brown sugar: deriving satisfaction through data analysis · ipsos global confidence index, june...

Brown Sugar:Deriving Satisfaction through

Data Analysis

By: Anirban BasuSage Policy Group, Inc.

On Behalf of

Louisiana Lt. Governor’s Tourism Summit

August 22nd, 2018

Disclaimer: Any resemblance between the presentation’s title and the speaker is purely coincidental.

Get off of My Cloud

IPSOS Global Confidence Index, June 2018

Source: IPSOS

Based on data from Thomson Reuters/Ipsos Primary Consumer Sentiment Index (PCSI).

2

© 2018 Ipsos

US

Largest drops

Turkey

South Africa

Argentina

CONSUMER CONFIDENCE GLOBAL SNAPSHOT Ipsos Consumer Confidence Index

June 2018

Canada

Mexico

Argentina

55.3/ +0.6

61.9/ -0.9

42.5/ -3.3

47.0 /+1.3

Brazil

42.7/ -1.2

50.7/+0.2

Great Britain

France

43.3/-2.4

Spain

44.3/+1.4 Italy

40.9/+2.3

South Africa43.1/ -3.8

Germany

56.8/ +0.2

Poland

51.0/-0.7Sweden

61.0/ -2.9

Hungary

45.2/ +1.2

Israel

55.1/+1.5

Turkey

37.9/-4.2

Saudi Arabia

57.9/+5.3

Russia

42.2/+1.4

China

71.2/+0.9

India

64.1/ -0.9

South Korea

47.7/+2.0

Japan

45.2/+0.2

Australia

53.8/-0.4

48.8/-1.0

Belgium

High Low

CountryIndex/3-month change

Change ≥ +1.5

Change ≥ -1.5

Largest gains

Saudi Arabia

Italy

South Korea

Global Average: 50.4

(3-month change: -0.1)

Highest (over 60) in:

China, India, U.S.,

Sweden

Lowest (below 40) in:

Turkey

Down in 5 countries:

Turkey, South Africa,

Argentina, Sweden,

France

Up in 4 countries:

Saudi Arabia, Italy, South

Korea, Israel

Based on data from Thomson Reuters/Ipsos Primary Consumer Sentiment Index (PCSI).

2

© 2018 Ipsos

US

Largest drops

Turkey

South Africa

Argentina

CONSUMER CONFIDENCE GLOBAL SNAPSHOT Ipsos Consumer Confidence Index

June 2018

Canada

Mexico

Argentina

55.3/ +0.6

61.9/ -0.9

42.5/ -3.3

47.0 /+1.3

Brazil

42.7/ -1.2

50.7/+0.2

Great Britain

France

43.3/-2.4

Spain

44.3/+1.4 Italy

40.9/+2.3

South Africa43.1/ -3.8

Germany

56.8/ +0.2

Poland

51.0/-0.7Sweden

61.0/ -2.9

Hungary

45.2/ +1.2

Israel

55.1/+1.5

Turkey

37.9/-4.2

Saudi Arabia

57.9/+5.3

Russia

42.2/+1.4

China

71.2/+0.9

India

64.1/ -0.9

South Korea

47.7/+2.0

Japan

45.2/+0.2

Australia

53.8/-0.4

48.8/-1.0

Belgium

High Low

CountryIndex/3-month change

Change ≥ +1.5

Change ≥ -1.5

Largest gains

Saudi Arabia

Italy

South Korea

Global Average: 50.4

(3-month change: -0.1)

Highest (over 60) in:

China, India, U.S.,

Sweden

Lowest (below 40) in:

Turkey

Down in 5 countries:

Turkey, South Africa,

Argentina, Sweden,

France

Up in 4 countries:

Saudi Arabia, Italy, South

Korea, Israel

50.4

The business confidence index (BCI) is based on enterprises’ assessment of production, orders and stocks, as well as its current position and expectations for the immediate future. Opinions compared to a “normal” state are collected and the difference between positive and negative answers provides a qualitative index on economic conditions.

