By: Anirban Basu Sage Policy Group, Inc.

September 23, 2013

Going Up for the Rebound

On Behalf of

ICSC

First Pitch

Historic and Projected World Output Growth 2004 through 2014*

Source: International Monetary Fund

*2013-2014 data are projections

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

5.0% 4.6%

5.3% 5.4%

2.8%

-0.6%

5.2%

4.0%

3.2% 3.1%

3.8%

An

nu

al

% C

ha

ng

e

Real GDP Growth, 20 Fastest and Slowest Growing Countries Estimated 2013, Annual Percent Change (for available nations)

Source: IMF

Rank Country Region % Rank Country Region %

1 South Sudan Africa 32.1 166 Barbados Caribbean 0.5

2 Libya Middle East 20.2 167 Bosnia and Herzegovina Eastern Europe 0.5

3 Sierra Leone Africa 17.1 168 Grenada Caribbean 0.5

4 Mongolia Asia 14.0 169 Czech Republic Europe 0.3

5 Paraguay South America 11.0 170 Belgium Europe 0.2

6 Timor-Leste Southeast Asia 10.0 171 Venezuela South America 0.1

7 Iraq Middle East 9.0 172 Luxembourg Europe 0.1

7 Panama Central America 9.0 173 Swaziland Africa 0.0

9 The Gambia Africa 8.9 174 Hungary Europe 0.0

10 Mozambique Africa 8.4 175 France Europe -0.1

11 Dem. Rep. of the Congo Africa 8.3 176 Croatia Eastern Europe -0.2

12 Chad Africa 8.1 177 Netherlands Europe -0.5

13 China Asia 8.0 178 Islamic Republic of Iran Middle East -1.3

13 Lao P.D.R. Southeast Asia 8.0 179 Italy Europe -1.5

13 Côte d'Ivoire Africa 8.0 180 Spain Europe -1.6

16 Zambia Africa 7.8 181 Slovenia Eastern Europe -2.0

17 Turkmenistan Central Asia 7.7 182 Equatorial Guinea Africa -2.1

18 Rwanda Africa 7.6 183 Portugal Europe -2.3

19 Liberia Africa 7.5 184 San Marino Europe -3.5

20 Kyrgyz Republic Central Asia 7.4 185 Greece Europe -4.2

Estimated Growth in Output by Select Global Areas 2013 Projected

2.9%

2.5%

3.0%

3.0%

5.6%

7.8%

6.9%

2.5%

2.2%

5.1%

5.0%

1.7%

1.7%

0.9%

2.0%

-1.6%

-1.8%

0.3%

-0.2%

-0.6% 1.2%

-4.0% -2.0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0%

MexicoBrazil

Latin America and CaribbeanMiddle East and North Africa

IndiaChina

Developing AsiaRussia

Central/eastern EuropeSub-Saharan Africa

Emerging/developing countriesUnited States

CanadaUnited Kingdom

JapanSpain

ItalyGermany

FranceEuro area

Advanced economies

Annual % Change

Source: International Monetary Fund

Debt by Selected Country 2012

0 50 100 150 200 250

Saudi Arabia

Russia

China

Indonesia

South Africa

Mexico

Argentina

Brazil

India

Germany

Canada

United Kingdom

France

Spain

United States

Italy

Japan

General Government Gross Debt in Percent of GDP

Source: IMF

Top 12 Stock Exchanges 2011 Growth

Rank Exchange Index % Change

1 NYSE Group DJI A 5.5%

2 Nasdaq NASDAQ Composite -1.8%

3 London SE FTSE 100 -5.6%

12 Swiss Exchange Swiss Market Index -7.8%

9 TSX Group S&P TSX Composite -9.2%

8 Bolsa De Medrid IGBM -14.6%

6 Frankfurt SE DAX -14.7%

5 Euronext CAC 40 -17.0%

4 Tokyo SE Nikkei 225 -17.3%

11 Hong Kong Exchanges Hang Seng Index -20.0%

7 Shanghai SE Shanghai Composite -21.7%

10 Borsa Italiana FTSE MIB -25.2%

Source: Yahoo! Finance

Top 12 Stock Exchanges 2012 Growth

Rank Exchange Index % Change

6 Frankfurt SE DAX 29.1% 11 Hong Kong Exchanges Hang Seng Index 22.9% 4 Tokyo SE Nikkei 225 22.9% 2 Nasdaq NASDAQ Composite 15.9% 5 Euronext CAC 40 15.2%

