Assignment 3

One of the leading indicators of economic decline is new housing starts. Figure 1 below is a timeseries plot of US new housing starts for single family dwellings from 1960 to 2010. What we can see is a clear correspondence to historical recessions: Oil shocks of early 70's, 1980, 1990 and then the most recent. Interestingly for the most recent downturn it quite clearly began trending downward by 2005 and doing so rather steeply. Yet, the the banking and realistate 'crash' didn't occur until the fall of 2008. Moreover, in this simple time-series graph we can see the current economic situation in historical perspective--from this view point the downturn is quite significant and severe.

Figures 2,3 and 4 are plots of the recession from an international perspective. Figure 1 is a snap shot of the major economic nations in Europe, Asia, Latin America and the United States. This plots the percentage change in a nation's GDP from it's last quarter value.For instance, in quarter 1 of 2009 Mexico's GDP saw a near 5 percentage point drop. In this we can see that not every region has been affected equally. Germany and Mexico suffered severely while India has maintained positive growth throughout. Figure 3, adds 5 more nations to the plot. We can see the general trend repeated with some clear 'outliers'. Mexico and Russia suffered stark declines, while India again shows continued growth. Figure 4 is a boxplot of all 9 nations. This allows us to see the general mean of the population as it declines beginning in 2008. For much of 2007, all of the nations were exibiting positive growth. By quarter 3 of 2008 nearly all of the nations had dipped into negative growth. Yet, we can also see that by quarter 2 of 2009 positive GDP growth had become the overall trend.



Figure 1

Figure2

Figure3

Figure4