Manufacturing Coming to Africa

Water Affordability

The Politics of Mortgage Deductions

European Economics 101

Export Update

From Brookings:

"Our new analysis of goods and services exports for 381 metropolitan areas shows that, in 2016, exports did not drive significant economic growth in most parts of the country. The export slowdown was linked to declines in manufacturing exports, particularly in the industrial Midwest.

The recent decline marks a departure from the national post-recession trend. Between 2009 and 2014, exports accounted for 26 percent of the growth in U.S. gross domestic product (GDP). But U.S. exports declined in 2015 and again in 2016, hampered by a strong dollar and sagging global demand. Exports recovered slightly in the first quarter of 2017, but not enough to counteract losses in the previous two years."

Update on The Yield Curve

From the New York Times:

"That is probably not what most people want to hear — stock investors especially. In the first half of the year, after all, stocks have performed spectacularly. The Standard & Poor’s 500-stock index returned 9 percent through June, churning out gains so regularly that it may seem churlish to note that clouds are appearing on the horizon.

Yet like a long-range forecast about a possible storm, an old and trusted financial indicator is telling us that trouble may be looming.

Simply put, while the Federal Reserve has been raising short-term interest rates since December, the bond market hasn’t gotten the memo. The longer-term rates that are set through bond market trading have, for the most part, been declining, though there was a brief reversal in the last few days. But the disconnect over the last few months is a sign that bond investors believe economic growth and inflation are still weak and the Fed’s actions are premature."

A good primer on The Yield Curve - -

An Idea Worth Considering - Owning Your Social Media Data

Opinion | A Way to Own Your Social-Media Data https://t.co/1XBx7oqO2b

— Dr.Steven D.Sanders (@DocEngineering) July 2, 2017

Round One of the Driverless Revolution

From Medium - - might be where the initial wave of driverless investment is focused.

The iPhone Anniversary

Great stats from The One Device: The Secret History of the iPhone by Brian Merchant - -

Sales by brand in the best selling categories - - Toyota Corolla (43 million units), Sony PlayStation (382 million units), Harry Potter series (430 million books) - - and the iPhone with one billion units.

Graph of the Week

A Paragraph to Ponder

From TPM Cafe:

"Like most everything with Trump, I think there is a significant element of truth in the causes that he picks up. He is addressing some real grievances. But then the manner in which he addresses them is completely bonkers. So in the case of Germany, I do think Germany is the world’s greatest mercantilist power right now. It used to be China. China’s surplus has gone down in recent years, but Germany’s trade surplus is almost 9 percent of GDP. And they are essentially exporting deflation and unemployment to the rest of the world... it is not a trade problem. It is a macro-economic problem. The solution is to get German consumers to spend more and save less and the German state to spend more and to increase German wages. It is not the trade policies of the US or any other country that is going to be able to address this issue. It is similar to the way Trump has picked up grievances about how trade agreements have operated in the United States. These agreements have created loses, and grievances that have not been addressed, and I think there is a lot of truth to those kind of things, but I don’t think he has any realistic way of dealing with those things."

Graph of the Week

One Reason for Our Infrastructure Woes

From economist Matthew Kahn - - 

"Yes, NYC has an old subway system but that doesn't explain the interesting fact presented in the NY Times today that the C trains are over 53 years old.   Binding budget constraints provide the explanation for why this rich city (that relies on public transit) isn't investing in public capital.  As we document in this NBER Paper,  progressive big cities generously pay unionized public sector workers.   Due to the Buy America Mandate, such cities also pay more than the international price for pieces of capital (read our 2015 JUE paper).  The combination of paying public labor a very high salary and benefits plus high capital purchase costs means that there is little $ left for investing in capital replacement and upgrading.  #budget_contraints_matter"

Graph of the Week

The Economic Importance of the Engineer

Engineering Growth: Innovative Capacity and Development in the Americas. https://t.co/eRJNWSDOgy pic.twitter.com/GujliofkTQ

— Patrick Collison (@patrickc) May 29, 2017

The Impact of Declining Retail

From CityLab:

"Nationwide, sales taxes comprise nearly one-third of the taxes that state governments collect and about 12 percent of what local governments collect, according to Lucy Dadayan, a senior researcher at the Nelson A. Rockefeller Institute of Government, a New York-based research group. “The epic closures of the brick-and-mortar stores is troubling news for state and local government sales-tax collections,” she said. They’re already feeling the hit: States’ tax revenues grew just 1.9 percent between 2014 and 2015, after growing 5.8 percent in the previous four quarters, according to the Rockefeller Institute. Local-government sales-tax collections grew just 1.7 percent, after growing 7.5 percent in the previous four quarters. In Ohio, state tax revenues grew just 0.1 percent, when adjusted for inflation, between 2015 and 2016, according to Dadayan. When revenues don’t continue to grow, governments have to slow down spending and can’t readily invest in long-term projects."

Infrastructure Inc.

Trump's Transportation Budget: Hope You Like Private Toll Roads https://t.co/8lJI67oFs5

— Dr.Steven D.Sanders (@DocEngineering) May 24, 2017

A Paragraph to Ponder

From Tyler Cowen:

"What’s also striking is that, if the Trump budget can work at all, the spending cuts are probably not needed. It would suffice to cut taxes only, and allow the economy to grow out of an even-greater budget deficit. In this regard, the Trump budget reflects a deep incoherence, and it inconsistently mixes various optimistic and pessimistic scenarios. If the spending cuts are required for fiscal stability, then we probably shouldn’t be doing the tax cuts.

This framework allows us to pinpoint the huge and, I would say, excessively dangerous gamble in Trump’s budget. There is no guarantee that the growth rate of the economy remains higher than the government’s borrowing rate. It is common in American history that government borrowing rates run 5 percent or higher, and the aging of the American population, or perhaps an unexpected catastrophe, such as a war, could lower the growth rate. 1 And once a government becomes addicted to borrowing, it is hard to shake the habit, as subsequent tax increases damage economies."

Sand

From the New Yorker - The World is Running Out of Sand:

"Pascal Peduzzi, a Swiss scientist and the director of one of the U.N.’s environmental groups, told the BBC last May that China’s swift development had consumed more sand in the previous four years than the United States used in the past century. In India, commercially useful sand is now so scarce that markets for it are dominated by “sand mafias”—criminal enterprises that sell material taken illegally from rivers and other sources, sometimes killing to safeguard their deposits. In the United States, the fastest-growing uses include the fortification of shorelines eroded by rising sea levels and more and more powerful ocean storms—efforts that, like many attempts to address environmental challenges, create environmental challenges of their own."

This Cannot Be Healthy