Share this page!

Diane Swonk Profile picture
Twitter logo
24 Mar, 5 tweets, 2 min read
@mckonomy hit the conflict that will get the most news in the @SecYellen hearings. Concern that funding for IMF will be abused and cost close to $200b. Yellen doesn’t tolerate factual omissions by Senators. The program in question pays interest to US and is a “wash” in her words
As expected, concern about inflation more intense in Senate testimony for Powell and Yellen than in their House testimony yesterday. Powell did a good job of explaining the need to raise participation & why that is so crucial at this time.
Powell & co at Fed seem more worried about how fast employment rebounds than Yellen. Gov Brainard cited the CFO survey that revealed half of companies either replacing workers with automation or hoping to in next year. The crisis accelerated adoption of existing tech.
We are in uncharted waters with COVID rebound. Pent-up demand for discretionary services is large and, to borrow a phrase from @EllenHughesCrom, “boomy.” Harder to reopen than close capacity. GDP recovers faster than employment. Price spikes likely as bottlenecks inevitable.
Many of the long-term trends - tech, shift to online retail, streaming, automation, AI, global disinflation, aging populations - where accelerated by pandemic. Fed is not convinced a boom fueled by current fiscal policy is enough to reverse what those trends mean for inflation.

• • •

Missing some Tweet in this thread? You can try to force a refresh
　

Keep Current with Diane Swonk

Diane Swonk Profile picture

Stay in touch and get notified when new unrolls are available from this author!

Read all threads

This Thread may be Removed Anytime!

PDF

Twitter may remove this content at anytime! Save it as PDF for later use!

Try unrolling a thread yourself!

how to unroll video
  1. Follow @ThreadReaderApp to mention us!

  2. From a Twitter thread mention us with a keyword "unroll"
@threadreaderapp unroll

Practice here first or read more on our help page!

More from @DianeSwonk

Diane Swonk Profile picture
27 Mar
There are a couple things worth pointing out about the labor market. We were still 9.5 million jobs in the hole in Feb - 7.1 M in services, 1.3 mill state & local (mostly education) & 1M elsewhere. A surge in spending on goods helped recoup activity in mfg and construction.
High wage job gains have not only recouped what was lost but are above prepandemic levels. That left pockets of labor shortages. Loss in immigration - largely high skill legal - exacerbated problems. Immigration fell 40% 2016-19 & hit wall in pandemic. Not easy to reverse.
The situation for low-wage workers remains much worse. The @federalreserve has cited the unemployment rate of the low quartile of wage earners at more than 20% - a depression level. The emergency aid and stimulus have - intermittently - replaced incomes but not jobs.
Read 13 tweets
Diane Swonk Profile picture
27 Mar
I have been looking into studies on mental health and the pandemic. There are a lot. Welcome suggestions on more. The worst outcomes globally are among those who also suffer the worst in economic stress but they go well beyond that, notably in young adults.
The moral & economic toll is large and broad based. Stress and mental health can undermine productivity, have broad based consequences on health, the cost of health care, further stress an already stressed health care system. It can undermine current and future earnings.
The result of poor mental health flows downhill to children, whose well-being is compromised. Vicious cycles can take hold I. families & communities hardest hit by the pandemic. Inequality is exacerbated, which undermines the overall potential of economies to grow.
Read 5 tweets
Diane Swonk Profile picture
26 Mar
Personal incomes & consumer spending lost ground in February after surging on the heels of stimulus checks in January. Harsh winter weather and electricity outages across the whole state of Texas exacerbated the losses. But, the underlying trend is stronger than a month ago.
Consumer spending for January was revised up, suggesting that consumers spent even more of their last round of stimulus checks than previously thought and another, more generous round was issued in March. The last plan upped checks to $1400 from $600 to get to $2000 total.
Preliminary data on March is looking extremely good. Air travel hit its highest level in over a year in March as travel triggered by spring break, a lifting of restrictions, stimulus checks & the fact that the majority of those over 65 are now fully vaccinated spurred demand.
Read 15 tweets
Diane Swonk Profile picture
25 Mar
This research is so important as it shows that a lack of in-migration during the pandemic played a larger role than out-migration when looking at shifts in of large urban centers during pandemic. It also correlates with a surge in young adults moving back in w their parents.
Young people did suffer disproportionate layoffs. A smaller group who could work-from-home moved back in w parents for space, safety & to save on rents. Anecdotal reports from Chicago suggest that the downdraft in luxury apt rents has bottomed; apts are being snapped up faster.
Some hybrid of work-from-home is inevitable - many companies were already moving in that direction pre pandemic. That does change downtown dynamics but doesn’t eliminate the value of downtown space. Cities have a lot of amenities and chances for collaboration.
Read 6 tweets
Diane Swonk Profile picture
21 Mar
Some thoughts on inflation. Bond market participants rode a multi-decade deceleration in inflation. That came at a cost over last two decades as wages decelerated as well. Some of gap between men and women was closed bc male-dominated (mfg & construction) jobs fell.
The Fed has shifted its stance on inflation. It has said 1) It would “look through” - not raise rate later - a transitory flare in inflation. This will come in 2 ways - inflation measures get easier to beat, starting in Mar, as prices decelerated/dropped as crisis hit yr ago.
The Fed shouldn’t be curbing the recovery to contain inflation that is a result of a technicality triggered by the crisis. It should abate. However, just as those “base effects” as they are called play out as we move into summer, we could see flare in prices tied to reopening.
Read 11 tweets
Diane Swonk Profile picture
20 Mar
These kind of slights compound. They cause too many and, devastatingly, some economists to conclude women are either not good enough to do what they do and draw the crowds to games. When, in reality, they are being held to a higher standard with fewer resources to achieve.
The result is an economy that is grossly inefficient and growing much less than it could if all its potential were unleashed. Leveling the playing field, in this case, would ⬆️ the competitiveness of the game, enhance earning power and boost the economy.
Leveling the playing field would also create more role models for girls that they can succeed in different ways. In that way, leveling the playing field pays it forward. There’s a reason that the first thing developing economies do to develop is to ⬆️ opportunities for women.
Read 5 tweets

Did Thread Reader help you today?

Support us! We are indie developers!

This site is made by just two indie developers on a laptop doing marketing, support and development! Read more about the story.

Become a Premium Member ($3/month or $30/year) and get exclusive features!

Become Premium

Too expensive? Make a small donation by buying us coffee ($5) or help with server cost ($10)

Donate via Paypal Become our Patreon

Thank you for your support!

Follow Us on Twitter!

Like this author's thread?

Get emails when @DianeSwonk has new unrolls!

Check out other threads from @DianeSwonk!

Read all threads by @DianeSwonk