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Yahoo's data didn't start at the inception date, but it's close enough for government work.

Moral of the story? Wall Street always has your back!


File:Stab-in-the-back postcard.jpg

TBT Profile


To put it in perspective, 0.93% is roughly double what the average 5-year CD is paying. That's just adding insult to back injury.

Source Data:
St. Louis Fed: WTI Crude Oil Prices
Yahoo Finance: TBT Historical Prices

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Once we get through this post-recession soft patch, things are really looking up!

Source Data:
St. Louis Fed: Moving 12-Month Total Vehicle Miles Traveled

I heard this phrase from a guest on CNBC today. Perhaps it is time for a refresher course on the meaning of the word cheap.

The Free Dictionary: Cheap


Let's attempt to compare the cost of energy to the cost of everything to find out how relatively low in cost energy actually is. The following chart shows the annual average of the consumer price index for energy divided by the consumer price index for all items.


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Did I somehow manage to transport myself to a Pulp Fiction alternate universe? It's sure starting to feel that way lately.

Say "cheap energy" one more time! I dare you!

See Also:
The Pulp Fiction of Rising Interest Rates

Source Data:
St. Louis Fed: Custom Chart

The following chart shows auto and other motor vehicle sales divided by sales at food and beverage stores and food services and drinking places.


Click to enlarge.

Since this is an illusion of prosperity blog, you can probably guess which "sure thing" seems more likely to me over the long term.

1. When the downward trend in blue failed, it failed to the downside.
2. We have fully recovered back to the trend in blue.

This is not investment advice.

Source Data:
St. Louis Fed: Custom Chart

The following chart shows the natural log of real disposable personal income per capita. Once again, constant exponential growth shows up as a straight line when using natural logs.


Click to enlarge.

There are at least a few things worth considering.

1. Due to rising income inequality, the typical person isn't doing nearly as well as this chart would suggest.

2. As automation takes on more and more human work, how will billions of people find employment? How much of this is seen in the chart?

3. The trend is definitely not a straight line. It is curving downwards with a very high correlation of 0.993. If the current trend continues, then we'll peak in 2058 (45 years from now). That's a big if. If I'm alive to see it, I'll be 94 years old. That's another big if.

4. It is mathematically impossible for this upside down parabolic trend to continue forever. There must be a failure at some point. If nothing else, I don't think any rational person would expect real disposable personal income per capita to ever fall below zero. That would happen in 2164. This would certainly not be the first failure we've seen in recent years. We live in the era of long-term trend failures.

5. Any failure would probably be to the downside, since that is the direction the data is being pulled (much like a camel's back when more and more weight is placed upon it).

6. Contrary to some, I therefore definitely believe that the long-term future is not so bright that I gotta wear shades.

“I believe in making the world safe for our children, but not our children's children, because I don't think children should be having sex.” - Jack Handey

Japan (our partner in ZIRP crime) must love Jack Handey quotes.

December 23, 2013
Japan’s Diaper Shift and Global Population Trends


For what it is worth, I'm very much a believer in the theory. In some ways, we're like locusts and the lowest hanging fruit has already been eaten (USA prosperity analogy). I know it sounds grim, but that's what I believe. The good news is that I'm thankful every day that I was born where and when I was.

As seen in the chart, I'm not at all convinced that our children's children will be quite as thankful. It isn't that I think they will be unhappy being born in America. Far from it. I simply question the timing. It's not like I would tell them to move to China. Let's just put it that way.

Source Data:
St. Louis Fed: Custom Chart

The following chart shows the consumer price index for services divided by the consumer price index for nondurables.


Click to enlarge.

Goodbye service economy tailwinds.
Hello service economy headwinds.

Perhaps Bernanke can give our service economy some inflation but he sure can't seem to target where it goes. As seen in the chart, we eventually managed to get back to the trend line in the aftermath of the 1970s. We're sure making feeble progress these days though. Fantastic. Get out the party hats.

In fact, I am not confident that we will ever return to the trend line. This is yet another epic exponential growth failure. Using the power of future hindsight, we might even consider ourselves fortunate if we can maintain present levels. Sigh.

Why is this bad? When nondurables rise in price faster than services then this service economy's many, many service employees get the short end of the stick (even less stick than they currently think they are getting).

Durable good

Examples of nondurable goods include fast moving consumer goods such as cosmetics and cleaning products, food, fuel, beer, cigarettes, medication, office supplies, packaging and containers, paper and paper products, personal products, rubber, plastics, textiles, clothing and footwear.

While durable goods can usually be rented as well as bought, nondurable goods generally are not rented.

Nondurables are generally not rented yet? Say what? I sense a business opportunity!

May 4, 2012
Renting Prosperity


Rent the good life! Premium Gasoline! Beluga Caviar! Gurkha Black Dragons! Samuel Adams' Utopias! Lucentis! The Nondurable Rental Corporation of America will fulfill all your nondurable rental dreams and then some with low, low payments amortized over your remaining expected lifespan (with only modest surcharges of course)!

Have I mentioned lately that I'm a permabear? This is not investment advice. It's a business opportunity! Tap those severely tapped consumers before they are entirely tapped-out again! What could possibly go wrong? Genius!

In the epic battle between health care services, college education services, and nondurable fuel prices, which pain will ultimately reign supreme? Stay tuned! It's sure to be a hoot!

Source Data:
St. Louis Fed: Custom Chart

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I know what you are thinking. Okay, sure. That's definitely a peak. It can't be the ultimate peak though. Our population is growing and the future is so bright I gotta wear shades!

Not so fast. Let's put that same data on a log chart. On a log chart, constant exponential growth is seen as a straight line.


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That's not straight. It's curving exactly like a baseball in flight would, and when I say exactly I mean with an r-squared of 0.995.


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If the 80+ year long-term trend continues, only the wealthiest among us will be flying in planes someday. How's that for a kick to the long-term prosperity gonads? It isn't just flying either. Driving looks mighty suspect as well. Just doing my part to add some perspective! Sigh.

Despair.com: Perspective

This post inspired by Rob Dawg who pointed me to a whole new world of FRED quantity indices (in the comments found here).

Source Data:
St. Louis Fed: Public Air Transportation
St. Louis Fed: Public Air Transportation (Natural Log)

The following chart shows real annualized power construction spending per capita (October 2013 dollars).


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Tack on another $117 per year that will ultimately be passed on to the people (each man, woman, and child).

Hey, maybe it won't appear all at once though, thanks to the Fed's ZIRP providing long-term financing at supposedly super cheap long-term interest rates. That debt could potentially just brew and percolate for a few decades perhaps. So we've got that going for us, which is nice.

Power to the people (slogan)

With $90+ oil, power to the people has a whole new meaning now of course.

It doesn't look like we can expect much power construction job growth per capita from here. As seen in the chart, real spending per capita is just sliding along sideways at a higher new normal. I guess we'll just have to make it up on fast food jobs.

August 29, 2013
The Fast-Food Restaurants That Require Few Human Workers

Introverts of the world unite! I say this as an introvert who generally enjoys gallows sarcasm of course. Deep sigh.

Source Data:
St. Louis Fed: Custom Chart