The Italian Runaway Train

There has been lot’s of debate in the press and in academic circles over the last week or so about whether Italy’s latest contraction constitutes a triple dip recession or simply a continuation of what’s been going on over many many years. This is an interesting theoretical nicety, but in fact what is happening in […]

Confessions of an Inflation Truther

There is a group of folks who believe that inflation is much higher than the numbers in the official reports. Paul Krugman calls them “inflation truthers.” In the 2000s, I might have been considered part of that crowd. I recognized that inflation data wasn’t being reported accurately, and said as much. I coined the phrase “inflation ex-inflation” […]

Euro Area – Q&A on QE

By Reza Moghadam and Ranjit Teja: As inflation has sunk in the euro area, talk of quantitative easing (QE)—and misgivings about it—have soared. Some think QE is not needed; others that it would not work; and yet others that it only creates asset bubbles and may even be “illegal.” In its latest report on the euro area, the IMF assesses […]

Great Graphic: Disinflation or Deflation in Europe?

This Great Graphic appeared was posted by Alen Mattich at the Wall Street Journal.    The red bar shows the average CPI in the 2000-08 period.  The blue bar shows the latest inflation. That was before today’s reports.  These include France, where the year-over-year rate in June slipped to 0.6% from 0.8% and the Netherlands, where the year-over-year rate ticked […]

Yellen vs. Bullard on Wages and Inflation: Who Is Right?

Wage growth is “not a threat to inflation,” Fed Chair Janet Yellen said on June 18.  “[With] our 2 percent inflation objective, we could see wages growing at a more rapid rate” before having to worry. “When unemployment goes into the five range, that is going to below the natural rate,” St. Louis Fed President James Bullard […]

Imminent Wage Increases in Sight for U.S. Workers?

How tight is the labor market? A recent article summarizes the argument that wage pressures are building. From K. Madigan in WSJ Real Time Economics: Economists now are debating whether the Fed has set its Nairu sights too low. And they point to two reports out Tuesday as proof. The first report was the small business survey done […]