US Economy http://www.globalpost.com/taxonomy/term/20552/all en Federal Reserve leaves US rates unchanged http://www.globalpost.com/dispatches/globalpost-blogs/macro/federal-reserve-leaves-us-rates-unchanged <div class="field field-type-text field-field-subhead"> <div class="field-items"> <div class="field-item odd"> Will they? Won't they? They won't. </div> </div> </div> <div class="field field-type-text field-field-byline1"> <div class="field-items"> <div class="field-item odd"> Thomas Mucha </div> </div> </div> <!--paging_filter--><p> Forget Europe&#39;s pending euro meltdown, China&#39;s manufacturing slowdown and the general economic unease spreading across most of planet Earth.</p> <p> It appears that the US economy is doing just fine.&nbsp;</p> <p> That&#39;s the signal, anyway, from the US Federal Reserve, which today decided against cutting interest rates or doing much else to stimulate the US economy.&nbsp;</p> <p> The nation&#39;s employment and inflation watchdog says it is leaving short-term interest rates at near zero.</p> <p> Why?</p> <p><a href="http://www.globalpost.com/dispatches/globalpost-blogs/macro/federal-reserve-leaves-us-rates-unchanged" target="_blank">read more</a></p> Federal Reserve US Economy Business Global Economy Macro Tue, 13 Dec 2011 20:06:00 +0000 Thomas Mucha 5684164 at http://www.globalpost.com US-China: Hints of a trade war? http://www.globalpost.com/dispatches/globalpost-blogs/macro/us-china-autos-trade-tariffs <div class="field field-type-text field-field-subhead"> <div class="field-items"> <div class="field-item odd"> China will impose punitive duties of up to 22 percent on large cars and SUVs exported from the US. </div> </div> </div> <div class="field field-type-text field-field-byline1"> <div class="field-items"> <div class="field-item odd"> Thomas Mucha </div> </div> </div> <!--paging_filter--><p> This is not what the fragile global economy needs right now. And it&#39;s certainly not what fragile Detroit needs, either.&nbsp;</p> <p> China&#39;s Commerce Ministry today said that it is imposing tariffs on&nbsp;large cars and SUVs exported from the United States.</p> <p> Those duties could be as much as 22 percent, <a href="http://www.reuters.com/article/2011/12/14/us-china-us-trade-idUSTRE7BD1LJ20111214" target="_blank">Reuters reported</a>. And they will be tacked on to an existing 25 percent tariff that&#39;s imposed on US auto exports in China.</p> <p> Reaction by US lawmakers has been, not surprisingly, swift:</p> <p> &quot;China relentlessly breaks international trade rules and seeks to gain an anti-competitive advantage over our companies and workers. America must be equally relentless in fighting back,&quot; said Sen. Debbie Stabenow, who represents Michigan.</p> <p> Stabenow wants <a href="http://www.ustr.gov/" target="_blank">the USTR</a>&nbsp;to take action. Four US House of Representative members agree, and called Beijing&#39;s move&nbsp;&quot;unjustifiable&quot; and &quot;one more instance of impermissible Chinese retaliation against the United States and other trading partners,&quot; according to Reuters.</p> <p> This latest trade mash-up comes at a particularly bad time for Detroit as US automakers have been aggressively targeting China, the world&#39;s biggest market for autos.</p> <p> <strong>More from Thomas Mucha: <a href="http://www.globalpost.com/dispatch/commerce/100108/general-motors-china-car-sales" target="_blank">Can China save General Motors?</a></strong></p> <p> But auto sales in China have slowed dramatically, so Beijing is stepping in to protect its homegrown industry.</p> <blockquote><p> &ldquo;The move shows that China is always capable of intervening politically in its markets,&rdquo; Urgent Pepper, an analyst with Bankhaus Metzler <a href="http://news.businessweek.com/article.asp?documentKey=1376-LW6TIR6KLVR401-6293LME4PUN6LPIMFDF949PLBL" target="_blank">told Bloomberg</a>. &ldquo;The automobile industry is very dependent on China for growth, and there&#39;s doubts about the pace of future expansion.