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Predicting the Markets:Chapter 5 Charts:
Predicting Business CyclesYardeni Research, Inc.
June 5, 2020
Dr. Edward YardeniChief Investment Strategist
Mali QuintanaSenior Economist
Please visit our sites atwww.yardeni.comblog.yardeni.com
thinking outside the box
Table Of Contents Table Of ContentsTable Of Contents
June 5, 2020 / Chapter 5 Charts: Predicting Business Cycles www.yardeni.com
Yardeni Research, Inc.
Predicting Business Cycles 1-27
48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 241.5
3.5
5.5
7.5
9.5
11.5
13.5
15.5
17.519.521.5
1.5
3.5
5.5
7.5
9.5
11.5
13.5
15.5
17.519.521.5
REAL GDP(trillion 2012 dollars, saar, ratio scale)
Q1
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
yardeni.com
Figure 1.
48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24-15
-10
-5
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5
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20
-15
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-5
0
5
10
15
20
P T PT PT PT P T P T PT P T PT PT P T
REAL GDP(quarterly percent change, saar)
Q1
Note: Business cycle peaks (P) and troughs (T) according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
yardeni.com
Figure 2.
Predicting Business Cycles
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48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24-5
0
5
10
15
20
25
-5
0
5
10
15
20
25
US NOMINAL GDP(yearly percent change)
Q1
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
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Figure 3.
48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24-50
-25
0
25
50
75
100
125
-50
-25
0
25
50
75
100
125
CORPORATE AFTER-TAX PROFITS REPORTED TO IRS*(yearly percent change)
Q1
* After-tax profits as reported to IRS, excluding IVA and CCAdjNote: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
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Figure 4.
Predicting Business Cycles
Page 2 / June 5, 2020 / Chapter 5 Charts: Predicting Business Cycles www.yardeni.com
Yardeni Research, Inc.
19211925
19291933
19371941
19451949
19531957
19611965
19691973
19771981
19851989
19931997
20012005
20092013
20172021
2025
2
802
1602
240232024002
2
802
1602
240232024002
S&P 500 & RECESSIONS(ratio scale)
May
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Standard & Poor’s.
yardeni.com
Figure 5.
21 25 29 33 37 41 45 49 53 57 61 65 69 73 77 81 85 89 93 97 01 05 09 13 17 21 252
802
1602
240232024002
2
802
1602
240232024002
T PT PT P T PT PT PT PT PT PT PT P T PTP T PT PT P T
S&P 500 BULL & BEAR MARKETS& THE BUSINESS CYCLE
(monthly, ratio scale)
May
Note: Shaded green areas denote S&P 500 bull markets, while red areas are bear market declines of 20% or more.Business cycle peaks (P) and troughs (T) according to the National Bureau of Economic Research.Source: Standard & Poor’s.
yardeni.com
Figure 6.
Predicting Business Cycles
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62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 240
5
10
15
20
0
5
10
15
20
US TREASURY 10-YEAR BOND YIELD(percent, weekly)
5/29yardeni.com
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Federal Reserve Board.
Figure 7.
54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 240
100
200
300
400
500
600
0
100
200
300
400
500
600
INVESTMENT-GRADE CORPORATE BOND YIELDMINUS US TREASURY 10-YEAR BOND YIELD*
(basis points)
May
* Corporate bond yield is average of Moody’s Aaa and Baa yields through 1996, then average of BoA Merrill Lynch data for AA-AAA and BBB-A yields.Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Federal Reserve Board and Haver Analytics.
yardeni.com
Figure 8.
Predicting Business Cycles
Page 4 / June 5, 2020 / Chapter 5 Charts: Predicting Business Cycles www.yardeni.com
Yardeni Research, Inc.
Figure 9.
59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 2350
70
90
110
130
150
170
50
70
90
110
130
150
170
COMPONENTS OFCOINCIDENT ECONOMIC INDICATORS
(ratio scale)
Payroll Employment(millions, sa)
May
59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 231.5
3.5
5.5
7.5
9.511.513.515.517.5
1.5
3.5
5.5
7.5
9.511.513.515.517.5
Real Personal Income LessTransfer Payments
(trillion 2012 dollars, saar)
Apr
59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23200
400
600
800
10001200140016001800
200
400
600
800
10001200140016001800
Manufacturing & Trade Sales(billion 2012 dollars)
Apr
59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 2320
40
60
80
100
120140
20
40
60
80
100
120140
Industrial Production2012=100, sa
Apr
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Labor Statistics, Bureau of Economic Analysis, Census Bureau, and Federal Reserve Board.
