US Economy


Alarm! “US to face underpopulation”

The population ponziteers are at it again, this time warning that the US is facing “underpopulation” because its birth rate has fallen to a 35 year low: The U.S. birth rate in 2019 fell to its lowest level in 35 years, well below the requisite 2.1 babies per woman required to sustain our population through


American consumer in rude health

Via BofA: A unique feature of the COVID shock is its highly unequal impact on goods versusservicesspending. •Normally fiscal stimulus causes a surge in both goods and servicesspending; in thiscycle services spending could not respond. •The combination of aggressive fiscal stimulus and constraints on spending hascreated a massive surge in“excess”saving. •The recent actual and proposed


Gittins: Trump was symptom not cause of US divisions

Darling economic commentator of the left, Ross Gittins, has stuck his thumb directly into the eye of the radicalised anti-American versions of history being pumped out by the likes of the ABC: For a harder-nosed expose of life on the margins of America’s mighty economy, I recommend the recent work of the Nobel prize-winning Scottish


US COVID hospitalisations about to plunge, growth surge

Via Goldman: We believe that a vaccine-driven reduction in hospitalizations is likely to kick offthe growth rebound through relaxed restrictions and some reductions involuntary consumer social distancing. We model the vaccine impact on hospitalizations in the US, where they appear to have peaked–consistent with the projections of our equity research colleagues a month ago–and in


Bidencare to lift US worker living standards

Via Goldman: We assess the macroeconomic implications of President-elect Biden’s campaign proposal to modify and expand the Affordable Care Act (ACA), which we believe has a good chance of enactment through the reconciliation process. Because many of the effects of the original ACA would likely recur on a smaller scale, we review the research literature


How much Biden stimulus will get up?

Via Goldman: President-elect Biden is proposing $1.9 trillion in new fiscal relief measures, in addition to the roughly $950bn Congress approved in December 2020.He has proposed substantial spending in all of the areas we expected, including an additional $1,400/person in stimulus payments, further extension of expanded unemployment benefits (through September 2021 and including a $400/week


US about to kill the virus

Via BofA:  Discharged from hospital. We saw a 2,091 person decrease in the number of people hospitalized in the US with Covid-19 over the last week, the first decline since September 23rd. Just four days ago there was a 7,167 person weekly increase and since then the number has declined gradually. While the decrease


US politics is setting course for better not worse

As usual, we turn to the ABC for the worst possible take on US politics. Stan Grant has taken a leaf straight out of the “we’re all rooned, said Stanrahan” playbook: CNN called this a “solemn” moment. The impeachment — again — of Donald Trump is about the soul of America. It is more accurate


Is this the end for El Trumpo?

Congress has just voted to impeach El Trumpo over the Capilo riot. Will Trump now face an impeachment trial? Not by Republicans in the next few days he won’t: NEWS —> McConnell’s office called Schumer’s people today + told them McConnell would not consent to reconvening immediately under the 2004 emergency authorities, a person familiar


Trump spared loony removal but impeachment push grows

No loony removal for El Trumpo: BREAKING: Vice President Mike Pence says he WILL NOT invoke the 25th Amendment to remove President Trump from office – CNBC — Breaking911 (@Breaking911) January 13, 2021 But, at NYT: Senator Mitch McConnell of Kentucky, the Republican leader, has told associates that he believes President Trump committed impeachable


Here comes the inflation panic

Via Goldman: Bond sell-off indicates new real rates regime Since the start of the year US bonds have been under pressure as the ‘reflationary’ theme has gained momentum. Despite the concerning increase of new COVID-19infections, the Democratic win in the Georgia runoffs, the OPEC oil cuts and stronger-than-expected December data provided solid support for more


More Trump protests planned?

