Rules, Discretionary Authorities and Slow Productivity Growth, Twenty Nine Million Unemployed or Underemployed, Stagnating Wages and Real Disposable Income per Capita, United States International Trade, World Cyclical Slow Growth and Global Recession Risk: Part IV

 

Rules, Discretionary Authorities and Slow Productivity Growth, Twenty Nine Million Unemployed or Underemployed, Stagnating Wages and Real Disposable Income per Capita, United States International Trade, World Cyclical Slow Growth and Global Recession Risk

Carlos M. Pelaez

© Carlos M. Pelaez, 2009, 2010, 2011, 2012, 2013, 2014

Executive Summary

I Twenty Nine Million Unemployed or Underemployed

IA1 Summary of the Employment Situation

IA2 Number of People in Job Stress

IA3 Long-term and Cyclical Comparison of Employment

IA4 Job Creation

IB Stagnating Real Wages

IC Stagnating Real Disposable Income and Consumption Expenditures

IB1 Stagnating Real Disposable Income and Consumption Expenditures

IB2 Financial Repression

II Rules, Discretionary Authorities and Slow Productivity Growth

IIA United States International Trade

III World Financial Turbulence

IIIA Financial Risks

IIIE Appendix Euro Zone Survival Risk

IIIF Appendix on Sovereign Bond Valuation

IV Global Inflation

V World Economic Slowdown

VA United States

VB Japan

VC China

VD Euro Area

VE Germany

VF France

VG Italy

VH United Kingdom

VI Valuation of Risk Financial Assets

VII Economic Indicators

VIII Interest Rates

IX Conclusion

References

Appendixes

Appendix I The Great Inflation

IIIB Appendix on Safe Haven Currencies

IIIC Appendix on Fiscal Compact

IIID Appendix on European Central Bank Large Scale Lender of Last Resort

IIIG Appendix on Deficit Financing of Growth and the Debt Crisis

IIIGA Monetary Policy with Deficit Financing of Economic Growth

IIIGB Adjustment during the Debt Crisis of the 1980s

V World Economic Slowdown. Table V-1 is constructed with the database of the IMF (http://www.imf.org/external/pubs/ft/weo/2013/02/weodata/index.aspx) to show GDP in dollars in 2012 and the growth rate of real GDP of the world and selected regional countries from 2013 to 2016. The data illustrate the concept often repeated of “two-speed recovery” of the world economy from the recession of 2007 to 2009. The IMF has lowered its forecast of the world economy to 2.9 percent in 2013 but accelerating to 3.6 percent in 2014, 4.0 percent in 2015 and 4.1 percent in 2016. Slow-speed recovery occurs in the “major advanced economies” of the G7 that account for $34,560 billion of world output of $72,216 billion, or 47.9 percent, but are projected to grow at much lower rates than world output, 2.1 percent on average from 2013 to 2016 in contrast with 3.6 percent for the world as a whole. While the world would grow 15.4 percent in the four years from 2013 to 2016, the G7 as a whole would grow 8.6 percent. The difference in dollars of 2012 is rather high: growing by 15.4 percent would add $11.1 trillion of output to the world economy, or roughly, two times the output of the economy of Japan of $5,960 billion but growing by 8.6 percent would add $6.2 trillion of output to the world, or about the output of Japan in 2012. The “two speed” concept is in reference to the growth of the 150 countries labeled as emerging and developing economies (EMDE) with joint output in 2012 of $27,221 billion, or 37.7 percent of world output. The EMDEs would grow cumulatively 21.9 percent or at the average yearly rate of 5.1 percent, contributing $6.0 trillion from 2013 to 2016 or the equivalent of somewhat less than the GDP of $8,221 billion of China in 2012. The final four countries in Table V-1 often referred as BRIC (Brazil, Russia, India, China), are large, rapidly growing emerging economies. Their combined output in 2012 adds to $14,346 billion, or 19.9 percent of world output, which is equivalent to 41.5 percent of the combined output of the major advanced economies of the G7.

Table V-1, IMF World Economic Outlook Database Projections of Real GDP Growth

	GDP USD 2012	Real GDP ∆% 2013	Real GDP ∆% 2014	Real GDP ∆% 2015	Real GDP ∆% 2016
World	72,216	2.9	3.6	4.0	4.1
G7	34,560	1.2	2.0	2.5	2.6
Canada	1,821	1.6	2.2	2.4	2.5
France	2,614	0.2	1.0	1.5	1.7
DE	3,430	0.5	1.4	1.4	1.3
Italy	2,014	-1.8	0.7	1.1	1.4
Japan	5,960	1.9	1.2	1.1	1.2
UK	2,477	1.4	1.9	2.0	2.0
US	16,245	1.6	2.6	3.4	3.5
Euro Area	12,199	-0.4	1.0	1.4	1.5
DE	3,430	0.5	1.4	1.4	1.3
France	2,614	0.2	1.0	1.5	1.7
Italy	2,014	-1.8	0.7	1.1	1.4
POT	212	-1.8	0.8	1.5	1.8
Ireland	211	0.6	1.8	2.5	2.5
Greece	249	-4.2	0.6	2.9	3.7
Spain	1,324	-1.3	0.2	0.5	0.7
EMDE	27,221	4.5	5.1	5.3	5.4
Brazil	2,253	2.5	2.5	3.2	3.3
Russia	2,030	1.5	3.0	3.5	3.5
India	1,842	3.8	5.1	6.3	6.5
China	8,221	7.6	7.3	7.0	7.0

Notes; DE: Germany; EMDE: Emerging and Developing Economies (150 countries); POT: Portugal

Source: IMF World Economic Outlook databank http://www.imf.org/external/pubs/ft/weo/2013/02/weodata/index.aspx

Continuing high rates of unemployment in advanced economies constitute another characteristic of the database of the WEO (http://www.imf.org/external/pubs/ft/weo/2013/02/weodata/index.aspx). Table V-2 is constructed with the WEO database to provide rates of unemployment from 2012 to 2016 for major countries and regions. In fact, unemployment rates for 2012 in Table V-2 are high for all countries: unusually high for countries with high rates most of the time and unusually high for countries with low rates most of the time. The rates of unemployment are particularly high for the countries with sovereign debt difficulties in Europe: 15.7 percent for Portugal (POT), 14.7 percent for Ireland, 24.2 percent for Greece, 25.0 percent for Spain and 10.6 percent for Italy, which is lower but still high. The G7 rate of unemployment is 7.4 percent. Unemployment rates are not likely to decrease substantially if slow growth persists in advanced economies.

Table V-2, IMF World Economic Outlook Database Projections of Unemployment Rate as Percent of Labor Force

	% Labor Force 2012	% Labor Force 2013	% Labor Force 2014	% Labor Force 2015	% Labor Force 2016
World	NA	NA	NA	NA	NA
G7	7.4	7.3	7.3	7.0	6.6
Canada	7.3	7.2	7.1	7.0	6.9
France	10.3	11.0	11.1	10.9	10.5
DE	5.5	5.6	5.5	5.5	5.5
Italy	10.7	12.5	12.4	12.0	11.2
Japan	4.4	4.2	4.3	4.3	4.3
UK	8.0	7.7	7.5	7.3	7.0
US	8.1	7.6	7.4	6.9	6.4
Euro Area	11.4	12.3	12.2	12.0	11.5
DE	5.5	5.6	5.5	5.5	5.5
France	10.3	11.0	11.1	10.9	10.5
Italy	10.7	12.5	12.4	12.0	11.2
POT	15.7	17.4	17.7	17.3	16.8
Ireland	14.7	13.7	13.3	12.8	12.4
Greece	24.2	27.0	26.1	24.0	21.0
Spain	25.0	26.9	26.7	26.5	26.2
EMDE	NA	NA	NA	NA	NA
Brazil	5.5	5.8	6.0	6.5	6.5
Russia	6.0	5.7	5.7	5.5	5.5
India	NA	NA	NA	NA	NA
China	4.1	4.1	4.1	4.1	4.1

Notes; DE: Germany; EMDE: Emerging and Developing Economies (150 countries)

Source: IMF World Economic Outlook databank http://www.imf.org/external/pubs/ft/weo/2013/02/weodata/index.aspx

Table V-3 provides the latest available estimates of GDP for the regions and countries followed in this blog from IQ2012 to IIQ2013 available now for all countries. There are preliminary estimates for all countries for IVQ2013. Growth is weak throughout most of the world.

• Japan. The GDP of Japan increased 0.9 percent in IQ2012 and 3.2 percent relative to a year earlier but part of the jump could be the low level a year earlier because of the Tōhoku or Great East Earthquake and Tsunami of Mar 11, 2011. Japan is experiencing difficulties with the overvalued yen because of worldwide capital flight originating in zero interest rates with risk aversion in an environment of softer growth of world trade. Japan’s GDP fell 0.4 percent in IIQ2012 at the seasonally adjusted annual rate (SAAR) of minus 1.7 percent, which is much lower than 3.7 percent in IQ2012. Growth of 3.2 percent in IIQ2012 in Japan relative to IIQ2011 has effects of the low level of output because of Tōhoku or Great East Earthquake and Tsunami of Mar 11, 2011. Japan’s GDP contracted 0.8 percent in IIIQ2012 at the SAAR of minus 3.1 percent and decreased 0.2 percent relative to a year earlier. Japan’s GDP contracted percent in IVQ2012 at the SAAR of minus 0.2 percent and decreased 0.3 percent relative to a year earlier. Japan grew 1.2 percent in IQ2013 at the SAAR of 4.0 percent and changed 0.0 percent relative to a year earlier. Japan’s GDP increased 1.0 percent in IIQ2013 at the SAAR of 3.9 percent and increased 1.2 percent relative to a year earlier. Japan’s GDP grew 0.3 percent in IIIQ2013 at the SAAR of 1.1 percent and increased 2.3 percent relative to a year earlier. In IVQ2013, Japan’s GDP increased 0.3 percent at the SAAR of 1.0 percent, increasing 2.7 percent relative to a year earlier.
• China. The GDP of China grew at 2.1 percent in IIQ2012, which annualizes to 8.7 percent and 7.6 percent relative to a year earlier. China grew at 2.0 percent in IIIQ2012, which annualizes at 8.2 percent and 7.4 percent relative to a year earlier. In IVQ2012, China grew at 1.9 percent, which annualizes at 7.8 percent, and 7.9 percent in IVQ2012 relative to IVQ2011. In IQ2013, China grew at 1.5 percent, which annualizes at 6.1 percent and 7.7 percent relative to a year earlier. In IIQ2013, China grew at 1.8 percent, which annualizes at 7.4 percent and 7.5 percent relative to a year earlier. China grew at 2.2 percent in IIIQ2013, which annualizes at 9.1 percent and 7.8 percent relative to a year earlier. China grew at 1.8 percent in IVQ2013, which annualized to 7.4 percent and 7.7 percent relative to a year earlier. There is decennial change in leadership in China (http://www.xinhuanet.com/english/special/18cpcnc/index.htm). Growth rates of GDP of China in a quarter relative to the same quarter a year earlier have been declining from 2011 to 2013.
• Euro Area. GDP fell 0.1 percent in the euro area in IQ2012 and decreased 0.2 in IQ2012 relative to a year earlier. Euro area GDP contracted 0.3 percent IIQ2012 and fell 0.5 percent relative to a year earlier. In IIIQ2012, euro area GDP fell 0.2 percent and declined 0.7 percent relative to a year earlier. In IVQ2012, euro area GDP fell 0.5 percent relative to the prior quarter and fell 1.0 percent relative to a year earlier. In IQ2013, the GDP of the euro area fell 0.2 percent and decreased 1.2 percent relative to a year earlier. The GDP of the euro area increased 0.3 percent in IIQ2013 and fell 0.6 percent relative to a year earlier. In IIIQ2013, euro area GDP increased 0.1 percent and fell 0.3 percent relative to a year earlier. The GDP of the euro area increased 0.3 percent in IVQ2013 and increased 0.5 percent relative to a year earlier.
• Germany. The GDP of Germany increased 0.7 percent in IQ2012 and 1.8 percent relative to a year earlier. In IIQ2012, Germany’s GDP decreased 0.1 percent and increased 0.6 percent relative to a year earlier but 1.1 percent relative to a year earlier when adjusted for calendar (CA) effects. In IIIQ2012, Germany’s GDP increased 0.2 percent and 0.4 percent relative to a year earlier. Germany’s GDP contracted 0.5 percent in IVQ2012 and increased 0.0 percent relative to a year earlier. In IQ2013, Germany’s GDP increased 0.0 percent and fell 1.6 percent relative to a year earlier. In IIQ2013, Germany’s GDP increased 0.7 percent and 0.9 percent relative to a year earlier. The GDP of Germany increased 0.3 percent in IIIQ2013 and 1.1 percent relative to a year earlier. In IVQ2013, Germany’s GDP increased 0.4 percent and 1.3 percent relative to a year earlier.
• United States. Growth of US GDP in IQ2012 was 0.9 percent, at SAAR of 3.7 percent and higher by 3.3 percent relative to IQ2011. US GDP increased 0.3 percent in IIQ2012, 1.2 percent at SAAR and 2.8 percent relative to a year earlier. In IIIQ2012, US GDP grew 0.7 percent, 2.8 percent at SAAR and 3.1 percent relative to IIIQ2011. In IVQ2012, US GDP grew 0.0 percent, 0.1 percent at SAAR and 2.0 percent relative to IVQ2011. In IQ2013, US GDP grew at 1.1 percent SAAR, 0.3 percent relative to the prior quarter and 1.3 percent relative to the same quarter in 2013. In IIQ2013, US GDP grew at 2.5 percent in SAAR, 0.6 percent relative to the prior quarter and 1.6 percent relative to IIQ2012. US GDP grew at 4.1 percent in SAAR in IIIQ2013, 1.0 percent relative to the prior quarter and 2.0 percent relative to the same quarter a year earlier (http://cmpassocregulationblog.blogspot.com/2014/03/financial-risks-slow-cyclical-united.html and earlier http://cmpassocregulationblog.blogspot.com/2014/02/mediocre-cyclical-united-states.html) with weak hiring (http://cmpassocregulationblog.blogspot.com/2014/02/theory-and-reality-of-cyclical-slow.htmland earlier http://cmpassocregulationblog.blogspot.com/2014/01/capital-flows-exchange-rates-and.html). In IVQ2013, US GDP grew 0.6 percent at 2.4 percent SAAR and 2.5 percent relative to a year earlier.
• United Kingdom. In IQ2012, UK GDP changed 0.0 percent, increasing 0.6 percent relative to a year earlier. UK GDP fell 0.4 percent in IIQ2012 and changed 0.0 percent relative to a year earlier. UK GDP increased 0.8 percent in IIIQ2012 and increased 0.2 percent relative to a year earlier. UK GDP fell 0.1 percent in IVQ2012 relative to IIIQ2012 and increased 0.2 percent relative to a year earlier. UK GDP increased 0.4 percent in IQ2013 and 0.6 percent relative to a year earlier. UK GDP increased 0.7 percent in IIQ2013 and 1.8 percent relative to a year earlier. In IIIQ2013, UK GDP increased 0.8 percent and 1.9 percent relative to a year earlier. UK GDP increased 0.7 percent in IVQ2013 and 2.7 percent relative to a year earlier.
• Italy. Italy has experienced decline of GDP in nine consecutive quarters from IIIQ2011 to IIIQ2013. Italy’s GDP fell 1.1 percent in IQ2012 and declined 1.7 percent relative to IQ2011. Italy’s GDP fell 0.6 percent in IIQ2012 and declined 2.6 percent relative to a year earlier. In IIIQ2012, Italy’s GDP fell 0.4 percent and declined 2.8 percent relative to a year earlier. The GDP of Italy contracted 0.9 percent in IVQ2012 and fell 3.0 percent relative to a year earlier. In IQ2013, Italy’s GDP contracted 0.6 percent and fell 2.6 percent relative to a year earlier. Italy’s GDP fell 0.3 percent in IIQ2013 and 2.3 percent relative to a year earlier. The GDP of Italy changed 0.0 percent in IIIQ2013 and declined 1.9 percent relative to a year earlier. Italy’s GDP increased 0.1 percent in IVQ2013 and decreased 0.8 percent relative to a year earlier.
• France. France’s GDP changed 0.0 percent in IQ2012 and increased 0.4 percent relative to a year earlier. France’s GDP decreased 0.3 percent in IIQ2012 and increased 0.1 percent relative to a year earlier. In IIIQ2012, France’s GDP increased 0.2 percent and changed 0.0 percent relative to a year earlier. France’s GDP fell 0.2 percent in IVQ2012 and declined 0.3 percent relative to a year earlier. In IQ2013, France GDP changed 0.0 percent and declined 0.4 percent relative to a year earlier. The GDP of France increased 0.6 percent in IIQ2013 and 0.5 percent relative to a year earlier. France’s GDP changed 0.0 percent in IIIQ2013 and increased 0.3 percent relative to a year earlier. The GDP of France increased 0.3 percent in IVQ2013 and 0.8 percent relative to a year earlier.

Table V-3, Percentage Changes of GDP Quarter on Prior Quarter and on Same Quarter Year Earlier, ∆%

	IQ2012/IVQ2011	IQ2012/IQ2011
United States	QOQ: 0.9        SAAR: 3.7	3.3
Japan	QOQ: 0.9 SAAR: 3.7	3.2
China	1.4	8.1
Euro Area	-0.1	-0.2
Germany	0.7	1.8
France	0.0	0.4
Italy	-1.1	-1.7
United Kingdom	0.0	0.6
	IIQ2012/IQ2012	IIQ2012/IIQ2011
United States	QOQ: 0.3         SAAR: 1.2	2.8
Japan	QOQ: -0.4 SAAR: -1.7	3.2
China	2.1	7.6
Euro Area	-0.3	-0.5
Germany	-0.1	0.6 1.1 CA
France	-0.3	0.1
Italy	-0.6	-2.6
United Kingdom	-0.4	0.0
	IIIQ2012/ IIQ2012	IIIQ2012/ IIIQ2011
United States	QOQ: 0.7  SAAR: 2.8	3.1
Japan	QOQ: –0.8 SAAR: –3.1	-0.2
China	2.0	7.4
Euro Area	-0.2	-0.7
Germany	0.2	0.4
France	0.2	0.0
Italy	-0.4	-2.8
United Kingdom	0.8	0.2
	IVQ2012/IIIQ2012	IVQ2012/IVQ2011
United States	QOQ: 0.0 SAAR: 0.1	2.0
Japan	QOQ: -0.1 SAAR: -0.2	-0.3
China	1.9	7.9
Euro Area	-0.5	-1.0
Germany	-0.5	0.0
France	-0.2	-0.3
Italy	-0.9	-3.0
United Kingdom	-0.1	0.2
	IQ2013/IVQ2012	IQ2013/IQ2012
United States	QOQ: 0.3 SAAR: 1.1	1.3
Japan	QOQ: 1.2 SAAR: 4.8	0.0
China	1.5	7.7
Euro Area	-0.2	-1.2
Germany	0.0	-1.6
France	0.0	-0.4
Italy	-0.6	-2.6
UK	0.4	0.6
	IIQ2013/IQ2013	IIQ2013/IIQ2012
United States	QOQ: 0.6 SAAR: 2.5	1.6
Japan	QOQ: 1.0 SAAR: 3.9	1.2
China	1.8	7.5
Euro Area	0.3	-0.6
Germany	0.7	0.9
France	0.6	0.5
Italy	-0.3	-2.3
UK	0.7	1.8
	IIIQ2013/IIQ2013	III/Q2013/  IIIQ2012
USA	QOQ: 1.0 SAAR: 4.1	2.0
Japan	QOQ: 0.3 SAAR: 1.1	2.3
China	2.2	7.8
Euro Area	0.1	-0.3
Germany	0.3	1.1
France	0.0	0.3
Italy	0.0	-1.9
UK	0.8	1.9
	IVQ2013/IIIQ2013	IVQ2013/IVQ2012
USA	QOQ: 0.6 SAAR: 2.4	2.5
Japan	QOQ: 0.3 SAAR: 1.0	2.7
China	1.8	7.7
Euro Area	0.3	0.5
Germany	0.4	1.3
France	0.3	0.8
Italy	0.1	-0.8
UK	0.7	2.7

QOQ: Quarter relative to prior quarter; SAAR: seasonally adjusted annual rate

Source: Country Statistical Agencies http://www.census.gov/aboutus/stat_int.html

Table V-4 provides two types of data: growth of exports and imports in the latest available months and in the past 12 months; and contributions of net trade (exports less imports) to growth of real GDP.

• Japan. Japan provides the most worrisome data (http://cmpassocregulationblog.blogspot.com/2014/03/financial-risks-slow-cyclical-united.html and earlier http://cmpassocregulationblog.blogspot.com/2014/02/mediocre-cyclical-united-states.html and earlier http://cmpassocregulationblog.blogspot.com/2013/12/tapering-quantitative-easing-mediocre.html and earlier http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-zero-interest-rates-world.html http://cmpassocregulationblog.blogspot.com/2013/11/global-financial-risk-world-inflation.html http://cmpassocregulationblog.blogspot.com/2013/09/duration-dumping-and-peaking-valuations_8763.html http://cmpass ocregulationblog.blogspot.com/2013/08/interest-rate-risks-duration-dumping.html and earlier http://cmpassocregulationblog.blogspot.com/2013/07/duration-dumping-steepening-yield-curve.html and earlier http://cmpassocregulationblog.blogspot.com/2013/06/paring-quantitative-easing-policy-and_4699.html and earlier at http://cmpassocregulationblog.blogspot.com/2013/05/united-states-commercial-banks-assets.html and earlier http://cmpassocregulationblog.blogspot.com/2013/04/world-inflation-waves-squeeze-of.html and earlier http://cmpassocregulationblog.blogspot.com/2013/03/united-states-commercial-banks-assets.html and earlier at http://cmpassocregulationblog.blogspot.com/2013/02/world-inflation-waves-united-states.html and earlier at http://cmpassocregulationblog.blogspot.com/2013/02/thirty-one-million-unemployed-or.html and earlier http://cmpassocregulationblog.blogspot.com/2012/12/mediocre-and-decelerating-united-states_24.html and earlier http://cmpassocregulationblog.blogspot.com/2012/11/contraction-of-united-states-real_25.html and for GDP http://cmpassocregulationblog.blogspot.com/2013/09/recovery-without-hiring-ten-million.html and earlier http://cmpassocregulationblog.blogspot.com/2013/08/duration-dumping-and-peaking-valuations.html and earlier http://cmpassocreulationblog.blogspot.com/2013/02/recovery-without-hiring-united-states.html). In Jan 2014, Japan’s exports grew 9.5 percent in 12 months while imports increased 25.0 percent. The second part of Table V-4 shows that net trade deducted 1.3 percentage points from Japan’s growth of GDP in IIQ2012, deducted 2.2 percentage points from GDP growth in IIIQ2012 and deducted 0.5 percentage points from GDP growth in IVQ2012. Net trade added 0.4 percentage points to GDP growth in IQ2012, 1.7 percentage points in IQ2013 and 0.5 percentage points in IIQ2013. In IIIQ2013, net trade deducted 2.0 percentage points from GDP growth in Japan. Net trade ducted 2.2 percentage points from GDP growth in Japan in IVQ2013.
• China. In Jan 2014, China exports increased 10.6 percent relative to a year earlier and imports increased 10.0 percent.
• Germany. Germany’s exports decreased 0.9 percent in the month of Dec 2013 and increased 4.6 percent in the 12 months ending in Dec 2013. Germany’s imports decreased 0.6 percent in the month of Dec and increased 2.0 percent in the 12 months ending in Dec. Net trade contributed 0.8 percentage points to growth of GDP in IQ2012, contributed 0.4 percentage points in IIQ2012, contributed 0.3 percentage points in IIIQ2012, deducted 0.5 percentage points in IVQ2012, deducted 0.3 percentage points in IQ2013 and added 0.3 percentage points in IIQ2013. Net traded deducted 0.3 percentage points from Germany’s GDP growth in IIIQ2013 and added 1.1 percentage points to GDP growth in IVQ2013.
• United Kingdom. Net trade deducted 0.8 percentage points from UK value added in IQ2012, deducted 0.8 percentage points in IIQ2012, added 0.7 percentage points in IIIQ2012 and subtracted 0.5 percentage points in IVQ2012. In IQ2013, net trade added 0.8 percentage points to UK’s growth of value added and contributed 0.0 percentage points in IIQ2013. In IIIQ2013, net trade deducted 1.1 percentage points from UK growth. Net trade contributed 0.4 percentage points to UK value added in IVQ2013.
• France. France’s exports decreased 1.8 percent in Jan 2013 while imports decreased 0.3 percent. Net traded added 0.1 percentage points to France’s GDP in IIIQ2012 and 0.1 percentage points in IVQ2012. Net trade deducted 0.1 percentage points from France’s GDP growth in IQ2013 and added 0.2 percentage points in IIQ2013, deducting 0.7 percentage points in IIIQ2013. Net trade added 0.2 percentage points to France’s GDP in IVQ2013.
• United States. US exports decreased 1.8 percent in Dec 2013 and goods exports increased 2.1 percent in Jan-Dec 2013 relative to a year earlier but net trade deducted 0.03 percentage points from GDP growth in IIIQ2012 and added 0.68 percentage points in IVQ2012. Net trade deducted 0.28 percentage points from US GDP growth in IQ2013 and deducted 0.07 percentage points in IIQ2013. Net traded added 0.14 percentage points to US GDP growth in IIIQ2013. Net trade added 0.99 percentage points to US GDP growth in IVQ2013. Industrial production decreased 0.3 percent in Jan 2014 after increasing 0.3 percent in Dec 2013 and increasing 0.7 percent in Nov 2013, with all data seasonally adjusted. The report of the Board of Governors of the Federal Reserve System states (http://www.federalreserve.gov/releases/g17/Current/default.htm):

“Industrial production decreased 0.3 percent in January after having risen 0.3 percent in December. In January, manufacturing output fell 0.8 percent, partly because of the severe weather that curtailed production in some regions of the country. Additionally, manufacturing production is now reported to have been lower in the fourth quarter; the index is now estimated to have advanced at an annual rate of 4.6 percent in the fourth quarter rather than 6.2 percent. The output of utilities rose 4.1 percent in January, as demand for heating was boosted by unseasonably cold temperatures. The production at mines declined 0.9 percent following a gain of 1.8 percent in December. At 101.0 percent of its 2007 average, total industrial production in January was 2.9 percent above its level of a year earlier. The capacity utilization rate for total industry decreased in January to 78.5 percent, a rate that is 1.6 percentage points below its long-run (1972–2013) average.”

