ted c. jones chief economisttran/2019/ted_jon… · employment supersector nov 2018 today 5-years...
TRANSCRIPT
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Ted C. Jones, PhD Chief Economist
Ted C. Jones Chief Economist
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The First People Not to Read the Apple Terms
& Conditions Prior To Clicking Accept Were Adam & Eve
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When Getting On An Airplane, the Person On the Aisle Always
Gets There First
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Things Change
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Jobs are Everything Period
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125
130
135
140
145
150
'07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18
U.S. Jobs Jobs (Millions) Seasonally Adjusted
1.79% Prior 12 Months 2.64 Million Net New Jobs in Past 12-Months
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U.S. Net Job Gains – Trailing 12-Months
0
1
2
3
4
'11 '12 '13 '14 '15 '16 '17 '18 '19
Jobs - Millions
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U.S. Leisure & Hospitality Jobs
0
'07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19
12.5
13.0
13.5
14.0
14.5
15.0
15.5
16.0
16.5
Recession
Millions of Jobs Seasonally-Adjusted
+1.89% Past 12 Months
The Blood Pressure Test of the U.S. Economy
Hurricanes Harvey & Irma
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3.2% 3.9% 12-Month Income Increase
Largest Since 2009
Unemployment Rate
48-Year Low (was 3.7% last month 49 Yrs)
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$20
$22
$24
$26
$28
'07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19
U.S. Average Hourly Earnings $US Per Hour
Up 3.2 Percent in Past 12-Months To $27.48 Per Hour
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90% $80 Billion Pay Less
Taxes
Extra Money Spent on Real Estate Annually
Due to Tax Cuts
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Taxes – or Lack There of – Influences Where People Live & Businesses Relocate
Taxes Matter
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U.S. Existing Home Sales & Median Prices Sales Trailing 12 Months
$180
$200
$220
$240
$260
$280
'14 '15 '16 '17 '18
4.8
5.0
5.2
5.4
5.6
Median Price Homes Sales
Median Price $ Thousands Home Sales 12-Months Millions
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175
200
225
250
275
300
325
'07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18
U.S. Average Existing Home Price $ Thousands – Not Seasonally Adjusted
All-Time Record June 2018
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13.6% Percent of
U.S.
Population
Aged 25-34
36% Percent of
Homes
Purchased
Past 12-Months
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700
800
900
1,000
1,100
'07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18
Austin-Round Rock MSA Jobs Jobs (Thousands) Seasonally Adjusted
3.39 Percent Prior 12 Months 35,400 Net New Jobs in Past 12-Months
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Total Net Net
Jobs New New
Thousands Jobs Percent Jobs Percent
Employment Supersector Nov 2018 Today 5-Years Ago Thousands Change Thousands Change
Total 1,088.0 100.00% 100.00% 35.20 3.34% 179.90 19.8%
Mining, Logging and Construction 67.2 6.31% 5.20% 6.10 9.98% 20.00 42.4%
Manufacturing 58.0 5.45% 6.39% 0.20 0.35% - 0.0%
Trade-Transport-Utilities 194.1 18.24% 17.53% 11.60 6.36% 34.90 21.9%
Information 31.2 2.93% 2.71% 0.50 1.63% 6.60 26.8%
Financial Activites 61.6 5.79% 5.55% 0.60 0.98% 11.20 22.2%
Professional and Business Service 188.6 17.72% 15.98% 4.50 2.44% 43.50 30.0%
Education and Health Services 124.8 11.73% 11.55% 3.40 2.80% 19.90 19.0%
Leisure & Hospitality 133.6 12.55% 11.28% 4.20 3.25% 31.20 30.5%
Other 47.4 4.45% 4.54% 2.10 4.64% 6.20 15.0%
Government 181.5 17.05% 19.28% 2.00 1.11% 6.40 3.7%
Source: U.S. Bureau of Labor Statistics, Stewart Title Guaranty Company
All Jobs
12-Months 5 Years
Austin-Round Rock MSA Supersector Job Growth Analysis -- November 2018Not Seasonally Adjusted
Percent of
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When You Get a Raise You Are Simply
Broke at a Higher Level
