Edward Conard

Top Ten New York Times Bestselling Author

  • “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
  • “…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 very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “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
  • “…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
  • “Unintended Consequences provides a provocative interpretation of the causes of the global financial crisis and the policies needed to return to rapid growth. Whether you agree or not, this analysis is well worth reading.” - Nouriel Roubini, New York University; Chairman, Roubini Global Economics
  • “…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
  • “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
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Thursday, September 3, 2026

AI Summary. Using American Community Survey data, the authors estimate that small minimum wage increases had no effect on employment while large increases had negative effects. Four years after the first increase, estimated employment effects approached −5pp for those aged 16–25 without a completed high school education and −3pp for all 16–21 year-olds.

Jeffrey Clemens and Michael Strain American Enterprise Institute
Date Posted:
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While a state-level event study finds no employment effect from small minimum-wage hikes, imputation DiD estimates show that four years after large hikes, employment is ~5pp lower for 16–25-year-olds without a HS degree and ~3pp lower for all 16–21-year-olds.

Do large minimum wage increases reduce employment while small ones do not?

Core argument: Four years after enactment of the first increase, large minimum wage increases are estimated to reduce employment by roughly 5pp among individuals aged 16–25 without a completed high school education and about 3pp among all individuals aged 16–21.

Figure 4 reports our imputation difference-in-differences estimates for the effects of small and large minimum wage changes on employment among individuals aged 16–21 and among individuals aged 16–25 with less than a completed high school education. The samples are from the ACS [American Community Survey]. [The data span 2011-2019]. We compare estimates for large versus small increases. The estimates to the left of the vertical dashed lines reveal no concerning evidence of divergent preexisting trends. We find null effects for the states that enacted small minimum wage increases and negative effects for states with large minimum wage increases. By 4 years after the enactment of the first increase, the estimate has approached −5pp for individuals aged 16–25 with less than a completed high school education, and −3pp for the sample of all individuals aged 16–21. [Editor's note: The authors note that Section VIII of the paper, which contains the Figure 4 imputation DiD estimates, “presents estimates from a modern difference-in-differences estimator that falls outside of our pre-analysis plan.”  The results are somewhat larger than those reported in the Abstract.]

Takeaways by Macro Roundup® AI

  1. Four years after enactment of the first increase, large minimum wage increases are estimated to reduce employment by roughly 5pp among individuals aged 16–25 without a completed high school education and about 3pp among all individuals aged 16–21.
  2. States enacting small minimum wage increases show null employment effects, while states with large increases show negative effects, based on imputation difference-in-differences estimates using American Community Survey data spanning 2011–2019.
  3. The estimates for periods before enactment reveal no concerning evidence of divergent preexisting trends.

Related Articles:

  • The Heterogeneous Effects of Large and Small Minimum Wage Changes on Hours Worked: Evidence Using a Partially Pre-committed Analysis Plan — The authors estimate that hours worked fall substantially more in response to large minimum wage increases than small ones, with large statutory increases associated with a differential decline of 0.73 hours on average. The declines are larger for 16–25 year-olds without a completed high school education (-0.94 hours) than for all 16–21 year-olds (-0.51 hours).
  • Did California’s Fast Food Minimum Wage Reduce Employment? — The authors estimate that California's $20 fast food minimum wage, up from $16, raised fast food sector wages roughly 8% relative to the rest of the country while employment fell about 2.7% relative to fast food employment elsewhere in the US. Their median estimate implies 18,000 fewer California fast food jobs than otherwise.
  • Minimum Wages and the Rise of the Robots — State-level measures of exposure to industrial robots show substantial geographic variation across the US, with the highest concentrations in the Southwest, Midwest, and Northwest and the lowest in the Mountain West, parts of the South, and northern regions. The authors find state robot exposure is positively correlated with state minimum wage increases.

AI Summary. Pension funds and insurers in Canada, Denmark, Australia, Taiwan, Japan and Finland hedged just 41% of their foreign-currency exposure, the lowest share since at least 2015. With some of the largest holders of US assets carrying little protection against a weaker dollar, the currency is at risk of steeper declines if sentiment turns.

Ruth Carson, Masaki Kondo, and Anya Andrianova Bloomberg
Date Posted:
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A Bloomberg analysis finds only 41% of global investors’ foreign-currency exposure is hedged in six major markets, the lowest level since 2015. Foreigners now hold almost $40T of American assets.

Does low currency hedging by foreign investors leave the dollar vulnerable?

