• gaspumps

    Energy Expenditures

    With the recent sharp decline in energy prices, the percentage of household spending devoted to energy in Q4/14 was 4.9%, its lowest level since Q1/09. The last time it was below 5% for an entire year was 2003. The lowest quarterly percentage this century was 3.97% in Q1/02, while the highest was … [Read More...]

  • dollarstacks

    Burgeoning Buck

    While the strength of the US dollar was for a long time the result of central bank policy in the US, the dollar is now, to at least some extent, a determinant of Fed policy. Because the surging dollar is dampening inflation, hurting exports, lowering corporate profits, and will probably harm … [Read More...]

  • povertywithkid

    Parental Poverty

    The Friday File: The cost of raising a child from birth to college is $245,340, or $13,630/year for families with annual incomes of $82,790. Of course this excludes college costs and forgone income while being a stay-at-home parent. Conservatively those two items sum to over $150,000, bringing the … [Read More...]

  • ProductivityProblem

    Productivity Problem

    While 3.2 million new jobs were created in 2014 making it a great year for job creation, GDP grew by a very pedestrian 2.4%. This suggests that labor productivity is either growing very slowly, or worse, may be declining. Either way, it means when labor force slack disappears inflation pressures may … [Read More...]

  • balanced-budget

    Budget Balance

    In calendar year 2014, the budget deficit was $488 billion, $72 billion less than in 2013 and the smallest deficit since 2007. Since the start of 2010, revenues have risen from $2 trillion to $3 trillion, while spending has been flat at $3.5 trillion. If revenues continue rising by $200 … [Read More...]

Mar
27

Skipping School

skippingschool

The Friday File: While school closures for bad weather may hurt student achievement, absenteeism profoundly hurts achievement. Each one-day increase in absenteeism lowers math scores by 5% of a standard deviation! Schools deal with school-wide closures by adding days or speeding up the curriculum, … [Read more...]

Mar
26

Garbled Growth

slow2

On the plus side, job growth continues to look very strong and inflation rates appear to be no longer falling. But business investment has been declining for six months and retail sales have been slumping for three. This suggests a resilient and strengthening economy but one that is temporarily … [Read more...]

Mar
25

Auto Advance

driver

After peaking at 3.03 trillion vehicle miles travelled (VMT) during the 12 months ending 11/2007, VMT hit a cyclical low of 2.94 trillion miles during the 12 months ending 11/2011. Finally, VMT hit a record 3.05 trillion during the 12 months ending 1/2015, taking 85 months to surpass the previous … [Read more...]

Mar
24

Mediocre Moving

moving1

The number of Americans who moved in 2013 was 35.7 million, 11.5% of the population. Since record keeping began in 1948, the percentage of movers has steadily declined from about 20% to just 11.5% today. However, because of population growth due to the Boomers, the number of movers steadily rose … [Read more...]

Mar
23

Collecting Crude

bakken

US crude oil inventories are at 29 days, their highest level since 1985, and are at 60% of storage capacity vs. 48% a year ago. In Cushing, OK (the delivery point for WTI futures contracts) inventories are at 77% of capacity at 54.4 million barrels. That was 100% of capacity as recently as 2011, but … [Read more...]

Mar
20

Hot Haul

Gardner Theft

The Friday File: 25 years ago Wednesday, $500 million in paintings were stolen from the Gardner Museum in Boston, making it the greatest art heist. Other spectacular ones include the pilfering of the Mona Lisa from the Louvre in 1911 (recovered in 1913) and the purloining of Munch’s The Scream in … [Read more...]

Mar
19

Energy Expenditures

gaspumps

With the recent sharp decline in energy prices, the percentage of household spending devoted to energy in Q4/14 was 4.9%, its lowest level since Q1/09. The last time it was below 5% for an entire year was 2003. The lowest quarterly percentage this century was 3.97% in Q1/02, while the highest was … [Read more...]

Mar
18

Backtracking Bank

yellen

In today’s press conference Fed Chairwoman Yellen told us the Fed might raise rates as soon as June, but then quickly backtracked playing the markets masterfully. She cited the strengthening dollar as hurting manufacturing and weakening inflationary trends. Moreover, while the Fed expects the … [Read more...]

Mar
17

Halting Housing

Bldg permit

While housing starts were positively rotten last month, weather was a key factor. That said, permits are much less weather sensitive than starts, with a very small margin of error. While overall permits were up 4%, single-family permit activity was down 6.2% and is at its lowest level since 5/14. … [Read more...]

Mar
16

Burgeoning Buck

dollarstacks

While the strength of the US dollar was for a long time the result of central bank policy in the US, the dollar is now, to at least some extent, a determinant of Fed policy. Because the surging dollar is dampening inflation, hurting exports, lowering corporate profits, and will probably harm … [Read more...]