OECD Business Confidence Index –Select Regions/CountriesJuly 2000 - July 2018

Source: OECD

94.0

95.0

96.0

97.0

98.0

99.0

100.0

101.0

102.0

103.0Ju

l-0

0

Jan

-01

Jul-

01

Jan

-02

Jul-

02

Jan

-03

Jul-

03

Jan

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Jul-

04

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Jul-

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Jan

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Jul-

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Jan

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Jul-

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Jan

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Jul-

11

Jan

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Jul-

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Jan

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Jul-

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Jan

-14

Jul-

14

Jan

-15

Jul-

15

Jan

-16

Jul-

16

Jan

-17

Jul-

17

Jan

-18

Jul-

18

OECD - Total Euro area (19 countries) United States

Note: Data for China for June and July are not available.

Travel Spending in the U.S. and AbroadJune 2013 – June 2018

Source: International Trade Administration, Office of Travel & Tourism Industries. *Spending reflects the purchases of goods and services by the U.S. persons abroad and foreign visitors in the U.S. for business and other reasons. Spending categories include food, lodging, recreation, local transportation, but exclude the amount spent on means of transportation to and from the U.S., as well as spending by those traveling for medical, educational or employment purposes.

-10%

-5%

0%

5%

10%

15%

20%Ju

n-1

3

Au

g-1

3

Oct

-13

Dec

-13

Feb

-14

Ap

r-14

Jun

-14

Au

g-1

4

Oct

-14

Dec

-14

Feb

-15

Ap

r-15

Jun

-15

Au

g-1

5

Oct

-15

Dec

-15

Feb

-16

Ap

r-16

Jun

-16

Au

g-1

6

Oct

-16

Dec

-16

Feb

-17

Ap

r-17

Jun

-17

Au

g-1

7

Oct

-17

Dec

-17

Feb

-18

Ap

r-18

Jun

-18

12-m

on

th %

ch

an

ge

U.S. Persons Traveling Abroad

Foreign Visitors to the U.S.

+5.5%

+1.9%

Global Monetary Policy Tightening/EasingAs of July 2018

The CFR Global Monetary Policy Tracker covers fifty-four large countries—mainly those that target inflation in some manner. Tightening policy is indicated in red, loosening in blue. The more a country has raised (lowered) rates, in percentage points, from the most recent trough (peak) in its policy rate, the darker the shade of red (blue). Generally, the policy rate target is the overnight interbank rate, with exceptions indicated.

Source: Council on Foreign Relations (CFR), Global Monetary Policy Tracker

Estimated Growth in Output by Select Global Areas2018 Projected

Source: International Monetary Fund: World Economic Outlook Update, July 2018

1.8%2.3%

1.6%3.5%

7.3%6.6%6.5%

1.7%4.3%

3.4%4.9%

2.9%3.0%

2.1%1.4%

1.0%2.8%

1.2%2.2%

1.8%2.2%2.4%

-6.0% -4.0% -2.0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0%

BrazilMexico

Latin America & the CaribbeanMiddle East, North Africa, Afghanistan, & Pakistan

IndiaChina

Emerging & Developing AsiaRussia

Emerging & Developing EuropeSub-Saharan Africa

Emerging Market & Developing EconomiesUnited States

CanadaAustralia

JapanItaly

United KingdomFrance

GermanySpain

Euro AreaAdvanced Economies

Annual % Change

2018 Proj. Global Output Growth: +3.9%

2017 Growth (Estimate)

World: 3.7% Euro Area: 2.4%

United States: 2.3% Japan: 1.7%

Start Me Up

0

20

40

60

80

100

120

140

200

5Ja

n-0

8A

pr-

08

Jul-

08

Oct

-08

Jan

-09

Ap

r-0

9Ju

l-0

9O

ct-0

9Ja

n-1

0A

pr-

10Ju

l-10

Oct

-10

Jan

-11

Ap

r-11

Jul-

11O

ct-1

1Ja

n-1

2A

pr-

12Ju

l-12

Oct

-12

Jan

-13

Ap

r-13

Jul-

13O

ct-1

3Ja

n-1

4A

pr-

14Ju

l-14

Oct

-14

Jan

-15

Ap

r-15

Jul-

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ct-1

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6A

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l-16

Oct

-16

Jan

-17

Ap

r-17

Jul-

17O

ct-1

7Ja

n-1

8A

pr-

18Ju

l-18

July 2018 = 127.4 where 1985 = 100

Conference Board Consumer Confidence Index2005 – July 2018

Source: Conference Board

NFIB Index of Small Business Optimism: Good Time to Expand1986-2018

Source: National Federation of Independent Business (NFIB)

