Archive for February 2025

The Friday File: In 1983, Alexa was the 745th most popular name with about 200 girls receiving it. It then steadily rose, peaking in 2006 at 39th most popular, with over 6,100 girls given the name. By 2014, when Amazon introduced Alexa, it was the given name of 4,000 girls. It oddly spiked to 6,000…

A recent Home Street report finds climate change will reduce US home values by $1.47 trillion by 2055. Some perspective please: while $1.47 trillion sounds enormous, the current value of US residential property is $52 trillion. If home values rise by 3.75%/year, which is low, that would make the residential stock worth $156 trillion in…

In the first four months of FY25, the budget deficit totaled $838 billion; $306 billion more Y-o-Y. Revenues were $11 billion higher, outlays were $317 billion higher. But some of the increase was due to calendar effects. Absent them the deficit would have been $750 billion. Despite the large rise, the CBO still projects the…

By reducing US demand for imports, tariffs reduce the supply of dollars flowing to foreigners. That reduced supply raises the foreign exchange value of the dollar. While a stronger dollar reduces inflation, it makes US exports more expensive. This partly offsets some of the benefits of the tariffs. To reduce imports but boost exports a…

January net job growth was a decent 143,000, Nov/Dec were upwardly revised by 100,000, and the unemployment rate fell to 4%, its best level since 5/24. But the workweek slid to 34.1 hours, the lowest reading since 3/20, and quite surprisingly, wages rose a very strong 0.5%. I suspect the Fed keys in on the…

The Friday File: Coffee futures just touched a new all-time high, almost $4/pound, foreshadowing significant consumer pain in the coming months. It’s because Brazil is coming off a lousy crop. And with wholesale eggs at over $7/dozen, breakfast may now be the most expensive meal of the day. But there is relief in sight. Pork…

Pending home sales slipped 5.5% M-o-M in December and slid 5% Y-o-Y. This isn’t surprising, given the nearly one percentage point rise in 30-year mortgage rates since the recent low of 6.08% for the week ending 9-26-24. Moreover, absent seasonal adjustment, the Pending Homes Sales Index is at its lowest since 2001 when the NAR…

While the Fed’s favorite inflation measure came in at 0.2% for December (the unrounded number was 0.156%), the six-month rate is running at 2.3%, and the three-month at 2.2%, very close to the Fed’s 2% target. Better yet, while labor compensation was up 0.9% Q-o-Q, and 3.8% Y-o-Y, with productivity growing at about 2%, compensation…

While 24Q4 GDP came in at a slightly disappointing 2.3% annualized rate, down from 3.1% in 24Q3, and 24Q4 expectations of 2.6%, consumer spending, which represents almost 70% of GDP was up a very strong 4.2%. Moreover, the Fed’s favorite inflation measure, core PCE, came in at a bond friendly 2.5%/annum. Much of GDP weakness…

While US exports to Canada and Mexico are both about 1% of GDP, or $315 billion/year, do not be dismissive. Canada accounts for 60% of all US crude oil imports, about 3.8 million bbl/day. As for Mexico, they account for 23% of total US food imports. This includes 63% of vegetables, and 47% of fruits…