ECONREVIEWS

Thursday, August 31, 2017

S&P/Case-Shiller MSA Home Price Index (Seasonal Adjusted) (1987/01/01=1.00) as of 6/2017

The following charts display the S&P/Case-Shiller MSA Home price Index (1987/01/01 =1.00) of several cities in the United States as of June, 2017. The home prices in many cities recover from the bottom caused by the financial crisis in 2007.

If you have purchased a home with $100K in the following cities in January 1987, then the value of house would be as of June 2017

San Fransco (506 K) > Los Angeles (439K ) > San Diego (438 K) > Denver (392K) > DC (341K) > Miami (327K)> Boston (284K) > Chicago (255K) > New York(254K) > Las Vegas (243K)

Source: http://us.spindices.com/index-family/real-estate/sp-corelogic-case-shiller

Tuesday, August 29, 2017

Ratios of U.S. corporate profits by industry

Correlation Matrix

The following chart shows the correlation matrix of ratios of profits by industry in total domestic profit.

The finance industry is positively correlated with retail industry and is negatively correlated with other industries.

The manufacturing industry is positively correlated with transportation and wholesale industries and is negatively correlated with retail.

The transportation industry is positively correlated with the manufacturing industry.

The information industry is positively correlated with the transportation industry.

The following chart shows the historical ratios of profits by industry in total U.S. corporate profits.

The following chart shows the ratio of finance industry (excluding the Fed) in all industry (excluding the profits from rest of world)

The following chart shows the ratio of manufacturing industry in all industry (excluding the profits from rest of world)

Monday, August 28, 2017

Corporate profits with inventory valuation and capital consumption adjustments: Rest of the world

The following chart shows the relationship between movements of dollar and U.S. corporate profits from rest of the world. They move opposite direction.

The profits of U.S. corporates from rest of the world had been increasing tremendously, but staying flat lately.

However, the growth rates of U.S. corporate profits from rest of the world had been slow down. It actually decreased from 2014 to 2016 when the Fed began to tighten the monetary policy.

The following chart shows the portion of U.S. corporate profits from rest of world in total U.S. corporate profits and it is growing which indicates the profits of U.S. corporates depend on more other countries.

Source: https://fred.stlouisfed.org/series/B394RC1Q027SBEA

Wednesday, August 23, 2017

Average Hourly Earnings of All employees

Six reasons why Average Houring Earnings are not rising fast

1. Boomers and Millennials - Higher-paid baby boomers are retiring and being replaced by younger and less experienced workers who start at lower salaries

2. Global labor market creates price controls - Americans are directly or indirectly competing in a worldwide pool of workers like never before.

3. "Price" Control -Not government-mandated controls, Stiff global competition caps U.S. wages by preventing companies from raising prices to cover higher labor costs

4.Technology progress - Technological advances have spawned a new revolution in business models that dramatically lower costs, including the price of labor

5.Recession scars -The great recession of 2007-2009 made Americans less secure and more fearful of losing their jobs, leading them to move around less frequently and be less aggressive in seeking higher pay.

6.Low productivity - productivity has been unusually weak. it grew an average of 1.1% from 20077 to 2016.

Annual Changes from same period in previous year