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, April 15, 2026

AI Summary. Data indicate persistence in returns on invested capital has increased since 2000, with large companies the main beneficiaries; the information technology sector's aggregate return was 19% versus a 10.8% median from 1970 to 2024. Of about 13,800 U.S. public firms listing from 1976 to 2019, 18% survived.

Michael Mauboussin and Dan Callahan Morgan Stanley
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The Competitive Advantage Period (CAP), the period in which the market implies a firm can earn a return greater than its cost of capital, for most firms is 5–20 years, as ROIC regresses to the mean. Persistence of ROIC has increased, driven by a small number of large firms since 2000.

Have high returns on invested capital become more persistent for large companies?

Core argument: The aggregate return on invested capital for the information technology sector was 19% from 1970 to 2024 versus a median of 10.8%, and has on average exceeded the 75th-percentile company's ROIC since the Great Recession, meaning a small number of large companies determine the sector aggregate.

The data suggest that persistence in ROIC is up since 2000 and that large companies are the main beneficiaries of the implied expansion in CAPs. To illustrate the point, the aggregate ROIC for the information technology sector was 19% versus the median of 10.8% from 1970 to 2024. As striking, the aggregate ROIC for the sector has been greater on average than the ROIC for the 75th-percentile company (i.e., the ROIC below which 75% of data fall), since the Great Recession. This means a small number of large companies are determining the aggregate figure for the sector. From 1926 to 2025, the average listing time for a public company in Bessembinder’s database was 11.7 years, and the median listing time was 6.8 years. About 9% of listed companies at the beginning of 2026 were more than 50 years old. Modeling perpetual growth without considering mortality can create a mismatch. Exhibit 7 shows what happened to about 13,800 U.S. public firms that started trading between 1976 and 2019, excluding financial firms. For every 100 companies, 18 survived and 82 died. Of those that died, 43 were the result of mergers and acquisitions. The other 39 were delisted for reasons other than M&A, with the majority of those for “cause.” This happens when a company files for bankruptcy or fails to meet certain requirements set by an exchange.

Takeaways by Macro Roundup® AI

  1. The aggregate return on invested capital for the information technology sector was 19% from 1970 to 2024 versus a median of 10.8%, and has on average exceeded the 75th-percentile company's ROIC since the Great Recession, meaning a small number of large companies determine the sector aggregate.
  2. Of roughly 13,800 non-financial U.S. public firms that began trading between 1976 and 2019, 18 of every 100 survived and 82 died, 43 through mergers and acquisitions and 39 delisted for other reasons, the majority for cause such as bankruptcy.
  3. The average listing time for a public company in Bessembinder's database was 11.7 years from 1926 to 2025, with a median of 6.8 years, and about 9% of companies listed at the start of 2026 were more than 50 years old.

Related Articles:

  • One Hundred Years in the U.S. Stock Markets — Over a century, U.S. publicly traded stocks generated roughly $91tn in shareholder wealth enhancement, with returns strongly positively skewed and dominated by a relatively small number of high-performing firms. Because most possible outcomes fall below the mean in a skewed distribution, the authors argue financial planning should focus on median outcomes or the full distribution.
  • The Long Goodbye? Incumbent Competitiveness in the 21st Century — Value creation among large American companies has become concentrated in a newer cohort of firms: businesses founded after World War II accounted for 8% of the top 50 companies' total market value in 1990 but 77% by 2024. The leading 20th-century incumbents are fading as this newer group takes over.
  • The Economics of Inequality in High-Wage Economies — Information technology created investment opportunities exceeding the supply of properly trained talent, while trade with low-wage economies, low-skilled immigration, trade deficits, and aging demographics eased constraints on low-skilled labor and risk-averse savings. The author argues this framework, rather than rising cronyism, explains high returns to success, slowing productivity growth, and low interest rates.

AI Summary. Saudi Arabia's balance of payments breakeven exceeds $90 a barrel on about 7m barrels a day of exports, so oil near $100 would not generate a large Saudi surplus. Each $10 rise in oil prices adds roughly $160bn to the import bills of Europe and South and East Asian importers.

Brad Setser Council on Foreign Relations
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Oil settling at ~$100–120 won’t increase the supply of “petrodollars” or capital flows from the Middle East as at the margin the increased East Asian energy spending will largely flow to exporters outside the Gulf.

Would higher oil prices produce a large Saudi surplus?

Core argument: Saudi Arabia's balance of payments breakeven exceeds $90 a barrel on roughly 7 million barrels a day of exports, so oil near $100 would not generate the large surplus a petrodollar system would require.

