alliance trust plc economic update shona dobbie chief economist 3 may 2013
TRANSCRIPT
Alliance Trust PLCEconomic update
Shona DobbieChief Economist
3 May 2013
Source: INKCINCT Cartoons
US – housing and labour markets
0
10
20
30
40
50
60
70
80
03 04 05 06 07 08 09 10 11 12
NAHB Index
ProspectiveBuyers
Source: Reuters EcoWin
Housing Market Full-time/Part-time Employment
Index Ratio
98 00 02 04 06 08 10 123.9
4.1
4.3
4.5
4.7
4.9
5.1
US – corporate profitability
Source: Reuters EcoWin
Corporate profits and GDP US Corporate profits as % GDP
Index %
00 02 04 06 08 10 12
75
100
125
150
175
200
225
250
Corporate Profits
GDP
6
8
10
12
14
50 60 70 80 90 00 10
Rebased Jan 2000 = 100
US – weak fiscal position
Source: Reuters EcoWin
Outlays and receipts Federal debt
USD (billions) USD (thousand billions)
02 03 04 05 06 07 08 09 10 11 12
125
150
175
200
225
250
275
300
325
Federal Outlays
Federal Receipts
00 02 04 06 08 10 12
5
7
9
11
13
15
17
Federal DebtOutstanding
GDP
Current Debt Ceiling
US government debt and financing
Source: Reuters EcoWin
Government bond yield (10 year) Quantitative easing
% USD (thousand billions) GBP (billions)
07 08 09 10 11 12 13
1.0
2.0
3.0
4.0
5.0
6.0
US
UK
08 09 10 11 12 130
50
100
150
200
250
300
350
400
1.00
1.50
2.00
2.50
3.00
3.50
Fed TotalAssets (LHS)
BoE GiltPurchases (RHS)
Japan – poor economic performance
Source: Reuters EcoWin
Household spending and investment Government spending and exports
Index Index
02 03 04 05 06 07 08 09 10 11 12
85
90
95
100
105
110
115
Households
Investment
GDP
02 04 06 08 10 12
90
110
130
150
170
190
Government Spending
Exports
GDP
Japan – ‘Abenomics’
Source: Reuters EcoWin
Monetary base Confidence and asset prices
JPY (thousand billions) Index (diffusion) Index
96 98 00 02 04 06 08 10 12 14
50
75
100
125
150
175
200
225
250
275
600
800
1000
1200
1400
1600
15
25
35
45
55
65
06 07 08 09 10 11 12
Confidence (LHS)
Topix (RHS)
Japan – the end of deflation?
88 90 92 94 96 98 00 02 04 06 08 10 12
-0.75
0.00
0.75
1.50
-1.5
0.0
1.5
3.0
Labour Force (RHS)
Core CPI ( LHS)
5yr smoothing
Target CPI
Source: Reuters EcoWin
Yoy % change Yoy % change
Abenomics – impact on currency
Source: Reuters EcoWin
Index Rebase end June 2012 = 100
Jun12
Jul Aug Sep Oct Nov Dec Jan13
Feb Mar Apr
75
80
85
90
95
100
105
110
Sterling
Dollar
Yen
Euro
Europe – unemployment rates
Source: Reuters EcoWin
Periphery economies Core economies
% %
07 08 09 10 11 12 13
5.0
12.5
20.0
27.5
Spain
Greece
Eurozone
07 08 09 10 11 126
7
8
9
10
11
12
France
Eurozone
Germany
Europe – key policy rates
Source: Reuters EcoWin
%
03 04 05 06 07 08 09 10 11 12 13
0
1
2
3
4
5
6UK
Euro-Zone
China – exports and investment
Source: Reuters EcoWin
Exports Fixed asset investment (FAI)
USD (billions) % change yoy (3mma)
Source: NBS, In-house analysis
07 08 09 10 11 12 13
20
40
60
80
100
Asia
Europe
US
07 08 09 10 11 12
15.0
20.0
25.0
30.0
35.0
40.0
Total
Manufacturing
China – structural change?
Source: Reuters EcoWin
GDP growth Breakdown of GDP
% change yoy % of GDP
08 09 10 11 12
6
7
8
9
10
11
12
13
90 92 94 96 98 00 02 04 06 08 10
25.0
30.0
35.0
40.0
45.0
50.0
Investment
Household Spending
A busy year
Important information
• Whilst considerable care has been taken in compiling the content of this presentation, no representation or warranty, expressed or implied, is made by Alliance Trust PLC as to its accuracy or completeness.
• The value of investments and the income from them may go down as well as up and are not guaranteed. The original amount invested may not be returned.
• Any examples are for illustration purposes only, the figures are not guaranteed and should not be relied on.
• Past performance is not a guide to future performance.
• Further information is available on our website www.alliancetrust.co.uk
• All figures and graphs are sourced at Alliance Trust PLC unless otherwise stated.
• Nothing said or covered by the presentation today should be construed as being an inducement or invitation in investment activity. No advice is given by Alliance Trust PLC.