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

Jul-

86

Jul-

87

Jul-

88

Jul-

89

Jul-

90

Jul-

91

Jul-

92

Jul-

93

Jul-

94

Jul-

95

Jul-

96

Jul-

97

Jul-

98

Jul-

99

Jul-

00

Jul-

01

Jul-

02

Jul-

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Jul-

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Jul-

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Jul-

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Jul-

07

Jul-

08

Jul-

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Jul-

10

Jul-

11

Jul-

12

Jul-

13

Jul-

14

Jul-

15

Jul-

16

Jul-

17

Jul-

18

July 2018:32%

% of respondents who think the next 3 months will be a good time to for small business to expand

Paint It Black – Corporate ProfitsU.S. Corporate Profits After Tax*

Source: U.S. Bureau of Economic Analysis *With Inventory Valuation Adjustment (IVA) and Capital Consumption Adjustment (CCAdj); Seasonally Adjusted Annual Rate

$0

$400

$800

$1,200

$1,600

$2,000

1950

Q1

1952

Q1

1954

Q1

1956

Q1

1958

Q1

196

0Q

1

196

2Q1

196

4Q

1

196

6Q

1

196

8Q

1

1970

Q1

1972

Q1

1974

Q1

1976

Q1

1978

Q1

198

0Q

1

198

2Q1

198

4Q

1

198

6Q

1

198

8Q

1

199

0Q

1

199

2Q1

199

4Q

1

199

6Q

1

199

8Q

1

200

0Q

1

200

2Q1

200

4Q

1

200

6Q

1

200

8Q

1

2010

Q1

2012

Q1

2014

Q1

2016

Q1

2018

Q1

$ Billions

2018Q1: $1.92 Trillion

U.S. Job OpeningsJune 2001 through June 2018

Source: U.S. Bureau of Labor Statistics

2.0

3.0

4.0

5.0

6.0

7.0Ju

n-0

1

Dec

-01

Jun

-02

Dec

-02

Jun

-03

Dec

-03

Jun

-04

Dec

-04

Jun

-05

Dec

-05

Jun

-06

Dec

-06

Jun

-07

Dec

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Jun

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Dec

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Jun

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-14

Dec

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Jun

-15

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Jun

-16

Dec

-16

Jun

-17

Dec

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Jun

-18

Job

Op

en

ing

s (M

illi

on

s)

