🦜 Liberty Street Economics
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Stress and Strain from NBFIs to Banks
https://libertystreeteconomics.newyorkfed.org/2026/05/stress-and-strain-from-nbfis-to-banks/
Published: May 8, 2026 11:00
Do the recent stresses in the NBFI space—notably the bankruptcies of Tricolor and First Brands, and the decision of Blue Owl Capital Corp II (OBDC II) to end its redemption program and return capital through a wind-down of the fund—create distress for…
Same Shock, Different Roads? A K‑Shaped Pattern at the Pump
https://libertystreeteconomics.newyorkfed.org/2026/05/same-shock-different-roads-a-k-shaped-pattern-at-the-pump/
Published: May 6, 2026 15:30
In March 2026, energy prices surged to a four-year high, driven by the Iranian closure of the Strait of Hormuz amid the ongoing conflict in the Middle East. In this Liberty Street Economics post, we use the new consumer spending module of the Economic…
In What Ways Has U.S. Trade with China Changed?
https://libertystreeteconomics.newyorkfed.org/2026/05/in-what-ways-has-u-s-trade-with-china-changed/
Published: May 4, 2026 11:00
Over the past year, U.S. trade policy with China has undergone enormous changes, but with surprisingly little effect on overall trade balances. In fact, the U.S.’s twelve-month trade deficit, while highly volatile due to import front-running early in the…
Explaining the K‑Shaped Economy: What’s Behind the Divide?
https://libertystreeteconomics.newyorkfed.org/2026/05/explaining-the-k-shaped-economy-whats-behind-the-divide/
Published: May 1, 2026 14:01
In our companion post, we used a new module of our Economic Heterogeneity Indicators (EHIs) to shed light on how recent retail spending growth has been driven by high-income households. This fact is consistent with the popular press’s idea of a “K-shaped…
Tracking the K‑Shaped Economy: Who’s Driving Spending?
https://libertystreeteconomics.newyorkfed.org/2026/05/tracking-the-k-shaped-economy-whos-driving-spending/
Published: May 1, 2026 14:00
Aggregate real consumer spending has risen solidly since 2023. However, it is less clear how widely shared this improvement has been across all segments of society. This is important because systematic heterogeneity may mask the dependence of aggregate…
Bank Failures: The Roles of Solvency and Liquidity
https://libertystreeteconomics.newyorkfed.org/2026/04/bank-failures-the-roles-of-solvency-and-liquidity/
Published: April 16, 2026 14:00
Do banks fail because of runs or because they become insolvent? Answering this question is central to understanding financial crises and designing effective financial stability policies. Long-run historical evidence reveals that the root cause of bank…
The R*–Labor Share Nexus
https://libertystreeteconomics.newyorkfed.org/2026/04/the-r-labor-share-nexus/
Published: April 15, 2026 11:00
Over the past quarter century, the U.S. economy has experienced significant declines in both the labor share of income and the natural rate of interest, referred to as R*. Existing research has largely analyzed these two developments in isolation. In this…
Use of Gen AI in the Workplace and the Value of Access to Training
https://libertystreeteconomics.newyorkfed.org/2026/04/use-of-gen-ai-in-the-workplace-and-the-value-of-access-to-training/
Published: April 14, 2026 14:30
The rapid spread of generative AI (AI) tools is reshaping the workplace at a remarkable rate. Yet relatively little is known about whether workers have access to these tools, how the tools affect workers’ daily productivity, and how much workers value the…
What Millions of Homeowner’s Insurance Contracts Reveal About Risk Sharing
https://libertystreeteconomics.newyorkfed.org/2026/04/what-millions-of-homeowners-insurance-contracts-reveal-about-risk-sharing/
Published: April 13, 2026 11:00
Housing is the largest component of assets held by households in the United States, totaling $48 trillion in 2025. When natural disasters strike, the resulting damage to homes can be large relative to households’ liquid savings. Homeowner’s insurance is…
A Closer Look at Emerging Market Resilience During Recent Shocks
https://libertystreeteconomics.newyorkfed.org/2026/04/a-closer-look-at-emerging-market-resilience-during-recent-shocks/
Published: April 9, 2026 11:00
A succession of shocks to the global economy in recent years has focused attention on the improved economic and financial resilience of emerging market economies. For some of these economies, this assessment is well-founded and highlights the fruits of…