Via NYT: Officials in state capitals across the country are bracing for a spillover from last week’s violent assault on the U.S. Capitol, with legislatures already becoming targets for protesters in the tense days around the inauguration of the incoming president, Joseph R. Biden Jr. Gone is a large measure of the bonhomie that usually accompanies


Civility is always the limit of free speech

Australia’s own brand of loons are upset, at The Australian: Senior Morrison government ministers have slammed the silencing of outgoing US president Donald Trump by social media giants after the pro-Trump siege of the Capitol. Josh Frydenberg and Acting Prime Minister Michael McCormack spoke out against Twitter’s decision to permanently ban Mr Trump days before


An historian’s view of the Capitol riot

From Niall Ferguson at Bloomie: Major pandemics often coincide with religious or political contagions. In his “History of the Peloponnesian War,” Thucydides records how, during the plague that devastated Athens between 430 and 426 BC, people seemed to lose their moral compasses. …During the Black Death that swept across Europe in the 1340s, flagellant orders


Will Trump be impeached?

Decide for yourself: (THREAD) To understand the second impeachment of Donald Trump, we must understand the words that preceded and augmented his January 6 incitement of insurrection. This thread unpacks four key speeches—Don Jr., Giuliani, Mo Brooks, and Eric Trump. I hope you’ll read on and RETWEET. — Seth Abramson (@SethAbramson) January 10, 2021


US Labor Market sours

Ahead of Non Farm Payrolls on Friday, the US Bureau of Labor Statistics has posted poor employment figures for 2020, providing a sobering reminder of the devastation of jobs last year: 242 out of 389 metropolitan areas had decreases in employment for the year ended November 2020 From November 2019 to November 2020, 242 metropolitan


Trump concedes new administration will be inaugurated on 20 January — Donald J. Trump (@realDonaldTrump) January 8, 2021 President Donald Trump posted his latest video to Twitter, his first Tweet since his expired suspension for inciting violence. In the address, Trump says he is committed to a smooth and orderly transition: “Now Congress has certified the results. A new administration will be inaugurated on


US hospitalisations, deaths soon to peak

Via Goldman: Vaccine impact on US Hospitalizations Hospital utilization has been a key factor driving reopening sentiment.COVID-19has proven to be most deadly to vulnerable populations when adequate medical care is not available. Campaigns to “flatten the curve” in March/April had the stated goal of reducing the potential for the pandemic to overwhelm the hospital system.


If Biden wins Georgia, what will assets do?

Via Goldman: Focus is likely to intensify further on Georgia’s two Senate runoff elections, which will determine control of the Senate. We look here at the implications for key assets of a shift from the current Republican Senate majority to Democratic control of the Senate, using the same cross-asset approach that we have used to


Biden takes lead in senate race

Via 538: These are 538 adjusted polls. If they prove correct then: Biden stimulus will be unleashed leading to… steepening yield curve (possibly sharp); value rotation rocket; possible blow-off and dump of stocks; falling DXY and rising AUD but also an emerging US growth advantage to reverse it; commodities bid and blowoff especially for copper


US jobs preview

Via Calculated Risk: On Friday at 8:30 AM ET, the BLS will release the employment report for November. The consensus is for 500 thousand jobs added, and for the unemployment rate to decrease to 6.7%. First, there are a wide range of estimates.  For example, from Merrill Lynch economists: “We look for November jobs report


The US third virus wave is peaking

Good news. Cases in the US third wave appear to be peaking: Both cases and hospitalisations are seeing a flattening curve. Deaths will climb for a few more weeks. All regions bar the north east have improved: Cases are falling where lockdowns are strongest, as you’d expect. There must be an asterisk over this data


Inside Janet Yellen’s head is an enormous dove

From a recent speech by Janet Yellen, incoming US Treasury Secretary: Extreme economic events have often challenged existing views of how the economy works and exposed shortcomings in the collective knowledge of economists. To give two well-known examples, both the Great Depression and the stagflation of the 1970s motivated new ways of thinking about economic


Measuring the US fiscal cliff

Via BofA: Fiscal cliff economics • Many pandemic-aid programs in the CARES Act are set to expire at the end of the year without action from Congress. • The expiration of federal UI programs—PUA and PEUC—alone could be a drag of 1.5pp in 1Q. Cutoff of other provisions will be additional headwinds. • We expect


US virus deaths launch

Sadly the pandemic is about to enter its next dire phase. Cases are still surging along with hospitalisations and, as they flounder, deaths: Smoothed doesn’t look any better: The mortality rate has probably bottomed now as the death lag closes: El Trumpo‘s revenge is about to enter its final dark days as the economy remains