Saturday, September 10, 2016

Putting numbers on vigor (3.5: That doesn't look like vigor)

Here's a close-up of that last graph from yesterday.

Graph #1: Household Debt (blue)and Trends since 2010 (dotted) and 2013 (black)
Looking at the path of household debt after the crisis. The dotted line is based on debt data from the start of the red line to the end of the green line: data since 2010. The solid black line  is based on data shown in green: data since 2013.

Just to be clear, the dotted line uses all the data that the solid black line uses, plus some earlier data. And the dotted line goes up faster.

In the years of prediction, after the green line ends, the dotted line goes up faster than the solid. The trend based on 2010-2016 goes up faster than the trend based on 2013-2016. It looks to me like the change was more rapid in the early years, less rapid in the later years. There was more vigor in the 2010-2013 decline than in the 2013-2016 increase.

It looks to me also that the increase in household debt is not as rapid as the decline in household debt service suggests:

Graph #7: Household Debt Service and the 2014-2015 Trend
But even with debt service, I now see that the 2008-2012 decline was more rapid than the the trend based on the last two years. The changes are slower now, at the bottom, than they were during the decline. Unfortunately, this is the time we should start to see increase. If the changes are slow during the time of increase, that doesn't bode well for vigor.

I do still think people are tired of this tired economy. People are ready for a better economy. And once people feel better about things, after the election maybe, household borrowing and economic vigor will rise.

// the Excel file

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