June 2018:6.66M Openings

Net Change in U.S. JobsJuly 2002 through July 2018


-1000

-800

-600

-400

-200

0

200

400

600Ju

l-0

2N

ov-

02

Mar

-03

Jul-

03

No

v-0

3M

ar-0

4Ju

l-0

4N

ov-

04

Mar

-05

Jul-

05

No

v-0

5M

ar-0

6Ju

l-0

6N

ov-

06

Mar

-07

Jul-

07

No

v-0

7M

ar-0

8Ju

l-0

8N

ov-

08

Mar

-09

Jul-

09

No

v-0

9M

ar-1

0Ju

l-10

No

v-10

Mar

-11

Jul-

11N

ov-

11M

ar-1

2Ju

l-12

No

v-12

Mar

-13

Jul-

13N

ov-

13M

ar-1

4Ju

l-14

No

v-14

Mar

-15

Jul-

15N

ov-

15M

ar-1

6Ju

l-16

No

v-16

Mar

-17

Jul-

17N

ov-

17M

ar-1

8Ju

l-18

Th

ou

san

ds

July 2018:+157K

National Nonfarm Employmentby Industry Sector, July 2017 v. July 2018


-21

8

53

89

106

254

308

327

331

427

518

-50 50 150 250 350 450 550

Information

Government

Mining and Logging

Other Services

Financial Activities

Leisure and Hospitality

Construction

Manufacturing

Trade, Transportation, and Utilities

Education and Health Services

Professional and Business Services

Thousands, SA

All told 2,400K jobs gained

U.S. Labor Force Participation: Men Ages 25-342000 – 2018

Source: U.S. Bureau of Labor Statistics, Current Population Survey

88%

89%

90%

91%

92%

93%

94%

200

0Q

2

200

0Q

4

200

1Q2

200

1Q4

200

2Q2

200

2Q4

200

3Q2

200

3Q4

200

4Q

2

200

4Q

4

200

5Q2

200

5Q4

200

6Q

2

200

6Q

4

200

7Q2

200

7Q4

200

8Q

2

200

8Q

4

200

9Q

2

200

9Q

4

2010

Q2

2010

Q4

2011

Q2

2011

Q4

2012

Q2

2012

Q4

2013

Q2

2013

Q4

2014

Q2

2014

Q4

2015

Q2

2015

Q4

2016

Q2

2016

Q4

2017

Q2

2017

Q4

2018

Q2

89.2%

Louisiana Nonfarm Employmentby Industry Sector Groups (SA)July 2017 v. July 2018 Absolute Change


-2,700

-800

-300

1,500

1,600

1,800

2,600

3,600

3,800

4,800

4,900

-5,000 -3,000 -1,000 1,000 3,000 5,000

Government

Mining and Logging


Other Services

Information


Construction



Manufacturing


LA Total:

+20.8K; +1.1%

US Total (SA):

+2,400K; +1.6%

*According to the Local Area Unemployment Statistics (LAUS) seriesLA added 27,752 jobs between July 2017 and July 2018.

-200

-200

0

0

300

400

800

900

1,500

2,400

2,500

-1,000 -500 0 500 1,000 1,500 2,000 2,500 3,000

Information


Mining and Logging

Manufacturing

Other Services



Government



Construction

Baton Rouge, LA MSA Nonfarm Employmentby Industry Sector Groups (NSA)July 2017 v. July 2018 Absolute Change


Baton Rouge:

+8.4K; +2.1%

LA Total (SA):

+20.8K; +1.1%

US Total (SA):

+2,400K; +1.6%

-1,200

-100

0

200

500

1,100

1,400

1,500

1,700

2,100

2,500

-2,000 -1,000 0 1,000 2,000 3,000


Mining and Logging


Government

Other Services

Information

Manufacturing


Construction



New Orleans-Metairie, LA MSA Nonfarm Employmentby Industry Sector Groups (NSA)July 2017 v. July 2018 Absolute Change


New Orleans:

+9.7K; +1.7%

LA Total (SA):

+20.8K; +1.1%

US Total (SA):

+2,400K; +1.6%

Louisiana Select MSAs Leisure and Hospitality Employment (NSA)YOY Growth: July 2017 v. July 2018


MSAJuly 2017 v. July 2018

Net %

Lake Charles +400 +2.6%

Shreveport-Bossier City +300 +1.3%

Monroe +200 +2.5%

Houma-Thibodaux +100 +1.3%

New Orleans MSA Leisure and Hospitality Employment (NSA)July 2018


Industry SectorTotal

Employment (July 2018)

