Edward Conard

Top Ten New York Times Bestselling Author

  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “Unintended Consequences offers deep and well-argued analyses on almost every issue.” - The New York Times
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “Unintended Consequences represents the most cogent and persuasive analysis of the Financial Crisis to date.” - Andrei Shleifer, 1999 John Bates Clark Medal Winner
  • “There are an amazing number of good ideas and interesting points made in Unintended Consequences. The thinking underlying it, and the obvious depth of understanding of the author, are very impressive.” - Steven Levitt, coauthor of Freakonomics; 2004 John Bates Clark Medal
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “A full-throated defense of economic dynamism.” - The Wall Street Journal
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “Unintended Consequences 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
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Tuesday, August 25, 2026

AI Summary. The long-term Treasury yield is the most important price in the world, and markets aggregate information no committee possesses. The author argues the Treasury's larger buyback operations were not justified as liquidity support, since trading was orderly, volatility contained, and there were no failed auctions or forced unwinds indicating dysfunction.

Stanley Druckenmiller Wall Street Journal
Date Posted:

Stan Druckenmiller cautions that there is no question that the Treasury’s efforts to cap long-term yields will fail: “Governments defending prices against fundamentals always lose. The only variable is how much they spend before conceding.”

Does intervening in a working bond market suppress its price signal?

Core argument: The long-term Treasury yield is the most important price in the world, and markets aggregate information no committee possesses, with prices serving as the channel through which that information reaches decision makers.

Markets aggregate information no committee possesses, and prices are how that information reaches decision makers. The long-term Treasury yield is the most important price in the world. Treasury’s announcement gave the game away. It justified the larger operations as liquidity support in sectors with “consistent strong sponsorship from market participants,” but strong sponsorship is the definition of a healthy, working market. There were no failed auctions, no dealer balance-sheet seizure, no forced unwinds, nothing resembling Treasurys in March 2020 or U.K. gilts in September 2022, the sort of genuine dysfunctional episodes that justify official action. Volatility was contained, and trading was orderly—not a malfunction but the machine doing its job.

Takeaways by Macro Roundup® AI

  1. The long-term Treasury yield is the most important price in the world, and markets aggregate information no committee possesses, with prices serving as the channel through which that information reaches decision makers.
  2. Treasury justified its larger operations as liquidity support in sectors with "consistent strong sponsorship from market participants," though strong sponsorship is the definition of a healthy, working market.
  3. Treasury markets showed no failed auctions, no dealer balance-sheet seizure and no forced unwinds, unlike the dysfunctional episodes of Treasurys in March 2020 and U.K. gilts in September 2022 that justify official action.

Related Articles:

  • US 30-Year Bonds Erase Gains From Treasury’s Buyback Surprise — US Treasuries erased nearly all gains that followed the Treasury Department's surprise decision to increase buybacks of longer-dated bonds, with the 30-year yield rising above 5.27% and the 10-year touching 4.71%. The reversal signals the move has done little to ease concern about surging government debt.
  • What Are US Treasury Markets Really Telling Us? Part I — Comparing US Treasury yields to AAA corporate bonds combined with credit default swap insurance creates a synthetic Treasury, and the resulting spread — the convenience yield investors give up for safety and liquidity — has disappeared, suggesting investors are indifferent between the two on safety and liquidity. The author argues this is bad news for US taxpayers.
  • America’s Risky Debt: What Markets See That Policymakers Don’t — Two market-based measures suggest the safety premium investors pay to hold US Treasuries has compressed toward zero and at times reversed: the spread between top-rated corporate bonds and Treasuries after stripping out default risk, and the gap between currency-hedged foreign G10 government yields and Treasury yields at the same maturity, where longer-maturity comparisons now favor foreign bonds.

AI Summary. Foreign ownership of US Treasury securities has shifted from official investors, who held the predominant share in 2008, toward private investors, whose holdings of $6.7tn now exceed official holdings of $3.9tn. Net issuance of Treasury securities boomed during and after the COVID pandemic, even accounting for Federal Reserve purchases that reduce net market supply.

