Tuesday, June 2, 2009

The Latest Expansion's GDP, Investment

Today I'm going to continue on the GDP theme by looking at investment.

Click on all pictures for a larger image.

All figures are in 2000 chained dollars.

Total gross investment increased until the beginning of 2006 when it started to decline.

Gross investment as a percentage of GDP also increased to a bit above 17%% in 2006 and has fallen since. Now it stands at 11.86%.

Non-Residential Structures remained relatively constant until about mid-way through the expansion. Then they took off in a big way. They have only recently started to fall.

Non-residential structures increased from about 2.5% of GDP to 3% of GDP and has only recently started to fall.

Residential investment increased until the end of 2005/beginning of 2006. It has since dropped hard and fast.

Residential investments as a percent of GDP followed the same track. Now it stands at 2.58%.

In late cycle increase in non-residential investment probably prevented a housing crash back in 2006. By that time the housing bubble was nearing its absolute peak. But the increase in commercial real estate investment pulled residential construction workers into the commercial market.