Need more evidence that we’re all just a little bit poorer than we need to be? This week’s disappointing news on U.S. production of long-lasting capital goods was another reminder that trade wars and the resulting slower world economy are eating away at our prosperity.
Arnold Kling wisely warns against taking macroeconomic data too seriously. Here’s his conclusion:
Overall, I recommend being very wary of macroeconomic analysis that purports to give trends in productivity or to compare real income today with real income in past decades. The range of different answer that you can get using reasonable alternative methods for constructing the data far exceeds the variation in the phenomena that you are trying to assess.