Anusha Chari and Gian Maria Milesi-Ferretti Brookings Institution
Date Posted:
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The composition of foreign ownership of U.S. Treasury debt has shifted sharply from official to private investors over the past two decades. Foreign private investors now hold $6.7T in Treasuries, vastly exceeding the $3.9T held by foreign official institutions.

Have private foreign investors overtaken official ones in holding Treasuries?

Core argument: Foreign private holdings of U.S. Treasury securities reached $6.7 trillion in mid-2025, including the Cayman Islands correction, exceeding official foreign holdings of $3.9 trillion.

Figure 5 shows a large shift in foreign holdings of US Treasurys: a diminishing role for official investors, who accounted for the predominant share in 2008, offset by a rising role for private investors. Figure 6 shows net issuance and purchases of U.S. Treasury securities during the past 25 years. The boom in net issuance during and after the COVID pandemic is particularly striking, even after controlling for the net purchases by the Fed which reduce net market supply. Foreign net purchases show a notable shift toward private purchases relative to the 2000s. As a result, foreign private holdings of U.S. Treasury securities in mid-2025 ($6.7 trillion, including the Cayman Islands correction) vastly exceed official holdings of $3.9 trillion.

Takeaways by Macro Roundup® AI

  1. Foreign private holdings of U.S. Treasury securities reached $6.7 trillion in mid-2025, including the Cayman Islands correction, exceeding official foreign holdings of $3.9 trillion.
  2. Foreign official investors accounted for the predominant share of foreign Treasury holdings in 2008, and their diminishing role has been offset by a rising role for private investors.
  3. Net issuance of U.S. Treasury securities boomed during and after the COVID pandemic, even after controlling for Federal Reserve net purchases that reduce net market supply, alongside a shift in foreign net purchases toward private buyers relative to the 2000s.

Related Articles:

  • Mid-Year Outlook: At the Crossroads of Stagflation—What’s Next? — Foreign investors hold roughly $18.5tn in US equities (about 20% of the market), $7tn in Treasuries and $5tn in credit (about 30% of each), and foreign participation in 30-year Treasury auctions has trended down in recent months. Combined with US fiscal challenges, the authors argue this reliance on foreign demand is a vulnerability.
  • Tariffs and “International Payments Problems” — Foreigners are accumulating more financial claims on Americans than Americans are on foreigners across direct investment, stocks, bonds, currency, deposits, and loans, and the U.S. net international investment position has moved from -20% of GDP in 2010 to -89%. Almost all of that swing reflects valuation gains on U.S. stocks rather than added borrowing.
  • Global Trade Imbalances: Actual Problems, Unlikely Solutions — Foreign capital flowing into the US is shifting from government purchases of US Treasury bonds toward private foreign investment in US stocks and other riskier assets. This means a share of future gains from US productivity-enhancing investment will flow to these foreign investors, who are likely more willing to sell and exit if returns worsen.

AI Summary. Artificial caps on government bond yields in high-debt countries are argued to be negative for the currency and capable of sparking a devaluation spiral, as Japan's experience suggests, pushing markets toward safe havens against debt monetization. The dollar has fallen sharply following a bond buyback announcement while gold is up over 7%.

Robin Brooks Robin Brooks Substack
Date Posted:

Gold has risen 7% since Treasury’s buyback announcement, and the dollar has continued to fall relative to G10 and EM currencies as investors seek safe havens from “debt monetization.”

Do artificial bond yield caps weaken a high-debt country's currency?

Core argument: Gold is up over 7% and the dollar has fallen sharply since the buyback announcement, with markets jumping on what the author calls the debasement trade.

The more high-debt countries blunder into artificial yield caps, which is where the US is heading, the more markets seek safe havens from debt monetization. The lesson from Japan is that artificial yield caps are currency negative and can spark a devaluation spiral. The Dollar has fallen sharply since last week’s buyback announcement and gold is now up over seven percent. Markets know exactly what game is being played and are happy to jump on the debasement trade.

Takeaways by Macro Roundup® AI

  1. Gold is up over 7% and the dollar has fallen sharply since the buyback announcement, with markets jumping on what the author calls the debasement trade.
  2. The author argues that as high-debt countries, including the US, blunder into artificial yield caps, markets increasingly seek safe havens from debt monetization.
  3. The author draws from Japan's experience the lesson that artificial yield caps are currency negative and can spark a devaluation spiral.