YOY

Net %

Arts, Entertainment, & Recreation 13,700 600 4.6%

Amusement, Gambling, & Recreation 7,600 -100 -1.3%

Accommodation & Food Services 77,500 1,900 2.5%

Accommodation 15,900 800 5.3%

Food Services & Drinking Places 61,600 1,100 1.8%

Total Leisure & Hospitality 91,200 2,500 2.8%

RANK STATE % RANK STATE % RANK STATE %

1 UTAH 3.5 18 MASSACHUSETTS 1.8 32 NEW YORK 1.2

2 IDAHO 3.4 18 NEW JERSEY 1.8 32 PENNSYLVANIA 1.2

2 NEVADA 3.4 18 OKLAHOMA 1.8 37 LOUISIANA 1.1

4 TEXAS 3.1 21 KANSAS 1.7 37 ALABAMA 1.1

4 WASHINGTON 3.1 21 NEBRASKA 1.7 37 ILLINOIS 1.1

6 COLORADO 2.9 21 SOUTH CAROLINA 1.7 37 MONTANA 1.1

7 FLORIDA 2.5 24 NEW MEXICO 1.6 41 CONNECTICUT 1.0

7 OREGON 2.5 24 VIRGINIA 1.6 41 WEST VIRGINIA 1.0

9 NORTH CAROLINA 2.4 26 MICHIGAN 1.5 43 ARKANSAS 0.9

10 ARIZONA 2.2 26 MINNESOTA 1.5 43 DISTRICT OF COLUMBIA 0.9

11 CALIFORNIA 2.0 26 OHIO 1.5 43 MAINE 0.9

11 WYOMING 2.0 29 DELAWARE 1.4 46 KENTUCKY 0.8

13 GEORGIA 1.9 29 SOUTH DAKOTA 1.4 47 MARYLAND 0.6

13 HAWAII 1.9 31 WISCONSIN 1.3 47 INDIANA 0.6

13 NEW HAMPSHIRE 1.9 32 IOWA 1.2 47 NORTH DAKOTA 0.6

13 RHODE ISLAND 1.9 32 MISSISSIPPI 1.2 50 VERMONT -0.3

13 TENNESSEE 1.9 32 MISSOURI 1.2 51 ALASKA -0.6

Employment Growth, U.S. States (SA) July 2017 v. July 2018 Percent Change


U.S. Year-over-year Percent Change: +1.6%

Unemployment Rates, 25 Largest Metros (NSA)June 2018

Source: U.S. Bureau of Labor Statistics, Current Employment Statistics (CES) Survey. Note: 1. Area boundaries do not reflect official OMB definitions.

U.S. Unemployment RateJune: 4.0% July: 3.9%

Rank MSA UR Rank MSA UR

1 Minneapolis-St. Paul-Bloomington, MN-WI 2.8 13 Charlotte-Concord-Gastonia, NC-SC 3.9

2 Denver-Aurora-Lakewood, CO 2.9 13 Miami-Fort Lauderdale-West Palm Beach, FL 3.9

3 San Francisco-Oakland-Hayward, CA 3.0 15 Atlanta-Sandy Springs-Roswell, GA 4.0

4 Orlando-Kissimmee-Sanford, FL 3.5 16 New York-Newark-Jersey City, NY-NJ-PA 4.1

5 Boston-Cambridge-Nashua, MA-NH 3.6 16 Seattle-Tacoma-Bellevue, WA 4.1

5 San Antonio-New Braunfels, TX 3.6 18 Phoenix-Mesa-Scottsdale, AZ 4.2

7Washington-Arlington-Alexandria, DC-VA-MD-WV

3.719 Philadelphia-Camden-Wilmington, PA-NJ-DE-MD 4.3

20 Chicago-Naperville-Elgin, IL-IN-WI 4.4

7 San Diego-Carlsbad, CA 3.7 20 Detroit-Warren-Dearborn, MI 4.4

7 St. Louis, MO-IL (1) 3.7 22 Los Angeles-Long Beach-Anaheim, CA 4.5

10 Dallas-Fort Worth-Arlington, TX 3.8 23 Baltimore-Columbia-Towson, MD 4.6

10 Portland-Vancouver-Hillsboro, OR-WA 3.8 23 Houston-The Woodlands-Sugar Land, TX 4.6

10 Tampa-St. Petersburg-Clearwater, FL 3.8 25 Riverside-San Bernardino-Ontario, CA 4.7

Gimme Shelter

15-Year & 30-Year Fixed Mortgage RatesAugust 1995 through August 2018*

Source: Freddie Mac

*Week ending 8/16/2018

4.01%

4.53%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%A

ug

-95

Feb

-96

Au

g-9

6F

eb-9

7A

ug

-97

Feb

-98

Au

g-9

8F

eb-9

9A

ug

-99

Feb

-00

Au

g-0

0F

eb-0

1A

ug

-01

Feb

-02

Au

g-0

2F

eb-0

3A

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-03

Feb

-04

Au

g-0

4F

eb-0

5A

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-05

Feb

-06

Au

g-0

6F

eb-0

7A

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-07

Feb

-08

Au

g-0

8F

eb-0

9A

ug

-09

Feb

-10

Au

g-1

0F

eb-1

1A

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-11

Feb

-12

Au

g-1

2F

eb-1

3A

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-13

Feb

-14

Au

g-1

4F

eb-1

5A

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-15

Feb

-16

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g-1

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-17

Feb

-18

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g-1

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Rat

e

15-yr 30-yr

U.S. Households: Owner v. Renter Occupied, 1965-2017

Source: U.S. Census Bureau; Pew Research Center

36.2

75.4 76.2

21.3

34.2

43.1

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

196

5

196

7

196

9

1971

1973

1975

1977

1979

198

1

198

3

198

5

198

7

198

9

199

1

199

3

199

5

199

7

199

9

200

1

200

3

200

5

200

7

200

9

2011

2013

2015

2017

# of Household Heads (Millions)

Homeowners

Renters

• From 2006-2017 the number of households headed by owners remained relatively flat.

