Household Credit Shifts Higher; Debt Burden Continues to Decline
During the last recession, the aggregate level of household credit began to fall, raising concerns about the prospects for the recovery. The decline suggested that consumers could be scaling back their demands for credit and lenders could be unwilling or unable to lend. Finally, in the last two quarters of 2013, the total level of outstanding household credit has begun to rebound. But even though household credit has risen, the debt burden has not.
How Fast Will Labor Productivity Grow in the Long Run?
Labor productivity in the nonfarm business sector grew rapidly in the second half of 2013, reaching an average 2.63 percent annual rate. This was the fastest two-quarter pace since the boost of productivity growth associated with the end of the Great Recession and the beginning of the recovery. Such a fast pace of productivity will not last long though.
Airline Hubs and Air Traffic Trends
Consolidation of air carriers has caused a steady retreat of hubs from mid-sized metropolitan areas like those of the Fourth District. Of the eleven largest airlines before the 1978 deregulation, the “legacy” carriers, all but three have folded or been absorbed via mergers. Since 1990, 15 metro areas have felt the sting of losing an airline hub. In the Fourth District, Pittsburgh lost its home-grown US Airways hub around 2004, and Cleveland will be losing its United Airlines hub this year. The Cincinnati/Northern Kentucky airport, while still nominally a Delta hub, has seen passenger departures reduced from over 10 million in 2005 to fewer than 3 million in 2013.