In the six months ending in Jan 2014, United States national industrial production accumulated increase of 2.1 percent at the annual equivalent rate of 4.3 percent, which is higher than growth of 2.9 percent in the 12 months ending in Jan 2014. Excluding growth of -0.3 percent in Jan 2014, growth in the remaining five months from Aug to Dec 2013 accumulated to 2.4 percent or 5.9 percent annual equivalent. Industrial production fell in one of the past six months. Business equipment accumulated growth of 0.6 percent in the six months from Aug 2013 to Jan 2014 at the annual equivalent rate of 1.2 percent, which is lower than growth of 2.4 percent in the 12 months ending in Jan 2014. The Fed analyzes capacity utilization of total industry in its report (http://www.federalreserve.gov/releases/g17/Current/default.htm): “The capacity utilization rate for total industry decreased in January to 78.5 percent, a rate that is 1.6 percentage points below its long-run (1972–2013) average.” United States industry apparently decelerated to a lower growth rate with possible acceleration in the past few months.

Manufacturing decreased 0.8 percent in Jan 2014 after increasing 0.3 percent in Dec 2013 and increasing 0.3 percent in Nov 2013 seasonally adjusted, increasing 1.3 percent not seasonally adjusted in 12 months ending in Jan 2014. Manufacturing grew cumulatively 1.2 percent in the six months ending in Jan 2014 or at the annual equivalent rate of 2.4 percent. Excluding the decrease of 0.3 percent in Jan 2014, manufacturing accumulated growth of 2.0 percent from Aug 2013 to Dec 2013 or at the annual equivalent rate of 4.9 percent. There has been evident deceleration of manufacturing growth in the US from 2010 and the first three months of 2011 into more recent months as shown by 12 months rates of growth. Growth rates appeared to be increasing again closer to 5 percent in Apr-Jun 2012 but deteriorated. The rates of decline of manufacturing in 2009 are quite high with a drop of 18.2 percent in the 12 months ending in Apr 2009. Manufacturing recovered from this decline and led the recovery from the recession. Rates of growth appeared to be returning to the levels at 3 percent or higher in the annual rates before the recession but the pace of manufacturing fell steadily in the past six months with some strength at the margin. Manufacturing increased 21.9 from the peak in Jun 2007 to the trough in Apr 2009 and increased by 19.1 percent from the trough in Apr 2009 to Dec 2013. Manufacturing grew 17.2 percent from the trough in Apr 2009 to Jan 2014. Manufacturing output in Jan 2013 is 8.5 percent below the peak in Jun 2007.

Table V-4, Growth of Trade and Contributions of Net Trade to GDP Growth, ∆% and % Points

	Exports M ∆%	Exports 12 M ∆%	Imports M ∆%	Imports 12 M ∆%
USA	0.6 Jan	3.3 Jan	0.6 Jan	-0.3 Jan
Japan		Jan 2014 9.5 Dec 2013 15.3 Nov 2013 18.4 Oct 2013 18.6 Sep 2013 11.5 Aug 2013 14.7 Jul 2013 12.2 Jun 2013 7.4 May 2013 10.1 Apr 2013 3.8 Mar 2013 1.1 Feb 2013 -2.9 Jan 2013 6.4 Dec -5.8 Nov -4.1 Oct -6.5 Sep -10.3 Aug -5.8 Jul -8.1		Jan 2014 25.0 Dec 2013 24.7 Nov 2013 21.1 Oct 2013 26.1 Sep 2013 16.5 Aug 2013 16.0 Jul 2013 19.6 Jun 2013 11.8 May 2013 10.0 Apr 2013 9.4 Mar 2013 5.5 Feb 2013 7.3 Jan 2013 7.3 Dec 1.9 Nov 0.8 Oct -1.6 Sep 4.1 Aug -5.4 Jul 2.1
China		2014 10.6 Jan 2013 4.3 Dec 12.7 Nov 5.6 Oct -0.3 Sep 7.2 Aug 5.1 Jul -3.1 Jun 1.0 May 14.7 Apr 10.0 Mar 21.8 Feb 25.0 Jan		2014 10.0 Jan 2013 8.3 Dec 5.3 Nov 7.6 Oct 7.4 Sep 7.0 Aug 10.9 Jul -0.7 Jun -0.3 May 16.8 Apr 14.1 Mar -15.2 Feb 28.8 Jan
Euro Area	3.8 12-M Dec	0.8 Jan-Dec	1.0 12-M Dec	-3.3 Jan-Dec
Germany	-0.9 Dec CSA	4.6 Dec	-0.6 Dec CSA	2.0 Dec
France Dec	-1.8	-0.8	-0.3	0.1
Italy Dec	5.1	4.9	3.6	0.6
UK	2.1 Dec	-0.1 Oct-Dec 13 /Dec-Oct 12	-3.8 Dec	-0.4 Oct-Dec 13/Oct-Dec 12
Net Trade % Points GDP Growth	% Points
USA	IVQ2013 0.99 IIIQ2013 0.14 IIQ2013 -0.07 IQ2013 -0.28 IVQ2012 +0.68 IIIQ2012 -0.03 IIQ2012 +0.10 IQ2012 +0.44
Japan	0.4 IQ2012 -1.3 IIQ2012 -2.2 IIIQ2012 -0.5 IVQ2012 1.7 IQ2013 0.5 IIQ2013 -2.0 IIIQ2013 -2.2 IVQ2013
Germany	IQ2012 0.8 IIQ2012 0.4 IIIQ2012 0.3 IVQ2012 -0.5 IQ2013 -0.3 IIQ2013 0.3 IIIQ2013 -0.3 IVQ2013 1.1
France	0.1 IIIQ2012 0.1 IVQ2012 -0.1 IQ2013 0.2 IIQ2013 -0.7 IIIQ2013 0.2 IVQ2013
UK	-0.8 IQ2012 -0.8 IIQ2012 +0.7 IIIQ2012 -0.5 IVQ2012 0.8 IQ2013 0.0 IIQ2013 -1.1 IIIQ2013 0.4 IVQ2013

Sources: Country Statistical Agencies http://www.census.gov/foreign-trade/ http://www.bea.gov/iTable/index_nipa.cfm

The geographical breakdown of exports and imports of Japan with selected regions and countries is provided in Table V-5 for Jan 2014. The share of Asia in Japan’s trade is more than one-half for 51.5 percent of exports and 45.6 percent of imports. Within Asia, exports to China are 16.4 percent of total exports and imports from China 23.7 percent of total imports. While exports to China increased 13.1 percent in the 12 months ending in Jan 2014, imports from China increased 27.2 percent. The largest export market for Japan in Jan 2014 is the US with share of 15.5 percent of total exports, which is close to that of China, and share of imports from the US of 8.2 percent in total imports. Japan’s exports to the US grew 21.9 percent in the 12 months ending in Jan 2014 and imports from the US grew 25.9 percent. Western Europe has share of 11.8 percent in Japan’s exports and of 9.5 percent in imports. Rates of growth of exports of Japan in Jan 2014 are relatively high for several countries and regions with growth of 21.9 percent for exports to the US, 6.6 percent for exports to Brazil and 31.0 percent for exports to Germany. Comparisons relative to 2011 may have some bias because of the effects of the Tōhoku or Great East Earthquake and Tsunami of Mar 11, 2011. Deceleration of growth in China and the US and threat of recession in Europe can reduce world trade and economic activity. Growth rates of imports in the 12 months ending in Jan 2014 are positive for all trading partners. Imports from Asia increased 27.2 percent in the 12 months ending in Jan 2014 while imports from China increased 34.4 percent. Data are in millions of yen, which may have effects of recent depreciation of the yen relative to the United States dollar (USD).

Table V-5, Japan, Value and 12-Month Percentage Changes of Exports and Imports by Regions and Countries, ∆% and Millions of Yen

Jan 2014	Exports Millions Yen	12 months ∆%	Imports Millions Yen	12 months ∆%
Total	5,252,882	9.5	8,042,855	25.0
Asia	2,702,690	5.8	3,669,120	27.2
China	862,565	13.1	1,907,358	34.4
USA	1,023,579	21.9	656,382	25.9
Canada	64,763	3.7	88,666	0.0
Brazil	38,084	6.6	100,655	8.2
Mexico	72,503	14.5	35,975	9.8
Western Europe	620,992	18.5	766,988	24.3
Germany	159,764	31.0	228,694	36.3
France	48,803	27.8	98,920	11.4
UK	87,871	-8.3	53,700	5.3
Middle East	204,313	24.9	1,657,065	31.6
Australia	110,155	15.2	476,640	21.9

Source: Japan, Ministry of Finance http://www.customs.go.jp/toukei/info/index_e.htm

World trade projections of the IMF are in Table V-6. There is increasing growth of the volume of world trade of goods and services from 2.9 percent in 2013 to 5.4 percent in 2015 and 5.1 percent on average from 2013 to 2018. World trade would be slower for advanced economies while emerging and developing economies (EMDE) experience faster growth. World economic slowdown would more challenging with lower growth of world trade.

Table V-6, IMF, Projections of World Trade, USD Billions, USD/Barrel and ∆%

	2013	2014	2015	Average ∆% 2013-2018
World Trade Volume (Goods and Services)	2.9	4.9	5.4	5.1
Exports Goods & Services	3.0	5.1	5.4	5.1
Imports Goods & Services	2.8	4.7	5.4	5.0
Oil Price USD/Barrel	104.49	101.35	NA	NA
Value of World Exports Goods & Services $B	23,164	24,367	NA	NA
Value of World Exports Goods $B	18,709	19,632	NA	NA
Exports Goods & Services
EMDE	3.5	5.8	6.3	5.9
G7	2.3	4.6	4.4	4.4
Imports Goods & Services
EMDE	5.0	5.9	6.7	6.2
G7	1.3	3.9	4.2	4.0
Terms of Trade of Goods & Services
EMDE	-0.5	-0.4	-0.6	-0.5
G7	0.1	-0.1	0.1	0.1
Terms of Trade of Goods
EMDE	-0.6	-0.9	-0.9	-0.8
G7	-0.5	0.2	0.2	-0.007

Notes: Commodity Price Index includes Fuel and Non-fuel Prices; Commodity Industrial Inputs Price includes agricultural raw materials and metal prices; Oil price is average of WTI, Brent and Dubai

Source: International Monetary Fund World Economic Outlook databank

http://www.imf.org/external/pubs/ft/weo/2013/02/weodata/index.aspx

The JP Morgan Global All-Industry Output Index of the JP Morgan Manufacturing and Services PMI^™, produced by JP Morgan and Markit in association with ISM and IFPSM, with high association with world GDP, decreased to 53.0 in Feb from 54.0 in Jan, indicating expansion at slower rate (http://www.markiteconomics.com/Survey/PressRelease.mvc/90d6571ed14f442d8ac0a59d7592a77f). This index has remained above the contraction territory of 50.0 during 55 consecutive months. The employment index decreased from 51.9 in Jan to 51.4 in Feb with input prices rising at slower rate, new orders increasing at faster rate and output increasing at slower rate (http://www.markiteconomics.com/Survey/PressRelease.mvc/90d6571ed14f442d8ac0a59d7592a77f). David Hensley, Director of Global Economics Coordination at JP Morgan finds temporary effects of services and weather with expectation of resumption of the growth impulse (http://www.markiteconomics.com/Survey/PressRelease.mvc/90d6571ed14f442d8ac0a59d7592a77f). The JP Morgan Global Manufacturing PMI^™, produced by JP Morgan and Markit in association with ISM and IFPSM, increased at 53.3 in Feb from 53.0 in Jan (http://www.markiteconomics.com/Survey/PressRelease.mvc/24962c60b7d34a84a661c0c2cb0ab8b8). New export orders expanded for the eighth consecutive month at a faster rate than in Jn (http://www.markiteconomics.com/Survey/PressRelease.mvc/24962c60b7d34a84a661c0c2cb0ab8b8). David Hensley, Director of Global Economic Coordination at JP Morgan finds slowing of the index from the strength at the end of 2013 even excluding the US with weather effects (http://www.markiteconomics.com/Survey/PressRelease.mvc/24962c60b7d34a84a661c0c2cb0ab8b8). The HSBC Brazil Composite Output Index, compiled by Markit, increased from 49.9 in Jan to 50.8 in Feb, indicating expanding activity of Brazil’s private sector (http://www.markiteconomics.com/Survey/PressRelease.mvc/71ab794bc85841cf85d5c0b70a6692a2). The HSBC Brazil Services Business Activity index, compiled by Markit, increased from 49.6 in Jan to 50.8 in Feb, indicating expanding services activity (http://www.markiteconomics.com/Survey/PressRelease.mvc/71ab794bc85841cf85d5c0b70a6692a2). André Loes, Chief Economist, Brazil, at HSBC, finds improving economy in Feb with more data required to assess conditions (http://www.markiteconomics.com/Survey/PressRelease.mvc/71ab794bc85841cf85d5c0b70a6692a2). The HSBC Brazil Purchasing Managers’ Index^TM (PMI^™) decreased marginally from 50.8 in Jan to 50.4 in Feb, indicating marginal improvement in manufacturing (http://www.markiteconomics.com/Survey/PressRelease.mvc/46aa9d753c9f4f25b7fb307a8fa92821). André Loes, Chief Economist, Brazil at HSBC, finds slower growth of manufacturing with input prices increasing at the fastest rhythm since Nov (http://www.markiteconomics.com/Survey/PressRelease.mvc/46aa9d753c9f4f25b7fb307a8fa92821).

VA United States. The Markit Flash US Manufacturing Purchasing Managers’ Index^™ (PMI^™) seasonally adjusted increased to 56.7 in Feb from 53.7 in Jan, which is the highest rate of improvement since May 2010 (http://www.markiteconomics.com/Survey/PressRelease.mvc/c7542a2e11a34e0eb2dc6d0da06fef6e). New export orders registered 50.9 in Feb, increasing from 48.4 in Jan, indicating marginal expansion. Chris Williamson, Chief Economist at Markit, finds that manufacturing hiring is growing with creation of about 15,000 jobs in Feb (http://www.markiteconomics.com/Survey/PressRelease.mvc/c7542a2e11a34e0eb2dc6d0da06fef6e). The Markit Flash US Services PMI™ Business Activity Index increased from 55.7 in Dec to 56.6 in Jan (http://www.markiteconomics.com/Survey/PressRelease.mvc/979201249645452086dde674d0d375e0). Chris Williamson, Chief Economist at Markit, finds that the surveys are consistent with growth of jobs at monthly rate of 200,000 (http://www.markiteconomics.com/Survey/PressRelease.mvc/979201249645452086dde674d0d375e0). The Markit US Composite PMI™ Output Index of Manufacturing and Services decreased to 54.1 in Feb from 56.2 in Jan (http://www.markiteconomics.com/Survey/PressRelease.mvc/d041468211fe42bdad220ac2d97e2972). The Markit US Services PMI™ Business Activity Index decreased from 56.7 in Jan to 53.3 in Feb (http://www.markiteconomics.com/Survey/PressRelease.mvc/d041468211fe42bdad220ac2d97e2972). Chris Williamson, Chief Economist at Markit, finds weather effects with the indexes suggesting 1.7 percent annual growth in IQ2014 relative to 2.4 percent in IVQ2013 (http://www.markiteconomics.com/Survey/PressRelease.mvc/d041468211fe42bdad220ac2d97e2972). The Markit US Manufacturing Purchasing Managers’ Index^™ (PMI^™) increased to 57.1 in Feb from 53.7 in Jan, which indicates expansion at faster rate (http://www.markiteconomics.com/Survey/PressRelease.mvc/84b031abddba4c3e829492e8c6209db6). The index of new exports orders increased from 48.5 in Jan to 51.6 in Feb while total new orders increased from 53.9 in Jan to 59.6 in Feb. Chris Williamson, Chief Economist at Markit, finds that the index suggests the fastest improvement in US manufacturing in nearly four years (http://www.markiteconomics.com/Survey/PressRelease.mvc/84b031abddba4c3e829492e8c6209db6). The purchasing managers’ index (PMI) of the Institute for Supply Management (ISM) Report on Business^® increased 1.9 percentage points from 51.3 in Jan to 53.2 in Feb, which indicates growth at a faster rate (http://www.ism.ws/ISMReport/MfgROB.cfm?navItemNumber=12942). The index of new orders increased 3.0 percentage points from 60.6 in Oct to 63.6 in Nov. The index of exports decreased 13.2 percentage point from 64.4 in Dec to 51.2 in Nov, growing at a slower rate. The Non-Manufacturing ISM Report on Business^® PMI decreased 2.4 percentage points from 54.0 in Jan to 51.6 in Feb, indicating growth of business activity/production during 55 consecutive months, while the index of new orders increased 0.4 percentage points from 50.9 in Jan to 51.3 in Feb (http://www.ism.ws/ISMReport/NonMfgROB.cfm?navItemNumber=12943). Table USA provides the country economic indicators for the US.

