Outlook

Reports

U.S. and global economic growth are slowing, trade tensions with China remain unresolved, and market volatility, which in a few short months erased gains for all of 2018.

Historically, the party in the White House almost always loses congressional seats in midterm elections, and the 2019 shift to Democratic control of the House of Representatives fits this trend. 

For much of the last decade, blockchain was known chiefly as a technology developed to support bitcoin, the world’s first all-digital currency. However, the technology supporting them has emerged as a way to potentially revolutionize how companies process transactions.

Unfinished Business

October 2018
In recent months, the United States has resolved a number of disputes with key trading partners, which has provided a more positive environment for agriculture and other export-dependent industries. 

The price of a barrel of oil has a profound impact on the global economy. When the price moves steadily higher as it has during the past year, with about a 60 percent rise since June 2017, nations, industries and individual consumers take notice. Read the July issue of Outlook for insights on what’s ahead from leading energy expert Rusty Braziel.

David R. Kotok, chief financial officer of Florida-based Cumberland Advisors who has seen just about every kind of economic and market condition since co-founding Cumberland in 1973, believes the Fed’s gradual approach to increasing rates will be enough to keep inflation moderate while allowing growth to continue.
To judge by the long history of this nation’s midterm elections, it would be a mistake to take any prediction as absolute truth, says Dr. Larry J. Sabato, the founder and director of the University of Virginia Center for Politics. Surprises are the rule, not the exception, Sabato says.
While Americans have disputed immigration policy since the founding of the country, passions tend to be highest during periods when the numbers rise, says Theresa Cardinal Brown, director of immigration and cross-border policy for the Bipartisan Policy Center in Washington.
Joshua P. Meltzer, senior fellow in the Global Economy and Development program at the Brookings Institution, argues that imposing trade restrictions won’t eliminate the trade deficit, which he says is driven by larger macroeconomic forces.
Charles F. (“Chuck”) Conner, president and chief executive officer of the Washington-based National Council of Farmer Cooperatives (NCFC), spoke with OUTLOOK about what cooperatives and farmers can expect from the new tax law, who is most likely to benefit, and what they can do to prepare.

The Next Fed Chair

December 2017
Robert Eisenbeis, Ph.D., vice chairman and chief monetary economist for the Florida-based investment advisory firm Cumberland Advisors, has held senior advisory positions at both the Federal Reserve Bank of Atlanta and the Federal Reserve Board. He spoke with Outlook about what we can expect from new Fed chair Jerome Powell and the Fed in the years to come.
Tax reform won’t happen easily, in part because the current system is so complicated, says John W. Diamond, the Edward A. and Hermena Hancock Kelly Fellow in Public Finance at Rice University’s Baker Institute and a longtime advocate of reforming the U.S. system.
Economist Josh Bivens, the director of research at the Economic Policy Institute, spoke with OUTLOOK about why the Fed has a target rate for inflation, the benefits of allowing inflation to rise even further, and why he disagrees with the Fed’s recent interest rate hikes.
Jared Bernstein, a senior fellow at the Center on Budget and Policy Priorities and former chief economist to Vice President Joe Biden, spoke with OUTLOOK about why the unemployment rate by itself can be deceptive, what’s going on with wages and inflation, and what signs will tell him the job market and economy have fully recovered.
Urike Malmendier, an economics professor at the University of California, Berkeley, and the winner of the Fischer Black Prize in finance, has performed landmark studies on how people’s biases, errors and non-rational behavior play out in the marketplace, as well as in the way they make personal decisions.

The Future of OPEC

April 2017
Though it still controls some 40 percent of global oil production and some 60 percent of the world’s exported oil, OPEC has lost much of its ability to impose prices, says Greg Priddy, director of global energy & natural resources for the global risk consulting firm the Eurasia Group.
How will rising rates affect the value of U.S. assets going forward? To answer that question, OUTLOOK turned to W. Michael Cox, founding director of the O’Neil Center for Global Markets and Freedom for the Cox School of Business at Southern Methodist University and a former chief economist with the Federal Reserve Bank of Dallas.
Mauro Guillén, Professor of International Management at the Wharton School of the University of Pennsylvania spoke with OUTLOOK about why the dollar is surging, what businesses are most likely to prosper or feel the pinch, and what’s ahead in the ever-shifting realm of global currency valuations.