12 Swiss Exchange Swiss Market Index 14.9% 10 Borsa Italiana FTSE MIB 7.8% 1 NYSE Group DJI A 7.3% 3 London SE FTSE 100 5.8% 9 TSX Group S&P TSX Composite 4.0% 7 Shanghai SE Shanghai Composite 3.2% 8 Bolsa De Madrid IBEX 35 -4.7%

Source: Yahoo! Finance

Rank Exchange Index % Change

4 Tokyo SE Nikkei 225 31.3% 2 Nasdaq NASDAQ Composite 19.3% 12 Swiss Exchange Swiss Market 16.7% 1 NYSE Group DJI A 15.1% 5 Euronext CAC 40 13.3% 6 Frankfurt SE DAX 10.2% 3 London SE FTSE 100 10.2% 10 BorsaItaliana FTSE MIB 8.6% 8 Bolsa De Madrid Madrid General 8.0% 9 TSX Group S&P TSX Composite 2.4% 11 Hong Kong Exchanges Hang Seng Index -0.6% 7 Shanghai SE Shanghai Composite -8.8%

Top 12 Stock Exchanges Year to date Growth Thru 8/16/13

S&P Select Sector Performance 2012

Source: Dow Jones, Standard & Poor’s

-5% 0% 5% 10% 15% 20% 25%

Utilities

Energy

Consumer Staples

Materials

Industrials

Technology

Health Care

Consumer Discretionary

Financial

-0.7%

0.3%

8.0%

8.5%

9.4%

11.7%

14.2%

19.9%

23.5%

12-month percent change

Retail Property Clock Q2 2013

Source: Jones Lang LaSalle

San Diego, Tampa, Los Angeles,

Orange County

16 Jones Lang LaSalle • Retail Outlook • United States • Q2 2013

Reading the clock

The Jones Lang LaSalle retail property clock demonstrates where

each market sits within its real estate cycle. Markets generally move

clockwise around the clock, with markets on the left side of the clock

generally landlord-favorable and markets on the right side generally

tenant-favorable.

More than half of the markets have moved to landlord-favorable,

as rents gradually head upward and vacancy continues to contract.

Chicago, DC, Atlanta, Orlando, San Diego, Los Angeles, Tampa and

Orange County are in a “bottoming market,” evidenced by slowing

rent declines and very little new construction. Dallas, Honolulu, Fort

Lauderdale, Boston, Palm Beach, Seattle, Houston, Miami, New York

City and San Francisco are in a rising market.

Retail property clock

Peaking market Falling market

Rising market Bottoming market

Chicago, Washington DC

New York City, Houston Boston, San Diego, Tampa, Los Angeles,

Orange CountyDallas, Fort Lauderdale,

Honolulu, Boston, Seattle,

Palm Beach,

Atlanta, OrlandoSan Francisco, MiamiSan Francisco, Miami

Chicago, Washington D.C.

