Federal Reserve Economic Data

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New reflections for the new year

Some good news and some bad news about U.S. life expectancy

For many of us, it’s almost impossible to avoid at least some self-evaluation during the holidays, as we transition from one calendar year to the next. So here’s some input and, perhaps, something new to think about at the start of the year.

Let’s look at the good news first: Over the past 50 years, life expectancy in the U.S. has increased significantly, by almost 9 years, from 69.8 in 1960 to 78.8 in 2015. (The measures here are based on “life expectancy at birth,” which is the average number of years a newborn infant would live if prevailing patterns of mortality at birth were to stay the same throughout his or her life.) The graph shows that this improvement for the U.S. (thick black line) has been relatively steady over the years. To be sure, adding 9 years to a life is a big deal. A longer lifespan allows us to enjoy more years of retirement and interact with family (including children, grandchildren, and great-grandchildren) but it’s also associated with better overall health over the lifetime.

But the graph also shows two patterns that also deserve reflection. First, the gains in life expectancy have been slowing down since the early 1980s, most notably in the past five years. Second, the U.S. was right in the middle of the pack in 1960 but is now lagging far behind all other developed countries. Indeed, in 1960, the U.S. was below the U.K. and Canada, essentially on par with France and Germany, but significantly above Japan and Italy. Fast forward to 2015 and you can see the U.S. is below all these countries by a significant margin: The Japanese and Italians are expected to outlive Americans by an average of five years, and the French are expected to outlive Americans by four years.

This comparison is among developed countries with comparable economic and geographic conditions (all are developed and all are in the Northern Hemisphere), but all these countries also have a presence in the genetic makeup of the U.S. population. So, what are the culprits that have caused the U.S. to lag behind? Food? Stress? Lack of exercise? Ingesting toxins and other risky behavior? Even if we knew the precise reasons, why would conditions be so different today?

How this graph was created: Search for “Life-Expectancy” and “United States.” From the Edit Graph” menu, select “Add Line” to add each of the other six countries, each time simply typing “Life-Expectancy” and the country name. Finally, to highlight the U.S. series, choose “Format” and select 5 for the width of the line and black for its color.

Suggested by Alexander Monge-Naranjo.

View on FRED, series used in this post: SPDYNLE00INCAN, SPDYNLE00INDEU, SPDYNLE00INFRA, SPDYNLE00INGBR, SPDYNLE00INITA, SPDYNLE00INJPN, SPDYNLE00INUSA

All that glitters is not necessarily a good store of value

The evolution of precious and not-so-precious metal prices

The FRED team is busy adding new data almost every day, as new data are released almost every day. That includes the week between Christmas and the new year. Still, we found some time to create this FRED graph, which shows the prices of gold, copper, and nickel. You may have noticed the colors of the lines match the colors of their metals, thanks to FRED’s flexible graph formatting tool. Note also that we displayed the price of gold on a different scale, as it’s an order of magnitude or two higher than the others. The prices of these metals, as is often the case with commodities, are quite volatile. There seems to be a connection between the price of copper and the price of nickel: Both, for example, are used as an alloy in the manufacture of coins. But the price of gold seems to follow its own laws. At any rate, none of these metals instills confidence that its price is certain to appreciate, despite what some advertisements claim. This lack of certainty becomes even more apparent when you adjust for inflation, as shown in the graph below.
How this graph was created: NOTE: Data series used in these graphs have been removed from the FRED database, so the instructions for creating the graphs are no longer valid. The graphs were also changed to static images. Suggested by Christian Zimmermann.
View on FRED, series used in this post: CPIAUCNS, GOLDAMGBD228NLBM, PCOPPUSDM, PNICKUSDM

Busting a Santa myth

How hard are the elves working?

We’ve all heard that Santa and his elves are wildly busy, especially through December, making toys and other gifts for the Christmas season. Can FRED tell us anything about how busy they are? As it turns out, FRED does have quite a bit of employment data on Santa’s neighborhood: Alaska! (Which includes the town of North Pole!)

Given the quantity of gifts distributed on Christmas eve and the size of Alaska’s economy, we reckon that Santa’s enterprise is a major player and that Alaska’s economy is a good proxy for what’s happening in Santa’s shop.

We’re sorry to say that Alaska’s employment data do not corroborate the story that Santa and his elves keep busy in December. The graph above shows the total number of employees in Alaska’s private businesses. This measure excludes government employees, but it’s reasonable to assume Santa isn’t part of the government.

What’s really striking about this graph is the strong seasonal pattern. Significantly more people work in some months than in others, and the differences aren’t small: There’s a 20% difference between the top and bottom in each year. If you look closely (either by shortening the sample size or by hovering over the graph), you see that January has the least employees, which is expected, since Santa has just finished the deliveries and is likely on vacation with the elves. But the top months are all in the summer. This means the elves aren’t scrambling right before Christmas, but instead have planned their production well ahead of time. The graph below tells a similar story, in that weekly hours worked follows the same pattern as the employment measure: They actually bottom out every December.

In conclusion, the story that elves are overworked making toys right up to Christmas is simply a myth.

How these graphs were created: Search for “Alaska private employment,” and both series will be among the choices. Choose on the monthly, not seasonally adjusted series.

Suggested by Christian Zimmermann.

View on FRED, series used in this post: SMU02000000500000001, SMU02000000500000002


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