The first article previews a central point from one of the presentations at FHN Financial’s September Seminar (Sept 22) – the importance of credit quality past the initial liquidity support provided by the Fed in the second quarter. In previous recessions, losses eventually surpassed original expectations and loss reserves. It’s not clear if this recession will follow suit, but this fall’s economic/pandemic transition will provide important data that can set the course for interest rates in 2021.
Inflation Lab takes a close look at August CPI and another upside surprise from transportation costs – this time due to higher prices for used cars and trucks. Slower housing inflation offset some of that increase in monthly core inflation. Service inflation remains tame.
This week’s Covid-19 update looks at the relationship between the stringency of state restrictions and cases/million. Hint: There isn’t a reliable relationship at all. The analysis includes details from Florida and Texas by major metro areas. At the national level, numbers are improving but not quickly enough.