Related Articles:

  • The Global Fiscal Train Wreck — Ten-year forward yields ten years ahead have risen across major advanced economies, not just the US, a global theme the author attributes to the debt buildup during the pandemic. The author argues economies have begun shifting from a good to a bad debt equilibrium, which he sees behind the rally in precious metals prices tied to a "debasement trade.
  • The Coming Great Repression? — Across countries and over time, higher public debt burdens are associated with lower relative returns on government bonds, the opposite of standard risk-premium predictions. The authors estimate financial repression—making banks captive bond buyers and loading them with low-return reserves—contributed 90.7 percentage points of GDP to Britain's postwar debt reduction, versus 20.3 from surprise inflation.
  • Global Debt Report 2026 — Gross central government borrowing across OECD countries rose 7% to a record $17tn, about 23% of GDP, and is projected to reach roughly $18tn, or 24% of GDP. The United States and Japan account for close to 80% of the area's refinancing requirements, with the US share rising from 57% to 70%.

AI Summary. The narrowing gap in unemployment rates between young college graduates and non-graduates appears driven mainly by non-graduates dropping out of the labor force rather than by diplomas losing value, since people not seeking work aren't counted as unemployed. The share of young non-graduates employed is 1.7 percentage points below pre-pandemic levels.

Justin Fox Bloomberg
Date Posted:
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Labor force participation is rising for American college graduates aged 25–29, and is now at 89.4% – above its pre-pandemic level. Participation among non-college members of that age cohort is falling; at 78.7%, it is now below its pre-pandemic level.

Is the narrowing unemployment gap driven by non-graduates leaving the workforce?

Core argument: The employment-population ratio for young adults without college degrees is 1.7 percentage points below its pre-pandemic level and trending downward, while the ratio for young college graduates sits near its pre-pandemic level.

The narrowing of [the unemployment gap btw college and non-college workers] in recent years has lent support to narratives that college diplomas are losing their value amid the rise of large language models, the purported return of blue-collar work, and other job market changes. But while it may well be that diplomas have lost value, the recent shrinking of the young-adult education-unemployment gap seems to be driven mainly by a different phenomenon. Growing numbers of young adults without college degrees simply aren’t trying to find work and thus aren’t counted in unemployment calculations. The employment-population ratio for young college grads is not far off from where it was just before the pandemic and seems as if it might be headed upward again after a sharp drop in 2023 and 2024, for non-grads it is 1.7 percentage points lower than before the pandemic and clearly trending downward.

Takeaways by Macro Roundup® AI

  1. The employment-population ratio for young adults without college degrees is 1.7 percentage points below its pre-pandemic level and trending downward, while the ratio for young college graduates sits near its pre-pandemic level.
  2. The narrowing unemployment gap between young college and non-college workers appears driven mainly by growing numbers of non-graduates who are not seeking work and therefore are not counted as unemployed.
  3. The employment-population ratio for young college graduates fell sharply in 2023 and 2024 and appears as if it might be headed upward again.

Related Articles:

  • Labor Force Participation Is High If You Measure It Right — The headline labor force participation rate — the share of people 16 and older working or looking for work — is a limited gauge of labor market health because participation varies greatly by age. Aging baby boomers and the addition of nearly 1.7m Americans 65 and older to population estimates add distortion.
  • How Labor Force Participation Has Diverged Across Genders — Between 1976 and 2024 the trend labor force participation rate fell 10.1 percentage points for men and rose 8.2 points for women. Population aging lowered participation by about 4 points for each gender and rising education raised it (+6 for women, +3 for men), but the divergence is dominated by participation trends within age-gender groups.
  • AI, Immigration, and Collapsing Labor Force Participation — As labor force participation falls, a shrinking group of workers generates the income, taxes, and innovation supporting a growing number of non-workers, leaving the economy more fragile because labor shocks are concentrated among fewer participants. Labor scarcity raises the return on automation, robotics, and software, making growth depend on productivity rather than participation.

AI Summary. Official Spanish data show births exceeded deaths by barely 200,000 over the first quarter of the 21st century—less than 0.5% of Spain's population at the start—while immigration accounted for 98% of the country's population growth, the largest increase of any European Union member. Deaths have exceeded births since 2015.