&rdquo;</p> </blockquote> <p> Today&#39;s spat is also part of a longer-running auto trade fight between the world&#39;s two largest economies.</p> <p><a href="http://www.globalpost.com/dispatches/globalpost-blogs/macro/us-china-autos-trade-tariffs" target="_blank">read more</a></p> Auto Industry China Detroit US Economy Business Politics Global Economy Macro Wed, 14 Dec 2011 22:18:00 +0000 Thomas Mucha 5684299 at http://www.globalpost.com Decoding Ben Bernanke and the Fed: What is money, anyway? http://www.globalpost.com/dispatches/globalpost-blogs/macro/money-federal-reserve <div class="field field-type-text field-field-subhead"> <div class="field-items"> <div class="field-item odd"> The answer is not as simple as you think. </div> </div> </div> <div class="field field-type-text field-field-byline1"> <div class="field-items"> <div class="field-item odd"> Thomas Mucha </div> </div> </div> <!--paging_filter--><p> Hooray for Jon Hilsenrath, the Wall Street Journal&#39;s chief economics correspondent.</p> <p> Hilsenrath has done the world a favor by writing <a href="http://blogs.wsj.com/economics/2011/12/28/what-is-money-and-how-do-you-destroy-it/" target="_blank">this must-read story</a>&nbsp;on the Journal&#39;s excellent <a href="http://blogs.wsj.com/economics/" target="_blank">Real Time Economics blog</a>:&nbsp;&quot;What is Money and How Do You Destroy It?&quot;</p> <p> It&#39;s 2,129 smart, well-researched and deeply-reported words that anyone who&#39;s interested in how the economy really works should read.</p> <p> In it, Hilsenrath deconstructs the many Republican presidential candidate criticisms of Fed Chairman Ben Bernanke&#39;s policies, which Newt Gingrich calls &quot;the most inflationary and dangerous in history.&quot;</p> <p> But he also delves into deeper historical, philosophical and economic questions such as:</p> <p> <em>What is money?</em> (It&#39;s a medium of exchange).</p> <p> <em>How much money is out there, and what&#39;s it worth?</em> (It&#39;s complicated as the vast majority of money in the US economy isn&#39;t paper or coins, but rather &quot;a bunch of zeroes and ones, electronic accounts in computer systems that tally who owes what to whom,&quot; Hilsenrath writes).</p> <p> <em>How to know whether all the new electronically generated money is destroying the dollar?</em> (The dollar&#39;s value has been &quot;on a roller coaster&quot; since the 2008 Great Recession, and today it&#39;s worth just about the same as it was just before the collapse of Lehman Brothers).&nbsp;</p> <p> <em>How has inflation fared under Bernanke&#39;s Fed?</em> (&quot;Inflation might take off and wreck the purchasing power of a dollar. But official statistics suggest it hasn&rsquo;t yet happened,&quot; he writes).</p> <p> The piece ends on a cautionary note about the dollar&#39;s more recent value, and as the point bears remembering I&#39;ll quote Hilsenrath in full:</p> <p><a href="http://www.globalpost.com/dispatches/globalpost-blogs/macro/money-federal-reserve" target="_blank">read more</a></p> Ben Bernanke Federal Reserve US Economy Business Politics Macro Thu, 29 Dec 2011 15:05:00 +0000 Thomas Mucha 5685380 at http://www.globalpost.com US auto industry expects profits in 2012 http://www.globalpost.com/dispatch/news/regions/americas/united-states/120109/us-auto-industry-expects-profits-2012 <p> At this week&#39;s Detroit auto show, experts say the American auto industry is on the road to recovery</p> <p><a href="http://www.globalpost.com/dispatch/news/regions/americas/united-states/120109/us-auto-industry-expects-profits-2012" target="_blank">read more</a></p> 2012 Auto Industry Detroit Global Economic Crisis US Economy China Global Economy Japan United States Mon, 09 Jan 2012 21:15:00 +0000 Jennifer Mattson 5686548 at http://www.globalpost.com Orange juice prices hit record high http://www.globalpost.com/dispatch/news/regions/americas/120111/global-orange-juice-prices-hit-record-high <p> Cold weather in Florida and safety concerns about juice from Brazil are driving the price of orange juice to a record high.