Predicting the Markets Chapter 2 Charts: Predicting the World

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1 Predicting the kets Chapter 2 Charts: April 2, 21 Dr. Edward Yardeni Chief Investment Strategist Mali Quintana Senior Economist info@yardenibook.com Please visit our sites at www. blog. thinking outside the box

2 Table Of Contents Table Of Contents 1-2 April 2, 21 / Chapter 2 Charts: www.

3 Figure 1. TOTAL IMPORTS OF 7 COUNTRIES 1/1929-3/1933 (billion dollars, monthly) T Note: T = Smoot-Hawley Tariff enacted June 17, 193. Source: League of Nations, Monthly Bulletin of Statistics, February 193, p Figure 2. US INDUSTRIAL PRODUCTION: (27=, monthly) T B M P Note: T = Smoot-Hawley Tariff enacted June 17, 193. B = Emergency Banking Act passed ch 9, M = k-to-market suspended June 193. P = Pearl Harbor attacked December 7, 191. Source: Federal Reserve Board. 3 Page 1 / April 2, 21 / Chapter 2 Charts: www.

4 Figure 3. US PRODUCER PRICES: (192=, monthly) Industrial Commodities Grains T B M P Note: T = Smoot-Hawley Tariff enacted June 17, 193. B = Emergency Banking Act passed ch 9, M = k-to-market suspended June 193. P = Pearl Harbor attacked December 7, 191. Source: Bureau of Labor Statistics Figure. US CONSUMER PRICE INDEX: (192-19=, monthly, nsa) T B P Note: T = Smoot-Hawley Tariff enacted June 17, 193. B = Emergency Banking Act passed ch 9, P = Pearl Harbor attacked December 7, 191. Source: Bureau of Labor Statistics. Page 2 / April 2, 21 / Chapter 2 Charts: www.

5 6 Figure. US COMMERCIAL BANK DEPOSITS: (billion dollars, annually) Source: Census Bureau. 2 Figure 6. DEPOSITS OF SUSPENDED US COMMERCIAL BANKS: (million dollars, monthly) Source: Federal Reserve Bulletin, September 1937, Table 13, p. 99. Page 3 / April 2, 21 / Chapter 2 Charts: www.

6 Figure 7. US UNEMPLOYMENT RATES: (percent, annual) Unemployment Rates Nonfarm Employees* Civilian Labor Force** * Persons 1 years old and older. ** Persons 16 years old and older. Source: Historical Statistics of the United States, Colonial times to 197. Figure. DOW JONES INDUSTRIALS AVERAGE (daily) 3 T B M P Note: T = Smoot-Hawley Tariff enacted June 17, 193. B = Emergency Banking Act passed ch 9, M = k-to-market suspended June 193. P = Pearl Harbor attacked December 7, 191. Source: Haver Analytics. Page / April 2, 21 / Chapter 2 Charts: www.

7 2 1 Figure 9. REAL GROSS DOMESTIC PRODUCT: ANNUALLY (billion 1996 dollars) Source: Historical Statistics of the United States. 2 Figure 1. REAL GROSS NATIONAL PRODUCT: QUARTERLY (billion 1939 dollars, saar) Source: National Bureau of Economic Research. Page / April 2, 21 / Chapter 2 Charts: www.

8 1 Figure 11. UNEMPLOYMENT RATE: (percent, sa) Note: Shaded areas denote recessions according to the National Bureau of Economic Research. Source: Bureau of Labor Statistics. 2 6 Figure 12. TOTAL NONFARM PAYROLLS: (millions, sa, ratio scale) Note: Shaded areas denote recessions according to the National Bureau of Economic Research. Source: Bureau of Labor Statistics. 2 Page 6 / April 2, 21 / Chapter 2 Charts: www.

9 Figure 13. S&P STOCK PRICE INDEX (ratio scale) Note: Shaded areas denote recessions according to the National Bureau of Economic Research. Source: Bureau of Labor Statistics Figure 1. INDUSTRIAL PRODUCTION (212=, ratio scale) Note: Shaded areas denote recessions according to the National Bureau of Economic Research. Source: Federal Reserve Board. Page 7 / April 2, 21 / Chapter 2 Charts: www.

10 7 6 Figure 1. CRB RAW INDUSTRIALS SPOT PRICE INDEX* (1967=, daily) C 7 6 / * Includes copper scrap, lead scrap, steel scrap, tin, zinc, burlap, cotton, print cloth, wool tops, hides, rosin, rubber, and tallow. Note: C = China joined World Trade Organization on December 11, 21. Source: Commodity Research Bureau Figure 16. BRENT CRUDE OIL PRICE (dollars per barrel, daily) C / Note: C = China joined World Trade Organization on December 11, 21. Source: Haver Analytics. Page / April 2, 21 / Chapter 2 Charts: www.

11 12 Figure 17. MSCI STOCK PRICE INDEXES (local currency) /2 7 6 /2 6 C 3 China 2 2 Emerging kets Note: C = China joined World Trade Organization during December 21. Source: MSCI Figure 1. CHINA: INDUSTRIAL PRODUCTION* (yearly percent change) C * Value added basis. Note: C = China joined World Trade Organization during December 21. Source: China National Bureau of Statistics. Page 9 / April 2, 21 / Chapter 2 Charts: www.