Nicholas Eberstadt American Enterprise Institute
Date Posted:
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Btw 2000 and 2025, ~98% of Spain’s population growth was due to immigration. In 2024, about one-third of babies born in Spain had a foreign-born mother.

Has immigration accounted for nearly all of Spain's population growth?

Core argument: Immigration accounted for 98% of Spain's population growth between 2000 and 2025, according to official Spanish data.

Without immigration, Spain’s population would have stagnated in the first quarter of the 21st century. According to official Spanish data, births exceeded deaths by barely 200,000 for the 2000-2025 period (2025 numbers still provisional)—or less than one half of 1% of Spain’s 2000 population. Thanks to its robust immigration inflows, however, Spain registered more population growth than any other EU country between 2000 and 2025. Virtually all (98%) of Spain’s population growth was due to immigration during those years. And since deaths have exceeded births in Spain since 2015, any future growth would have to come entirely from additional immigration.

Takeaways by Macro Roundup® AI

  1. Immigration accounted for 98% of Spain's population growth between 2000 and 2025, according to official Spanish data.
  2. Spain's births exceeded deaths by barely 200,000 over 2000–2025, with 2025 figures still provisional, less than one half of 1% of Spain's 2000 population.
  3. Spain registered more population growth than any other EU country between 2000 and 2025 on the strength of immigration inflows, and with deaths exceeding births since 2015, any future growth would have to come entirely from additional immigration.

Related Articles:

  • European Stagnation Is Real — Comparing the United States, France, and Germany at current purchasing power parity prices shows the European economies roughly constant relative to America since 2000, but current-price measures miss output gains in sectors where prices fall, such as software. The author argues constant-price comparisons, the standard approach for growth over time, reveal greater European stagnation.
  • Four Ways Europe’s Big Immigration Experiment Has Changed Spain — Spain has been the world's fastest-growing large advanced economy and, by Financial Times analysis, accounted for one in four of the 11.1mn jobs added across the European Union, with roughly 70% going to immigrants according to the think-tank Funcas. Spain's fertility rate of 1.1 births per woman is the EU's lowest after Malta.
  • Depopulation Globally and in the Asia-Pacific: The Shape of Things to Come — Population aging and fertility below replacement levels are connected to a revolution in family structure in which families grow smaller, fewer people marry, and voluntary childlessness becomes common across countries. As a result, families become less able to bear the demands that may be placed on them.

AI Summary. Australia has begun vaccinating at-risk bird species against H5N1 bird flu, including 5,000 little penguins in Victoria, and has confirmed its first case in a long-nosed fur seal, a species for which no vaccine is approved. The government says the disease has not reached poultry or farms and human risk remains low.

Laura Chung New York Times
Date Posted:

Australia confirmed its first case of H5N1 in June, and the virus has since rapidly spread, with at least 309 confirmed bird flu events that have killed more than 1,000 birds.

Can vaccinating wild birds contain a bird flu outbreak spreading to mammals?

Core argument: The Australian government began vaccinating at-risk bird species, including 5,000 little penguins in Victoria.

The Australian government began vaccinating at-risk bird species this month. Among those receiving the vaccination will be 5,000 little penguins in the state of Victoria. Authorities confirmed the first case of H5N1 in a long-nosed fur seal in South Australia last week. A second seal was suspected to have died from the disease on Monday. A vaccine has not yet been approved for use in Australian mammals. The disease has not been detected in poultry or on farms, according to the government, and the risk to humans remains low.

Takeaways by Macro Roundup® AI

  1. The Australian government began vaccinating at-risk bird species, including 5,000 little penguins in Victoria.
  2. Australian authorities confirmed the first H5N1 case in a long-nosed fur seal in South Australia, and a second seal was suspected of dying from the disease.
  3. No vaccine has been approved for use in Australian mammals, and the government reports H5N1 has not been detected in poultry or on farms, with the risk to humans remaining low.

