Tag Archive for Grossman

Grossman Co-Authors Article on British Stock Market

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Grossman

Richard Grossman

Richard Grossman, professor of economics, recently co-authored an article titled “Before the Cult of Equity: the British Stock Market, 1829-1929” in European Review of Economic History, published on March 24, 2021.

According to the paper’s abstract, the co-authors “analyze the development and performance of the British equity market during the era when it reigned supreme as the largest in the world. By using an extensive monthly dataset of thousands of companies, we identify the major peaks and troughs in the market and find a relationship with the timing of economic cycles. We also show that the equity risk premium was modest and, contrary to previous research, domestic and foreign stocks earned similar returns for much of the period. We also document the early dominance of the transport and finance sectors and the subsequent emergence of many new industries.”

Wesleyan in the News

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NewsWesleyan in the News

1. Washington Post: “Biden Makes End Run Around Trump as the President Dominates the National Stage”

Erika Franklin Fowler, associate professor of government and co-director of the Wesleyan Media Project, comments on Biden’s unusual strategy during an unprecedented time for the 2020 presidential campaign. “There is not a ready off-the-shelf playbook for how you campaign in this environment if you are a nonincumbent, so that’s part of what you’re seeing,” she said. “We’re all being thrown into this new environment, where campaigns are going to need to reinvent, to some extent, how they go about things, how they going to go about reaching citizens.” Fowler added, “I think we’re at a stage of this event where people are starting to feel coronavirus fatigue. So it seems like to me that the local television news strategy and reaching around is probably a good one at this point.”

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Grossman on Mitigating the Economic Fallout from the Coronavirus

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Grossman

Richard Grossman

Richard Grossman, professor and chair of economics, is an expert in economic history as well as current policy issues in macroeconomics, banking, and finance. In this Q&A, we asked him about the economic fallout from the coronavirus pandemic, and how the government is responding in efforts to mitigate the damage.

Q: We’ve all seen the headlines about a coronavirus-induced recession. What is the current state of the economy, and what do you predict we’ll see over the coming months?

A: Prior to the virus outbreak, the American economy was doing well by conventional standards. The unemployment rate was 3.5% in March, down from a peak of 10% around a decade ago. According to the government’s most recent estimate (released on Feb. 27), real gross domestic product grew by 2.3% in 2019. Not stellar, but high relative to other developed economies. It is going to get substantially worse quite soon.

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Wesleyan in the News

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NewsIn this recurring feature in The Wesleyan Connection, we highlight some of the latest news stories about Wesleyan and our alumni.

Wesleyan in the News

1. CT Post: “Former Wesleyan Provost is First Woman President at Hobart and William Smith Colleges”

Joyce Jacobsen, formerly Wesleyan’s provost and senior vice president for academic affairs and the Andrews Professor of Economics, was inaugurated Oct. 18 as the first woman president of Hobart and William Smith Colleges. At the ceremony, the chairman of the HWS Board of Trustees said: “Dr. Jacobsen enters the presidency of Hobart and William Smith at a time of increasing complexity in higher education both here on campus and nationally. It is my belief, and the unanimous belief of the Board of Trustees, that there is no one better to help us navigate this future than Dr. Joyce Jacobsen.” Read more coverage of the inauguration in Finger Lake Times.

2. Wilson Center Blog: “Victoria Smolkin: A History of Soviet Atheism”

In this Q&A, Associate Professor of History Victoria Smolkin discusses her book, A Sacred Space is Never Empty: A History of Soviet Atheism. She explains how religion in the former Soviet states has changed since the fall of the Soviet Union, and offers a preview of her second book project. Smolkin was a Title VIII Research Fellow at the Wilson Center’s Kennan Institute in 2014–15.

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Grossman Discusses Latest Unemployment Trends on WTIC Radio

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Grossman

Richard Grossman

On Oct. 16, Richard Grossman, chair and professor of economics, discussed the latest unemployment numbers and current state of the economy with Todd Feinburg at WTIC in Hartford. This month, the national unemployment rate has fallen to a new low—3.5%.

“Historically, and certainly for the last 10 years, the number peaked at 10% after the financial crisis, and it’s been working its way down ever since,” Grossman said. “That doesn’t mean all is wonderful if you’re in the labor force. There’s a lot of other things going on … people working part-time who would like to be working full-time … people who are doing contract work that would like to be having full-time jobs with benefits.”