</p> <p><a href="http://www.globalpost.com/dispatch/news/regions/americas/120111/global-orange-juice-prices-hit-record-high" target="_blank">read more</a></p> Brazil Food food prices orange juice US Economy Americas Brazil United States Wed, 11 Jan 2012 19:50:00 +0000 Jennifer Mattson 5686990 at http://www.globalpost.com America leading the world in debt deleveraging http://www.globalpost.com/dispatches/globalpost-blogs/macro/america-leading-debt-deleveraging <div class="field field-type-text field-field-subhead"> <div class="field-items"> <div class="field-item odd"> The US is leading its peer countries in cutting total debt. Here's why that matters. </div> </div> </div> <div class="field field-type-text field-field-byline1"> <div class="field-items"> <div class="field-item odd"> Thomas Mucha </div> </div> </div> <!--paging_filter--><p> The United States is cutting its debt. Well, the private sector is, anyway.</p> <p> That&#39;s one key takeaway from an <a href="http://www.mckinsey.com/Insights/MGI/Research/Financial_Markets/Uneven_progress_on_the_path_to_growth" target="_blank">interesting report released today by The McKinsey Global Institute</a>&nbsp;on how economies around the world are handling their debt problems that resulted from the 2008 global credit bubble and subsequent financial crisis.&nbsp;</p> <p> The US now leads the world&#39;s 10 largest countries in cutting its total debt, the report states. South Korea and Australia are the only two other countries where the ratio of total debt (private and public sector) has fallen relative to GDP.</p> <p> It&#39;s an important stat, as McKinsey points out, because lower private debt often clears the way for economic growth, which in turn allows for public debt levels to eventually come down, too.</p> <p> Here are the report&#39;s money quotes on how things are shaking out in debt-ridden America:</p> <blockquote><p> Debt in the financial sector has fallen back to levels last seen in 2000, before the credit bubble, and the ratio of corporate debt relative to GDP has also fallen. US households have made more progress in debt reduction than other countries, and may have roughly two more years before returning to sustainable levels of debt.</p> </blockquote> <p> Two risks remain that could derail the deleveraging trend, McKinsey warns:</p> <p><a href="http://www.globalpost.com/dispatches/globalpost-blogs/macro/america-leading-debt-deleveraging" target="_blank">read more</a></p> Debt Crisis US Economy Business Debt Crisis Global Economy Macro Thu, 19 Jan 2012 14:47:00 +0000 Thomas Mucha 5688075 at http://www.globalpost.com Obama SOTU speech connects on the economy http://www.globalpost.com/dispatches/globalpost-blogs/macro/obama-sotu-speech-economy-swing-voters <div class="field field-type-text field-field-subhead"> <div class="field-items"> <div class="field-item odd"> Swing voters liked the economic fairness message, anyway. </div> </div> </div> <div class="field field-type-text field-field-byline1"> <div class="field-items"> <div class="field-item odd"> Thomas Mucha </div> </div> </div> <!--paging_filter--><p>President Barack Obama&#39;s <a href="http://www.globalpost.com/dispatch/news/regions/americas/united-states/120124/barack-obamas-state-the-union-address-2012-video">State of the Union speech last night</a> was clearly designed to kick off his 2012 reelection campaign by framing his eventual Republican contender&nbsp;&mdash; whoever that might be&nbsp;&mdash; as a heartless economic Darwinian. (Check out<a href="http://www.nytimes.com/2012/01/25/us/politics/obama-sets-sights-on-romney-in-state-of-the-union.html?_r=1&amp;hp" target="_blank"> this smart New York Times analysis</a>&nbsp;by Mark Landler that expounds on the point).&nbsp;</p> <p>But by making economic equality the centerpiece of his address, Obama was a hit last night with swing voters&nbsp;&mdash; those people critical to his success or failure in November.