12 1. 1. Figure 19. CHINA: POPULATION (billions, ratio scale) Source: State Statistical Bureau of the People s Republic of China. 2 Figure 2. CHINA: POPULATION (1-year change, millions) year growth rate at annualized rate Source: State Statistical Bureau of the People s Republic of China. Page 1 / April 2, 21 / Chapter 2 Charts: www.

13 9 Figure 21. CHINA: RURAL & URBAN POPULATION* (as a percent of total population) Rural Urban O C * Estimates through 21, projections from 216 through 2. Note: O = China announced Open Door Policy during December 197. C = China joined World Trade Organization during December 21. Source: China National Bureau of Statistics Figure 22. CHINA: URBAN POPULATION (yearly change, millions) RURAL POPULATION Source: United Nations. Page 11 / April 2, 21 / Chapter 2 Charts: www.

14 Figure 23. EUROZONE: GOVERNMENT 1-YEAR BOND YIELDS (percent) D NIRP QE QEE Bond Yields France Germany Italy Spain Note: D (7/26/12) = ECB President io Draghi pledged to do "whatever it takes" to defend the euro. NIRP (6//21) = negative interest-rate policy. QE (1/22/1) = quantitative easing. QEE (3/1/16) = expansion and extension of QE with corporate bond purchases started 6/1/16. Source: Financial Times Figure 2. BRIC MSCI STOCK PRICE INDEX (in local currency, daily) C / Note: C = China joined World Trade Organization on December 11, 21. Source: MSCI. Page 12 / April 2, 21 / Chapter 2 Charts: www.

15 Figure 2. WORLD INDUSTRIAL PRODUCTION (EX CONSTRUCTION) (2=, swda*, ratio scale) Jan * Seasonally and working day adjusted. Source: CPB Netherlands Bureau for Economic Policy Analysis Figure 26. WORLD INDUSTRIAL PRODUCTION (EX CONSTRUCTION) (2=, swda*, ratio scale) Jan Industrial Production Advanced Economies Emerging Economies * Seasonally and working day adjusted. Source: CPB Netherlands Bureau for Economic Policy Analysis. Page 13 / April 2, 21 / Chapter 2 Charts: www.

16 1 1 Figure 27. OECD INDUSTRIAL PRODUCTION (19=, sa, ratio scale) Dec Source: OECD Figure 2. WORLD EXPORTS: VOLUME (2=, sa, ratio scale) Jan Source: CPB Netherlands Bureau for Economic Policy Analysis. 3 Page 1 / April 2, 21 / Chapter 2 Charts: www.

17 23 2 Figure 29. WORLD EXPORTS: VALUE (trillion dollars, annualized, nsa, ratio scale) Dec Source: IMF Figure 3. G7 EXPORTS (trillion dollars, saar, ratio scale) Feb Source: Haver Analytics. 2. Page 1 / April 2, 21 / Chapter 2 Charts: www.

18 6 Figure 31. INDUSTRIAL COMMODITY PRICES & WORLD EXPORTS 21 6 Dec 19 CRB Raw Industrials Spot Price Index* (1967=) /23 17 Value of World Exports (IMF) (trillion dollars, annualized, nsa) * Includes copper scrap, lead scrap, steel scrap, tin, zinc, burlap, cotton, print cloth, wool tops, hides, rosin, rubber, and tallow. Source: Commodity Research Bureau and IMF. 7 6 Figure 32. WORLD EXPORTS (VALUE): G7 vs REST OF WORLD (percent of total world exports using 12-month averages) Rest of World Dec G Dec Source: IMF and Haver Analytics. 2 Page 16 / April 2, 21 / Chapter 2 Charts: www.

19 7 6 Figure 33. PURCHASING MANAGERS INDEXES: GLOBAL (sa) Global PMIs Composite Manufacturing Non-Manufacturing Source: kit and Haver Analytics Figure 3. PURCHASING MANAGERS INDEXES: ADVANCED ECONOMIES Advanced Economies PMIs Composite Manufacturing Non-Manufacturing Source: kit and Haver Analytics. 9 Page 17 / April 2, 21 / Chapter 2 Charts: www.

20 7 6 Figure 3. PURCHASING MANAGERS INDEXES: EMERGING ECONOMIES Emerging Economies Composite Index Manufacturing Non-Manufacturing Source: kit and Haver Analytics Figure 36. OECD: LEADING INDICATORS* Feb * A reading above that is rising predicts expansion, above and falling a downturn, below and falling a slowdown, and below and rising a recovery. Source: Haver Analytics. Page 1 / April 2, 21 / Chapter 2 Charts: www.

