Stylized Facts

  1. Net Exports goes negative in 1973 and never recovers. One word: oil. Even the USD depreciation after the Plaza Accord (the one Martin Feldstein likes to pretend was inevitably going to happen then) can’t quite get it back to being positive. And once outsourcing industry to China hits full stride…
  2. Private Investment peaks in 2006. Dating the start of the current recession from December of 2007 still strikes me as being six months late.
  3. Consumption goes up fairly steadily from 1981, encompassing 8% more of total GDP—around a 12% increase over less than thirty years. Coincidentally, the Reagan Revolution moves taxes more heavily onto consumers at the same time. (Note that only about half of the appreciation in consumption is reflected in the change in Net Exports.)
  4. Government spending declines starting around 1991, when the Real George (H.W.) Bush breaks his “no nude Texans” pledge. The era of Big Government remains over until George “Dad’s Rolodex Got Me Another Job I Can Screw Up” (W.) Bush desperately needed people to be employed:

Those are my top-of-the-head ones. What are yours?

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