Economists generally see an uptick in wages when unemployment goes down.

“Last month, the wage rate went up, but it went up by less than it had gone up in the previous month, so it suggests that even though the employment rate is low, that still hasn’t had an effect on wage. Normally we’d expect a really strong labor market to have some positive impact on wages.”

Grossman is an expert on economic history and current policy issues in macroeconomics, banking, and finance.

Wesleyan in the News

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NewsIn this recurring feature in The Wesleyan Connection, we highlight some of the latest news stories about Wesleyan and our alumni.

Wesleyan in the News

  1. The Hill: “Analysis: 2020 Digital Spending Vastly Outpaces TV Ads”

The Hill reports on a new analysis by the Wesleyan Media Project, which finds that 2020 presidential hopefuls have spent nearly six times more money on Facebook and Google advertising than on TV ads. President Donald Trump and the Republican National Committee lead the way in digital advertising, having spent nearly $16 million so far. All told, Facebook and Google have raked in over $60 million on online ads this cycle to date. “At this stage in the campaign, candidate spending is driven by supporter list-building and investing heavily to secure enough donors to qualify for the Democratic debates,” explained Associate Professor of Government Erika Franklin Fowler, co-director of the Wesleyan Media Project.

2. Religion News Service: “Sixty Years Later, Only Frank Lloyd Wright Synagogue Continues as ‘Work of Art'”

Joe Siry, Kenan Professor of the Humanities and professor of art history, speaks about Beth Sholom Synagogue, the only synagogue designed by the distinguished architect Frank Lloyd Wright, on the 60th anniversary of its opening. Siry is an expert on Wright’s work, and the author of Beth Sholom Synagogue: Frank Lloyd Wright and Modern Religious Architecture (The University of Chicago Press, 2011). Read an interview with Siry about the book.

3. KERA “Think”: “Do Colleges Really Need Safe Spaces?”

President Michael Roth joins host Kris Boyd for a wide-ranging conversation in connection with his book Safe Enough Spaces: A Pragmatist’s Approach to Inclusion, Free Speech, and Political Correctness on College Campuses. They discuss Roth’s ideas of how to balance students’ needs to feel safe and included on college campuses while keeping them open to exploring new ideas, as well as common misunderstandings about the concept of “safe spaces,” and the effects of the backlash against political correctness. Roth also recently spoke about his book on Tablet Magazine’s “Unorthodox” podcast. (Roth comes in around 49 minutes).

4. WTIC “Todd Feinberg”: “Richard Grossman”

Richard Grossman, professor and chair of economics, is interviewed about what’s going on with the US economy, why he’s not too worried about prolonged low interest rates, concerns over a recession, and what can be done to fix income inequality.

5. Exhale Lifestyle: “Award-Winning Boston Filmmaker Sparks Conversations About Change”

This profile describes how Tracy Heather Strain, professor of the practice in film studies and co-director of the Wesleyan Documentary Project, became a filmmaker specifically because she wanted to make a film about her longtime idol, Lorraine Hansberry. Like Hansberry, the author of the monumental play A Raisin in the Sun, about black families living under racial segregation in Chicago, Strain is “concerned with contemporary society’s obvious injustices.” Strain earned a Peabody Award for her 2017 documentary about Hansberry, Sighted Eyes/Feeling Heart.

Alumni in the News

1. Chicago Sun-Times: “The Music of Alsarah & The Nubatones Transcends Borders, Cultures”

Mary Houlihan profiles Sarah Elgadi ’04, noting, “From a young age, Alsarah, who fronts the Brooklyn group Alsarah & the Nubatones, found refuge in music.” Elgadi was 12 when her family arrived in United States. “Now, years later, the 37-year-old singer, songwriter, bandleader and ethnomusicologist (she has a degree from Wesleyan University) has forged a career with ties to her background, bringing a fresh sound to world music.”

2. Eureka Alert: ”Study: Adults’ Actions, Successes, Failures, and Words Affect Young Children’s Persistence”

The American Association for the Advancement of Science reports on the study led by Julia A. Leonard ’11, MindCore postdoctoral fellow at the University of Pennsylvania, who observes: “Our work shows that young children pay attention to the successes and failures of the adults around them and, reasonably, don’t persist long at tasks that adults themselves fail to achieve.”

