FEDS Notes
FEDS Notes are articles in which Board staff offer their own views and present analysis on a range of topics in economics and finance. These articles are shorter and less technically oriented than FEDS Working Papers and IFDP papers.
Real GDP and Productivity Measurement: What Do Macro Data Capture?
Since the publication of their 2021 "Blue Book", the UK's Office for National Statistics started to measure real GDP in the national accounts using double deflation. This methodological update follows the premise that "double deflation is internationally accepted as the best approach to producing volume estimates of industry Gross Value Added".
DOI: https://doi.org/10.17016/2380-7172.3317
Private Firm Repayment Vulnerabilities and Adverse Economic Conditions
This note extends to private firms an analysis of the impact of macroeconomic conditions on corporate interest coverage ratios (ICRs), a measure of repayment risk developed by McCoy et al. (2020). Our analysis is complimentary. We utilize unique data on private-firm balance sheets obtained through the Federal Reserve's Comprehensive Capital Analysis and Review (CCAR) process and evaluate the impact of updated and new macroeconomic projections on the distribution and path of corporate interest coverage ratios.
DOI: https://doi.org/10.17016/2380-7172.3254
Winners and losers from recent asset price changes
Asset prices and interest rates have changed dramatically and unexpectedly over the last two years as the Federal Reserve has raised its policy rate to combat higher inflation. In this note, we clarify the redistributive effects of these asset price changes in terms of welfare, which contrast sharply with those of wealth. Figure 1 depicts changes in the paths of six macroeconomic aggregates in the February 2023 CBO projection relative to their paths in the July 2021 projection.
DOI: https://doi.org/10.17016/2380-7172.3287
Did the Pandemic Change Who Became Behind on Rent? Characteristics of Renters Behind on Rent Before and After the Pandemic Onset
As millions lost their jobs at the start of the COVID pandemic, many Americans risked missing their rent payments. Policymakers responded to the pandemic with hundreds of billions of dollars in government assistance and restrictions on evictions.
DOI: https://doi.org/10.17016/2380-7172.3292
From-Whom-to-Whom Relationships in the Financial Accounts of the United States: A New Methodology and Some Early Results
The Financial Accounts of the United States (the Accounts or FAUS) provide data on the financial assets and liabilities of major sectors of the United States economy, disaggregated by financial instrument. The Accounts can thus serve many purposes, such as sizing sectors and instruments, analyzing changes in credit flows, and assessing the net worth of households.
DOI: https://doi.org/10.17016/2380-7172.3273
Gender Gaps in the Labor Market Widen Every Summer
Gender gaps in labor market activity are pervasive, longstanding, and a regular subject of policy debates. Relative to men, women tend to work fewer hours per week, more conventional hours, and fewer years over the course of their lives.
DOI: https://doi.org/10.17016/2380-7172.3274
Nonresidential construction spending is likely not as weak as it seems
Unlike any other major component of GDP, private investment in nonresidential structures excluding drilling and mining (henceforth "NRS") has steadily declined since the start of 2020. Figure 1 shows the evolution of GDP as well as the main components of private domestic final demand since 2019.
DOI: https://doi.org/10.17016/2380-7172.3283
Measurement and Effects of Supply Chain Bottlenecks Using Natural Language Processing
Supply chain bottlenecks can have significant impacts on the real economy. When firms experience shortages, shipping delays, or shutdowns, as occurred during the COVID-19 pandemic, they may be unable to produce, transport, and sell their products.
DOI: https://doi.org/10.17016/2380-7172.3257
A note on industry concentration measurement
Industry concentration—the share of sales or output accounted for by the largest firms within an industry—has received widespread attention recently, in part because concentration has generally risen in recent decades (figure 1). Measurement challenges are at the core of concentration-based inquiry: industry sales concentration is one of the lowest-frequency business statistics produced by the U.S. statistical agencies, with concentration data being released only twice per decade as part of the Economic Censuses.
DOI: https://doi.org/10.17016/2380-7172.3256
Balance Sheet Policies in an Evolving Economy: Some Modelling Advances and Illustrative Simulations
Once considered "unconventional," balance sheet policies have become an integral part of the toolkit of many central banks. Increased reliance on balance sheet policies reflects in part a decline in the neutral level of interest rates, which limits central banks' ability to cut their policy rates to support the economy during downturns, and many observers expect that neutral level to remain low relative to its historical average in the coming decades.
DOI: https://doi.org/10.17016/2380-7172.3246
New Insights from N-CEN: Liquidity Management at Open-End Funds and Primary Market Concentration of ETFs
Structural vulnerabilities associated with open-end funds have received increasing attention among academics and regulators over the past few years. Despite the effort by policymakers to enhance the liquidity risk management practices at these funds, evaluating the availability, use and effectiveness of liquidity management tools continues to be a challenging task in assessing vulnerabilities in open-end funds, largely because comprehensive data on open-end funds' access to liquidity management tools remain scarce.
DOI: https://doi.org/10.17016/2380-7172.3226
Drivers of Post-pandemic Inflation in Selected Advanced Economies and Implications for the Outlook
With the reopening of economies from strict COVID-19 lockdowns and the war-induced sharp increases in food, energy, and other commodity prices, headline inflation has surged globally, as shown for a few selected advanced economies by the black line in the left panel of figure 1. Core inflation (the dashed red line) has also risen sharply and has become increasingly persistent across these economies.
DOI: https://doi.org/10.17016/2380-7172.3232
The SNB-FRB-BIS High-Level Conference on Inflation Risk and Uncertainty
Uncertainty about inflation has risen considerably across the globe since the start of the COVID-19 pandemic. Lack of clarity about how far inflation might fall during the depths of the pandemic gave way to concerns about inflationary pressures as demand surged and supply was constrained throughout 2021.
DOI: https://doi.org/10.17016/2380-7172.3242
Disclaimer: FEDS Notes are articles in which Board staff offer their own views and present analysis on a range of topics in economics and finance. These articles are shorter and less technically oriented than FEDS Working Papers and IFDP papers.