The Saudis aren’t going to generate a big surplus to reinforce the postulated petrodollar system with oil at around $100—not when their balance of payments breakeven (on around 7 million barrels a day of exports) is over $90 a barrel. But if the benchmark price of oil converges to around $100 for an extended period of time, a bit of Asia’s massive current account surplus will flow to those oil exporters able to supply the global market while flows through the Strait are limited. For reference, the average price of Brent in 2025 was just under $70 a barrel. A $10 barrel increase in the price of oil raises the import bill of Europe and the oil importers of South and East Asia by about $160 billion. East Asia in aggregate imports around 20 million barrels day, so every $10 a barrel raises East Asia’s import bill by $70-80 billion over the course of a year. But East Asia can afford a big shock. A sustained $50 a barrel shock (oil at $120 a barrel) would reduce East Asia’s current account surplus by $350 billion (more, if counting gas), leaving the combined surplus of Korea, Taiwan, Japan, and China well above $1 trillion.

Takeaways by Macro Roundup® AI

  1. Saudi Arabia's balance of payments breakeven exceeds $90 a barrel on roughly 7 million barrels a day of exports, so oil near $100 would not generate the large surplus a petrodollar system would require.
  2. A $10 a barrel increase in oil raises the import bill of Europe and South and East Asian oil importers by about $160 billion, with East Asia's roughly 20 million barrels a day of imports accounting for $70–80 billion.
  3. A sustained $50 a barrel shock, with oil at $120, would cut East Asia's current account surplus by $350 billion, leaving the combined surplus of Korea, Taiwan, Japan, and China well above $1 trillion.

Related Articles:

  • Oil, War and the Global Economy: The Market’s Narrative in March 2026 — Sovereign credit ratings in the war-zone countries have not changed, but market-based measures of default risk have risen across much of the Middle East, with larger increases in Qatar, the United Arab Emirates and Turkey than in Saudi Arabia and Kuwait. The United States has also seen its default-risk spread surge, and global sovereign spreads rose about 12%.
  • Salem’s Lot: Gulf War Update; The Purge Of Senior US Military Officers; A US Fossil Fuel Reliance Fever Dream — The US is not insulated from market effects of a Strait of Hormuz closure: while US natural gas prices have declined this year, most other hydrocarbon and refined product prices have risen materially, with US crude oil, wholesale gasoline, naphtha, shipping fuel and some petrochemical increases exceeding those in Europe and Asia.
  • Are We Running Out Of Oil — An analysis of country- and product-specific oil markets identifies pockets of potential extreme tightness if the Strait of Hormuz remains effectively closed, with critically low supplies of the petrochemical feedstocks naphtha and liquefied petroleum gas in Asia and cross-product scarcity in multiple Asian countries.

AI Summary. The European Union's Industrial Accelerator Act would let member states veto foreign investments above €100mn in strategic sectors such as batteries, electric vehicles, solar panels and critical raw materials when the investor comes from a country holding over 40% of global manufacturing capacity, unless conditions on local jobs, joint ventures, intellectual property, research spending and local sourcing are met.

Barney Jopson, Joe Leahy and Ian Johnston Financial Times
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The EU’s “Made In Europe Act” would condition Chinese market access on IP transfers, FDI and joint ownership in strategic sectors. A Rhodium analysis found there was ~$12B of Chinese greenfield investment in European factories in 2025, 3x the 2022 level.

Should Europe block foreign investment in strategic manufacturing sectors?

Core argument: The EU's Industrial Accelerator Act would let member states veto any foreign direct investment above €100mn in strategic sectors when the investor comes from a country holding more than 40% of global manufacturing capacity.

[The EU's] Industrial Accelerator Act (IAA) [will allow] member states veto any FDI exceeding €100mn in strategic sectors if the investor is from a country with more than 40% of global manufacturing capacity. Those sectors include batteries, EVs, solar panels and the extraction and processing of critical raw materials — all areas where China dominates. To win approval, investment projects must fill at least half of their jobs with EU workers and satisfy three of five other conditions. One is that the investment must be undertaken via a joint venture. Another is that the foreign partner does not own more than 49% of the entity — a condition unpopular with Chinese companies, according to European officials. Other conditions cover the licensing of intellectual property rights, spending 1% of revenue on research and development in the EU, and publishing a strategy for sourcing 30% of inputs from the bloc.

Takeaways by Macro Roundup® AI

  1. The EU's Industrial Accelerator Act would let member states veto any foreign direct investment above €100mn in strategic sectors when the investor comes from a country holding more than 40% of global manufacturing capacity.
  2. The sectors covered by the Industrial Accelerator Act include batteries, EVs, solar panels, and the extraction and processing of critical raw materials, all areas where China dominates.