Table USA, US Economic Indicators

Consumer Price Index	Jan 12 months NSA ∆%: 1.6; ex food and energy ∆%: 1.6 Jan month SA ∆%: 0.1; ex food and energy ∆%: 0.1 Blog 2/23/14
Producer Price Index	Finished Goods Jan 12-month NSA ∆%: 1.5; ex food and energy ∆% 1.7 Jan month SA ∆% = 0.6; ex food and energy ∆%: 0.5 Final Demand Jan 12-month NSA ∆%: 1.2; ex food and energy ∆% 1.3 Jan month SA ∆% = 0.2; ex food and energy ∆%: 0.4 Blog 2/23/14
PCE Inflation	Jan 12-month NSA ∆%: headline 1.2; ex food and energy ∆% 1.1 Blog 3/9/14
Employment Situation	Household Survey: Feb Unemployment Rate SA 6.7% Blog calculation People in Job Stress Feb: 29.1 million NSA, 17.8% of Labor Force Establishment Survey: Feb Nonfarm Jobs +175,000; Private +162,000 jobs created  Jan 12-month Average Hourly Earnings Inflation Adjusted ∆%: 0.4 Blog 3/9/14
Nonfarm Hiring	Nonfarm Hiring fell from 63.8 million in 2006 to 52.0 million in 2012 or by 11.8 million Private-Sector Hiring Dec 2013 3.005 million lower by 0.630 million than 3.635 million in Dec 2006 Blog 2/16/14
GDP Growth	BEA Revised National Income Accounts IQ2012/IQ2011 ∆%: 3.3 IIQ2012/IIQ2011 2.8 IIIQ2012/IIIQ2011 3.1 IVQ2012/IVQ2011 2.0 IQ2013/IQ2012 1.3 IIQ2013/IIQ2012 1.6 IIIQ2013/IIIQ2012 2.0 IVQ2013/IVQ2012 2.5 IQ2012 SAAR 3.7 IIQ2012 SAAR 1.2 IIIQ2012 SAAR 2.8 IVQ2012 SAAR 0.1 IQ2013 SAAR 1.1 IIQ2013 SAAR 2.5 IIIQ2013 SAAR 4.1 IVQ2013 SAAR 2.4 Blog 3/2/14
Real Private Fixed Investment	SAAR IVQ2013 3.8 ∆% IVQ2007 to IVQ2013: minus 2.7% Blog 3/2/14
Personal Income and Consumption	Jan month ∆% SA Real Disposable Personal Income (RDPI) SA ∆% 0.3 Real Personal Consumption Expenditures (RPCE): 0.3 12-month Jan NSA ∆%: RDPI: 2.8; RPCE ∆%: 2.2 Blog 3/9/14
Quarterly Services Report	IIIQ13/IIQ12 NSA ∆%: Information 4.9 Financial & Insurance 0.6 Blog 12/15/13
Employment Cost Index	Compensation Private IVQ2013 SA ∆%: 0.5 Dec 12 months ∆%: 1.9 Blog 2/9/14
Industrial Production	Jan month SA ∆%: -0.3 Jan 12 months SA ∆%: 2.9 Manufacturing Jan SA ∆% minus 0.8 Jan 12 months SA ∆% 1.3, NSA 1.3 Capacity Utilization: 78.5 Blog 2/16/14
Productivity and Costs	Nonfarm Business Productivity IVQ2013∆% SAAE 1.8; IVQ2013/IVQ2012 ∆% 1.3; Unit Labor Costs SAAE IVQ2013 ∆% -0.1; IVQ2013/IVQ2012 ∆%: -0.9 Blog 3/9/2014
New York Fed Manufacturing Index	General Business Conditions From Jan 12.51 to Feb 4.48 New Orders: From Jan 10.98 to Feb -0.21 Blog 2/23/14
Philadelphia Fed Business Outlook Index	General Index from Jan 9.4 to Feb -6.3 New Orders from Jan 5.1 to Feb -5.12 Blog 2/23/14
Manufacturing Shipments and Orders	New Orders SA Jan ∆% -0.7 Ex Transport 0.2 Jan NSA New Orders ∆% 1.2 Ex transport 0.4 Blog 3/9/14
Durable Goods	Jan New Orders SA ∆%: minus 1.0; ex transport ∆%: 1.1 Jan 14/Jan 13 New Orders NSA ∆%: 3.4; ex transport ∆% 0.4 Blog 3/2/14
Sales of New Motor Vehicles	Jan-Feb 2014 2,206,454; Feb 2013 2,238,820. Feb 14 SAAR 15.34 million, Jan 14 SAAR 15.34 million, Feb 2013 SAAR 15.34 million Blog 3/9/14
Sales of Merchant Wholesalers	Jan-Dec 2013/Jan-Dec 2012 NSA ∆%: Total 4.2; Durable Goods: 4.4; Nondurable Goods: 4.1 Blog 2/16/14
Sales and Inventories of Manufacturers, Retailers and Merchant Wholesalers	Dec 13 12-M NSA ∆%: Sales Total Business 5.2; Manufacturers 2.9 Retailers 3.8; Merchant Wholesalers 9.4 Blog 2/16/14
Sales for Retail and Food Services	Jan 2014/Jan 2012 ∆%: Retail and Food Services 3.0; Retail ∆% 3.0 Blog 2/16/14
Value of Construction Put in Place	Jan SAAR month SA ∆%: 0.1 Jan 12-month NSA: 9.4 Blog 3/9/14
Case-Shiller Home Prices	Dec 2013/Dec 2012 ∆% NSA: 10 Cities 13.6; 20 Cities: 13.4 ∆% Dec SA: 10 Cities 0.8 ; 20 Cities: 0.8 Blog 3/2/14
FHFA House Price Index Purchases Only	Dec SA ∆% 0.8; 12 month NSA ∆%: 7.7 Blog 3/2/14
New House Sales	Jan 2014 month SAAR ∆%: 9.6 Jan-Dec 2013/Jan-Dec 2012 NSA ∆%: 16.4 Blog 3/2/14
Housing Starts and Permits	Jan Starts month SA ∆% minus16.0; Permits ∆%: minus 5.4 Jan 2014/Jan 2013 NSA ∆% Starts 18.7; Permits  ∆% 17.7 Blog 2/23/14
Trade Balance	Balance Jan SA -$39,095 million versus Dec -$38,975 million Exports Jan SA ∆%: 0.6 Imports Jan SA ∆%: 0.6 Goods Exports Jan 2014/Jan 2013 NSA ∆%: 3.3 Goods Imports Jan 2014/Jan 2012 NSA ∆%: -0.3 Blog 3/9/14
Export and Import Prices	Jan 12-month NSA ∆%: Imports -1.5; Exports -1.2 Blog 2/16/14
Consumer Credit	Jan ∆% annual rate: Total 5.3; Revolving -0.3; Nonrevolving 7.5 Blog 3/9/14
Net Foreign Purchases of Long-term Treasury Securities	Dec Net Foreign Purchases of Long-term US Securities: -$45.9 billion Major Holders of Treasury Securities: China $1269 billion; Japan $1183 billion; Total Foreign US Treasury Holdings Nov $5795 billion Blog 2/23/14
Treasury Budget	Fiscal Year 2014/2013 ∆% Jan: Receipts 8.2; Outlays minus 2.8; Individual Income Taxes 1.6 Deficit Fiscal Year 2011 $1,300 billion Deficit Fiscal Year 2012 $1,087 billion Deficit Fiscal Year 2013 $680 billion Blog 2/16/2014
CBO Budget and Economic Outlook	2012 Deficit $1087 B 6.8% GDP Debt 11,281 B 70.1% GDP 2013 Deficit $680 B, 4.1% GDP Debt 11,982 B 72.1% GDP Blog 8/26/12 11/18/12 2/10/13 9/22/13 2/16/14
Commercial Banks Assets and Liabilities	Jan 2014 SAAR ∆%: Securities 1.7 Loans 3.7 Cash Assets 24.9 Deposits 8.9 Blog 3/2/14
Flow of Funds	IIIQ2013 ∆ since 2007 Assets +$8554.2 MM Nonfinancial -$1228.7 MM Real estate -$1838.9 MM Financial +9782.9 MM Net Worth +$9269.0 MM Blog 12/29/13
Current Account Balance of Payments	IIIQ2013 -110,055 MM %GDP 2.2 Blog 12/22/13

Links to blog comments in Table USA:

3/2/14 http://cmpassocregulationblog.blogspot.com/2014/03/financial-risks-slow-cyclical-united.html

2/23/14 http://cmpassocregulationblog.blogspot.com/2014/02/squeeze-of-economic-activity-by-carry.html

2/16/14 http://cmpassocregulationblog.blogspot.com/2014/02/theory-and-reality-of-cyclical-slow.html

2/9/14 http://cmpassocregulationblog.blogspot.com/2014/02/financial-instability-rules.html

12/29/13 http://cmpassocregulationblog.blogspot.com/2013/12/collapse-of-united-states-dynamism-of.html

12/22/13 http://cmpassocregulationblog.blogspot.com/2013/12/tapering-quantitative-easing-mediocre.html

12/15/13 http://cmpassocregulationblog.blogspot.com/2013/12/theory-and-reality-of-secular.html

9/22/13 http://cmpassocregulationblog.blogspot.com/2013/09/duration-dumping-and-peaking-valuations.html

2/10/13 http://cmpassocregulationblog.blogspot.com/2013/02/united-states-unsustainable-fiscal.html

Motor vehicle sales and production in the US have been in long-term structural change. Table VA-1 provides the data on new motor vehicle sales and domestic car production in the US from 1990 to 2010. New motor vehicle sales grew from 14,137 thousand in 1990 to the peak of 17,806 thousand in 2000 or 29.5 percent. In that same period, domestic car production fell from 6,231 thousand in 1990 to 5,542 thousand in 2000 or -11.1 percent. New motor vehicle sales fell from 17,445 thousand in 2005 to 11,772 in 2010 or 32.5 percent while domestic car production fell from 4,321 thousand in 2005 to 2,840 thousand in 2010 or 34.3 percent. In Feb 2014, light vehicle sales accumulated to 2,206,454, which is lower by 1.4 percent relative to 2,238,820 a year earlier (http://motorintelligence.com/m_frameset.html). The seasonally adjusted annual rate of light vehicle sales in the US reached 15.34 million in Feb 2014, higher than 15.24 million in Jan 2014 and close to 15.34 million in Feb 2013 (http://motorintelligence.com/m_frameset.html).

Table VA-1, US, New Motor Vehicle Sales and Car Production, Thousand Units

	New Motor Vehicle Sales	New Car Sales and Leases	New Truck Sales and Leases	Domestic Car Production
1990	14,137	9,300	4,837	6,231
1991	12,725	8,589	4,136	5,454
1992	13,093	8,215	4,878	5,979
1993	14,172	8,518	5,654	5,979
1994	15,397	8,990	6,407	6,614
1995	15,106	8,536	6,470	6,340
1996	15,449	8,527	6,922	6,081
1997	15,490	8,273	7,218	5,934
1998	15,958	8,142	7,816	5,554
1999	17,401	8,697	8,704	5,638
2000	17,806	8,852	8,954	5,542
2001	17,468	8,422	9,046	4,878
2002	17,144	8,109	9,036	5,019
2003	16,968	7,611	9,357	4,510
2004	17,298	7,545	9,753	4,230
2005	17,445	7,720	9,725	4,321
2006	17,049	7,821	9,228	4,367
2007	16,460	7,618	8,683	3,924
2008	13,494	6,814	6.680	3,777
2009	10,601	5,456	5,154	2,247
2010	11,772	5,729	6,044	2,840

Source: US Census Bureau http://www.census.gov/compendia/statab/cats/wholesale_retail_trade/motor_vehicle_sales.html

Chart VA-1 of the Board of Governors of the Federal Reserve provides output of motor vehicles and parts in the United States from 1972 to 2014. Output virtually stagnated since the late 1990s.

Chart VA-1, US, Motor Vehicles and Parts Output, 1972-2014

Source: Board of Governors of the Federal Reserve System

http://www.federalreserve.gov/releases/g17/Current/default.htm

Manufacturers’ shipments decreased 0.3 percent in Jan 2014 and decreased 0.3 percent in Dec 2013 after increasing 0.8 percent in Nov 2013. New orders decreased 0.7 percent in Jan 2014, after decreasing 2.0 percent in Dec 2013 and increasing 1.5 percent in Nov 2013, as shown in Table VA-2. These data are very volatile. Volatility is illustrated by increase of 2642.2 percent of new orders of nondefense aircraft in Sep 2012 following decline by 97.2 percent in Aug. New orders excluding transportation equipment increased 0.2 percent in Jan 2014 after decreasing 0.1 percent in Dec 2013 and increasing 0.3 percent in Nov 2013. Capital goods new orders, indicating investment, decreased 2.4 percent in Jan 2014 after decreasing 8.5 percent in Dec 2013 and increasing 7.4 percent in Nov 2013. New orders of nondefense capital goods decreased 4.1 percent in Jan 2014 after decreasing 6.3 percent in Dec 2013 and increasing 8.2 percent in Nov 2013. Excluding more volatile aircraft, capital goods orders increased 1.5 percent in Jan 2014 after decreasing 1.6 percent in Dec 2013 and increasing 3.0 percent in Nov 2013.

Table VA-2, US, Value of Manufacturers’ Shipments and New Orders, SA, Month ∆%

	Jan 2014  ∆%	Dec 2013 ∆%	Nov 2013  ∆%
Total
S	-0.3	-0.3	0.8
NO	-0.7	-2.0	1.5
Excluding Transport
S	-0.4	0.7	0.7
NO	0.2	-0.1	0.3
Excluding Defense
S	-0.4	0.0	0.6
NO	-1.0	-1.5	1.5
Durable Goods
S	-0.3	-1.7	1.4
NO	-1.0	-5.3	2.7
Machinery
S	-2.9	0.9	3.6
NO	-0.7	3.0	3.2
Computers & Electronic Products
S	0.7	2.5	2.4
NO	3.7	-8.7	0.8
Computers
S	-5.8	-6.4	9.8
NO	-46.0	-7.1	8.3
Transport Equipment
S	0.1	-6.1	1.6
NO	-5.7	-12.1	8.1
Automobiles
S	-1.8	-13.5	-2.9
Motor Vehicles
S	-0.6	-2.3	1.5
NO	-0.9	-1.2	2.1
Nondefense Aircraft
S	4.0	3.7	-8.3
NO	-20.2	-22.3	21.1
Capital Goods
S	-1.4	0.2	2.1
NO	-2.4	-8.5	7.4
Nondefense Capital Goods
S	-1.2	1.5	1.0
NO	-4.1	-6.3	8.2
Capital Goods ex Aircraft
S	-1.0	0.6	2.4
NO	1.5	-1.6	3.0
Nondurable Goods
S	-0.4	1.0	0.4
NO	-0.4	1.0	-0.4

Note: Mfg: manufacturing; S: shipments; NO: new orders; Transport: transportation

Source: US Census Bureau

http://www.census.gov/manufacturing/m3/

Chart VA-2 of the US Census Bureau provides new orders of manufacturers from Feb 2013 to Jan 2014. There is significant volatility that prevents discerning clear trends.

Chart VA-2, US, Manufacturers’ New Orders 2012-2014 Seasonally Adjusted, Month ∆%

Source: US Census Bureau

http://www.census.gov/briefrm/esbr/www/esbr022.html

Chart VA-3 of the US Census Bureau provides total value of manufacturers’ new orders, seasonally adjusted, from 1992 to 2014. Seasonal adjustment reduces sharp oscillations. The series dropped nearly vertically during the global recession but rose along a path even steeper than in the high-growth period before the recession. The final segment suggests deceleration but similar segments occurred in earlier periods followed with continuing growth and stability currently.

Chart VA-3, US, Value of Total Manufacturers’ New Orders, Seasonally Adjusted, 1992-2014

Source: US Census Bureau

http://www.census.gov/manufacturing/m3/

Additional perspective on manufacturers’ shipments and new orders is provided by Table VA-2. Values are cumulative millions of dollars in Jan 2014 not seasonally adjusted (NSA). Shipments of all manufacturing industries in Jan 2014 total $458.9 billion and new orders total $454.0 billion, growing respectively by 1.8 percent and 1.2 percent relative to the same period in 2013. Excluding transportation equipment, shipments grew 1.4 percent and new orders increased 0.4 percent. Excluding defense, shipments grew 1.8 percent and new orders grew 1.7 percent. Durable goods shipments reached $211.8 billion in Jan 2014, or 46.2 percent of the total, growing by 3.5 percent, and new orders $206.8 billion, or 45.6 percent of the total, growing by 2.3 percent. Important information in Table VA-2 is the large share of nondurable goods with shipments of $247.2 billion or 53.9 percent of the total, growing by 0.3 percent. Capital goods have relatively high value of $72.6 billion for shipments, growing 3.2 percent, and new orders $74.3 billion, increasing 1.2 percent, which could be an indicator of future investment. Excluding aircraft, capital goods shipments reached $59.3 billion, growing 2.4 percent, and new orders $64.2 billion, decreasing 1.7 percent. There is no suggestion in these data that the US economy is close to recession but manufacturing accounts for 10.8 percent of US national income in IIIQ2013. These data are not adjusted for inflation.

Table VA-2, US, Value of Manufacturers’ Shipments and New Orders, NSA, Millions of Dollars 

Jan 2014	Shipments	∆% 2013/ 2012	New Orders	∆% 2013/ 2012
Total	458,973	1.8	454,029	1.2
Excluding Transport	399,739	1.4	396,764	0.4
Excluding Defense	449,345	1.8	447,019	1.7
Durable Goods	211,817	3.5	206,873	2.3
Machinery	30,826	2.1	35,155	2.8
Computers & Electronic Products	26,782	6.2	18,002	-0.8
Computers	364	-24.5	178	-62.2
Transport Equipment	59,234	4.8	57,265	7.5
Automobiles	8,683	-11.3
Motor Vehicles	18,763	8.4	18,921	9.1
Nondefense Aircraft	8,974	15.7	8,736	54.7
Capital Goods	72,562	3.2	74,298	1.2
Nondefense Capital Goods	64,713	3.3	68,789	2.5
Capital Goods ex Aircraft	59,344	2.4	64,213	-1.7
Nondurable Goods	247,156	0.3	247,156	0.3
Food Products	62,464	3.2
Petroleum Refineries	67,145	0.0
Chemical Products	60,857	-0.8

Note: Transport: transportation Source: US Census Bureau

Source: US Census Bureau

http://www.census.gov/manufacturing/m3/

Chart VA-4 of the US Census Bureau provides value of manufacturer’s new orders not seasonally adjusted from Jan 1992 to Jan 2014. Fluctuations are evident, which are smoothed by seasonal adjustment in the earlier Chart VA-4. The series drops nearly vertically during the global contraction and then resumes growth in a steep upward trend, flattening recently.

Chart VA-4, US, Value of Total Manufacturers’ New Orders, Not Seasonally Adjusted, 1992-2014

Source: US Census Bureau

http://www.census.gov/manufacturing/m3/

Construction spending at seasonally adjusted annualized rate (SAAR) reached $943.1 billion in Jan 2013, which was higher by 0.1 percent than in the prior month of Dec 2013, as shown in Table VA-3. Residential investment, with $364.5 billion accounting for 38.6 percent of total value of construction, increased 0.9 percent in Jan and nonresidential investment, with $578.7 billion accounting for 61.4 percent of the total, decreased 0.3 percent. Public construction decreased 0.8 percent while private construction increased 0.5 percent. Data in Table VA-3 show that nonresidential construction at $578.7 billion is much higher in value than residential construction at $364.5 billion while total private construction at $670.8 billion is much higher than public construction at $272.3 billion, all in SAAR. Residential and nonresidential construction contributed positively to growth of GDP in the US in all quarters in 2012. Nonresidential investment deducted 0.57 percentage points from GDP growth in IQ2013 while residential construction added 0.34 percentage points. Nonresidential construction added 0.56 percentage points to GDP growth in IIQ2013 with residential construction adding 0.40 percentage points. Nonresidential construction added 0.58 percentage points to GDP growth in IIIQ2013 while residential construction added 0.31 percentage points. Nonresidential construction added 0.87 percentage points to GDP growth in IVQ2013 while residential construction deducted 0.29 percentage points. In 2012, residential construction added 0.32 percentage points to GDP growth and added 0.01 percentage points in 2011. Residential construction added 0.33 percentage points to GDP growth in 2013. Nonresidential construction added 0.85 percentage points to GDP growth in 2012 and 0.84 percentage points in 2011. Nonresidential construction added 0.34 percentage points to GDP growth in 2013 (http://cmpassocregulationblog.blogspot.com/2014/03/financial-risks-slow-cyclical-united.html).

Table VA-3, Construction Put in Place in the United States Seasonally Adjusted Annual Rate Million Dollars and Month and 12-Month ∆%  

Jan 2014	Jan 2014 SAAR  $ Millions	Month ∆%	12-Month ∆%
Total	943,139	0.1	9.3
Residential	364,462	0.9	13.9
Nonresidential	578,677	-0.3	6.5
Total Private	670,799	0.5	12.3
Private Residential	359,930	1.1	14.6
New Single Family	186,960	2.3	21.0
New Multi-Family	36,258	1.0	28.0
Private Nonresidential	310,870	-0.2	9.7
Total Public	272,340	-0.8	2.5
Public Residential	4,533	-13.4	-22.2
Public Nonresidential	267,807	-0.5	3.0

SAAR: seasonally adjusted annual rate; B: billions

Source: US Census Bureau http://www.census.gov/construction/c30/c30index.html

Further information on construction spending is provided in Table VA-4. The original monthly estimates not-seasonally adjusted (NSA) and their 12-month rates of change are provided in the first two columns while the SAARs and their monthly changes are provided in the final two columns. There has been improvement in construction in the US. There are only four declines in the monthly rate from Dec 2011 to Jan 2014. Growth in 12 months fell from 9.5 percent in Dec 2012 to 3.8 percent in Dec 2013, rebounding 9.4 percent in Jan 2014.

Table VA-4, US, Value and Percentage Change in Value of Construction Put in Place, Dollars Millions and ∆%

	Value NSA Month $ Millions	12-Month ∆% NSA	Value SAAR $ Millions	Month ∆% SA*
Jan 2014	64,689	9.4	943,139	0.1
Dec 2013	70,759	3.8	941,895	1.5
Nov	77,931	1.1	928,312	0.6
Oct	85,193	4.5	922,898	0.7
Sep	85,383	5.7	916,520	1.4
Aug	85,677	4.9	903,786	0.1
Jul	83,104	5.3	902,854	0.6
Jun	81,722	4.9	897,113	0.1
May	77,327	7.0	896,134	2.0
Apr	70,535	6.5	878,396	1.1
Mar	64,036	5.3	869,164	-0.1
Feb	58,395	4.3	869,909	0.8
Jan	59,143	6.2	863,136	-2.3
Dec 2012	68,136	9.5	883,550	0.1
Nov	77,091	12.0	882,685	2.3
Oct	81,520	9.8	863,065	-1.2
Sep	80,812	7.2	873,259	2.2
Aug	81,712	6.0	854,048	-0.3
Jul	78,897	9.4	856,348	0.1
Jun	77,876	6.9	855,779	1.3
May	72,240	9.8	844,709	1.4
Apr	66,223	7.8	833,243	0.8
Mar	60,796	7.5	826,641	0.4
Feb	55,981	10.8	823,331	0.7
Jan	55,671	9.3	817,616	0.0
Dec 2011	62,242	3.4	817,569	1.0

SAAR: Seasonally Adjusted Annual Rate

Source: US Census Bureau http://www.census.gov/construction/c30/c30index.html

The sharp contraction of the value of construction in the US is revealed by Table VA-5. Construction spending in Jan-Dec 2013, not seasonally adjusted, reached $899.2 billion, which is higher by 4.9 percent than $856.9 billion in the same period in 2012. The depth of the contraction is shown by the decline of construction spending from $1192.2 billion in Jan-Dec 2006 to only $899.2 billion in the same period in 2013, or decline by minus 24.6 percent. The decline in inflation-adjusted terms is much higher. The all-items not seasonally adjusted CPI (consumer price index) increased from 201.8 in Dec 2006 to 233.049 in Dec 2013 (http://www.bls.gov/cpi/data.htm) or by 15.5 percent. The comparable decline from Jan-Dec 2005 to Jan-Dec 2013 is minus 21.4 percent. Construction spending in Jan-Dec 2013 decreased by 1.8 percent relative to the same period in 2003. Construction spending is lower by 0.9 percent in Jan-Dec 2013 relative to the same period in 2009. Construction has been weaker than the economy as a whole.

Table VA-5, US, Value of Construction Put in Place in the United States, Not Seasonally Adjusted, $ Millions and ∆%

Jan-Dec 2013 $ MM	899,206
Jan-Dec 2012	856,953
∆% to 2013	4.9
Jan-Dec 2011 $ MM	778,238
∆% to 2013	15.5
Jan-Dec 2010 $ MM	803,621
∆% to 2013	11.9
Jan-Dec 2009 $MM	907,784
∆% to 2013	-0.9
Jan-Dec 2006 $ MM	1,192,238
∆% to 2013	-24.6
Jan-Dec 2005 $ MM	1,143,655
∆% to 2013	-21.4
Jan-Dec 2003 $ MM	915,742
∆% to 2013	-1.8

Source: US Census Bureau http://www.census.gov/construction/c30/c30index.html

Chart VA-5 of the US Census Bureau provides value of construction spending in the US not seasonally adjusted from 2002 to 2014. There are wide oscillations requiring seasonal adjustment to compare adjacent data. There was sharp decline during the global recession followed in recent periods by a stationary series that may be moving upward again with vacillation in the final segment.

Chart VA-5, Value of Construction Spending not Seasonally Adjusted, Millions of Dollars, 2002-2014

Source: US Census Bureau http://www.census.gov/construction/c30/c30index.html

Monthly construction spending in the US in Jan and Sep-Dec not seasonally adjusted is shown in Table VA-6 for the years between 2002 and 2014. The value of $64.7 billion in Jan 2014 is higher by 9.4 percent than $59.1 billion in Jan 2013. Construction fell by 20.2 percent from the peak of $81.1 billion in Jan 2006 to $64.7 billion in Jan 2014. The data are not adjusted for inflation or changes in quality.

Table VA-6, US, Value of Construction Spending Not Seasonally Adjusted, Millions of Dollars

	Jan	Sep	Oct	Nov	Dec
2002	59,516	76,542	75,710	71,362	63,984
2003	59,877	83,841	83,133	77,915	71,050
2004	64,934	92,538	90,582	86,394	77,733
2005	71,474	103,269	102,339	97,549	88,172
2006	81,058	104,191	101,582	95,339	86,436
2007	79,406	105,150	103,847	94,822	84,218
2008	77,349	96,755	95,612	86,067	76,645
2009	66,944	81,213	79,949	71,906	64,098
2010	55,586	74,764	73,470	68,019	60,202
2011	50,955	75,372	74,222	68,809	62,242
2012	55,671	80,812	81,520	77,091	68,136
2013	59,143	85,383	85,193	77,931	70,759
2014	64,689	NA	NA	NA	NA

Source: US Census Bureau http://www.census.gov/construction/c30/c30index.html

Chart VA-6 of the US Census Bureau shows SAARs of construction spending for the US since 1993. Construction spending surged in nearly vertical slope after the stimulus of 2003 combining near zero interest rates together with other housing subsidies and subsequent slow adjustment in 17 doses of increases by 25 basis points between Jun 2004 and Jun 2006. Construction spending collapsed after subprime mortgages defaulted with the fed funds rate increasing from 1.00 percent in Jun 2004 to 5.25 percent in Jun 2006. Subprime mortgages were programmed for refinancing in two years after increases in homeowner equity in the assumption that fed funds rates would remain low forever or increase in small increments (Gorton 2009EFM see http://cmpassocregulationblog.blogspot.com/2011/07/causes-of-2007-creditdollar-crisis.html). Price declines of houses or even uncertainty prevented refinancing of subprime mortgages that defaulted, causing the financial crisis that eventually triggered the global recession. Chart VA-6 shows a trend of increase in the final segment but it is difficult to assess if it is sustainable.

