Welcome to Bespoke Brunch Reads — a linkfest of the favorite things we read over the past week. The links are mostly market related, but there are some other interesting subjects covered as well. We hope you enjoy the food for thought as a supplement to the research we provide you during the week.

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Meet Wall Street’s New King Makers: the ETF Strategists by Asjylyn Loder (WSJ)

With centrally managed portfolios of ETFs becoming more common, cross-market impacts can often be tied back to single decisions makers allocating huge volumes of cash. [Link; paywall]

Clean Energy

London summit 2017: Breaking Clean by Michael Liebreich (Bloomberg New Energy Finance)

Don’t be scared off by the daunting page count – many of these slides have only a few words and it’s a much quick read than you might expect at 170+ pages. Liebreich gives an excellent recap of where non-carbon energy has come from, and where it’s going, including some downright hilarious pessimism about the growth of installed capacity from forecasters. [Link; 171 page PDF]

What’s Old Is New Again

The History of Sears Predicts Nearly Everything Amazon Is Doing by Derek Thompson (The Atlantic)

While Amazon’s ethos seethes disruption and innovation, it’s taking a truly remarkable number of pages from the playbook of Sears, the first American company to offer ubiquitous home delivery. [Link]

The Oil Ghost Towns of Texas by Dan Murtaugh (Bloomberg)

West Texas has been home to booms and busts in the oil industry since oil was first discovered in the region and the current crop of busts is part of that long heritage. [Link]


Labor Market Outcomes in Metropolitan and Non-Metropolitan Areas: Signs of Growing Disparities by Alison Weingarden (FEDS Notes)

Part of a growing focus on distributional growth analysis, this paper does an excellent job analyzing the disparities between large metros and rural metros in terms of employment and wages. [Link]

Demographic Transition and Low U.S. Interest Rates by Carlos Carvalho, Andrea Ferrero, and Fernanda Nechio (FRBSF Economic Letter)

An econometric analysis of the impact of low population rates and an aging population on the real neutral rate of interest. [Link]

An Inflation Expectations Experiment by Carola Binder (Quantitative Ease)

Do consumers’ unrealistically high inflation expectations respond to priming by seeing charts of actual inflation rates or learning about the Fed’s 2% target? Indisputably, yes. [Link]


The IMF’s China Problem by Brad W. Setser (Council On Foreign Relations)

The macro imbalances of China (excessive credit growth, a huge fiscal deficit) should result in a very high current account deficit, but the absurd savings rate in China (~46% of GDP) means that the 1% current account surplus would be roughly 4-5x as high without imprudent domestic policies. The real problem is not China’s current account surplus: it’s the savings rate. [Link]

The Lamps are Going Out in Asia by Joseph Dethomas (38 North)

We acknowledge this column is somewhat alarmist, but still think the logic it uses is worth considering and should be read: the current North Korean situation really does look like the summer of 1914 in Europe in many ways. [Link]


Study: Women with more children are more productive at work by Ylan Q. Mui (WaPo)

St. Louis Fed researchers show in a recent paper that working economists with children are much more productive than their peers (as measured by output of papers). [Link; soft paywall]


Trump’s State-Tax Plan Could Cause Headaches for 52 Republican Lawmakers by Sahil Kapur (Bloomberg)

With Senate rules limiting the scale of budget impact for tax cuts wanted by GOP lawmakers, they’re forced to find pay-fors and have targeted the state and local tax deduction. Only problem? That deduction splits the Republican caucus badly in the House, where a unified front is needed to pass the package without Democrats. [Link]

Have a great Sunday!

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