Unemployment Rate by State over Time

Below, Corrections displays the unemployment rate by state over time (click to enlarge).

Three Cheers for New Accounting

The U.S. is the first of its peers to adopt the 2008 System of National Accounts, an improvement on our original system (we shifted towards the SNA previously in the oughts).  Most prominently, it will include R&D research and intangible assets.

This is an improvement economists have long pushed for, showing the inclusion of intangible capital (while the capital is intangible, investment in it is not) can be important in our understanding of labor productivity.

No doubt this will bring out the raving-mad conspiracy theorists.  It is an exciting and long-awaited improvement to the National Income and Product Accounts.

Using the Absolute Difference Between Mean and Median to Estimate the Standard Deviation

For a normal distribution, the expectation of the mean and median is the same.  However, in finite sample sizes, they will almost always be different.  Given a number of observations, they will be more different the higher the standard deviation.  Given the standard deviation, they will also be closer the more the observations.

Corrections presents Monte Carlo evidence that allows one to predict the standard deviation from only the absolute difference between mean and median and the number of observations, given the sample was produced using a normal distribution. Given a specific level and the number of observations, one can look up a unique value of the standard deviation.

Women as a Proportion of U.S. Workforce

Below, Corrections depicts women as a proportion of the U.S. workforce (click to enlarge).

Employment Patterns in Twelve Recessions

Below, Corrections displays the employment patterns from twelve U.S. recessions.  The first lines up NBER peaks:  these may or may not be employment peaks (click to enlarge).  The second lines up employment troughs (click to enlarge).  The two are the same data (though the percentages vary because baseline comparison levels vary).

IQR and Percentile of Stock Returns by Month

Below, Corrections plots three percentiles of monthly stock returns (NASDAQ, AMEX, and NYSE) over time.  A 1 corresponds to a 100% gain.  A 0 corresponds to no gain, and a -1 corresponds to a 100% loss (click to enlarge).  

Similarly, we plot the interquartile range (75th percentile minus the 25th percentile) of stock returns in each month (click to enlarge)

Unemployment Rate by Gender over Time

Below, Corrections displays the unemployment rate by gender over time (click to enlarge).

U.S. Bank Failures over Time

Below, Corrections graphs out the number of bank failures by quarter from 1934:Q2 to the 2 bank failures occurring in 2013:Q1 so far (click to enlarge).

Consumer Debt over Time

This recession was a period of U.S. consumers paying off in debt in dramatic fashion.  The first figure is consumer debt as a fraction of GDP by type over time:  mortgage debt has declined precipitously, and the much-talked-about increase in student debt is a minuscule part of U.S. debt (click to enlarge).

Corrections also displays total consumer credit balance by delinquency status:  while we've been paying off debt, a large fraction of debt remains delinquent (click to enlarge).

Different Government Spending Definitions over Time as a Percentage of GDP

Different figures of U.S. Government spending over time are constantly popping up online.  Corrections depicts four such graphs with a (hopefully) clear legend to match (click to enlarge).  All data from the National Income and Product Accounts.

Distribution of Stock Market Returns

Below, Corrections displays the distribution of daily holding period returns in all non-delisted stocks in the U.S. NYSE, NYSE-AMEX, NYSE-ARCA, and NASDAQ (click to enlarge).  Holding period returns include dividends.

We do the same thing but cumulate the net returns over the course of the month (click to enlarge):

What are the Long-Run Returns on Sovereign Bonds of defaulting countries?

Bondholders of defaulting sovereigns often take haircuts between 5 and 70 percent (typically around 20%) of the net present value of their bonds, but they often get large risk premia in the years running up to a default.  What are the long run returns of a portfolio that specializes in bonds of countries that are likely to default?

The answer seems to be that there looks to be a positive but small benefit to holding the bonds, though there is high variance in the outcomes.  Lindert and Morton (1989) look at 1,522 bonds over the course of 150 years and find a 0.42% premium of their portfolio against a portfolio of British and U.S. bonds.  Eichengreen and Portes find that U.S. bonds beat default-prone sovereign bonds, but default-prone sovereign bonds bean U.K. bonds during the 1930's round of defaults.  Klingen, Weder and Zettelmeyer (2004) estimate long run premia of between -0.17% and 0.46%, using various methodologies.

Below, from the book Debt Defaults and Lessons from a Decade of Crises (Sturzenegger and Zettelmeyer), Corrections depicts the degree to which a portfolio of sovereign bonds beats a portfolio of "safe" (U.S. or U.K.) bonds over long time periods for 32 country-time periods (click to enlarge).

