20180802-NATIXIS-The_deterioration_in_the_quality_of_the_US_economy_5页_661kb

Flash Economics Summary

Core Content

This document discusses the structural deterioration in the quality of the US economy, focusing on the slowdown in productivity gains and total factor productivity (TFP) growth. It outlines five key factors that contribute to this decline, emphasizing the need for internal reforms rather than blaming external forces.

Main Points

• Productivity slowdown: The US economy is experiencing a noticeable decline in productivity, as shown in Chart 1A and 1B.
• Five causes of the decline:
  1. Poor education system: The US ranks below several developed countries in educational performance, as indicated by the OECD PISA scores (Table 1).
  2. Decline in skilled immigration: Immigrants have a higher education level than native-born Americans, and the reduction in immigration is lowering the overall educational quality of the labor force (Table 2).
  3. Decreasing R&D efficiency: The cost of generating new products or services has increased, as shown in Chart 3.
  4. Maturity of the new-technology sector: Employment in this sector is declining (Chart 4A), and productivity gains from new technologies are no longer as significant as before (Chart 4B).
  5. Rise in unsophisticated domestic services: These services have low productivity and are becoming a larger portion of the labor market, thereby reducing overall productivity (Charts 5A and 5B).

Key Information

• Recommendation: The document suggests that instead of blaming the rest of the world, the US should focus on addressing its internal structural issues.
• Data sources: The analysis is based on OECD PISA surveys, US Census Bureau data, and various economic charts.
• Legal disclaimers: The document is intended for professional and qualified investors only and is strictly confidential. It is not a personalized investment recommendation and does not constitute financial advice.
• Regulatory information: Natixis is supervised and authorized in multiple jurisdictions, including France, the UK, Germany, Spain, Italy, and the Dubai International Financial Centre (DIFC). It is also regulated in Australia and Hong Kong for specific purposes.

Conclusion

The document concludes that the US is suffering from a structural decline in economic quality, driven by declining education standards, reduced skilled immigration, inefficient R&D, mature technology sector, and increasing reliance on low-productivity domestic services. It calls for internal reforms to reverse this trend.

Disclaimer Summary

• The document is for professional and qualified investors only.
• It is strictly confidential and cannot be disclosed to third parties without consent.
• No liability is accepted for any use of the information.
• No financial advice is provided; the content is for informational purposes only.
• The views expressed are personal and may differ among authors.
• The document is not approved or licensed by any regulatory body in the GCC, Lebanon, or Canada.
• It is not registered as a dealer in Canada and is only available to wholesale clients in Australia.
• In Hong Kong, it is only for professional investors.
• The document does not take into account specific investment objectives, financial situations, or needs of any individual.

Regulatory Information

• Natixis is supervised by the European Central Bank (ECB).
• In France, it is authorized by the ACPR and subject to its supervision.
• In the UK, it is regulated by the FCA and the Prudential Regulation Authority (PRA).
• In Germany, it is supervised by the ACPR and subject to BaFin regulation.
• In Spain, it is authorized by the ACPR and rated by the Bank of Spain and CNMV.
• In Italy, it is authorized by the ACPR and regulated by the Bank of Italy and CONSOB.
• In Dubai, it is authorized by the DFSA.
• In Australia, it operates through Natixis Australia Pty Ltd (NAPL), which holds an Australia Financial Services License.
• In Hong Kong, it is for professional investors only.

This summary highlights the main causes and implications of the decline in US economic quality, as well as the legal and regulatory context of the document.