Dr Ivan Schmedemann, Professor Emeritus
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Millennials Are the Future
and the Present
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Austin-Round Rock MSA Home Sales & Median Prices Sales Trailing 12 Months
$200
$220
$240
$260
$280
$300
$320
'14 '15 '16 '17 '18 '19
29,000
30,000
31,000
32,000
33,000
34,000
35,000
Average Price Homes Sales
Median Price $ Thousands Home Sales 12-Months
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Austin MSA Home Sales
0
1,000
2,000
3,000
4,000
'02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18
Number Per Month
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4.6%
12-Month
Moving
Average
Of Median
Price
Increase
Y-O-Y
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Austin-Round Rock MSA Residential Building Permits
0
5,000
10,000
15,000
20,000
25,000
30,000
'99
'00
'01
'02
'03
'04
'05
'06
'07
'08
'09
'10
'11
'12
'13
'14
'15
'16
'17
'18
Single Family Multi
Number of Dwelling Units
29,105 Permits is the Past 12 Months, Net 35,400 New Jobs
2018 is Latest 12 Months
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Net Dwelling Jobs
New Unit Per New
Year Jobs Permits Dwelling
2013 38,300 20,865 1.84
2014 38,600 20,276 1.90
2015 41,400 22,370 1.85
2016 34,600 21,861 1.58
2017 32,600 26,700 1.22
Total 185,500 112,072 1.66
Austin-Round Rock MSA
Jobs & Residential Dwelling Unit Permits1.25 to
1.50 Net New Jobs Per
New Dwelling
Unit Is
Normal
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No Where is It Written That Home Values Will Always
Go Up
The Same Goes for Rent Also
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There are Three Kinds of People
That Can Buy a Home Without a Job
People with Gray Hair, Blue Hair or No Hair: Retirees
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$150
$160
$170
$180
$190
$200
$210
'02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18
U.S. Real Retail & Food Service Sales $ Billions – Seasonally Adjusted
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0
2
4
6
8
10
12
'00
'01
'02
'03
'04
'05
'06
'07
'08
'09
'10
'11
'12
'13
'14
'15
'16
'17
'18
E-Commerce Sales Percent of Total Sales – Not Seasonally Adjusted
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om·ni·chan·nel /ˈämnəˌCHanl/ adjective adjective: omnichannel; adjective: omni-channel denoting or relating to a type of retail that integrates the different methods of shopping available to consumers (e.g., online, in a physical store, or by phone). "80 percent of sales for omnichannel retailers happen in the offline world"
Omnichannel Marketing
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Omnichannel Marketing
• The number of people who shopped both online and in-store Cyber Monday was up nearly 40% over 2017
• Multichannel shoppers outspent single-channel shoppers by up to $93 on average
• 49% of all e-commerce traffic came from smartphones
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0
4
8
12
16
20
'04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18
Light Weight Vehicle Sales Millions – Seasonally Adjusted Annual Rate
Bureau of Economic Analysis
Cash For Clunkers
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Household Debt Service as a Percent of Household Disposable Income
9
10
11
12
13
14
'82
'84
'86
'88
'90
'92
'94
'96
'98
'00
'02
'04
'06
'08
'10
'12
'14
'16
Percent
FED Board of Governors, BEA
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Fed Funds Rate Up 25 bp
to 1.75% to 2.0%
Percent June 13, 2018
$2.2 Billion More Per
Year in Just Credit Card
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Basis
Months Number Points
Duration Increases Increase
June 2004 - June 2006 25 17 425
June 1999 - May 2000 12 6 175
March 1997 1 1 25
February 1994 - Feb 1995 13 7 300
Average 231.25
Median 237.5
Source: Federal Reserve Bank of New York
Fed Funds Target Rate Increases
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10-Year Treasury 2.19%
30-Year Residential 3.94%
Lower Quartile 115.6
1/3rd 173.4
Median Quartile 231.3
November 2015
Rate Increase Impact - Basis Points
Rate Moves Over Cycle
Lower Quartile 3.35%
1/3rd 3.92%
Median Quartile 4.50%
