Great epistemic practice here: www.nytimes.com/2025/12/18/u...

A number of people have asked me about this and I fully agree with Omari Sharif (@fcastofthemonth) who is the absolute dean of CPI analysis. Actual rents appear to have slowed in Oct/Nov, but not unrealistically so - about the same rate they hit in Sept. But OER (more on that to follow) plunged.

5 weeks ago, I wrote about the shutdown's impact on the labor market and how big it would be. A big reason why the impact has been small so far: few irreversible events. But we're starting to cross some potentially more serious and economically destructive milestones...

I really don't think this is the right takeaway. Solar is great but electricity that is available only at certain times and only under certain conditions is not a great substitute for dispatchable power. It would benefit clean energy advocates to give more thought to how to produce clean firm power.

The podcast version of our BPEA paper on “Who bears the burden of climate inaction?” (thread below, with @cwolfram.bsky.social and @knittelmit.bsky.social) just dropped . www.brookings.edu/articles/how...

🧵 (1/7) With @knittelmit.bsky.social and @cwolfram.bsky.social, happy to announce our new paper on “Who Bears the Burden of Climate Inaction?”, just posted for BPEA @brookings.edu. We find large climate cost impacts that vary by both geography and income. www.brookings.edu/articles/who...

Thanks to @kclausing.bsky.social for the great thread on our BPEA paper with @knittelmit.bsky.social! Bottom line: US households experience climate change primarily through wildfires and storms more than heat.

1/8: Quick thread on a new short paper with Mike Waugh in the latest edition of the Minneapolis Fed Quarterly Review:

Imho too much discussion on here about whether the labor market is weak or not given slowdown in labor supply. Too little discussion of how to proceed with downside risks to both sides of the mandate.

The implication is that the rest of the Board is accepting her firing, and that she has been removed. Not good. The better strategy would be to continue work as normal and make Trump get an order removing her.

TFW no one talked to a macroeconomists at any point from working paper to publication: www.washingtonpost.com/climate-envi...

This is exactly right. Anyone voting for the spending bill is voting for higher energy bills and blackouts.

A sad capitulation from the Timberpuppies. Sigh.

Federal Reserve to slash staff by 10% over several years https://www.ft.com/content/927ba69e-3037-4e0f-b9a6-1eeaac8b03b7

Initial claims come in slightly above prior non-recessionary years, both in headcount (1st) & share-of-emp (2nd) terms. Initial claims are ~19K above where they were same week in 2019. Not a catastrophe but it's notable. Continuing claims slightly above recent years too (3rd).

Remarkable how Trump dealt himself the worst possible hand to negotiate w/ China. 1st card: Enacted tariffs that threaten to tank the economy 2nd: Backs China into a corner. 3rd: Makes fed incapable of responding 4th: Tanks markets, bonds and the dollar 5th: no end game, no plan

Greg Gutfield unimpressed by Ernie and company fancy math cc @marthagimbel.bsky.social @ernietedeschi.bsky.social

Unchanged jobless claims in the face of multiple standard deviation uncertainty shocks is fairly impressive.

This is wrong - only Chetty is supposed to have access to all these data sets.

Maybe there's an innocuous explanation, but we might be seeing the consequences of squandering our exorbitant privilege in the first 100 days:

Every day we learn anew just how much classified ads were perhaps the load-bearing pillar of American hegemony

😬

Strong Tower of Juche energy today: www.google.com/url?sa=i&url...

Well it was a good run.

It would really be good if blue states and universities stepped into the breach - replacing the funding the NSF and NIH is not a heavy lift fiscally.

Just an incredibly ugly ISM Manufacturing report. The only categories that are rising relate to prices and inventories. Everything else going down. And virtually all of the comments are from manufacturers complaining about the tariffs. Full newsletter here: www.bloomberg.com/news/newslet...

Pretty impressive combination of increased generation and reduced emissions in EU power generation:

I want to say something precise: I have never seen evidence of any kind that CEOs in general are anything other than replacement level thinkers, and significant evidence that the typical CEO is way below replacement level. That doesn't mean they *all* are, but hoooooo boy is it a skinny right tail.

This may come to pass, but this is not what you should conclude from the Atlanta Fed nowcast or the data we've currently seen:

Economy is definitely softening, but this estimate is driven entirely by the huge decrease in trade balance from trying to avoid tariffs. Net exports subtracting 3.7 percentage points from GDP growth:

In a feat of impeccable timing, the wonderful editors at the Lewis & Clark Law Review have finished their work on my article, "Is Originalism Bullshit?" The final version is now online at SSRN: papers.ssrn.com/sol3/papers....

Budget neutrality over a 10-year window does not imply non-inflationary/non-stimulative. I think @jasonfurman.bsky.social (and @mattyglesias.bsky.social, etc.) point was that these policies added further demand to an economy characterized by excess demand. x.com/BrianCDeese/...

Today, Brookings released a report I wrote with Neil Mehrotra and Eric So modeling the impact of AI on old-age entitlement expenditures like Medicare and Social Security. Read it here: www.brookings.edu/articles/the...

Always here for some weedsy discussion of price indices:

Nothing that we have seen so far would imply macroeconomic effects anywhere close to this magnitude:

Agree with Martha's take here:

A cogent but largely critical retrospective from @jasonfurman on the Biden economic legacy (1/8):

The four charts that lead me to believe the economy continues to slow in a concerning way: 1) the average workweek is very low 2) manufacturing job growth is negative and is worsening 3) the hires rate remains early 2010’s sluggish 4) the largest publicly-traded homebuilder stock is cratering

There's a lot of uncertainty, but if cuts of the magnitude suggested here materialize at NIH, NSF, and for other government funding research, blue states ought to consider banding together and stepping into the breach (1/5): wapo.st/3Q9DrIH

(1/3) Some Early Lessons from the Trade War of February 1-3, aka the Groundhog Day trade war #1 The good news. The US govt decided *not* to levy the largest tax increase in a generation, which would have been very distortionary, hurting production, employment, and growth across North America.

Alix Partners estimates on new tariff impact for the auto sector specifically - 1/4 of US vehicles face the full tariff directly - Impacted parts & components ~$225bn per year - $60bn in incremental costs industry-wide - $3k per vehicle price impact - Mexican-sourced parts carry 2-10% margins

Trump's latest tariffs would represent “the largest tax increase since the 1990s," per @kclausing.bsky.social www.ft.com/content/3cc2...

Hard to know the ultimate scope, but the executive orders that appear to pause even obligated spending could exert a meaningful labor market drag in coming months.

Happy Valentine's, everyone! https://buff.ly/4jzqYvi

Big, if true

Important story here from my colleague @alexckaufman.bsky.social It's about how Trump's policy directives are killing wind energy projects, but also about how the Democrats' failure to fix permitting was undermining these projects even beforehand www.huffpost.com/entry/trump-...

So much winning: www.wbur.org/news/2025/01...

NEW: Trump’s anti-wind order does *not* just apply to offshore wind. That’s because all wind projects need federal permits, even if they’re not on federal property. Lobbyists believe that Trump’s order could hit “more than half” of wind farms now under development. heatmap.news/plus/the-fig...