Atlanta, Orlando

Dallas, Fort Lauderdale,

Honolulu, Boston, Seattle,

Palm Beach

New York City, Houston

0%

2%

4%

6%

8%

10%

12%

14%

16%

1.6%

4.0% 4.1% 4.9%

6.3% 6.8% 7.0% 7.4% 7.4%

8.8% 9.3% 9.3% 9.5%

11.0% 11.9% 11.9%

12.4%

14.5%

Shopping Center Vacancy Rates for Select Areas Q2 2013

Source: Jones Lang LaSalle

*Washington D.C. Q2 Net Absorption: -25,430 sf YTD Net Absorption: -2,281,339 sf

Second Quarter Earnings for Select Corporations Earnings per Share

Source: Dow Jones, Standard & Poor’s

Symbol Q2 2012 Q2 2013

Estimated Q2 2013

Reported Surprise Symbol Q2 2012

Q2 2013 Estimated

Q2 2013 Reported

Surprise

COF $2.20 $1.74 $2.13 $0.39 GE $0.38 $0.35 $0.36 $0.01

BTU $0.73 ($0.05) $0.33 $0.38 VZ $0.64 $0.72 $0.73 $0.01

VFC $1.11 $1.17 $1.27 $0.10 CMG $2.56 $2.81 $2.82 $0.01

YHOO $0.27 $0.26 $0.35 $0.09 COH $0.86 $0.89 $0.89 $0.00

UTX $1.58 $1.57 $1.65 $0.08 MMM $1.66 $1.71 $1.71 $0.00

HON $1.14 $1.21 $1.28 $0.07 UPS $1.15 $1.14 $1.13 ($0.01)

XRX $0.26 $0.24 $0.27 $0.03 MCD $1.32 $1.40 $1.38 ($0.02)

STI $0.50 $0.66 $0.68 $0.02 TXN $0.44 $0.44 $0.42 ($0.02)

AMD $0.05 ($0.12) ($0.10) $0.02 MSFT ($0.05) $0.74 $0.59 ($0.15)

DD $1.48 $1.27 $1.28 $0.01 FCX $0.80 $0.46 $0.22 ($0.24)

DOW $0.55 $0.63 $0.64 $0.01 CAT $2.54 $1.70 $1.45 ($0.25)

Federal Reserve Balance Sheet v. S&P 500 Index April 2008 – August 2013

500

700

900

1100

1300

1500

1700

1900

0.8

1.3

1.8

2.3

2.8

3.3

3.8

Ap

r-0

8

Jul-

08

Oct

-08

Jan

-09

Ap

r-0

9

Jul-

09

Oct

-09

Jan

-10

Ap

r-10

Jul-

10

Oct

-10

Jan

-11

Ap

r-11

Jul-

11

Oct

-11

Jan

-12

Ap

r-12

Jul-

12

Oct

-12

Jan

-13

Ap

r-13

Jul-

13

S&P 500 FRB Credit Reserve

$Trillions

Source: Federal Reserve Bank; Yahoo Finance

S&P 500 index depicted in orange

Source: Moody’s Economy

Recession Watch as of September 2013

Industrial Production March 2001 through July 2013

Source: Federal Reserve

The industrial production index measures the real output of the

manufacturing, mining, and electric and gas utilities industries.

80

85

90

95

100

105M

ar-0

1Ju

l-0

1N

ov-

01

Mar

-02

Jul-

02

No

v-0

2M

ar-0

3Ju

l-0

3N

ov-

03

Mar

-04

Jul-

04

No

v-0

4M

ar-0

5Ju

l-0

5N

ov-

05

Mar

-06

Jul-

06

No

v-0

6M

ar-0

7Ju

l-0

7N

ov-

07

Mar

-08

Jul-

08

No

v-0

8M

ar-0

9Ju

l-0

9N

ov-

09

Mar

-10

Jul-

10N

ov-

10M

ar-1

1Ju

l-11

No

v-11

Mar

-12

Jul-

12N

ov-

12M

ar-1

3Ju

l-13

Ind

ex

(20

07

= 1

00

)

(Base year: 2007)

