After the Fall
Carmen M. Reinhart and Vincent R. Reinhart/working paper presented at Kansas City Fed conference
“Real per capita GDP growth rates are significantly lower during the decade following severe financial crises and the synchronous world-wide shocks. The median post-financial crisis GDP growth decline in advanced economies is about 1 percent.”
Hiring, Manufacturing Probably Cooled on Signs U.S. Recovery Is Stumbling
Shobhana Chandra/Bloomberg
“Hiring and manufacturing probably cooled in August, showing companies are scaling back as the U.S. recovery shows signs of stumbling, economists said before reports this week.”

The Emerging Markets’ Century
Desmond Lachman/The American (Journal of the American Enterprise Institute)
“A profound, yet little noted, change is occurring in the global economy. It is the relative strengthening of the public finances of the major emerging market economies compared to the crumbling public finances of industrialized countries. This change will likely accelerate the tendency already very much in evidence in recent years for the emerging market countries to gain relative importance in the global economy. It is also likely to carry with it profound political implications for international relations between those countries and those in the G-7.”
The Bubble That Isn’t
Daniel Gross/Slate
“Don’t worry about a bubble in U.S. government bonds”
We’re Not Going to Double Dip
Donald Luskin/Smart Money
“…I remain convinced we’re not in a double-dip recession, and I think stocks should be accumulated at these levels.”
The Yield Spread and the Odds of Recession
Donald Marron/
“…the relative steepness of today’s yield curve (10-year rate about 2.5 percentage points above the fed funds rate) thus suggests, by itself, that renewed recession is unlikely, despite recent weak economic data. On the other hand, there are reasons to believe that this time things are different (usually a scary phrase). After all, fed funds rate has been pushed down almost to zero and yet the economy no longer appears to be responding. That’s exactly the logic that inspired the SF Fed researchers to try their model without the yield spread.”
U.S. Equities: Scaling Back On Risk
BCA Research
“We have been overweight risk assets relative to Treasurys and cash since early 2009, but it is time to take profits and scale back on risk exposure. We recommend cutting equity and corporate bond allocation to neutral and placing the proceeds in Treasurys. We view this as a tactical shift. We have not abandoned our view that the economic recovery will ultimately be sustained, although growth will be tepid by the standards of past recoveries that followed deep recessions.”
Preparing For The Next Black Swan Is Tough
Robert Lenzner/Forbes
“Don’t expect your favorite economist to predict the next Black Swan. Economists are a “black swan blind species,” charges Nassim Nicholas Taleb in the expanded second edition of The Black Swan: Second Edition: The Impact of the Highly Improbable.