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Predicting Business Cycles
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Yardeni Research, Inc.
59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 2320
30
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20
30
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COINCIDENT ECONOMIC INDICATORS(2016=100, sa, ratio scale)
Apr
Note: Shaded areas denote recessions according to the National Bureau of Economic ResearchSource: Conference Board.
yardeni.com
Figure 10.
60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24-10
0
10
20
-10
0
10
20
REAL GDP & COINCIDENT ECONOMIC INDICATORS(yearly percent change)
Apr
CEIReal GDP
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis and Conference Board.
yardeni.com
Figure 11.
Predicting Business Cycles
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Yardeni Research, Inc.
47 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23.4
1.1
1.8
2.5
3.2
3.9
4.6
5.36.06.7
.4
1.1
1.8
2.5
3.2
3.9
4.6
5.36.06.7
REAL GDP: GOODS(trillion 2012 dollars, saar, ratio scale)
Q1
Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
yardeni.com
Figure 12.
47 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 231
3
5
7
9
11
13
1
3
5
7
9
11
13
REAL GDP: SERVICES(trillion 2012 dollars, saar, ratio scale)
Q1
Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
yardeni.com
Figure 13.
Predicting Business Cycles
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Yardeni Research, Inc.
59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 2320
30
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110
120130140
20
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100
110
120130140
LEADING & COINCIDENT ECONOMIC INDICATORS(2016=100, sa, ratio scale)
Apr
CEILEI
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Conference Board.
yardeni.com
Figure 14.
67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23.8
.9
1.0
1.1
1.2
1.3
1.4
.8
.9
1.0
1.1
1.2
1.3
1.4
RATIO LEADING TO COINCIDENT ECONOMIC INDICATORS
Apr
Note: Shaded areas denote recessions according to the National Bureau of Economic ResearchSource: Conference Board.
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Figure 15.
Predicting Business Cycles
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2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 202220
30
40
50
60
70
20
30
40
50
60
70
May
ADP NONFARM PRIVATE PAYROLL EMPLOYMENT BY COMPANY SIZE(millions, sa)
Company Size (by employees)Small (1-49)Medium (50-499)Large (over 500)
Source: ADP.
yardeni.com
Figure 16.
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 202220
30
40
50
60
20
30
40
50
60
May
ADP NONFARM PRIVATE PAYROLL EMPLOYMENT BY COMPANY SIZE*(as a percent of total ADP payrolls)
Company Size (by employees)SmallMediumLarge
* Company size by employees: Small (1-49), Medium (50-499), and Large (over 500).Source: ADP.
yardeni.com
Figure 17.
Predicting Business Cycles
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74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24-50
-40
-30
-20
-10
0
-10
0
10
20
30
May
Apr
NFIB SMALL BUSINESS SURVEY: EARNINGS & EMPLOYMENT PLANS(12-month average percent)
Earnings Over Past 3 Months*(higher minus lower)
Expecting ToIncrease Employment*(next 3 months)
* First month of every quarter from 1974 to 1986, then 12-month average.Source: National Federation of Independent Business.
yardeni.com
Figure 18.
74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24-50
-40
-30
-20
-10
0
0
10
20
30
40
Apr
Apr
NFIB SMALL BUSINESS SURVEY: EARNINGS & CAPITAL SPENDING PLANS(12-month average, percent)
Earnings Over Past 3 Months* (higher minus lower)
Capital Spending Plans* (next 3 to 6 months)
* First month of every quarter from 1974 to 1986, then 12-month average.Source: National Federation of Independent Business.
yardeni.com
Figure 19.
Predicting Business Cycles
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48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 2210
510
1010
1510
201025103010
10
510
1010
1510
201025103010
CORPORATE AFTER-TAX PROFITS REPORTED TO IRS*(billion dollars, saar, ratio scale) Q1
* Excluding Inventory Valuation Adjustment and Capital Consumption Adjustment.Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
yardeni.com
Figure 20.
48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 2410
510
1010
1510
201025103010
30
50
70
90
110
PAYROLL EMPLOYMENT EX GOVERNMENT EMPLOYMENT &CORPORATE AFTER-TAX PROFITS
(ratio scale) MayQ1
Payroll Employment ExGovernment Employment(millions,sa)
Corporate After-tax ProfitsReported to IRS*(billion dollars, saar)
* Excluding Inventory Valuation Adjustment and Capital Consumption Adjustment.Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Labor Statistics and Bureau of Economic Analysis.
yardeni.com
Figure 21.