The Robots Are Coming

January 2017
Martin Ford, a prominent futurist and bestselling author, spoke with OUTLOOK about the surprising array of professions that may be threatened by AI, and some controversial solutions to the disruption that robots may bring to American society.

With President-elect Trump now preparing to take office, along with a Republican majority in both houses of Congress, OUTLOOK turned to economist Kevin Hassett from the American Enterprise Institute for perspective on how the rural economy will fare in a Trump administration.
Sasha Riser-Kositsky, an Asia analyst for Eurasia Group, a leading consulting firm dedicated to global risk, spoke with OUTLOOK about Prime Minister Nerendra Modi’s ambitious plans to ramp up foreign investment, breathe life into India’s manufacturing base, and convince millions of traditional farmers to move from the fields to the factory floor.
Douglas Holtz-Eakin, former chief economist of the President’s Council of Economic Advisers during the administration of George W. Bush, believes that worker productivity means “everything” to GDP growth and that decreasing productivity will reduce our standard of living.
Wellesley College economist and former economist with both the Federal Reserve and the Treasury Department, Daniel Sichel spoke with OUTLOOK about the logic behind negative rates, why he believes they’re a remote (but not impossible) option for the United States, and how analysts will ultimately look back on this remarkable period in the history of monetary policy.
OUTLOOK recently spoke with Dan Glickman, U.S. secretary of agriculture from March 1995 until January 2001, to better understand Brexit’s potential fallout, especially on America’s food producers and exporters.
Jonathan Lieber, the U.S. director of the Eurasia Group, says the net benefits of free trade for the U.S. are enormous – and that the next president will do far more harm than good if he or she tries to roll back trade agreements that have lowered costs for consumers and cemented economic ties between America and countries around the world.
James D. Hamilton, a professor of economics at University of California San Diego, believes that the bad first quarter number isn’t a harbinger of a bad growth year ahead. He believes the economy will continue to chug along consistent with the 2 to 2.5 percent growth rate of the past several years. And he professes not to be worried about a recession in the near term.
Stuart Anderson, the executive director of the National Foundation for American Policy spoke with OUTLOOK about the history of immigration in the United States, including some past programs and initiatives that could hold answers for the future, and their overall impact on the U.S. economy.
OUTLOOK talked with author Dr. Robert Gordon from his office at Northwestern University about how America changed in the century from 1870-1970, why the Internet hasn’t caused the same type of transformation, and what we can do now to enhance our productivity in the future.
According to Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor, one reason for stagnant wage growth is that a greater number of lower-skilled jobs are being created, holding the average wage down. Worker productivity is down, too, which also tends to inhibit wage increases.
Donald Luskin, founder and chief investment officer of Trend Macrolytics LLC, a research firm and strategic consultancy to major financial companies, spoke with OUTLOOK about technology behind the world’s newfound abundance of oil, the temporary pains it’s causing at home and abroad, and why he believes that, once the recession ends, cheap oil will usher in a new era of prosperity.

