Fed Bubble Risk, Forecasting Edge, Trade-War Analogies: Eco Day

(Bloomberg) -- Go inside the global economy with Stephanie Flanders in her new podcast, Stephanomics. Subscribe via Pocket Cast or iTunes.

Good morning Americas. Here’s the latest news and analysis from Bloomberg Economics to help get your Tuesday started:

  • Some Federal Reserve policy makers seem resigned to running a heightened risk of asset bubbles and other financial excesses as they seek to keep the economic expansion going
    • That’s coming as the Fed is losing its forecasting edge versus private economists, according to Goldman Sachs. They say the higher quality and quantity of private forecasters makes it harder for anyone, including Fed staff, to beat the “wisdom of the crowd”
    • Meanwhile, Donald Trump shelved his plan to appoint Herman Cain to the Fed and Democrats are urging Republicans to also block the president’s other pick, Stephen Moore
  • Trump’s top economist has a new analogy for those bemoaning the impacts of the administration’s trade wars: Just think of the U.S. economy as an 18th century warship battling a scurvy outbreak
  • Softening demand is keeping U.S. homes on the market longer and homeowners appear to be thinking twice about listing their properties, according to the Zillow Real Estate Market Report for March
  • Long-term borrowing costs in the U.S. and Canada edged into restrictive territory in 2018 before returning to an accommodative position in the opening months of 2019. That’s the main finding of Bloomberg Economics’ study of neutral rates across major advanced economies
  • Two of the earliest indicators for Asian trade continued pointing down, undercutting hopes for a rebound as the U.S. and China head toward a settlement. Slowing sales at Caterpillar, a bellwether for the world economy, are likely to add to angst over global growth
  • The Bank of Japan heads into this week’s policy board meeting with downside risks alive and well -- though not as menacing as before China’s economy showed signs of stabilizing, says Yuki Masujima

©2019 Bloomberg L.P.