Publications

Paul Hannon and David Harrison of the Wall Street Journal write that as central bankers around the world begin to tighten monetary policy, inflation has been falling. Despite nearly a decade of loose monetary policy, many G20 nations face weak inflation, bringing into question the traditional link between healthy economies and rising prices. WSJ

The Financial Times reports that the U.S. auto industry faces both declining sales and employment, undermining much of the sector’s recovery since the recent recession. The authors point to the exhaustion of “pent-up demand” from the recession and the rise of ride-hailing apps as two factors contributing to the decline. FT

The Wall Street Journal reports that leading indicators from the OECD suggest that growth in the U.S. this year may be weaker than previously expected.  The fading possibility of substantial tax reform or infrastructure spending occurring in 2017 has driven the downward revisions to OECD projections for the U.S. WSJ

Federal Reserve governor Jerome Powell says that the U.S. housing finance system is in drastic need of reform. In recent remarks, Powell called for Congress to encourage private investment into Fannie Mae and Freddie Mac in order to shield taxpayers from credit risk. WSJ

The Financial Times reports that Fed officials disagree about the timing of the reduction of the Fed’s balance sheet. While some officials believe that the Fed should wait until September to act, other officials say that the U.S. economy is at risk of overheating and the Fed should act sooner. FT

According to the Washington Post, mortgage rates have surged in recent weeks due to uncertainty regarding future moves by the Fed. Borrowing rates increased when the Fed confirmed that it will begin unwinding its massive balance sheet in the near future, which should have largely the same effect as a rate hike, though market watchers are unsure of the magnitude of the effect. WaPo

Greg Ip of the Wall Street Journal writes that the U.S. economy currently has all the preconditions necessary for a recession. Ip highlights factors such as a healed labor market, exceptionally high asset valuations, tightening monetary policy, and exceedingly low volatility as common precursors to economic downturns. WSJ

The Wall Street Journal reports that the Federal Reserve is expected in September to announce a move to begin shrinking its balance sheet. Experts expect the Fed to hold off on another rate hike until December in order to assess markets’ response to the unprecedented unloading of assets. WSJ

Neil Irwin of the New York Times writes that Americans’ outlook for the U.S. economy has soared after the November presidential election but actual economic activity has been tepid.  Irwin argues that despite the sustained gains in almost every measure of consumer and business confidence actual spending and investment have been slowed by policy uncertainty and weak wage growth. NYT

Ben Leubsdorf of the Wall Street Journal argues that differences in child care policy may explain why female labor force participation is lower in the U.S. than in Canada. Leubsdorf believes that the U.S. should follow Canada’s lead in expanding part-time job opportunities, providing more affordable child care, and extending paid leave following childbirth. WSJ

According to the Wall Street Journal, U.S. car manufacturers observed sharp declines over the first half of 2017 as auto sales fell to 2014 levels. The authors attribute this decline in part to rising vehicle prices, which have deterred consumers from buying. WSJ