February 2009 Economic Summary In Graphs

February Economic Summary in Graphs

http://www.calculatedriskblog.com/2009/02/february-economic-summary-in-graphs.html

The following contains graphs of recent valuable but depressing economic metrics.

Although the news is sobering, viewers are encouraged to grasp the magnitude of the current crisis

Please remove from reach any sharp objects, pens, pocket knives, razor blades or other potential weapons prior to viewing.

WARNING:

historically there is an "approximate nine to twelve month lag time between architecture billings and construction spending".

Architecture Billings Index - Jan. ‘96-08

Commercial (blue) is expected to drop soon and hard based upon the decrease in architectural billings

Residential and nonresidential construction spending since 1993

Case-Shiller Index looks at housing prices in the ten largest markets (blue) v. 20 largest markets (red) since 1992.

2008 : red bar

2007: orange bar

2006: blue bar

2005: green bar

2004: purple bar

Monthly existing Home Inventory

Existing Home Sales in January since 1992

Jan.1960-Jan. 2009: Employment measures and recessions:

unemployment rate (blue) the highest level since June 1992 (red = year over year change in employment)

the lowest level since the Census Bureau began tracking housing starts in 1959

Housing starts since 1968

decline in miles driven is worse than during the early '70s and 1979-1980 oil crisis

Vehicle miles driven per year since 1972

Monthly from January 2005 – January 2009

NAHB Builder Confidence Index in February

supply is at an all time record 13.3 months in January

New Home Months of Supply

Jan. 1962 – Jan. 2009

New Home Sales and recessions

2009 is red bar, 2008 is purple bar, 2007 is orange bar, 2006 is blue bar, 2005 is green bar

New Home Sales Monthly January

LA Port traffic loaded inbound (blue) v. loaded outbound (red) since 1962

Price to own house v. price to rent equivalent house 1987-2008

We are now back at year 2000 levels

Home ownership % since 1965

Retail sales (year over year) since 1993

Restaurant performance index since 2002

U.S. Imports and Exports Through December

Continued unemployment claims (red) v. Initial claims (blue) since 1972

Some economists predict all graphs will continue to deteriorate until MEDIAN HOME PRICES return to A METRIC OF 3 TIMES MEDIAN WAGES

Under the baseline scenario, nominal prices in the Composite 10 cities (Case Shiller looks at housing prices in the 10 largest U.S. housing markets.) would return to mid-2002 prices. Under the more severe scenario, prices would return to early 2001 prices.

CONCLUSION The economy will not touch bottom and

begin to rebound until housing prices stabilize.

Government intervention is intended to establish a floor in housing prices.

Will the government succeed? It is too early to know.