Predicting Business Cycles
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47 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23 252
4
6
8
10
12
2
4
6
8
10
12
CORPORATE PROFITS MARGIN IN GDP*(after-tax profits as a percent of nominal GDP)
Q1
yardeni.com
* Using after-tax corporate profits reported to IRS. Excluding Inventory Valuation Adjustment and Capital Consumption Adjustment.Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
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Figure 22.
48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 242
4
6
8
10
12
60
65
70
75
Q1
AFTER-TAX CORPORATE PROFIT MARGIN & COSTS
Q1
Compensation of Employees PlusPrivate Fixed Investment(as a percent of nominal GDP)
Corporate Profits After Tax*(as a percent of nominal GDP)
* After-tax tax profits reported to IRS (excluding Inventory Valuation Adjustment and Capital Consumption Adjustment).
Source: Bureau of Economic Analysis.Note: Shaded areas denote recessions according to the National Bureau of Economic Research.
yardeni.com
Figure 23.
Predicting Business Cycles
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68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 2472
74
76
78
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86
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90
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96
72
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78
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82
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96
RESOURCE UTILIZATION RATE*(percent)
Apr
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.* Average of all industries’ capacity utilization rate and employment rate, i.e., percentage of labor force that is employed.
Source: Bureau of Labor Statistics and Federal Reserve Board.
yardeni.com
Figure 24.
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 2460
64
68
72
76
80
84
88
92
80
82
84
86
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90
92
94
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98
100
RESOURCE UTILIZATION RATE COMPONENTS(percent)
May
Apr
Employment Rate*
Capacity Utilization Rate
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.* Percentage of labor force that is employed.
Source: Bureau of Labor Statistics and Federal Reserve Board.
yardeni.com
Figure 25.
Predicting Business Cycles
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Yardeni Research, Inc.
67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 2372
74
76
78
80
82
84
86
88
90
92
94
96
2
4
6
8
10
12
14
CORPORATE PROFITS MARGIN IN GDP* & RESOURCE UTILIZATION RATE(after-tax profits as a percent of nominal GDP)
Q1
Apr
yardeni.com
Profit Margin*
Resource Utilization Rate**
* After-tax profits reported to IRS (excluding Inventory Valuation Adjustment and Capital Consumption Adjustment).** Average of all industries’ capacity utilization rate and employment rate, i.e., percentage of labor force that is employed.
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis, Bureau of Labor Statistics, and Federal Reserve Board.
yardeni.com
Figure 26.
67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23.5
.6
.7
.8
.9
1.0
1.1
1.2
1.3
1.4
75
80
85
90
95
100
LEI / CEI vs. RESOURCE UTILIZATION RATE
Apr
LEI / CEI
Resource Utilization Rate*
* Average of all industries’ capacity utilization rate and employment rate, i.e., percentage of labor force that is employed.Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis, Bureau of Labor Statistics, Federal Reserve Board, and Conference Board.
yardeni.com
Figure 27.
Predicting Business Cycles
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80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22-40
-30
-20
-10
0
10
20
30
40
-18
-14
-10
-6
-2
2
6
10
14
18
May
S&P 500 FORWARD EARNINGS & AGGREGATE WEEKLY HOURS(yearly percent change)
Aggregate Weekly Hours**
Forward Earnings*
Source: Bureau of Labor Statistics and Thomson Reuters I/B/E/S.
* Time-weighted average of consensus operating earnings estimates for current and next year.** Production & nonsupervisory employees.
yardeni.com
Figure 28.
88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22-40
-30
-20
-10
0
10
20
30
40
-40
-30
-20
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0
10
20
30
40
May
S&P 500 FORWARD EARNINGS & REAL CAPITAL SPENDING(yearly percent change)
Real Capital Spending**Forward Earnings*
** Nonresidential fixed investment in real GDP.* Time-weighted average of consensus operating earnings estimates for current and next year. Monthly through March 1994, weekly thereafter.
Source: Bureau of Economic Analysis and Thomson Reuters I/B/E/S.
yardeni.com
Figure 29.
Predicting Business Cycles
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59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 2325
35
45
55
65
75
85
95
105
115
125
25
35
45
55
65
75
85
95
105
115
125
68 Months1/08-10/1333 Months
2/01-11/03
23 Months7/90-6/92
25 Months8/81-9/83
32 Months11/73-7/76
19 Months10/69-5/71
30 Months5/71-11/73
61 Months7/76-8/81
82 Months9/83-7/90
104 Months6/92-2/01
50 Months11/03-1/08
Apr
COINCIDENT ECONOMIC INDICATORS: RECOVERIES & EXPANSIONS*(2016=100, sa, ratio scale)
* Red horizontal lines span cyclical peaks through subsequent cyclical recoveries. Green horizontal lines are expansion periods following recoveries.Source: Conference Board, Haver Analytics, and YRI calculations.
yardeni.com
Figure 30.