Chart VA-6, US, Construction Expenditures SAAR 1993-2014

Source: US Census Bureau

http://www.census.gov/briefrm/esbr/www/esbr050.htmlhttp://www.census.gov/briefrm/esbr/www/esbr050.html

Construction spending at SAARs in the four months Sep to Dec is shown in Table VA-7 for the years between 2002 and 2013. There is a peak in 2005 to 2007 with subsequent collapse of SAARs and rebound in 2012-2014.

Table VA-7, US, Value of Construction Spending SAAR Millions of Dollars

Year	Jan	Oct	Nov	Dec
2002	858,654	839,690	844,697	855,921
2003	863,855	925,732	925,985	948,491
2004	938,826	1,015,562	1,023,210	1,037,684
2005	1,036,187	1,145,663	1,156,977	1,178,305
2006	1,183,861	1,139,292	1,137,488	1,153,491
2007	1,149,899	1,152,511	1,127,558	1,108,958
2008	1,106,047	1,050,690	1,029,211	993,515
2009	962,704	869,374	850,732	832,565
2010	816,132	800,266	798,328	779,895
2011	757,039	806,514	809,089	817,569
2012	817,616	863,065	882,685	883,550
2013	863,136	922,898	928,312	941,895
2014	943,139	NA	NA	NA

Source: US Census Bureau

http://www.census.gov/briefrm/esbr/www/esbr050.html

Chart VA-7 of the US Census Bureau provides SAARs of value of construction from 2002 to 2014. There is clear acceleration after 2003 when fed funds rates were fixed at 1.0 percent from Jun 2003 until Jun 2004. Construction peaked in 2005-2006, stabilizing in 2007 at a lower level and then collapsed in a nearly vertical drop until 2011 with increases into 2012 and marginal drop in Jan 2013 followed by increase in Feb 2013 and decline in Mar 2013 followed by continuing increase in Apr-May 2013. Construction stabilized in Jun 2013 and increased in Jul-Aug 2013. Construction declined in Sep 2013 and increased in Oct-Dec 2013 and Jan 2014.

Chart VA-7, US, Construction Expenditures SAAR 2002-2014

Source: US Census Bureau

http://www.census.gov/construction/c30/c30index.html

Chart VA-8 of the US Census Bureau provides monthly residential construction in the US not seasonally adjusted from 2002 to 2014. There was steep increase until 2006 followed by sharp contraction. The series stabilized at the bottom and increased in the final segment with subsequent stability.

Chart VA-8, US, Residential Construction, Not Seasonally Adjusted, Millions of Dollars, 2002-2014

Source: US Census Bureau http://www.census.gov/construction/c30/c30index.html

Chart VA-9 of the US Census Bureau provides monthly nonresidential construction in the US not seasonally adjusted. There is similar acceleration until 2006 followed by milder contraction than for residential construction. The final segment appears stationary.

Chart VA-9, US, Nonresidential Construction, Not Seasonally Adjusted, Millions of Dollars, 2002-2014

http://www.census.gov/construction/c30/c30index.html

Annual available data for the value of construction put in place in the US between 1993 and 2013 are provided in Table VA-32. Data from 1993 to 2001 are available for public and private construction with breakdown in residential and nonresidential only for private construction. Data beginning in 2002 provide aggregate residential and nonresidential values. Total construction value put in place in the US increased 85.2 percent between 1993 and 2013 but most of the growth, 65.3 percent, was concentrated in 1993 to 2000 with increase of 12.0 percent between 2000 and 2013. Total value of construction increased 6.1 percent between 2002 and 2013 with value of nonresidential construction increasing 26.0 percent while value of residential construction fell 16.1 percent. Value of total construction fell 18.6 percent between 2005 and 2013, with value of residential construction declining 45.4 percent while value of nonresidential construction rose 15.5 percent. Value of total construction fell 23.0 percent between 2006 and 2013, with value of nonresidential construction increasing 2.7 percent while value of residential construction fell 45.6 percent. In 2002, nonresidential construction had share of 52.6 percent in total construction while the share of residential construction was 47.4 percent. In 2013, the share of nonresidential construction in total value rose to 62.5 percent while that of residential construction fell to 37.5 percent.

Table VA-8, Annual Value of Construction Put in Place 1993-2012, Millions of Dollars and ∆% 

	Total	Private Nonresidential	Private Residential
1993	485,548	150,006	208,180
1994	531,892	160,438	241,033
1995	548,666	180,534	228,121
1996	599,693	195,523	257,495
1997	631,853	213,720	264,696
1998	688,515	237,394	296,343
1999	744,551	249,167	326,302
2000	802,756	275,293	346,138
2001	840,249	273,922	364,414
	Total	Total Nonresidential	Total Residential
2002	847,874	445,914	401,960
2003	891,497	440,246	451,251
2004	991,356	452,948	538,408
2005	1,104,136	486,629	617,507
2006	1,167,222	547,408	619,814
2007	1,152,351	651,883	500,468
2008	1,067,564	709,818	357,746
2009	903,201	649,273	253,928
2010	804,561	555,449	249,112
2011	788,014	535,357	252,657
2012	856,953	570,429	286,524
2013	899,206	561,936	337,270
∆% 1993-2013	85.2
∆% 1993-2000	65.3
∆% 2000-2013	12.0
∆% 2002-2013	6.1	26.0	-16.1
∆% 2005-2013	-18.6	15.5	-45.4
∆% 2006-2013	-23.0	2.7	-45.6

Source: US Census Bureau http://www.census.gov/construction/c30/c30index.html

The report of consumer credit outstanding of the Board of Governors of the Federal Reserve System is provided in Table VA-9. The data are in seasonally adjusted annual rates both percentage changes and billions of dollars. The estimate of consumer credit “covers most short- and intermediate-term credit extended to individuals, excluding loans secured by real estate (http://www.federalreserve.gov/releases/g19/current/default.htm). Consumer credit is divided into two categories. (1) Revolving consumer credit (REV in Table VA-9) consists mainly of unsecured credit cards. (2) Non-revolving consumer credit (NREV in Table VA-9) “includes automobile loans and all other loans not included in revolving credit, such as loans for mobile homes, education, boats, trailers or vacations” (http://www.federalreserve.gov/releases/g19/current/default.htm). In Jan 2014, revolving credit was $856 billion, or 27.5 percent of total consumer credit of $3112 billion, and non-revolving credit was $2256 billion, or 72.5 percent of total consumer credit outstanding. Consumer credit grew at relatively high rates before the recession beginning in IVQ2007 (Dec) and extending to IIQ2009 (Jun) as dated by the National Bureau of Economic Research or NBER (http://www.nber.org/cycles/cyclesmain.html). Percentage changes of consumer credit outstanding fell already in 2009. Rates were still negative in 2010 with decline of 1.0 percent in annual data and sharp decline of 7.6 percent in revolving credit. In IVQ 2012, total consumer credit grew at 6.5 percent with increase of revolving credit at 0.3 percent and increase of non-revolving credit at 9.1 percent. Growth continued in Jan 2014 with total credit at 5.3 percent, revolving at minus 0.3 percent and non-revolving at 7.5 percent.

Table VA-9, US, Consumer Credit Outstanding, SA, Annual Rate and Billions of Dollars

	Total ∆%	REV ∆%	NRV ∆%	Total $B	REV $B	NREV $B
2014
Jan	5.3	-0.3	7.5	3112	856	2256
2013
Dec	6.2	4.3	6.9	3099	857	2242
Nov	3.4	-3.7	6.2	3082	853	2229
IVQ	5.4	1.9	6.8	3099	857	2242
IIIQ	5.9	0.4	8.1	3057	852	2205
IIQ	5.8	1.2	7.6	3012	851	2161
IQ	6.2	1.5	8.1	2969	849	2120
2012
IVQ	6.5	0.3	9.1	2924	846	2078
2013	6.0	1.3	7.9	3099	857	2242
2012	6.1	0.4	8.7	2924	846	2078
2011	4.1	0.2	5.9	2757	842	1915
2010	-1.0	-7.6	2.7	2648	841	1807
2009	-3.9	-8.8	-1.0	2553	917	1636
2008	1.3	0.2	2.0	2651	1005	1646
2007	5.9	8.5	4.3	2529	1008	1521

Note: REV: Revolving; NREV: Non-revolving; ∆%: simple annual rate from unrounded data; Total may not add exactly because of rounding

Source: Board of Governors of the Federal Reserve System

http://www.federalreserve.gov/releases/g19/current/default.htm

Chart VA-10 of the Board of Governors of the Federal Reserve System total consumer credit outstanding in millions of dollars measured in the right axis and the finance rate on 24-month personal loans at commercial banks, not seasonally adjusted, measured on the left axis. There was sharp decline of total consumer loans outstanding during the global recession followed by strong recovery. There is long-term decline of the financing rate.

Chart VA-10, US, Total Consumer Credit Owned and Securitized NSA and Financing Rate on 24-month Personal Loans at Commercial Banks NSA, Millions of Dollars and Percent, Feb 1972-Jan 2014

Source: Board of Governors of the Federal Reserve System

http://www.federalreserve.gov/releases/g19/current/default.htm

Chart VA-11 of the Board of Governors of the Federal Reserve System provides percentage changes of total consumer credit outstanding in the US and the financing rate on 24-month personal consumer loans at commercial banks, since 1972. The shaded bars are the cyclical contraction dates of the National Bureau of Economic Research (http://www.nber.org/cycles/cyclesmain.html). Consumer credit is cyclical, declining during contractions as shown by negative percentage changes during economic contractions. There is clear upward trend in 2012-2013 but with significant fluctuations.

Chart VA-11, US, Percent Change of Total Consumer Credit, Seasonally Adjusted at an Annual Rate and Finance Rate on 24-month Personal Loans at Commercial Banks NSA, Feb 1972-Jan 2014

Source: Board of Governors of the Federal Reserve System

http://www.federalreserve.gov/releases/g19/current/default.htm

VB Japan. Table VB-BOJF provides the forecasts of economic activity and inflation in Japan by the majority of members of the Policy Board of the Bank of Japan, which is part of their Outlook for Economic Activity and Prices (http://www.boj.or.jp/en/announcements/release_2013/k130711a.pdf). For fiscal 2013, the forecast is of growth of GDP between 2.5 and 2.9 percent, with the all items CPI less fresh food of 0.7 to 0.9 percent (http://www.boj.or.jp/en/announcements/release_2014/k140122a.pdf). The critical difference is forecast of the CPI excluding fresh food of 2.9 to 3.6 percent in 2014 and 1.7 to 2.9 percent in 2015. Consumer price inflation in Japan excluding fresh food was 0.0 percent in Nov 2013 and 1.2 percent in 12 months (http://www.stat.go.jp/english/data/cpi/1581.htm). The new monetary policy of the Bank of Japan aims to increase inflation to 2 percent. These forecasts are biannual in Apr and Oct. The Cabinet Office, Ministry of Finance and Bank of Japan released on Jan 22, 2013, a “Joint Statement of the Government and the Bank of Japan on Overcoming Deflation and Achieving Sustainable Economic Growth” (http://www.boj.or.jp/en/announcements/release_2013/k130122c.pdf) with the important change of increasing the inflation target of monetary policy from 1 percent to 2 percent:

“The Bank of Japan conducts monetary policy based on the principle that the policy shall be aimed at achieving price stability, thereby contributing to the sound development of the national economy, and is responsible for maintaining financial system stability. The Bank aims to achieve price stability on a sustainable basis, given that there are various factors that affect prices in the short run.

The Bank recognizes that the inflation rate consistent with price stability on a sustainable basis will rise as efforts by a wide range of entities toward strengthening competitiveness and growth potential of Japan's economy make progress. Based on this recognition, the Bank sets the price stability target at 2 percent in terms of the year-on-year rate of change in the consumer price index.

Under the price stability target specified above, the Bank will pursue monetary easing and aim to achieve this target at the earliest possible time. Taking into consideration that it will take considerable time before the effects of monetary policy permeate the economy, the Bank will ascertain whether there is any significant risk to the sustainability of economic growth, including from the accumulation of financial imbalances.”

The Bank of Japan also provided explicit analysis of its view on price stability in a “Background note regarding the Bank’s thinking on price stability” (http://www.boj.or.jp/en/announcements/release_2013/data/rel130123a1.pdf http://www.boj.or.jp/en/announcements/release_2013/rel130123a.htm/). The Bank of Japan also amended “Principal terms and conditions for the Asset Purchase Program” (http://www.boj.or.jp/en/announcements/release_2013/rel130122a.pdf): “Asset purchases and loan provision shall be conducted up to the maximum outstanding amounts by the end of 2013. From January 2014, the Bank shall purchase financial assets and provide loans every month, the amount of which shall be determined pursuant to the relevant rules of the Bank.”

Financial markets in Japan and worldwide were shocked by new bold measures of “quantitative and qualitative monetary easing” by the Bank of Japan (http://www.boj.or.jp/en/announcements/release_2013/k130404a.pdf). The objective of policy is to “achieve the price stability target of 2 percent in terms of the year-on-year rate of change in the consumer price index (CPI) at the earliest possible time, with a time horizon of about two years” (http://www.boj.or.jp/en/announcements/release_2013/k130404a.pdf). The main elements of the new policy are as follows:

1. Monetary Base Control. Most central banks in the world pursue interest rates instead of monetary aggregates, injecting bank reserves to lower interest rates to desired levels. The Bank of Japan (BOJ) has shifted back to monetary aggregates, conducting money market operations with the objective of increasing base money, or monetary liabilities of the government, at the annual rate of 60 to 70 trillion yen. The BOJ estimates base money outstanding at “138 trillion yen at end-2012) and plans to increase it to “200 trillion yen at end-2012 and 270 trillion yen at end 2014” (http://www.boj.or.jp/en/announcements/release_2013/k130404a.pdf).
2. Maturity Extension of Purchases of Japanese Government Bonds. Purchases of bonds will be extended even up to bonds with maturity of 40 years with the guideline of extending the average maturity of BOJ bond purchases from three to seven years. The BOJ estimates the current average maturity of Japanese government bonds (JGB) at around seven years. The BOJ plans to purchase about 7.5 trillion yen per month (http://www.boj.or.jp/en/announcements/release_2013/rel130404d.pdf). Takashi Nakamichi, Tatsuo Ito and Phred Dvorak, wiring on “Bank of Japan mounts bid for revival,” on Apr 4, 2013, published in the Wall Street Journal (http://online.wsj.com/article/SB10001424127887323646604578401633067110420.html ), find that the limit of maturities of three years on purchases of JGBs was designed to avoid views that the BOJ would finance uncontrolled government deficits.
3. Seigniorage. The BOJ is pursuing coordination with the government that will take measures to establish “sustainable fiscal structure with a view to ensuring the credibility of fiscal management” (http://www.boj.or.jp/en/announcements/release_2013/k130404a.pdf).
4. Diversification of Asset Purchases. The BOJ will engage in transactions of exchange traded funds (ETF) and real estate investment trusts (REITS) and not solely on purchases of JGBs. Purchases of ETFs will be at an annual rate of increase of one trillion yen and purchases of REITS at 30 billion yen.
5. Bank Lending Facility and Growth Supporting Funding Facility. At the meeting on Feb 18, the Bank of Japan doubled the scale of these lending facilities to prevent their expiration in the near future (http://www.boj.or.jp/en/announcements/release_2014/k140218a.pdf).

Table VB-BOJF, Bank of Japan, Forecasts of the Majority of Members of the Policy Board, % Year on Year

Fiscal Year Date of Forecast	Real GDP	CPI All Items Less Fresh Food	Excluding Effects of Consumption Tax Hikes
2013
Jan 2014	+2.5 to +2.9 [+2.7]	+0.7 to +0.9 [+0.7]
Oct 2013	+2.6 to +3.0 [+2.7]	+0.6 to +1.0 [+0.7]
Jul 2013	+2.5 to +3.0 [+2.8]	+0.5 to +0.8 [+0.6]
2014
Jan 2014	+0.9 to 1.5 [+1.4]	+2.9 to +3.6 [+3.3]	+0.9 to +1.6 [+1.3]
Oct 2013	+0.9 to +1.5 [+1.5]	+2.8 to +3.6 [+3.3]	+0.8 to +1.6 [+1.3]
Jul 2013	+0.8 to +1.5 [+1.3]	+2.7 to +3.6 [+3.3]	+0.7 to +1.6 [+1.3]
2015
Jan 2014	+1.2 to +1.8 [+1.5]	+1.7 to +2.9 [+2.6]	+1.0 to +2.2 [+1.9]
Oct 2013	+1.3 to +1.8 [+1.5]	+1.6 to +2.9 [+2.6]	+0.9 to +2.2 [+1.9]
Jul 2013	+1.3 to +1.9 [+1.5]	+1.6 to +2.9 [+2.6]	+0.9 to +2.2 [+1.9]

Figures in brackets are the median of forecasts of Policy Board members

Source: Policy Board, Bank of Japan

http://www.boj.or.jp/en/mopo/outlook/gor1310b.pdf

Private-sector activity in Japan expanded with the Markit Composite Output PMI^™ Index decreasing from 54.1 in Jan to 52.0 in Feb, indicating slower growth (http://www.markiteconomics.com/Survey/PressRelease.mvc/6d69e0d951cf45b4a3f0e45809ba5b4c). Paul Smith, Director at Markit and author of the report, finds that the survey data suggest weakening conditions because of weather effects (http://www.markiteconomics.com/Survey/PressRelease.mvc/6d69e0d951cf45b4a3f0e45809ba5b4c). The Markit Business Activity Index of Services decreased from the record of 51.8 in Nov to 52.1 in Dec, 51.2 in Jan and 49.3 in Feb (http://www.markiteconomics.com/Survey/PressRelease.mvc/6d69e0d951cf45b4a3f0e45809ba5b4c). Paul Smith, Director at Markit and author of the report, finds concerns with the increase in sales taxes (http://www.markiteconomics.com/Survey/PressRelease.mvc/6d69e0d951cf45b4a3f0e45809ba5b4c). The Markit/JMMA Purchasing Managers’ Index^™ (PMI™), seasonally adjusted, decreased from 56.6 in Jan, which is the highest level since Feb 2006, to 55.5 in Feb (http://www.markiteconomics.com/Survey/PressRelease.mvc/18431136559044cfbbe099e870c915b5). New orders grew at a high rate for the twelfth consecutive month. New export orders increased for the sixth consecutive month at slow pace. Paul Smith, Economist at Markit and author of the report, finds improving manufacturing conditions with some concerns about the sales tax increase in Apr with price increases providing some compensation (http://www.markiteconomics.com/Survey/PressRelease.mvc/18431136559044cfbbe099e870c915b5).Table JPY provides the country data table for Japan.

Table JPY, Japan, Economic Indicators

Historical GDP and CPI	1981-2010 Real GDP Growth and CPI Inflation 1981-2010 Blog 8/9/11 Table 26
Corporate Goods Prices	Jan ∆% 0.1 12 months ∆% 2.4 Blog 2/16/14
Consumer Price Index	Jan NSA ∆% -0.2; Jan 12 months NSA ∆% 1.4 Blog 3/2/14
Real GDP Growth	IVQ2013 ∆%: 0.3 on IIIQ2013;  IVQ2013 SAAR 1.0; ∆% from quarter a year earlier: 2.7 % Blog 6/16/13 8/18/13 9/15/13 11/17/13 12/15/13 2/23/14
Employment Report	Jan Unemployed 2.38 million Change in unemployed since last year: minus 350 thousand Unemployment rate: 3.7 % Blog 3/2/14
All Industry Indices	Dec month SA ∆% -0.1 12-month NSA ∆% 2.2 Blog 2/23/14
Industrial Production	Jan SA month ∆%: 4.0 12-month NSA ∆% 10.6 Blog 3/2/14
Machine Orders	Total Dec ∆% -3.1 Private ∆%: -9.2 Dec ∆% Excluding Volatile Orders -15.7 Blog 2/16/14
Tertiary Index	Dec month SA ∆% -0.4 Dec 12 months NSA ∆% 0.9 Blog 2/16/14
Wholesale and Retail Sales	Jan 12 months: Total ∆%: 4.1 Wholesale ∆%: 3.9 Retail ∆%: 4.4 Blog 3/2/14
Family Income and Expenditure Survey	Jan 12-month ∆% total nominal consumption 2.8, real 1.1 Blog 3/2/14
Trade Balance	Exports Jan 12 months ∆%: 9.5 Imports Dec 12 months ∆% 25.0 Blog 2/23/14

Links to blog comments in Table JPY:

3/2/14 http://cmpassocregulationblog.blogspot.com/2014/03/financial-risks-slow-cyclical-united.html

2/23/14 http://cmpassocregulationblog.blogspot.com/2014/02/squeeze-of-economic-activity-by-carry.html

2/16/14 http://cmpassocregulationblog.blogspot.com/2014/02/theory-and-reality-of-cyclical-slow.html

12/15/13 http://cmpassocregulationblog.blogspot.com/2013/12/theory-and-reality-of-secular.html

11/17/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-unwinding-monetary-policy.html

9/15/13 http://cmpassocregulationblog.blogspot.com/2013/09/recovery-without-hiring-ten-million.html

8/18/13 http://cmpassocregulationblog.blogspot.com/2013/08/duration-dumping-and-peaking-valuations.html

VC China. China estimates an index of nonmanufacturing purchasing managers based on a sample of 1200 nonmanufacturing enterprises across the country (http://www.stats.gov.cn/english/pressrelease/t20121009_402841094.htm). Table CIPMNM provides this index and components. The total index increased from 55.7 in Mar 2012 to 58.0 in Mar 2012, decreasing to 53.9 in Aug 2013. The index decreased from 56.0 in Nov 2013 to 54.6 in Dec 2013, easing to 53.4 in Jan 2014. The total index increased to 55.0 in Feb 2014. The index of new orders increased from 52.2 in Jan 2012 to 54.3 in Dec 2012 but fell to 50.1 in May 2013, barely above the neutral frontier of 50.0. The index of new orders stabilized at 51.0 in Nov-Dec 2013, easing to 50.9 in Jan 2014. The index of new orders increased to 51.4 in Feb 2014.