Core argument: Pension funds and insurers in Canada, Denmark, Australia, Taiwan, Japan and Finland hedged just 41% of their foreign-currency exposure as of June 30, the lowest share since at least 2015.

Sift through the filings of pension funds and insurers around the world and one thing stands out: some of the biggest holders of US assets have little protection against a weaker dollar, leaving the currency at risk of steeper declines if sentiment suddenly turns. Across markets [Canada, Denmark, Australia, Taiwan, Japan and Finland for which data is available] investors hedged just 41% of their foreign-currency exposure as of June 30 — the lowest since at least 2015. While not a complete picture, it offers a glimpse into how the sudden rush last year to hedge against dollar losses triggered by President Donald Trump’s global tariff rollout has faded as the US currency slowly stabilized.

Takeaways by Macro Roundup® AI

  1. Pension funds and insurers in Canada, Denmark, Australia, Taiwan, Japan and Finland hedged just 41% of their foreign-currency exposure as of June 30, the lowest share since at least 2015.
  2. Some of the biggest holders of US assets have little protection against a weaker dollar, leaving the currency at risk of steeper declines if sentiment suddenly turns.
  3. The rush to hedge against dollar losses triggered by President Donald Trump's global tariff rollout has faded as the US currency slowly stabilized.

Related Articles:

  • Financial Innovation and the International Monetary System — The dollar accounts for 59% of cross-border payments messaged through SWIFT, far ahead of the euro's 14%, and its share of foreign exchange turnover has risen gradually to about 90% of the 200% total since 2010. Official holdings of U.S. Treasuries have leveled off near $4tn while foreign private holdings rose from $1tn to over $5tn.
  • The Global Balance Sheet 2026: Imbalance And Divergence — Only 20% of global household wealth growth came from net new investment in real assets such as machinery, housing, infrastructure and intellectual property, down from a 30% average over the prior quarter century. Nearly 60% came from asset prices rising faster than inflation and negative net worth in other sectors.
  • Momentum, Rotation and the Value in Growth — After a fifteen-year stretch in which US equities, technology and growth stocks led, equity gains have broadened geographically, with the US the weakest of the major regions. The five largest US stocks now trade at a price-to-earnings ratio only marginally above the other 495, after holding a consistent premium since 2017.

AI Summary. An analysis of Epoch's Capabilities Index data, controlling for developer and model family, finds no statistically significant breakpoint in AI progress; a segmented model fits no better than a straight-line trend (p = 0.615), with the estimated slope change ranging from -8.4 to +23.4 points per year.

Paul Kedrosky Applied Complexity
Date Posted:
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Kedrosky argues AI capabilities continue to improve, but “the full composite data shows flattening relative gains, not acceleration…rolling relative model gains have fallen from their 2024 peak, while model dispersion has narrowed sharply.”

Has AI capability progress accelerated beyond its linear trend?

Core argument: Using all observations from Epoch's Capabilities Index and controlling for developer and model family, a piecewise model shows no statistically significant breakpoint in AI capability trends (p = 0.615) and does not improve on a purely linear trend.

Using all Epoch’s Capabilities Index observations, and controlling for developer and model family, there is no statistically significant breakpoint. A piecewise model—which splits the series into intervals and applies a sub-function to each segment—does not improve on a purely linear trend: p = 0.615, The estimated change in slope has a confidence interval of -8.4 to +23.4 points per year. In short, the maths shows there is no model acceleration, contrary to claims, and as expected. The result comes from selecting frontier observations only, choosing a breakpoint, ignoring variance collapse, and fitting separate lines on either side.

Takeaways by Macro Roundup® AI

  1. Using all observations from Epoch's Capabilities Index and controlling for developer and model family, a piecewise model shows no statistically significant breakpoint in AI capability trends (p = 0.615) and does not improve on a purely linear trend.
  2. The estimated change in slope of the AI capabilities trend carries a confidence interval of -8.4 to +23.4 points per year.
  3. Apparent AI acceleration results from selecting frontier observations only, choosing a breakpoint, ignoring variance collapse, and fitting separate lines on either side of that breakpoint.

