1.0Verbank Advisors & Agriculturehttps://verbank.luverbankfarmshttps://verbank.lu/author/verbankfarms/rich600338<blockquote class="wp-embedded-content"><a href="https://verbank.lu/august72017/">US + Brazil Financial News (8/7)</a></blockquote> <script type='text/javascript'> <!--//--><![CDATA[//><!-- /*! This file is auto-generated */ !function(c,d){"use strict";var e=!1,n=!1;if(d.querySelector)if(c.addEventListener)e=!0;if(c.wp=c.wp||{},!c.wp.receiveEmbedMessage)if(c.wp.receiveEmbedMessage=function(e){var t=e.data;if(t)if(t.secret||t.message||t.value)if(!/[^a-zA-Z0-9]/.test(t.secret)){for(var r,a,i,s=d.querySelectorAll('iframe[data-secret="'+t.secret+'"]'),n=d.querySelectorAll('blockquote[data-secret="'+t.secret+'"]'),o=0;o<n.length;o++)n[o].style.display="none";for(o=0;o<s.length;o++)if(r=s[o],e.source===r.contentWindow){if(r.removeAttribute("style"),"height"===t.message){if(1e3<(i=parseInt(t.value,10)))i=1e3;else if(~~i<200)i=200;r.height=i}if("link"===t.message)if(a=d.createElement("a"),i=d.createElement("a"),a.href=r.getAttribute("src"),i.href=t.value,i.host===a.host)if(d.activeElement===r)c.top.location.href=t.value}}},e)c.addEventListener("message",c.wp.receiveEmbedMessage,!1),d.addEventListener("DOMContentLoaded",t,!1),c.addEventListener("load",t,!1);function t(){if(!n){n=!0;for(var e,t,r=-1!==navigator.appVersion.indexOf("MSIE 10"),a=!!navigator.userAgent.match(/Trident.*rv:11\./),i=d.querySelectorAll("iframe.wp-embedded-content"),s=0;s<i.length;s++){if(!(e=i[s]).getAttribute("data-secret"))t=Math.random().toString(36).substr(2,10),e.src+="#?secret="+t,e.setAttribute("data-secret",t);if(r||a)(t=e.cloneNode(!0)).removeAttribute("security"),e.parentNode.replaceChild(t,e)}}}}(window,document); //--><!]]> </script><iframe sandbox="allow-scripts" security="restricted" src="https://verbank.lu/august72017/embed/" width="600" height="338" title="“US + Brazil Financial News (8/7)” — Verbank Advisors & Agriculture" frameborder="0" marginwidth="0" marginheight="0" scrolling="no" class="wp-embedded-content"></iframe>UNITED STATES   Another month, another NFP report, and the same controversy. This has been an unusually long cycle, in its ninth year, after an unusual recession led by a financial crash and crisis-led deleveraging. The cycle coincided with and/or reinforced structural shifts in the US economy that brought about a lower level of potential growth and, seemingly, a near-permanent shift in the yield curve. The structural real neutral rate is close to zero, if not negative. Moreover, the flatness of the Phillips curve relationship between the output gap and inflation not only survived. If recent empirical evidence is to be believed, it became more pronounced—and entrenched. The argument is that, if the Fed waited to act based on the Phillips curve, it would act too late. Inflation would then be ingrained, and only a deeper recession could cure it. Thus, many argue, it is wrong to focus on measures of the output gap. The preferred measure, instead, is to focus directly on the unemployment gap: The distance between the observed unemployment rate and the NAIRU.What the unemployment gap shows is that the economy is at full employment; i.e., no further slack, notwithstanding any possible lingering controversy about the participation rate. So, […]