An article yesterday presented six charts attributed to David Rosenberg (Gluskin Sheff, Toronto) that are said to show:
real and nominal (2 separate charts) GDP per capita 12 quarters after the end of each of six pre-2009 U.S. recessions dating back to Q1 1961. Each chart shows that the recovery from the latest technical recession has been significantly less than the average recovery, and somewhat less than the recovery from the worst recovery number of the previous six recessions. Interestingly, the worst recoveries of the seven (including the current recovery) were the last three.
the short-term (latest 31 months to July 2012) and long-term (from 1959) U.S. housing starts (2 separate charts). These charts clearly show how low U.S. housing starts currently are when measured against historic U.S. housing starts. On average, they look to me to be currently running at a rate about 50% of the average annual number of housing starts for the 48-year period ended 2007 (800 thousand per year currently versus about 1.6 million per year on average during said 48 year period).
The following table shows the U.S. population, and percentage growth in population during the 1959 – 2012 time period (millions – sources various). Note the comparatively consistent annual growth in absolute numbers per year over the 53-year period. This table, in combination with Mr. Rosenberg’s housing charts, puts current U.S. housing starts into even clearer ‘dampening’ perspective.
Year
U.S. Population
Growth (#’s)
Avg Annual Growth (#’s)
1959
177.1
-
-
1969
202.7
25.6
2.6
1979
225.1
22.4
2.2
1989
247.3
22.2
2.2
1999
275.6
28.3
2.8
2007
299.4
23.8
2.4
2012
313.0
13.6
2.7
the last two charts show S&P 500 ‘Sales per Share’, and U.S. corporate profits, in each case dating from 2003. I am not sure without speaking with Mr. Rosenberg why he thinks these show much about the U.S. economy viewed in isolation, as I think both charts inherently must include the impact of U.S. corporation profits that are earned both outside the U.S. and domestically within the U.S. – although Mr. Rosenberg may have segregated earnings generated outside the U.S. where the article – a summary of his work – hasn’t noted that.
Ian R. Campbell, FCA, FCBV, is a recognized Canadian business valuation authority who shares his perspective about the economy, mining and the oil & gas industry on each trading day. Ian is also the founder of Stock Research Portal, which provides stock market data, analysis and research on over 1,600 Mining, Oil and Gas Companies listed on the Toronto and Venture Exchanges. Note: The Commentary and information above is provided ‘AS IS’ and solely for informational purposes, not for trading purposes or advice.