Related Articles:

  • Why .400 Hitters Disappeared — and What It Means for AI — Artificial intelligence models' capability gains are shrinking in percentage terms, falling from about 15% relative to the baseline early on to roughly 10% for the same absolute increment, narrowing the gap between frontier and good-enough models. The author argues this points to a commoditizing market where price, not minor model differences, becomes the main differentiator, pressuring frontier firms' margins.
  • Chart of the Day: Small Models are Closing the Gap to Frontier AI — Achieving 60% on MMLU, a test of academic reasoning, once required a 540bn-parameter model but was reached by a 3.8bn-parameter model two years later, a 142x reduction in parameters. Models small enough to run on phones or sensors shift inference from data centers to devices, weakening the case for paying cloud providers per token.
  • Anthropic’s Best AI Model Struggles To Attract Users As Cheaper Tools Thrive — Spending on Anthropic's largest and priciest AI model has plateaued at about 11% of total outlay on the company's tools, according to payments data from 70,000 companies, breaking a pattern of corporate users defaulting to the most powerful models. Analysts and investors cite its high price and older models' adequacy.

AI Summary. Wholesale diesel prices in New York harbour rose almost 7% to $4.71 a gallon following US air strikes on Iran, a surge expected to raise consumer costs because diesel powers American industry and agriculture. The US president summoned refiners including Marathon Petroleum, Phillips 66, Chevron and Valero Energy to press them to curb fuel price inflation.

Stephanie Findlay, Claire Jones and Jamie Smyth Financial Times
Date Posted:

Wholesale diesel for sale in New York harbor has risen ~7% to $4.71, largely reflecting a record-high “crack” spread, the premium of diesel over crude. US refinery utilisation had been at or above 95% for 12 consecutive weeks, the longest streak since 2000.

Do military strikes abroad push domestic diesel prices higher?

Core argument: Wholesale diesel in New York harbour jumped almost 7% to $4.71 a gallon after President Donald Trump ordered extensive air strikes on Iran.

Wholesale diesel for sale in New York harbour jumped almost 7% to $4.71 a gallon after the US president ordered extensive air strikes on Iran. Diesel powers American industry and agriculture and the wholesale contract’s price surge will translate into higher consumer costs just months ahead of congressional elections. Trump on Tuesday held talks with industry in the White House to press them to beat back the fuel price inflation. Marathon Petroleum, Phillips 66, Chevron, Delek US Holdings, PBF Energy and Valero Energy were among the companies summoned to Washington, according to people with knowledge of the event.

Takeaways by Macro Roundup® AI

  1. Wholesale diesel in New York harbour jumped almost 7% to $4.71 a gallon after President Donald Trump ordered extensive air strikes on Iran.
  2. Diesel powers American industry and agriculture, and the wholesale contract's price surge will translate into higher consumer costs months ahead of congressional elections.
  3. Trump summoned refiners including Marathon Petroleum, Phillips 66, Chevron, Delek US Holdings, PBF Energy and Valero Energy to the White House to press them to beat back fuel price inflation, according to people with knowledge of the event.

Related Articles:

  • U.S. Economy Less Vulnerable To Geopolitical Oil Price Shocks Than In The Past — The United States became a net oil exporter in late 2019, and oil and oil product spending fell from near 8% of GDP in 1980 to 3% in 2024. The authors estimate a 15% global oil supply disruption would now cut annualized U.S. real GDP growth by 0.3pp, versus 1.7pp in the rest of the world.
  • 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.
  • U.S. Crude Oil Production Rose In 2025, Setting New Record — U.S. crude oil production rose 3%, or 350,000 barrels per day, to an annual record of 13.6m barrels per day, with the Lower 48 states excluding the Gulf accounting for 83% of output. Active rigs fell 5% and wells drilled fell 1% as West Texas Intermediate prices dropped from $77 to $65 a barrel, but efficiency gains still lifted production.

Friday, September 4, 2026

AI Summary. Net US investment has fallen from roughly 40% of gross investment in the 1970s to about 25% in the past decade, meaning about three-quarters of gross investment now just replaces depreciating capital. The author attributes this gap to modern investment being more information-technology-related, which depreciates faster and requires more frequent replacement.

Timothy Taylor Conversable Economist
Date Posted:
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U.S. real net private domestic investment—which adds to the American capital stock—is now only ~25% as large as gross investment, down from ~40% in the 1970s. Taylor suggests the widening gap between gross and net investment reflects the relatively rapid depreciation of IT-related capital.

Why does less of US gross investment add net capital?

Core argument: US net investment has run at about 25% of gross investment over the past decade, down from roughly 40% in the 1970s, meaning about three-quarters of gross investment merely replaces depreciated capital.

