warren jestin svp & chief economist as the world turns presentation to: international society of...
TRANSCRIPT
Warren JestinSVP & Chief Economist
As The World Turns
Presentation to:
International Society of Hospitality Consultants
Quebec City, October 2, 2009
-8
-6
-4
-2
0
2
4
6
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10
China India Brazil Mexico Russia
2008
2009f
2010f
Emerging Nations Remain Growth Leaders
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-6
-4
-2
0
2
4
6
8
10
Canada U.S. Euro-zone
Japan
2008
2009f
2010f
G7 Set for an Uneven Recovery
real GDP, average annual % change
The Global Economy Is Beginning to Revive
real GDP, average annual % change
The Freefall in U.S. Housing and Autos is Over . . .
0
3
6
9
12
15
02 03 04 05 06 07 08 09
0.4
0.8
1.2
1.6
2.0
2.4months’ supply
Housing Starts (RHS)
mn units
Housing Starts & Inventories
Inventories (LHS)
Vehicle Sales & Inventories
25
30
35
40
45
50
55
60
65
70
75
80
85
90
95
100
02 03 04 05 06 07 08 09
8
9
10
11
12
13
14
15
16
17
18
19
20
21
US New Vehicle Sales
(RHS)
US Dealer Inventories
(LHS)
days’ supply millions of units
0
2
4
6
8
10
12
14
16
02 03 04 05 06 07 08 09
. . . but U.S. Private & Public Financial Strains Remain Intense
U.S. Federal Revenues SlideRising U.S. Foreclosures
-60
-50
-40
-30
-20
-10
0
10
20
30
40
50
60
02 03 04 05 06 07 08 09
12-month moving sum, y/y % change
Personal Income
Tax
Total Revenues
Corporate Income Tax
Source: U.S. Treasury.Source: Bloomberg.
Subprime Foreclosures
(RHS)
Prime Foreclosures(LHS)
% of total loans
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
Africa
Europe
India
China
Other America
U.S./Canada
billions, 2008*
Emerging Markets Will Underpin the Recovery . . .
*IMF estimate
CHINA
INDIA
EU-12
JAPAN
CAN-U.S.
% of global GDP, 2008*
Global GDP (PPP)Population
RUSSIA
MEXICO
BRAZIL
Other Asia/Oceania
*IMF estimate
-30
-25
-20
-15
-10
-5
0
5
10
JA
PA
N
ITA
LY
GE
RM
AN
Y
FR
AN
CE
US
RU
SS
IA
CA
NA
DA
UK
ME
XIC
O
BR
AZ
IL
IND
IA
CH
INA
. . . Drive Commodity Prices Higher . . .
Industrial Production
y/y % change, 2009Q2
Blue bar represents price at September 25, 2009. Red bars represent Scotia Economics 2010F (average price).Historical end of day observations; Source: Bloomberg.
Price Fluctuations Since January 2008
HighLow
US$/bbl145.2965.98OIL 33.87
HighLow
US$/mmbtu
13.58NATURAL
GAS
Low High
US$/lb4.082.71COPPER 1.26
Low High
US$/lb24.587.724.00NICKEL
3.97
90.00
2.90
7.45
5.252.51
HighLow
US$/kl1127503
JET FUEL 336
80
90
100
110
120
130
140
150
02 03 04 05 06 07 08 09ytd
index: 2002=100
Europe
Tourist Arrivals Accelerate
Americas
Asia
. . . & Become Increasingly Important To the Tourist Industry
Source: WTO
0
10
20
30
40
50
60
70
80
90
100
Sources of Tourist Dollars – Selected Countries
US$ billions, 2008
GE
RM
AN
Y
UN
ITE
D S
TA
TE
S
UN
ITE
D K
ING
DO
M
FR
AN
CE
CH
INA
ITA
LY
JA
PA
N
CA
NA
DA
RU
SS
IA
NE
TH
ER
LA
ND
S
KO
RE
A
HO
NG
KO
NG
BR
AZ
IL
-1
0
1
2
3
4
5
6
7
02 03 04 05 06 07 08 09 10
Central Bank Rates
Central Banks Will Provide Less Monetary Stimulus in 2010
JapanU.S.
forecast
%
U.K.
Euro zone
-1
0
1
2
3
4
5
6
7
02 03 04 05 06 07 08 09 10
Global Inflation
annual % change
Euro zone
U.S.
Japan
U.K.
forecast
U.S. Fiscal Deficit Soars
-1800
-1600
-1400
-1200
-1000
-800
-600
-400
-200
0
02 03 04 05 06 07 08 09 10
-1800
-1600
-1400
-1200
-1000
-800
-600
-400
-200
0
US$ billions forecast
Balance ex. Social SecurityFederal Budget Balance
US$ Shows Signs of Weakening
CAD
$
Yuan
元
Yen ¥
Euro
€ Merchandise Trade Balance
Low High
1.030.92
Low
1.601.47
1.26112 89 87
Low
6.816.837.30
High
High
HighLow
1.25
US$ Exchange Rates Since January 2008
0.77
Look for Currency Volatility & Renewed U.S. Dollar Weakness
1.00
1.57
89
6.45
Blue bar represents spot price at September 25, 2009. Red bars represent Scotia Economics 2010F (average).Historical end of day observations; Source: Bloomberg.
On the Horizon – Tourism must adjust to an Older & Greener World
0
5
10
15
20
25
30
35
40
2005 2015 2030
Total Emissions
gigatonnes
0
2
4
6
8
10
2005 2015 2030
World
China
India
Europe
U.S.
gigatonnes
1
6
11
16
21
26
31
36
41
46
51
1990 2015
Median Age (years)
Source: IMF
08 09f 10f
REAL GDP
U.S. 0.4 -2.5 3.0
Canada 0.4 -2.3 2.8
U.K. 0.7 -3.4 1.2
Euro zone 0.8 -3.8 1.5
Japan -0.7 -5.7 1.1
China 9.0 8.0 9.3
INFLATION
U.S. 3.8 -0.5 1.9
Canada 2.4 0.8 2.1
U.K. 3.1 1.0 2.0
Euro zone 1.6 1.0 1.3
Japan 0.4 -0.5 -0.3
China 1.2 -0.5 1.5
08 09f 10f
CURRENCIES & RATES, end of period
USD/CAD 1.22 1.04 1.00
EUR/USD 1.40 1.50 1.60
USD/YEN 91 95 85
USD/YUAN 6.8 6.8 6.3
U.S. Fed Funds Target Rate 0.25 0.25 1.75
U.S. 10-year Treasury 2.21 3.75 4.95
COMMODITIES, annual average
WTI Oil (US$/bbl) 99.62 62 90
Nymex Natural Gas (US$/mmbtu)
8.90 3.90 5.25
Copper (US$/lb) 3.15 2.30 2.90
Disclaimer
This report has been prepared by Scotia Economics as a resource for the clients of Scotiabank and Scotia Capital. Opinions, estimates and projections contained herein are our own as of the date hereof and are subject to change without notice. The information and opinions contained herein have been compiled or arrived at from sources believed reliable but no representation or warranty, express or implied, is made as to their accuracy or completeness. Neither Scotiabank Group nor its affiliates accepts any liability whatsoever for any loss arising from any use of this report or its contents.