively pay tens of millions of dollars for access to sexually explicit livestreams.
  3. AI platforms such as PornTubeAI host videos ranging from deepfaked "girl next door" depictions to explicit portrayals of recent news events, while nudification apps generate realistic explicit clips from a single photograph, with one popular version importing photos directly from Instagram.

Related Articles:

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