3. Boston.gov: “Dr. Taylor Cain [’11] Appointed to Lead Boston’s Housing Innovation Lab”

In the release announcing her appointment, Cain said: “As the new director, I cannot wait to grow the threads of this work. I am looking forward to partnering with the many communities that care deeply about housing in Boston and exploring projects that grapple with the connections between housing, transportation, employment, and other important dimensions of urban life.”

4. NPR.org: “How UAW’s Strike Against GM May Affect Ford and Fiat-Chrysler”

In this interview with New York Times reporter Steven Greenhouse ’73, P’08, author of Beaten Down, Worked Up: The Past, Present and Future of American Labor, NPR host David Greene asks about the strike that the United Automobile Workers union launched earlier this month in more than 30 factories after failing to reach a deal with GM.

5. Core77: ”frog’s Francois Nguyen [’94] is Actively Helping Shape What the Future Looks Like“

Writer Alexandra Alexa notes in this interview—which is part of a series on the presenters in this year’s Core77 Conference, exploring the future of the design industry—that Nguyen was one of the lead designers of the original “Beats Studio” headphones by Dr. Dre. She writes: “Even when he’s not working, Francois Nguyen never really stops envisioning what the world might look like. More than a decade into his industrial design career, Nguyen knows a thing or two about staying resilient and nimble as the discipline changes.”

6. International Examiner: “‘Carrie Yamaoka [’79]: recto/verso’ is Not So Much About What You See as How it Happens”

Susan Kunimatsu writes about the artist’s retrospective, currently at University of Washington’s Henry Art Gallery through Nov. 3: “Yamaoka is fascinated with transformations, like the moment when exposed photo paper hits the developing chemical and an image starts to appear. Many of her artworks are about capturing that moment.”

Grossman Discusses British Stock Market on Economics Blog

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Grossman

Richard Grossman

Richard Grossman, professor of economics, authored a blog post on the Vox CEPR website with Gareth Campbell and John Turner (Queen’s University Belfast) titled, “New monthly indices of the British stock market, 1829-1929.”

Although long-run stock market data are an important indicator, obtaining them is challenging. This column constructs new long-run broad-based indices of equities traded on British securities markets for the period 1829-1929 and combines them with a more recent index to examine the timing of British business cycles and compare returns on home and foreign UK investment. One finding is that the capital gains index of blue-chip companies appears to be a good bellwether of macroeconomic behavior.

The post is based on their CEPR and Wesleyan Economics Working Paper, “Before the cult of equity: New monthly indices of the British share market, 1829-1929.”

Grossman in The Conversation: May Jobs Report Suggests a Slowing Economy—and Possibly an Imminent Interest Rate Cut

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Richard Grossman

Wesleyan faculty frequently publish articles based on their scholarship in The Conversation US, a nonprofit news organization with the tagline, “Academic rigor, journalistic flair.” In a new article, Professor and Chair of Economics Richard Grossman analyzes the latest jobs report.

May jobs report suggests a slowing economy – and possibly an imminent interest rate cut

The latest jobs data suggests an interest rate cut may be imminent.

The Labor Department reported on June 7 that U.S. nonfarm payroll employment increased by 75,000 in May, while the unemployment rate remained unchanged at 3.6%. This level of job creation was well below economists’ forecasts of about 185,000 new jobs, as well as below the average monthly increase of 164,000 in 2019 and 223,000 in 2018.

Although it’s difficult – even for an economist like me who studies economic policy – to interpret the data reported in any one jobs report as the beginning of a trend, the latest numbers do suggest the Federal Reserve may have to lower its benchmark interest rate to shore up the economy.

That may happen as soon as this month, when the Fed’s interest rate-setting panel, the Federal Open Market Committee, convenes its next meeting June 18-19. A cut would be a sharp reversal from Fed policy as recently as December, when it last raised the rate.

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Wesleyan in the News

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In this recurring feature in The Wesleyan Connection, we highlight some of the latest news stories about Wesleyan and our alumni.

Recent Wesleyan News

  1. The Washington Post: “Major Trump Administration Climate Report Says Damage is ‘Intensifying Across the Country'”

Gary Yohe, the Huffington Foundation Professor of Economics and Environmental Studies, was widely quoted in the media about the fourth National Climate Assessment, the first to be released under the Trump Administration. “The impacts we’ve seen the last 15 years have continued to get stronger, and that will only continue,” Yohe, who served on the National Academy of Sciences panel that reviewed the report, told The Washington Post. “We have wasted 15 years of response time. If we waste another five years of response time, the story gets worse. The longer you wait, the faster you have to respond and the more expensive it will be.” Yohe was also quoted on the report in The Hill, The Verge, Al Jazeera, and many other news sources. He is also professor of economics, and professor, environmental studies.

