503-785-3485
bill@conerlyconsulting.com
  • Facebook
  • Twitter
  • Linkedin
Conerly Consulting Conerly Consulting
  • Consulting
    • Approach/Philosophy
    • Sounding Board
    • Economics and Business Strategy
    • Assessment
    • Case Studies
    • Testimonials
  • Speaking
    • The Package
    • Topics
    • Testimonials
  • Writing
    • Businomics Newsletter
    • Businomics
    • The Flexible Stance
    • Blog
  • Industries
    • Agriculture
    • Banking/Finance
    • Energy
    • Manufacturing
    • Real Estate
    • Small Business
    • Telecom
    • Trucking
    • Wholesale Trade
    • Wood Products
    • Other Industries
  • Video
    • Speaking
    • Event Promotion
    • Business Planning
  • About
    • News Coverage
  • Contact
  • Consulting
    • Approach/Philosophy
    • Sounding Board
    • Economics and Business Strategy
    • Assessment
    • Case Studies
    • Testimonials
  • Speaking
    • The Package
    • Topics
    • Testimonials
  • Writing
    • Businomics Newsletter
    • Businomics
    • The Flexible Stance
    • Blog
  • Industries
    • Agriculture
    • Banking/Finance
    • Energy
    • Manufacturing
    • Real Estate
    • Small Business
    • Telecom
    • Trucking
    • Wholesale Trade
    • Wood Products
    • Other Industries
  • Video
    • Speaking
    • Event Promotion
    • Business Planning
  • About
    • News Coverage
  • Contact
  • Home
  • Uncategorized
  • The Composition of the Economy: It’s Not What You Think

Uncategorized

31 Jul 2009

The Composition of the Economy: It’s Not What You Think

  • By Bill Conerly
  • In Uncategorized
  • 2 comments

Yesterday I heard a doom and gloom outlook from a businessman whose attitude derived the weak commercial real estate market.  I regularly hear from residential real estate brokers and developers that the economy is terrible, terrible, terrible.  And if the stock market has had a bad day, everyone who follows his investments too closely thinks that the economy is lousy.

As an economist, my job is to have perspective on all of this.  That is fairly easy to do if you keep in mind the composition of the economy.  Here it is (excluding inventory changes and net exports, because it's hard to put negative numbers into a pie chart):

GDP Composition

Look at the two smallest wedges of the pie: residential and non-residential construction.  That's why I'm not terribly pessimistic about the overall economy, despite being pessimistic about the near-term outlook for these two sectors.  They are small.

What's big?  The consumer service sector.  Also consumer non-durables, which includes food eaten at home, clothing and gasoline.  These are not only big sectors, they are fairly stable sectors.

My greatest frustration as an economic forecaster is listening to the "factoid economists," people without a good grasp of the whole, who seize on anecdotes here and there, extrapolating from small sectors to the overall economy.  My advice: spend a little time with the numbers.  The whole GDP accounts (including the revisions released today) are available at the BEA website.

  • Share:
Bill Conerly

    Comments

  1. Josh Purington
    August 14, 2009

    What do the pink and periwinkle (light blue) colors represent?

  2. Bill Conerly
    August 14, 2009

    Oops, federal government and state and local government. Gov’t counts production of goods and services, but not transfers such as social security. Sorry for not including them on the legend.

Comments are closed.

Search

Sign Up For Our Newsletter!

View Latest Issue

RSS Bill’s Forbes Articles

  • The Back Rent Problem Won’t Hurt The Economy January 19, 2021
    Being behind on rent is a big problem for tenants and for landlords, but it’s not a big problem for the economy as a whole, despite the scary numbers.

Testimonials

As you know, it can be difficult to find economists who provide good substantive information who are so entertaining and engaging. I received many enthusiastic comments from members and others in attendance. I was very pleased with Dr. Conerly and have recommended him to NCSTAE, our national organization.
Molly Steckel, Idaho Telecom Alliance
Every time you spoke, we got business.
Chris Rasmussen, Washington Trust Bank, Bank of the Northwest
Dr. Conerly’s presentation and view of the economic conditions impacting the world of business is insightful and thought-provoking. His analysis and presentation style is audience focused and engaging, leading to the efficient development of follow-up activities by those in attendance.
Paul Ulrich, The Inteplast Group (plastic bags)
Bill assisted O.B. Williams Company with developing a strong business plan that we implemented 18 months ago. As a result and together with Bill, we are improving our position within our highly competitive market segment.
David Wick, CEO, O.B. Williams Company (wood products)
AgFirst Farm Credit Bank has benefitted from Bill Conerly’s unique insights and perspectives several times over the past five years…his materials consistently cover the points that we agree on…he has been very well-received by our groups, and we look forward to having Bill with us again in the future.
Ronnie Hucks, AgFirst Farm Credit, Columbia
Bill did a great job. We look forward to a continuing relationship.
John Hamburger, Franchise Times
Seems no matter where I go, I hear you talking – and always doing a great job with different material well tailored to the audience. Very impressive!
Alan Shiffer, World Vision
Bill did a great job! There were many in the audience who liked him and many in the audience who loved him! Bill shared pertinent and timely information with our audience of commercial real estate professionals and added interesting stories and a funny sense of humor twist.
Jana Knoll, BOMA Boise
Thank you for a wonderful presentation. Everyone who heard your presentation was impressed with your analysis, and strong command of facts and theory. More importantly, your ability to weave together substance with humor, in a very dynamic way, meant our attendees learned and retained more information than we would have typically expected. You made economics fun and you left our members with powerful insights on trends and issues to consider as they prepare for the future.
John Aguirre, Oregon Association of Nurseries
We asked Bill Conerly to look at one of the major factors limiting the growth of our business. He pulled together data from a wide range of sources, as well as his own extensive business knowledge, to give us an insight into when conditions would improve and how we could be ready to capitalize on better times. He did so in a straight forward, easy to understand manner. A year later it was clear that things had evolved just as he had forecast. Ever since then he’s been my go-to guy on how the e…
Len Ludwig, former CEO, Vencore Capital LLC

Get in touch

(503) 785-3485

bill@conerlyconsulting.com

PO Box 2188
Lake Oswego, OR 97035

Useful Links

  • Consulting
  • Speaking
  • Videos
  • Blog
  • Press
  • Contact

Social Links

  • Facebook
  • Twitter
  • Linkedin

Newsletters

Copyright 2020 Conerly Consulting LLC