The figure divides net investment by gross investment. Back in the 1970s, net investment was often around 40% of gross investment, but the share has been slumping over time. For the last decade or so, net investment has been about 25% of the gross–that is, about three-quarters of gross investment is just making up for depreciation of the pre-existing capital stock. The likely reason for the growing gap between gross and net investment is that modern investment is more likely to be related to information technology [which] depreciates more rapidly and thus needs to be replaced and updated more often. If we want the average US worker to be using a greater amount of capital on the job–which was one of the key drivers of rising labor productivity in the past–it now takes a bigger rise in gross investment to lead to a given rise in net investment.

Takeaways by Macro Roundup® AI

  1. US net investment has run at about 25% of gross investment over the past decade, down from roughly 40% in the 1970s, meaning about three-quarters of gross investment merely replaces depreciated capital.
  2. The likely reason for the widening gap between gross and net US investment is that modern investment is more tied to information technology, which depreciates more rapidly and must be replaced and updated more often.
  3. Raising the capital used by the average US worker—a key driver of past labor productivity growth—now requires a larger rise in gross investment to achieve a given rise in net investment.

Related Articles:

  • US Stock Market To Stop Shrinking For First Time In 23 Years — Goldman Sachs estimates that net supply of US equity — new shares issued less shares removed by buybacks and take-privates — will be roughly flat in 2026 after being negative since 2003, with a larger influx expected in 2027 as lock-up periods on this year's initial public offerings expire.
  • Capital Is Making a Comeback — Tangible investment in property, factories and equipment fell from 12.5% to 8.5% of private gross domestic product, while intangible investment in intellectual property, software and process knowledge rose from about 11.5% to 16.75%. The author argues demand for tangible capital investment will now have to rise.
  • The Transition to a Higher Cost of Capital — Bond yields near 4.5% sit below the 5.5% short-term interest rate, leaving little risk premium, and those yields have been enough to draw buyers back toward normal bond holdings. The author argues yields still need to rise to a sustainable cost of capital given structurally higher fiscal and inflationary spending.

AI Summary. The U.S. college wage premium fell from 0.626 to 0.575 after four decades of expansion, implying the first sustained negative growth in relative demand for college-educated labor. The authors estimate that weaker wage growth in occupations highly exposed to artificial intelligence accounts for roughly 28% of that decline, though the patterns are not causal.

José Azar, Mireia Gine and Javier Sanz-Espín Social Science Research Network
Date Posted:
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The college wage premium flattened in the mid-2010s and has fallen ~8% since 2022. The authors argue that this compression reflects a broad decline in the returns to formal schooling, rather than a decline in the upper tail.

Is AI exposure driving the decline in the college wage premium?

Core argument: The U.S. college wage premium fell from 0.626 in 2022 to 0.575 in 2026 after expanding for four decades, with Current Population Survey data implying the first sustained negative relative demand growth for college labor.

After expanding for four decades, the U.S. college wage premium [dropped] sharply from 0.626 in 2022 to 0.575 in 2026. Current Population Survey data through 2026 implies an unprecedented drop in relative demand for college labor—the first sustained negative relative demand growth. Post-2022 wage growth slowed disproportionately in high-exposure occupations, which employ a disproportionate share of college graduates. By 2026, going from zero occupational AI exposure to full exposure had a negative effect on wages of−0.086. Combined with the college–non-college exposure gap, this mechanism accounts for roughly 28% of the total drop in the college wage premium from 2022 to 2026. While non-causal, these patterns indicate that task displacement in AI-exposed white-collar occupations plays a quantitatively meaningful role in the recent compression of the aggregate skill premium.

Takeaways by Macro Roundup® AI

  1. The U.S. college wage premium fell from 0.626 in 2022 to 0.575 in 2026 after expanding for four decades, with Current Population Survey data implying the first sustained negative relative demand growth for college labor.
  2. By 2026, moving from zero occupational AI exposure to full exposure had a -0.086 effect on wages, and combined with the college–non-college exposure gap this mechanism accounts for roughly 28% of the 2022–2026 drop in the college wage premium.
  3. Post-2022 wage growth slowed disproportionately in high-exposure occupations that employ a disproportionate share of college graduates, patterns that, while non-causal, indicate task displacement in AI-exposed white-collar occupations plays a quantitatively meaningful role in compressing the skill premium.

