Embed Size (px)
Citation preview
www.moffattnichol.com
Transpacific Maritime Conference Long Beach, California February 6, 2014 Dr. Walter Kemmsies, Chief Economist Moffatt & Nichol Economics Group
Outlook: 2014 and a Bit Beyond
www.moffattnichol.com 2
Summary 2014 has everything going for it but weather Depending on how pre-emptive central banks are, 2015 also looks good Europe and Japan are recovering, Emerging Markets will stabilize soon US imports have more macro support than exports
Global outlook = US outlook US regained global economic leadership in 2011 US remains large enough to make or break global efforts for many years Non-US trade lanes can be affected by US trends
Prosperity beyond 2015 if developed economies adapt, otherwise… Managed correctly, productivity growth cures economic malaise US needs to develop export-oriented infrastructure US exports have more upside potential than imports beyond 2015
www.moffattnichol.com 3
75
85
95
105
115
125
135
145
155
25
45
65
85
105
125
145
165
185
205
2251
99
2
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
Real Retail Sales ex-Autos Auto Sales New Home Sales Employment (RIGHT)
Employment and Main Consumer Spending Categories: 1992 – 2014
Average car age = 11 years
www.moffattnichol.com 4
US Major Port Container Volumes (TEUs) By Type
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
De
c-0
5
Jun
-06
De
c-0
6
Jun
-07
De
c-0
7
Jun
-08
De
c-0
8
Jun
-09
De
c-0
9
Jun
-10
De
c-1
0
Jun
-11
De
c-1
1
Jun
-12
De
c-1
2
Jun
-13
De
c-1
3
Total Total Loaded Imports Exports Empties
2.5%
2.4%
2013 Growth
www.moffattnichol.com 5
Global and US Inflation-adjusted (real) GDP Growth: 1980 – 2013E
-4%
-2%
0%
2%
4%
6%
8%1
98
0
19
82
19
84
19
86
19
88
19
90
19
92
19
94
19
96
19
98
20
00
20
02
20
04
20
06
20
08
20
10
20
12
Global GDP US GDP
Emerging Market investment in capacity created divergence
www.moffattnichol.com 6
-$80
-$60
-$40
-$20
$0
$201
99
2
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
Goods Balance Services Balance Oil Balance
Billions
6
32% of the trade deficit is due to oil
US Trade Balance Components: 1992 -2012
www.moffattnichol.com 7
0
20
40
60
80
100
120
140
160
180
2001
97
0
19
72
19
74
19
76
19
78
19
80
19
82
19
84
19
86
19
88
19
90
19
92
19
94
19
96
19
98
20
00
20
02
20
04
20
06
20
08
20
10
20
12
20
14
20
16
Recession Employment (millions)
Trend Forecast Employment Share of Population (%)
18 Mos15 Mos
10 Mos
26 Mos
30 Mos
77 Mos Jun 201446 Mos
Participation does not recover until 2016
US Employment 1970 – 2015 And Recovery Periods
www.moffattnichol.com 8
-10%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
110%
120%
130%
140%
19
53
19
55
19
57
19
59
19
61
19
63
19
65
19
67
19
69
19
71
19
73
19
75
19
77
19
79
19
81
19
83
19
85
19
87
19
89
19
91
19
93
19
95
19
97
19
99
20
01
20
03
20
05
20
07
20
09
20
11
20
13
Recession Debt to Income Ratio Annual Growth in Debt
Household Debt-to-Income Ratio and Growth Rate of Debt
Expected Ratio
www.moffattnichol.com 9
0%
20%
40%
60%
80%
100%
120%
$0
$2
$4
$6
$8
$10
$12
$14
$16
$18
19
76
19
77
19
79
19
81
19
82
19
84
19
86
19
87
19
89
19
91
19
92
19
94
19
96
19
97
19
99
20
01
20
02
20
04
20
06
20
07
20
09
20
11
20
12
Trill
ion
s
Govt Debt Govt Debt to GDP
Maastricht Treaty = 60%
US Government Debt and Debt-to-GDP Ratio: 1976-2013
www.moffattnichol.com 10
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%1
95
4
19
57
19
60
19
63
19
66
19
69
19
72
19
75
19
78
19
81
19
84
19
87
19
90
19
93
19
96
19
99
20
02
20
05
20
08
20
11
20
14
Recession Fed Funds Rate 10-Yr Bond Yield
Fed starts buying $85 billion of gov’t debt each month
Short and Long Term Interest Rates Since 1954
www.moffattnichol.com 11
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
0%
5%
10%
15%
20%
25%
19
00
19
07
19
14
19
21
19
28
19
35
19
42
19
49
19
56
19
63
19
70
19
77
19
84
19
91
19
98
20
05
20
12
20
19
20
26
20
33
20
40
20
47
Tho
usa
nd
s o
f P
eo
ple
Shar
e
65 and Over Share of Population (left) Increase in Over 65 Population (right)
First Boomers Turn 65 (2011)
Last Boomers Turn 65 (2026)
Kemmsies turns 65
