Ed Yardeni — Economic Comparison of Thanksgiving 2002 vs. 2007
Kurt Brouwer November 26th, 2007
Continuing in our positive mode following the Thanksgiving break, we bring you economist Ed Yardeni’s comparison of our economy on this Thanksgiving Day versus that of the year 2002. Five short years have made quite a difference and Mr. Yardeni is grateful for eight serious improvements and one tongue-in-cheek mystery point:
Nine Things For Which To Be Thankful (Real Time Economics Blog, November 26, 2007)
‘Forecaster Ed Yardeni’s list…with a kick in the shins for Alan Greenspan.
(1) The S&P 500 is up 53% since Thanksgiving 2002. The current bull market has been the third best since 1960.
(2) The 10-year Treasury yield was near 5.5% in early 2002. It is down to 4.0% this morning.
(3) The core CPI inflation rate in the US has been remarkably steady around 2%, and down from 2.6% to 1.8% on average among the 30 members of the OECD, despite the soaring price of crude oil, which is up from $27 a barrel to $99 a barrel since Thanksgiving 2002, based on West Texas Intermediate price.
(4) Notwithstanding all the nonsense about outsourcing, the unemployment rate was down to 4.7% in October vs. 5.7% five years ago as payroll employment rose 8.1 million to a record high of 138.4 million.
(5) Real disposable personal income was at a record high in September, up 16.0% since September 2002. Real per capita income is also at a record high and up 2.1% per year, on average, over the past five years.
(6) Real GDP is up 15.3% over the past five years.
(7) In the US, since the end of 2002, household net worth is up nearly 50% to a record $57.9 trillion.
(8) World exports have doubled since November 2002. The OECD world industrial production index is up 30% since then. Today, roughly three billion people around the world are aspiring and perspiring to improve their standards of living…’
I’ll leave you guessing as to number nine. You’ll have to go to Real Time Economics to figure it out. The point is not really related to economics though, but rather it’s a mild snarky comment about former Fed chief Alan Greenspan, who has been all over the media of late.
In all fairness, the comparisons Yardeni cites are not surprising given that the economy in late 2002 had begun a recovery from a short recession and the worst stock market since World War II, not to mention the economic devastation of the terror attacks of 9-11. Nonetheless, this list does a good job of putting in perspective current rates of unemployment, interest and inflation.
However, the most amazing statistic in my opinion is number seven, household net worth. For more on this, see $57.9 Trillion — American Net Worth.
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