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This is an update to a chart I did last fall. For a description of what it means please refer to Close Encounters of the Fear Kind.
I'm not sure what will happen next. The yield on the three month treasury bill is pathetic (less than 1.5%). It can't really go all that much lower.
It is probably time to stick a fork in this chart and begin staring more at the unemployment chart instead.
I'm thinking the trend isn't our friend. Does that look like we're in the eighth inning to you? Here's a look at previous games.
Consumers’ reduced spending habits affect retail, restaurant industries
But don’t blame all the closings on the downturn, retail experts say. After years of economic expansion and a consumer boom fed in part by growing household debt, America is simply overstored.
About 25,000 specialty stores have opened since 2000, and restaurant offerings now exceed demand, according to Technomic, a Chicago-based industry consultant.
Changing consumer trends also have led to closings.
Income earned by women who were joining the workforce drove sales for several decades. But that trend has leveled off, which may be more of a long-term issue for the industry than the current economic situation, said Bonnie Riggs, author of the new NPD report, “Why This Downturn Will Be Different for Restaurants.”
Here's a summary of the report.
The NPD Group Reports on Why This Economic Downturn Will Be Different for Restaurants
While each recessionary period had its own unique characteristics, NPD found that current conditions are most similar to those experienced in 1979 and 1980 when the industry experienced it steepest traffic losses.
Well, knock me over with a feather.
See Also:
Fear Minus Greed
Close Encounters of the Fear Kind
Source Data:
FRB: Selected Interest Rates
St. Louis Fed: The Employment Situation
4 comments:
StagMark,
There is another interesting spread I posted on awhile back, the spread between the CIVPART series, which is the labor participation rate, and the EMRATIO series, which is the employed as a percent of the population. Take a look if you haven't yet, not sure how to interpret it or if it is even telling us anything lol!
energyecon,
I looked at the data. I'm not sure what it is trying to tell us either, lol.
However, the EMRATIO chart seems to be trying to say something though.
http://research.stlouisfed.org/fred2/series/EMRATIO
Let's call any trend up on the chart something wonderful, just for the sake of argument.
1. The big picture/trend says something wonderful happened between 1982 and 2000.
2. The big picture/trend says something wonderful peaked in 2000 and seems to be going away. The long-term upward trend appears to be very questionable at best these days.
3. The small picture(s)/trend(s) say something wonderful also goes away during bad times (every single recession).
So what is this something wonderful again? Oh yeah, it represents more people working. I guess the economy prefers that. Go figure. ;)
StagMark,
Not sure about the demographic data, but could that be the peak of the secular trend of women entering the work force...and were any changes made to how peeps were counted?
energyecon,
I figure if the transition from 1 out of 2 in the household working to 2 out of 2 in the household working worked out so well then all we need to do is find a way to get 3 out of 2 in the household working.
Stretched to Limit, Women Stall March to Work
http://www.nytimes.com/2006/03/02/business/02work.html
This is having broad repercussions for the economy. Today, about 75 percent of women 25 to 54 years old are either working or actively seeking a job, up from around 40 percent in the late 1950's. That expansion helped fuel economic growth for decades.
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