What we’re reading (2/20)
“Midwest Labor Markets Shake Off Covid-19 Downturn” (Wall Street Journal). “Indianapolis, Minneapolis and Cincinnati joined Columbus as having among the lowest unemployment rates of 51 major metro areas at the end of last year, on the unadjusted basis the Labor Department uses to rank cities. That placed the heartland cities well ahead of tech and financial powerhouses such as San Francisco and Boston.”
“The SPAC Bubble Is About To Burst” (Harvard Business Review). “It seems almost everyone who is anyone is ‘sponsoring’ or setting up a SPAC, from ex-Trump adviser Gary Cohn to basketball star Shaquille O’Neal to Hong Kong tycoon Richard Li. But, as my recent paper shows, signs beyond the headline figures suggest that SPACs are a bubble about to burst.”
“What Unchecked Short-Selling Means For The Stock Market” (Morningstar). “Short squeezes like what we saw this year with GameStop aren't new. But the evolution of the communication between investors and the trading platforms used to mobilize around the stock are--at least to the investing world.”
“Ark Invest’s Cathie Wood On Bitcoin ETF Prospects And Tesla’s Billion-Dollar Investment” (CNBC). “Bitcoin’s long-term outlook is brightening, according to Ark Invest’s Cathie Wood. The CEO and chief investment officer of the explosively popular active management firm told CNBC this week that the cryptocurrency’s catalysts are adding up as it soars to unprecedented new highs.”
“In Defense of Concerns Over The $1.9 Trillion Relief Plan” (Petersen Institute). From former-IMF chief economist Olivier Blanchard: “Those economists (like myself) who agree with Treasury Secretary Janet Yellen about the need to ‘go big’ on a protection and stimulus package, but who have misgivings about the size of the Biden administration’s $1.9 trillion coronavirus relief plan, are getting criticized as overly concerned about overheating and inflation. A healthy debate has erupted. This blog post addresses three main issues in that debate and explains why I am concerned: first, the size of the output gap—i.e., the gap between actual and potential output in the economy; second, the size of the multipliers—i.e., the likely effects from the stimulus; and third, how much inflation an overheating economy may generate.”
