On the US Economy Over Time

The first two charts are the GDP (Gross Domestic Product). It shows growth per year over time. The 1st chart is the last 20 years, the 2nd is the goes back as far as the website does to 1961. 

As it shows, it has gone up & down. There is nothing outstanding about the last 4 years of administration. 

The source is here:

GDP (Gross Domestic Product) is from the World Bank

What both charts show above and some others will below – is that there was something that happened in 2008/2009 which caused a financial fall in the United States. 

Experts show that the deregulation of the banks (Bush Jr administration) caused the fall. The affect of the economy and all government decisions should be likened to turning around a very large ship. You make the turn on the helm, but it will take a while for the ship to actually be turned around. The fall of the beginning of the Obama administration was due to something that took place in the Bush administration. 

Source below: 

Deregulation of the banks 

https://www.thebalance.com/what-caused-2008-global-financial-crisis-3306176

With me so far? 

Without a doubt the Stock Market has increased over time. The below chart shows that historical trend over the past 100 years from the following source

Dow Jones 

https://www.macrotrends.net/1319/dow-jones-100-year-historical-chart

In the above we can see that it goes up & down every year, but the trajectory in general has been that it goes up. The grey background lines are periods of time when the United States has been in a recession. 

We see the same fall in 2008/2009 again in this chart, but the next 8 years it went back up under Obama and then continued the rise after Trump took over.

Great right? Isn’t that what everyone is looking at and wants to see? What I don’t understand is that I don’t think Trump did anything special – AND I don’t see the effect on American families. 

Still with me? 

The next two tables show the average income rise between income classes. As it shows, what the increase in the Dow Jones has done over time is increase the gap between the super rich and everyone else. Between the non-super rich, the gap has also increased, but not as much

The first chart shows the average household income with inflation adjustments, the second one is without inflation. 

Both show the same gap disparity.

Since it’s from a source I don’t know anything about (DQYDJ), I went to the US Census Bureau to get raw numbers. 

Below is the chart I pulled right from the site. The black is the numbers from the site and where it is red is where I made my own calculations using formulas. The chart was created from the table. I made it. 

The raw numbers from the census bureau coincide with the numbers from the DQYDJ source. 

Average Household – United States Census Bureau

https://www.census.gov/library/publications/2001/demo/p60-213.html

What about cost of living and how much it costs to buy a home? 

For those not familiar with COLA – it stands for Cost of Living Adjustment. It is what is used by the United States government and most employers to adjust salary raises so employees can afford to live the same way as prices rise. It’s separate from a raise or promotion. It’s just to even things out as prices rise. 

This data came from the Department of Social Security and US Census Bureau. Neither were readily available in charts, I downloaded raw data tables from each site and put them together below. 

Here again, black is the raw data and the red and chart are my own calculations based on the two sources below. 

The gap between how much a family makes and how much it costs to buy a house has not grown equally. The average family pays more for a house based on their income. Trump did nothing to improve or worsen this situation. 

Cost of Living from Department of Social Security 

https://www.ssa.gov/oact/cola/latestCOLA.html

Cost of Housing

https://www.census.gov/construction/nrs/historical_data/index.html

Lastly I’d like to address unemployment. The first chart goes back to 1929. Again it shows the 2008/2009 affect of the deregulation of the banking industry. As well as a downward (lower is better) trend from the Obama administration right away, well into the Trump administration. There is nothing significant about the last 4 years if we look back over the last 91 years. 

The second chart shows unemployment by race. The blue line shows the US unemployment rate. The orange line shows white unemployment, the yellow shows Hispanic unemployment, and the gray shows black unemployment. 

If you overlay the charts (I didn’t do that but you can look), the unemployment rate naturally rises and falls with the Dow Jones. Even though the Dow goes up, unemployment rates rise and fall as they always did. A more booming stock market does very little for people over time. 

This data is from the United States Bureau of Labor Statistics 

https://www.bls.gov/charts/employment-situation/civilian-unemployment-rate.htm

What I conclude from this is that the stock market doesn’t really improve the comfort level of the average American, unless you are in the highest 5% income bracket.  

The US Economy is governed by an Invisible Hand, just as we learned in Elementary School. And unless we do something drastically different, the gap between rich and poor will continue to widen. 

If you enjoyed my writing, consider leaving a comment, sharing with others, or following my blog

https://esterinaanderson.com

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