• At the same time, the number of households renting their home increased significantly (+26%).

• The share of renter households also increased—from 31.2% of households in 2006 to 36.1% in 2017.

58%

60%

62%

64%

66%

68%

70%

198

0Q

219

81Q

219

82Q

219

83Q

219

84

Q2

198

5Q2

198

6Q

219

87Q

219

88

Q2

198

9Q

219

90

Q2

199

1Q2

199

2Q2

199

3Q2

199

4Q

219

95Q

219

96

Q2

199

7Q2

199

8Q

219

99

Q2

200

0Q

220

01Q

220

02Q

220

03Q

220

04

Q2

200

5Q2

200

6Q

220

07Q

220

08

Q2

200

9Q

220

10Q

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11Q

220

12Q

220

13Q

220

14Q

220

15Q

220

16Q

220

17Q

220

18Q

2

2018Q2:64.3%

U.S. Homeownership (NSA)1980Q2-2018Q2

Source: U.S. Census Bureau *NSA: not seasonally adjusted

$0

$10

$20

$30

$40

$50

$60

$70Ju

n-9

3

Jun

-94

Jun

-95

Jun

-96

Jun

-97

Jun

-98

Jun

-99

Jun

-00

Jun

-01

Jun

-02

Jun

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Jun

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Jun

-16

Jun

-17

Jun

-18

$ B

illi

on

s (S

AA

R)

U.S. Private New Multifamily ConstructionJune 1993 through June 2018

Source: U.S. Census Bureau

S&P Case-Shiller Home Price Indices for Select MetrosMay 2018, 12-Month Percentage Change