</p> <p>That&#39;s the read, at least, from Democratic pollsters Democracy Corps.</p> <p>Check out <a href="http://www.democracycorps.com/strategy/2012/01/president-obama-scores-with-middle-class-message/#ftn1" target="_blank">this chart</a>, which shows what swing voters thought of last night&#39;s message.</p> <p><img alt="" class="imagecache-use-with-caution_original" src="http://www.globalpost.com/sites/default/files/imagecache/use-with-caution_original/democracy_corps_chart.jpg" title="" /></p> <p><a href="http://www.democracycorps.com/" target="_blank">Source: Democracy Corps</a></p> <p>Those are some pretty good results, no matter how you cut it. The 24-point swing on the middle class point is particularly arresting.&nbsp;</p> <p>Of course, economic fairness is a theme that loyal Macro readers will find familiar.</p> <p><a href="http://www.globalpost.com/dispatches/globalpost-blogs/macro/obama-sotu-speech-economy-swing-voters" target="_blank">read more</a></p> 2012 US Elections President Barack Obama US Economy Business Elections Politics Macro Wed, 25 Jan 2012 17:05:00 +0000 Thomas Mucha 5688849 at http://www.globalpost.com Fed keeps interest rates near zero until 2014 http://www.globalpost.com/dispatches/globalpost-blogs/macro/fed-keeps-interest-rates-near-zero-until-2014 <div class="field field-type-text field-field-subhead"> <div class="field-items"> <div class="field-item odd"> The Federal Reserve does its part to help the US economy. Again. </div> </div> </div> <div class="field field-type-text field-field-byline1"> <div class="field-items"> <div class="field-item odd"> Thomas Mucha </div> </div> </div> <!--paging_filter--><p> The Federal Reserve is doing its best to do nothing.</p> <p> That&#39;s the quiescent&nbsp;<a href="http://www.globalpost.com/dispatch/news/regions/americas/united-states/120125/fed-keeps-interest-rates-near-zero-until-2014-re" target="_blank">word out of Washington, D.C. today</a>, as Ben Bernanke and team said they would leave US interest rates at &quot;exceptionally low levels at least through late 2014.&rdquo;</p> <p> While noting some improvement in the overall labor market, the Fed gang pointed to a still-high unemployment rate, as well as the weak housing market and slowing business investment.</p> <p> So it&#39;ll try to keep things going in the world&#39;s largest economy, by keeping rates low.</p> <p> Here&#39;s the money quote, pulled from the latest <a href="http://www.federalreserve.gov/newsevents/press/monetary/20120125a.htm" target="_blank">Federal Open Market Committee notes</a>:</p> <blockquote><p> To support a stronger economic recovery and to help ensure that inflation, over time, is at levels consistent with the dual mandate, the Committee expects to maintain a highly accommodative stance for monetary policy. In particular, the Committee decided today to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that economic conditions--including low rates of resource utilization and a subdued outlook for inflation over the medium run--are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014.</p> </blockquote> <p> But, as usual, I prefer my economic arguments in easy-to-digest rap form.</p> <p><a href="http://www.globalpost.com/dispatches/globalpost-blogs/macro/fed-keeps-interest-rates-near-zero-until-2014" target="_blank">read more</a></p> Federal Reserve US Economy Business Global Economy Macro Wed, 25 Jan 2012 19:38:00 +0000 Thomas Mucha 5688903 at http://www.globalpost.com US Economy: Why Obama's economic recovery is impressive http://www.globalpost.com/dispatch/news/regions/americas/united-states/120130/business-insider-why-obama-recovery-better-than-reagan <p>We can easily identify some huge differences between the conditions that Obama inherited and what Reagan inherited.