Related Articles:

Wednesday, August 26, 2026

AI Summary. US Treasuries have outperformed equivalent-maturity interest-rate swaps, narrowing the 30-year swap spread to its tightest level in months and compressing the 10-year gap to around 38 basis points, a gauge of investors' willingness to hold government bonds. Pimco argues that buybacks may technically lower long-end yields, but structural US budget deficits requiring heavy Treasury issuance are not changing.

Greg Ritchie and Elizabeth Stanton Bloomberg
Date Posted:
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Modest compression of the spreads between Treasury yields and synthetic “swap” securities (~5.5bp for the 30 year and ~3bp for the 10 year) suggest Bessent’s Treasury purchase program has had a degree of success at lowering long-term government yields.

Do Treasury buybacks lower long-term yields despite ongoing deficits?

Core argument: Treasuries have outperformed equivalent-maturity swaps since Bessent's announcement, narrowing the 30-year swap spread to its smallest since February, with the 10-year swap spread three basis points smaller at around 38 basis points.

Since Bessent’s announcement, Treasuries have outperformed equivalent-maturity swaps, narrowing the 30-year spread to the smallest since February. Swaps are popular with some investors as an alternative to owning bonds; the gap between [swap rates] and US government yields [gauges] how willing [investors] are to hold Treasuries instead. The 10-year swap spread has compressed too, with the gap three basis points smaller at around 38 basis points. Still, the recent drop has only dented a years-long rise in long-term US government borrowing costs. The 10-year US yield inched up 3bp to 4.66% after touching 4.75% last week. “While conducting buybacks at the long end of the yield curve may technically decrease yields, higher structural US budget deficits, which [require] a significant supply of Treasuries to finance the US debt, [are] not changing anytime soon,” said Libby Cantrill, head of public policy at Pimco.

Takeaways by Macro Roundup® AI

  1. Treasuries have outperformed equivalent-maturity swaps since Bessent's announcement, narrowing the 30-year swap spread to its smallest since February, with the 10-year swap spread three basis points smaller at around 38 basis points.
  2. The 10-year US yield rose three basis points to 4.66% after touching 4.75%, and the recent decline has only dented a years-long rise in long-term US government borrowing costs.
  3. Pimco head of public policy Libby Cantrill said that while buybacks at the long end of the yield curve may technically decrease yields, higher structural US budget deficits requiring significant Treasury supply are not changing anytime soon.

Related Articles:

  • Let the Bond Market Speak — The long-term Treasury yield is the most important price in the world, and markets aggregate information no committee possesses. The author argues the Treasury's larger buyback operations were not justified as liquidity support, since trading was orderly, volatility contained, and there were no failed auctions or forced unwinds indicating dysfunction.
  • US 30-Year Bonds Erase Gains From Treasury’s Buyback Surprise — US Treasuries erased nearly all gains that followed the Treasury Department's surprise decision to increase buybacks of longer-dated bonds, with the 30-year yield rising above 5.27% and the 10-year touching 4.71%. The reversal signals the move has done little to ease concern about surging government debt.
  • America’s Risky Debt: What Markets See That Policymakers Don’t — Two market-based measures suggest the safety premium investors pay to hold US Treasuries has compressed toward zero and at times reversed: the spread between top-rated corporate bonds and Treasuries after stripping out default risk, and the gap between currency-hedged foreign G10 government yields and Treasury yields at the same maturity, where longer-maturity comparisons now favor foreign bonds.

AI Summary. The trend unemployment rate is estimated to have fallen from 7.8% in 1976 to 4.8% in 2024, a decline of about 3.3 percentage points, with a little more than half attributed to changes in workforce composition. Rising educational attainment is the largest compositional factor, lowering the trend by about 1 percentage point.

Andreas Hornstein, Marianna Kudlyak, Greeshma Avaradi and Taerin Kim Federal Reserve Bank of San Francisco
Date Posted:
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Hornstein et al find that about half of the ~3pp drop in the trend unemployment rate since 1976 is due to compositional change in the work force towards lower unemployment “types ” – in particular, older and more educated workers.

Why has the trend unemployment rate declined over recent decades?

Core argument: The estimated trend unemployment rate fell from 7.8% in 1976 to 4.8% in 2024, a decline of about 3.3 percentage points, with changes in workforce composition accounting for a little more than half of it.

