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CONSUMER DIARY


By Harlan Levy

  Let sleeping infants lie ... without blankets.

 

A friend recently asked my wife and me if we were expecting grandchildren. My wife answered, “Not yet,” adding that our son and his wife are trying.

The conversation made me remember what having children entailed — the tough nights, little sleep, diapers (which I changed), daytime needs, all that.

And the next day, I received a report on fatal infant sleep practices, which pointed out some things parents (and grandparents) should know.

The report, Trends and Disparities in Infant Safe Sleep Practices 2009-15, released this month by the Centers For Disease Control and Prevention, stated that there have been dramatic improvements in reducing infant sleep-related deaths since the 1990s, when the recommendation was made to place infants on their backs for sleep. However, the decline has, alarmingly, recently slowed significantly, the CDC said.

Approximately 3,500 sleep-related infant deaths occur each year in the U.S., from sudden infant death syndrome, accidental suffocation, strangulation in bed, and unknown causes, the report says.

The rate of infant sleep-related deaths declined from 154.6 deaths per 100,000 live births in 1990 to 93.9 per 100,000 live births in 1999, In 2015, the rate of infant sleep-related deaths was 92.6 deaths per 100,000 live births.

Unsafe sleep practices that continue to cause fatalities include placing infants in non-supine positions — on their sides or stomachs — bed sharing, and using blankets, pillows, stuffed toys, and other soft objects in cribs.

The report’s findings from surveys in 2015, the latest year for the data, include:

• 21.6 percent of respondents from 32 states and New York City place their infants in a non-supine sleep position, ranging from 12.2 percent in Wisconsin to 22.7 percent in Connecticut to 33.8 percent in Louisiana.

• Based on data from 15 states, placement of infants in a non-supine sleep position decreased significantly from 27.2 percent in 2009 to 19.4 percent in 2015. However, 61.4 percent from 14 states reported sharing a bed with their infant.

• In Connecticut 33.8 percent rarely or sometimes shared a bed with an infant, 19.1 percent did so often or always, and 47.1 percent never did it.

• 38.5 percent from 13 states and New York City reported using soft bedding — bumper pads, thick blankets, stuffed toys, etc. Connecticut results were not available.

• Infant non-supine sleep positioning was highest among respondents who were under age 25 and who had completed less than 12 years of education.

Best practices

The report recommends:

• Place infants on their backs on a firm sleep surface such as a mattress in a safety-approved crib or bassinet.

• Have infant and caregivers share a room, but not the same sleeping surface, for the first six months.

• Avoid soft bedding (blankets, pillows, and soft objects) in the infant sleep space.

• Breast feeding, routinely recommended immunizations, and avoiding exposure to tobacco smoke, alcohol, and illicit drugs.

Now you know.


INTERVIEW: EONOMY, STOCKS, OUTLOOK

 

U.S. economy losing momentum nearing full capacity, not from financial or confidence downturn.

If Trump tax cuts cause big budget deficits, Fed will accelerate rate-tightening..

Corporations will use tax cuts to buy financial assets, not industrial development.

No major industrial development with Trump not funding infrastructure overhaul, just talking.

Stocks overvalued

Mid-2020s when Trump deregulation may cause financial, environmental crises if not reversed quickly.

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Andres Carbacho-Burgos is a senior economist at Moody’s Analytics. Previously he was an economics professor at Texas State University.

Harlan Levy: What do you think of the January job numbers, up 200,000?

Andres Carbacho-Burgos: They were good, about what we expected, and they indicate that the U.S. economy is still able to create jobs at a good clip. So we’re not close to recession any time soon.


H.L.: But wage increases were infinitesimal. What’s your take on that?

A.C-B.: I’ve always thought that there’s relatively little relationship with how many jobs are added and what happens to wages.

The labor market has to be extremely tight, even tighter than it is now before we really start to push up wages. That depends on how long the Federal Reserve will take to tighten interest rates, and a lot depends on how much weight it places on wage growth as opposed to the unemployment rate or other metrics of employment capacity. If the Fed looks at wage growth only, then it will be more hesitant to raise interest rates, and that will help somewhat, and we’ll have a tight labor market for longer.


H.L.: Is the U.S. economy losing momentum?

