Tag Archives: gdp growth

Bullard/Fed

Posted on by


Karim writes:

Bullard

  • Definitely out there on his own. FRB would certainly not communicate policy shift through him
    • Also, everyone has different reasons why QE works. Most of the Fed leadership thinks just via interest rate channel and announcement effect. Bullard thinks through monetary channel, which makes him a minority.

GDP Data: Something for everyone; capex recovery intact; consumer spending sluggish; net exports a large drag; inventories an offset

  • Annualized gwth at 2.4%; Q1 revised from 2.7% to 3.7%; Prior data revised lower
  • Private consumption 1.6% vs 1.9% in Q1; Investment up 28.8% vs 29.1% in Q1
  • Business capex (equipment and software spending) up 21.9% vs 20.4% in Q1
  • Residential fixed investment (housing) up 21.9% (aided by expiring tax credit)
  • Exports and imports both up in double digits, but net exports a drag on growth of -2.78%
  • Inventories contribute 1.05%

Share

1934 Cartoon

Posted on by

We went off the gold standard in 1934 and solvency was never again an issue for the Federal government.

Those ‘sound money’ people were wrong then and are wrong now as taxes function to regulate aggregate demand and not to raise revenue per se.

This cartoon is claimed to be from the Chicago Tribune in 1934. Look carefully at the plan of action in the lower left corner.

Share