One of the questions being asked by the business community is when the economy will recover and how. The Conference Board has offered their outlook in this new article. (This link takes you to the collection of Covid-19 related graphics. You have to find the right one from the carousel. I can't seem to find the direct link to that page.)

This chart summarizes their viewpoint:

TCB-COVID-19-US-level-of-GDP-1170

They considered three scenarios, starting the recovery in May, over the summer, and in the Fall. In all scenarios, the GDP of the U.S. will contract in 2020 relative to 2019. The faster the start of the recovery, the lower the decline.

My reaction to the map icon is different from the oil-drop icon in the previously-discussed chart (link). I think here, the icon steals too much attention. The way lines were placed on the map initially made me think the chart is about cross-country travel.

On the other hand, I love the way he did the horizontal axis / time-line. It elegantly tells us which numbers are actual and which numbers are projected, without explicitly saying so.

Tcb_timelineaxis

Also notice through the use of color, font size and bolding, he organizes the layers of detail, and conveys which items are more important to read first.

***

Trifectacheckup_imageAs I round out the Trifecta Checkup, I found a seam in the Data.

On the right edge, the number for December 2020 is 100.6 which is 0.6 above the reference level. But this number corresponds to a 1.6% reduction. How so?

This seam exposes a gap between how modelers and decision-makers see the world. Evidently, the projections by the analyst are generated using Q3 2019's GDP as baseline (index=100). I'm guessing the analyst chose that quarter because at the time of analysis, the Q4 data have not reached the final round of revision (which came out at the end of March).

A straight-off-the-report conclusion of the analysis is that the GDP would be just back to Q3 2019 level by December 2020 in the most optimistic scenario. (It's clear to me that the data series has been seasonally adjusted as well so that we can compare any month to any month. Years ago, I wrote this primer to understand seasonal adjustments.)

Decision-makers might push back on that conclusion because the reference level of Q3 2019 seems arbitrary. Instead, what they like to know is the year-on-year change to GDP. A small calculation is completed to bridge between the two numbers.

The decision-makers are satisfied after finding the numbers they care about. They are not curious about how the sausage is made, i.e., how the monthly numbers result in the year-on-year change. So the seam is left on the chart.

 

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