united states -5 · job market showing modest improvement non-farm employment, united states ......
TRANSCRIPT
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Real gross domestic productUnited States
Sources: Bureau of Economic Analysis, IHS Global Insight.
11090705030199979593918987858381
10
5
0
-5
-10
Compound annual growth rate
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Consumer spending picks upReal personal consumption expenditures
Sources: Bureau of Economic Analysis, IHS Global Insight.
20112010200920082007200620052004200320022001
4
3
2
1
0
-1
-2
-3
Percent change, year ago
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Job declines in postwar recessions
By year of employment peak
Sources: Bureau of Labor Statistics, IHS Global Insight.
20082001199019811980197319701960195719531948
0.0
-1.0
-2.0
-3.0
-4.0
-5.0
-6.0
-7.0
Percent change from peak to trough
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1110090807060504030201
4.0
2.0
0.0
-2.0
-4.0
-6.0
600
400
200
0
-200
-400
-600
-800
-1000
Percent change, year ago Difference from previous month
Job market showing modest improvementNon-farm employment, United States
Sources: Bureau of Labor Statistics, IHS Global Insight.
Absolute change,
ths. (R)
% change (L)
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Unemployment rate falls slightly Civilian unemployment rate
Sources: Bureau of Labor Statistics, IHS Global Insight.
11060196918681
11
10
9
8
7
6
5
4
3
Percent
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20112010200920082007200620052004200320022001
30
20
10
0
-10
-20
-30
-40
-50
Compound annual growth rate
Business investment fuels recovery Fixed nonresidential private domestic investment
Sources: Bureau of Economic Analysis, IHS Global Insight.
Equip. and
software
Structures
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20112010200920082007200620052004200320022001
60
40
20
0
-20
-40
-60
Percent change, year ago
Median single-family home salesUnited States
Sources: National Association of Realtors, Moody’s Analytics.
Existing
homes
New
homes
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20112010200920082007200620052004200320022001
30
20
10
0
-10
-20
-30
-40
Percent change, year ago
U.S. international trade Exports vs. Imports (goods and services)
Sources: U.S. Census, IHS Global Insight.
Exports
Imports
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S&P 500 composite Price index
Sources: S&P, IHS Global Insight.
20112010200920082007200620052004200320022001
1600
1400
1200
1000
800
600
S&P 500 Index
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Unemployed waiting longer for work
Percent of the unemployed who are out of work for 27 weeks or more
Sources: Bureau of Labor Statistics, Moody’s Analytics.
20112010200920082007200620052004200320022001
50
40
30
20
10
0
Percent
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20112010200920082007
700
600
500
400
300
200
7
6
5
4
3
2
Thousands Millions
Claims fall as hiring picks up
Average weekly unemployment insurance claims
Sources: Bureau of Labor Statistics, Moody’s Analytics.
Initial UI
claims (L)
Continuing UI
claims (R)
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Labor force participation rate
United States
Sources: Bureau of Labor Statistics, Moody’s Analytics.
1008060402009896949290
67.5
67.0
66.5
66.0
65.5
65.0
64.5
64.0
Percent
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20102009200820072006200520042003200220012000
9.0
8.5
8.0
7.5
7.0
6.5
6.0
5.5
Millions
2010 Q2 marked first positive net employment
change since start of recent recession
Sources: Bureau of Labor Statistics, Moody’s Analytics.
Gross job gains
Gross job losses
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Sources: Federal Reserve, Senior Loan Officer Opinion Survey, Moody’s Analytics.
Small businesses facing tight underwriting
Net percent of lenders tightening C&I loans to small businesses
1008060402009896949290
80
60
40
20
0
-20
-40
Percent
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Sources: National Federation of Independent Business, Moody’s Analytics.
Small businesses mood still gloomy
Small Business Optimism Index
1008060402009896949290
120
115
110
105
100
95
90
85
Index
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Sources: National Federation of Independent Business, Moody’s Analytics.
Lack of credit hurting small businesses
Small Business Optimism Index
Net percent of firms reporting
credit is harder to get
Net percent of firms planning to
add inventory
1008060402009896949290
20
15
10
5
0
-5
-10
-15
Percent
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Households deleveraging
Total consumer credit as percent of disposable income
Sources: Federal Reserve Board, Moody’s Analytics.
10050095908580
26
24
22
20
18
16
14
Percent
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1008060402009896949290
12.0
10.0
8.0
6.0
4.0
Percent
Households shedding debt
Financial obligations ratio – Homeowner’s debt as percent of disp. income
Sources: Federal Reserve Board, Moody’s Analytics.
Consumer
debt
Mortgage
debt
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Consumers purchase more without credit
Non-auto retail sales vs. revolving installment credit
Sources: Federal Reserve Board, Moody’s Analytics, U.S. Census Bureau.
