I thought this was both creative and correct.  Credit Suisse has decided to pay bonuses in a unique currency — toxic assets such as mortgage-backed securities.   This Bloomberg piece spells out the arrangement [emphasis added]:

Credit Suisse to use illiquid assets to pay bonuses (Bloomberg, December 18, 2008,  Christine Harper)

Credit Suisse Group AG’s investment bank has found a new way to reduce the risk of losses from about $5 billion of its most illiquid loans and bonds: using them to pay employees’ year-end bonuses.

The bank will use leveraged loans and commercial mortgage- backed debt, some of the securities blamed for generating the worst financial crisis since the Great Depression, to fund executive compensation packages, people familiar with the matter said. The new policy applies only to managing directors and directors, the two most senior ranks at the Zurich-based company, according to a memo sent to employees today.

“While the solution we have come up with may not be ideal for everyone, we believe it strikes the appropriate balance among the interests of our employees, shareholders and regulators and helps position us well for 2009,” Chief Executive Officer Brady Dougan and Paul Calello, CEO of the investment bank, said in the memo.

The securities will be placed into a so-called Partner Asset Facility, and affected employees at the bank, Switzerland’s second biggest, will be given stakes in the facility as part of their pay. Bonuses will take the first hit should the securities decline further in value.

“It’s monstrously clever,” said Dirk Hoffman-Becking, an analyst at Sanford C. Bernstein Ltd. in London who has a “market perform” rating on Credit Suisse stock. “From a shareholders’ perspective it’s great because you’ve got rid of some of the assets and regulators will be pleased because you’ve organized a risk transfer.”

…Credit Suisse is the first to use the debt to pay employees. Outside investors may also be permitted to invest in the facility, according to the people familiar with the matter, who declined to be identified because the plan hasn’t been made public. The bank will boost the potential for returns by providing leverage to the facility, and will be paid back first, according to the people.

…Assets in the facility will remain on Credit Suisse’s balance sheet and will be held in the company’s fund management division, the people familiar with the plan said. The new structure will mean that any mark-to-market losses or gains on the assets will be offset by identical gains, or losses, on the bank’s liability to employees…

Pretty clever.  As I understand this, the bank gets rid of toxic assets from its balance sheet when they go into this Partner Asset Facility (PASS).  PASS contributions offset cash the bank would otherwise have to pay to executives and, no doubt, the execs will view future investment decisions with a bit more sobriety.

I hope this idea catches on.

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Source: Wall Street Journal

Via: Greg Mankiw

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Hedge funds are having a very difficult year and, as a result, a number are closing or likely to close. This Bloomberg piece [emphasis added] gives a bit of background on tough times in hedge fund land:

Third of Hedge Funds Face ‘Wipeout’ After Slump (Bloomberg, December 15, 2008, Tom Cahill)

Almost a third of hedge funds will shut or merge after the $1.5 trillion industry posted its worst ever performance this year, according to IGS Group, which advises hedge funds on raising money.

“The failure rate is going to go up, the closure rate is going up, and the merger rate is going up,” IGS Chief Executive Officer John Godden said in an interview in London. “It’s going to be a 30 percent wipe out.”

The number of hedge funds more than tripled in the last decade to a record 10,233 at the end of June, according to Chicago-based Hedge Fund Research Inc. That number will likely tumble after funds dropped 18 percent in the year through November, the worst year since HFR started its Fund Weighted Composite Index in 1990.

…Hedge funds typically charge a 2 percent management fee and keep 20 percent of profits, while funds-of-hedge-funds typically charge 1 percent and 10 percent of profits. Profits are usually based on high-water marks that could take years to reach again.

…Funds of hedge funds, in particular, are likely to combine, Godden added. There are roughly three funds-of-funds for every single hedge fund, up from one to seven in 2001, according HFR…

As hedge funds close and investors withdraw their money, the hedge fund itself has to sell a proportionate amount of holdings.  To the extent, the hedge fund was leveraged, it might have to sell several times the amount of assets being withdrawn.

This pattern of withdrawals from hedge funds probably accounts for a fairly significant chunk of the selling in stocks and bonds that we have seen over the past few months (see Hedge Fund Withdrawals Roil Markets and Bonds Markets Pricing In Armageddon).