Related Articles:

  • Sticking with What Works: Raising GDP Forecast on China’s Manufacturing Push — Stronger Chinese growth driven by export-oriented manufacturing may not produce net positive spillovers: for every 1pp export-driven boost to China's GDP, other economies may see a 0.1–0.3pp drag, with high-tech producers such as Europe and Japan facing greater pressure. Cheaper Chinese goods continue to exert a disinflationary impulse.
  • How German Industry Can Survive the Second China Shock — The European Union has 30mm manufacturing jobs, and China has grown from a $4tn economy producing under 15% of global manufacturing output to an $18tn economy producing over a third, with well over 50% of global capacity in many sectors. European tariffs on Chinese electric vehicles limit import competition but do not offset lost export markets.
  • Places versus People: The Ins and Outs of Labor Market Adjustment to Globalization — Analysis of U.S. register data finds that employment levels in places exposed to Chinese import competition more than fully rebound, while employment-to-population ratios stay depressed and manufacturing employment continues to shrink. The authors find the recovery comes almost entirely from young adults and foreign-born immigrants taking first jobs in lower-wage service sectors, with both in- and out-migration remaining depressed.

AI Summary. Ford's chief executive argues Chinese carmakers should be barred from the US market, contending that large direct government support lets them undercut prices and that camera-equipped Chinese vehicles collecting data pose national security risks. He has told US officials that Chinese automakers building cars in America should be required to form joint ventures controlled by US automakers.

Keith Naughton Bloomberg
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Jim Farley the CEO of Ford, argued that allowing Chinese automakers into the American market would be “devastating” to American manufacturing. The US currently has a 100% tariff on Chinese-made electric vehicles.

Should Chinese carmakers be barred from the US market?

Core argument: Ford CEO Jim Farley warned of national security risks from technology-laden Chinese vehicles on US roads, saying "All of these vehicles have 10 cameras" and "They can collect a lot of data.".

The Ford leader contends the “huge direct support” Chinese carmakers receive from their government gives them an unfair advantage to slash prices and decimate domestic automakers in the US, “There is no way this is a fair fight.” Farley also warned of national security risks from allowing technology-laden Chinese vehicles to navigate US roads. “All of these vehicles have 10 cameras,” Farley said. “They can collect a lot of data.” President Donald Trump in January told the Detroit Economic Club he was willing to “let China come in” as long as they built factories and hired American workers. Farley subsequently told administration officials that Chinese carmakers should have to form joint ventures where US automakers hold controlling stakes in order to build cars in America, Bloomberg has reported.

Takeaways by Macro Roundup® AI

  1. Ford CEO Jim Farley warned of national security risks from technology-laden Chinese vehicles on US roads, saying "All of these vehicles have 10 cameras" and "They can collect a lot of data.".
  2. President Donald Trump told the Detroit Economic Club in January he was willing to "let China come in" if Chinese carmakers built factories and hired American workers.
  3. Farley told administration officials that Chinese carmakers should be required to form joint ventures in which US automakers hold controlling stakes in order to build cars in America, Bloomberg has reported.

Related Articles:

  • Canada and China Slash Tariffs As They Mend Ties After Years Of Dispute — Canada agreed to accept 49,000 Chinese electric vehicles at a 6.1% tariff, down from 100%, while China will cut its levy on Canadian canola seed to 15% from an effective rate of about 85%. Canada's canola exports to China were valued at nearly C$5bn (US$3.6bn), and Canada's original 100% electric vehicle tariff was adopted at Washington's urging.
  • Will China Take Over the Global Auto Industry? — The global auto market has historically been regional, with most cars sold in a region also built there. Overcapacity in China's internal combustion sector, expanding electric-vehicle capacity, ample state bank credit, and a weaker yuan could concentrate global auto production in China absent restrictions such as the US 100% tariff on Chinese electric vehicles.
  • Cheap Chinese Cars Are Taking Over Roads From Brazil to South Africa — Inexpensive cars from Chinese makers such as BYD, Chery, Great Wall and SAIC are gaining share in emerging markets, reaching nearly 10% of sales in South Africa, 8% in Turkey and close to a third in Chile. Chinese automakers' market share outside China is projected to rise to 13% by 2030 from 3%.

AI Summary. The average new car transaction price is around $50,000, with new cars under $20,000 essentially unavailable, while auto repair costs rose 15% over the past year to roughly $840 per visit. The author argues the US should stop protecting Detroit and open the market to Chinese cars.

Clifford Winston New York Times
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In 2012, there were ~12 new cars available for around $25,000 in real terms in the US. Today, there are only 4 new cars available at that price point. Clifford Winston notes allowing Chinese imports would likely increase that number to 11.