Gross Domestic Product 1990Q1 through 2013Q2

-10%

-8%

-6%

-4%

-2%

0%

2%

4%

6%

8%19

90

Q1

199

0Q

4

199

1Q3

199

2Q2

199

3Q1

199

3Q4

199

4Q

3

199

5Q2

199

6Q

1

199

6Q

4

199

7Q3

199

8Q

2

199

9Q

1

199

9Q

4

200

0Q

3

200

1Q2

200

2Q1

200

2Q4

200

3Q3

200

4Q

2

200

5Q1

200

5Q4

200

6Q

3

200

7Q2

200

8Q

1

200

8Q

4

200

9Q

3

2010

Q2

2011

Q1

2011

Q4

2012

Q3

2013

Q2

Pe

rce

nt

Ch

an

ge

fro

m P

rece

din

g P

eri

od

(S

AA

R)

2013Q2: 2.5%

Source: Bureau of Economic Analysis

Contributions to GDP Growth by Component Q2 2012 – Q2 2013

Source: Bureau of Economic Analysis

-1.5

-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

Personal Consumption Government Spending Net Exports Gross Investment

1.3

0.1 0.1

-0.2

1.2

0.7

0.0

1.0 1.1

-1.3

0.7

-0.4

1.5

-0.8

-0.3

0.7

1.2

-0.2

0.0

1.5

SA

AR

(%

)

Q2-12 Q3-12 Q4-12 Q1-13 Q2-13

Red Card/ Pink Slip

-1000

-800

-600

-400

-200

0

200

400

600

Jan-0

2

Jul-

02

Jan-0

3

Jul-

03

Jan-0

4

Jul-

04

Jan-0

5

Jul-

05

Jan-0

6

Jul-

06

Jan-0

7

Jul-

07

Jan-0

8

Jul-

08

Jan-0

9

Jul-

09

Jan-1

0

Jul-

10

Jan-1

1

Jul-

11

Jan-1

2

Jul-

12

Jan-1

3

Jul-

13

Th

ou

sa

nd

s

Net Change in U.S. Jobs, BLS January 2002 through August 2013

Source: Bureau of Labor Statistics

August 2013: +169K

Source: Bureau of Labor Statistics

National Nonfarm Employment by Industry Sector August 2012 v. August 2013

-94

1

20

28

45

108

168

375

424

517

614

-200 0 200 400 600 800

Government

Information

Manufacturing

Mining and Logging

Other Services

Financial Activities

Construction

Education and Health Services

Leisure and Hospitality

Trade, Transportation, and Utilities

Professional and Business Services

Thousands, SA

All told 2,206 K Jobs gained

-12,000

-10,000

-8,000

-6,000

-4,000

-2,000

0

2,000

4,000

6,000

Dec

-07

Feb

-08

Ap

r-0

8

Jun

-08

Au

g-0

8

Oct

-08

Dec

-08

Feb

-09

Ap

r-0

9

Jun

-09

Au

g-0

9

Oct

-09

Dec

-09

Feb

-10

Ap

r-10

Jun

-10

Au

g-1

0

Oct

-10

Dec

-10

Feb

-11

Ap

r-11

Jun

-11

Au

g-1

1

Oct

-11

Dec

-11

Feb

-12

Ap

r-12

Jun

-12

Au

g-1

2

Oct

-12

Dec

-12

Feb

-13

Ap

r-13

Jun

-13

Au

g-1

3

Full-time

Part-time

Cumulative Job Growth Since December 2007: Full-time v. Part-time December 2007 – August 2013