Table CIPMNM, China, Nonmanufacturing Index of Purchasing Managers, %, Seasonally Adjusted

	Total Index	New Orders	Interm. Input Prices	Subs Prices	Exp
Feb 2014	55.0	51.4	52.1	49.0	59.9
Jan	53.4	50.9	54.5	50.1	58.1
Dec 2013	54.6	51.0	56.9	52.0	58.7
Nov	56.0	51.0	54.8	49.5	61.3
Oct	56.3	51.6	56.1	51.4	60.5
Sep	55.4	53.4	56.7	50.6	60.1
Aug	53.9	50.9	57.1	51.2	62.9
Jul	54.1	50.3	58.2	52.4	63.9
Jun	53.9	50.3	55.0	50.6	61.8
May	54.3	50.1	54.4	50.7	62.9
Apr	54.5	50.9	51.1	47.6	62.5
Mar	55.6	52.0	55.3	50.0	62.4
Feb	54.5	51.8	56.2	51.1	62.7
Jan	56.2	53.7	58.2	50.9	61.4
Dec 2012	56.1	54.3	53.8	50.0	64.6
Nov	55.6	53.2	52.5	48.4	64.6
Oct	55.5	51.6	58.1	50.5	63.4
Sep	53.7	51.8	57.5	51.3	60.9
Aug	56.3	52.7	57.6	51.2	63.2
Jul	55.6	53.2	49.7	48.7	63.9
Jun	56.7	53.7	52.1	48.6	65.5
May	55.2	52.5	53.6	48.5	65.4
Apr	56.1	52.7	57.9	50.3	66.1
Mar	58.0	53.5	60.2	52.0	66.6
Feb	57.3	52.7	59.0	51.2	63.8
Jan	55.7	52.2	58.2	51.1	65.3

Notes: Interm.: Intermediate; Subs: Subscription; Exp: Business Expectations

Source: National Bureau of Statistics of China

http://www.stats.gov.cn/english/

Chart CIPMNM provides China’s nonmanufacturing purchasing managers’ index. The index fell from 56.1 in Dec 2012 to 53.9 in Jun 2013. The index recovered to 56.3 in Oct 2013, decreasing marginally to 54.6 in Dec 2013. The index fell to 53.4 in Jan 2014, increasing to 55.0 in Feb 2014.

Chart CIPMNM, China, Nonmanufacturing Index of Purchasing Managers, Seasonally Adjusted

Source: National Bureau of Statistics of China

http://www.stats.gov.cn/english/

Table CIPMMFG provides the index of purchasing managers of manufacturing seasonally adjusted of the National Bureau of Statistics of China. The general index (IPM) rose from 50.5 in Jan 2012 to 53.3 in Apr 2012, falling to 49.2 in Aug 2012, rebounding to 50.6 in Dec 2012. The index fell to 50.1 in Jun 2013, barely above the neutral frontier at 50.0, recovering to 51.4 in Nov 2013 but falling to 51.0 in Dec 2013. The index fell to 50.5 in Jan 2014 and 50.2 in Feb 2014. The index of new orders fell from 57.2 in Apr 2012 to 52.0 in Dec 2012. The index of new orders fell from 54.5 in Nov 2013 to 53.9 in Dec 2013. The index fell to 53.0 in Jan 2014 and 52.6 in Feb 2014.

Table CIPMMFG, China, Manufacturing Index of Purchasing Managers, %, Seasonally Adjusted

	IPM	PI	NOI	INV	EMP	SDEL
Feb 2014	50.2	52.6	50.5	47.4	48.0	49.9
Jan	50.5	53.0	50.9	47.8	48.2	49.8
Dec 2013	51.0	53.9	52.0	47.6	48.7	50.5
Nov	51.4	54.5	52.3	47.8	49.6	50.6
Oct	51.4	54.4	52.5	48.6	49.2	50.8
Sep	51.1	52.9	52.8	48.5	49.1	50.8
Aug	51.0	52.6	52.4	48.0	49.3	50.4
Jul	50.3	52.4	50.6	47.6	49.1	50.1
Jun	50.1	52.0	50.4	47.4	48.7	50.3
May	50.8	53.3	51.8	47.6	48.8	50.8
Apr	50.6	52.6	51.7	47.5	49.0	50.8
Mar	50.9	52.7	52.3	47.5	49.8	51.1
Feb	50.1	51.2	50.1	49.5	47.6	48.3
Jan	50.4	51.3	51.6	50.1	47.8	50.0
Dec 2012	50.6	52.0	51.2	47.3	49.0	48.8
Nov	50.6	52.5	51.2	47.9	48.7	49.9
Oct	50.2	52.1	50.4	47.3	49.2	50.1
Sep	49.8	51.3	49.8	47.0	48.9	49.5
Aug	49.2	50.9	48.7	45.1	49.1	50.0
Jul	50.1	51.8	49.0	48.5	49.5	49.0
Jun	50.2	52.0	49.2	48.2	49.7	49.1
May	50.4	52.9	49.8	45.1	50.5	49.0
Apr	53.3	57.2	54.5	48.5	51.0	49.6
Mar	53.1	55.2	55.1	49.5	51.0	48.9
Feb	51.0	53.8	51.0	48.8	49.5	50.3
Jan	50.5	53.6	50.4	49.7	47.1	49.7

IPM: Index of Purchasing Managers; PI: Production Index; NOI: New Orders Index; EMP: Employed Person Index; SDEL: Supplier Delivery Time Index

Source: National Bureau of Statistics of China

http://www.stats.gov.cn/english/

China estimates the manufacturing index of purchasing managers on the basis of a sample of 820 enterprises (http://www.stats.gov.cn/english/pressrelease/t20121009_402841094.htm). Chart CIPMMFG provides the manufacturing index of purchasing managers. The index fell to 50.1 in Feb 2013 and in Jun 2013. The index decreased from 51.4 in Nov 2013 to 51.0 in Dec 2013. The index fell to 50.5 in Jan 2014 and 50.2 in Feb 2014.

Chart CIPMMFG, China, Manufacturing Index of Purchasing Managers, Seasonally Adjusted

Source: National Bureau of Statistics of China

http://www.stats.gov.cn/english/

Cumulative growth of China’s GDP in IVQ2013 relative to the same period in 2012 was 7.7 percent, as shown in Table VC-GDP. Secondary industry accounts for 43.9 percent of GDP in IVQ2013. In IVQ2013, industry alone accounts for 37.0 percent in IVQ2013 and construction with the remaining 6.9 percent in the four quarters of 2013. Tertiary industry accounts for 46.1 percent of cumulative GDP in IVQ2013 and primary industry for 10.0 percent. China’s growth strategy consisted of rapid increases in productivity in industry to absorb population from agriculture where incomes are lower (Pelaez and Pelaez, The Global Recession Risk (2007), 56-80). The bottom block of Table VC-GDP provides quarter-on-quarter growth rates of GDP and their annual equivalent. China’s GDP growth decelerated significantly from annual equivalent 10.4 percent in IIQ2011 to 7.4 percent in IVQ2011 and 5.7 percent in IQ2012, rebounding to 8.7 percent in IIQ2012, 8.2 percent in IIIQ2012 and 7.8 percent in IVQ2012. Annual equivalent growth in IQ2013 fell to 6.1 percent and to 7.4 percent in IIQ2013, rebounding to 9.1 percent in IIIQ2013. Annual equivalent growth was 7.4 percent in IVQ2013.

Table VC-GDP, China, Quarterly Growth of GDP, Current CNY 100 Million and Inflation Adjusted ∆%

Cumulative GDP IIIQ2013	Value Current CNY Billion	2013 Year-on-Year Constant Prices ∆%
GDP	56,884.5	7.7
Primary Industry	5,695.7	4.0
Farming	5,695.7	4.0
Secondary Industry	24,968.4	7.8
Industry	21,068.9	7.6
Construction	3899.5	9.5
Tertiary Industry	26,220.4	8.3
Transport, Storage, Post	2728.3	7.2
Wholesale, Retail Trades	5,567.2	10.3
Hotel & Catering Services	1149.4	5.3
Financial Intermediation	3353.5	10.1
Real Estate	3329.5	6.6
Other	10,092.5	7.7
Growth in Quarter Relative to Prior Quarter	∆% on Prior Quarter	∆% Annual Equivalent
2013
IVQ2013	1.8	7.4
IIIQ2013	2.2	9.1
IIQ2013	1.8	7.4
IQ2013	1.5	6.1
2012
IVQ2012	1.9	7.8
IIIQ2012	2.0	8.2
IIQ2012	2.1	8.7
IQ2012	1.4	5.7
2011
IVQ2011	1.8	7.4
IIIQ2011	2.2	9.1
IIQ2011	2.5	10.4
IQ2011	2.3	9.5

Source: National Bureau of Statistics of China http://www.stats.gov.cn/english/

Growth of China’s GDP in IVQ2013 relative to the same period in 2012 was 7.7 percent, as shown in Table VC-GDPA. Secondary industry accounts for 43.9 percent of GDP of which industry alone for 37.0 percent in cumulative IVQ2013 and construction with the remaining 6.9 percent in the four quarters of 2013. Tertiary industry accounts for 45.1 percent of GDP in the cumulative to IVQ2013 and primary industry for 10.0 percent. China’s growth strategy consisted of rapid increases in productivity in industry to absorb population from agriculture where incomes are lower (Pelaez and Pelaez, The Global Recession Risk (2007), 56-80). GDP growth decelerated from 12.1 percent in IQ2010 and 11.2 percent in IIQ2010 to 7.7 percent in IQ2013, 7.5 percent in IIQ2013 and 7.8 percent in IIIQ2013. GDP grew 7.7 percent in IVQ2013 relative to a year earlier and 1.8 percent relative to IIIQ2013, which is equivalent to 7.4 percent per year.

Table VC-GDPA, China, Growth Rate of GDP, ∆% Relative to a Year Earlier and ∆% Relative to Prior Quarter

	IQ 2013	IIQ 2013	IIIQ 2013	IVQ 2013
GDP	7.7	7.5	7.8	7.7
Primary Industry	3.4	3.0	3.4	4.0
Secondary Industry	7.8	7.6	7.8	7.8
Tertiary Industry	8.3	8.3	8.4	8.3
GDP ∆% Relative to a Prior Quarter	1.5	1.8	2.2	1.8
	IQ 2011	IIQ 2011	IIIQ 2011	IVQ 2011	IQ  2012	IIQ 2012	IIIQ 2012	IVQ 2012
GDP	9.7	9.5	9.1	8.9	8.1	7.6	7.4	7.9
Primary Industry	3.5	3.2	3.8	4.5	3.8	4.3	4.2	4.5
Secondary Industry	11.1	11.0	10.8	10.6	9.1	8.3	8.1	8.1
Tertiary Industry	9.1	9.2	9.0	8.9	7.5	7.7	7.9	8.1
GDP ∆% Relative to a Prior Quarter	2.3	2.5	2.2	1.8	1.4	2.1	2.0	1.9
	IQ 2010	IIQ 2010	IIIQ 2010	IVQ 2010
GDP	12.1	11.2	10.7	12.1
Primary Industry	3.8	3.6	4.0	3.8
Secondary Industry	14.5	13.3	12.6	14.5
Tertiary Industry	10.5	9.9	9.7	10.5

Source: National Bureau of Statistics of China http://www.stats.gov.cn/english/

Chart VC-GDP of the National Bureau of Statistics of China provides annual value and growth rates of GDP. China’s GDP growth in 2012 is still high at 7.8 percent but at the lowest rhythm in five years.

Chart VC-GDP, China, Gross Domestic Product, Million Yuan and ∆%, 2008-2012

Source: National Bureau of Statistics of China http://www.stats.gov.cn/english/

The HSBC Flash China Manufacturing Purchasing Managers’ Index^™ (PMI^™) compiled by Markit (http://www.markiteconomics.com/Survey/PressRelease.mvc/f7b00646382b4353a878a645cbbebf9c) is slowing. The overall Flash HSBC China Manufacturing PMI^™ decreased from 49.5 in Jan to 48.3 in Jan, which is the lowest in seven months, while the Flash HSBC China Manufacturing Output Index decreased from 50.8 in Jan to 49.2 in Feb, indicating moderate contraction. Hongbin Qu, Chief Economist, China and Co-Head of Asian Economic Research at HSBC, finds that the index is consistent with weakening manufacturing with policy required to maintain growth in the rest of the year (http://www.markiteconomics.com/Survey/PressRelease.mvc/f7b00646382b4353a878a645cbbebf9c). The HSBC China Services PMI^™, compiled by Markit, shows marginal deterioration in business activity in China with the HSBC Composite Output, combining manufacturing and services, decreasing from 50.8 in Jan to 49.8 in Feb, indicating standstill (http://www.markiteconomics.com/Survey/PressRelease.mvc/593829170f8f412a91d70e6be09de93a). Hongbin Qu, Chief Economist, China and Co-Head of Asian Economic Research at HSBC, finds need of policies to prevent decelerating growth (http://www.markiteconomics.com/Survey/PressRelease.mvc/593829170f8f412a91d70e6be09de93a). The HSBC Business Activity index decreased from 50.7 in Jan to 51.0 in Feb (http://www.markiteconomics.com/Survey/PressRelease.mvc/593829170f8f412a91d70e6be09de93a). Hongbin Qu, Chief Economist, China & Co-Head of Asian Economic Research at HSBC, finds that services could stabilize at low levels of activity (http://www.markiteconomics.com/Survey/PressRelease.mvc/593829170f8f412a91d70e6be09de93a). The HSBC Purchasing Managers’ Index^™ (PMI^™), compiled by Markit, increased marginally to 48.5 in Feb from 49.5 in Jan, indicating marginally deteriorating manufacturing (http://www.markiteconomics.com/Survey/PressRelease.mvc/0226a44496724665886d4d265e64cfb0). New export orders decreased moderately with moderate contraction of total new orders. Hongbin Qu, Chief Economist, China and Co-Head of Asian Economic Research at HSBC, finds soft manufacturing in China, posing risks to GDP growth (http://www.markiteconomics.com/Survey/PressRelease.mvc/0226a44496724665886d4d265e64cfb0). Table CNY provides the country data table for China.

Table CNY, China, Economic Indicators

Price Indexes for Industry	Jan 12-month ∆%: minus 1.6 Jan month ∆%: -0.1 Blog 2/16/14
Consumer Price Index	Jan month ∆%: 1.0 Jan 12 months ∆%: 2.5 Blog 2/16/14
Value Added of Industry	Dec month ∆%: 0.71 Jan-Dec 2013/Jan-Dec 2012 ∆%: 9.7 Dec 12-Month ∆%: 9.7 Blog 1/26/14
GDP Growth Rate	Year IVQ2013 ∆%: 7.7 Quarter IVQ2013 AE ∆%: 7.4 Blog 1/26/14
Investment in Fixed Assets	Total Jan-Dec 2013 ∆%: 19.6 Real estate development: 19.8 Blog 1/26/14
Retail Sales	Dec month ∆%: 1.24 Dec 12 month ∆%: 13.6 Jan-Dec ∆%: 13.1 Blog 1/26/14
Trade Balance	Jan balance $31.86 billion Exports 12M ∆% 10. Imports 12M ∆% 10.0 Cumulative Jan: $31.86 billion Blog 2/16/14

Links to blog comments in Table CNY:

2/16/14 http://cmpassocregulationblog.blogspot.com/2014/02/theory-and-reality-of-cyclical-slow.html

1/26/14 http://cmpassocregulationblog.blogspot.com/2014/01/capital-flows-exchange-rates-and.html

VD Euro Area. Table VD-EUR provides yearly growth rates of the combined GDP of the members of the European Monetary Union (EMU) or euro area since 1996. Growth was very strong at 3.3 percent in 2006 and 3.0 percent in 2007. The global recession had strong impact with growth of only 0.4 percent in 2008 and decline of 4.4 percent in 2009. Recovery was at lower growth rates of 2.0 percent in 2010 and 1.6 percent in 2011. EUROSTAT estimates growth of GDP of the euro area of minus 0.7 percent in 2012 and minus 0.4 percent in 2013 but 1.1 percent in 2014 and 1.7 percent in 2015.

Table VD-EUR, Euro Area, Yearly Percentage Change of Harmonized Index of Consumer Prices, Unemployment and GDP ∆%

Year	HICP ∆%	Unemployment %	GDP ∆%
1999	1.2	9.6	2.9
2000	2.2	8.7	3.8
2001	2.4	8.1	2.0
2002	2.3	8.5	0.9
2003	2.1	9.0	0.7
2004	2.2	9.3	2.2
2005	2.2	9.2	1.7
2006	2.2	8.5	3.3
2007	2.1	7.6	3.0
2008	3.3	7.6	0.4
2009	0.3	9.6	-4.4
2010	1.6	10.1	2.0
2011	2.7	10.1	1.6
2012	2.5	11.4	-0.7
2013*	1.4	12.1	-0.5
2014*			1.1
2015*			1.7

*EUROSTAT forecast Source: EUROSTAT

http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

The GDP of the euro area in 2012 in current US dollars in the dataset of the World Economic Outlook (WEO) of the International Monetary Fund (IMF) is $12,199.1 billion or 16.9 percent of world GDP of $72,216.4 billion (http://www.imf.org/external/pubs/ft/weo/2012/02/weodata/index.aspx). The sum of the GDP of France $2613.9 billion with the GDP of Germany of $3429.5 billion, Italy of $2014.1 billion and Spain $1323.5 billion is $9381.0 billion or 76.9 percent of total euro area GDP and 13.0 percent of World GDP. The four largest economies account for slightly more than three quarters of economic activity of the euro area. Table VD-EUR1 is constructed with the dataset of EUROSTAT, providing growth rates of the euro area as a whole and of the largest four economies of Germany, France, Italy and Spain annually from 1996 to 2011 with the estimate of 2012 and forecasts for 2013, 2014 and 2015 by EUROSTAT. The impact of the global recession on the overall euro area economy and on the four largest economies was quite strong. There was sharp contraction in 2009 and growth rates have not rebounded to earlier growth with exception of Germany in 2010 and 2011.

Table VD-EUR1, Euro Area, Real GDP Growth Rate, ∆%

	Euro Area	Germany	France	Italy	Spain
2015*	1.7	1.9	1.7	1.2	1.7
2014*	1.1	1.7	0.9	0.7	0.5
2013*	-0.5	0.4	0.2	-1.8	-1.3
2012	-0.7	0.7	0.0	-2.5	-1.6
2011	1.6	3.3	2.0	0.5	0.1
2010	2.0	4.0	1.7	1.7	-0.2
2009	-4.4	-5.1	-3.1	-5.5	-3.8
2008	0.4	1.1	-0.1	-1.2	0.9
2007	3.0	3.3	2.3	1.7	3.5
2006	3.3	3.7	2.5	2.2	4.1
2005	1.7	0.7	1.8	0.9	3.6
2004	2.2	1.2	2.5	1.7	3.3
2003	0.7	-0.4	0.9	0.0	3.1
2002	0.9	0.0	0.9	0.5	2.7
2001	2.0	1.5	1.8	1.9	3.7
2000	3.8	3.1	3.7	3.7	5.0
1999	2.9	1.9	3.3	1.5	4.7
1998	2.8	1.9	3.4	1.4	4.5
1997	2.6	1.7	2.2	1.9	3.9
1996	1.5	0.8	1.1	1.1	2.5

Source: EUROSTAT

http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

The Flash Eurozone PMI Composite Output Index of the Markit Flash Eurozone PMI^®, combining activity in manufacturing and services, decreased from 52.9 in Jan to 52.7 in Feb (http://www.markiteconomics.com/Survey/PressRelease.mvc/61e35865d2de4a309411277f211a1046). Chris Williamson, Chief Economist at Markit, finds that the Markit Flash Eurozone PMI index suggests that the index is consistent with growth of GDP as high as 0.5 percent in IQ2014 (http://www.markiteconomics.com/Survey/PressRelease.mvc/61e35865d2de4a309411277f211a1046). The Markit Eurozone PMI^® Composite Output Index, combining services and manufacturing activity with close association with GDP, increased from 52.9 in Jan to 53.3 in Feb, which is the second highest since the first half 2011 (http://www.markiteconomics.com/Survey/PressRelease.mvc/655b401c3aa2488f91f124a1d03ba66c). Chris Williamson, Chief Economist at Markit, finds growth of GDP at 0.4 to 0.5 percent in IQ2014 if Jan-Feb activity is sustained (http://www.markiteconomics.com/Survey/PressRelease.mvc/655b401c3aa2488f91f124a1d03ba66c). The Markit Eurozone Services Business Activity Index increased from 51.6 in Jan to 52.6 in Feb, which is a high in 32 months (http://www.markiteconomics.com/Survey/PressRelease.mvc/655b401c3aa2488f91f124a1d03ba66c). The Markit Eurozone Manufacturing PMI^® decreased to 53.2 in Feb from 54.0 in Jan (http://www.markiteconomics.com/Survey/PressRelease.mvc/cad8aed8211d4e59aaca92f8d31a36e9). New orders and export orders increased. Chris Williamson, Chief Economist at Markit, finds industrial growth in the euro area at a quarterly rate around 1.0 percent. (http://www.markiteconomics.com/Survey/PressRelease.mvc/cad8aed8211d4e59aaca92f8d31a36e9). Table EUR provides the data table for the euro area.

Table EUR, Euro Area Economic Indicators

GDP	IVQ2013 ∆% 0.3; IVQ2013/IVQ2012 ∆% 0.5 Blog 3/9/14
Unemployment	Jan 2014: 12.0 % unemployment rate; Jan 2014: 19.056 million unemployed Blog 3/2/14
HICP	Jan month ∆%: -1.1 12 months Jan ∆%: 0.8 Blog 3/2/14
Producer Prices	Euro Zone industrial producer prices Jan ∆%: -0.3 Jan 12-month ∆%: -1.4 Blog 3/9/14
Industrial Production	Dec month ∆%: -0.7; Dec 12 months ∆%: 0.5 Blog 2/16/14
Retail Sales	Jan month ∆%: 1.6 Jan 12 months ∆%: 1.3 Blog 3/9/14
Confidence and Economic Sentiment Indicator	Sentiment 101.2 Feb 2014 Consumer minus 12.7 Jan 2014 Blog 3/2/14
Trade	Jan-Dec 2013/Jan-Dec 2012 Exports ∆%: 0.8 Imports ∆%: -3.3 Dec 2013 12-month Exports ∆% 3.8 Imports ∆% 1.0 Blog 2/16/14

Links to blog comments in Table EUR:

3/2/14 http://cmpassocregulationblog.blogspot.com/2014/03/financial-risks-slow-cyclical-united.html

2/16/14 http://cmpassocregulationblog.blogspot.com/2014/02/theory-and-reality-of-cyclical-slow.html

Table VD-1 provides percentage changes of euro area real GDP in a quarter relative to the prior quarter. Real GDP fell 0.2 percent in IVQ2011, fell 0.1 in IQ2012 and fell in the final three quarters of 2012: 0.3 percent in IIQ2012, 0.2 percent in IIIQ2012 and 0.5 percent in IVQ2012. GDP fell 0.2 percent in IQ2013 and increased 0.3 percent in IIQ2013. Growth slowed at 0.1 percent in IIIQ2013. GDP increased 0.3 percent in IVQ2013. The global recession manifested in the euro area in five consecutive quarterly declines from IIQ2008 to IIQ2009. The strongest impact was contraction of 2.8 percent in IQ2009. Recovery began in IIIQ2009 with cumulative growth of 3.9 percent to IQ2011 or at the annual equivalent rate of 2.2 percent. Growth was much more vigorous from IVQ2003 to IQ2008.

