Economic Highlights: Growth & Profits Don Rissmiller August, - - PowerPoint PPT Presentation

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Economic Highlights: Growth & Profits Don Rissmiller August, - - PowerPoint PPT Presentation

Jan 27, 2023 121 likes •268 views

Economic Highlights: Growth & Profits Don Rissmiller August, 2013 Strategas Research Partners 212-906-0134 drissmiller@strategasrp.com Where Are We In the Business Cycle? U.S. Real Gross Domestic Product % Change - Year to Year SAAR

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SLIDE 1

Economic Highlights: Growth & Profits

Don Rissmiller August, 2013 Strategas Research Partners 212-906-0134 drissmiller@strategasrp.com

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SLIDE 2

Where Are We In the Business Cycle?

U.S. Real Gross Domestic Product

% Change - Year to Year SAAR , Bil.Chn.2009$ 10 05 00 95 90 85 80 75 70 65 60 Source: Bureau of Econom ic Analysis 10.0 7.5 5.0 2.5 0.0

  • 2.5
  • 5.0

10.0 7.5 5.0 2.5 0.0

  • 2.5
  • 5.0
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SLIDE 3

Where Are We In the Business Cycle?

U.S. Real Gross Domestic Product

% Change - Year to Year SAAR , Bil.Chn.2009$ 10 05 00 95 90 85 80 75 70 65 60 Source: Bureau of Econom ic Analysis 10.0 7.5 5.0 2.5 0.0

  • 2.5
  • 5.0

10.0 7.5 5.0 2.5 0.0

  • 2.5
  • 5.0
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SLIDE 4

Even in Bad Times, It’s Easy To Get a “Bounce”

Real Gross Domestic Product

% Change - Year to Year Bil.Chn.2009$ 39 38 37 36 35 34 33 32 31 30 Source: Bureau of Econom ic Analysis 15 10 5

  • 5
  • 10
  • 15

15 10 5

  • 5
  • 10
  • 15

1930s

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SLIDE 5

Pent-Up Demand Is Powerful

3 U.S. Areas To Watch: 1) Capex 2) Housing 3) State & Local Govt

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SLIDE 6

Pent-Up Demand Is Powerful

M frs' Shipments: Nondefense Capital Goods ex Aircraft

% Change - Year to Year SA, M il.$ 13 12 11 10 09 08 07 06 05 04 Source: Census Bureau 15.0 7.5 0.0

  • 7.5
  • 15.0
  • 22.5

15.0 7.5 0.0

  • 7.5
  • 15.0
  • 22.5
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SLIDE 7

Pent-Up Demand Is Powerful

M frs' Shipments: Nondefense Capital Goods ex Aircraft

% Change - Year to Year SA, M il.$

All Employees: Total Nonfarm

% Change - Year to Year SA, T hous 13 12 11 10 09 08 07 06 05 04 Sources: Census Bureau, Bureau of Labor Statistics 15.0 7.5 0.0

  • 7.5
  • 15.0
  • 22.5

4 2

  • 2
  • 4
  • 6
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SLIDE 8

Household Formation Is Key

Total Number of Households, Break-adjusted

% Change - Year to Year T hous 10 05 00 95 90 Source: Census Bureau/H av er Analytics 2.4 2.0 1.6 1.2 0.8 0.4 0.0 2.4 2.0 1.6 1.2 0.8 0.4 0.0

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SLIDE 9

Economic Symmetry

2012 Muddle Through (Deleveraging) Late-2012, early 2013 Slowdown (Fiscal Cliff / Sequester Uncertainty) 2013-14 Recovery (We get housing & capex back) 2011 Muddle Through (Deleveraging) 2009-2010 Moderate Recovery (Missing housing) 2007-2009 Deep Recession

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SLIDE 10

But U.S. Inflation Is Not a Problem, With Wage Growth Restrained

CPI-U: All Items

% Change - Year to Year SA, 1982-84=100

Nonfarm Business Sector: Compensation Per Hour

% Change - Year to Year SA, 2009=100 10 05 00 95 90 85 80 75 70 65 60 Source: Bureau of Labor Statistics 16 12 8 4

  • 4

16 12 8 4

  • 4
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SLIDE 11

So What Is the Fed Doing With Tapering?

Civilian Unemployment Rate: 16 yr +

SA, % 10 05 00 95 90 85 80 75 70 65 60 Source: Bureau of Labor Statistics 12 10 8 6 4 2 12 10 8 6 4 2

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SLIDE 12

Labor Share At a Low

U.S. Corporate Compensation % Corporate GDP

10 05 00 95 90 85 80 75 70 65 60 55 50 Source: H av er Analytics 66 64 62 60 58 56 66 64 62 60 58 56

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SLIDE 13

Future Productivity Gains Will Be Important

Nonfarm Business Sector: Real Output Per Hour of All Persons

% Change - Year to Year SA, 2009=100 10 05 00 95 90 85 80 75 70 65 60 Source: Bureau of Labor Statistics 6 4 2

  • 2

6 4 2

  • 2