As a share of global economic output, manufacturing has dropped from 19% in 1997 to 16% today, with the fall steepest in rich countries. In China and India industry’s share of economic output appears to be roughly where it was three decades ago, but even in these countries, it has slipped in recent years. In recent decades there has been next to no relationship between economic growth and manufacturing’s share of the economy among countries in the OECD. Related: Why Laws Meant To Create Jobs Can Be So Destructive For Our Cities and New York State Built Elon Musk a $1 Billion Factory. ‘It Was a Bad Deal.’
- Date Posted:
- July 12, 2023
The headline is CPI inflation fell to 3.0%. But mostly this is the huge June 2022 # dropping out & what is almost certainly a transitory 17% fall in energy prices over the last yr. But underneath the #s show moderation, with the lowest core reading of the inflationary period. Overall what is happening is that service price growth is gradually slowing--as was predictable and predicted given the lags in the shelter measure. And goods price growth which was unusually (and likely transitorily) high in recent months turned back down again. The collapsing of "supercore," which excludes food, energy, shelter, and used cars (the narrowest category BLS publishes) is even more dramatic. Overall, core PCE inflation is still running well above Fed's target. Economy is very strong. Interest rates are not that high & most of the relevant increases happened a while ago. The banking sector stabilized. Fiscal policy may be mildly expansionary. Fed should still do more.