CERF Blog

Today’s news will be dominated by the BLS’s unemployment data release. I’m sure we’ll have more to say on that. Right now, I’d like to discuss a less-publicized data release, one that probably has more information than the unemployment data. Yesterday, the FDIC released bank charge-off data, and it was disappointing and scary. I’ve posted… Read more

Mark Zandi declared “the recession is over” on Tuesday September 1, 2009. All of the economists at CERF would like this to be true. However, we suspect that this is not true. Mark’s declaration was based in part on the ISM manufacturing activity index data release. The economy has benefited from expenditures on vehicles in… Read more

Over the weekend I read this article. It seems that Barney Frank and Ron Paul, normally not allies, have gotten together and proposed a law requiring an audit of the Federal Reserve System and limiting the Fed’s lending options. I tweeted on it, calling it a really really bad idea. I was tempted to say… Read more

Kurgman has had several recent blog entries and an op-ed ( http://tiny.cc/7S3of ) on the virtues of government debt. He compares the current stimulus to that of the 1930’s, WWII, and the Cold War. He provides the “comforting” statistic that we had government debt of 109% of GDP at the end of WWII. He argues… Read more

The current economic downturn is a serious one, especially for coastal California counties. Los Angeles County also experienced a serious and prolonged recession in the early 1990s. The early 1990s United States economy experienced a cyclical economic downturn while Los Angeles County also experienced a major downsizing of its aerospace and defense industries. The contraction of… Read more

In November of 2008, we substantially revised our forecast of mid-year 2009 California year-on-year job growth from a fall of about one percent to a fall of about five percent. At the time, we felt like we were in the midst of a regime-shift to a different state of economic affairs. This new state was… Read more

The Employment Development Department’s July 2009 Ventura County jobs report, released Friday, is depressing. From the household survey we see that the seasonally unadjusted unemployment rate rose from June’s 10.3 percent to 10.9 percent in July. However, Ventura County’s July seasonally unadjusted unemployment rate usually increases in the summer, due to school closures. Another way… Read more

The Pacific Research Institute released a new study yesterday. The report, titled “Assessing the State of the Golden State,” analyzes indicators for income, labor, migration, and entrepreneurship and compares California to every other state. Here’s a link to the report: http://tiny.cc/huFh5 How does California rank in this study? The short answer is poor. By these… Read more

This is a slow week for economic news. I was thinking about how different things are from last August. Last year we were approaching the most serious economic crisis of our life. Economic storm clouds were building, the government was bailing out firms, and everyone was preparing for the worst. Except, September was worse than… Read more

Two Los Angeles Times articles today highlight California’s problems. One article discusses the falloff of activity at the Los Angeles and Long Beach ports (http://tiny.cc/eFHbx). The other discusses the expected closing of California’s last auto plant (http://tiny.cc/ini6Z). Some would argue that these events reflect the worldwide economic decline and have little to do with California.… Read more

Most people are concerned about potential inflation, but deflation is the immediate worry. It is easy to see why the concern for inflation. Big deficits and big increases in the monetary base usually lead to inflation. However, inflation is not inevitable. For inflation to occur, increases in the monetary base have to be translated to… Read more

One last comment on the Bureau of Labor Statistics’ (BLS) employment and unemployment data release on Friday, I promise. I haven’t seen any comments on the “Long Term Unemployed.” These are people who have been unemployed for more than 27 weeks. According to the release, there were just under 5 million people (4,934,000) who had… Read more

The markets are reacting enthusiastically to today’s jobs and unemployment data. I’m not sure why. Dan discussed the jobs data and the problems with seasonal adjustment in the previous post. There is also a problem in the unemployment data.

Most data releases are of seasonally adjusted data, and that is a problem. No one knows what the exact seasonal patterns in the economy are. We estimate them. The new jobs data release is an example of the problem. Today’s Bureau of Labor Statistics release of the July employment situation report shows 247 thousand seasonally-… Read more

I always figured that the administration would take credit for any eventual economic recovery, but I also figured that they would wait for the recovery. Wrong. Cristina Romer, perhaps buoyed by yesterday’s GDP release and today’s job data, says that the stimulus is working.