The Fed's Path Forward

November 2015
On Wednesday, December 16, at the Federal Open Market Committee’s final meeting of the year, the Fed increased short-term interest rates by one-quarter of one percentage point. For perspective on the decision, OUTLOOK turned to noted economist Randall S. Kroszner, who served as a Governor of the Federal Reserve System between 2006 and 2009.
avid Dollar, senior fellow in Foreign Policy and Global Economy and Development for the Brookings Institution spoke with OUTLOOK about steps China must take to avoid a worst-case scenario, why he believes China’s middle class will keep growing, and what U.S. agriculture and other industries that do business with China can expect in the months ahead.
OUTLOOK recently spoke with former U.S. senator Christopher Dodd about the legacy of his namesake law. Dodd remains a passionate supporter of the legislation, but also acknowledged the critical need for global harmonization of financial services regulation and the political realities that affect the financial landscape to this day.
Menzie Chinn, Professor of Public Affairs and Economics at the University of Wisconsin’s Robert M. La Follette School of Public Affairs and the co-editor of the Journal of International Money and Finance, talked to OUTLOOK about what the euro can and can’t do for the nations of Europe, and what it might do to our economy here at home.
For perspective on the economy’s performance and what it means for rural America, OUTLOOK turned to Joseph Glauber, Senior Research Fellow at the International Food Policy Research Institute in Washington, D.C.
To help us understand the current housing market and the lingering effects of the subprime catastrophe in 2005-07, OUTLOOK recently sat down with Michael Fratantoni, chief economist with the Mortgage Bankers Association, which represents the real estate finance industry in the U.S.
Alex Pollock, resident fellow at the American Enterprise Institute and the former head of the Federal Home Loan Bank of Chicago, discusses the Fed’s thinking, his views on interest rate manipulation, and the strange science of trying to predict the Fed’s actions.
An outspoken critic of the health care law, and of the various conservative counterproposals, health care policy expert Robert Graboyes, a scholar at the Mercatus Center at George Mason University, says a ruling by the Court against Obamacare will likely cripple the law and cause significant turmoil for the government, businesses and citizens alike.
OUTLOOK recently interviewed Eswar Prasad, Tolani Senior Professor of Trade Policy at Cornell University and author of “The Dollar Trap: How the U.S. Dollar Tightened Its Grip on Global Finance” to get a complete picture of the impact of a strong U.S. dollar.
Emphasizing that he has “no idea” how equity markets will perform in the short run, Burton Malkiel, emeritus professor at Princeton University and author of A Random Walk Down Wall Street:The Time-Tested Strategy for Successful Investing believes long-term rates of return going forward are apt to be relatively low due to a variety of factors.
To explain why oil and gasoline prices have decreased so rapidly and what we might expect to happen in the coming months and years, OUTLOOK recently sat down with Greg Priddy of the Eurasia Group, a global political research and consulting firm.
OUTLOOK recently spoke with Andrew Biggs, resident scholar at the American Enterprise Institute and former principal deputy commissioner at the Social Security Administration. to understand his views on the condition of the Social Security system and how it should be fixed.

Knowledge Exchange Item

September 2014
For perspective on the elections, OUTLOOK turned to Dr. Larry Sabato, founder and director of the University of Virginia Center for Politics. Sabato is widely quoted in the media as an expert on politics, and also directs the Center for Politics’ Crystal Ball website, a leader in accurately predicting elections since its inception.
Economist Peter Morici believes the danger of inflation in the U.S. remains very real – and is growing. He argues the Fed needs to take steps soon to make sure inflation doesn’t gain a foothold in the economy.
Political scientist William Galston, a fellow at the left-leaning Brookings Institution who also writes regularly for The Wall Street Journal,  recently spoke with OUTLOOK about underemployment and what it portends for the nation’s economic and social fabric.
OUTLOOK recently asked Donald Boudreaux, professor of economics at George Mason University, about the so-called “decoupling” of wages and productivity, and what it might mean to the economy, and whether the middle class is, in fact, disappearing because of it.
OUTLOOK recently sat down with Dr. Barry Eichengreen, author and Professor of Economics and Professor of Political Science at the University of California, Berkeley, to understand how the U.S. dollar is currently faring in the global economy and what we might expect to see in the future.
Best-selling business author Larry Downes spoke with OUTLOOK about his recent book “Big Bank Disruption: Strategy In The Age of Devastating Innovation,” and the lessons it holds for corporate leaders.
Economist Lee Ohanian, a professor of economics at UCLA and a senior fellow of the Hoover Institution at Stanford University, says it’s imperative that we find a way to restore productivity growth in the U.S. or there will be significant negative consequences for the economy and standards of living over the long term.
In order to better understand the Fed’s challenges and how Yellen is likely to address them, OUTLOOK recently spoke with Darrell Duffie, Dean Witter Distinguished Professor of Finance at the Graduate School of Business at Stanford University.
As 2013 draws to a close, the U.S. economy is exhibiting signs of marked improvement when it comes to jobs. For an update on the overall situation in the United States, OUTLOOK turned to economist David Hale, who is the founding chairman of David Hale Global Economics and previously worked as chief economist for Kemper Financial Services and Zurich Financial Services.