Related Articles:

  • Looking for the Ladder — The article argues that the hiring downturn in occupations most exposed to generative AI reflects interest-rate sensitivity rather than AI itself, since roughly 38% of workers in the most AI-exposed quintile work in information, finance and insurance, and professional and technical services, versus under 2% in the least-exposed quintile.
  • How Students and Recent Grads are Responding to the Rise of AI — Undergraduate enrollment in degrees tied to the most AI-exposed jobs has risen 8%, indicating students are moving toward rather than away from fields exposed to artificial intelligence. A decline in computer science degrees is more than offset by growth in other exposed fields such as engineering.
  • AI and Young-adult Jobs: The Real Mystery — Employment rates have declined for young adults both with and without college degrees, with non-degree holders faring marginally worse, and employment growth for young workers of all education levels has lagged that of other workers. Artificial intelligence can replace some lower-skilled jobs, but those jobs are too few to drive youth labor market weakness.

AI Summary. An analysis of millions of online job postings finds that openings fell for occupations whose tasks can be automated by generative artificial intelligence, with more-exposed firms advertising fewer such positions as a share of their total postings. Follow-up analyses suggest this shift in labor demand has negatively affected labor market outcomes for recent college graduates.

Samuel Dodini and Tucker Smith Federal Reserve Bank of Dallas
Date Posted:

A FRBD analysis of Lightcast (formerly Burning Glass) job postings data suggests AI-driven automation reduced job postings in Texas by ~1.8% in 2024 and ~2.6% in 2025, with recent college graduates most impacted.

Is AI automation reducing job openings for exposed occupations?

Core argument: An analysis of millions of online job postings finds that after ChatGPT's release in late 2022, Texas job openings fell for occupations whose tasks are automatable by generative AI.

A new analysis, using data from millions of online job postings, shows GenAI is reshaping labor demand in Texas. After the release of ChatGPT in late 2022, job openings fell for occupations whose tasks are automatable by GenAI. Indeed, more-exposed firms posted fewer automatable positions relative to their total ads after the release of ChatGPT. Follow-up analyses suggest this shift in demand has negatively affected the labor market outcomes of recent college graduates from Texas universities.

Takeaways by Macro Roundup® AI

  1. An analysis of millions of online job postings finds that after ChatGPT's release in late 2022, Texas job openings fell for occupations whose tasks are automatable by generative AI.
  2. Firms more exposed to generative AI posted fewer automatable positions as a share of their total job ads following ChatGPT's release, according to the analysis.
  3. Follow-up analyses suggest the shift in labor demand has negatively affected labor market outcomes for recent graduates of Texas universities.

Related Articles:

  • Canaries in the Coal Mine? Six Facts about the Recent Employment Effects of Artificial Intelligence — Employment for workers aged 22–25 in the occupations most exposed to artificial intelligence has declined roughly 18pp relative to less-exposed peers, with no comparable decline in other age groups. The authors find this operates mainly through reduced hiring, concentrated where AI substitutes for human tasks rather than complements them.
  • You’re (Not) Hired: Artificial Intelligence and Early Career Hiring In The Quarterly Workforce Indicators — Employment among workers aged 22–24 in the most artificial-intelligence-exposed quintile of industry-state employers fell 15.2%, while other exposure quintiles were flat or posted modest gains. The decline is not generally observed among older workers; the 25-34 group's drop was less than one-third as large in percentage terms.
  • The Impact of AI on the U.S. Labor Market — Using observed AI usage data across 321 U.S. occupations, the authors estimate that highly exposed occupations saw a 6.7% decline in real wage growth with no detectable employment effects. The estimated declines are concentrated among the lowest earners, with service workers down 24.3% and the bottom wage quartile down 10.7%, while top earners show no significant effect.

AI Summary. Wall Street banks are pressing large law firms to cut fees as artificial intelligence speeds up legal tasks, with Morgan Stanley's general counsel calling the billable-hour compensation model unstable and shifting most outside legal work to competitive bidding and fixed fees. He argues firms could stay as profitable by using AI to handle more matters at lower cost.

Kaye Wiggins and Joshua Franklin Financial Times
Date Posted:

AI is destabilizing the hourly-billing model of large law firms. Major banks are moving toward competitive bidding and fixed fees, expecting AI savings to lower legal costs, while firms preserve profits by handling more matters with fewer hours.

Is AI pushing law firms away from billable-hour pricing?

Core argument: Morgan Stanley general counsel Eric Grossman told the FT that law firm pay models built on associates billing long hours are "extraordinarily unstable," and that completing tasks more quickly could mark "a fundamental altering of the revenue foundation.".

