The U.S. Economy after the Election

Transcription

1 The U.S. Economy after the Election StorAksjekvelden 2012 U.S. Ambassador to Norway Barry B. White November 19, 2012

2 2012 election results Embassy of the United States Oslo Norway

3 2008 election results Embassy of the United States Oslo Norway

4 2012 election results - counties

5 Presidential election: popular votes 2012: 332 to 206 Popular vote % Obama 62,611, % Romney 59,134, % Other 1,968, % 2008: 365 to 173 Popular vote % Obama 69,492,376 53% McCain 59,946, % Other 1,703, % Only Indiana and North Carolina switched to Romney

6 The Congress Senate 2012 Democrats: 55 Republicans: 45 House of Rep. 2012* Democrats: 201 Republicans: 234 Senate 2010 Democrats: 53 Republicans: 47 House of Rep Democrats: 193 Republicans: 242 *House of Representatives votes: Democrats: 56 million Republicans: 55 million

7 Good vs. Bad Deficits COUTNTRY A Government expenditures All unproductive Tax Receipts $ 4T $ 3T COUTNTRY B Government expenditures One Trillion Productive $ 4T Tax Receipts $ 3T Deficit $ 1T Deficit $ 0T Paradox The Moral: It is the composition and quality of total government spending that matters, not simply the size of the deficit Source: Strategic Economic Decisions, Inc

8 Source: DB Global Markets Research

9 Sources: CBO, US Rates Strategy Group and DB Global Market Research

10 Sources: Baker, Bloom, and Davis (2012), Haver Analytics and DB Global Market Research

11 Sources: FRB, Haver Analytics, DB Global Markets Research

12 Sources: US Treasury, DB Global Market Research

13 Sources: Bloomberg, DB Global Markets Research

14 The U.S. Has Had 12 Consecutive Quarters of (Tepid) Economic Growth Embassy of the United States Oslo Norway 6 4 Previous estimate Latest estimate 4.1% 2 2.0% 1.3% 0 Q1 '07 Q2 '07 Q3 '07 Q4 '07 Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09 Q2 '09 Q3 '09 Q4 '09 Q1 '10 Q2 '10 Q3 '10 Q4 '10 Q1 '11 Q2 '11 Q3 '11 Q4 '11 Q1 '12 Q2 ' The Great Recession was more severe than previously thought. For Q4 08, the initial estimate was -3.8%; it was then revised to -6.8%; and currently to -8.9% Source: Bureau of Economic Analysis, through 9/27/12 report.

15 Consumer Confidence Index Consumer Confidence Has Rebounded in Recent Months, But Remains Weak Embassy of the United States Oslo Norway Source: Conference Board.

16 Change in Nonfarm Payroll Employment (000s) Job Creation Has Been Weak, Though It Has Been Positive for 30 Consecutive Months Embassy of the United States Oslo Norway Source: Bureau of Labor Statistics, nonfarm payrolls, seasonally adjusted.

17 Unemployment Rate Embassy of the United States Oslo Norway The Unemployment Rate Is Falling, Though It Remains High at 8.1% And the situation remains grim for the long-term unemployed (those jobless for more than half a year), who account for 40% of the unemployed 11% 10% 9% 8% 7% 6% 5% 4% 3% Source: Bureau of Labor Statistics, nonfarm payrolls, seasonally adjusted.

18 Job Losses Have Been More Severe Than Any Downturn Since the Great Depression And the Recovery Has Been Weak 3.5% of All Jobs Are Still Missing 0.0% Job loss -1.0% from peak -2.0% -3.0% -4.0% -5.0% The four most recent recessions have had the longest recoveries and they are taking longer and longer present -6.0% -7.0% Months after pre-recession peak Source: Bureau of Labor Statistics, nonfarm payrolls, seasonally adjusted.

19 The U.S. Has Run Deficits Over Much of the Past 40 Years, With the Widest Deficits Since WW II in the Aftermath of The Great Recession Source: OMB data, FactCheck.org,

20 Household Income Has Stagnated While National Debt Per Household Has Soared Embassy of the United States Oslo Norway Source: NY Times, The Dangerous Notion That Debt Doesn t Matter, Steven Rattner, 1/20/12.

21 Relative to the Last Two Recoveries, Private Non-Residential Investment Has Been Strong, But This Has Been Offset By a Weak Housing Market and Shrinking Government Spending and Jobs Percentage change since the start of each recovery Source: New York Times, 2/10/12.

22 The U.S. Economy after the Election StorAksjekvelden 2012 U.S. Ambassador to Norway Barry B. White November 19, 2012