Would opening the US market to Chinese cars restore affordable vehicles?

Core argument: The average transaction price for a new car sits around $50,000, and in December it became nearly impossible to find a new car for less than $20,000.

The average transaction price for a new car now sits around $50,000. In December, it became just about impossible to find one for less than $20,000. For anyone on a budget, an aging car is a trap. Auto repair costs jumped 15% in the last year alone, driven by the complexity of modern sensors and labor shortages. An average trip to the mechanic now costs roughly $840. To fix the problem, policymakers must overturn what has been for decades the third rail in American politics. It is time to stop coddling Detroit automakers [and open] the American market to cars made in China and elsewhere. Chinese cars aren’t just cheaper than the American alternatives. They’re often better. Take BYD’s slightly more upscale Seal sedan. It’s similar to Tesla’s Model 3, introduced nine years ago. But the Seal costs roughly $20,000 less than the Model 3. The Seal’s premium model offers substantially more horsepower, and its battery not only lasts longer, it can also be 80% charged in just 37 minutes. The Seal isn’t just a budget alternative; it is a more advanced machine.

Takeaways by Macro Roundup® AI

  1. The average transaction price for a new car sits around $50,000, and in December it became nearly impossible to find a new car for less than $20,000.
  2. Auto repair costs rose 15% over the past year, driven by the complexity of modern sensors and labor shortages, with an average trip to the mechanic costing roughly $840.
  3. BYD's Seal sedan costs roughly $20,000 less than Tesla's Model 3, and the Seal's premium model offers substantially more horsepower, a longer-lasting battery, and an 80% charge in 37 minutes.

Related Articles:

AI Summary. Massachusetts caps annual property tax revenue growth at 2.5% unless voters approve an override, and South Hadley voters rejected ballot measures meant to close a $3m deficit driven partly by a 42% jump in healthcare costs and reduced state aid. Municipalities nationwide face the end of federal pandemic aid, higher costs, and state-imposed revenue limits.

Scott Calvert Wall Street Journal
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Voters in South Hadley, MA overwhelmingly rejected a property tax increase by 65 to 34%, that advocates argued was needed to prevent steep cuts in education spending, in part due to a 42% increase in the town’s health care costs.

Will voters reject property tax increases as local budget deficits grow?

Core argument: South Hadley, Massachusetts voters rejected two ballot questions that would have permanently lifted the sum the town can raise through property taxes well above the current $35 million, leaving a $3 million deficit.

Massachusetts law largely caps annual property tax revenue increases at 2.5%. Anything more requires a voter-approved override. Facing a $3 million deficit, South Hadley’s elected selectboard put [two] override questions on the ballot. Either would have permanently lifted the sum that can be raised via property taxes well above the current $35 million. South Hadley’s fiscal plight, driven partly by a 42% jump in healthcare costs and reduced state aid, is a preview of what other communities nationwide can expect, according to Chris Morrill, chief executive of the Government Finance Officers Association, which represents public-finance officials in the U.S. and Canada. Towns across the U.S. are grappling with the end of federal pandemic aid that propped up budgets, along with higher municipal costs and, in many cases, state-imposed revenue limits.

Takeaways by Macro Roundup® AI

  1. South Hadley, Massachusetts voters rejected two ballot questions that would have permanently lifted the sum the town can raise through property taxes well above the current $35 million, leaving a $3 million deficit.
  2. Massachusetts law largely caps annual property tax revenue increases at 2.5% unless voters approve an override, and South Hadley's shortfall was driven partly by a 42% jump in healthcare costs and reduced state aid.
  3. Chris Morrill, chief executive of the Government Finance Officers Association, says South Hadley's fiscal plight previews what other U.S. communities can expect as federal pandemic aid ends alongside higher municipal costs and state-imposed revenue limits.

Related Articles:

  • Massachusetts Loses Billions in Income After Millionaire Tax — Internal Revenue Service data show residents leaving Massachusetts took a net $4.2bn in adjusted gross income with them, an 8% year-over-year increase, in the first year of a 4% surtax on incomes above $1m, though the number of departing taxpayers slowed. Net outflows predate the surtax, and surtax collections have risen every year.
  • The Robin Hood State Is Coming For The Rich — In the US, increased redistribution has offset rising pre-tax inequality: Congressional Budget Office data show inequality of taxable income near record highs while inequality after taxes and transfers was lower than in several earlier years and only slightly above 1986. The top 1% of earners paid 40% of income tax in 2022, up from 33% in 2001.
  • Behavioral Responses to State Income Taxation of High Earners: Evidence from California — A California ballot measure raising top marginal income tax rates by up to 3 percentage points prompted an additional 0.8% of the affected tax base to leave the state, with an estimated income elasticity of 2.5–3.2 for high earners who stayed. The authors estimate these responses eroded 45.2% of windfall revenues within one year and 60.9% within two.