Table VD-1, Euro Area, Real GDP, Percentage Change from Prior Quarter, Calendar and Seasonally and Working Day Adjusted ∆%

	IQ	IIQ	IIIQ	IVQ
2013	-0.2	0.3	0.1	0.3
2012	-0.1	-0.3	-0.2	-0.5
2011	0.8	0.0	0.1	-0.2
2010	0.4	0.9	0.4	0.5
2009	-2.8	-0.3	0.4	0.5
2008	0.6	-0.4	-0.6	-1.7
2007	0.8	0.5	0.6	0.4
2006	0.9	1.1	0.6	1.1
2005	0.2	0.7	0.6	0.7
2004	0.5	0.6	0.4	0.3
2003	-0.1	0.1	0.5	0.7
2002	0.2	0.6	0.3	0.1
2001	0.9	0.1	0.1	0.2
2000	1.3	0.9	0.5	0.7
1999	0.8	0.7	1.1	1.1

Source: EUROSTAT

http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

Table VD-2 provides percentage change in real GDP in the euro area in a quarter relative to the same quarter a year earlier. Growth rates were quite strong from 2004 to 2007. There were five consecutive quarters of sharp declines in GDP in a quarter relative to the same quarter a year earlier from IVQ2008 to IVQ2009 with sharp contractions of 5.5 percent in IQ2009, 5.3 percent in IIQ2009 and 4.4 percent in IIIQ2009. Growth rates decline in magnitude with 1.4 percent in IIIQ2011, 0.7 percent in IVQ211 and -0.2 percent in IQ2012 followed by contractions of 0.5 percent in IIQ2012, 0.7 percent in IIIQ2012 and 1.0 percent in IVQ2012. GDP contracted 1.2 percent in IQ2013 relative to a year earlier and contracted 0.6 percent in IIQ2013 relative to a year earlier. Euro area GDP contracted 0.3 percent in IIIQ2013 relative to a year earlier. The GDP of the euro area increased 0.5 percent in IVQ2013 relative to a year earlier.

Table VD-2, Euro Area, Real GDP Percentage Change in a Quarter Relative to Same Quarter a

Year Earlier, Seasonally and Working Day Adjusted ∆%

	IQ	IIQ	IIIQ	IV
2013	-1.2	-0.6	-0.3	0.5
2012	-0.2	-0.5	-0.7	-1.0
2011	2.7	1.8	1.4	0.7
2010	1.0	2.2	2.2	2.3
2009	-5.5	-5.3	-4.4	-2.3
2008	2.1	1.2	0.0	-2.1
2007	3.7	3.0	3.0	2.3
2006	2.9	3.4	3.4	3.8
2005	1.5	1.6	1.9	2.2
2004	1.8	2.2	2.2	1.8
2003	0.8	0.4	0.5	1.2
2002	0.5	1.0	1.2	1.1
2001	2.9	2.1	1.7	1.2
2000	4.3	4.4	3.8	3.3
1999	2.1	2.4	2.9	3.8

Source: EUROSTAT

http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

Table VD-3 provides growth of euro area real GDP in a quarter relative to the same quarter a year earlier not seasonally adjusted. GDP increased 0.1 percent in IIIQ2013 NSA relative to a year earlier and increased 0.4 percent in IVQ2013 relative to a year earlier. GDP fell 0.5 percent in IIQ2013 relative to a year earlier without seasonal adjustment and declined 1.8 percent in IQ2013 relative to a year earlier without seasonal adjustment. Growth rates in 2006 and 2007 were quite strong followed by sharp declines of 5.6 percent in IQ2009, 5.9 percent in IIQ2009 and 4.2 percent in IQ2009.

Table VD-3, Euro Area, Real GDP Percentage Change in a Quarter Relative to Same Quarter a Year Earlier, Not Seasonally Adjusted ∆%

	IQ	IIQ	IIIQ	IV
2013	-1.8	-0.5	0.1	0.4
2012	0.2	-0.9	-0.9	-1.1
2011	2.8	1.9	1.5	0.2
2010	1.1	2.4	2.2	2.1
2009	-5.6	-5.9	-4.2	-2.0
2008	1.7	1.6	0.5	-2.1
2007	3.5	3.1	3.0	2.4
2006	3.5	2.6	3.1	3.7
2005	1.0	2.1	1.9	1.8
2004	2.1	2.5	2.2	2.0
2003	1.0	0.1	0.5	1.2
2002	0.1	1.2	1.5	0.9
2001	2.8	2.0	1.7	1.5
2000	4.9	4.2	3.3	2.7
1999	2.2	2.6	2.8	3.8

Source: EUROSTAT

http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

Table VD-4 provides GDP growth in IVQ2013 and relative to the same quarter a year earlier with SAWDA (seasonal and working day adjustment) and NSA (not seasonally adjusted) for the euro zone, European Union, Japan and the US. The GDP of the euro zone increased 0.3 percent in IVQ2013 and increased 0.5 percent relative to a year earlier SWDA and 0.4 percent NSA for IVQ2013. The GDP of the European Union increased 0.4 percent in IVQ2013, increased 1.1 percent SWDA in IVQ2013 relative to a year earlier and increased 1.1 percent relative to a year earlier NSA in IVQ2013. Growth in IIIQ2013 was weak worldwide with somewhat stronger performance by the US but still insufficient to reduce unemployment and underemployment (Section I and earlier http://cmpassocregulationblog.blogspot.com/2014/02/financial-instability-rules.html) and motivate hiring (http://cmpassocregulationblog.blogspot.com/2014/02/theory-and-reality-of-cyclical-slow.html).

Table VD-4, Euro Zone, European Union, Japan and USA, Real GDP Growth

	∆% IVQ2013/ IIIQ2013 SAWDA	∆% IVQ2013/ IVQ2012 SWDA	∆% IVQ2013/ IVQ2012 NSA
Euro Zone	0.3	0.5	0.4
European Union	0.4	1.1	1.1
Germany	0.4	1.4	1.3
France	0.3	0.8	0.6
Netherlands	0.7	0.7	0.7
Finland	-0.3	-0.5	-0.6
Belgium	0.5	1.0	1.0
Portugal	0.5	1.6	-1.7**
Ireland**	1.5	1.7	1.7
Italy	0.1	-0.8	-1.6**
Greece	NA	-2.6***	-2.6
Spain	0.2	-0.2	-0.1
United Kingdom	0.7	2.7	1.2**
Japan	0.3	2.7	2.7
USA	0.8	2.7	NA

*SAWDA: Seasonally and Working Day Adjusted except UK, Japan and USA

**IIIQ2013 ***NSA

Source: EUROSTAT

http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

Advanced economies are experiencing weak demand. Table VD-5 provides month and 12-month percentage changes of the volume of retail sales in the euro zone from Jan 2011 to Jan 2014. Retail sales increased 1.6 percent in Jan 2014 and increased 1.3 percent in 12 months. The 12-month rates of growth became negative since Mar 2011 with exception of 0.6 percent in Apr 2011, 0.0 percent in Mar 2012 and 1.5 percent in Nov 2013. The lower part of Table VD-1 provides annual percentage changes of inflation-adjusted retail sales in the euro zone since 2001. Retail sales fell 0.6 percent in 2010 after falling 0.4 percent in 2009 and 1.8 percent in 2008 and fell again by 1.9 percent in 2011 and 2.6 percent in 2012. Retail sales fell 0.4 percent in 2013.

Table VD-5, Euro Zone, Volume of Retail Sales, Deflated ∆%

	Month ∆%	12-Month CA ∆%
Jan 2014	1.6	1.3
Dec 2013	-1.3	-0.4
Nov	1.1	1.5
Oct	-0.4	-0.4
Sep	-0.9	-0.2
Aug	0.6	-0.3
Jul	0.5	-0.9
Jun	-0.9	-1.6
May	1.2	-0.2
Apr	-0.1	-1.3
Mar	-0.2	-2.4
Feb	-0.1	-2.1
Jan	0.3	-2.0
Dec 2012	-0.1	-2.6
Nov	-0.2	-1.9
Oct	-0.2	-3.1
Sep	-1.5	-1.8
Aug	0.4	-0.7
Jul	-0.2	-1.4
Jun	0.3	-0.9
May	0.5	-0.6
Apr	-1.5	-3.5
Mar	0.2	0.0
Feb	0.0	-2.1
Jan	-0.2	-1.0
Dec 2011	0.3	-1.9
Nov	-0.8	-1.5
Oct	0.3	-0.8
Sep	-0.4	-1.4
Aug	-0.1	-0.3
Jul	0.1	-0.6
Jun	0.8	-0.9
May	-1.8	-1.9
Apr	1.2	0.6
Mar	-1.5	-1.5
Feb	0.7	1.2
Jan	-0.2	0.6
Dec ∆%
2013		-0.4
2012		-2.6
2011		-1.9
2010		-0.6
2009		-0.4
2008		-1.8
2007		-0.9
2006		2.3
2005		1.1
2004		2.3
2003		0.7
2002		-0.3
2001		1.9

Source: EUROSTAT

http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

Growth rates of retail sales of the euro zone by major segments are in Table VD-6. Total sales increased 1.6 percent in Jan 2014 and increased 1.3 percent in the 12 months ending in Jan 2014. Food sales increased 1.1 percent in Jan 2014 and fell 0.4 percent in 12 months and nonfood products increased 1.9 percent in Jan and increased 2.5 percent in 12 months. Sales of automotive fuel stores increased 1.5 percent in Jan and increased 2.9 percent in 12 months.

Table VD-6, Euro Zone, Volume of Retail Sales by Products, ∆%

Jan 2014	Month ∆%	12-Month ∆%
Total	1.6	1.3
Food, Drinks, Tobacco	1.1	-0.4
Nonfood Products ex Automotive Fuel	1.9	2.5
Automotive Fuel in Specialized Stores	1.5	2.9

Source: EUROSTAT

http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

Month and 12-month percentage rates of change of retail sales by member countries of the euro zone are shown in Table VD-7 for 2013. Retail sales are mixed throughout the euro zone. The 12-month percentage changes are positive for some members in Table VD-3 such as 3.2 percent for France, 1.0 percent for Germany, 2.9 percent Ireland and 6.6 percent for Portugal. The 12-month percentage change for the UK, which is not a member of the euro zone, was 4.9 percent. The European Union’s 12-month percentage change was 1.9 percent.

Table VD-7, Euro Zone, Volume of Retail Sales by Member Countries, ∆%

Jan 2014	Month ∆%	12-Month ∆%
Euro Zone	1.6	-1.3
Germany	2.5	1.0
France	1.2	3.2
Netherlands	0.0	-1.8*
Finland	1.7	0.0
Belgium	2.1	0.4
Portugal	6.7	6.6
Ireland	-1.0	2.9
Italy	-0.3*	-1.8*
Greece	-3.3*	-6.1*
Spain	NA	NA
UK	-1.5	4.9
European Union	0.9	1.9

*Dec 2013

Source: EUROSTAT

http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

VE Germany. Table VE-DE provides yearly growth rates of the German economy from 1992 to 2012, price adjusted chain-linked and price and calendar-adjusted chain-linked. Germany’s GDP fell 5.1 percent in 2009 after growing below trend at 1.1 percent in 2008. Recovery has been robust in contrast with other advanced economies. The German economy grew at 4.0 percent in 2010, 3.3 percent in 2011 and 0.7 percent in 2012. Growth decelerated to 0.4 percent in 2013.

The Federal Statistical Agency of Germany analyzes the fall and recovery of the German economy (http://www.destatis.de/jetspeed/portal/cms/Sites/destatis/Internet/EN/Content/Statistics/VolkswirtschaftlicheGesamtrechnungen/Inlandsprodukt/Aktuell,templateId=renderPrint.psml):

“The German economy again grew strongly in 2011. The price-adjusted gross domestic product (GDP) increased by 3.0% compared with the previous year. Accordingly, the catching-up process of the German economy continued during the second year after the economic crisis. In the course of 2011, the price-adjusted GDP again exceeded its pre-crisis level. The economic recovery occurred mainly in the first half of 2011. In 2009, Germany experienced the most serious post-war recession, when GDP suffered a historic decline of 5.1%. The year 2010 was characterised by a rapid economic recovery (+3.7%).”

Table VE-DE, Germany, GDP Year ∆%

	Price Adjusted Chain-Linked	Price- and Calendar-Adjusted Chain Linked
2013	0.4	0.5
2012	0.7	0.9
2011	3.3	3.4
2010	4.0	3.8
2009	-5.1	-5.1
2008	1.1	0.8
2007	3.3	3.4
2006	3.7	3.9
2005	0.7	0.8
2004	1.2	0.7
2003	-0.4	-0.4
2002	0.0	0.0
2001	1.5	1.6
2000	3.1	3.3
1999	1.9	1.8
1998	1.9	1.7
1997	1.7	1.8
1996	0.8	0.8
1995	1.7	1.8
1994	2.5	2.5
1993	-1.0	-1.0
1992	1.9	1.5

Source: Statistisches Bundesamt Deutschland (Destatis)

https://www.destatis.de/EN/PressServices/Press/pr/2014/02/PE14_048_811.html

https://www.destatis.de/EN/PressServices/Press/pr/2013/08/PE13_278_811.html https://www.destatis.de/EN/PressServices/Press/pr/2013/11/PE13_381_811.html

https://www.destatis.de/EN/PressServices/Press/pr/2014/01/PE14_016_811.html

https://www.destatis.de/DE/PresseService/Presse/Pressekonferenzen/2014/BIP2013/Pressebroschuere_BIP2013.html

The Flash Germany Composite Output Index of the Markit Flash Germany PMI^®, combining manufacturing and services, increased from 55.5 in Jan to 56.1 in Feb for a 32-month high. The index of manufacturing output reached 657.6 in Feb, declining from a 33-month high of 60.4 in Jan, while the index of services increased to 55.4 in Feb from 53.1 in Jan. The overall Flash Germany Manufacturing PMI^® decreased from 56.5 in Jan, which is a 32-month high, to 54.7 in Feb (http://www.markiteconomics.com/Survey/PressRelease.mvc/b85e0a161b9f4998be8a2378f57ab4af). New export work volumes increased at the second fastest pace in about three years with business originating in the US, Asia, Middle East, Poland and Russia. Oliver Kolodseike, Economist at Markit, finds expansion of Germany’s private sector at the fastest rate in 32 months (http://www.markiteconomics.com/Survey/PressRelease.mvc/b85e0a161b9f4998be8a2378f57ab4af). The Markit Germany Composite Output Index of the Markit Germany Services PMI^®, combining manufacturing and services with close association with Germany’s GDP, increased from 55.5 in Dec to 56.4 in Feb (http://www.markiteconomics.com/Survey/PressRelease.mvc/4eb457ed6b1d48efba316e6bc71a1b0f). Oliver Kolodseike, Senior Economist at Markit and author of the report, finds improving activity by the German private sector (http://www.markiteconomics.com/Survey/PressRelease.mvc/4eb457ed6b1d48efba316e6bc71a1b0f). The Germany Services Business Activity Index increased from 53.1 in Jan to 55.9 in Feb (http://www.markiteconomics.com/Survey/PressRelease.mvc/4eb457ed6b1d48efba316e6bc71a1b0f). The Markit/BME Germany Purchasing Managers’ Index^® (PMI^®), showing close association with Germany’s manufacturing conditions, decreased from 5.5 in Jan to 54.8 in Feb (http://www.markiteconomics.com/Survey/PressRelease.mvc/83b8290ad0914aa099bc0641cc917a1b). New export orders increased for the eighth consecutive month with demand from the US and emerging markets. Oliver Kolodseike, Senior Economist at Markit and author of the report, finds continuing growth with strength in new orders (http://www.markiteconomics.com/Survey/PressRelease.mvc/83b8290ad0914aa099bc0641cc917a1b).Table DE provides the country data table for Germany.

Table DE, Germany, Economic Indicators

GDP	IVQ2013 0.4 ∆%; IV/Q2013/IVQ2012 ∆% 1.3 2013/2012: 0.4% GDP ∆% 1992-2013 Blog 8/26/12 5/27/12 11/25/12 2/24/13 5/19/13 5/26/13 8/18/13 8/25/13 11/17/13 11/24/13 1/26/14 2/16/14 3/2/14
Consumer Price Index	Jan month NSA ∆%: -0.6 Jan 12-month NSA ∆%: 1.3 Blog 2/16/14
Producer Price Index	Jan month ∆%: -0.1 CSA, minus 0.4 12-month NSA ∆%: -1.1 Blog 2/23/14
Industrial Production	MFG Jan month CSA ∆%: 0.3 12-month NSA: 3.0 Blog 3/9/14
Machine Orders	MFG Jan month ∆%: 1.2 Jan 12-month ∆%: 7.1 Blog 3/9/14
Retail Sales	Nov Month ∆% 0.8 12-Month ∆% 1.1 Blog 2/2/14
Employment Report	Unemployment Rate SA Jan 5.0% Blog 3/2/14
Trade Balance	Exports Dec 12-month NSA ∆%: 4.6 Imports Dec 12 months NSA ∆%: 2.0 Exports Dec month CSA ∆%: minus 0.9; Imports Dec month SA minus 0.6 Blog 2/9/14

Links to blog comments in Table DE:

3/2/14 http://cmpassocregulationblog.blogspot.com/2014/03/financial-risks-slow-cyclical-united.html

2/23/14 http://cmpassocregulationblog.blogspot.com/2014/02/squeeze-of-economic-activity-by-carry.html

2/16/14 http://cmpassocregulationblog.blogspot.com/2014/02/theory-and-reality-of-cyclical-slow.html

2/9/14 http://cmpassocregulationblog.blogspot.com/2014/02/financial-instability-rules.html

2/2/14 http://cmpassocregulationblog.blogspot.com/2014/02/mediocre-cyclical-united-states.html

1/26/14 http://cmpassocregulationblog.blogspot.com/2014/01/capital-flows-exchange-rates-and.html

11/24/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-zero-interest-rates-world.html

11/17/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-unwinding-monetary-policy.html

8/25/13 http://cmpassocregulationblog.blogspot.com/2013/08/interest-rate-risks-duration-dumping.html

8/18/13 http://cmpassocregulationblog.blogspot.com/2013/08/duration-dumping-and-peaking-valuations.html

http://cmpassocregulationblog.blogspot.com/2013/07/twenty-nine-million-unemployed-or.html

5/26/13 http://cmpassocregulationblog.blogspot.com/2013/05/united-states-commercial-banks-assets.html

The production industries index of Germany in Table VE-1 shows increase of 0.4 percent in Dec 2012 and decrease of 9.4 percent in the 12 months ending in Dec 2012. The index decreased 0.5 percent in Jan 2013 and 1.4 percent in 12 months and increased 0.6 percent in Feb 2013, declining 5.0 percent in 12 months. In Mar 2013, the production index of Germany increased 0.6 percent and fell 9.0 percent in 12 months. The production index jumped 1.0 percent in Apr 2013 and 7.3 percent in 12 months. In May 2013, the production index fell 1.3 percent and 4.5 percent in 12 months. The production index of Germany increased 2.1 percent in Jun 2013 and fell 0.6 percent in 12 months. In Jul 2013, the production industries index fell 0.9 percent and increased 1.9 percent in 12 months. The production industries index increased 1.5 percent in Aug 2013 and fell 2.7 percent in 12 months. In Sep 2013, the production index fell 0.7 percent and increased 4.2 percent in 12 months. In Oct 2013, the production index of Germany fell 1.1 percent and increased 1.2 percent in 12 months. The index of production industries increased 2.4 percent in Nov 2013 and 0.4 percent in 12 months. The index of production industries increased 0.1 percent in Dec 2013 and increased 5.7 percent in 12 months. The production industries index increased 0.8 percent in Jan 2014 and 3.6 percent in 12 months. Germany’s production industries suffered decline of 7.3 percent in Dec 2008 relative to Dec 2007 and decline of 2.3 percent in 2009. Recovery was vigorous with 17.1 percent in the 12 months ending in Dec 2010. The first quarter of 2011 was quite strong when the German economy outperformed the other advanced economies. The performance of Germany’s production industries from 2002 to 2006 was vigorous with average rate of 4.5 percent. Data for the production industries index of Germany fluctuate sharply from month to month and in 12-month rates.

Table VE-1, Germany, Production Industries, Month and 12-Month ∆%

	12-Month ∆% NSA	Month ∆% Calendar SA
Jan 2014	3.6	0.8
Dec 2013	5.7	0.1
Nov	0.4	2.4
Oct	1.2	-1.1
Sep	4.2	-0.7
Aug	-2.7	1.5
Jul	1.9	-0.9
Jun	-0.6	2.1
May	-4.5	-1.3
Apr	7.3	1.0
Mar	-9.0	0.6
Feb	-5.0	0.6
Jan	-1.4	-0.5
Dec 2012	-9.4	0.4
Nov	-2.9	-0.3
Oct	4.1	-1.5
Sep	-6.7	1.0
Aug	-0.6	-0.6
Jul	2.4	1.2
Jun	4.2	-0.8
May	-6.3	1.4
Apr	-0.6	-2.3
Mar	-0.1	2.3
Feb	2.4	-0.6
Jan	4.8	0.9
Dec 2011	2.0	-1.5
Nov	3.9	-0.1
Oct	0.1	1.1
Sep	4.5	-1.6
Aug	10.2	-1.0
Jul	5.8	3.1
Jun	-0.8	-1.5
May	18.2	0.8
Apr	5.3	-0.2
Mar	9.8	0.7
Feb	15.8	1.1
Jan	15.1	1.4
Dec 2010	17.1
Dec 2009	-2.3
Dec 2008	-7.3
Dec 2007	-0.1
Dec 2006	2.5
Dec 2005	4.9
Dec 2004	5.3
Dec 2003	5.1
Dec 2002	2.0
Dec 2001	-8.8
Dec 2000	0.2
Dec 1999	6.4
Average ∆% per Year
Dec 1995 to Dec 2013	1.5
Dec 1995 to Dec 2000	2.7
Dec 1995 to Dec 2006	2.2
Dec 2002 to Dec 2006	4.5

Source: Statistiche Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Table VE-2 provides monthly percentage changes of the German production industries index by components from Jun 2013 to Jan 2014. The index increased 0.8 percent in Jan 2014 with increases of 0.3 percent in industry, 0.3 percent in manufacturing, 0.8 percent in capital goods and 1.1 percent in energy. The index increased 2.4 percent in Nov 2013 with increases in all segments. The index fell 1.1 percent in Oct 2013 with all segments declining with exception of 0.7 percent for intermediate goods and 0.4 percent for nondurable goods.

Table VE-2, Germany, Production Industries, Industry and Components, Month ∆%

	Jan 2014	Dec 2013	Nov	Oct	Sep	Aug	Jul	Jun
Production Industries	0.8	0.1	2.4	-1.1	-0.7	1.5	-0.9	2.1
Industry	0.3	0.2	3.0	-1.1	-1.0	2.2	-1.4	1.9
Mfg	0.3	0.2	3.0	-1.1	-1.0	2.2	-1.4	1.9
Intermediate Goods	0.2	0.8	1.2	0.7	0.3	0.2	-0.5	0.3
Capital Goods	0.8	-0.7	5.1	-2.8	-2.5	4.6	-2.6	3.7
Durable Goods	-2.5	0.4	1.9	-3.2	1.7	-2.2	-2.8	9.2
Nondurable Goods	-0.9	1.6	1.2	0.4	-0.6	0.9	-0.1	-0.8
Energy	1.1	-2.4	-1.0	-2.0	1.9	-1.9	0.3	4.5

Seasonally Calendar Adjusted

Source: Source: Statistisches Bundesamt Deutschland (Destatis

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Table VE-3 provides 12-month unadjusted percentage changes of industry and components in Germany. There were percentage declines of 12-month rates in the production index of Germany and all segments in the four months from Dec 2012 to Mar 2013 with exception of nondurables in Jan 2013 and energy in Mar 2013. There is sharp recovery in Apr 2013 with growth of manufacturing by 8.1 percent and capital goods by 11.2 percent. All segments show declines in 12 months in May 2013. There are increases in the 12 months ending in Jun of 0.9 percent in capital goods and 2.5 percent in durable goods. All segments increased in Jul 2013. All segments fell in Aug 2013 with sharp declines. There is strong recovery in Sep with high rates of increase. Many segments increased in the 12 months ending in Oct 2013 with 1.5 percent growth in manufacturing and 1.6 percent in capital goods. All segments increased in Nov 2013 with 1.1 percent in manufacturing and 1.5 percent in capital goods. All segments increased in Dec 2013. Most segments increased in Jan 2014 with exception of declines for durable goods and nondurable goods. Percentage declines in 12 months are quite sharp in Dec 2012 with most percentage changes negative around two-digits. Although there are sharp fluctuations in the data, there is suggestion of deceleration that would be expected from much higher earlier rates. The deceleration is quite evident in single-digit percentage changes from Sep 2011 to Dec 2012 relative to high double-digit percentage changes in Jan-Mar 2011. There are multiple negative 12-month percentage changes across many segments. Growth rates in the recovery from the global recession from IVQ2007 to IIQ2009 were initially very vigorous in comparison with the growth rates before the contraction that are shown in the bottom part of Table VE-3.

