As the third quarter reached its end, the most recent short-term federal spending agreement (originally reached in March) expired, sending the government into shutdown mode once again. This closure marks the 11th such funding gap since 1980—when a legal opinion first began to require it—and the third since 2018. The…
The market's tariff tantrum
In the 2024 election campaign, President Trump ran on a wide-ranging platform that included promises of both increased tariffs and sweeping immigration reform. In the initial weeks of his term, action on both fronts was somewhat limited, and there was an expectation among most economists and analysts that his ultimate…
The long shadow of inflation
Heading into this past November’s presidential election, by most traditional metrics, the national economy was strong and thriving. GDP growth was positive, inflation was back down near the Fed’s long-term target, and strong consumer spending data had added fuel to a persistent stock market rally that continues to lead the…
Tax policy takes center stage
From an economic perspective, the impact of Presidential election outcomes tends to be greatly overstated. Chief executives do not actually exercise much direct control over economic policies, and even when they do, the stock market’s reactions are unpredictable. There is little compelling evidence that the economy (or the market) does…
The labor market's slow recovery
Our most recent quarterly newsletter included a short item discussing the persistent tightness in the labor market, and its ongoing impact on inflation and economic growth. It’s a dynamic that we’ve been tracking for some time now, and it’s an issue that remains as relevant as ever as we head…
Labor market tightness remains
The persistent inflation that has plagued the global economy over the last two years has had multiple causes and phases. First, as COVID lockdowns were lifted, jammed-up shipping ports led to a frozen supply chain, which made many products scarce and essentially unavailable. Those supply chain concerns have now largely…
When will inflation peak?
The story of the market year so far in 2022 has been persistent inflation, and its impact on Fed interest rate policy. The Consumer Price Index (CPI) increased by 8.6% in May on a year-over-year basis, the highest recorded figure in more than 40 years. Increases in the price of…
