A mediocre economic recovery

While metrics such as Gross Domestic Product (GDP) are useful in understanding economic performance, it is only a single measurement (with well known flaws) and must be augmented to more properly understand the state of the economy.

I’ve posted about the Chicago Fed National Activity Index (CFNAI) in the past; this is broad [...]

A picture says it all

Sometimes its difficult to appreciate the sheer scope and intensity of The Great Recession and the depth of the hole the US economy has to crawl out of. The chart above shows real Gross Domestic Product (aka, “GDP”, GDPC1, black line) from October 2007 to the present. Further, I’ve baseline the series to 100 [...]

Spooked consumers are saving …

The growth in job creation has all but flatlined, while the expanding labour force has pushed unemployment rate up and fully 80% of Americans have directly experienced unemployment or known someone who has been unemployed during The Great Recession, and the canaries in the coal mind are sending signals we’d best not ignore.

[...]

Easy money forever?

The Adjusted National Financial Conditions Index (ANFCI) is a little known but very fascinating metric. Created and maintained by The Federal Reserve Bank of Chicago, the ANFCI is calculated as a weighted average of 100 different variables measuring the financial markets (complete list is here). Each variable is expressed a function of their sample [...]

Goverment stewardship of US taxes

I’ve been looking at a lot of Bureau of Economic Analysis (BEA) data for a client lately, and for my own purposes started looking at longer term trends regarding what the US government gets up to with our money. Here is an interesting one: the chart above shows the ratio of what’s called Federal [...]

Investment is falling, GDP will follow

I found an interesting dataset recently, Gross Private Domestic Private Investment. Tabulated by The Bureau of Economic Analysis (BEA), this metric tracks total investments made by private business in The United States. While their full methodology is explained here [ .pdf ], the chart above compares Gross Private Domestic Private Investment (GDPI, black line) [...]

Our lenders might be nervous

The chart above shows Total Credit Market Debt Owed (TCMDO, black line) compared to GDP (GDP, blue line). Total Credit Market Debt Owed, created and tracked by The Federal Reserve, measures the total amount of credit in the system.

Debt allows us to pull consumption from the future to the present. In other [...]

Socialist America

The American government likes to proudly wave the flag of capitalism whenever it suits, and look the other way when such claims are inconvenient. Proof? There is nothing capitalist about a government specified minimum wage nor bailouts of disparate industries such as automobile manufacturing or banking.

The chart above shows US Government spending [...]

An economy in reverse …

New orders for durable goods are excellent indicators to consider when trying to forecast economic activity in America. The metric durable goods refers to tangible things that must be made; from relatively small items like refrigerators to large bulldozers or jet aircraft, this is an important indicator to track since the employment related to [...]

A peculiar type of stagflation

In the 1970s we all learned a new word stagflation – relatively high unemployment accompanied by relatively low economic growth. The chart above presents two periods with the same series: unemployment (UNRATE, black line, quarterly, in percent), the Consumer Price Index, or CPI (CPIAUCSL, red line, quarterly, percent change from one year ago), the [...]