Economics: On a month-to-month Supercore PCE inflation index-basis, the soft landing happened a year ago, with
And even on a past-year basis there is no inflation “resuming” a downward trend if you look at core inflation measures, either CPI or PCE. Inflation has been on a steady downward trend since mid-2022, according to core trailing-year averages.
Augusta Saraiva: US Inflation Broadly Cools in Encouraging Sign for Fed Officials: ‘The so-called core consumer price index — which excludes food and energy costs — climbed 0.2% from April, Bureau of Labor Statistics figures showed. The year-over-year measure rose 3.4%, cooling to the slowest pace in more than three years…. The figures… may represent the early stages of inflation resuming a downward trend. But policymakers have stressed that they’d need to see several months of price pressures receding before they consider lowering interest rates…. Stock futures and Treasuries rallied across the curve, pushing both two-year and 10-year yields down about 14 basis points. Traders fully priced in two rate cuts by the Fed this year, with the first move coming in November — two days after the presidential election… <https://www.bloomberg.com/news/articles/2024-06-12/us-inflation-broadly-cools-in-encouraging-sign-for-fed-officials>
Inflation: CPI, Core CPI, & Supercore PCE:
Journamalism: Sundowning in America. Just think if Joe Biden were to go on a demented incoherent ramble like this just one time:
Donald Trump: ’It must because of MIT, my relationship to MIT, very smart, he goes, I say, “What would happen if the boat sank from its weight, and you’re in the boat, and you have this tremendously powerful battery, and the battery’s now under water, and there’s a shark that’s approximately 10 yards over there?”—by the way, a lot of shark attacks lately, do you notice that? Lotta shark attacks—I watched some guys justifying it today, ‘Well they weren’t really that angry, they bit off the young lady’s leg because of the fact that they were, they were… not hungry but they misunderstood who she was.’ These people are crazy. He said, ‘there’s no problem with sharks, they just didn’t really understand a young woman swimming,’ no, really got decimated and other people too, a lot of shark attacks.
So I said, ‘There’s a shark 10 yards away from the boat, 10 yards, or here. Do I get electrocuted if the boat is sinking, water goes over the battery, the boat is sinking? Do I stay on top of the boat and get electrocuted or do I jump over by the shark and not get electrocuted?” Because I will tell you, he didn’t know the answer. he said, “You know, nobody’s ever asked me that question.” I said, “I think it’s a good question. I think there’s a lot of electric current coming through that water.”
But you know what I’d do if there was a shark or you get electrocuted? I’ll take electrocution every single time. I’m not getting near the shark. So we’re going to end that, we’re going to end it for boats, we’re going to end it for trucks… <jefftiedrich.com/p/donald-trump-is-a-gi…>
Edmund Fawcett: What happened to liberal conservatism?: ‘Conservatism… myth. Since the late 19th century… a golden but conflicted promise: flourishing capitalism and social stability. Capitalism… generate[s]… wealth… [by] forever turns society upside down. Conservatives… must be… circus-riders… with one foot on a pony called “Capital” and the other on a pony called “Tradition”…. It’s worth recalling how well in electoral terms conservatives have turned the trick…. Since… 1949, Germany’s Christian Democrats have shared or held office for 52 of those 75 years. France’s… 39 of the past 65 years—46 if you include… Macron…. In Britain… in the past 110 years, the Tory party has held or shared office for 76 of them…. Skills wear out…. Runs come to an end…. The hard right… free-market globalists, national welfarists and ethico-cultural traditionalists…. Popular anger and disbelief at liberal democracy’s repeated failures to answer the insecurity and inequities brought about by massive structural changes from globalisation… a largely invented but rhetorically powerful enemy, the liberal elite… <https://www.ft.com/content/21cebba5-8dfd-4cf8-ad3d-ae1f4a81d9cc>
Public Reason: John Quiggin seems to have missed my point. Neither my point nor Noah’s was part of a motte-and-bailey argument:
