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“The back story on front page economics.” These accessible essays cover the basics of economic topics, with a separate version for use in the classroom. Special “Focus on Finance” essays cover personal finance.

Posted 2012-11-01

The Output Gap: A “Potentially” Unreliable Measure of Economic Health?

by Elise A. Marifian

The output gap is one (of many) economic indicators used by economists to measure the strength of the economy. What exactly is the output gap, and how accurately does it predict the state of the economy? Read this month's Page One Economics Newsletter, "The Output Gap: A 'Potentially' Unreliable Measure of Economic Health," for an explanation of the output gap and answers to these questions.  
Posted 2012-10-01

The Great Inflation: A Historical Overview and Lessons Learned

by David A. Lopez

All inflation isn't bad—a moderate amount can signal a healthy economy. But high inflation, such as that during the Great Inflation, can lead to a viscious cycle where expectations of higher inflation lead to further increases in the price level. Read the October 2012 Page One Economics Newsletter to find out what caused the Great Inflation, how tough (and painful) policy brought it to an end, and two key lessons learned.

Posted 2012-09-01

Higher Gasoline Prices: Temporary or Time to Buy a Hybrid?

by Li Li

Drivers may wonder whether the most recent spike in gasoline prices is temporary or will be longer lasting. Will prices eventually decline—maybe even to below $3 per gallon? Or is it time for drivers to alter their driving habits, maybe by buying a hybrid car? Be sure to read the September 2012 issue of Page One Economics Newsletter —"Higher Gasoline Prices: Temporary or Time to Buy a Hybrid?"—for a discussion of factors that might influence that decision.
Posted 2012-08-01

The Legacy of the Olympics: Economic Burden or Boon?

by Lowell R. Ricketts

Competition, sportsmanship, and national pride are the foundations of the Olympics, but how much do the Olympics cost the host city and country? What are some of the economic benefits and costs? Is the investment in the Olympics worth it in the end? Read about previous host experiences with the economic side of the Olympics in this month's Page One Economics Newsletter "The Legacy of the Olympics: Economic Burden or Boon?" (see related graph: "Olympics-Related Temporary Increase in Employment"
Posted 2012-05-01

“Wait, Is Saving Good or Bad? The Paradox of Thrift”

by E. Katarina Vermann

The average saving rate for the typical American household before the recession started in 2007 was 2.9 percent; since then it has risen to 5 percent. Uncertainty about the future was the primary driver for the increase. More saving is a good thing, right? Well, some economists argue it might be detrimental to the overall economy. Given the benefits to individuals, how could this be? This month's Page One explores this "paradox of thrift."
Posted 2012-04-01

“Dewey Defeats Truman”: Be Aware of Data Revisions

by Mingyu Chen

The famous"Dewey Defeats Truman" headline illustrates the importance of timely and accurate data. Agencies that compute economic indicators for the $14 trillion U.S. economy face a tough challenge: providing up-to-the minute results and ensuring the reliability of the data. This month's Page One newsletter, "Dewey Defeats Truman": Be Aware of Data Revisions, explains why there is often a trade-off between these two factors and discusses the importance of data revision.
Posted 2012-03-01

Gini in a Bottle: Some Facts on Income Inequality

by David A. Lopez

Income inequality has been rising in the United States and other developed countries. The March 2012 Page One Economics Newsletter discusses income inequality, its causes, and some possible policy solutions.
Posted 2012-02-01

Traditional Versus Shadow Banking

by Bryan J. Noeth

Modern economies rely heavily on financial intermediaries to channel funds between borrowers and lenders. In the first edition of the Page One Economics Newsletter, the role of traditional banking is outlined and a parallel system—shadow banking—is explored.
Posted 2012-01-01

What Do Financial Market Indicators Tell Us?

by Linpeng Zheng

To those unfamiliar with financial and economic lingo, the terms bandied about in the news can sometimes make no sense. The January 2012 Liber8 Newsletter, "What Do Financial Market Indicators Tell Us?" offers some help with explanations of common terms. The essay is accompanied by a table of terms, definitions, and the significance of each to the broader economy.

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