According to economist Douglas Holtz-Eakin, we’re on an unsustainable trajectory. Holtz-Eakin, who served as the director of the Congressional Budget Office from 2003 until 2005, is the founder and president of the American Action Forum, a nonprofit Washington think tank.
For an update on America’s infrastructure, OUTLOOK turned to Andy Herrmann, 2012 president of ASCE, which produces the thorough analysis of the nation’s infrastructure every four years.
To understand what is happening in the U.S. housing market, OUTLOOK recently spoke with David Blitzer, managing director and chairman of the Index Committee of the S&P Dow Jones Indices, which issues the S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices.
For a current look at the global oil market and its impacts on the broader economy, OUTLOOK talked to Jim Ritterbusch, president of Ritterbusch and Associates, an independent consulting firm that provides research to the oil and financial industries.
For an update on Mexico, OUTLOOK turned to Alberto Diaz-Cayeros, director of the Center for U.S.-Mexican Studies at the University of California, San Diego.
OUTLOOK turned to author and health-care expert Ian Morrison, a founding partner in Strategic Health Perspectives, for his take on the nation’s overall state of readiness for “Obamacare” and how the law is being implemented.
Economist Donald Marron, who served on the President’s Council of Economic Advisers under George W. Bush, believes it will be difficult for the U.S. to sustain GDP growth of more than about 2.5 percent going forward, given an aging population and slow growth in the labor force.

China in Transition

March 2013
Expectations are high that Xi and his allies will begin to mend social welfare programs and institute other government and economic reform policies. But reform won’t be quick, nor will it come easy, according to Ian Bremmer and Nicholas Consonery with Eurasia Group.
Harvard University professor Mihir Desai argues that reforming the corporate tax system is “perhaps the most obvious and least painful” way to restore America’s competitive position and improve the living standards of ordinary people.
OUTLOOK recently interviewed author Vivek Wadhwa about immigrant entrepreneurs and how their flight is impacting the economy.

The Revenge of Geography

December 2012
As world affairs expert robert Kaplan notes in a new book, geographic factors exert a profound but increasingly overlooked influence on states and how they cooperate and conflict with one another. Kaplan is a longtime foreign correspondent who is also chief geopolitical strategist for Stratfor, the well-known and highly regarded private intelligence firm.
When it comes to economic policy, the divide is particularly deep. For evidence, look no further than OUTLOOK’s interview below with two highly respected economists from either side of the ideological spectrum.

