I live in the USA and I am concerned about the future. I created this blog to share my thoughts on the economy and anything else that might catch my attention.
Monday, March 3, 2014
Here We Go Again
The following chart shows real personal consumption expenditures growth per capita (excluding food and energy).
Click to enlarge.
If you have your party hat on, then you better hope that the trend reverses soon.
$200/mo lease on a Leaf makes killer sense for most people.
I'm working under the theory that if everyone else buys an electric car then I won't need to do the same! :)
I'm only half joking of course. I am definitely not in the group that should buy an electric car. I don't drive enough to justify the expense. My '96 Camry has less than 90k miles on it and a good 40k of those miles were done the first 4 years. Lately, I've been driving about 2k miles per year, give or take.
In 2009, a Chinese manufacturer, Sichuan Tengzhong Heavy Industrial Machinery Company, announced that it would acquire Hummer, pending government approvals, but later withdrew its bid. On February 24, 2010, Reuters reported that the Chinese ministry of commerce had prevented the deal, although a ministry spokesperson denied rejecting the application, which had been stalled for eight months. At the end of February, General Motors announced it would begin dismantling the Hummer brand.
The broader version goes back to '59, and seems to work just as well. Getting rid of the /cap denominator doesn't change the picture either.
ReplyDeleteMost recessions are led by a decrease.
Also notice how different the graph looks pre- and post 1980. Recovery tops get more and more anemic.
http://research.stlouisfed.org/fred2/graph/?g=sFM
JzB
If the Fed wanted to be anti-incumbent, it could 'taper' into 2016, like it unwound rate stimulus in 1995-96:
ReplyDeletehttp://research.stlouisfed.org/fred2/graph/?g=sFQ
and again in 2000.
Under B it politely held off aggressive QE coming into the election:
http://research.stlouisfed.org/fred2/graph/?g=sFS
dunno if Yellen, the first non-conservative Fed chair that I'm aware of, has the institutional power to change this pattern.
The Fed may not be all-powerful, but I wouldn't want to go toe-to-toe with it.
The core imbalance in the economy is that the rich have too much capital and the poor do not.
This is more Congress' task to fix, but the Fed has some input here, too.
Or at least some tools they can use, should they decide to go with the game.
The USD isn't going to weaken itself!
Jazzbumpa,
ReplyDeleteIn my opinion, your version makes things currently look better than they actually are.
Food and energy aren't going to help our shopping malls much. Sigh.
Troy,
ReplyDeleteThe core imbalance in the economy is that the rich have too much capital and the poor do not.
I sure as heck wouldn't count on the Fed to fix that. I think it can be easily argued that they make it worse.
The richest can make money as the price of oil rises. The poorest are shafted by it.
The richest can make money as the price of oil rises. The poorest are shafted by it.
ReplyDeletenah, they just drive less.
Can't get blood from a stone.
That miles trend, ya know.
Troy,
ReplyDeletenah, they just drive less.
And at some point, they can no longer afford to drive to their "new and improved" part-time job.
Shafted.
The system learned in 2008 that you can park only so much oil in tankers before it must be delivered to the refineries.
ReplyDeleteWhat with natgas, EV, etc., oil isn't the only game in town any more.
$200/mo lease on a Leaf makes killer sense for most people.
Troy,
ReplyDelete$200/mo lease on a Leaf makes killer sense for most people.
I'm working under the theory that if everyone else buys an electric car then I won't need to do the same! :)
I'm only half joking of course. I am definitely not in the group that should buy an electric car. I don't drive enough to justify the expense. My '96 Camry has less than 90k miles on it and a good 40k of those miles were done the first 4 years. Lately, I've been driving about 2k miles per year, give or take.
In my opinion, your version makes things currently look better than they actually are.
ReplyDeleteI wanted more history, was looking at the bigger picture, and didn't notice that.
Yours is less volatile the last three years, and that makes the current downward slope easier to see. Also, mine tends to run a bit higher, but the early 2012 dip is making the trace since then look relatively flatish.
The next year or two should be interesting, in a Chinese curse kind of way.
JzB
Jazzbumpa,
ReplyDeleteThe next year or two should be interesting, in a Chinese curse kind of way.
I hope they are boring years, but I am bracing for the "cursed." Sigh.
I remember when people drove Hummers and Excursions. Now, Ford is rolling out an aluminum body F-150, and it's always truck month.
ReplyDeleteLuke the Debtor,
ReplyDeleteHummer
In 2009, a Chinese manufacturer, Sichuan Tengzhong Heavy Industrial Machinery Company, announced that it would acquire Hummer, pending government approvals, but later withdrew its bid. On February 24, 2010, Reuters reported that the Chinese ministry of commerce had prevented the deal, although a ministry spokesperson denied rejecting the application, which had been stalled for eight months. At the end of February, General Motors announced it would begin dismantling the Hummer brand.
Go figure.