Source: Bureau of Labor Statistics, Current Population Survey

Full-time: - 5.40 million Part-time: +3.25 million

Source: Bureau of Labor Statistics

U.S. Year-over-year Percent Change: 1.7%

Employment Growth, U.S. States (SA) July 2012 v. July 2013 Percent Change

Rank State % Rank State % Rank State %

1 Utah 3.2 17 Iowa 1.7 35 Hawaii 1

2 Arizona 3.1 17 Michigan 1.7 35 Illinois 1

3 Georgia 2.8 17 North Carolina 1.7 35 Kentucky 1

4 Colorado 2.7 17 Oregon 1.7 35 New Mexico 1

4 Idaho 2.7 22 California 1.6 39 Alabama 0.9

4 North Dakota 2.7 23 Maryland 1.5 39 New York 0.9

4 Texas 2.7 23 Vermont 1.5 39 Wisconsin 0.9

8 Washington 2.3 25 Connecticut 1.4 39 Wyoming 0.9

9 Mississippi 2.2 25 Virginia 1.4 43 Maine 0.8

10 Minnesota 2 27 Nevada 1.3 43 West Virginia 0.8

10 South Carolina 2 28 Arkansas 1.2 45 Nebraska 0.7

12 Florida 1.9 28 Kansas 1.2 45 Ohio 0.7

12 Indiana 1.9 28 Louisiana 1.2 47 Oklahoma 0.6

12 Montana 1.9 28 Massachusetts 1.2 48 District of Columbia 0.5

12 New Jersey 1.9 28 Tennessee 1.2 48 Pennsylvania 0.5

16 Missouri 1.8 33 New Hampshire 1.1 50 Rhode Island 0.2

17 Delaware 1.7 33 South Dakota 1.1 51 Alaska -0.5

Source: Bureau of Labor Statistics

U.S. Unemployment Rate: 7.4%

Unemployment Rates, U.S. States (SA) July 2013

Rank State Rate Rank State Rate Rank State Rate

1 North Dakota 3 18 Texas 6.5 35 Arizona 8

2 South Dakota 3.9 19 Idaho 6.6 35 Oregon 8

3 Nebraska 4.2 20 Wisconsin 6.8 37 Connecticut 8.1

4 Hawaii 4.5 21 Maine 6.9 37 South Carolina 8.1

5 Utah 4.6 21 New Mexico 6.9 39 Indiana 8.4

5 Vermont 4.6 21 Washington 6.9 40 Kentucky 8.5

5 Wyoming 4.6 24 Louisiana 7 40 Mississippi 8.5

8 Iowa 4.8 25 Colorado 7.1 40 Tennessee 8.5

9 New Hampshire 5.1 25 Florida 7.1 43 District of Columbia 8.6

10 Minnesota 5.2 25 Maryland 7.1 43 New Jersey 8.6

11 Montana 5.3 25 Missouri 7.1 45 California 8.7

11 Oklahoma 5.3 29 Massachusetts 7.2 46 Georgia 8.8

13 Virginia 5.7 29 Ohio 7.2 46 Michigan 8.8

14 Kansas 5.9 31 Arkansas 7.4 48 North Carolina 8.9

15 West Virginia 6.2 31 Delaware 7.4 48 Rhode Island 8.9

16 Alabama 6.3 33 New York 7.5 50 Illinois 9.2

16 Alaska 6.3 33 Pennsylvania 7.5 51 Nevada 9.5

Unemployment Rates, 20 Largest Metros (NSA) July 2013

Source: Bureau of Labor Statistics

Rank MSA UR Rank MSA UR

1

Minneapolis-St. Paul-Bloomington, MN-WI Metropolitan Statistical Area 4.9 10

Baltimore-Towson, MD Metropolitan Statistical Area 7.5

2

Washington-Arlington-Alexandria, DC-VA-MD-WV Metropolitan Statistical Area* 5.7 12

San Diego-Carlsbad-San Marcos, CA Metropolitan Statistical Area 7.8

3

Seattle-Tacoma-Bellevue, WA Metropolitan Statistical Area 5.8 13

St. Louis, MO-IL Metropolitan Statistical Area1 7.9

4

Dallas-Fort Worth-Arlington, TX Metropolitan Statistical Area 6.4 14

New York-Northern New Jersey-Long Island, NY-NJ-PA Metropolitan Statistical Area 8