</p> <p><a href="http://www.globalpost.com/dispatch/news/regions/americas/united-states/120130/business-insider-why-obama-recovery-better-than-reagan" target="_blank">read more</a></p> President Barack Obama US Economy Business Politics United States Mon, 30 Jan 2012 23:14:00 +0000 Joe Weisenthal, Business Insider 5689570 at http://www.globalpost.com Ahead of tomorrow's jobs report, a look at broader unemployment http://www.globalpost.com/dispatches/globalpost-blogs/macro/ahead-tomorrows-jobs-report-look-at-broader-unemployment <div class="field field-type-text field-field-subhead"> <div class="field-items"> <div class="field-item odd"> A state-by-state look at unemployment, and under-employment. </div> </div> </div> <div class="field field-type-text field-field-byline1"> <div class="field-items"> <div class="field-item odd"> Thomas Mucha </div> </div> </div> <!--paging_filter--><p>Friday is the big day of the week for watchers of the US economy.</p> <p>The Labor department will release its latest check-up of US unemployment, the most important measure of the world&#39;s largest economy.&nbsp;</p> <p>Why is this one report so important every month?</p> <p>People don&#39;t spend if they don&#39;t have jobs. And the US economy is driven largely by consumer spending. So any economic recovery begins in your wallet, and hence, in the labor market.</p> <p>It&#39;s also important right now in the context of the 2012 presidential election, as President Barack Obama will argue that his administration has done an effective job bringing the US economy back. The GOP candidate, which increasingly appears will be Mitt Romney, will no doubt attack Obama on jobs.</p> <p>So Friday&#39;s report will provide further ammunition to both sides, and give the rest of us another data point to chew over.&nbsp;</p> <p>Ahead of that key report, our friends at the <a href="http://blogs.wsj.com/economics/" target="_blank">Wall Street Journal&#39;s Real Time Economics</a> blog have posted this handy<a href="http://blogs.wsj.com/economics/2012/02/01/broader-unemployment-rates-by-state-2/tab/interactive/" target="_blank">&nbsp;interactive map</a>, which offers a state-by-state breakdown of the broader unemployment measure called the U-6 rate.</p> <p>The U-6 rate includes those Americans who would like a job, but who are so discouraged by the weak labor market conditions that they have dropped out (and are, accordingly, not be counted).</p> <p>Click <a href="http://blogs.wsj.com/economics/2012/02/01/broader-unemployment-rates-by-state-2/tab/interactive/" target="_blank">here</a> for the interactive map, and see below for the screen grab (the Journal won&#39;t let me embed it here, unfortunately).</p> <p>The darker the blue, the deeper the problems:</p> <p><a href="http://www.globalpost.com/dispatches/globalpost-blogs/macro/ahead-tomorrows-jobs-report-look-at-broader-unemployment" target="_blank">read more</a></p> 2012 US Elections US Economy US Unemployment Business Macro Thu, 02 Feb 2012 22:25:00 +0000 Thomas Mucha 5690170 at http://www.globalpost.com Chart of the day: Obama and jobs http://www.globalpost.com/dispatches/globalpost-blogs/macro/chart-the-day-obama-jobs-economy-election <div class="field field-type-text field-field-subhead"> <div class="field-items"> <div class="field-item odd"> If the 2012 election pivots on the economy, then things are looking up for President Obama. </div> </div> </div> <div class="field field-type-text field-field-byline1"> <div class="field-items"> <div class="field-item odd"> Thomas Mucha </div> </div> </div> <!--paging_filter--><p>Conventional wisdom, of course, is often wrong.</p> <p>But, that said, the current CW goes something like this: the 2012 election is going to be about the US economy. And specifically, about jobs.</p> <p>If that&#39;s indeed the case, then things are looking up for President Obama.