Monday, March 5, 2012

1954: Investment

This posting is part of the Bonddad Economic History Project.  The purpose of this is to go back sequentially through the US' economic history, starting in 1950, to simply see what happened from the economic side of the equation.  On the right side of the blog, you will see a link to posts that each contain links to the respective years.

The above charts shows investments contribution to GDP in 1954, along with the contribution of various sub-parts of investment.  While we see inventories helping in three quarters, I think the real story here is clear: residential investment was the largest contributor to the overall increase in investment spending in 1954.

Consider  the following chart:
Also consider this chart, from the 1954 Economic Report to the President:

As the Federal Reserve noted in their 1954 report:

Notice the mammoth increase in mortgages for the entire four year period.\\