We find that the trend unemployment rate declined from 7.8% in 1976 to 4.8% in 2024 [Figure 1]. Roughly half of that decline reflects compositional change. Figure 2 separates the estimated cumulative change in the annual unemployment trend since 1976 into its components. The total decline was about 3.3 percentage points by 2024. Changes in workforce composition account for a little more than half of that decline. Rising educational attainment is the single largest compositional force, lowering the trend about 1pp. Figure 4 plots estimated education shares for entering cohorts of women, and these patterns are similar for male cohorts (not shown). The figure shows a steady long-run fall in the share of new female cohorts with less than high school education and a steady rise in the share with some college or a college degree. [Returning to Figure 2], changes in group-specific LFP rate trends contribute only ~0.3 pp. The remaining decline, a bit under 1pp, comes from lower group-specific trend unemployment.

Takeaways by Macro Roundup® AI

  1. The estimated trend unemployment rate fell from 7.8% in 1976 to 4.8% in 2024, a decline of about 3.3 percentage points, with changes in workforce composition accounting for a little more than half of it.
  2. Rising educational attainment is the single largest compositional force in the decomposition, lowering the trend unemployment rate by about 1 percentage point.
  3. Changes in group-specific labor force participation rate trends contribute about 0.3 percentage point of the decline, while lower group-specific trend unemployment accounts for a bit under 1 percentage point.

Related Articles:

  • Global Views: They’re Not Hiking — Estimated underlying trend job growth slowed to about 5k, below the estimated 50k breakeven pace, so similar readings would likely reverse part of the unemployment rate's decline from 4.5% to 4.1%. The authors argue that decline reflects lower labor force participation rather than higher employment, with wage growth still weak.
  • Labor Force Participation Is High If You Measure It Right — The headline labor force participation rate — the share of people 16 and older working or looking for work — is a limited gauge of labor market health because participation varies greatly by age. Aging baby boomers and the addition of nearly 1.7m Americans 65 and older to population estimates add distortion.

AI Summary. Spain's first- and second-generation immigrant population totals at least 12mm—nearly 9.5mm immigrants and over 2.5mm descendants—out of a population of roughly 49mm. The authors estimate over a third of Spain's under-40 population and nearly two-fifths of children under 5 are immigrants or the children of immigrants.

Nicholas Eberstadt American Enterprise Institute
Date Posted:

Spain’s population of first and second generation immigrants from Latin America (~5.7mm), and Morocco or other African countries (~2.4mm), accounts for nearly one sixth of Spain’s population. There are ~37mm native Spaniards.

How large is Spain's first- and second-generation immigrant population?

Core argument: Spain's first- and second-generation immigrant population totals at least 12 million—almost 9.5 million immigrants and over 2.5 million descendants—out of a population of roughly 49 million at the start of 2025.

Spain’s first and second-generation immigrant population comprises at least 12 million—almost 9.5 million immigrants and over 2.5 million of their descendants. [Spain’s population was ~49mm at the starts of 2025.] Over a third of Spain’s under 40 population are now first or second generation immigrants. And our numbers suggest that nearly two-fifths of Spain’s children under 5 are the children of immigrants, or immigrants themselves. Since our method misses second-generation immigrants not living with their parents, the absolute and relative size of Spain’s mass migration population is likely somewhat greater than we estimate.

Takeaways by Macro Roundup® AI

  1. Spain's first- and second-generation immigrant population totals at least 12 million—almost 9.5 million immigrants and over 2.5 million descendants—out of a population of roughly 49 million at the start of 2025.
  2. Over a third of Spain's under-40 population are first- or second-generation immigrants, and the estimates suggest nearly two-fifths of children under 5 are immigrants or the children of immigrants.
  3. Because the estimating method misses second-generation immigrants not living with their parents, Spain's mass migration population is likely somewhat larger in both absolute and relative terms than the figures indicate.

