Betsey Stevenson

The Fed can't be dovish or hawkish right now, they have to be doggish--data doggish that is. nytimes.com/2025/07/02/b...

And I am puzzled why, at the dawn of artificial general intelligence, we are knee-capping ourselves, giving our international competitors a fighting chance at beating us in the AI game.

What I worry about is whether these tariffs cost us American service jobs--all of the workers involved in business and professional services that support companies that import goods. Fewer goods sold mean fewer business services needed.

American is a service-based economy: Let's take a look at job growth in private sector goods and services over the past 75 years. Spoiler: it's almost all in services. We are not going to even make a dent in this trend. In fact, we may push it further.

Tariffs are not going to mean that we have more goods-producing jobs in the US. What they will do is change the relative price of goods versus services, pushing Americans to buy fewer goods relative to services. If you are worried about American overconsumption of stuff, then hooray! 🧵

The United States GDP per capita is 20 times great than it was at the start of the Guilded Age. And yet so many in power remain just as insensitive, greedy, and detached from the realities of poverty and suffering. Imagine getting that much richer and not using any of it on empathy.

This fun, creative contest seriously highlights how hard the entire Planet Money team works to communicate economics in a way that both educates and entertains.

The public needs to hear this over and over again: work requirements are not about getting Medicaid recipients to work. It’s about increasing the administrative burdens and costs in the system to push both recipients and the program itself to the breaking point.

You might be getting bored of tariff talk but the rubber is going to hit the road in the coming months as price increases hit. Walmart tells investors that it's raising prices later this month. And inflation expectations have shot up a shocking amount in the Michigan consumer survey released today.

If they really wanted to incentivize work, they would require married stay-at-home moms to work. The second earner effect is their best chance for a work requirement to influence work at all. There is no first earner impact.

Walmart might not raise every price by the amount of the tariff, but they aren't going to let their profitability suffer. Their shareholders demand profit maximization and that means passing along tariffs to the fullest extent possible without losing too many sales.

On @allinwithchris.bsky.social @chrislhayes.bsky.social asked me why tariffs will raise prices if a higher minimum wage doesn't always lead to higher prices.

The answer: People are not things. They respond to a change in their compensation, a sippy cup doesn't.

It's true. President Trump is forcing economists to rewrite their textbooks. #TeachEcon @betseystevenson.bsky.social

Thank you!

Thank you!

Thank you!

And now Walmart is telling us definitely higher prices in June. Just because there aren’t problems in the hard data yet, doesn’t mean that they aren’t forecastably coming.

My concern is that we'll see a weaker employment report in June and July, of course the labor market was strong in April. That report measured the weak after liberation day and despite the shock of Trump's tariffs, employers aren't going to shed workers that quickly.

I didn't post my NBC Fed preview before the press conference. Luckily my preview was exactly what they did and said.

Reporters seem to think that the only direction for rates to go is down, but Powell shuts that assumption down by saying "once you have a clear direction"

Rates could go either way people!!! It depends on what happens with inflation.

It matters for setting off ongoing inflation because inflation gets baked into contracts, etc. But agree that Trump is risking ongoing inflation through this tariff inflation bump.

The Fed can wait because they can't change a decline in supply due to the distruption in imports. They can try to decrease demand for that reduction in supply to help reduce inflationary pressure, but they can't create jobs to make up for those lost due to the reduction in imported goods.

Powell made a pretty strong case for why the Fed has to ensure that the one time price increase caused by tariffs doesn't cause inflation expectations to become unanchored.

Nothing Powell said is surprising, this is the sensible decision making of a balanced and reasonable group of monetary policy makers who are walking a tight rope.

Powell: data is not clear what they should do.

Bottom line is that wages are good, job creation is fine, layoffs are normal, and consumer demand shows no sign of slowing.

The problem: the crash to businesses from tariffs is coming and there is nothing the Fed can do about it.

Powell once again refuses to comment on Trump or Trump's ability or desire to fire him. So smart. You won't get any headlines beyond monetary policy out of Powell. His comms team is 🔥🔥

"They don't need our advice on fiscal policy any more than we need their advice on monetary policy."😂😂🔥🔥

There is no evidence or even a hint of a suggestion that the data is being manipulated. It is normal statistical process to count people still receiving pay among the employed.

Yesterday I said that a slowing job market doesn't start with a monthly jobs report that shows a dramatic drop in jobs added, it starts with a slowdown in openings being posted (which we are seeing). This jobs report shows an economy that is still strong, but that doesn't mean that it is stable.

Can Donald Trump Get Americans to Make More Babies? There’s an important conversation to have about fertility rates. It doesn’t look like this.

“I don’t worry about fertility as in, ‘We have got to fix fertility.’ I worry that American families are not thriving, and one symptom of that is we can see them having fewer children.”

-- @betseystevenson.bsky.social

www.thebulwark.com/p/can-donald...