Preliminary notes: What does it mean when GDS increases relative to GDP?

I showed this graph on 2 July:

Graph #1: Gross Domestic Spending as a Percent of Gross Domestic Product

It turned out that the raised area, in the 1970s and thereabouts,showed a fair similarity to the rate of inflation in those inflationary years.

Got me thinkin'

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GDP is Gross Domestic Product, the the sum of final spending in our economy in a year. GDS is Gross Domestic Spending, the total of final and non-final spending in our economy in a year. The increases in GDS are measured in dollar volume, not "number of transactions" or any such thing. It's a dollar number. So if GDS increases it is because spending increased, plain and simple. Same with GDP.

One major effect of a change in the GDS/GDP ratio would seem to be a change in spending pressures -- that is, inflation pressures.

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Whatever cause may lie behind the increase in spending, then, one fact remains: the spending increased. The trend of GDS/GDP, then, in the 1970s, was that costs increased faster than income: GDS increased faster than GDP.

If this is correct, I must be able to see it in business profits -- perhaps profits relative to GDP, certainly in profits relative to expenses.

I'll take that challenge.

Graph #2:Total Business Deductions Peak in 1982 as a Share of Gross Income

Yeah. It stands up to the challenge. Spending increased faster than revenue until 1982, and more slowly after that year.

If deductions rose till 1982 and then fell as a share of revenue, then profit must have done the opposite:

Graph #3: Business Profits hit bottom in 1982, Trending Upward Thereafter
That should come as no surprise.

Profits tended down until 1982, and up thereafter.