Very basic view of monetary policy and inflation, and why rate hikes could, under certain conditions, cause inflation. (And why rate cuts would actually be deflationary under the same conditions) Inflation is caused by above potential GDP. Eg, the economy is at capacity, so any

Despite the media buzz over #China’s “renewables,” the real story is China’s economy still runs on coal and it’s not slowing down. In 2024, China consumed more than half of all #coal burned worldwide—nearly 4.9 billion tonnes. That dwarfs every other country. And it’s not just

#Coal is still king. In 2023, the world consumed 620 EJ of energy—fossil fuels made up 81% of it. Breakdown: 🔴 Coal: 32% ⚪ Natural Gas: 26% 🟠 Oil: 23% 🟢 Renewables + Nuclear: just 19% combined. If we’re serious about the energy transition, the gap should close fast.

Tangentially related is this very classic Steve Jobs story

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Core inflation was above expectations and had its highest print since January. But I don't think that really conveys how much more elevated it is in 2025, as shelter disinflation continues to cover up higher services and goods. This is worrying. Let's dig in: /1

Excellent new Michael Cembalest note on the healthcare sector, which up until 2020 had performed just as well as the tech sector in the stock market, but has since moved sideways. assets.jpmprivatebank.com/content/dam/jp…

You can either argue 1) tariffs raise consumer prices but because theyre a one-off and the labor mkt is weakening, the Fed can still cut Or 2) tariffs are not inflationary. In which case inflation looks stuck nearly 1% above target. Not great case for cutting…

This is a really good slide from Cisco’s investor presentation

Today I learned that nature has evolved different species into crabs at least five separate times - a phenomenon known as Carcinisation There are many scientists that think it likely that a good portion of life elsewhere in the universe will resemble crabs and spiders.

From the Financial Times’ article, “How the West got hooked on economic support: Crisis firefighting has given way to dependence on governments and central banks.” #economy #markets @ft

The best piece of often overlooked advice that I got at rentech (by Jim himself) in the earlier days was : “Always remember, first sort, then regress”. We lived by this rule. If you have data (X,Y) sort X and Y independently, this gives a better fit.

My latest in The Economist: on America's data-centre boom. Vast short-run impact on GDP growth: — Accounts for ~1/6th of growth over the past year — And ~1/2 of growth over the past six months But: so far still much smaller than the 1990s dotcom buildout. And...

You might think a property tax is a simple thing: the government takes 2% of your house. You would be wrong! The govt takes 2% of your house every year. Adding up, around 25% of the present value of US houses is collected in taxes! This number ranges from 0 to 75% across places

My favorite deep learning intuition is that neural net layers are a series of geometric transforms

Surround yourself with lawyers who will do shit like this

A very hopeful paper for industrial policy. In a distorted economy, there’s no guarantee that correcting a distortion in any one sector raises total output. Liu is able to show that, in a network and under reasonable restrictions, targeting upstream sectors is always good. 1/

Per the Urban Institute, the federal government spends about $5 on seniors for every $1 it spends on kids. Between all levels of government, seniors get twice as much.

10y yield telling you that fed cutting here is not a policy mistake. Historic rule of thumb is that every 25 bp FFR cut lowers: -2y by 17 bps -10y by 10 bps -7 bp bull steepener Curve is normal now and this move is almost exactly what you would expect imo.