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The Most Counterintuitive Recession Ever (A Wealth of Common Sense, 4 min read) In 2Q household debt and delinquency of these debts has fallen in the US. Personal saving remains high. The stock market is near all-time highs. The real estate market is in good shape, too. Unprecedented fiscal and monetary stimulus released in record time made this the strangest recession.
The Value of Luck in the Labour Market for CEOs (NBER, 27 page read) CEOs of S&P 500 companies typically receive $14 million a year for their expertise. Sometimes, however, firm values swing regardless of CEO actions (i.e. ‘luck’). When this happens, lucky CEOs are more likely capitalise by moving to firms with low analyst coverage and that operate in less competitive industries. The result for them is higher pay, but the result for the new firm is poorer performance.
Potential Consequences of Post-Brexit Trade Barriers for Earnings Inequality in the UK (IFS, 29 page read) Who is set to miss out most following Brexit? Blue collar and lower-paid workers. These individuals are exposed to the negative consequences of higher trade costs and are less likely to have good alternative employment opportunities available in their local labour markets.