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Given the big drop in energy prices, it is not surprising that the cost of living fell in November.  However, the size of the decrease in the Consumer Price Index (CPI) was a bit startling as this release from the Bureau of Labor Statistics indicates [emphasis added]:

Consumer Price Index — November 2008 (Bureau of Labor Statistics, December 16, 2008)

On a seasonally adjusted basis, the CPI-U [CPI for all urban residents] decreased 1.7 percent in November, the second consecutive record decrease. For the 12 month period ending in November the CPI was up 1.1 percent, compared to 5.6 percent for the twelve months ending July of this year. Falling energy prices, particularly gasoline, drove the decline in the overall index…

…Excluding food and energy, the CPI was virtually unchanged in November and is up 2.0 percent since November 2007. Continuing declines in the indexes for new and used motor vehicles, lodging away from home, airline fares and some technology-related commodities offset small increases in a variety of other service and commodity items…

In a year of many surprises — mostly unwelcome surprises — this is a mixed blessing.  I’m happy that inflation is falling.  However, the underlying cause is not that we have our financial house in order.  In fact, it’s quite the opposite.  The circumstances are that the economy is suffering and falling prices are symptom of the economic malaise.  It does show how quickly things can turn around though.  As of July, 2008, year-over-year inflation was up 5.6%.  Fast forward to November, 2008 and year-over-year inflation is up only 1.1%.  Wow.

See also Inflation versus Deflation.

For much more on inflation, I recommend our series:

Part One:  Does the Government Understate Inflation?

Part Two: Does the Government Understate Inflation? — Bill Gross Says Yes

Part Three: Does the Government Understate Inflation? — Don Boudroux & Russell Roberts Say No

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The title of this post is from an old joke line about Fords.  “You know what Ford stands for,” asked a mechanic I knew many years ago.  “Fix or repair daily,” he replied. Then, he went on with a cackle.  Actually, it’s, “Found on road dead.”  There was another version he had that’s not fit for a family publication.

Of course, he was a Chevy guy.  In fact, he owned around 40 of them. In all fairness, I have a buddy who has always owned Fords and he loves to badmouth competitive offerings from Chevy, Dodge and Toyota.   Despite all the tasteless jokes, Ford may have the last laugh when it comes to competing with General Motors.   This column from automotive columnist Jerry Flint explains [emphasis added]:

Ford’s Focus (Forbes, December 16, 2008, Jerry Flint)

Ford Motor is suffering from guilt by association. The automaker has $15 billion or so in the bank and billions more in credit lines, is not looking for a year-end bailout and still gets splashed with mud. Every day I hear the TV news people, the stars like CNBC’s Maria Bartiromo, lump General Motors, Ford and Chrysler together as facing bankruptcy. In Ford’s case, this is just not true.

Alan Mulally, the chief executive Ford imported from Boeing… has moved smartly since he gave up his wings. He mortgaged assets (for $24 billion) and signed up credit lines two years ago before all the current turbulence.

Ford is actually in pretty good shape it seems.  Why?  Well, the CEO apparently was concerned about cash flow so he mortgaged the company’s assets (reputedly including the blue Ford logo) for a big chunk of cash.   He also sold off a number of car lines to streamline the company. Now, those moves seem to be coming in handly.

He also sold Jaguar, Land Rover, Aston Martin, some of Ford’s Mazda…stake and has put Volvo on the block. You can disagree or agree, maybe some of these operations could still have turned into winning assets, but Mulally decided Ford did not need the problems right now.

Unlike GM, Ford has no surplus car lines, which means it avoids both heavy spending to keep too big a lineup up-to-date and endless lectures from Wall Street know-it-alls who say to get rid of them. Excluding Volvo, which Ford hopes to sell, and Mazda Motor, in which it has only a minority stake, Ford has only two dealership channels in this country: Ford and Lincoln/Mercury.

...Long run, Ford has the ability to grow. For the past two months the Dearborn, Mich., manufacturer has held its own in share against the prior year, while the others slipped. The company even picked up share in November, to 16.4% of the industry sales versus 15.4% a year before. This is a good sign. If GM downsizes, Ford could end up bigger than GM in just a few years.

See also GM & Toyota: A Tale of Two Car Companies.

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Here we have a tale of two car companies — GM and Toyota.  Last year, both companies sold lots of car and trucks.  In fact, total worldwide sales were almost the same so each company did pretty well.