5

Houston-Sugar Land-Baytown, TX Metropolitan Statistical Area 6.5 15

Philadelphia-Camden-Wilmington, PA-NJ-DE-MD Metropolitan Statistical Area 8.4

6

Boston-Cambridge-Quincy, MA-NH Metropolitan NECTA 6.6 16

Atlanta-Sandy Springs-Marietta, GA Metropolitan Statistical Area 8.6

7

San Francisco-Oakland-Fremont, CA Metropolitan Statistical Area 6.9 17

Chicago-Joliet-Naperville, IL-IN-WI Metropolitan Statistical Area 9.6

7

Phoenix-Mesa-Glendale, AZ Metropolitan Statistical Area 6.9 18

Los Angeles-Long Beach-Santa Ana, CA Metropolitan Statistical Area 9.8

9

Tampa-St. Petersburg-Clearwater, FL Metropolitan Statistical Area 7.3 19

Detroit-Warren-Livonia, MI Metropolitan Statistical Area 10.4

10

Miami-Fort Lauderdale-Pompano Beach, FL Metropolitan Statistical Area 7.5 20

Riverside-San Bernardino-Ontario, CA Metropolitan Statistical Area 11

*D.C. MSA Employment July 2013 vs. July 2012: +50.6K; +1.7%

Put me in, Coach

Aug-13 81.5

0

20

40

60

80

100

120

200

5

200

7

Feb

-08

Ap

r-0

8

Jun

-08

Au

g-0

8

Oct

-08

Dec

-08

Feb

-09

Ap

r-0

9

Jun

-09

Au

g-0

9

Oct

-09

Dec

-09

Feb

-10

Ap

r-10

Jun

-10

Au

g-1

0

Oct

-10

Dec

-10

Feb

-11

Ap

r-11

Jun

-11

Au

g-1

1

Oct

-11

Dec

-11

Feb

-12

Ap

r-12

Jun

-12

Au

g-1

2

Oct

-12

Dec

-12

Feb

-13

Ap

r-13

Jun

-13

Au

g-1

3

Conference Board Consumer Confidence Index 2005 – August 2013

Source: Conference Board

U.S. Retail and Food Service Sales January 2002 through July 2013

Source: Census Bureau

-15.0%

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%Ja

n-0

1A

pr-

01

Jul-

01

Oct

-01

Jan

-02

Ap

r-0

2Ju

l-0

2O

ct-0

2Ja

n-0

3A

pr-

03

Jul-

03

Oct

-03

Jan

-04

Ap

r-0

4Ju

l-0

4O

ct-0

4Ja

n-0

5A

pr-

05

Jul-

05

Oct

-05

Jan

-06

Ap

r-0

6Ju

l-0

6O

ct-0

6Ja

n-0

7A

pr-

07

Jul-

07

Oct

-07

Jan

-08

Ap

r-0

8Ju

l-0

8O

ct-0

8Ja

n-0

9A

pr-

09

Jul-

09

Oct

-09

Jan

-10

Ap

r-10

Jul-

10O

ct-1

0Ja

n-1

1A

pr-

11Ju

l-11

Oct

-11

Jan

-12

Ap

r-12

Jul-

12O

ct-1

2Ja

n-1

3A

pr-

13Ju

l-13

Jul-13 5.40%

Ye

ar

to Y

ea

r %

ch

an

ge

-0.40%

1.10%

1.40%

2.30%

2.90%

3.30%

3.80%

4.20%

4.90%

5.80%

7.90%

8.80%

11.80%

-2.0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0%

Electronics & Appliance Stores

General Merchandise Stores

Health & Personal Care Stores

Sporting Goods, Hobby, Book & Music Stores

Furniture & Home Furn. Stores

Food & Beverage Stores

Food Services & Drinking Places

Clothing & Clothing Accessories Stores

Gasoline Stations

Miscellaneous Store Retailers

Building Material & Garden Supplies Dealers

Internet, etc. Retailers

Motor Vehicle & Parts Dealers

12-month % change

Sales Growth by Type of Business July 2012 v. July 2013*

