Showing posts from August, 2020

Riding on a high: why is the market hitting records in a recession?

The US National Bureau of Economic Research (NBER), the official tracker of the US business cycle, declared that the recession in the country started in February 2020. According to NBER February was the peak of the business cycle as jobs already started disappearing (even though the huge COVID-driven unemployment claim spikes didn’t happen until mid-March). Over the next month and a half over 42 million Americans found themselves out of work. The official unemployment rate shot up to 14.7% in April (it was 3.5% in February), and has declined back to 10.2% in July, as a more encouraging sign of a recovery driven by business re-openings.
Due to the effects of COVID-19 the uncertainty in the economy is still huge, and is still the biggest it has ever been according to the Economic Policy Uncertainty Index. Almost every graph we see during the pandemic has a label “unprecedented” attached to it; we are usually looking at a very steep exponential curve facing up (for unemployment, uncertain…

Welcome to The Political Economist

It's been almost three years since I last wrote anything on my once very active blog. I stopped producing regular content by mid 2014, dropped down to 2 posts per month in 2015 (down from over 10 posts p/m in the years before that) and even though I picked it up again in 2016 with my series of book reviews, by 2017 the blog was basically dead. 
Reasons? I have two kids now, I've finished a PhD at Oxford, and I'm running a company that I co-founded. So yeah, bit busy. I've still been writing. In fact, now more than ever (papers are getting published, the PhD is finished, working on a book project, business stuff, etc.), but I never really motivated myself enough to go back to the blog.
Until now, that is. Time has come to revive it! 
Motivation? The crisis, of course. The COVID-induced economic downturn. 
The "Don't Worry" blog started after the previous crisis. I was very invested in tracking the consequences of the 2008/09 financial crisis as well as the E…