Non-Accurate Ideology Rendered Useless – NAIRU

Today’s payroll data is yet another punch in the gut to those arguing for a sharp rise in inflation pressures. Wage growth came in 0.1% below consensus at the same time payroll growth beat expectations handsomely. The rise in the participation rate, and the...

Fade Trade & Fade Angie

Last week was yet another lesson in trade fading. Threats of US tariff increases on $200b of Chinese goods, along with a proposed 20% tariff on car imports from Europe, caused the markets to wobble for a few hours. Then of course the perfunctory fading began. I’m not...

A whole lotta nothing…

I would characterize todays’s FOMC announcement as essentially meeting slightly hawkish expectations. Here is what we learned: No changes to estimates of the NAIRU or r-star. There were some very small tweaks to the path by which we get to equilibrium though. And with...

What will the FOMC do this afternoon?

Will they lower their estimate of the NAIRU? Will they raise their estimate of r-star? Will they drop the following two lines from the statement: “The federal funds rate is likely to remain, for some time, below levels that are expected to prevail in the longer run”...

Goldilocks just keeps kicking the Phillips Curvers in the teeth

Last week the unemployment rate hit a cycle low of 3.8%, a level that was last seen in April 2000, at the very end of the Goldilocks era. Prior to that you would have to go all the way back to the “golden age” of the late 1960s in order to find rates this low....
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