Jorge Barro

Economist @recentertx | Nonresident Fellow @BakerInstitute | Macro, capital markets, public finance, real estate.

[Jorge Barro @jorge_barro]

The current post-pandemic expansion recently completed its 74th month, surpassing the 2001-2007 expansion (73 months).

Of the 34 NBER-dated expansions, only 5 have lasted longer.

The good news is that 3 of those 5 happened in the last 4 completed expansions.

Expansions are getting longer, and empirical evidence is beginning to support that.

So while a 74-month expansion is unusual, the trend favors a little more life on this one.

[Jorge Barro @jorge_barro]

Steep drop in CPI today. Not all inflation shocks are driven by supply-side factors, but we could have been fairly certain this one was.

For as long as geopolitical tensions continue to drive this inflation cycle, keep an eye on the NY Fed's Global Supply Chain Pressure Index.

[Jorge Barro @jorge_barro]

Big tick down in the GSCPI indicates an improvement in the inflation outlook.

[Jorge Barro @jorge_barro]

True IMO. Also, providing Anthropic with compute was a prudent A.I. hedge.

[Elon Musk @elonmusk]

I was clearly wrong about Anthropic. They are obviously currently the leader in AI. No company has released a model as good as Mythos/Fable and they will undoubtedly have Mythos 2 ready soon.

And I would never cut them off in a way that hurt them badly, even as a competitor. That’s not my style.

Tesla open sourced its patents and we made the Supercharger network available to all competitors, even though we could have made it a walled garden.

SpaceX launches competing satellite systems with no increase in price or use of unfair terms.

Even my worst enemies can attack me on this platform.

…

[Jorge Barro @jorge_barro]

For context, CPI vs GSCPI, QoQ

[Jorge Barro @jorge_barro]

If the US-Iran peace deal holds, inflation could begin to fall in the coming months.

Would inflation fall as quickly as it rose recently?

Some argue no, but keep an eye on the Global Supply Chain Pressure Index published by the @NYFedResearch, one of the key leading indicators of the impact of global supply strains on inflation.

https://t.co/Lk3nI8O2Gi

[Jorge Barro @jorge_barro]

Big tick down in the GSCPI indicates an improvement in the inflation outlook.

[New York Fed Research @NYFedResearch]

GLOBAL SUPPLY CHAIN PRESSURE INDEX
The GSCPI fell to 1.25 in June, down from 1.81 in May.
https://t.co/yvUaNhyVBk

[Jorge Barro @jorge_barro]

Read more in my latest article:

https://t.co/tHFNDxMteO

[Jorge Barro @jorge_barro]

The current post-pandemic expansion recently completed its 74th month, surpassing the 2001-2007 expansion (73 months).

Of the 34 NBER-dated expansions, only 5 have lasted longer.

The good news is that 3 of those 5 happened in the last 4 completed expansions.

Expansions are getting longer, and empirical evidence is beginning to support that.

So while a 74-month expansion is unusual, the trend favors a little more life on this one.

[Jorge Barro @jorge_barro]

Clear improvement to start 2026, but the outlook remains uncertain. Unemployment ticked down, but the labor force also declined. Hiring expectations (Atl Fed SBU) have cooled from their February peak but remain above 2025 levels—cautious optimism for the coming months.

[Jorge Barro @jorge_barro]

Today’s NFP came in below expectations, +57K actual vs +115K expected, with downward revisions to April (-31K) and May (-43K). Surprising losses concentrated in Leisure & Hospitality. Education and Health continue comprising the bulk of gains. Still, a few key industries rebounded from 2025 dip in the first half of 2026…

[Jorge Barro @jorge_barro]

Professional & Business Services, which thrived in the post-covid boom, is rebounding after sustained losses in 2025. Trade, Transportation, and utilities—a volatile labor market—is also trending higher after 2025 losses, possibly tariff-related delays and restructuring. Finally, government jobs show some recovery after the DOGE-related cuts in 2025.

[Jorge Barro @jorge_barro]

The steep decline and subsequent surge in mortgage rates after the pandemic caused a broad “lock-in” effect, where homeowners with low mortgage rates are reluctant to move.

I’ve often thought that, on net, buyers would prefer upsizing from smaller to larger homes.