Thursday, April 16, 2026

AI Summary. US stocks look expensive by standard measures while the 10-year Treasury yield sits at 4.3%, higher than at any point in the 13-year rally after the global financial crisis. The excess cyclically adjusted earnings yield, a century-long guide to decade-ahead equity returns, currently signals an unappealing time to buy.

John Authers Bloomberg
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The S&P has rallied ~10.7% over the past two weeks, reaching an all-time high. Only in March 2000 was there a 10-day, 10% rally when stocks had higher earnings multiples than they do now. Such high multiples are historically predictive of subsequent low 10-year returns.

Are stocks expensive relative to bond yields?

Core argument: The 10-year Treasury yield at 4.3% stands higher than at any point during the 13-year equity rally that followed the Global Financial Crisis, while stocks look expensive by any sensible measure.

Stocks look expensive by any sensible measure, while the 10-year Treasury yield sits at 4.3% — higher than at any point during the 13-year rally that followed the Global Financial Crisis. Subtract the bond yield from the earnings yield (the inverse of the price/earnings ratio) of the S&P and you get what Shiller calls the excess CAPE yield. For over a century, this offered a great guide to how equities would fare over the ensuing decade — and it currently suggests that this is an unappealing time to buy into the market. Earnings season is getting underway amid great optimism. That limits potential damage from the war, but can’t explain this two-week rally. Bloomberg’s Earnings Estimates Graphs service shows that forecasts for S&P 500 first-quarter earnings have dropped over that time.

Takeaways by Macro Roundup® AI

  1. The 10-year Treasury yield at 4.3% stands higher than at any point during the 13-year equity rally that followed the Global Financial Crisis, while stocks look expensive by any sensible measure.
  2. Shiller's excess CAPE yield — the S&P earnings yield minus the bond yield — has offered a good guide to decade-ahead equity returns for over a century and currently suggests an unappealing time to buy into the market.
  3. Bloomberg's Earnings Estimates Graphs service shows forecasts for S&P 500 first-quarter earnings have dropped over the two weeks of the rally, which earnings optimism cannot explain.

Related Articles:

  • One Hundred Years in the U.S. Stock Markets — Over a century, U.S. publicly traded stocks generated roughly $91tn in shareholder wealth enhancement, with returns strongly positively skewed and dominated by a relatively small number of high-performing firms. Because most possible outcomes fall below the mean in a skewed distribution, the authors argue financial planning should focus on median outcomes or the full distribution.
  • Everyone’s Looking For A Bubble. No One Sees The Stampede — A proprietary model estimates monthly artificial intelligence revenue grew roughly 18-fold in two years, from $772m to $13.8bn, with AI accounting for an estimated 23% of Google Cloud, 10% of Azure and 5% of Amazon Web Services. The model's ratio of investment to revenue fell from 6.1x to 4.7x, still historically high.
  • Bubbles, Booms and Crashes in the US Stock Market 1792-2024 — US industry booms averaging 300% gains over two years were on average followed by flat prices rather than crashes, according to an analysis of long-run stock market data. Booming and crashing industries are associated with subsequent high volatility, but post-boom performance is not significantly different from unconditional returns once market trends are controlled for.

AI Summary. Private companies account for 63% of US firms with $100m or more in annual revenue, with even higher shares in the EU and UK, and together generate nearly $12tn in annual revenue versus $33tn for public companies. Private equity, at $10.5tn in global assets, is 6x global private credit.

Amanda Lynam, Arun Manohar, Spencer Rogers, Sara Grut, et al. Goldman Sachs
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63% of American firms with $100mm or more of annual revenue are private; the share is even higher in the EU and UK. Private firms across the three generate $12T in annual revenue relative to their public peers’ $33T.

How large is the private company market relative to public markets?

Core argument: 63% of US firms with $100 million or more in annual revenue are private, and the private shares in the EU and UK are even larger, per S&P Capital IQ estimates.

63% of firms in the US with $100 million or more in annual revenue are private, and the shares of private firms in the EU and UK are even larger. This collection of private firms across all three regions represents nearly $12 trillion in aggregate annual revenue, per S&P Capital IQ estimates. For comparison, the annual revenue generated by the public company cohort totaled $33 trillion for the most recent 12-month period. [Exhibit 6 in gallery] frames the global private credit market (using Preqin’s universe, which does not capture BDCs) relative to other alternative asset markets such as private equity. The size differentials are meaningful: at $10.5 trillion in global AUM, private equity is 6x the size of the global private credit market.