Source: Census Bureau

*July 2013 advanced estimate

15-Year & 30-Year Fixed Mortgage Rates January 1995 through August 2013

Source: Freddie Mac

3.49%

4.46%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%Ja

n-9

5Ju

l-9

5Ja

n-9

6Ju

l-9

6Ja

n-9

7Ju

l-9

7Ja

n-9

8Ju

l-9

8Ja

n-9

9Ju

l-9

9Ja

n-0

0Ju

l-0

0Ja

n-0

1Jul-01

Ja

n-0

2Ju

l-0

2Ja

n-0

3Ju

l-0

3Ja

n-0

4Ju

l-0

4Ja

n-0

5Ju

l-0

5Ja

n-0

6Ju

l-0

6Ja

n-0

7Ju

l-0

7Ja

n-0

8Jul-08

Ja

n-0

9Ju

l-0

9Ja

n-1

0Ju

l-1

0Ja

n-1

1Ju

l-1

1Ja

n-1

2Ju

l-1

2Ja

n-1

3Ju

l-1

3

Ra

te

15-yr 30-yr

0%

5%

10%

15%

20%

25%

3.3%

5.7% 6.7% 7.3% 8.0%

9.4%

12.1%

14.8% 16.4%

19.0% 19.9%

24.5% 24.9%

12-M

on

th %

Ch

ange

S&P/Case-Shiller Home Price Indices for Select Metros June 2013, 12-Month Percentage Change

Source: Standard & Poor’s

National Vehicle Sales June 2004 through August 2013 (SAAR)

Source: Autodata Corp.

0

5

10

15

20

25

Jun

-04

Oct

-04

Feb

-05

Jun

-05

Oct

-05

Feb

-06

Jun

-06

Oct

-06

Feb

-07

Jun

-07

Oct

-07

Feb

-08

Jun

-08

Oct

-08

Feb

-09

Jun

-09

Oct

-09

Feb

-10

Jun

-10

Oct

-10

Feb

-11

Jun

-11

Oct

-11

Feb

-12

Jun

-12

Oct

-12

Feb

-13

Jun

-13

Ve

hic

le S

ale

s (m

illi

on

s)

GM Ford Chrysler Honda Toyota Nissan Others

Conference Board Leading Economic Indicators Index August 2007 through July 2013

Source: Conference Board

-1.5%

-1.0%

-0.5%

0.0%

0.5%

1.0%

1.5%A

ug

-07

Oct

-07

Dec

-07

Feb

-08

Ap

r-0

8Ju

n-0

8A

ug

-08

Oct

-08

Dec

-08

Feb

-09

Ap

r-0

9Ju

n-0

9A

ug

-09

Oct

-09

Dec

-09

Feb

-10

Ap

r-10

Jun

-10

Au

g-1

0O

ct-1

0D

ec-1

0F

eb-1

1A

pr-

11Ju

n-1

1A

ug

-11

Oct

-11

Dec

-11

Feb

-12

Ap

r-12

Jun

-12

Au

g-1

2O

ct-1

2D

ec-1

2F

eb-1

3A

pr-

13Ju

n-1

3

On

e-m

on

th P

erc

en

t C

ha

ng

e

July 2013 = 96.0 where

2004=100

Fourth Quarter

• As predicted, first half of year was quite soft in terms of economic expansion as sequestration and tax hikes make their mark;

• Second half of year should be better, with growing likely to average a shade above 2 percent;.

• Many headwinds remain and the recovery could easily falter;

• Black swan threats: (1) Iran (2) Israel/Iran (3) Europe;

• Maryland has held its own to date, but there are major discrepancies between the household survey and the establishment survey – one of them is probably wrong; and

• We are an increasingly part-time nation – that looks like a problem.

Thank You

You can always reach me at abasu@sagepolicy.com

Please look for updates of information at www.sagepolicy.com.

Also, if you need us in a hurry, we are at 410.522.7243 (410.522.SAGE)

Please contact us when you require economic research & policy analysis.