Given the Fed’s continued easy money posture, OUTLOOK turned to Harvard economist Jeff Frankel for a primer on the connection between rates and commodity price levels.
Harvard Business School professors Gary Pisano and Willy Shih say many business leaders are approaching the manufacturing problem from the wrong angle. They explain how, in many industries, innovation is intricately linked to manufacturing and how our nation’s competitiveness relies on industry rethinking the relationship between their design and production functions.
For an update on India and where it’s headed, OUTLOOK turned to Devesh Kapur, director of the Center for the Advanced Study of India at the University of Pennsylvania, and Nicholas Burns, Harvard University international politics professor and former U.S. undersecretary of state for political affairs.
OUTLOOK talked recently with Kevin A. Hassett, an economist with the American Enterprise Institute, a columnist for the National Review and an advisor to Republican presidential candidate Mitt Romney, who believes the nation could be in for a rough ride if the fiscal cliff isn’t averted.
For an update on China and Japan, OUTLOOK turned to two experts on Asia for their perspective. Jeffrey Shafer is former vice chairman of global banking at Citigroup and a leading authority on China. William Tsutsui is dean of the Dedman College of Humanities and Sciences at Southern Methodist University.
With the price of crude oil hovering around $100 per barrel and a gallon of gasoline peaking at more than $4 per gallon in some areas in April, OUTLOOK asked Jerry Taylor, a senior fellow and economist at the Washington-based Cato Institute who has written extensively on a wide variety of energy and environmental issues, to weigh in on the outlook for energy costs.
By most key measures, the U.S. economy is still struggling: GDP growth is lethargic, the housing market remains weak and unemployment rates are uncomfortably high. But physicist-turned-technology consultant Mark Mills argues there is reason for optimism.
OUTLOOK asked finance expert Alex Pollock for his perspective on the current sovereign debt crisis – and the lessons history offers about what’s happening in Europe today.
OUTLOOK interviewed economist Robert Graboyes, a senior fellow for health and economics at the NFIB Research Foundation. A fierce critic of the Affordable Care Act, he says Americans are only beginning to understand the profound impacts it will have on business and the health care delivery system in this country.
For Robert Guest, business editor of The Economist, the most important aspect of globalization is the movement of people. Guest argues that the free flow of people and ideas is, on balance, highly beneficial. Migration and more open borders, he says, fuel the exchange of ideas and make nations smarter, more innovative and competitive.

The Eurozone Crisis

December 2011
Economist Judy Shelton, co-director of the Sound Money Project at the atlas economic research Foundation in Washington, believes, like many observers, that 2012 likely will be a make or break year for the euro.
According to energy analyst Robert Bryce, it’s hard to overstate the economic impact of this so-called “shale revolution.” Bryce contends that increased energy production from shale will not only play an important role in the nation’s overall energy portfolio, it will also unleash an industrial renaissance in this country.
Economic and agricultural historian Peter A. Coclanis, Albert Ray Newsome Distinguished Professor at the University of North Carolina, argues that food poisoning in the United States today is actually at an all-time low, both by historical standards and in relation to the rest of the world.
What is the future of nuclear power here in the United States? To answer that question, OUTLOOK turned to expert William Tucker, who has written about nuclear technology for the New York Times, the Wall Street Journal and other leading publications.
The debt ceiling fracas, along with Standard & Poor’s downgrade of U.S. debt from triple-A to double A-plus just days later, accomplished something quite important, says distinguished economist Douglas Holtz-Eakin: they got the whole country talking about the looming national debt.
With overall economic growth averaging just 2.3 percent over the last four quarters, the high unemployment rate has many Americans wondering why this recovery is so different from previous economic upturns. To find out, OUTLOOK turned to economist Robert E. Hall, a professor at Stanford University and chairman of the National Bureau of Economic Research’s Committee on Business Cycle Dating, the group that officially dates the beginnings and ends of U.S. recessions.
OUTLOOK recently asked two experts for their perspective on the state government budget crisis and its impact on the broader economy. Arturo Pérez is director of the Fiscal Affairs Program at the National Conference of State Legislatures and specializes in state tax and expenditure policy. Tucker Hart Adams is a senior partner with Summit Economics and has more than 30 years of experience in economic research, analysis and forecasting.
To get some perspective on the graying of the American workforce and its potential impact on the nation’s economy, OUTLOOK spoke with Ronald Lee, professor of economics and director of the University of California - Berkeley’s Center for the Demography and Economics of Aging, and Dallas Salisbury, president and CEO of the Employee Benefit Research Institute, an independent, nonprofit organization that conducts employee benefits research.

