A0245
Title: Growth at risk is investment at risk
Authors: Michael McCracken - Federal Reserve Bank of St. Louis (United States) [presenting]
Aaron Amburgey - Northwestern University (United States)
Abstract: The role financial conditions play in the composition of U.S. growth-at-risk is investigated. It is documented that by a wide margin, growth-at-risk is investment-at-risk. That is, if financial conditions indicate U.S. real GDP growth will be in the lower tail of its conditional distribution, it is known that the main contributor is a decline in investment. Consumption contributes only under extreme financial stress. Government spending and net exports do not play a role.