This research suggests the opposite—more buyers would prefer downsizing from their larger homes.

If rates decrease, smaller homes could experience a disproportionate surge in demand.

Critical research for policymakers, homebuilders, and anyone thinking about moving.

[The Wharton School @Wharton]

Homeowners stuck with low fixed mortgage rates aren't just frozen in place — they're propping up the housing market, according to new research.

@WhartonKnows highlights a paper co-authored by Prof. @luliu_fin, @giesbusiness's @JuliaAFonseca, and @INSEAD's Pierre Mabille, which argues that mortgage lock-in fuels housing demand due to missing downsizers — people in larger homes who would have sold and moved to something smaller: https://t.co/DTyK96vCuV

The result is a net increase in housing demand, enough to offset about a third of the price decline that higher rates would otherwise have produced.

[NBER @nberpubs]

Open call for papers, Macroeconomic Effects of Population Aging. Conference to be held virtually on September 18, 2026. Submit papers by 11:59pm EDT on August 5, 2026. More information: https://t.co/zGRmCAOka5

[Jorge Barro @jorge_barro]

One thing I always recalled after reading Greenspan’s bio (Maestro) years ago was his willingness to pick up the phone and get a pulse on the economy by speaking with business leaders.

Today, the Fed district banks have formalized that process through a series of regional and national business surveys.

RIP to a great one.

[Nick Timiraos @NickTimiraos]

Alan Greenspan has died at 100. During his 18½ years leading the Fed, he reached rock-star heights and shaped the U.S. economy under presidents of both parties. Milton Friedman called him the greatest of all time. 2008 recast his legacy.

[Jorge Barro @jorge_barro]

If the US-Iran peace deal holds, inflation could begin to fall in the coming months.

Would inflation fall as quickly as it rose recently?

Some argue no, but keep an eye on the Global Supply Chain Pressure Index published by the @NYFedResearch, one of the key leading indicators of the impact of global supply strains on inflation.

https://t.co/Lk3nI8O2Gi

[Jorge Barro @jorge_barro]

Read more in my latest blog: https://t.co/snhDwwc6KN

[Jorge Barro @jorge_barro]

How could new Fed Chair Kevin Warsh's monetary policy positions affect the housing market?

In 2021, he said the Fed should stop buying mortgage securities immediately. It bought $500 billion more anyway.

As Chair, he'd push back against that kind of prolonged MBS expansion, which could mean more price stability in the housing market.

[Jorge Barro @jorge_barro]

A GDP read of 3.3% would be in line with the Q2 2026 job growth (1-1.5%) + heightened productivity (2-3%) in recent years.

[Atlanta Fed @AtlantaFed]

On June 9, the #GDPNow model nowcast of real GDP growth in Q2 2026 is 3.3%: https://t.co/T7FoDdgYos. #ATLFedResearch

Download our EconomyNow app or go to our website for the latest GDPNow nowcast: https://t.co/JPMzsC5TNo

[Jorge Barro @jorge_barro]

https://t.co/mSWehpipk4

[Jorge Barro @jorge_barro]

The labor market looked bleak in late 2025, but business sentiment survey data had indicated a rosy outlook in 2026. Surveys now point to moderate job growth in the year ahead, though the NFIB hiring outlook took a noticeable dip this month.

[Jorge Barro @jorge_barro]

The jobs report today shows a steady deterioration of labor market conditions. Jobs growth continued trending downward, and the unemployment rate continued creeping up. But—could the business sentiment data be signaling a looming improvement? 🧵

[Jorge Barro @jorge_barro]

Analysis released earlier this year shows similar results in Table 3: https://t.co/ASOYgc3cUm

[Jorge Barro @jorge_barro]

One of the first projects when we developed the @BudgetModel was to evaluate the macro effects of revenue increases vs benefit cuts. While the behavioral responses were different, both raised long-run growth through debt reduction's impact on private capital.

[Mike Bird @Birdyword]

I wrote about the Social Security trust fund this week, which is set to run dry some time in 2032-33. The fund has been saved before, notably in 1983 by a bipartisan deal that broadened the tax base and raised the retirement age. Ask yourself: can you imagine such a deal now?