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
  • “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 very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “Unintended Consequences represents the most cogent and persuasive analysis of the Financial Crisis to date.” - Andrei Shleifer, 1999 John Bates Clark Medal Winner
  • “…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
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “A full-throated defense of economic dynamism.” - The Wall Street Journal
  • “…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
  • “…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
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
Upside of Inequality Oxford Unintended Consequences

AI Summary. Underlying inflation is running about 1–1.5 percentage points faster than normal, driven by both services and goods, with goods inflation accelerating while services inflation slows, partly an illusion tied to healthcare measurement. Income growth is slowing but remains persistently faster than pre-pandemic, consistent with modestly above-target inflation.

Matt Klein The Overshoot
Date Posted:

Wages are growing at a 4.2% annual rate, well above the pre-pandemic level of 2.9%, consistent with inflation running “about 1-1.5 percentage points faster than normal.” @M_C_Klein

Is underlying inflation still running faster than normal?

Core argument: Underlying U.S. inflation is running roughly 1–1.5 percentage points faster than normal, reflecting excessive inflation in both supercore services and goods.

Underlying inflation is still running about 1-1.5 percentage points faster than normal, thanks both to excessive inflation in supercore services and goods. Goods inflation had been accelerating, while services inflation had been slowing, although that is partly an illusion thanks to issues with healthcare inflation. Income growth is slowing somewhat, but is still persistently faster than pre-pandemic, consistent with the modestly faster-than-target inflation. Job churn has stabilized below where it was before the pandemic, consistent with the collapse in relative wage gains for job-switchers over job-seekers, but there is still a large gap between actual labor churn and what would be expected based on the pace of wage growth.

Takeaways by Macro Roundup® AI

  1. Underlying U.S. inflation is running roughly 1–1.5 percentage points faster than normal, reflecting excessive inflation in both supercore services and goods.
  2. Goods inflation had been accelerating while services inflation had been slowing, though the services slowdown is partly an illusion stemming from issues with healthcare inflation.
  3. Job churn has stabilized below its pre-pandemic level, consistent with the collapse in relative wage gains for job-switchers over job-seekers, yet a large gap remains between actual churn and what the pace of wage growth would imply.

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  • Consumer Sentiment Deteriorating Rapidly — University of Michigan survey data show consumer sentiment declining for households earning both above and below $100,000, with job-loss worries at levels typically seen in recessions and a record-high share of consumers saying business conditions are worsening. Income expectations are falling while inflation expectations are rising rapidly.
  • The Richest Americans Kept the Economy Booming. What Happens When They Stop Spending? — The authors of an Institute for New Economic Thinking paper estimate that wealth gains among the top 10% of US households were large enough to explain the rise in total consumer spending above its longer-term trend, sustaining their spending even as their inflation-adjusted incomes shrank.
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