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The FRED® Blog

Consols: The never-ending bonds

FRED just added an exciting new dataset from the Bank of England: Three Centuries of Macroeconomic Data in the United Kingdom. It provides, among many others, a series on the yields of consols. These are bonds without a maturity date. Pardon? Well, that means there’s no scheduled date for final redemption, until the government decides to pay it back, and coupon payments are made until that time. Consols were first introduced in 1751 at 3.5% and have been in circulation ever since, although interest rates have varied. In 2015, the British government decided to redeem all consols in circulation.

A consol is like a stock, in that it last forever…or until the debtor decides to buy it back. However, consols have a fixed interest rate, while stocks have varying dividends. Consols are also considered to be bonds and thus have seniority over stocks in cases of bankruptcy. Another unconventional debt instrument that comes close to consols is the 100-year mortgage introduced in Japan in the 1980s to try to make homes more affordable.

How this graph was created: Search for “consol” and you should find the series among the first results.

Suggested by Christian Zimmermann.

View on FRED, series used in this post: YCLTUK

Of the people: Federal and local government employment

Here, FRED shows us the total number of U.S. federal government employees over time. Take a minute to examine the graph… For one thing, it sure is spikey. The highest level was during World War II, and the next highest was during the war in Korea. Clearly, war has driven this type of employment. There are also short spikes every ten years, which correspond to temporary hires for the census, including the spike in April 2009. Overall, these spikes have grown as the U.S. population has grown. What may be surprising is that there hasn’t been any significant upward trend, despite substantial population growth—in fact, the U.S. population has more than doubled over this period.

The graph below shows state and local government employment, and the story here is quite different: Except during the recent recessions, both these have grown steadily, despite the fact their growth isn’t affected by wars or the census.

How these graphs were created: Look for the Current Employment Statistics (Establishment Data) releases and select Table B-1. Choose “Federal, except U.S. Postal Service” for the first graph. For the second graph, select the three series shown and add them to the graph.

Suggested by Christian Zimmermann.

View on FRED, series used in this post: CES9091100001, CES9092000001, CES9093000001

To your health! The price of French wine

Today, France celebrates its national holiday. So we take this opportunity to write about… French wine. Oui. FRED does have a price index for French wine. And because prices are always relative to something else, we compare this index with the general price level of consumption goods in France (the blue line). We see that, in relative terms, the price of wine has increased, which sounds bad for the local population. But we can also compare the price of wine with the typical French hourly wage (the red line): There we see that wine has become more and more affordable for the French, which is a reason to celebrate.

How this graph was created: Search for “French wine” and open the graph. In the “Edit Graph” panel, add France’s general price index in the “Customize Data” section. Searching for “France CPI” should do the trick. Once you have both series, apply the formula a/b. In the “Add Line” tab, search again for “French wine” (which may appear among your recently viewed options). Then under “Edit Line 2” add the wage series by searching for “French wage.” Choose the quarterly series for all activities and apply the same a/b formula again. Viola!

Suggested by Christian Zimmermann.

View on FRED, series used in this post: CP0000FRM086NEST, CP0212FRM086NEST, LCWRTT01FRQ661N

Job JOLTS: How long does it take to hire someone?

The JOLTS release in FRED (Job Openings and Labor Turnover Survey) offers a wealth of information about the U.S. labor market, including transitions in and out of employment. The data on job openings are actually very difficult to obtain because employers don’t necessarily advertise or register job openings, so the JOLTS release is especially useful. In the graph above, we use the data to compute a particular ratio, dividing job openings by hires. Usually it’s not recommended to compare “stocks” (job openings) and “flows” (hires). In this case, however, it has a meaning: A ratio of 1 means that it takes 1 month for a job opening to be filled; a higher ratio means it takes longer. It seems this ratio has never been above 1 except for now, which could be a sign that employers are finding it more difficult than any time since 2001 to hire people.

How this graph was created: Search for “job openings” and select the total non-farm series. Then select the edit graph feature: Use the “Edit line 1” tab to add a series by searching for “hires.” Finally, apply the formula a/b.

Suggested by Christian Zimmermann

View on FRED, series used in this post: JTSHIL, JTSJOL


There are many TEDs, but the TED in FRED is a spread. That is, the spread between the 3-month LIBOR and the 3-month Treasury bill.

A little background: LIBOR is the rate banks would charge each other for lending, which can be used to measure economy-wide credit risk. Treasuries are basically the safest assets on the market. So, a large TED spread would indicate a lot of credit risk in the U.S. economy.*

But how large is a typical TED spread? At the time of this writing, it looks like it’s about 30 to 40 basis points (0.3 to 0.4%), which is mid-range for recent years. It was up to 57 basis points in 2012 and below 20 on several occasions. A longer historical perspective shows that in times of crisis the TED spread really rises. Use the slider below the graph to change your sample period: The October 1987 stock market crash raised TED spreads close to 300 basis points, and the financial crisis of 2008 raised them to 450 basis points. Considering the whole sample, current conditions actually look pretty good.

*A side note: The TED spread is always going to be positive unless the risk on Treasuries increases much more than what current credit conditions warrant. This scenario could be caused by an increased risk of (partial) default by the U.S. government while credit conditions for U.S. banks remain unchanged. That’s unlikely to happen.

How this graph was created: Search for “TED spread” and you have your graph.

Suggested by Christian Zimmermann

View on FRED, series used in this post: TEDRATE

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