Wednesday, May 20, 2009

Growth and Equities in the G7: scary or encouraging?

Today is my birthday - can you guess during which recession I was conceived? In lieu of waking up early to blog a lengthy commentary, I chose to construct two charts.

G7 Growth: Going down hard

The chart illustrates quarterly growth rates on an annualized basis. Canada has not released Q1 GDP yet; the -6.5% represents the Bank of Montreal's forecast.

The G7 ex the US release their GDP growth rates on a q/q basis, not annualized. This chart compares the growth rates on an annualized basis ((Q1 2009/Q4 2008)^4-1)*100 = annualized growth for the comparison to the BEA's release. Clearly, the G7 is deep in the red.

G7 Equities: Moving on up

The chart illustrates equity indices for the G7 economies, normalized to 1994. A rebound is afoot - is it sustainable?

Rebecca Wilder


  1. Happy Birthday RW.
    All the best from a Canadian blog follower.

  2. Happy birthday and continued thanks for a great blog!

  3. Happy Birthday! Wonderful charts.

    I wonder what the G7 GDP chart would look like back to 1995.

  4. Rebecca, Happy birthday. I love your blog,

  5. Happy birthday, Rebecca.

    I will guess you were conceived during the 1973-1975 recession. I figure you got your B.A. at about age 22, then were in grad school for perhaps 4 years until age 26, then worked as an assistant professor for another two years until age 28, then worked in finance for at least one year. That makes it hard for you to be under age 29. That means it is unlikely you were conceived during the lengthy 1981-1982 recession. If you got through grad school in less than four years, it's possible you were conceived during the 6-month 1980 recession (Jan-July 1980). However, I'd rather not place my bets on such a short recession. The next earliest recession was the 16-month 1973-1975 recession. This one is tied with the '81-'82 recession for being the longest post-war recession, which means the probability that you were conceived during it is considerably greater than most other recessions. I'm afraid that I'm guessing you are older than you actually are, but if you were conceived during the '73-'75 recession you'd still be a few years younger than me.

  6. Thank you for the birthday wish Charles, David, TH, Vitoria, and James.

    James you got it right - I turned 34 yesterday. But here are more specifics:

    I was in grad school until 29 - after my BA, I worked for a little while in NY, which is exactly what prompted me to go to grad school. In the world of finance, a BA in math equals auditor....boring!

    I have been an economist in the financial services industry for 1.5 years now, so assistant professor before then (around 3 years - I really wanted to be in the heart of the markets, so I left academics).

    Have a wonderful week!