Search Results
Working Paper
Using the Eye of the Storm to Predict the Wave of Covid-19 UI Claims
We leverage an event-study research design focused on the seven costliest hurricanes to hit the US mainland since 2004 to identify the elasticity of unemployment insurance filings with respect to search intensity. Applying our elasticity estimate to the state-level Google Trends indexes for the topic “unemployment,” we show that out-of-sample forecasts made ahead of the official data releases for March 21 and 28 predicted to a large degree the extent of the Covid-19 related surge in the demand for unemployment insurance. In addition, we provide a robust assessment of the uncertainty ...
Working Paper
Tracking U.S. Consumers in Real Time with a New Weekly Index of Retail Trade
We create a new weekly index of retail trade that accurately predicts the U.S. Census Bureau’s Monthly Retail Trade Survey (MRTS). The index’s weekly frequency provides an early snapshot of the MRTS and allows for a more granular analysis of the aggregate implications of policies implemented during the Covid-19 pandemic. To construct the index, we extract the co-movement in several weekly data series capturing credit & debit card transactions and revenues, mobility, and consumer sentiment as well as monthly retail and food services sales excluding automotive spending (ex. autos) from the ...
Working Paper
Using the Eye of the Storm to Predict the Wave of Covid-19 UI Claims
We leverage an event-study research design focused on the seven costliest hurricanes to hit the US mainland since 2004 to identify the elasticity of unemployment insurance filings with respect to search intensity. Applying our elasticity estimate to the state-level Google Trends indexes for the topic “unemployment,” we show that out-of-sample forecasts made ahead of the official data releases for March 21 and 28 predicted to a large degree the extent of the Covid-19 related surge in the demand for unemployment insurance. In addition, we provide a robust assessment of the uncertainty ...
Newsletter
A “Big Data” View of the U.S. Economy: Introducing the Brave-Butters-Kelley Indexes
We describe a new set of indexes?the Brave-Butters-Kelley Indexes (BBKI)?constructed from a large panel of monthly macroeconomic time series and quarterly real gross domestic product (GDP) growth. Through August, these indexes suggest that real GDP growth was somewhat below its long-run trend to start the third quarter and that its business cycle component had declined noticeably in recent months despite some indications of improvement in its leading indicators.
Working Paper
Tracking U.S. Consumers in Real Time with a New Weekly Index of Retail Trade
We create a new weekly index of retail trade that accurately predicts the U.S. Census Bureau's Monthly Retail Trade Survey (MRTS). The index's weekly frequency provides an early snapshot of the MRTS and allows for a more granular analysis of the aggregate consumer response to fast-moving events such as the Covid-19 pandemic. To construct the index, we extract the co-movement in weekly data series capturing credit and debit card transactions, mobility, gasoline sales, and consumer sentiment. To ensure that the index is representative of aggregate retail spending, we implement a novel ...
Working Paper
Calibrating Macroprudential Policy to Forecasts of Financial Stability
The introduction of macroprudential responsibilities at central banks and financial regulatory agencies has created a need for new measures of financial stability. While many have been proposed, they usually require further transformation for use by policymakers. We propose a transformation based on transition probabilities between states of high and low financial stability. Forecasts of these state probabilities can then be used within a decision-theoretic framework to address the implementation of a countercyclical capital buffer, a common macroprudential policy. Our policy simulations ...
Journal Article
A New “Big Data” Index of U.S. Economic Activity
The authors present a new ?big data? index of U.S. economic activity that can be used to track business and inflation cycles in real time and estimate monthly real gross domestic product growth.
Newsletter
Measuring Detroit’s Economic Progress with the DEAI
This article explains what the Detroit Economic Activity Index (DEAI) tells us about Detroit’s economic progress as of late 2019. Although the rate of progress had slowed some since 2016, the city continued to make headway last year in its recovery from bankruptcy.In a previous Chicago Fed Letter,1 we introduced the DEAI to show that Detroit was doing better in late 2016 than in late 2014, when it exited bankruptcy. According to the DEAI, there were signs of increasing private investment, higher employment, lower unemployment, rising incomes, and improving real estate values in December ...
Newsletter
The Stay-at-Home Labor Market: Google Searches, Unemployment Insurance, and Public Health Orders
This article looks at the relationships between internet searches for unemployment-related terms, unemployment insurance (UI), and the public health orders issued in the U.S. during the Covid-19 pandemic. We find that Google searches for unemployment-related subjects surged before the record increase in initial UI claims, which in turn peaked before the public health orders were implemented. As of mid-April 2020, these orders covered the vast majority of the U.S. population. Since then, the rates of increase in both search activity and initial UI claims have slowed.
Measuring the Decline in Economic Activity During the Covid-19 Pandemic
On June 8, 2020, the National Bureau of Economic Research (NBER) issued a statement announcing that its Business Cycle Dating Committee determined U.S. economic activity had reached a cyclical peak in February 2020. Beginning in March 2020, a multitude of economic indicators declined sharply as public health orders that required nonessential businesses to close were implemented during the early stages of the Covid-19 pandemic here in the U.S. The declines then accelerated in April as these orders were expanded to cover nearly the entire country. However, the data for May released so far seem ...