Table VE-3, Germany, Industry and Components, 12-Month ∆% Unadjusted

	IND	MFG	INTG	CG	DG	NDG	EN
2014
Jan	3.1	3.0	3.2	4.7	-2.4	-0.3	1.4
2013
Dec	6.1	6.0	7.4	6.1	5.5	3.7	-0.3
Nov	1.1	1.1	1.1	1.5	0.0	-0.3	-1.5
Oct	1.6	1.5	2.5	1.6	0.0	-1.0	-0.9
Sep	4.6	4.5	4.2	5.6	6.1	2.1	0.4
Aug	-2.7	-2.8	-3.5	-1.6	-7.2	-2.9	-3.4
Jul	1.5	1.4	1.9	0.4	4.0	2.9	2.2
Jun	-0.3	-0.3	-1.8	0.9	2.5	-1.1	-0.9
May	-4.4	-4.4	-3.5	-5.8	-10.4	-1.3	-5.3
Apr	8.2	8.1	4.6	11.2	9.3	8.7	-1.8
Mar	-8.8	-8.7	-8.1	-9.6	-9.3	-7.9	0.5
Feb	-4.8	-4.9	-5.6	-4.7	-6.4	-2.9	-12.0
Jan	-0.7	-0.6	-1.3	-1.8	-2.0	4.7	-4.2
2012
Dec	-9.6	-9.4	-11.8	-8.5	-12.5	-7.0	-2.4
Nov	-3.1	-3.1	-3.9	-2.7	-7.6	-1.2	0.7
Oct	3.9	3.8	2.8	4.0	0.7	7.0	3.2
Sep	-7.6	-7.5	-8.8	-7.1	-11.2	-5.2	4.0
Aug	-1.1	-1.0	-3.2	0.3	0.4	0.7	4.5
Jul	2.0	2.0	0.3	4.6	-2.4	-0.7	2.2
Jun	3.8	3.7	1.9	6.5	7.2	0.3	6.7
May	-7.0	-6.8	-7.5	-6.1	-10.6	-7.7	4.0
Apr	-1.1	-1.1	-2.0	1.9	-5.3	-5.9	3.7
Mar	-0.5	-0.4	-3.1	2.8	-6.2	-2.3	-0.8
Feb	3.2	3.3	0.9	7.3	-0.1	-2.3	5.9
Jan	5.6	5.6	3.0	10.4	4.7	0.1	-3.3
2011
Dec	1.5	1.4	1.8	1.3	0.2	1.4	-9.2
Nov	4.6	4.5	2.9	8.1	2.3	-1.0	-5.8
Oct	0.6	0.7	-0.3	3.2	-2.3	-3.4	-6.1
Sep	5.7	5.7	4.6	9.2	3.4	-0.8	-6.1
Aug	12.4	12.2	9.3	20.4	4.8	1.4	-3.0
Jul	7.9	7.8	5.0	13.7	6.8	0.1	-5.7
Jun	0.5	0.5	0.2	2.3	-10.2	-2.1	-4.7
May	21.5	21.2	17.9	28.3	20.8	12.8	-7.3
Apr	7.5	7.5	6.1	11.1	4.6	1.6	-5.5
Mar	11.2	11.2	10.8	15.0	8.6	2.0	2.8
Feb	17.3	17.1	16.3	23.1	10.1	6.3	-0.4
Jan	17.2	16.9	17.5	23.1	9.9	3.6	-2.6
2010
Dec	17.6	17.6	14.8	25.9	8.5	1.7	2.6
Nov	13.9	13.9	12.9	19.2	7.7	3.9	3.5
Oct	9.9	9.9	9.7	14.0	6.3	0.8	2.5
Sep	9.8	9.5	12.2	10.1	8.3	2.6	2.1
Aug	16.9	17.0	19.3	19.9	18.3	6.9	1.3
Jul	9.0	8.9	13.2	8.7	7.4	0.8	1.9
Jun	16.4	16.2	20.8	16.1	19.7	5.1	-2.8
May	13.1	13.3	20.0	12.0	11.2	1.4	11.1
Apr	14.9	14.9	21.7	15.5	8.8	0.2	9.4
Mar	14.3	14.5	20.4	12.3	11.8	5.8	4.2
Feb	6.8	7.4	10.6	6.5	7.9	-1.0	3.7
Jan	0.4	0.9	6.3	-3.8	0.8	-3.0	0.8
Dec 2010	17.6	17.6	14.8	25.9	8.5	1.7	2.6
Dec 2009	-3.2	-3.1	3.3	-9.9	-0.1	1.1	3.7
Dec 2008	-7.6	-7.4	-14.3	-5.4	-11.2	3.7	-9.0
Dec 2007	0.0	-0.3	-0.6	2.5	-10.0	-2.7	1.6
Dec 2006	3.2	3.1	5.2	2.3	8.6	-0.9	-5.3
Dec 2005	5.8	5.9	3.5	9.0	3.2	2.1	0.6
Dec 2004	5.3	5.5	7.7	3.4	0.8	5.7	9.6
Dec 2003	5.5	5.3	5.5	6.4	1.7	4.4	0.3
Dec 2002	3.7	3.3	5.4	3.4	-5.9	2.3	-2.6

Note: IND: Industry; MFG: Manufacturing; INTG: Intermediate Goods; CG: Capital Goods; DG: Durable Goods; NDG: Nondurable Goods; EN: Energy

Source: Statistisches Bundesamt Deutschland (Destatis)

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Broader perspective since 2005 is provided by Chart VE-1 of the Statistisches Bundesamt Deutschland, Federal Statistical Agency of Germany. The index of production industries not seasonally adjusted rises by more than one third between 2003 and 2008 with sharp fluctuations and then collapses during the global recession in 2008. Recovery has been in a steep upward trajectory that has recovered at the more recent peaks the losses during the contraction. Recovery stalled recently.

Chart VE-1, Germany, Production Industries, Not Adjusted, 2010=100

Source: Statistiche Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

More detail is provided by Chart VE-2 of the Statistiche Bundesamt Deutschland, or Federal Statistical Agency of Germany, with the unadjusted production industries index and trend from 2009 to 2013. There could be some flattening in recent months probably leading into stagnation, mild downturn and probable recovery as depicted by trend.

Chart VE-2, Germany, Production Industries, Not Adjusted, 2010=100

Source: Statistiche Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Table VE-4 provides month and 12-month rates of growth of manufacturing in Germany from Dec 2010 to Jan 2014. There are fluctuations in both monthly rates and in the past 12 months. In Jan 2013, manufacturing fell 0.7 percent and decreased 0.6 percent in 12 months. Manufacturing increased 0.8 percent in Feb 2013, declining 4.9 percent in 12 months. In Mar 2013, manufacturing increased 0.4 percent but fell 8.7 percent in 12 months. There is strong recovery in Apr 2013 with growth of 0.8 percent and 8.1 percent in 12 months. Manufacturing fell 1.3 percent in May 2013 and declined 4.4 percent in 12 months. Recovery is strong in Jun 2013 with growth of 1.9 percent in the month but decline of 0.3 percent in 12 months. Manufacturing fell 1.4 percent in Jul 2013 and increased 1.4 percent in 12 months. In Aug 2013, manufacturing increased 2.2 percent and fell 2.8 percent in 12 months. Manufacturing fell 1.0 percent in Sep 2013 and increased 4.5 percent in 12 months. Manufacturing increased 3.0 percent in Nov 2013 and 1.1 percent in 12 months. In Dec 2013, manufacturing increased 0.2 percent and increased 6.0 percent in 12 months. Manufacturing increased 0.3 percent in Jan 2014 and 3.0 percent in 12 months.

Table VE-4, Germany, Manufacturing Month and 12-Month ∆%

	12-Month ∆% NSA	Month ∆% SA and Calendar Adjusted
Jan 2014	3.0	0.3
Dec 2013	6.0	0.2
Nov	1.1	3.0
Oct	1.5	-1.1
Sep	4.5	-1.0
Aug	-2.8	2.2
Jul	1.4	-1.4
Jun	-0.3	1.9
May	-4.4	-1.3
Apr	8.1	0.8
Mar	-8.7	0.4
Feb	-4.9	0.8
Jan	-0.6	-0.7
Dec 2012	-9.4	1.0
Nov	-3.1	-0.1
Oct	3.8	-1.6
Sep	-7.5	-1.4
Aug	-1.0	-0.6
Jul	2.0	1.7
Jun	3.7	-1.2
May	-6.8	1.9
Apr	-1.1	-2.1
Mar	-0.4	1.1
Feb	3.3	0.2
Jan	5.6	0.7
Dec 2011	1.4	-1.6
Nov	4.5	-0.4
Oct	0.7	1.0
Sep	5.7	-1.7
Aug	12.2	-1.1
Jul	7.8	3.4
Jun	0.5	-1.5
May	21.2	1.0
Apr	7.5	0.3
Mar	11.2	0.7
Feb	17.1	1.3
Jan	16.9	0.1
Dec 2010	17.6	1.3

Source: Statistisches Bundesamt Deutschland (Destatis)

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Chart VE-3 of the Statistisches Bundesamt Deutschland, or Federal Statistical Office of Germany, provides the manufacturing index of Germany from 2009 to 2014. Manufacturing was already flattening in 2007 and fell sharply in 2008 to the beginning of 2010. Manufacturing grew sharply in the initial phase of recovery but has flattened in recent months as revealed by the trend that may be turning upward.

Chart VE-3, Germany, Production Index, Manufacturing, Not Adjusted Index and Trend, 2010=100

Source: Statistiche Bundesamt Deutschland https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Table VE-5 provides month and 12-month rates of growth of new orders of manufacturing in Germany from Jan 2010 to Jan 2014. There are fluctuations in both monthly rates and in the past 12 months. Table VE-5 reveals strong fluctuations in an evident deceleration of total orders for industry of Germany with recent improvement. Total orders for manufacturing increased 1.2 percent in Jan 2014 and increased 7.1 percent in 12 months. There is the same behavior for total, foreign and domestic orders with decline in 12-month rates from two-digit levels to single digits and negative changes. An important aspect of Germany is that the bulk of orders is domestic or from other European countries while foreign orders have been growing rapidly. There is weakening world trade affecting export economies. As in other countries, data on orders for manufacturing are highly volatile. Most 12-month percentage changes from Jan 2012 to Sep 2012 in Table VE-5 are negative largely because of the unusual strength of the Germany economy in the beginning of 2011 but more recently because of slowing world economy in 2012-2013.

Table VE-5, Germany, Volume of Orders Received in Manufacturing, Total, Domestic and Foreign, ∆%  

	Total 12 M	Total M	Foreign 12 M	Foreign M	Home 12 M	Home M
2014
Jan	7.1	1.2	10.3	1.0	3.2	1.6
2013
Dec	8.2	-0.2	10.1	0.5	5.3	-1.2
Nov	4.1	2.4	6.5	2.3	1.2	2.6
Oct	2.0	-2.2	2.1	-2.4	1.9	-1.9
Sep	10.8	3.1	13.2	6.3	7.8	-0.9
Aug	0.1	-0.2	-0.7	-2.0	1.1	2.1
Jul	5.3	-2.0	6.3	-3.2	4.1	-0.2
Jun	4.6	4.5	7.8	5.2	0.3	3.5
May	-3.7	-0.6	-1.9	0.4	-6.1	-1.8
Apr	5.7	-1.8	7.3	-1.0	3.5	-2.9
Mar	-5.9	2.1	-4.9	2.5	-7.3	1.8
Feb	-3.1	2.1	-2.0	2.0	-4.6	2.1
Jan	-1.0	-1.5	0.5	-2.6	-2.7	0.2
2012
Dec	-9.1	1.2	-6.7	1.8	-12.6	0.2
Nov	-0.9	-2.6	2.4	-4.4	-5.1	0.0
Oct	4.5	3.7	7.0	6.2	1.3	0.4
Sep	-8.9	-1.7	-6.6	-2.5	-11.7	-0.6
Aug	-4.4	-1.0	-2.1	-0.3	-7.1	-1.9
Jul	-1.6	0.9	0.6	1.2	-4.2	0.5
Jun	-4.5	-2.5	-6.4	-2.8	-1.7	-2.0
May	-11.0	1.0	-3.7	2.4	-18.8	-0.9
Apr	-3.9	-1.9	-4.4	-2.8	-3.1	-0.7
Mar	-2.2	2.4	-1.2	3.3	-3.3	1.4
Feb	-4.3	0.3	-4.7	1.1	-3.8	-0.7
Jan	-2.6	-1.6	-4.6	-2.8	-0.2	-0.1
2011
Dec	0.0	2.3	-0.3	4.7	0.5	-0.6
Nov	-4.8	-2.8	-8.2	-5.0	-0.3	0.0
Oct	0.1	1.2	2.1	2.4	-2.1	-0.1
Sep	2.2	-3.0	1.9	-3.4	2.6	-2.3
Aug	7.1	-1.0	5.2	0.0	9.4	-2.3
Jul	4.9	-1.9	4.6	-5.8	5.4	3.2
Jun	3.5	-0.7	7.8	8.2	-2.0	-10.6
May	23.1	2.7	16.0	-3.6	31.8	10.8
Apr	6.7	1.9	9.6	2.4	3.0	1.1
Mar	9.8	-3.2	12.3	-3.3	6.9	-3.1
Feb	21.5	0.7	24.1	0.0	18.4	1.7
Jan	22.5	4.2	26.1	4.1	18.2	4.3
2010
Dec	21.8	-2.7	26.8	-3.8	15.4	-1.3
Nov	21.4	5.6	27.1	8.9	15.0	1.7
Oct	14.2	0.1	18.2	-0.5	10.0	0.9
Sep	13.9	-0.9	15.6	-2.8	11.9	1.5
Aug	22.2	2.2	29.7	4.3	14.5	-0.3
Jul	14.1	-0.5	21.4	-0.5	6.4	-0.6
Jun	27.6	2.2	30.6	2.7	24.2	1.7
May	24.8	0.0	29.6	0.9	19.4	-1.1
Apr	29.9	3.1	34.0	3.3	25.7	2.9
Mar	29.4	4.9	32.9	4.9	25.8	4.8
Feb	24.0	-0.2	28.7	0.2	18.6	-0.7
Jan	17.0	4.1	23.8	4.8	9.8	3.3
Dec 2009	9.1	-1.7	10.5	-2.6	7.3	-0.5
Dec 2008	-28.3	-6.7	-31.5	-9.5	-23.7	-2.9
Dec 2007	7.1	-0.9	9.1	-2.0	4.4	0.2
Dec 2006	2.8	0.8	3.4	0.5	2.2	1.1
Dec 2005	5.0	-0.5	10.4	-1.1	-1.4	0.3
Dec 2004	12.7	6.5	13.0	8.5	12.7	4.9
Dec 2003	10.7	2.4	16.4	5.4	5.1	-0.8
Dec 2002	-0.2	-3.4	-0.8	-6.6	0.2	-0.3
Average ∆% 2003-2007	7.6		10.4		4.5
Average ∆% 2003-2012	2.3		3.9		0.3

Notes: AE: Annual Equivalent; M: Month; M: Calendar and seasonally adjusted; 12 M: Non-adjusted Source: Statistisches Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Orders for capital goods of Germany are shown in Table VE-6. Total capital goods orders increased 0.5 percent in Jan 2014 and increased 9.1 percent in 12 months. Domestic orders increased 2.5 percent in Jan and foreign orders decreased 0.6 percent. There has been deceleration from 2010 and early 2011 with growth rates falling from two digit levels to single digits, and multiple negative changes with recent improvement. An important aspect of Germany’s economy shown in Tables VE-5 and VE-6 is the success in increasing the competitiveness of its economic activities as shown by rapid growth of orders for industry after the recession of 2001 in the period before the global recession beginning in late 2007. Germany adopted fiscal and labor market reforms to increase productivity.

Table VE-6, Germany, Volume of Orders Received of Capital Goods Industries, Total, Foreign and Domestic, ∆%

	Total 12 M	Total M	Foreign 12 M	Foreign M	Domestic 12 M	Domestic M
2014
Jan	9.1	0.5	12.6	-0.6	3.4	2.5
2013
Dec	10.3	1.0	13.8	3.0	3.4	-2.5
Nov	6.5	3.6	8.7	3.8	2.4	3.5
Oct	1.6	-4.9	1.5	-5.6	1.5	-3.8
Sep	14.5	5.2	16.9	9.7	10.1	-2.2
Aug	3.4	-0.5	1.7	-3.3	5.8	4.3
Jul	6.8	-3.6	8.6	-5.0	4.0	-0.9
Jun	8.7	8.0	13.3	8.9	1.1	6.6
May	-3.6	-0.8	-1.1	1.0	-7.9	-4.1
Apr	5.6	-2.3	6.5	-2.4	3.9	-2.1
Mar	-6.1	1.7	-4.6	2.6	-8.5	0.2
Feb	-0.7	3.0	1.6	2.4	-4.3	4.0
Jan	1.3	-2.0	3.6	-2.6	-2.3	-1.0
2012
Dec	-7.7	2.4	-4.6	2.6	-13.3	1.8
Nov	-0.7	-3.9	3.1	-5.6	-6.5	-0.6
Oct	4.6	4.7	6.3	6.8	2.1	1.1
Sep	-7.5	-0.4	-4.8	-0.7	-11.6	0.0
Aug	-4.6	-2.4	-2.6	-1.5	-7.4	-3.8
Jul	-0.3	1.3	1.2	1.9	-2.7	0.4
Jun	-7.1	-2.9	-9.9	-3.5	-1.9	-1.7
May	-12.0	1.0	-2.8	2.1	-23.9	-0.7
Apr	-3.3	-3.2	-4.2	-3.9	-1.7	-1.9
Mar	2.2	5.1	3.3	7.2	0.2	1.5
Feb	-5.9	1.2	-7.0	1.1	-4.2	1.3
Jan	-3.7	-3.6	-6.5	-4.1	1.0	-2.9
2011
Dec	1.2	2.8	-0.1	4.2	3.5	0.7
Nov	-6.5	-3.4	-10.5	-6.7	0.7	2.1
Oct	3.1	2.6	6.2	4.5	-2.0	-0.7
Sep	2.9	-2.8	2.2	-3.5	4.0	-1.8
Aug	6.7	-0.7	4.5	0.3	10.6	-2.4
Jul	7.2	-5.7	6.4	-9.5	8.8	1.4
Jun	9.1	0.3	13.3	12.5	2.0	-16.0
May	27.5	4.9	17.7	-4.3	43.5	20.4
Apr	11.0	3.9	14.1	5.2	6.3	1.7
Mar	12.0	-6.0	14.4	-5.7	8.5	-6.5
Feb	29.3	2.5	32.5	0.8	24.8	5.4
Jan	26.8	3.8	32.8	4.4	17.7	2.8
2010
Dec	27.4	-5.1	31.2	-6.8	21.1	-1.9
Nov	30.4	9.7	37.0	13.9	20.1	2.9
Oct	20.5	-0.6	24.9	-1.9	14.3	1.7
Sep	18.2	-1.7	20.3	-3.6	14.7	1.7
Aug	27.5	5.0	40.0	7.0	11.5	1.7
Jul	14.1	-1.7	28.1	-1.7	-2.5	-1.8
Jun	32.0	3.0	38.7	4.3	22.1	0.7
May	26.2	1.7	36.6	1.8	12.8	1.5
Apr	31.0	3.1	41.4	4.1	18.1	1.7
Mar	25.8	6.3	33.8	7.1	15.7	5.0
Feb	21.2	-1.1	31.3	-0.1	8.3	-2.4
Jan	17.0	4.4	29.6	3.0	2.8	6.9
Dec 2009	8.1	-1.2	13.6	-1.5	0.3	-1.0
Dec 2008	-32.2	-7.2	-36.8	-10.0	-24.5	-3.6
Dec 2007	9.4	-0.6	11.6	-2.3	6.1	2.2
Dec 2006	3.5	2.2	3.9	2.9	2.9	1.2
Dec 2005	1.8	-2.1	9.7	-2.5	-8.4	-1.6
Dec 2004	19.5	11.2	18.6	12.2	20.6	9.7
Dec 2003	11.7	2.1	17.2	5.0	5.4	-1.6
Dec 2002	-2.8	-4.3	-3.7	-8.1	-1.8	0.2
Average ∆% 2003-2007	9.0		12.1		4.9
Average ∆% 2003-2012	3.0		4.7		0.5

Notes: AE: Annual Equivalent; M: Month; M: Calendar and seasonally-adjusted; 12 M: Non-adjusted

Source: Statistisches Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Chart VE-4 of the German Statistisches Bundesamt Deutschland shows the sharp upward trend of total orders in manufacturing before the global recession. There is also an obvious upward trend in the recovery from the recession with Germany’s economy being among the most dynamic in the advanced economies until the slowdown beginning in the final months of 2011 and what could be stationary series from late 2011 into 2012 but risk of decline in the final segment in 2013.

Chart VE-4, Germany, Volume of Total Orders in Manufacturing, Non-Adjusted, 2005=100

Source:  Statistisches Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Chart VE-5 shows non-adjusted total orders in manufacturing and trend. There was sharp recovery from the global recession with subsequent decline. Trend reversed upwardly.

Chart VE-5, Germany, Volume of Total Orders in Manufacturing and Trend, Non-Adjusted, 2005=100

Source: Statistisches Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

VF France. Table VF-FR provides growth rates of GDP of France with the estimates of Institut National de la Statistique et des Études Économiques (INSEE). The long-term rate of GDP growth of France from IVQ1949 to IVQ2012 is quite high at 3.2 percent. France’s growth rates were quite high in the four decades of the 1950s, 1960, 1970s and 1980s with an average growth rate of 4.0 percent compounding the average rates in the decades and discounting to one decade. The growth impulse diminished with 1.9 percent in the 1990s and 1.7 percent from 2000 to 2007. The average growth rate from 2000 to 2012, using fourth quarter data, is 1.0 percent because of the sharp impact of the global recession from IVQ2007 to IIQ2009. The growth rate from 2000 to 2012 is 1.0 percent. Cobet and Wilson (2002) provide estimates of output per hour and unit labor costs in national currency and US dollars for the US, Japan and Germany from 1950 to 2000 (see Pelaez and Pelaez, The Global Recession Risk (2007), 137-44). The average yearly rate of productivity change from 1950 to 2000 was 2.9 percent in the US, 6.3 percent for Japan and 4.7 percent for Germany while unit labor costs in USD increased at 2.6 percent in the US, 4.7 percent in Japan and 4.3 percent in Germany. From 1995 to 2000, output per hour increased at the average yearly rate of 4.6 percent in the US, 3.9 percent in Japan and 2.6 percent in Germany while unit labor costs in US fell at minus 0.7 percent in the US, 4.3 percent in Japan and 7.5 percent in Germany. There was increase in productivity growth in the G7 in Japan and France in the second half of the 1990s but significantly lower than the acceleration of 1.3 percentage points per year in the US. Lucas (2011May) compares growth of the G7 economies (US, UK, Japan, Germany, France, Italy and Canada) and Spain, finding that catch-up growth with earlier rates for the US and UK stalled in the 1970s.