A.C-B.: It’s starting to lose momentum only because it’s starting to run into supply-side constraints. The labor market is tight, and residential construction is right now increasing as fast as it can go. We’ve had steady increases in completions over the last four or five years, but I don’t see that steady rate of residential completions increasing over the next year or two. The economy is starting to lose momentum but not necessarily because there’s any financial downturn or confidence losses yet, but mainly because we’re starting to get to full capacity.


H.L.: How long do we have before the economy starts sputtering?

A.C-B.: There are two types of downturns in the U.S. The first is caused by financial crises, as in 2007 and 2008, from bad lending and deregulation.

The second type is a recession induced by the Fed tightening rates, rightly or wrongly, to brake inflation. That’s the recession we’re most likely to see in the next four or five years. That’s why I think the Fed should not tighten rates until it gets serious evidence of wage inflation or price inflation.

Moody’s Analystics predict that by 2020 or so, the Fed will finish tightening rates. That’s when the economy will slow down the most and be at the greatest risk of a downturn. We’re thinking there’s around a 25 percent risk of a recession in 2020. It’s definitely a downside risk.

The baseline forecast also predicts slightly better growth after 2020, because the Fed would no longer be tightening rates.

That’s a signal to people that if they can buy a home or if they haven’t yet refinanced your home, you should do so now if you’re able to.


H.L.: How is the housing market doing?

A. C-B.: Housing up to now has been doing relatively well. Home sales are increasing somewhat. Single-family construction is still doing relatively well, increasing at a fairly steady rate. House prices up to now have been increasing around 5 percent, maybe slightly per year.

Housing is always a significant part of the economy. The question is whether housing is going to stay at a steady state or moving into a dramatic depressive situation, with the latter case what you need to fear.

What’s happening with the Republican tax cuts is that they are going to push the housing market more in the direction of a depressive state, which would significantly slow down house price growth and actually act as a brake to some extent on home sales, so the effect on house-price growth will be more pronounced.

That’s a signal to people who want to buy a home or refinance their home to do so now.

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H.L.: Do you think the tax cuts -- mostly for the wealthy and corporations – will prove that the long-disputed trickle-down theory actually works?

A.C-B.: There’s a huge debate on the idea behind the tax cuts – that they would generate more capital inflows into the U.S., but I’m skeptical that they will make a huge difference.

The U.S. already has a large degree of capital inflows due to the side-effects of the bond market in general and to a lesser extent the stock market. To the extent that capital flows in it will go mainly to purchasing financial assets. I tend to be doubtful that any significant amount of capital will go into industrial development.

That would change if the state and local governments got serious about improving U.S. infrastructure as opposed to just using it as a talking point. But what’s happening now is that most state governments are budget-constrained and can’t engage in significant increases in infrastructure spending, and the Trump administration has just been using infrastructure improvement as a talking point and showed little will to actually put down real dollars for it. Also, I don’t see any move by private industries to engage in a significant investment effort.


H.L.: Do you see a stock market correction any time soon?

A.C-B.: We do believe that stocks are somewhat overvalued currently. We predict that between mid-2018 and late in 2019 that the S&P 500 will correct around 10 percent. That’s not a huge crash, but it’s an indication that most analysts believe that the stock market is currently overvalued and can’t sustain the pace it’s been growing at for the last two years.

H.L.: What sectors look healthy and which ones are weak?

A.C-B.: Financial and professional services and advanced information services, including software design and computer hardware design are the sectors that keep the U.S. economy going are doing relatively well. I don’t see them going into decline in the near future.

Sectors that look weak are related to retail, which is experiencing an industrial transition due to the shift to online shopping and delivery rather than on-site purchases. So retail is continuing a slowdown in growth.


H.L: What do you see as the effect on the U.S. economy of the Trump administration’s cutbacks in financial and environmental regulation?

A.C-B.: As for the U.S. business cycle, relatively little over the next three or four years, when you add the tax overhaul into the mix. Looking at the 2020 presidential election, the changes will not have had a significant effect on the economy.

The chickens will come home to roost at least five or six years down the line, when a significant share of bankers who were active during the Great Recession to head into retirement. Lending will get looser, so in the mid-2020s, that’s when I think the Trump’s deregulation policies might actually help precipitate a financial crisis if they’re not reversed.

Similarly, at around the mid-2020s when any new administration will have to face the consequences of the Republican tax overhaul if they’re not reversed pretty quickly. And that’s when we will be adding up the environmental costs of not regulating pollution and waste-dumping as much as we did during the Obama years.