21 13 Figure 37. OECD: LEADING INDICATORS* Feb US Europe Japan * A reading above that is rising predicts expansion, above and falling a downturn, below and falling a slowdown, and below and rising a recovery. Source: OECD and Haver Analytics. 16 Figure 3. BRICs: LEADING INDICATORS* 16 1 Feb Brazil China India Russia * A reading above that is rising predicts expansion, above and falling a downturn, below and falling a slowdown, and below and rising a recovery. Source: OECD and Haver Analytics. Page 19 / April 2, 21 / Chapter 2 Charts: www.

22 13 Figure 39. EUROZONE: ECONOMIC SENTIMENT INDICATOR* & REAL GDP Real GDP (yearly percent change) Economic Sentiment Indicator* (long-term average=, sa) * The overall economic sentiment indicator (ESI) is derived from the industrial (weight %), service (3%), consumer (2%), construction (%), and retail trade (%) confidence indicators. Source: Statistical Office of the European Communities, European Commission, and Haver Analytics Figure. EUROZONE: INDUSTRIAL PRODUCTION (21=, sa) Total Excluding Construction Manufacturing Feb Source: Statistical Office of European Communities. 7 Page 2 / April 2, 21 / Chapter 2 Charts: www.

23 Figure 1. EURO ZONE RETAIL SALES VOLUMES EXCLUDING AUTOS & MOTOR CYCLES (21=) Eurozone Germany France Italy Spain Source: Statistical Office of the European Communities. Feb Figure 2. GERMANY: IFO BUSINESS CLIMATE INDEX (2=, sa) Total Current Situation Index Expectations Index Source: Ifo Page 21 / April 2, 21 / Chapter 2 Charts: www.

24 12 11 Figure 3. JAPAN: INDUSTRIAL PRODUCTION (21=) Feb Source: Ministry of Economy, Trade & Industry Figure. MERCHANDISE EXPORTS (billions US dollars, saar) South Korea Taiwan Source: Haver Analytics Page 22 / April 2, 21 / Chapter 2 Charts: www.

25 19 Figure. CHINA: MERCHANDISE TRADE* (trillion yuan, saar, ratio scale) Total Exports Imports * Excluding Hong Kong. Source: China Customs and Haver Analytics Figure 6. CHINA: RAILWAYS FREIGHT TRAFFIC & IMPORTS PLUS EXPORTS Railways Freight Traffic ( million tons, nsa) Imports Plus Exports (billion yuan, saar) Source: China National Bureau of Statistics, China Customs, and Haver Analytics. Page 23 / April 2, 21 / Chapter 2 Charts: www.

26 2 Figure 7. US EXPORTS & IMPORTS OF GOODS & SERVICES IN NOMINAL GDP (as a percent of nominal GDP) 2 1 Q Goods & Services Imports Exports Source: Bureau of Economic Analysis. 3 Figure. WORLD EXPORTS VOLUME & US REAL MERCHANDISE EXPORTS + IMPORTS (yearly percent change) Feb Growth Rates (y/y) World Exports: Volume US Real Exports + Imports Source: CPB Netherlands Bureau for Economic Policy Analysis and Bureau of Economic Analysis. -3 Page 2 / April 2, 21 / Chapter 2 Charts: www.

27 Figure 9. JAPAN: LIVE BIRTHS & DEATHS (12-month sum, millions) Live Births Deaths Nov Source: Ministry of Health, Labor and Welfare. 1 Figure. US: REAL GDP (yearly percent change) Q Note: Shaded areas denote recessions according to the National Bureau of Economic Research. Source: Bureau of Economic Analysis. Page 2 / April 2, 21 / Chapter 2 Charts: www.

28 Figure 1. EUROZONE: PRIVATE SECTOR* LOANS OUTSTANDING AT MFIs** (trillion euros, sa) Total Private Sector Households (including non-profit institutions) Nonfinancial Corporations Others*** Feb * Total Private Sector includes Households (including non-profit institutions), Nonfinancial corporations, Other financial intermediaries, insurance corporations, and pension funds. ** Monetary Financial Institutions (MFIs) exclude Euro System of Central Banks (ESCB) and Money ket Funds (MMFs). *** Others include other financial intermediaries, insurance corporations, and pension funds. Source: Haver Analytics and ECB. 12 Figure 2. EUROZONE: INDUSTRIAL PRODUCTION EXCLUDING CONSTRUCTION Feb 9 Eurozone Germany France Italy Spain Source: Haver Analytics. 7 Page 26 / April 2, 21 / Chapter 2 Charts: www.

29 2 Figure 3. CHINA: REAL GDP 2 2 yearly percent change quarterly percent change, saar Q Source: China National Bureau of Statistics and Haver Analytics. Figure. 2 CHINA: BANK LOANS (trillions, nsa) 1 1 US dollars Yuan Source: People s Bank of China. Page 27 / April 2, 21 / Chapter 2 Charts: www.

30 12 1 Figure. CHINA: PRODUCER PRICE INDEX (yearly percent change) Source: China National Bureau of Statistics Figure 6. GLOBAL POPULATION: YOUNGER CHILDREN & OLDER ADULTS (as a percent of total population) Age Under 6 & Older Source: United Nations, 213. Page 2 / April 2, 21 / Chapter 2 Charts: www.

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