Source: Standard & Poor’s

0%

2%

4%

6%

8%

10%

12%

3.1% 3.3%4.2%

5.0%5.6% 5.6%

6.5%7.0% 7.1%

7.6%8.5%

10.9%

12.6%

12-M

on

th %

Ch

an

ge

19th

NervousBreakdown

Gross Domestic Product1990Q2 through 2018Q2*

Source: U.S. Bureau of Economic Analysis *1st (Advance) Estimate

-10%

-8%

-6%

-4%

-2%

0%

2%

4%

6%

8%19

90

Q2

199

1Q2

199

2Q2

199

3Q2

199

4Q

2

199

5Q2

199

6Q

2

199

7Q2

199

8Q

2

199

9Q

2

200

0Q

2

200

1Q2

200

2Q2

200

3Q2

200

4Q

2

200

5Q2

200

6Q

2

200

7Q2

200

8Q

2

200

9Q

2

2010

Q2

2011

Q2

2012

Q2

2013

Q2

2014

Q2

2015

Q2

2016

Q2

2017

Q2

2018

Q2

% C

ha

ng

e f

rom

Pre

ced

ing

Pe

rio

d (

SA

AR

) 2018Q2: +4.1%

Conference Board Leading Economic Indicators IndexAugust 2007 through July 2018

Source: Conference Board

-1.5%

-1.0%

-0.5%

0.0%

0.5%

1.0%

1.5%A

ug

-07

Jan

-08

Jun

-08

No

v-0

8

Ap

r-0

9

Sep

-09

Feb

-10

Jul-

10

Dec

-10

May

-11

Oct

-11

Mar

-12

Au

g-1

2

Jan

-13

Jun

-13

No

v-13

Ap

r-14

Sep

-14

Feb

-15

Jul-

15

Dec

-15

May

-16

Oct

-16

Mar

-17

Au

g-1

7

Jan

-18

Jun

-18

On

e-m

on

th P

erc

en

t C

ha

ng

e

July 2018: 110.7 where 2016: 100

Total U.S. Debt Volume by Select Loan Types, Index 1991Q1=100

Source: New York Fed Consumer Credit Panel/Equifax

0

50

100

150

200

250

300

350

400

199

9Q

219

99

Q4

200

0Q

220

00

Q4

200

1Q2

200

1Q4

200

2Q2

200

2Q4

200

3Q2

200

3Q4

200

4Q

220

04

Q4

200

5Q2

200

5Q4

200

6Q

220

06

Q4

200

7Q2

200

7Q4

200

8Q

220

08

Q4

200

9Q

220

09

Q4

2010

Q2

2010

Q4

2011

Q2

2011

Q4

2012

Q2

2012

Q4

2013

Q2

2013

Q4

2014

Q2

2014

Q4

2015

Q2

2015

Q4

2016

Q2

2016

Q4

2017

Q2

2017

Q4

2018

Q2

Mortgage

Auto

Credit Card

Global Debt Reaches All Time Highs (IIF)

Sources: 1. Institute of International Finance (IFF), Global Debt Monitor. 2. Business Insider. 3. The Telegraph. 4. Reuters.

• According to the International Institute of Finance (IIF), global debt has reached an all-time high in 2016;

• At $247 trillion as of 2018Q1, global debt—including household, government, and corporate—now represents 318% of global GDP;

• Last year the IMF warned of risks to the global economy:

• “sheer size of debt could set the stage for an unprecedented private deleveraging process that could thwart the fragile economic recovery”

Shiller Price-Earnings Ratio, 1980-2018

Source: Robert J. Shiller Data used in his book, "Irrational Exuberance" Princeton University Press.

0

10

20

30

40

50

Jul-

80

Jul-

81

Jul-

82

Jul-

83

Jul-

84

Jul-

85

Jul-

86

Jul-

87

Jul-

88

Jul-

89

Jul-

90

Jul-

91

Jul-

92

Jul-

93

Jul-

94

Jul-

95

Jul-

96

Jul-

97

Jul-

98

Jul-

99

Jul-

00

Jul-

01

Jul-

02

Jul-

03

Jul-

04

Jul-

05

Jul-

06

Jul-

07

Jul-

08

Jul-

09

Jul-

10

Jul-

11

Jul-

12

Jul-

13

Jul-

14

Jul-

15

Jul-

16

Jul-

17

Jul-

18

July 2018:32.17

Shattered! --- Bitcoin Price, 2014-2018

Source: CoinMarketCap.com

$0

$4,000

$8,000

$12,000

$16,000

$20,0008

/1/1

4

10/1

/14

12/1

/14

2/1/

15

4/1

/15

6/1

/15

8/1

/15

10/1

/15

12/1

/15

2/1/

16

4/1

/16

6/1

/16

8/1

/16

10/1

/16

12/1

/16

2/1/

17

4/1

/17

6/1

/17

8/1

/17

10/1

/17

12/1

/17

2/1/

18

4/1

/18

6/1

/18

8/1

/18

8/19/2018:$6.5K

Employer Costs for Employee Compensation2017Q1 v. 2018Q1

Source: U.S. Bureau of Labor Statistics *Private industry workers except for State & Local Government category.

-1.2%

0.0%

0.9%

1.9%

2.4%

3.2%

3.3%

4.9%

5.2%

5.7%

5.7%

-2.0% 0.0% 2.0% 4.0% 6.0%

Manufacturing

Other Services

Construction

Trade, Transportation, & Utilities

State & Local Government

All Private Industries

Professional & Business Services

Information

Education & Health Services

Leisure & Hospitality


% Change in Cost of Total Compensation Per Hour Worked

Time is on My Side, at least in the Near-Term

• U.S. setting up for best year since ’05. . .;

• Global economy better than it was -- still;

• Job opportunities are abundant;

• Corporate profitability elevated;

• Consumer and business confidence has been surging. . .;

• And now tax cuts, including major reductions in corporate taxes . . . What could go wrong?;

• A lot can go wrong – that’s always true – first there are the Black Swan threats:

• “I’m forever blowing bubbles, pretty bubbles in the air, they fly so high, nearly reach the sky, and like my dreams, they fade and die”;

• Where are all the pretty bubbles? Equity markets? U.S. bond market? Commercial real estate? Bitcoin?

• 2018 will be fine – better than fine –2019 might be, too, but beyond that, potential deleveraging cycle prompted by a repricing of assets – Bad!!!!

Thank YouPlease follow me on Twitter -- @sageanirban

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