CERF Blog

The BEA’s second estimate of total United States Economic activity, just out today, is 2.8 percent. This is down 70 basis points from the “advance” estimate published a month ago. The change in the estimate was driven mainly by upward revisions to imports and downward revisions to personal consumption expenditures and to nonresidential fixed investment… Read more

The Gartner Group released a new outlook report for the global semiconductor industry yesterday, November 16th. There is a bit of optimism in this report! The group has raised their forecast for 2009 based on recent data. This is the second time the group has raised their forecast in less than three months. From their… Read more

The Association of American Railroads released its Rail Time Indicators report last Wednesday. October United States rail carloads were down 15.3 percent from October 2008 while intermodal traffic was down 11.2 percent. For the first ten months of 2009, rail carloads were down 17.9 percent while intermodal traffic was down 16.2 percent. Canadian carloads and… Read more

After the kids went to bed last night, I checked the web to see if there was anything new. The Wall Street Journal posts the next day’s op-eds the evening before print publication. So, I checked those out. I started reading a piece by Judy Shelton provocatively titled The Fed’s Woody Allen Policy. Hey, I… Read more

Japan stepped up their purchases of United States Treasuries during October to $105 billion dollars, boosting their total holdings of United States Treasury Issues to $731 billion, more than 10 percent of the total market. Japan and China are typically the largest purchasers, by far, of United States Treasuries. Why do we care about this?… Read more

The United States unemployment rate rose from 9.8 percent in September to 10.2 percent in October, exceeding our forecast and the consensus forecast. We appear to be in-between everyone else and reality again. The data, either quarter-on-quarter or year-on-year, indicate ongoing job losses that are typical for a serious recession. We have said in the… Read more

The Mysterious Effective Demand tweeted and blogged on a paper by University of Arizona Professor Brent T. White. I haven’t read the full paper, but the portion quoted by Effective Demand presents a pretty simple and predictable argument that “Millions of American homeowners are “underwater” on their mortgages – owing more than the value of… Read more

Carry trade is the name of the strategy of going short in a low-interest rate currency such as the Japanese Yen or the U.S. dollar while going long in a high-interest rate currency such as the New Zealand dollar. Commentary about the carry trade has reached a high pitch. Professor Roubini asserts that it will… Read more

Recent United States economic indicators have provided mixed signals. Measures of GDP, industrial production, factory orders, and trade have been encouraging while homeownership rates, foreclosure rates, and bank charge-offs still remain discouragingly high. A manufacturing rebound would be a welcome boost to the still-ailing United States and World economies. However, the ongoing weaknesses in housing… Read more

I ran across the “Distress Index” today. It’s put out by the Foundation for Economic Education, an outfit I’ve never heard of before. They even have a nice chart showing how their index has performed over time. I’m not a fan of indices. (Indices is preferred over indexes. Indexes proper usage is as a verb,… Read more

The United States government reported that real Gross Domestic Product increased at a seasonally adjusted annualized rate of 3.5 percent in the third quarter. Improvements in Consumer Durables consumption, up 22.3 percent, and Residential Fixed Investment, up 23.4 percent, were the key components driving the increase. Both of these gains were in turn driven by… Read more

This recession and its accompanying financial crises started with large financial institutions making headlines with bad loans, liquidity problems, and in many cases insolvency. The driving factors at that point were the toxic residential-real-estate-based securities filtering their way through the financial system. Many large financial institutions were highly exposed to securitized packages of residential mortgages… Read more

Reuters has a release of new housing data. Seems sales fell in September and Augusts’ numbers were revised down. I’m amazed at the writer’s confidence that we are in “widening recovery.” The money quotes are “The housing data represented a road bump in a recovery that otherwise appears to be widening.” & “With some lingering… Read more

A couple of months ago, on a flight from Los Angeles to New York, I had the opportunity to sit next to an impressive young woman from New Zealand, and we had the type of conversations that occur on long flights. New Zealand was too small for her, and opportunity was limited. So, right after… Read more

I was reviewing new data from DataQuick Information Systems. There were 111,689 California Notices of Default (NODs) during the third quarter. While this is down from 124,562 in the second quarter, it is still an enormous number, see the chart below. Foreclosures rose from 45,667 to 50,013. There is massive heterogeneity across the state with… Read more