Table VF-FR, France, Average Growth Rates of GDP Fourth Quarter, 1949-2012

Period	Average ∆%
1949-2013	3.2
2000-2013	1.0
2000-2012	1.0
2000-2007	1.7
1990-1999	1.9
1980-1989	2.5
1970-1979	3.8
1960-1969	5.7
1950-1959	4.2

Source: Institut National de la Statistique et des Études Économiques

http://www.insee.fr/en/themes/info-rapide.asp?id=26&date=20140214

The Markit Flash France Composite Output Index decreased from 48.9 in Jan to 47.6 in Feb for a two-month low (http://www.markiteconomics.com/Survey/PressRelease.mvc/585c6448d40f4edc9370242b2832df48). Jack Kennedy, Senior Economist at Markit and author of the report, finds continuing economic weakness in the French private sector with favorable growth in manufacturing but moderate increase in new export orders (http://www.markiteconomics.com/Survey/PressRelease.mvc/585c6448d40f4edc9370242b2832df48). The Markit France Composite Output Index, combining services and manufacturing with close association with French GDP, decreased from 48.9 in Jan to 47.9 in Feb, indicating faster contraction (http://www.markiteconomics.com/Survey/PressRelease.mvc/27f0badb834f41eaad07e33201a393ba). Jack Kennedy, Senior Economist at Markit and author of the France Services PMI^®, finds continuing weakness with marginally improving confidence (http://www.markiteconomics.com/Survey/PressRelease.mvc/27f0badb834f41eaad07e33201a393ba). The Markit France Services Activity index decreased from 48.9 in Jan to 47.9 in Feb (http://www.markiteconomics.com/Survey/PressRelease.mvc/27f0badb834f41eaad07e33201a393ba). The Markit France Manufacturing Purchasing Managers’ Index^® increased to 49.7 in Feb from 49.3 in Jan for the highest reading in four months (http://www.markiteconomics.com/Survey/PressRelease.mvc/7c80a28d4c7b44918b8ffc8e952f27b5). Jack Kennedy, Senior Economist at Markit and author of the France Manufacturing PMI^®, finds stabilizing manufacturing conditions (http://www.markiteconomics.com/Survey/PressRelease.mvc/7c80a28d4c7b44918b8ffc8e952f27b5). Table FR provides the country data table for France.

Table FR, France, Economic Indicators

CPI	Jan month ∆% -0.6 12 months ∆%: 0.7 2/23/14
PPI	Jan month ∆%: -0.6 Jan 12 months ∆%: -1.2 Blog 3/2/14
GDP Growth	IVQ2013/IIIQ2013 ∆%:0.3 IVQ2013/IVQ2012 ∆%: 0.8 Blog 3/31/13 5/19/12 6/30/13 9/29/13 11/17/13 12/29/13 2/16/14
Industrial Production	Dec ∆%: Manufacturing 0.0 12-Month ∆%: Manufacturing 0.5 Blog 2/16/14
Consumer Spending	Manufactured Goods Jan ∆%: -1.5 Dec 12-Month Manufactured Goods ∆%: 0.6 Blog 3/2/14
Employment	Unemployment Rate: IVQ2013 9.8% Blog 3/9/13
Trade Balance	Jan Exports ∆%: month -1.8, 12 months -0.8 Jan Imports ∆%: month -0.3, 12 months 0.1 Blog 3/9/14
Confidence Indicators	Historical average 100 Feb Mfg Business Climate 100 Blog 3/2/14

Links to blog comments in Table FR:

3/2/14 http://cmpassocregulationblog.blogspot.com/2014/03/financial-risks-slow-cyclical-united.html

2/23/14 http://cmpassocregulationblog.blogspot.com/2014/02/squeeze-of-economic-activity-by-carry.html

2/16/14 http://cmpassocregulationblog.blogspot.com/2014/02/theory-and-reality-of-cyclical-slow.html

2/9/14 http://cmpassocregulationblog.blogspot.com/2014/02/financial-instability-rules.html

12/29/13 http://cmpassocregulationblog.blogspot.com/2013/12/collapse-of-united-states-dynamism-of.html

11/17/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-unwinding-monetary-policy.html

9/29/13 http://cmpassocregulationblog.blogspot.com/2013/09/mediocre-and-decelerating-united-states.html

6/30/13 http://cmpassocregulationblog.blogspot.com/2013/06/tapering-quantitative-easing-policy-and.html

5/19/13 http://cmpassocregulationblog.blogspot.com/2013/05/word-inflation-waves-squeeze-of.html

The number of unemployed in France rose from 1.986 million in IV2007, for a rate of unemployment of 7.1 percent, to 2.788 million in IVQ2013, for a rate of unemployment of 9.8 percent, as shown in Table VF-1. At the same time, the rate of employment fell from 64.7 percent in IV2007 to 64.1 percent in IVQ2013. 

Table VF-1, France, Metropolitan France, Employment Rate, Unemployed and Unemployment Rate, Millions and %

	Unemployed Millions	Unemployed Percent	Employment Rate
IVQ2013	2.788	9.8	64.1
IIIQ2013	2.829	9.9	64.1
IIQ2013	2.845	9.9	64.0
IQ2013	2.840	9.9	63.9
IVQ2012	2.796	9.8	64.1
IIIQ2012	2.681	9.4	64.0
IIQ2012	2.647	9.3	64.0
IQ2012	2.584	9.1	63.9
IVQ2011	2.541	9.0	63.9
IIIQ2011	2.487	8.8	63.9
IIQ2011	2.439	8.6	64.0
IQ2011	2.461	8.7	63.9
IVQ2010	2.496	8.8	63.9
IIIQ2010	2.513	8.9	64.0
IIQ2010	2.507	8.9	64.0
IQ2010	2.544	9.0	64.0
IVQ2009	2.585	9.2	63.8
IIIQ2009	2.479	8.8	63.9
IIQ2009	2.482	8.8	64.3
IQ2009	2.298	8.2	64.4
IVQ2008	2.074	7.4	64.9
IIIQ2008	1.989	7.1	64.9
IIQ2008	1.939	7.0	64.9
IQ2008	1.884	6.8	65.0
IV2007	1.986	7.1	64.7
IIIQ2007	2.128	7.7	64.4
IIQ2007	2.156	7.8	64.2
IQ2007	2.233	8.1	64.0
IVQ2006	2.207	8.0	64.0
IVQ2005	2.376	8.7	63.6
IVQ2004	2.320	8.5	63.8
IVQ2003	2.265	8.4	63.9
IVQ2002	2.045	7.6
IVQ2001	1.974	7.5
IVQ2000	2.017	7.7
IVQ1999	2.363	9.1
IVQ1995	2.441	9.6
IVQ1990	1.873	7.6
IVQ1985	2.086	8.5
IVQ1980	1.272	5.3
IVQ1975	0.812	3.6

Source: Institut National de la Statistique et des Études Économiques

http://www.insee.fr/en/themes/info-rapide.asp?id=14&date=20140306

Chart VF-1 of the Institut National de la Statistique et des Études Économiques of France provides an excellent view of the unemployment rate in France. The rate of unemployment rose from 2003 to 2006 and then fell sharply in 2007. The global recession caused sharp increase in the French rate of unemployment that has declined from the peak, stabilized at a high level and is climbing again.

Chart VF-1, France, Unemployment Rate International Labor Organization Criterion, Seasonally Adjusted Average over Quarter, Percent

Source: Institut National de la Statistique et des Études Économiques

http://www.insee.fr/en/themes/info-rapide.asp?id=14&date=20140306

France has been running a trade deficit fluctuating around €5,000 million as shown in Table VF-2. Exports decreased 1.9 percent in Jan 2014 while imports decreased 0.3 percent. The trade deficit increased from revised €5213 million in Dec 2013 to €5732 million in Jan 2014.

Table VF-2, France, Exports, Imports and Trade Balance, € Millions 

	Exports	Imports	Trade Balance
Jan 2014	36,286	42,018	-5,732
Dec 2013	36,944	42,157	-5,213
Nov	35,651	41,377	-5,726
Oct	36,391	41,226	-4,835
Sep	36,512	42,294	-5,782
Aug	36,913	41,074	-5,161
Jul	36,450	41,780	-5,330
Jun	36,022	40,918	-4,896
May	35,903	41,626	-5,723
Apr	38,331	42,009	-3,678
Mar	36,103	40,671	-4,568
Feb	35,691	41,503	-5,812
Jan	36,581	41,978	-5,397
Dec 2012	37,109	42,800	-5,691
Dec 2011	35,888	41,335	-5,447
Dec 2010	33,740	39,422	-5,682

Source: France, Direction générale des douanes et droits indirects

http://lekiosque.finances.gouv.fr/AppChiffre/Portail_default.asp

Table VF-3 provides month and 12-month percentage changes of France’s exports and imports. Exports decreased 1.8 percent in Jan 2014 and decreased 0.8 percent in the 12 months ending in Jan 2014. Imports decreased 0.3 percent in Jan 2014 and decreased 0.1 percent in 12 months. Growth of exports and imports has fluctuated in 2011, 2012 and 2013 because of price surges of commodities and raw materials. Weak economic conditions worldwide also influence trade performance.

Table VF-3, France, Exports and Imports, Month and 12-Month ∆%

	Exports Month ∆%	Exports 12-Month ∆%	Imports Month ∆%	Imports 12-Month ∆%
Jan 2014	-1.8	-0.8	-0.3	0.1
Dec 2013	3.6	-0.4	1.9	-1.5
Nov	-2.0	-2.8	0.4	-0.1
Dec 2012		3.4		3.5
Dec 2011		6.4		4.9
Dec 2010		13.2		14.6
Dec 2009		-9.5		-1.9
Dec 2008		-6.9		-10.8
Dec 2007		5.8		7.9
Dec 2006		6.2		6.6
Dec 2005		11.8		15.6
Dec 2004		-3.7		5.8
Dec 2003		7.1		1.6

Source: France, Direction générale des douanes et droits indirects

http://lekiosque.finances.gouv.fr/AppChiffre/Portail_default.asp

Annual data for France’s exports, imports and trade balance are provided in Table VF-4. France’s trade balance deteriorated sharply from 2007 to 2011 with the deficit increasing from €42,494 million in 2007 to €74,293 million in 2011. Annual growth rates of exports have not been sufficiently high to compensate for growth of imports driven in part by commodity price increases. In 2012, the trade deficit declined to €67,297 million with growth of exports of 3.1 percent and of imports of 1.2 percent. The trade deficit declined to €61,204 in 2013 with decline of exports of 1.3 percent and of 2.3 percent for imports.

Table VF-4, France, Exports, Imports and Balance Year € Millions and ∆%

	Exports € Millions	∆%	Imports € Millions	∆%	Balance € Millions
Jan 2014 12 Months	435,464		496,641		-61,177
Year
2013	435,618	-1.3	496,822	-2.3	-61,204
2012	441,420	3.1	508,717	1.2	-67,297
2011	428,258	8.4	502,551	12.3	-74,293
2010	395,039	14.0	447,483	14.2	-52,444
2009	346,481	-17.0	391,872	-17.3	-45,391
2008	417,636	2.7	473,853	5.5	-56,217
2007	406,487	3.0	448,981	5.8	-42,494
2006	394,621	9.5	424,549	10.4	-29,928
2005	360,376	4.4	384,588	9.6	-24,212
2004	345,256	5.4	350,996	7.0	-5,740
2003	327,653		327,884		-231

Source: France, Direction générale des douanes et droits indirects

http://lekiosque.finances.gouv.fr/AppChiffre/Portail_default.asp

VG Italy. Table VG-IT provides percentage changes in a quarter relative to the same quarter a year earlier of Italy’s expenditure components in chained volume measures. GDP has been declining at sharper rates from minus 0.6 percent in IVQ2011 to minus 3.0 percent in IVQ2012, minus 2.5 percent in IQ2013, minus 2.2 percent in IIQ2013 and minus 1.8 percent in IIIQ2013. The aggregate demand components of consumption and gross fixed capital formation (GFCF) have been declining at faster rates. The rates of decline of GDP, consumption and GFCF were somewhat milder in IIIQ2013, IIQ2013 than in IQ2013 and the final three quarters of 2012.

Table VG-IT, Italy, GDP and Expenditure Components, Chained Volume Measures, Quarter ∆% on Same Quarter Year Earlier

	GDP	Imports	Consumption	GFCF	Exports
2013
IVQ	-0.8
IIIQ	-1.9	-1.2	-1.5	-5.1	0.0
IIQ	-2.3	-4.7	-2.5	-5.8	0.2
IQ	-2.6	-4.8	-2.6	-7.3	-0.6
2012
IVQ	-3.0	-6.9	-4.0	-8.1	0.8
IIIQ	-2.8	-7.5	-4.1	-8.7	1.8
IIQ	-2.6	-7.3	-3.6	-8.8	2.1
IQ	-1.7	-8.2	-3.4	-8.1	2.8
2011
IVQ	-0.6	-6.8	-2.0	-3.8	3.5
IIIQ	0.5	0.5	-1.0	-2.4	6.0
IIQ	1.1	3.7	0.4	-0.7	7.5
IQ	1.4	9.1	0.7	0.6	11.0
2010
IVQ	2.3	15.6	1.1	1.3	13.4
IIIQ	1.8	13.2	1.3	2.4	12.1
IIQ	1.8	13.4	0.8	0.9	12.0
IQ	0.9	7.0	1.0	-2.4	7.1
2009
IVQ	-3.5	-6.3	0.2	-8.2	-9.3
IIIQ	-5.0	-12.2	-0.8	-12.6	-16.4
IIQ	-6.6	-17.9	-1.4	-13.6	-21.4
IQ	-6.9	-17.2	-1.8	-12.4	-22.8
2008
IVQ	-3.0	-8.2	-0.9	-8.3	-10.3
IIIQ	-1.9	-5.0	-0.8	-4.5	-3.9
IIQ	-0.2	-0.1	-0.3	-1.5	0.4
IQ	0.5	1.7	0.1	-1.0	2.9

GFCF: Gross Fixed Capital Formation

Source: Istituto Nazionale di Statistica

http://www.istat.it/it/archivio/106657

The Markit/ADACI Business Activity Index increased from 49.4 in Jan to 52.9 in Feb (http://www.markiteconomics.com/Survey/PressRelease.mvc/6b17493de9e44c38ab7dff3365122111). Phil Smith, Economist at Markit and author of the Italy Services PMI^®, finds the index suggesting strong growth of services with the highest rate of increase of new orders in about four years (http://www.markiteconomics.com/Survey/PressRelease.mvc/6b17493de9e44c38ab7dff3365122111). The Markit/ADACI Purchasing Managers’ Index^® (PMI^®), decreased from 53.1 in Jan to 52.3 in Feb for continuing growth (http://www.markiteconomics.com/Survey/PressRelease.mvc/e8afa393e01a401f969fdefd9c391ea0). New export orders grew around the trend of the fastest rate in 32 months in Nov and Dec and continued growing in Feb 2014. Phil Smith, Economist at Markit and author of the Italian Manufacturing PMI^®, finds continuing growth with new export orders from neighbor countries (http://www.markiteconomics.com/Survey/PressRelease.mvc/e8afa393e01a401f969fdefd9c391ea0). Table IT provides the country data table for Italy.

Table IT, Italy, Economic Indicators

Consumer Price Index	Feb month ∆%: -0.1 Feb 12-month ∆%: 0.5 Blog 3/2/14
Producer Price Index	Jan month ∆%: -0.2 Jan 12-month ∆%: -1.7 Blog 3/9/14
GDP Growth	IVQ2013/IIIQ2013 SA ∆%: 0.1 IVQ2013/IVQ2012 NSA ∆%: minus 0.8 Blog 3/17/13 6/16/13 8/11/13 9/15/13 11/17/13 12/15/13 2/16/14
Labor Report	Jan 2014 Participation rate 63.6% Employment ratio 55.3% Unemployment rate 12.9% Youth Unemployment 42.4% Blog 3/2/14
Industrial Production	Dec month ∆%: -0.9 12 months CA ∆%: -0.7 Blog 2/16/14
Retail Sales	Dec month ∆%: -0.3 Dec 12-month ∆%: -2.6 Blog 3/2/13
Business Confidence	Mfg Feb 99.1, Oct 97.4 Construction Feb 77.1, Oct 80.9 Blog 3/2/14
Trade Balance	Balance Dec SA €3617 million versus Nov €3034 Exports Dec month SA ∆%: 5.1; Imports Dec month ∆%: 3.6 Exports 12 months Dec NSA ∆%: 4.9 Imports 12 months NSA ∆%: 0.6 Blog 2/23/14

Links to blog comments in Table IT:

3/2/14 http://cmpassocregulationblog.blogspot.com/2014/03/financial-risks-slow-cyclical-united.html

2/23/14 http://cmpassocregulationblog.blogspot.com/2014/02/squeeze-of-economic-activity-by-carry.html

2/16/14 http://cmpassocregulationblog.blogspot.com/2014/02/theory-and-reality-of-cyclical-slow.html

12/15/13 http://cmpassocregulationblog.blogspot.com/2013/12/theory-and-reality-of-secular.html

11/17/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-unwinding-monetary-policy.html

9/15/13 http://cmpassocregulationblog.blogspot.com/2013/09/recovery-without-hiring-ten-million.html

8/11/13 http://cmpassocregulationblog.blogspot.com/2013/08/recovery-without-hiring-loss-of-full.html

6/16/13 http://cmpassocregulationblog.blogspot.com/2013/06/recovery-without-hiring-seven-million.html

3/17/13 http://cmpassocregulationblog.blogspot.com/2013/03/recovery-without-hiring-ten-million.html

VH United Kingdom. Annual data in Table VH-UK show the strong impact of the global recession in the UK with decline of GDP of 5.2 percent in 2009 after dropping 0.8 percent in 2008. Recovery of 1.7 percent in 2010 is relatively low in comparison with annual growth rates in 2007 and earlier years. Growth was only 1.1 percent in 2011 and 0.3 percent in 2012. Growth increased to 1.9 percent in 2013. The bottom part of Table VH-UK provides average growth rates of UK GDP since 1948. The UK economy grew at 2.6 percent per year on average between 1948 and 2013, which is relatively high for an advanced economy. The growth rate of GDP between 2000 and 2007 is higher at 3.0 percent. Growth in the current cyclical expansion has been only at 1.0 percent as advanced economies struggle with weak internal demand and world trade. GDP in 2013 was lower by 1.2 percent relative to 2007.

Table VH-UK, UK, Gross Domestic Product, ∆%

	∆% on Prior Year
1998	3.6
1999	2.9
2000	4.4
2001	2.2
2002	2.3
2003	3.9
2004	3.2
2005	3.2
2006	2.8
2007	3.4
2008	-0.8
2009	-5.2
2010	1.7
2011	1.1
2012	0.3
2013	1.8
Average Growth Rates ∆% per Year
1948-2013	2.6
1950-1959	2.7
1960-1969	3.3
1970-1979	2.5
1980-1989	3.2
1990-1999	2.9
2000-2007	3.0
2007-2012*	-3.0
2007-2013*	-1.3
2000-2013	1.5

*Absolute change from 2007 to 2012

Source: UK Office for National Statistics

http://www.ons.gov.uk/ons/rel/naa2/second-estimate-of-gdp/q4-2013/index.html

The Business Activity Index of the Markit/CIPS UK Services PMI^® decreased from 58.3 in Jan to 58.2 in Feb, which is still close to high historical levels and above long-term trend (http://www.markiteconomics.com/Survey/PressRelease.mvc/9996492c13d04da5b922b471ceb3bc33). Chris Williamson, Chief Economist at Markit, finds the combined indices consistent with the UK economy growing at 0.7 percent in IQ2014 (http://www.markiteconomics.com/Survey/PressRelease.mvc/9996492c13d04da5b922b471ceb3bc33). The Markit/CIPS UK Manufacturing Purchasing Managers’ Index^® (PMI^®) increased to 56.9 in Feb from 56.6 in Jan with job creation at the highest pace in 33 months (http://www.markiteconomics.com/Survey/PressRelease.mvc/e798f00cca5b44a783d568ee8ed7845b). New export orders increased for the eleventh consecutive month. New orders increased from the US Africa, China and the Middle East. Rob Dobson, Senior Economist at Markit that compiles the Markit/CIPS Manufacturing PMI^®, finds that manufacturing conditions continue above trend (http://www.markiteconomics.com/Survey/PressRelease.mvc/e798f00cca5b44a783d568ee8ed7845b). Table UK provides the economic indicators for the United Kingdom.

Table UK, UK Economic Indicators

CPI	Jan month ∆%: -0.6 Jan 12-month ∆%: 1.9 Blog 2/23/14
Output/Input Prices	Output Prices: Jan 12-month NSA ∆%: 0.9; excluding food, petroleum ∆%: 1.2 Input Prices: Jan 12-month NSA ∆%: -3.1 Excluding ∆%: -2.8 Blog 2/23/14
GDP Growth	IVQ2013 prior quarter ∆% 0.7; year earlier same quarter ∆%: 2.7 Blog 3/31/13 4/28/13 5/26/13 7/28/13 8/25/13 9/29/13 10/27/13 12/1/13 12/22/13 2/2/14 3/2/14
Industrial Production	Dec 2013/Dec 2012 ∆%: Production Industries 1.8; Manufacturing 1.5 Blog 2/9/14
Retail Sales	Jan month ∆%: -1.5 Jan 12-month ∆%: 4.3 Blog 2/23/14
Labor Market	Oct-Dec Unemployment Rate: 7.2%; Claimant Count 3.6%; Earnings Growth 1.1% Blog 2/23/14 LMGDP 3/2/14
GDP and the Labor Market	IVQ2013 Weekly Hours 101.8, GDP 98.6, Employment 102.2 IQ2008 =100 GDP IVQ13 98.6 IQ2008=100 Blog 3/2/14
Trade Balance	Balance SA Dec minus ₤1026 million Exports Dec ∆%: 2.1; Oct-Dec ∆%: -0.1 Imports Dec ∆%: -3.8 Oct-Dec ∆%: -0.4 Blog 2/9/14

Links to blog comments in Table UK:

3/2/14 http://cmpassocregulationblog.blogspot.com/2014/03/financial-risks-slow-cyclical-united.html

2/23/14 http://cmpassocregulationblog.blogspot.com/2014/02/squeeze-of-economic-activity-by-carry.html

2/9/14 http://cmpassocregulationblog.blogspot.com/2014/02/financial-instability-rules.html

2/2/14 http://cmpassocregulationblog.blogspot.com/2014/02/mediocre-cyclical-united-states.html

12/22/13 http://cmpassocregulationblog.blogspot.com/2013/12/tapering-quantitative-easing-mediocre.html

12/1/13 http://cmpassocregulationblog.blogspot.com/2013/12/exit-risks-of-zero-interest-rates-world.html

10/27/13 http://cmpassocregulationblog.blogspot.com/2013/10/twenty-eight-million-unemployed-or.html

9/29/13 http://cmpassocregulationblog.blogspot.com/2013/09/mediocre-and-decelerating-united-states.html

8/25/13 http://cmpassocregulationblog.blogspot.com/2013/08/interest-rate-risks-duration-dumping.html

7/28/13 http://cmpassocregulationblog.blogspot.com/2013/07/duration-dumping-steepening-yield-curve.html

5/26/13 http://cmpassocregulationblog.blogspot.com/2013/05/united-states-commercial-banks-assets.html

4/28/13 http://cmpassocregulationblog.blogspot.com/2013/04/mediocre-and-decelerating-united-states_28.html

03/31/13 http://cmpassocregulationblog.blogspot.com/2013/04/mediocre-and-decelerating-united-states.html

© Carlos M. Pelaez, 2009, 2010, 2011, 2012, 2013, 2014