Takeaways by Macro Roundup® AI

  1. 63% of US firms with $100 million or more in annual revenue are private, and the private shares in the EU and UK are even larger, per S&P Capital IQ estimates.
  2. Private firms across the US, EU, and UK generate nearly $12 trillion in aggregate annual revenue, compared with $33 trillion for the public company cohort over the most recent 12-month period, per S&P Capital IQ estimates.
  3. Global private equity AUM of $10.5 trillion is 6x the size of the global private credit market, measured using Preqin's universe, which does not capture business development companies.

Related Articles:

  • Public Markets Are a Shrinking Part of the US Economy — S&P 500 companies account for 18% of total US employment, 21% of total US capital expenditure, roughly half of economy-wide corporate profits, and less than half of outstanding corporate debt. Privately owned firms account for almost 80% of job openings, and 81% of firms with revenues above $100m are private.
  • Competitive Advantage Period: The Neglected Value Driver — Data indicate persistence in returns on invested capital has increased since 2000, with large companies the main beneficiaries; the information technology sector's aggregate return was 19% versus a 10.8% median from 1970 to 2024. Of about 13,800 U.S. public firms listing from 1976 to 2019, 18% survived.
  • Echoes of Junk Bonds Past — Annual default rates of 10% for private credit direct lending are within the historical range, and with recovery assumptions implying roughly 50% losses given default, realized losses could run near 5% a year, or 10%+ for weaker credits. Many private credit funds are slow to mark down loans while allowing redemptions at 100 cents on the dollar.

AI Summary. Analysis of ancient DNA from 15,836 West Eurasians estimates selection coefficients at 9.7m genetic variants and finds pervasive directional selection, including increases in genetic scores for light skin pigmentation and negative selection against variants linked to type 2 diabetes risk and psychoses such as schizophrenia and bipolar disorder.

Ali Akbari, Annabel Perry, Alison Barton, Mohammadreza Kariminejad, et al. Nature
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Ancient DNA from 15,836 West Eurasians reveals that natural selection accelerated dramatically in the past 10,000 years, following the agricultural revolution. The strongest selection drove improved immune function and lighter skin pigmentation.

Has human genetic selection continued to shape traits across West Eurasia?

Core argument: Applying a new test for directional selection to ancient DNA from 15,836 West Eurasians, 10,016 with newly reported data, the authors estimate selection coefficients at 9.7 million variants to study how selection shapes the genetic architecture of complex traits.

We present a method for detecting directional selection in ancient DNA time-series data that tests for consistent trends in allele frequency change over time, and apply it to 15,836 West Eurasians (10,016 with new data). We estimate selection coefficients at 9.7 million variants, enabling study of how Darwinian forces couple to allelic effects and shape the genetic architecture of complex traits. We focused on 12 traits of particular interest with significant signals from all three tests (Figure 4). One of the strongest signals is an increase over time in the PGS for light skin pigmentation. Type 2 diabetes risk factors give compelling signals of negative selection. We detected negative polygenic selection against alleles associated today with psychoses such as bipolar disorder and schizophrenia. We finally observed signals of selection for combinations of alleles that today are associated with three correlated behavioural traits: scores on intelligence tests, household income and years of schooling. An important caveat is [that] these effects were measured in industrialized societies, and it remains unclear how these relate to phenotypes that were adaptive in the past.

Takeaways by Macro Roundup® AI

  1. Applying a new test for directional selection to ancient DNA from 15,836 West Eurasians, 10,016 with newly reported data, the authors estimate selection coefficients at 9.7 million variants to study how selection shapes the genetic architecture of complex traits.
  2. Among 12 traits with significant signals from all three tests, one of the strongest is an increase over time in the polygenic score for light skin pigmentation, alongside negative selection on type 2 diabetes risk factors and on alleles associated today with bipolar disorder and schizophrenia.
  3. The authors observed signals of selection on combinations of alleles associated today with intelligence test scores, household income, and years of schooling, while cautioning that these effects were measured in industrialized societies and their relation to past adaptive phenotypes remains unclear.

