I don’t quite remember what got me going on this, but I thought I’d start off the week with a quick look at how the economy has been doing over the past few years.
First, here are two measures of core inflation (i.e., excluding food and energy), the Fed’s favored instrument for gauging price movements. Inflation hasn’t reached the Fed’s goal of 2 percent the entire time, and shows no signs of acceleration:
Here’s labor force participation. Its long-term decline has stopped for both men and women and has been basically flat for the past four years:
And here are weekly wages for production and nonsupervisory workers, adjusted for inflation. There’s been slow but steady growth for four years:
So inflation is subdued and shows signs of staying subdued. Labor force participation is flat. And wages of ordinary workers have been growing at about 1 percent per year.
There’s nothing really new here: these charts just show that the economy is in good shape. Not great, not bad, but pretty decent. You can tell a lot of different stories with data like this, so be just as wary of folks peddling doomsday scenarios as you are of presidents pretending that the economy is booming.
