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The Federal Reserve Bank of St. Louis is the center of the Eighth District of the Federal Reserve System. This District includes Arkansas, eastern Missouri, southern Illinois and Indiana, western Kentucky and Tennessee, and northern Mississippi.

FRED

Taking the time to measure money : A closer look at broad money in the U.K.

[embedded content] The FRED graph above, which tracks broad money in the U.K. over the past 172 years, makes it look like the Bank of England has let the money supply go completely out of control since 1970. But not so fast! Two important effects are at play here. The first is the power of compounding: Any statistic that increases at a constant rate will look like it is accelerating, especially if the sample period is long. That’s why FRED graphs offer the option of taking the natural...

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The stock market is not the economy : Taking a “random walk” through the data

[embedded content] Does the stock market tell us anything about the economy? The stock market seems to react continually to various data and economic news, and many of us follow its day-to-day changes, especially if we’re invested in it. But do fluctuations in the stock market actually reflect economic health? The best measure we have for measuring total economic activity is GDP. But GDP is measured only quarterly and with a considerable lag. With the help of FRED, though, we can look...

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Paychecks at the top, at the bottom, and in the middle : A look at the distribution of wage income

[embedded content] Let’s consider the topic of income disparity by looking at some data from our friends at the Bureau of Labor Statistics—or, as we like to call them, the BLS. (Just to clarify: Top incomes are increasing more than others not so much because of regular labor income, but largely because of capital income, various bonuses, and the like. That said, in this post we’ll stick with the distribution of regular wage income.) The BLS’s Current Population Survey provides weekly...

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The give and take of technology : Changes in U.S. imports and exports of intellectual property

[embedded content] The U.S. creates many technological innovations that the rest of the world wants to use. The FRED graph above tracks how much technology the U.S. exported to the rest of the world from 2002 to 2018 (blue line), as measured by payments the world made for the use of U.S. intellectual property (IP). These payments, in the form of royalties and licensing fees, increased from $67 billion to about $118 billion, showing that the U.S. has substantially increased the knowledge...

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Capital’s gain is lately labour’s loss : The global decline in the labour share of income

[embedded content] The GDP of a country reflects, among other things, the total payments to all factors of production. For a long time, the share of payments to labour* relative to total payments to all factors of production was relatively stable. In recent decades, the share of payments to labour has been trending down in many countries, which FRED can help us illustrate. The first graph shows that the share of labour compensation in GDP has been declining for several countries around...

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Live by the barrel, die by the barrel : Connections between oil production, oil dependency, and economic growth

[embedded content] In every introductory macroeconomics course, oil is used as the classic example of a negative price shock. Professors tend to discuss the 1973 oil price shock triggered by the Arab-Israeli conflict and the 1979 oil price shock caused by the Iranian Revolution as reasons for rising inflation and falling global output—connecting these shocks to models about investment and aggregate supply and demand. More recent literature, including this presentation by St. Louis Fed...

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Switzerland’s mountainous monetary base : More Swiss uniqueness on their national holiday

[embedded content] Today is the Swiss national holiday. In the past, we’ve taken this opportunity to discuss some unique (i.e., weird) feature of the Swiss economy. This time we use FRED to compare the Swiss monetary base with the U.S. monetary base. To make them comparable, we divide each by its country’s nominal GDP. We see that the general patterns are similar, with a sudden increase in 2008. While the U.S. monetary base has started to go back down (it’s lost a quarter since its high...

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What can we claim about initial claims? : Keeping track of initial unemployment insurance claims

[embedded content] Initial unemployment claims is a much-watched indicator of the economy. It counts how many people have become eligible for unemployment insurance compensation in a particular week. The data are available quickly and at a high frequency (weekly), but the series has the disadvantage of being highly volatile. This is why FRED also offers a four-week moving average, shown in the graph above: Simply, it’s the average of the past four weeks. Included in the graph is also a...

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A mirror image of mortgages and equity : The story of the Great Recession told with two intersecting lines

[embedded content] Take a look at mortgage or real estate data on FRED. The main story (for a number of years, now) is all about the Great Recession, which is clear in the graph above. Let’s unpack that story. In blue, we have the share of equity in the real estate that households own. In the 1950s, 70-80% of the value of the average house was owner equity, and 20-30% was owned by a financial institution. The share of owner equity essentially stayed within a 60-70% band until the end of...

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The importance of imports : Import tariffs, imports of production inputs, and domestic investment

[embedded content] U.S. trade policy continues to change, with rising tariffs on imports of capital goods and intermediate inputs from China and other countries. But how important are these types of imports for the U.S. economy, especially compared with total U.S. imports? As usual, FRED can help answer our question: The graph above plots the share of capital and intermediate inputs in aggregate U.S. imports over the period 1999-2019. As the graph shows, the share is not small. In fact,...

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