Related Articles:

  • Quo Vadis, Hispania? Part One — Official Spanish data show births exceeded deaths by barely 200,000 over the first quarter of the 21st century—less than 0.5% of Spain's population at the start—while immigration accounted for 98% of the country's population growth, the largest increase of any European Union member. Deaths have exceeded births since 2015.
  • Four Ways Europe’s Big Immigration Experiment Has Changed Spain — Spain has been the world's fastest-growing large advanced economy and, by Financial Times analysis, accounted for one in four of the 11.1mn jobs added across the European Union, with roughly 70% going to immigrants according to the think-tank Funcas. Spain's fertility rate of 1.1 births per woman is the EU's lowest after Malta.
  • Depopulation Globally and in the Asia-Pacific: The Shape of Things to Come — Population aging and fertility below replacement levels are connected to a revolution in family structure in which families grow smaller, fewer people marry, and voluntary childlessness becomes common across countries. As a result, families become less able to bear the demands that may be placed on them.

AI Summary. The US Department of Defense's budget documents indicate low-cost munitions will reach scale before most advanced systems, with multi-year agreements projected to raise PAC-3 MSE interceptor capacity 233% to 2,000 per year, THAAD interceptors 317% to 400, and Precision Strike Missile output fourfold to about 550.

Jerry McGinn and A.J. Dilts Center for Strategic and International Studies
Date Posted:

Lower cost munitions (under $600,000 per unit) will potentially start to arrive at scale over the next 18 to 24 months as production of higher quality exquisite systems ramps up. Capex of major defense contractors has risen 31% y/y as of Q2 as they expand production capacity.

How fast can defense munitions production capacity expand?

Core argument: Under framework agreements with Lockheed Martin of up to seven years, the DOD anticipates raising PAC-3 MSE interceptor capacity by 233%, from roughly 600 to 2,000 per year by 2030, and THAAD output by 317%, from 96 to 400 annually.

DOD budget documents confirm that low-cost systems will arrive at scale before most exquisite systems, as illustrated in Figure 2. Across framework agreements with Lockheed Martin of up to seven years, the DOD anticipates growing the production capacity of PAC-3 MSE interceptors by 233%, from roughly 600 to 2,000 interceptors per year by 2030; THAAD interceptor output capacity by 317%, from 96 to 400 units annually; and annual Precision Strike Missile production capacity fourfold to roughly 550 missiles. Backed by a DOD procurement commitment of up to seven years, RTX also plans to raise annual production of the Tomahawk missile to more than 1,000, the Advanced Medium-Range Air-to-Air Missile to over 1,900, and the Standard Missile 6 (SM-6) to over 500.

Takeaways by Macro Roundup® AI

  1. Under framework agreements with Lockheed Martin of up to seven years, the DOD anticipates raising PAC-3 MSE interceptor capacity by 233%, from roughly 600 to 2,000 per year by 2030, and THAAD output by 317%, from 96 to 400 annually.
  2. Backed by a DOD procurement commitment of up to seven years, RTX plans to lift annual production of the Tomahawk to more than 1,000 missiles, the Advanced Medium-Range Air-to-Air Missile to over 1,900, and the SM-6 to over 500.
  3. DOD budget documents indicate low-cost systems will arrive at scale before most exquisite systems, with annual Precision Strike Missile production capacity set to grow fourfold to roughly 550 missiles.

Related Articles:

  • Is the Industrial Base on a Wartime Footing? A Progress Report — About 10,000 new firms have entered the US defense market in two years, and nontraditional companies received over $120bn in contract obligations in fiscal 2025, while munitions contract obligations have risen 330% since fiscal 2010. The Defense Department is signing large-scale multiyear munitions agreements and backing a rare earth supply chain outside Chinese control.
  • America’s Fight Back Against China Starts In Los Angeles—In Flip-Flops — El Segundo, California has developed a self-reinforcing entrepreneurial cluster of defense and hardware startups founded by former employees of SpaceX, Palantir and Anduril who cashed in stock options to launch their own firms. One of them, drone maker Neros, says it has America's highest drone production rate and has worked to remove Chinese technology, including circuit boards, from its products.
  • The Intellectual Spoils of War? Defense RD, Productivity and International Spillovers — The authors estimate that a 10% increase in government-financed R&D, largely defense, is associated with a 4.3% rise in privately funded R&D across OECD countries, indicating "crowding in" rather than "crowding out." They also find international spillovers raise private R&D abroad, though the overall effect on US productivity growth is modest.