Tag Archive: Okun’s Law

Labour Productivity, Taxes and Okun’s Law

2016-09-04

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2016-09-04

The great “science” of economics once discovered an empirical relationship between GDP and unemployment that has been dubbed Okun’s Law. It simply states that the unemployment rate rises as GDP contracts, or vice versa, as production shrinks less peo...

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Bernanke’s Advice: More Emphasis on Data, Less on Fed Guidance

2016-08-09

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2016-08-09

Bernanke reviews the changes in the long-term dot plots. There as been a clear trend toward lower long-term growth, unemployment and Fed funds equilibrium. The full adjustment may not be over.

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What Drives Government Bond Yields?

Private, Financial, Government Bond Debt
For us the five major drivers of government bond yields are: Inflation expectations and inflation: The by far most important criterion. High inflation expectations must be compensated via higher bond yields. The main driver behind inflation expectations is the wage development, this is the form of inflation that typically persists. Price inflation follows inflation expectations with a certain lag. Wealth: The higher the wealth of a country, the...

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The “Sell in May, Come Back in October” Effect and the 19 Fortune-Tellers of the FOMC

2013-04-03

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2013-04-03

fortune tellers
The U.S. economy regularly improves between October and April, this year additionally fueled by "unlimited" quantitative easing, weaker gas prices and higher competitiveness thanks to a stronger Chinese yuan and weaker Asian economies.   Update 2013: The Case-Shiller index continued to climb in April 2013; it became clear that this year the "Sell in May" …

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Mainstream Economics , The Medium Run

Blanchard Macroeconomics 6th edition


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The “Sell in May, come back in October” effect and its equivalent for the SNB

2012-06-09

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2012-06-09

Sell in May, Come back in October
  The "Sell in May, come back in October" effect It is the same seasonal anomaly nearly every year: The statistically flawed (see here and here) Non-Farm Payrolls (NFP) report delivers some good winter readings with 200K new jobs, this time additionally fuelled by a weather effect; biased data that let hard-core Keynesian policy makers doubt Okun's law. Consequently the stock markets rally …

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