Related Articles:

  • Pervasive Findings of Directional Selection Realize the Promise of Ancient DNA to Elucidate Human Adaptation — Analyzing ancient DNA for consistent trends in gene-variant frequency over time, the authors report that many hundreds of gene variants were affected by strong directional selection over the last ten millennia. They identify selection for variant combinations today associated with lighter skin color, lower schizophrenia and bipolar risk, slower health decline, and higher intelligence-test scores, income, and schooling.
  • Animal Mutation Rates Reveal Traits That Speed Evolution — An analysis of 68 vertebrate species published in Nature found germline mutation rates varied about 40-fold per generation but roughly 120-fold per year, a wider range than earlier studies suggested. The authors found species with larger effective population sizes had lower mutation rates, evidence for the "drift-barrier hypothesis" that natural selection weakens against mutation in smaller populations.
  • Frontiers Evolutionary Trajectories of Complex Traits in European Populations of Modern Humans — Genome-wide polygenic scores indicate European populations after the Neolithic period show increases in height, educational attainment, and intelligence scores, alongside decreases in scores for unipolar depression. The authors associate this shift from relative stagnation to accelerated evolutionary change with the spread of agriculture and animal domestication.

AI Summary. Correcting for measurement error by using relative rather than absolute correlations among relatives, the authors estimate that educational intergenerational mobility in Denmark and Sweden is much lower than conventionally measured, with parent-child and sibling correlations much higher. They argue Nordic education spending and income compression have at best modestly reduced families' role in children's educational outcomes.

Gregory Clark and Martin Hørlyk Kristensen Historical Economics & Development Group
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After correction for measurement error, Denmark and Sweden show very limited mobility in educational attainment. Indeed, “19th-century England had intergenerational and sibling correlations that only modestly exceed those of modern Denmark and Sweden.”

Is Nordic social mobility much lower than conventionally measured?

Core argument: Correcting for measurement error by comparing relative rather than absolute correlations of relatives, the authors find that educational intergenerational mobility in modern Denmark and Sweden is much lower, and parent–child and sibling correlations much higher, than conventionally measured.

Attempts to compare societies in terms of their degree of social mobility across time and place have often failed to take any account of the problem of measurement error. In this paper we suggest a method of correcting for measurement errors that is based on looking not at the absolute correlation of relatives in outcomes, but at their relative correlation. Applying such methods to Denmark, Sweden and England now, as well as England in the nineteenth century [that] actual educational intergenerational mobility rates in modern Denmark and Sweden are much lower than conventionally measured, [and] the correlation of parents and siblings in educational attainment is much higher than conventionally measured. Denmark and Sweden’s more generous public support of education, and compression of household income inequalities, has at best modestly reduced the importance of families in determining child educational outcomes. Table 3 suggests that Denmark and Sweden have underlying social mobility rates that are similar, though not quite as high, as modern England, across all three dimensions of mobility. Marital assortment is as strong in the Nordic countries as in modern England, and intergenerational and sibling correlations are nearly as high. Even more remarkable in Table 3 is that nineteenth-century England had intergenerational and sibling correlations that only modestly exceed those of modern Denmark and Sweden.

Takeaways by Macro Roundup® AI

  1. Correcting for measurement error by comparing relative rather than absolute correlations of relatives, the authors find that educational intergenerational mobility in modern Denmark and Sweden is much lower, and parent–child and sibling correlations much higher, than conventionally measured.
  2. The authors report that Denmark and Sweden have underlying social mobility rates similar to, though not quite as high as, modern England across intergenerational, sibling, and marital dimensions, with marital assortment as strong in the Nordic countries.
  3. Denmark and Sweden's more generous public support of education and compression of household income inequalities have at best modestly reduced the importance of families in determining children's educational outcomes, and nineteenth-century England's intergenerational and sibling correlations only modestly exceed theirs.

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  • For Whom the Bell Curve Tolls: A Lineage of 400,000 English Individuals 1750-2020 Shows Genetics Determines Most Social Outcomes — A study of 402,000 English individuals across 1750–2020 estimates an intergenerational occupational status correlation of 0.88 and a genetic correlation between spouses of 0.76, which the authors interpret as a strong genetic basis for the persistence of social status. The authors argue that highly assortative mating around status genetics limits what policy can do to raise social mobility.
  • The Returns to Education: A Meta-Study — A meta-study of 79 causal estimates finds an average 8.2% earnings gain per year of education, matching earlier work, but also finds evidence of publication bias favoring statistically significant and positive estimates. Correcting for these biases implies an average causal return in the 0%–3% range.

AI Summary. High school varsity athletes are absent about 1.37 percentage points less often than non-athletes over the school year, nearly 20% lower, after controlling for factors linked to both sports participation and attendance. Athletes' absence rates fall further while their sport is in season, which the authors argue suggests participation itself improves attendance.

Nat Malkus and Sam Hollon American Enterprise Institute
Date Posted:
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The absentee rate of Indiana high school students, ~23% of whom played a varsity sport, was ~20% lower for those who participated in varsity athletics than for non-athletes. The effect was stronger when an athlete’s particular sport was in season.