2011201020092008200720062005
10
5
0
-5
-10
-15
Percent change, year ago
Non-auto
sales
Revolving credit
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Consumer Sentiment IndexUniversity of Michigan
Sources: Federal Reserve Bank of St. Louis, University of Michigan, Moody’s Analytics.
1008060402009896949290
120
110
100
90
80
70
60
50
Index 1966Q1= 100
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Auto sales improving but slowlyLight vehicle sales
Sources: Bureau of Economic Analysis, IHS Global Insight.
2011201020092008200720062005
22
20
18
16
14
12
10
8
Millions, SAAR
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Middle East turmoil causes oil prices to riseWest Texas Intermediate Crude
Sources: Wall Street Journal, IHS Global Insight.
20112010200920082007200620052004200320022001
160
140
120
100
80
60
40
20
0
Dollars per barrel
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Oil consumption (average per day) per unit of GDP
United States
Sources: Energy Information Administration, Bureau of Economic Analysis, Milken Institute.
100806040200989694929088868482807876
3.5
3.0
2.5
2.0
1.5
1.0
Barrels per $1 Million of real GDP
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2010200019901980197019601950
140
120
100
80
60
40
20
0
10
8
6
4
2
0
-2
-4
-6
$ per Bbl (in real terms) Percent
Real oil prices vs. real Fed Funds rateUnited States
Sources: Federal Reserve Bank of St. Louis, U.S. Census Bureau, Moody’s Analytics.
Fed Funds
rate (R)
Oil Price: Domestic
West Texas Intermediate
(L)
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Impact of $10 increase in oil prices Over next four quarters, United States
Source: Milken Institute.
Category
Percent
change
Real gross private residential investment -1.4
Consumer spending on all goods and services -0.4
Real gross private fixed nonresidential investment -0.2
Exports -0.3
Total non-farm -0.1
Civilian unemployment rate (DIFF) 0.1
Real gross domestic product -0.2
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20102009200820072006200520042003200220012000
7
6
5
4
3
2
1
0
Percent
Interest ratesFed funds rate vs. 10-year bond yield
Sources: Federal Reserve Board, IHS Global Insight.
Federal
funds rate
10-year T-
note yield
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Federal Reserve balance sheetUnited States
Sources: Federal Reserve, Moody’s Analytics.
20112010200920082007200620052004200320022001
3.0
2.5
2.0
1.5
1.0
0.5
0.0
US$ trillions
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1110090807060504030201
6.0
4.0
2.0
0.0
-2.0
-4.0
Percent change, year ago
Headline CPI inflation gaining momentumOverall vs. core Consumer Price Index
Sources: Bureau of Labor Statistics, IHS Global Insight.
Overall
Less
food and
energy
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20112010200920082007200620052004200320022001
5
4
3
2
1
0
Percent change, year ago
Decline in consumer inflation rate indicative of excess capacity in labor market
Sources: Bureau of Labor Statistics, IHS Global Insight.
Average hourly
earnings
Core CPI
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Unit labor costsUnited States
Sources: Bureau of Labor Statistics, IHS Global Insight.
20102009200820072006200520042003200220012000
6
4
2
0
-2
-4
Percent change, year ago
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Productivity growthOutput per hour among non-farm businesses
Sources: Bureau of Labor Statistics, Moody’s Analytics.
20102009200820072006200520042003
7
6
5
4
3
2
1
0
-1
Percent change, year ago
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Non-defense capital spending (excl. aircraft)Value of new orders
Sources: U.S. Census Bureau, IHS Global Insight.
20112010200920082007200620052004200320022001
30
20
10
0
-10
-20
-30
-40
Percent change, year ago
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Purchasing manager’s index indicates expansionISM diffusion indices
Sources: Institute for Supply Management, IHS Global Insight.
Manufacturing
Non-
Manufacturing
2011201020092008200720062005
65
60
55
50
45
40
35
30
Index
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Corporate profits
Profits before tax (without IVA and CCadj.)
Sources: Federal Reserve Board, IHS Global Insight.
2010200920082007200620052004200320022001
80
60
40
20
0
-20
-40
-60
Percent change, year ago
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20112010200920082007200620052004200320022001
40
20
0
-20
-40
Percent change, year ago
Exports to BRICs, Japan and EU
Merchandise exports
BRICs
EU
Sources: U.S. Census, IHS Global Insight.
Japan
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20112010200920082007200620052004200320022001
60
40
20
0
-20
-40
Percent change, year ago
Exports to newly industrialized countries and China
Merchandise exports
China
Newly industrialized
countries
Sources: U.S. Census, IHS Global Insight.
