krugman.blogs.nytimes.com - 1/7/2009
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Mind the gap
1. The new CBO budget and economic outlook is out. Above is its forecast for the GDP gap - the hole stimulus has to fill. I'd guess that the CBO estimate, which has unemployment averaging 8.3 percent in 2009 and 9 percent in 2010, is actually too optimistic (see 3, below), but even ...
krugman.blogs.nytimes.com - 1/6/2009
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krugman.blogs.nytimes.com —
Bit by bit we're getting information on the
Obama stimulus plan, enough to start making back-of-the-envelope estimates...
of impact. The bottom line is this: we're probably looking at a plan that will shave less than 2 percentage points off the average ...
(more)
Stimulus arithmetic (wonkish but important)
becker-posner-blog.com - 1/12/2009
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becker-posner-blog.com —
If the government increased its spending on infrastructure
when the economy has full employment, its main impact...
would likely be to draw labor, capital, and raw materials away from various other activities. In effect, increased government spending ...
(more)
On the Obama Stimulus Plan-Becker
econbrowser.com - 1/3/2009
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econbrowser.com —
In my previous post , I presented evidence
that the oil price increase over 2007:H2-2008:H1 made a...
significant contribution to the slowdown in consumption spending in general and decline in spending on domestic automobiles in particular. Here I ...
(more)
The oil shock and recession of 2008: Part 2
Comments
Blog Reactions
Budget Deficit... Overly Optimistic and Still Ugly
EconomPic —
... However, this is based on what seems to be highly optimistic economic growth. Real GDP is projected to be a little below -2% in 2009, then snap back to 1.8% by 2010. I don't buy these numbers and Paul Krugman details why this projection is overly optimistic based on the estimated GDP Gap and stimulus plan stated (bold is me). ...
CBO's Projected Output Gap
Econbrowser —
... output gap will be comparable to that of the early 1980's. The output gap is more persistent than that of the 1980's, implying a larger cumulative output loss. Hence, the projected recession will also be quite long, as the trough is projected for 2009Q3. The peak-to-trough period from 2007Q4 to 2009Q3 is seven quarters, and would constitute the longest recession since the Great Depression (1929Q3-1933Q1) (see NBER).
Update: 9:20pm Pacific Oops, I was scooped by Paul Krugman.
EconomPics of the Week (1-09-09)
EconomPic —
... Writedowns GMAC chairman resigns effective immediately Dealbreaker Write-Offs: 01.09.09 Fixed Income « Abnormal Returns Friday links: contango conditions How the World Works - Salon.com Is Obama aiming too low? Investment Postcards from Cape Town Video-o-rama: Figuring out the lie of the financial land Naked Capitalism Rubin Resigns from Citi; Bank to Sell Smith Barney Paul Krugman More stimulus notes The Big Picture Al Franken Does Mick Jagger WALL STREET ...
Is the US overestimating its “potential”?
The visible hand in economics —
... has released their forecasts (ht Paul Krugman). It is an ugly sight, as would be expected, with growth falling miles below its “potential” level and a large negative output gap opening up. ...
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What Does Fiscal Stimulus Mean?
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U.S. GDP
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