Does playing high school varsity sports reduce student absenteeism?

Core argument: High school varsity athletes' absence rate across the school year was 1.37 points lower than non-athletes', a reduction of almost 20%, after controlling for factors that matter for both sports participation and attendance.

We find that varsity sports participation is strongly associated with better student attendance, and we argue it is plausible that varsity sports participation causes better attendance. When we control for a number of factors that we know matter for both sports participation and attendance, we continue to find that varsity athletes are absent less often than their peers across the entire year. Across the school year, athletes’ absence rate was 1.37 points lower than non-athletes’. That’s a reduction of almost 20%. The broad pattern shown in Table 1 is that students from more advantaged groups were more likely to participate in varsity sports and less likely to be absent from school. It’s thus no surprise that, in the raw data, there is an association between playing varsity sports and having good attendance (Figure 3). But is that because students who attend school more reliably are more likely to play sports or because playing sports leads to better attendance? One way to tease out the answer is to compare varsity athletes' attendance during their sports seasons with their attendance the rest of the year. Not only do varsity athletes have lower annual absence rates—especially unexcused absences—than non-athletes, but [Figure 3 and Figure 4] show that their absence rates fall further when their sport is in season, [which suggests at least some causal effect].

Takeaways by Macro Roundup® AI

  1. High school varsity athletes' absence rate across the school year was 1.37 points lower than non-athletes', a reduction of almost 20%, after controlling for factors that matter for both sports participation and attendance.
  2. Varsity athletes' absence rates fall further when their sport is in season, which the authors argue suggests at least some causal effect of participation on attendance.
  3. Students from more advantaged groups were more likely to play varsity sports and less likely to be absent, producing an association in the raw data between varsity participation and good attendance.

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  • Long COVID for Public Schools: Chronic Absenteeism Before and After the Pandemic — Nationwide chronic absenteeism — the share of students missing at least 10% of a school year — rose from 15% in 2018 to 28% in 2022, and although rates improved in 2023, they remained 75% above the pre-pandemic baseline. Chronic absenteeism is associated with lower standardized test scores, with the highest rates in lower-achieving, higher-poverty districts.
  • The Latest Chronic Absenteeism Numbers — Chronic absenteeism—students missing 10% or more of the school year—rose from 15% of K–12 students before the pandemic to 28%, then eased to 26% in the first full post-pandemic school year. Data from eight states show continued declines, including New Mexico's drop from 40% to 33%, but rates remain well above pre-pandemic levels.

AI Summary. The Pentagon has approached U.S. automakers and other manufacturers about using their workers and factory capacity to boost production of munitions and other equipment as wars deplete stocks, asking whether they could rapidly shift to defense work. Most large non-defense manufacturers already hold Pentagon contracts, but these are typically limited in scope and value.

Sharon Terlep and Marcus Weisgerber Wall Street Journal
Date Posted:

The Pentagon is in talks with several firms, including GE Aerospace, GM, and Ford, about repurposing existing manufacturing capacity to increase production of munitions.

Can civilian manufacturers rapidly shift capacity to weapons production?

Core argument: The Pentagon has approached U.S. automakers and other manufacturers about using their personnel and factory capacity to boost production of munitions and other equipment as the wars in Ukraine and Iran deplete stocks.

The Pentagon is interested in enlisting the companies to use their personnel and factory capacity to increase production of munitions and other equipment as the wars in Ukraine and Iran deplete stocks. Defense officials said American manufacturers might be needed to backstop traditional defense companies and asked whether the companies could rapidly shift to defense work. Repurposing domestic manufacturing for military use has a precedent. Detroit’s automakers halted car production during World War II to churn out bombers, aircraft engines and trucks, as America’s “Arsenal of Democracy.” Today, much of military production is done by a limited number of contractors. While many of the largest U.S. manufacturers outside the traditional defense sector already hold Pentagon contracts, most are limited in scope and dollar value, often confined to niche research or specific products.

Takeaways by Macro Roundup® AI

  1. The Pentagon has approached U.S. automakers and other manufacturers about using their personnel and factory capacity to boost production of munitions and other equipment as the wars in Ukraine and Iran deplete stocks.
  2. Defense officials said American manufacturers might be needed to backstop traditional defense companies and asked whether those firms could rapidly shift to defense work, with much of military production done by a limited number of contractors.
  3. Many of the largest U.S. manufacturers outside the traditional defense sector already hold Pentagon contracts, but most are limited in scope and dollar value, often confined to niche research or specific products.

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