Lower Quartile 5.10%
1/3rd 5.67%
Median Quartile 6.25%
30-Year Residential Rates 9-15 Months
Treasury Forecasts 9-15 Months
Forecast For June 2019
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4.8% Fannie Mae 5.1% Freddie Mac 5.1% MBA 5.1% - 5.7% Ted
30-Year Conventional Mortgage Rate Forecast
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$0
$100
$200
$300
$400
$500
$600
'02
'03
'04
'05
'06
'07
'08
'09
'10
'11
'12
'13
'14
'15
'16
'17
'18
U.S. Commercial Real Estate Sales Volume
$ Billions – Trailing 12 Months
Property and Portfolio Sales $2.5 Million and Up
+6.1 Percent Year-Over-Year
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$0.0
$2.0
$4.0
$6.0
$8.0
$10.0
'02
'03
'04
'05
'06
'07
'08
'09
'10
'11
'12
'13
'14
'15
'16
'17
'18
Austin Commercial Real Estate Sales Volume
$ Billions – Trailing 12 Months
Property and Portfolio Sales $2.5 Million and Up
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There is No Such Thing as a National Real Estate Market
(Or Economy)
TINSTAANREM Axiom -- Ted C Jones
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5%
6%
7%
8%
9%
10%
'02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18
US Cleveland Austin South Carolina
Commercial Real Estate Cap Rates
Percent – 12-Month Moving Average
Property and Portfolio Sales $2.5 Million and Up
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Dr Glenn Mueller
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Dr Glenn Mueller
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Dr Glenn Mueller
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Dr Glenn Mueller
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Dr Glenn Mueller
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Dr Glenn Mueller
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Federal Debt – Total Public Debt
0
4
8
12
16
20
24
'80
'82
'84
'86
'88
'90
'92
'94
'96
'98
'00
'02
'04
'06
'08
'10
'12
'14
'16
$ Trillions
St Louis Federal reserve
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Federal Debt Interest Payments
+30% March 2017 Vs 2016 +10.7% March 2018 Vs 2017
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Latin for “It’s Going to Cost More.”
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U.S. & China Trade
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
'07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17
$ Millions
US Purchases From China
China Purchases From US
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What the U.S. Bought from China in 2017
$ Billions
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What the China Bought from U.S. in 2017
$ Billions
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“It’s not a currency. It does not meet the test
of a currency. I wouldn’t be surprised if it’s not around in 10
or 20 years. Stay away from it – it’s a
mirage.”
Warren Buffett on Cryptocurrencies
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$4,758 Electricity Cost to Mine 1 Bitcoin
In U.S.
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Bitcoin Terra Watt Hours
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1012
Terra Watt
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1st Time in 75 Years U.S. is a Net Oil
Exporter
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0
500
1,000
1,500
2,000
2,500
4-Ja
n-02
6-D
ec-0
2
7-N
ov-0
3
8-O
ct-0
4
9-S
ep-0
5
11-A
ug-0
6
13-J
ul-0
7
13-J
un-0
8
15-M
ay-0
9
16-A
pr-1
0
18-M
ar-1
1
17-F
eb-1
2
18-J
an-1
3
20-D
ec-1
3
21-N
ov-1
4
23-O
ct-1
5
23-S
ep-1
6
25-A
ug-1
7
27-J
ul-1
8
North American Drilling Rig Counts Number of Operating Rigs
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Oil $60s 2018
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DrTCJ
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Strong Economy Lagging Home Construction Growing Jobs & Wages Rising Interest Rates Rising Home Prices (Albeit at a Lower Pace) Cheap Energy
2019 Economic Outlook
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Paper Straw Manufacturer
In the U.S.
We use 500 Million Straws Daily
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Ted C. Jones, PhD Chief Economist
Ted C. Jones Chief Economist