People Turning 65 and Their Share of the Population: 1900 - 2050
Today
www.moffattnichol.com 12
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
14%1
98
0
19
82
19
84
19
86
19
88
19
90
19
92
19
94
19
96
19
98
20
00
20
02
20
04
20
06
20
08
20
10
20
12
20
14
20
16
20
18
World Advanced economies Developing Asia
Source: IMF
Real GDP Growth: 1980 -2018E
www.moffattnichol.com 13
0%
10%
20%
30%
40%
50%
60%
70%1
99
7
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
China Mexico South Asia
Share of US Import Value From China, S Asia and Mexico
www.moffattnichol.com 14
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
$45,000
$50,000
$55,000
44% of World Population 9% of World Population
Low wages in Latin America indicate they are prime locations for “near-sourcing” Low wages in South
and Southeast Asia indicate they are prime locations for off-shoring
Manufacturing Wage Comparisons in US Dollars in 2008 and 2012E
www.moffattnichol.com 15 Source: IMF
International Comparison of Interest Rates
0%
5%
10%
15%
20%
25%1
99
9
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
Brazil
China
Europe
US
Japan
www.moffattnichol.com 16
Labor is more expensive and capital is cheaper in the US compared to fast growing economies such as China. The US has comparative (and competitive) advantages in the production of goods that use little labor. This is shown in the list of goods that the US has been prone to export.
Containerized Score Bulk/Breakbulk Score
Wood Pulp Scrap and Waste 9.4 Oil Seeds (Soy) 32.7
Oil Seeds (Soy) 1.1 Meat and Other Edible Animal Parts 28.7
Raw Hides And Leather 0.8 Cereal Grains 3.9
Cotton - Untreated, Yarn And Woven Fabric 0.7 Animal Feed 3.4
Animal Feed 0.7 Wood And Charcoal 0.4
Meat and Other Edible Animal Parts 0.3 Crude Oil and Refined Petroleum/Natural Gas Products 0.4
Plastics Feedstock and Manufactured Goods 0.2 Live Animals 0.3
Iron And Steel 0.1 Wood Pulp Scrap and Waste 0.2
Paper and Paperboard 0.1 Fish and Crustaceans 0.2
Chemical Products 0.1 Dairy Products, including Eggs and Honey 0.1
Cereals 0.1 Organic Chemicals 0.1
Organic Chemicals 0.1 Plastics Feedstock and Manufactured Goods 0.1
1 Based on relative comparative advantage as defined by Bela Belassi
Top 10 High Potential US Net Exports1
www.moffattnichol.com 17
Summary 2014 has everything going for it but weather Depending on how pre-emptive central banks are, 2015 also looks good Europe and Japan are recovering, Emerging Markets will stabilize soon US mports have more macro support than exports
Global outlook = US outlook US regained global economic leadership in 2011 US remains large enough to make or break global efforts for many years Non-US trade lanes can be affected by US trends
Prosperity beyond 2015 if developed economies adapt, otherwise… Managed correctly, productivity growth cures economic malaise US needs to develop export-oriented infrastructure US exports have more upside potential than imports beyond 2015
Moffatt & Nichol was founded in 1945 to provide engineering and consultancy services to the world’s maritime industry.
Today, Moffatt & Nichol supports port and maritime projects, transportation infrastructure, coastal and environmental restorations, and waterfront developments worldwide.
Our capabilities allow us to take a project from conception, through the critical study and analysis process and on to design, engineering and program management. Clients can expect thoroughly integrated projects, completed under exacting quality control standards, with the innovation and creativity for which our firm is known worldwide.
Ports
Container Terminals
Bulk Terminals
Marinas
Ferry & Roll-On/Roll-Off Terminals
Waterfronts & Leisure Facilities
Quays & Jetties
Cruise Ship Facilities
Oil & Gas Terminals
Harbors
Rivers, Canals & Inland Waterways
Naval & Coast Guard Bases
Wind Power Development Projects
Economic & Market Studies
Inspection & Rehabilitation Projects
Dr. Walter Kemmsies, Chief Economist Moffatt & Nichol, New York 104 West 40th Street 14th Floor New York NY 10018 T 212.768.7454 F 212.768.7936
www.moffattnichol.com
