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This is definitely the most impressive "sure thing" failure yet. 0.9997! Sis boom bah!
Sis boom bah.
Describe the sound made when a sheep explodes.
Describe the sound made when a sheep explodes.
January 12, 2014
Toyota Sees Auto Industry Growth Slowing in 2014
Continued sales growth will be more a result of economic gains rather than pent-up demand, he said. “That’s good, because pent-up demand can carry you just so far.”
You think?
Source Data:
St. Louis Fed: Custom Chart
14 comments:
I really like Doug Short's charts on this topic. Total miles driven hit a brick wall despite population and fuel economy increases.
dshort's wrong about this:
"There are profound behavioral issues apart from gasoline prices that are influencing miles driven"
My first reaction was to add gas prices too:
http://research.stlouisfed.org/fred2/graph/?g=srf
and the correlation I see is that gas over $2 is killing consumption, er, strongly encouraging consumers to economize their mileage.
$4 pump prices is something that hits everybody, unemployment and distance working is still marginal in comparison.
Though it is true that the age 65+ demo should be removed from the population to get a better per-capita picture.
Tho it is possible that touch phones, networked console gaming, and social media is reducing Gen Y's driving demand significantly I guess.
Gen Y is age ~12 to ~30 now.
For what it is worth, I believe that my chart clearly shows that the #1 factor in reduced miles traveled is...
The Great Recession
That's when the "sure thing" trend failed. It wasn't slowly degrading up to that point (as demographics or rising gasoline prices would do). It failed all at once. It isn't recovering because the economy isn't recovering (much).
That said, now there are all sorts of straws being added to the camel's back. I do think the younger generation will be driving less, perhaps not entirely out of economic necessity (but that is certainly a factor thanks to rising college costs).
This long-term trend is dead. Stick a fork in it. I'd be surprised if the typical American is driving even 7,000+ miles per year in 50 years. Generally spekaing, driving is such a waste of resources.
Thing is, we transitioned from the $1-2 regime to the $3-4 regime just prior to the recession.
http://research.stlouisfed.org/fred2/series/GASREGCOVWCW
or, gallons you can buy with an hour of wages:
http://research.stlouisfed.org/fred2/graph/?g=srK
overlaying miles again:
http://research.stlouisfed.org/fred2/graph/?g=srM
People still remember when you could fill up for a $20 not too long ago.
Troy,
If you want to argue that $4 gasoline helped trigger the recession, then I would certainly not disagree!
$4 was neither here nor there compared to
http://research.stlouisfed.org/fred2/graph/?g=srP
monthly CMDEBT change
$100B/mo flow going away is going to put a lot of frowns on faces.
http://research.stlouisfed.org/fred2/graph/?g=srR
monthly consumer credit draw, per-capita, divided by average hourly wage.
30 hrs of month of wages flowing into the paycheck economy, without any work being done.
Nobody gets this. (Krugman missed the opportunity to make the point in a blog post today)
This detrending is nearly a quarter century old. Early 1990s. Most of the factrs were considered. One big hatchet was the usurious insurance rates keeping new drivers off the roads.
I bet the plot of growth in miles traveled would match up well with a plot of the growth in disposable incomes of the bottom 90-95%.
I know FRED has the overall income data , but I don't think they have it broken down by deciles , etc. They do have the gini index , but I'm not sure how you would transform the income data using that.
Anonymous,
I bet the plot of growth in miles traveled would match up well with a plot of the growth in disposable incomes of the bottom 90-95%.
Would you settle for the middle of the pack?
Real Median Household Income (in black) vs. Vehicle Miles Traveled per Capita (in blue)
^ stunning graph
1990s prosperity, gone.
but we still have the bag
http://research.stlouisfed.org/fred2/graph/?g=stw
real per-capita non-fi debt
Troy,
The bag is ours to keep as a "condolences" prize, lol. Sigh.
Just more gallows humor.
Yep , median income seems to tell the story pretty well. Thanks
I'll take "all of the above".
In addition to distance working, I'd add the rise of online shopping -- less driving to stores.
And there's also the idea that the S-curve of innovation in motor vehicle related technology has finally flattened out, or at least temporarily plateaued. After the "Drive 55" period in the 1980s, highway speed limits were increased substantially, so folks could travel further without spending any more time doing so. But lately, average road speeds haven't increased, so people can't drive more without spending more time on the road. Time is the scarcest resource of all, and if the productivity of "driving time" isn't increasing, folks will do less of it.
I could see vehicle miles increasing again when robotic driving technology becomes the standard. At that point higher speeds become possible, and in addition folks in the vehicles could be doing something other than watching the road, so productivity of that time increases.
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