Top lawyers have “for a long time been compensated on the foundation of [associates billing for long hours],” Eric Grossman, Morgan Stanley’s general counsel, told the FT. “Their compensation model is now extraordinarily unstable.” The ability to complete tasks more quickly could mark “a fundamental altering of the revenue foundation.” Grossman said the bank was willing to continue to pay large sums for the judgment and talent of the best lawyers, but that by the end of this year most external legal work would be tendered through competitive bidding processes and paid for using alternative arrangements such as fixed fees. That should cost the bank less, he said, but law firms could remain as profitable as before if they use AI to work on more matters and reduce costs.

Takeaways by Macro Roundup® AI

  1. Morgan Stanley general counsel Eric Grossman told the FT that law firm pay models built on associates billing long hours are "extraordinarily unstable," and that completing tasks more quickly could mark "a fundamental altering of the revenue foundation.".
  2. Grossman said Morgan Stanley would tender most external legal work through competitive bidding by the end of this year and pay via alternative arrangements such as fixed fees, which he said should cost the bank less.
  3. Grossman said law firms could remain as profitable as before by using AI to work on more matters and reduce costs, and that Morgan Stanley remains willing to pay large sums for the judgment and talent of the best lawyers.

Related Articles:

  • AI and Productivity — The recent pickup in US labor productivity appears driven by higher utilization of existing capital—running factories, server racks, and hotel rooms harder—rather than by firm-level efficiency gains from AI. Adoption remains too thin and the cross-sectional evidence too weak to conclude that AI-driven productivity gains are already widespread.
  • US Focus: The Effect Of Soaring Profits — US nominal pre-tax corporate profits in the national accounts grew 23% over the past year, a pace not seen outside post-recession spikes since the mid-2000s. Wider margins were the key driver, as domestic profit growth far exceeded the 8% rise in corporate value added, pushing margins near all-time highs while the labor share hit new lows.
  • Writing Code vs. Shipping Code: Productivity Effects Across Generations of AI Coding Tools — The authors estimate that AI coding tools raise developers' task-level productivity by about 40% with autocomplete, 140% including synchronous agents, and 180% with asynchronous agents, with larger effects for less active developers. Gains attenuate up the production chain: synchronous agents raise lines of code 741% and pull requests 65% but releases only 20%.

AI Summary. US diesel pump prices reached a record average of $5.85 a gallon, according to the American Automobile Association, surpassing the previous high. Harvest season demand, early winter heating needs, and planned US refinery maintenance are likely to squeeze diesel supplies further.

Malcolm Moore Financial Times
Date Posted:

US retail diesel prices have climbed to an all-time nominal high of $5.85 per gallon. The previous nominal high in January 2022 would be $6.54 in current dollars.

Are seasonal demand and refinery maintenance pushing diesel prices to records?

Core argument: US diesel pump prices averaged $5.85 a gallon for the first time on Friday, according to the American Automobile Association, eclipsing the previous record set after Russia's full-scale invasion of Ukraine in 2022.

[Diesel] pump prices hit an average of $5.85 a gallon for the first time ever on Friday, according to the American Automobile Association, eclipsing the previous record level that was reached in the aftermath of Russia’s full-scale invasion of Ukraine in 2022. From October, diesel is likely to be squeezed further by the harvest season, early winter heating demand and planned maintenance by US refineries. About three-quarters of diesel in the US is used for transportation and trucking goods, and the fuel is also essential for agriculture, powering much of the farm equipment used in the upcoming harvest season.

Takeaways by Macro Roundup® AI

  1. US diesel pump prices averaged $5.85 a gallon for the first time on Friday, according to the American Automobile Association, eclipsing the previous record set after Russia's full-scale invasion of Ukraine in 2022.
  2. From October, US diesel is likely to be squeezed further by harvest season, early winter heating demand and planned maintenance at US refineries.
  3. About three-quarters of US diesel is used for transportation and trucking goods, and the fuel also powers much of the farm equipment used in the harvest season.

Related Articles:

  • US Diesel Prices Soar As Donald Trump Hauls In Refiners — Wholesale diesel prices in New York harbour rose almost 7% to $4.71 a gallon following US air strikes on Iran, a surge expected to raise consumer costs because diesel powers American industry and agriculture. The US president summoned refiners including Marathon Petroleum, Phillips 66, Chevron and Valero Energy to press them to curb fuel price inflation.
  • U.S. Economy Less Vulnerable To Geopolitical Oil Price Shocks Than In The Past — The United States became a net oil exporter in late 2019, and oil and oil product spending fell from near 8% of GDP in 1980 to 3% in 2024. The authors estimate a 15% global oil supply disruption would now cut annualized U.S. real GDP growth by 0.3pp, versus 1.7pp in the rest of the world.
  • 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.