Flow of Funds: Net Borrowing as a Percent of U.S. GDP at Annual Rates by Sector

Corrections displays the Fed Flow of Funds data.  The Flow of Funds data breaks the economy, for example, into seven sectors:  the household sector, nonfinancial corporate businesses, nonfinancial noncorporate businesses, state and local governments, federal government, rest of world, and financial sector.  Net lending in the world must add up to zero:  there are two sides to every loan.  The flow of funds breaks up the U.S. and the rest of the world, and then breaks up the U.S.  Nevertheless, the sum must still be zero.

Below, Corrections displays the flow of funds for each sector over time (click to enlarge).

The same graph zoomed into the recent period is depicted graphically below (click to enlarge).  Note that while the Federal government is borrowing much more than it used to, as a country we're receiving less than we used to from the rest of the world:  the Federal deficit is being made up by the financial sector. 

What is the financial sector?  The lending portion is made up of the Monetary authority, chartered banks, foreign banking offices in the U.S., credit unions, insurance companies, private and public pension funds, money market mutual funds, mutual funds, closed-end funds, exchange-traded funds, government sponsored enterprises, agency and GSE-backed mortgage pools, ABS issuers, finance companies, real estate investment trusts, brokers and dealers, holding companies, and funding corporations.  The borrowing portion is similar.  We organize these sources into four main sources:  1) private/stock market, such as mutual funds, exchange traded funds, and private pensions 2) government sans monetary authority, such as GSE-backed mortgage pools, government retirement funds 3)  foreign banking offices in the U.S. 4)  the monetary authority and funding companies (AIG and Bear Stearns, for instance).  We graph these four graphically below (click to enlarge):  they add up to the light blue line in the above graph.

From the second graph, we note that the Federal government is borrowing more and that this is financed by the financial sector.  We further note that within the financial sector, it is being financed primarily by domestic funds and the stock market, rather than the monetary authority.  

Indexed Employment by State

Below, Corrections displays indexed total employment by state over time.  The high outlier is North Dakota, the low outlier is Nevada.

The Impact of War on Economic Growth

Corrections took the dataset present in Growth Dynamics:  The Myth of Economic Recovery: Comment by Hannes Mueller and collapsed the dataset down to a single interesting table, giving the present period growth rates given whether a country was at war last year, this year, and next year.

Interestingly, lapsing back into war:  war last year, no war this year, but war next year, has the lowest growth rate, while failing to lapse back into war: war last year, no war this year, and no war next year, has the highest.

Bond Yields

Below, Corrections plots out bond yields in the recent period: corporate AAA, BBB, and CCC yields according to Merrill Lynch, and Treasury Constant-Maturity yields.  Note that during the housing crisis, corporate bond yields went up, while treasury bond yields went down:  

Women's Labor Force Decisions by Marital Status over Time

Below, Corrections depicts the proportion of women by marital status and labor force status over time from the Current Population Survey (click to enlarge).

What could cause this?  Why are married women working so much more?  It can't be anything special about being married--nonmarried and married women show the same pattern.  Women in general are working more.  

Even though we know it isn't anything to do with martial status, we then depict the proportion of married women by labor force status over time (click to enlarge).  Women used to work about 35% of time (other sources give 35% extending back further) to around 60% of the time, an increase of 35% (doubling the proportion of women working).  

Corrections then offers the proportion of women by martial status, educational status, and labor force status over time.  One trend dominates the pattern: women are becoming more educated, so both red lines decline while both blue increase (click to enlarge).

This is depicted more clearly below (click to enlarge):

Instead, we can normalize by the population of all women within an educational category (click to enlarge):

And we can normalize that to the proportion that was working in 1965, to see how much these proportions change over time (click to enlarge):

Households by Number of Earners

Below, Corrections depicts Households by number of earners from 1980-2011 (click to enlarge):

Making the same graph with proportions (click to enlarge):

State Unemployment

Below, Corrections displays the difference between state unemployment levels in a given month and its minimum from 2002 to that date (click to enlarge) and the difference between state unemployment levels in a given month and its maximum from 2002 to that date (click to enlarge).

U.S. Treasury Holdings by Foreign Entity

Who owns U.S. Treasuries?  Below, Corrections depicts holdings of U.S. Treasuries by Foreign Entity (non-US), from the Treasury International Capital System (click to enlarge).

While Chinese holdings of U.S. Treasuries have leveled off, the holdings of other countries have more than picked up the slack.  This can also be seen by normalizing each period to 100% and seeing the proportion of foreign-owned U.S. Treasuries owned by each actor (click to enlarge).