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20112010200920082007200620052004200320022001
40
20
0
-20
-40
Percent change, year ago
Exports to NAFTA Merchandise exports
Sources: U.S. Census, IHS Global Insight.
Mexico
Canada
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Weighted average exchange value of U.S. DollarMajor Currencies Index, In real terms
Sources: U.S. Board of Governors of the Federal Reserve System, Moody’s Analytics.
20112010200920082007200620052004200320022001
120
110
100
90
80
70
Index (March 1973=100)
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201120102009200820072006200520042003
30
20
10
0
-10
-20
-30
-40
Percent change, year ago
Construction put-in-placeUnited States
Sources: U.S. Census, Moody’s Analytics.
Residential
Non-
residential
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20112010200920082007200620052004200320022001
8.0
7.5
7.0
6.5
6.0
5.5
5.0
4.5
4.0
Percent
30-year fixed mortgage rateUnited States
Sources: Mortgage Bankers Association, Moody’s Analytics.
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201120102009200820072006200520042003200220012000
240
220
200
180
160
140
120
100
80
Index Jan. 2000=100, 3 month ending
S&P/Case Shiller indexHome price index
Sources: Standard & Poor's and Fiserv, Inc., Moody’s Analytics.
20-metro
composite
10-metro
composite
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Median existing single-family home priceUnited States
Sources: National Association of Realtors, Moody’s Analytics.
20112010200920082007200620052004200320022001
20
10
0
-10
-20
Percent change, year ago
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Single-family housing startsUnited States
Sources: U.S. Census Bureau, IHS Global Insight.
20112010200920082007200620052004200320022001
1.8
1.6
1.4
1.2
1.0
0.8
0.6
0.4
0.2
Millions of units
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20112010200920082007200620052004200320022001
4.0
3.5
3.0
2.5
2.0
1.5
1.0
12
10
8
6
4
2
Millions Months
Housing inventoryExisting, Single-family homes, United States
Sources: NAR, Moody’s Analytics.
Months
supply (R)
Available
homes for
sale (L)
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20102009200820072006200520042003200220012000
3.8
3.6
3.4
3.2
3.0
2.8
2.6
2.4
1.6
1.4
1.2
1.0
0.8
0.6
0.4
0.2
Percent Percent
Delinquency rate
Percent of loans past due vs. those in foreclosure
Sources: Mortgage Bankers Association, Moody’s Analytics.
Percent of loans
past due 30 days (L)
Percent in
foreclosure (R)
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Eleven million homes are still under water
0
2
4
6
8
10
12
14
16
Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010
Number of mortgages, millions
Negative equity23%
Near negative
equity5%Others
72%
2010
Source: CoreLogic.
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Mortgage principal and interest payments Monthly payment amounts
Sources: National Association of Realtors, Moody’s Analytics.
111009080706050403020100
1200
1100
1000
900
800
700
600
US$
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Federal government net savingUnited States
Sources: Bureau of Economic Analysis, IHS Global Insight.
20102009200820072006200520042003200220012000
500
0
-500
-1000
-1500
US$ billions, SAAR
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Federal government deficit as percent of GDP
United States
Sources: Bureau of Economic Analysis, IHS Global Insight.
20102009200820072006200520042003200220012000
4.0
2.0
0.0
-2.0
-4.0
-6.0
-8.0
-10.0
-12.0
Percent
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Federal expenditures as percent of GDPUnited States
Sources: Bureau of Economic Analysis, IHS Global Insight.
20112010200920082007200620052004200320022001
26
24
22
20
18
Percent
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21201918171615141312111009080706
0
-200
-400
-600
-800
-1000
-1200
-1400
-1600
0
-2
-4
-6
-8
-10
-12
US$ billions Percent
CBO baseline projection
Federal budget deficit trajectoryCBO budget outlook
Source: Congressional Budget Office.
Level, (L)
As % of GDP, (R)
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21201918171615141312111009080706
26
24
22
20
18
16
14
Percent
CBO baseline projection
Revenues and outlays as share of GDPCBO budget outlook
Source: Congressional Budget Office.
Revenues
Outlays
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21201918171615141312111009080706
7.0
6.5
6.0
5.5
5.0
4.5
4.0
3.5
Percent
CBO baseline projection
Outlays for mandatory spending as share of GDPCBO budget outlook
Source: Congressional Budget Office.
Medicare and
Medicaid
Social Security
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Sources: Bureau of Economic Analysis, IHS Global Insight, Milken Institute.
Real GDP outlook
United States
20152014201320122011201020092008
6
4
2
0
-2
-4
-6
-8
Compound annual growth rate
Milken Institute projection
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Sources: Bureau of Labor Statistics, IHS Global Insight, Milken Institute.