2. The Hill: “If Brits Don’t Want a Redo on Brexit, They Should”

In this op-ed, Richard Grossman, professor and chair of economics, writes that Brexit, or Britain’s “divorce” from the European Union, is anticipated to “reduce Britain’s economic prospects in both the short and long run and leave the country poorer than it would have been had it remained within the European Union.” He writes: “There is a way out of this mess,” but the difficulties are political, not legal.

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Grossman Comments on the Economic Impact of Brexit

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Richard Grossman

Professor of Economics Richard Grossman was asked by Wales Online about his expectations for the economic impact of Brexit over the next few years. He said:

“Leaving the European Union will be a drag on the British economy in the medium term. Even before Brexit takes effect, however, the economy will be hurt by two factors: expectations and uncertainty.

“The expectation that the UK will no longer have free access to the European market may lead exporters to reorient production toward domestic consumption or export to non-EU regions well before Brexit comes into force. UK-based financial firms may shift operations to EU locations in anticipation of Brexit, rather than waiting until it is a fait accompli.

“And firms that rely on high-skilled labour may relocate to other countries if they expect the reduction in immigration that is expected to accompany Brexit to  reduce the pool of talented workers in the UK.

“In addition to its anticipated effects, the economy will suffer from the uncertainty surrounding Brexit. There really is no precedent for a country to leave the EU, so no one really knows how the negotiations will turn out.

“And markets hate uncertainty. The worse the perceived effect of Brexit, the worse a drubbing the pound will take.

“A steady decline might support exports to some extent, but will lead to inflation at home as imported goods become more expensive. What is more likely than a steady decline is a more volatile pound, which will help no one.”

 

Grossman Presents Paper at the Bank of England

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Richard Grossman

On June 23, Professor of Economics Richard Grossman presented a paper at an economic history symposium jointly sponsored by the Bank of England and the the Centre for Economic Policy Research. Titled, “Beresford’s Revenge: British equity holdings in Latin America, 1869-1929,” the paper looks at stock market returns of Latin American firms traded on the London Stock Exchange.

The program for the conference can be seen here.

Grossman Argues Truth Was Lost in the Election

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Richard Grossman

Richard Grossman

Professor of Economics Richard Grossman tells his students that getting closer to the truth is what economic research is all about. That’s why he was so dismayed when “my devotion to, and belief in, the truth was battered by the presidential election,” he writes in an op-ed on The Hill.

He writes:

It turns out that polling data and analysis contained very little truth. The news were no better. The mainstream media got many things wrong. And there was no shortage of fake news. Although peddled as the real thing, it really wasn’t even trying to provide truth, only to shape opinion.

But by far the biggest letdown in the truth department was Donald Trump, who proved that telling lie upon lie upon lie need not prevent someone from being elected president.

“What should the truth-loving public do going forward?” Grossman asks.

First, pay attention to sources. It is relatively easy to construct a realistic website that has the look and feel of a real news organization or reputable think tank. Do not be fooled. If someone tells you something about the state of employment in the United States, double check facts at Bureau of Labor Statistics’ website. The U.S. government is the best, most reliable source for factual data about the nation’s economy. Obama didn’t fudge the numbers, and Trump is unlikely to be able to do so.

Second, even relatively trusted new sources have their less trustworthy bits. In print media, the division between truth and opinion is usually clear. You can generally trust what you read in the Wall Street Journal, until you get to the opinion pages. Television networks are less clear about separating fact from fiction. CNN’s hiring of Trump campaign employee Corey Lewandowski—while he was on the Trump payroll and still subject to a non-disclosure agreement—should have set off alarm bells among CNN viewers, not to mention the better journalistic instincts of CNN’s management.

Third, be demanding. I encourage my students to challenge the authors that they read in class, including me. Ask questions, check sources and verify the truth for yourself. Just because something has been shared on Facebook a million times does not mean it is true. We should challenge the assertions of politicians of all stripes just as vigorously.

Finally, we need to care more about the truth. One of the most troubling aspects of the election was that so many people voted for Trump despite being fully aware of his many lies because “he shouldn’t be taken literally.” At the risk of sounding naive again, approaching national elections with the attitude that outright lies don’t matter does not bode well for the future of our democracy.