Ethan Harris
Ethan Harris
believe chronic economists employment finally hope improvement month overall past reason relative stage tendency three
At every stage in the past three years, employment has disappointed relative to overall activity. It's a chronic issue, and there's been a tendency for economists to hope this will finally be the month when improvement occurs. But I have no reason to believe it will.
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You don't want to force the new chairman to open his term by having to make a a 50 basis point rate hike.
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There's a chronic risk to the bond market from global economic recovery. Probably the most potent story is Japan.
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It suggests moderate growth in the year ahead, but I don't think there's much risk of a 'double-dip' recession.
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It's true there's been a shift of income distribution, with a lot of income gains accruing to upper income individuals. The labor market is paying a bigger and bigger premium for being well educated, ... At the other end of the distribution, if you look at Joe Six-Pack, you've seen a big decline in big paying, low skill jobs in manufacturing.
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The number itself wasn't very surprising, ... (Federal Reserve Chairman Alan) Greenspan's comments last week that the trade gap might start getting smaller raised attention and some hopes. But I didn't agree with him about that.
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It's the toughest weight class in the state, by far. Everyone here is so tough. There are just some studs in this weight class, so it's going to be the best man who comes through with the title.
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This large inflow is an important prop for the Treasury market, helping keep yields in their current low trading range. Not only is the inflow large relative to new Treasury supply, it may also help stabilize the market when it comes under pressure. If investors start to shy away from the U.S. market, the dollar comes under downward pressure and the Asian central banks pile in to support the U.S. market.
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This kind of adds to the sense of a rookie in the institution. They are going to have to learn the ropes for a while before they are going to be influential.
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This is why people talk about radical moves down in the dollar. They just can't see an improvement of the trade balance happening any other way.
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They're adding to the intellectual firepower of the board of governors in terms of regulatory and financial markets issues, but initially they won't be important players in the monetary policy front.
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There's definitely going to be nervousness around the event and a kind of inertia. My wife has already asked me not to come into work that day.
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Even with this dip, the unemployment rate is still about a percentage point above the level where it might threaten inflation. That means there's plenty of wiggle room for the Fed on policy. They're going to be patient and not change the wording of their statement next week.
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Even with a resolution to the situation in Iraq, the economy will still be suffering from some fairly significant headwinds.