John Quiggin: The Left and THE LEFT: ‘Rather, I’m interested in the following remark…. ”How has the left been doing with its baton? Not well at all, for anyone who defines ‘THE LEFT’ to consist of former Bernie staffers who regard Elizabeth Warren as a neoliberal sellout.” This is a classic, indeed brazen, motte-and-baileyin which the hard-to-defend bailey “the Left of the Democratic party (of which Elizabeth Warren is a prominent member) is doing badly” is replaced by the motte “THE LEFT (as represented, in this case, by disgruntled former Bernie staffers) is doing badly”. It’s one which I’m seeing increasingly from the group I’ve called “soft neoliberals”, and who are increasingly reclaiming the term “liberal”, though usually in less blatant forms…. We have seen the emergence… of a substantial political grouping which is neither centre-left, in the neoliberal sense, nor LEFT in the Marxist-Leninist sense…. I will just use the term “the left” to describe this group. The left poses two problems for soft neoliberals. First, it represents a plausible political alternative…. More fundamentally, perhaps, the left poses a challenge to interpretations of liberalism in which the political right (unlike THE LEFT) is treated as a legitimate interlocutor…. Unsurprisingly, the easiest response for soft neoliberals is to ignore the left and to focus on some version of THE LEFT which can be characterised as authoritarian and illiberal… <johnquigginblog.substack.com/p/the-left…
My point was precisely that THE LEFT defined as “former Bernie staffers who regard Elizabeth Warren as a neoliberal sellout” not just dropped the baton, but doesn’t have any idea what to do with a baton or even that there is a baton. My point was that the baton is now held by “ex-left-neoliberals and nearly all other right-thinking Americans… [defining themselves as] supply-side progressives”, and that we will win or loose in actually doing stuff via the government depending on whether or not we can get enough people further right to define themselves as supply-side Americanists and join us.
As we said in our podcast, agreeing with each other:
Noah Smith: “I would argue that Elizabeth Warren’s ideas were the the progressive ideas that became policy in the Biden administration— that was the “left” that actually ended up making policy… that David Austin-Wells now hates…”
Brad DeLong: “if you view ‘passing the baton’[as] meaning that the center of gravity and ideas in the Democratic Party is no longer someone like Manchin or—shudder—Lieberman, but is instead Elizabeth Warren, then I would say the baton has been passed [to the left, and that] the passing of the baton has been substantially successful. A remarkable amount of stuff has been done, largely because of the breaking under the Biden administration of High Mitch McConnellism. of Republican senators… united around… block[ing] everything in the hopes of making the Democratic president look like a weak failure.” <braddelong.substack.com/p/podcast-hexap…>
Economics: Payroll-concept employment increased 272,000 in May with employment growth spread widely. Household-concept employment fall by 400,000 with unemployment up to a 4% rate. The fear is that the new-firms factor in the payroll estimate is going very wrong right now: that firm creation in May collapsed, and so the payroll estimate is adding in a bunch of new workers whose Social Security payments have not yet hit the system because their firms are just starting up, and those new workers simply are not there. This worry is real. IMHO, it is enough to more than justify a rate cut this month.
The Council of Economic Advisors, however, sees this as a footnote, and focuses overwhelmingly on the very strong payroll report. Reading between the lines, I think they dismiss this as something going wrong with summertime seasonal adjustment as young workers this year are late picking up their summer jobs. But I have not dug into this yet to figure out if that is actually true:
CEA: ‘Today’s employment report shows the U.S. economy added 272,000 jobs in May, well above expectations. Revisions to prior months’ estimates were relatively small on net. Through May, the average three-month gain in payrolls was a very healthy 249,000.
Employment gains were widespread across industries, but were led by education and health, government, and leisure and hospitality sectors….
The labor force participation rate (LFPR) fell 0.2 ppt to 62.5% and employment-population (EPOP) fell by 0.1 ppt to 60.1%. These declines were likely driven by young workers 16-24, whose EPOP fell by 1.2 ppt. Hhold. employment fell 456,000 when adjusted to payroll-survey basis. The figure shows a few recent months where these two series have similarly diverged. Analysts consider the payroll survey to send a more reliable signal with a 90% conf int of 130K compared to hhold’s 620K… <https://x.com/WhiteHouseCEA/status/1799067190244831553>
