The curious behavior of M2

Found something interesting in the course of doing my day job. Check out M2 (since 1995) against its trend:

Could higher interest rates help the economy?

We live in an age when central bankers grace magazine covers like pop stars. But what if they don’t actually know what they are doing? In the United States, at least, quantitative easing and low short-term interest rates may have done as much harm as good.

 

The January Jobs Numbers

Last Friday, the Bureau of Labor Statistics released its report on the employment situation for the month of January. According to the payroll survery, 257,000 private-sector jobs were created in the first month of the year. Moreover, revisions added the number of people working in previous months. According to the household survey, the unemployment rate dropped from 8.5% to 8.3%. The news is positive but the magnitude of the change is still too small to affect the overall jobs outlook, which remains pretty miserable.

The December employment report

On Friday, the Bureau of Labor Statistics released its report on the December Employment Situation. According to the payroll survey, the U.S. economy added 212,000 private sector jobs in December. Since the trough in February, 2010, an average of 144,000 private jobs have been added each month, so one might think that the recent performance is a substantive improvement. But this growth is barely sufficient to keep up with the growth in the population. Meanwhile, the household survey indicated that the civilian unemployment rate fell from 8.7% in November to 8.5% in December, although, as we shall see, there is far less in those numbers than first meets the eye. Some analysts have gone so far as to say that this is the beginning of a significant recovery. They are mistaken.

Links 1/4/2012

Links 12/16-18/2011

Links 12/15/2011