47 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 231000
3000
5000
7000
9000
11000
13000
15000
1000
3000
5000
7000
9000
11000
13000
15000
PERSONAL CONSUMPTION EXPENDITURES IN REAL GDP: TOTAL(billion 2012 dollars, saar, ratio scale)
Q1
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
yardeni.com
Figure 31.
Predicting Business Cycles
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47 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 2340
260
480
700
920
1140
1360158018002020
40
260
480
700
920
1140
1360158018002020
PERSONAL CONSUMPTION EXPENDITURES IN REAL GDP: DURABLE GOODS(billion 2012 dollars, saar ratio scale)
Q1
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
yardeni.com
Figure 32.
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 241
301
601
901
1201
1501
1801
1
301
601
901
1201
1501
1801
CONSUMER CREDIT(billion dollars outstanding, nsa)
Q4
Q4
Q4
Credit Card LoansAuto LoansStudent Loans
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Federal Reserve Board.
yardeni.com
Figure 33.
Predicting Business Cycles
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59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23 25.3
.5
.7
.9
1.1
1.3
1.5
1.7
1.9
2.1
2.3
2.5
2.7
2.9
.3
.5
.7
.9
1.1
1.3
1.5
1.7
1.9
2.1
2.3
2.5
2.7
2.9
HOUSING STARTS(million units, saar)
Apr
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Census Bureau.
yardeni.com
Figure 34.
48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24100
200
300
400
500
600
700
800
900
1000
100
200
300
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500
600
700
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900
1000
PRIVATE RESIDENTIAL INVESTMENT IN REAL GDP(billion 2012 dollars, saar, ratio scale)
Q1
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
yardeni.com
Figure 35.
Predicting Business Cycles
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Yardeni Research, Inc.
48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 240
5
10
15
0
5
10
15
UNEMPLOYMENT RATE(percent, sa)
May
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Labor Statistics.
yardeni.com
Figure 36.
47 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23.1
.6
1.1
1.6
2.1
2.6
3.1
.1
.6
1.1
1.6
2.1
2.6
3.1
PRIVATE NONRESIDENTIAL FIXED INVESTMENT IN REAL GDP(trillion 2012 dollars, saar, ratio scale)
Q1
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
yardeni.com
Figure 37.
Predicting Business Cycles
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80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 221.3
1.4
1.5
1.6
1.7
1.3
1.4
1.5
1.6
1.7
REAL BUSINESS INVENTORIES-TO-SALES RATIO
Mar
Source: Census Bureau.Note: Shaded areas denote recessions according to the National Bureau of Economic Research.
yardeni.com
Figure 38.
48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24-300
-200
-100
0
100
200
-300
-200
-100
0
100
200
P T PT PT PT P T P T PT P T PT PT P T
INVENTORY INVESTMENT IN REAL GDP(billion 2012 dollars, saar)
Q1
Note: Business cycle peaks (P) and troughs (T) according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
yardeni.com
Figure 39.
Predicting Business Cycles
Page 20 / June 5, 2020 / Chapter 5 Charts: Predicting Business Cycles www.yardeni.com
Yardeni Research, Inc.
47 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 2320
40
60
80
100
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20
40
60
80
100
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NONFARM PRODUCTIVITY(2012=100, sa, ratio scale)
Q1
yardeni.com
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Federal Reserve Board.
Figure 40.
47 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 2316
36
56
76
96
116
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96
116
NONFARM UNIT LABOR COSTS(2012=100, sa, ratio scale)
Q1
yardeni.com
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Federal Reserve Board.
Figure 41.
Predicting Business Cycles
Page 21 / June 5, 2020 / Chapter 5 Charts: Predicting Business Cycles www.yardeni.com
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54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24-2
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FEDERAL FUNDS RATE& BUSINESS CYCLE
(percent, weekly)
5/27
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Federal Reserve Board.
yard
eni.c
om
Figure 42.