The Future of Water

April 2011
In his new book, The Big Thirst, Journalist Charles Fishman explores our relationship with water, how it has changed over time and how it is likely to evolve in the future.
For insight into the oil market and its future, OUTLOOK turned to Jim Ritterbusch, president of Ritterbusch and Associates, an independent consulting firm that provides research to the oil and financial industries.
To get a sense of both the risks and the opportunities in the Middle East, OUTLOOK spoke with Isobel Coleman, a senior fellow at the Council on Foreign Relations in New York City. She is director of the Council’s Civil Society, Markets and Democracy Initiative, and the author and co-author of numerous publications.

The U.S. in 2050

January 2011

Economist Joel Kotkin predicts the U.S. population will climb from about 300 million people today to 400 million by mid-century. In his latest book, he argues that the United States’ greatest priority will be to create opportunities for this huge number of new people. OUTLOOK recently spoke with Kotkin about what could go right, and wrong, over the next 40 years.

 

OUTLOOK turned to Carnegie Mellon economist Allan H. Meltzer to put quantitative easing into long-term context. An unabashed critic of quantitative easing, Meltzer is also the author of a two-volume history of the Fed, covering the years 1913 to 1986.
According to Ross C. DeVol, executive director of economic research at the Milken Institute in Santa Monica, California, real GDP for the United States is on track to grow by 3.7 percent in 2011 and 3.8 percent in 2012. Private sector employment, meanwhile, will grow by 3.1 million jobs next year.
Vernon Smith, a Nobel Prize-winning economist from Chapman University, and Steven Gjerstad, a Presidential Fellow at Chapman, recently delved into economic data going back to the Great Depression. They discovered that, with very few exceptions, a falloff in the housing market preceded recessions and had a much greater impact than other economic forces, such as business investment.
According to Russia expert Bruce Parrott, not even the Russians are sure just what they want to be going forward. Parrott, a professor at Johns Hopkins University who has served as a consultant to both the U.S. State Department and Department of Defense, recently talked with OUTLOOK about a nation deeply ambivalent about its future and jealous of its superpower past.
OUTLOOK recently spoke with Russ Roberts, an economics professor at George Mason University and research fellow at Stanford University’s Hoover Institution about Hayek’s theories and their implications for public policy in the current political and economic environment.
OUTLOOK recently spoke with Douglas A. Irwin, professor of economics at Dartmouth College, about the history of protectionism and the outlook for global free trade as the economy climbs out of recession.
To gain some perspective on the future of federal tax policy, OUTLOOK spoke with Leonard E. Burman, Daniel Patrick Moynihan Professor of Public Affairs at Syracuse University. He is former director of the Tax Policy Center, a think tank that aims to provide independent analysis of current and longer-term tax issues.
OUTLOOK recently spoke with economist Judy Shelton, a frequent contributor to the Wall Street Journal, about the situation in Greece and its potential impacts on global economics. Shelton, a senior fellow at the Atlas Economic Research Foundation, specializes in international monetary and finance issues.
Demographer Robert W. Fogel does not believe a “population bomb” threatens the long-term well being of the planet. Fogel, who won the Nobel Prize for Economics in 1993, contends that population growth will not constrain the world’s ability to feed everyone and, in fact, argues that the quality of life for people worldwide will continue to improve over time.
Business strategy consultant and entrepreneur Michael Treacy contends that the conventional wisdom is wrong. Treacy, a former MIT business professor and successful entrepreneur, argues that any company should be able to achieve double-digit growth in any industry segment – regardless of market conditions at any given time.

George Melloan, who retired from The Wall Street Journal in 2006 after spending more than 33 years as a deputy editorial page editor, is one of the leading voices for those who believe that government is interfering too much. He recently talked with OUTLOOK about his take on the causes of the recession, how government has responded and what needs to happen next.

 

Todd Buchholz, an economist, a former White House Director of Economic Policy, a managing director of the $15 billion Tiger hedge fund, and a professor of economics at Harvard University talked with OUTLOOK recently about the economic recovery and his thoughts on inflation risk.