</p> <p>Here&#39;s the one chart that makes the case:</p> <p><img alt="" class="imagecache-gp3_full_article" src="http://www.globalpost.com/sites/default/files/imagecache/gp3_full_article/initial_jobless_claims_graph_jpeg.jpg" title="" /></p> <p><a href="http://www.globalpost.com/dispatches/globalpost-blogs/macro/chart-the-day-obama-jobs-economy-election" target="_blank">read more</a></p> 2012 US Elections Jobs President Obama US Economy Business Elections Politics Macro Thu, 09 Feb 2012 20:11:00 +0000 Thomas Mucha 5691128 at http://www.globalpost.com US consumer spending up sharply in March http://www.globalpost.com/dispatch/news/business-tech/120416/us-consumer-spending-sharply-march American consumer spending was up in March, according to Commerce Department figures released Monday, in a sign that points to speedier recovery in 2012.<p><a href="http://www.globalpost.com/dispatch/news/business-tech/120416/us-consumer-spending-sharply-march" target="_blank">read more</a></p> United States US Economy Business Mon, 16 Apr 2012 20:06:26 +0000 Alexander Besant 5700605 at http://www.globalpost.com Tons of stuff happened this morning — here's why it's causing the dollar to surge http://www.globalpost.com/dispatch/news/business/120705/business-insider-us-economy-dollar-surge <p><span style="line-height: 20px; ">The US economy is showing a pulse (add those numbers into the latest positive data on construction, cars, and houses) and it&#39;s not clear that the Fed has any urgency to act. While the rest of the world is easing, the Fed is seeing a US economy that seems to be hanging on.</span></p> <p><a href="http://www.globalpost.com/dispatch/news/business/120705/business-insider-us-economy-dollar-surge" target="_blank">read more</a></p> US Economy France China Global Economy Japan United States Thu, 05 Jul 2012 15:50:00 +0000 Joe Weisenthal, Business Insider 5710668 at http://www.globalpost.com The Fed is more profitable than Apple and Exxon. Combined. http://www.globalpost.com/dispatches/globalpost-blogs/macro/the-fed-more-profitable-apple-and-exxon-combined <div class="field field-type-text field-field-subhead"> <div class="field-items"> <div class="field-item odd"> How economic crisis can sometimes be good for the bottom line. </div> </div> </div> <div class="field field-type-text field-field-byline1"> <div class="field-items"> <div class="field-item odd"> Thomas Mucha </div> </div> </div> <!--paging_filter--><p>The key to good business writing is the frame.</p> <p>In other words, how do you take arcane figures and put them into an easy-to-understand context that&#39;s smart, useful and memorable?</p> <p>Our friends at <a href="http://qz.com/" target="_blank">Quartz</a> nailed that task today, with a post titled <a href="http://qz.com/42515/the-us-fed-made-a-greater-profit-than-apple-and-exxon-combined-last-year/" target="_blank">&quot;The US Fed had a greater profit than Apple and Exxon combined last year.&quot;</a></p> <p>Catchy headline: check. Interesting topic: check.</p> <p>The skinny?</p> <p>The Federal Reserve turned a profit last year of $89 billion dollars, its best year in history.</p> <p>As Quartz points out, the combined profits of Apple and Exxon &mdash; America&#39;s two most profitable companies &mdash; top a little more than $82 billion.</p> <p>So how did the Fed do it?</p> <p>Economic crisis, of course.</p> <p><a href="http://www.globalpost.com/dispatches/globalpost-blogs/macro/the-fed-more-profitable-apple-and-exxon-combined" target="_blank">read more</a></p> Apple Exxon Federal Reserve US Economy Business Global Economy United States Macro Fri, 11 Jan 2013 15:00:00 +0000 Thomas Mucha 5733177 at http://www.globalpost.com Stocks surge higher on positive news about US economy http://www.globalpost.com/dispatch/news/business/130517/us-stocks-surge-higher-positive-economic-news The Dow Jones industrial average closed up 121 points to end the week at 15,354. <p><a href="http://www.globalpost.com/dispatch/news/business/130517/us-stocks-surge-higher-positive-economic-news" target="_blank">read more</a></p> Companies Need to Know US Economy Business United States Fri, 17 May 2013 22:48:00 +0000 Jennifer Mattson 5840627 at http://www.globalpost.com