60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 240
5
10
15
20
25
0
5
10
15
20
25
1970Penn
Central
1974FranklinNational
1980SilverBubble
1982Drysdale& Mexico
1984Continental
Illinois
1987Black
Monday
1990S&LCrisis
1994Mexican
Peso
1997Pacific
Rim
1998Russia& LTCM
2000Tech
Bubble
20019/11
Attacks
2007SubprimeMeltdown
2008Lehman & AIG
FEDERAL FUNDS RATE & FINANCIAL CRISES(percent, weekly)
5/27
Note: Blue shaded areas denote periods of monetary easing between cyclical peaks and troughs in the federal funds rate. Red shaded areas denotemonetary tightening periods.Source: Federal Reserve Board.
yard
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om
Figure 43.
Predicting Business Cycles
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62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24-800
-600
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200
400
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US YIELD CURVE* &BUSINESS CYCLE
(basis points, weekly)
5/29
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.* 10-year US Treasury yield less federal funds rate.
Source: Federal Reserve Board.
yardeni.com
Figure 44.
62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24-800
-700
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0
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1970Penn
Central
1974FranklinNational 1980
SilverBubble
1982Drysdale& Mexico
1984Continental
Illinois
1987Black
Monday
1990S&LCrisis
1994Mexican
Peso
1997Pacific
Rim
1998Russia& LTCM
2000Tech
Bubble
20019/11
Attacks
2007SubprimeMeltdown
2008Lehman & AIG
US YIELD CURVE* &FINANCIAL CRISES
(basis points, weekly)
5/29
* US Treasury 10-year bond yield less federal funds rate.Source: Federal Reserve Board.
yardeni.com
Figure 45.
Predicting Business Cycles
Page 23 / June 5, 2020 / Chapter 5 Charts: Predicting Business Cycles www.yardeni.com
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47 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23 2512
14
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US FEDERAL GOVERNMENT EXPENDITURES & RECEIPTS(as a percent of nominal GDP)
Q1
Q1
ExpendituresReceipts
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
yardeni.com
Figure 46.
47 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23 25-5
-4
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US FEDERAL GOVERNMENT BUDGET DEFICIT(as a percent of nominal GDP)
Q1
Note: Shaded areas denote recessions according to the National Bureau of Economic Research.Source: Bureau of Economic Analysis.
yardeni.com
Figure 47.
Predicting Business Cycles
Page 24 / June 5, 2020 / Chapter 5 Charts: Predicting Business Cycles www.yardeni.com
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87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 225
10
15
20
25
5
10
15
20
25
Q1
Q1
US FEDERAL GOVERNMENT OUTLAYS(as a percent of nominal GDP)
Total(12-month sum)Federal Government Spending in GDP(saar)
Source: US Treasury Department and Bureau of Economic Analysis.
yardeni.com
Figure 48.
87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 2240
50
60
70
40
50
60
70
Apr
US FEDERAL GOVERNMENT OUTLAYS(as a percent of total outlays)
Health, Medicare,Income Security, Social Security
Source: US Treasury Department.
yardeni.com
Figure 49.
Predicting Business Cycles
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70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 225
10
15
20
25
30
35
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30
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Q4
DEBT OF FINANCIAL SECTORS(as a percent of total debt)
Source: Federal Reserve Board.
yardeni.com
Figure 50.
70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 240
100
200
300
400
0
100
200
300
400
Q4
US DEBT(as a percent of nominal GDP)
Debt/GDPTotalNonfinancialFinancial
Source: Federal Reserve Board Financial Accounts of the United States.
yardeni.com
Figure 51.
Predicting Business Cycles
Page 26 / June 5, 2020 / Chapter 5 Charts: Predicting Business Cycles www.yardeni.com
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48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24.2
4.7
9.2
13.7
18.2
22.727.2
.2
4.7
9.2
13.7
18.2
22.727.2
Q1GDP, GDI, & NATIONAL INCOME(trillion dollars, saar, ratio scale)
Gross Domestic Income*Gross Domestic Product
National Income
* GDI is Gross Domestic Income, which equals National Income plus Consumption of Fixed CapitalSource: Bureau of Economic Analysis.
yardeni.com
Figure 52.
-400
-200
0
200
400
-400
-200
0
200
400
Q1
48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24-3
-2
-1
0
1
2
3
-3
-2
-1
0
1
2
3
Q1
GDP LESS GDI: STATISTICAL DISCREPANCY*(billion dollars, saar)
(divided by GDP)
Source: Bureau of Economic Analysis.* GDI is Gross Domestic Income, which equals National Income plus Consumption of Fixed Capital.
yardeni.com
Figure 53.
Predicting Business Cycles
Page 27 / June 5, 2020 / Chapter 5 Charts: Predicting Business Cycles www.yardeni.com
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