Employment outlook
United States
20152014201320122011201020092008200720062005
4.0
2.0
0.0
-2.0
-4.0
-6.0
Percent change, year ago
Milken Institute projection
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Sources: U.S. Census, IHS Global Insight, Milken Institute.
Housing starts outlook
United States
20152014201320122011201020092008200720062005
1.8
1.6
1.4
1.2
1.0
0.8
0.6
0.4
0.2
Millions, annual rate
Milken Institute projection
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Sources: Bureau of Economic Analysis, IHS Global Insight, Milken Institute.
Business investment in equipment and software outlook
United States
20152014201320122011201020092008
30
20
10
0
-10
-20
-30
-40
Compound annual growth rate
Milken Institute projection
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Sources: Bureau of Economic Analysis, IHS Global Insight, Milken Institute.
Exports outlookUnited States
20152014201320122011201020092008
30
20
10
0
-10
-20
-30
-40
Percent change, year ago
Milken Institute projection
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Sources: Bureau of Economic Analysis, IHS Global Insight, Milken Institute.
Real consumer spending outlookUnited States
20152014201320122011201020092008
6
4
2
0
-2
-4
Compound annual growth rate
Milken Institute projection
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20152014201320122011201020092008200720062005
6
5
4
3
2
1
0
Percent
Milken Institute projection
Sources: Federal Reserve Board, IHS Global Insight, Milken Institute.
Interest rate outlookUnited States
Fed funds rate
10-year T-note yield
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Sources: Bureau of Labor Statistics, IHS Global Insight, Milken Institute.
Core CPI outlookUnited States
20152014201320122011201020092008200720062005
3.0
2.5
2.0
1.5
1.0
0.5
Percent change, year ago
Milken Institute projection
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100806040200989694929088
45
40
35
30
25
Tax rate
Statutory corporate income tax ratesOECD average vs. United States
Sources: OECD, Milken Institute.
United States
OECD average*
*OECD average includes Chile from 2000 onward
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National health expenditures per capita 1990-2019
Sources: Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group.
(1990)$2,853
(2009)$8,086
(2019)$13,387
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
Per Capita
Projected Per Capita
Historical Projected
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Deleveraging Has Just Begun
299%
of GDP
72%
of GDP29% of GDP
(%)
As of 31 December 2010
Source: U.S. Federal Reserve, U.S. Bureau of Economic Analysis, Morgan Stanley
363%
of GDP
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Consumers, in Particular,
Embraced Cheap Debt
As of 31 December 2010
*The assumed conforming borrowing rate is equal to Fannie Mae 30 Year MBS rate + 60bps from 1985 to 1996. From 1996, borrowing rate is average 30-year fixed
rate mortgage rate as published by BanxQuote and Bloomberg.
Source: U.S. Census Bureau, Fannie Mae, Bloomberg, BanxQuote
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Government Borrowing from non-Residents
As of April 2011
Source: IMF, Global Financial Stability Report
Most recent data for externally held general government debt (from Joint External Debt Hub) divided by 2010 gross general government debt.
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External Debt Across All Sectors
As of April 2011
Source: IMF, Global Financial Stability Report
1 Most recent data divided by 2010 GDP.
2 Calculated from assets and liabilities reported in a country’s international investment position.
Total Economy Gross External Liabilities1,2 Total Economy Net External Liabilities1,2
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U.S. CPI Composition
As of December 2010Source: Bureau of Labor Statistics
Housing 41%
Food and beverages15%
Transportation 17%
Other 26%
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Sustained Inflation Depends on Labor Pricing Power
Labor accounts for 65%-70% of the cost of goods sold in the U.S.
As of 20 April 2011
Source: Bureau of Economic Analysis, Bureau of Labor Statistics, Bloomberg
* Source: U.S. Census Bureau, Current Population Survey, 2008 Annual Social and Economic Supplement
(%)
15.7%
13.7%
9.5%
7.4%
4.4%
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The Implications of QE Diverge Based
on Net Worth
As of 2007
Source: Federal Reserve “Survey of Consumer Finances,” Census Bureau
90-100th Percentile75-89th Percentile50-74th Percentile25-49th Percentile1-24th Percentile
$44,727
$9,907$6,388
$1,628-$60
% of Total Net Worth -0.1% 2.5% 10.2% 15.8% 71.5%
Average Net Worth $-2,186 $58,060 $227,725 $588,623 $3,985,832
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The Implications of QE Diverge Based
on Net Worth
As of 2007
Source: Federal Reserve “Survey of Consumer Finances,” Census Bureau
Ownership of Financial Assets
(% of total value)
Ownership of Business Assets
(% of total value)Ownership Residential Assets
(% of total value)
1-24th Percentile
25-49th Percentile
50-74th Percentile
75-89th Percentile
90-100th Percentile
Total Value: $25.0T Total Value: $14.4T Total Value: $23.3T