Potential Output: Little Explanation for a Big Number
Commentary about the Biden administration’s proposed fiscal relief policies has relied heavily on estimates of the economy’s potential output. However, few commentators or policymakers look under the hood to check how these estimates are calculated.
Inflation: The Good, The Bad, and The Transitory
The Framework Review and Forward Guidance center labor market outcomes over inflation in evaluating interest rate policy. However, the Fed haven't clarified how they will evaluate inflationary dynamics under the new regime.
The Faulty Assumptions Behind the CBO’s Enhanced Unemployment Multiplier
The nonpartisan Congressional Budget Office’s analysis of the macroeconomic impacts of the Enhanced Unemployment Insurance (EUI) provisions of the CARES Act is deeply flawed.
Secretary Mnuchin Shifting Funds From Its $500B ESF Appropriation Into The Treasury’s General Fund Likely Violates The CARES Act
Given Mnuchin’s stated intent to act in violation of the CARES Act, Chair Powell should reconsider his decision to transfer the funds back to Treasury, or at least clarify that they are for the sole purpose of being returned to the Exchange Stabilization Fund.
The Shock and The Slog
While The Shock may have ended, labor market indicators suggest that we still need to respond appropriately to The Slog if we are to avoid a repeat of the lackluster “jobless recovery” following the 2008 crisis.