Chart: Fundmasteryblog                  Data: Mises Economics Blog

This piece by Ralph Reiland at the Mises Economics Blog has the data we used to create these charts [emphasis added]:

Mismanagement at the Big Three (Mises Economics Blog, December 9, 2008, Ralph Reiland)

It was a dead heat. General Motors sold 9.37 million vehicles worldwide in 2007…Toyota sold 9.37 million vehicles in 2007…

Chart #2 shows profit or loss per unit sold between GM and Toyota:

Chart: Fundmasteryblog                  Data: Mises Economics Blog

Ouch.  So, GM had a great year for sales last year yet it still lost money on each vehicle sold.  In fact, it lost $4,100 per sale.  Toyota sold approximately the same number of vehicles yet it made $1,800 per unit sold.  I once saw a late night TV ad in which the huckster said something to this effect, “We lose money on every sale, but we make it up in volume.”  In the real world, if you lose money on every sale, more volume equals more losses. Though you can imagine what is coming next, you will still be amazed at the magnitude of the dollar differential:

Chart: Fundmasteryblog                  Data: Mises Economics Blog

Just to reiterate, in 2007, on nearly identical unit sales, GM lost $38.7 billion and Toyota made $17.1 billion.  That’s a whopping differential of $55.8 billion.  Of course, this year GM (Toyota too) is dealing with much lower sales volume than they had in 2007 so they will probably lose even more money per unit sold.  Not only is this bad from a profit and loss perspective, but it is even more critical when it comes to viability as a going concern.  Reiland continues:

Collectively, Detroit’s Big Three automakers are currently losing about $5 billion per month, with Ford, General Motors and Chrysler, respectively, burning through $2 billion, $2 billion and $1 billion in cash every 30 days.

…General Motors and Chrysler added a “rush” to their latest bailout request, telling D.C.’s lawmakers that they need, respectively, an immediate $4 billion and $7 billion to ensure minimum liquidity levels, paid prior to the end of December. GM, as well, asked for an additional $4 billion for January and a third handout of $2 billion in the February/March time frame to forestall a financial calamity, plus a $6 billion line of credit from the federal government to ensure ample liquidity.

All told, GM says it needs an $18 billion taxpayer bailout, some 50 percent more than it said it needed just three weeks ago to turn things around…

As I read this, it would take about $5 billion in government handouts per month to keep these entities afloat.  That’s $60 billion a year.  But, the projected tab is going up almost daily so it will probably get worse.  Let’s say the government does give them a loan to tide them over until next year.  Does anyone think that GM can somehow muddle through this crisis with minor changes?  Does anyone think that a few billion dollars is going to make any difference in how GM — or any other domestic car companies — operates?  After all, if you lose money on every sale, it’s hard to make a profit.

One legitimate point in favor of the bailout is that this is a horrendous year to have GM declare bankruptcy.  The shock of a bankruptcy filing would hit hard in an already difficult economic environment.  In addition, once a bankruptcy filing is made, there is no telling what will happen.  Those points are fair enough.

The contrary argument is that the domestic car companies’ basic business model is broken.  You’ll see plenty of stories about GM’s troubles and about a potential government loan or bailout.  But, what you won’t see in most articles about the company is a succinct demonstration about why GM is close to failure.  However, in our effort to give you insights into the truth behind the headlines, we present the following chart which shows the total cost for U.S. workers at GM, Ford and Chrysler versus Toyota and across the spectrum of domestic goods producing industries.  This includes the hourly pay plus benefits plus additional costs related to retiree pension and healthcare benefits plus the cost of the notorious Jobs Bank.In addition to management problems, quality problems and other issues, GM is stuck with very high cost production labor as you can see below:

Source: Carpe Diem

Due to very strict contracts with the United Auto Workers union, the Big Three automakers (GM, Ford, Chrysler) are saddled with labor costs that are roughly 50% higher than Toyota is paying workers at factories here in the U.S.  In addition, there are silly requirements such as the Jobs Bank that requires the Big Three to pay workers that are not even working.  In addition, there are strict work rules that limit flexibility, cross training and other normal business practices. For an in-depth look at this issue of employment costs at domestic auto companies, see this Heritage Foundation report.

Having grown up in Michigan, I can attest that the U.S. auto makers have had plenty of bad management decisions and design and quality problems so it is not enough to suggest that all problems stem from ultra high labor costs.  In fact, Toyota generally has significantly higher quality and customer satisfaction ratings than GM or Ford or Chrysler.  However, GM has made great strides in producing competitive cars recently.  Examples include the Chevy Malibu, which is very competitive with the Toyota Camry.  Also, GM is producing the Chevy Volt, which could be the first electric production car.  GM has responded to the marketplace, but its ability to do so is certainly hampered by its legacy issues.

In this excellent piece by John Tamny, editor of Real Clear Markets, Tamny makes the argument that we should simply let GM file bankruptcy.  RCM is one of the sites I visit daily because it is a great source for articles and blog posts on financial and economic issues [emphasis added below].

Time to Pull the Plug on GM (Real Clear Markets, November 11, 2008, John Tamny)

…The latest losses at General Motors reveal yet again that it is the living embodiment of managerial ineptitude, and to insure that it no longer fails its customers while harming the well-being of Americans more broadly, it’s essential to let the firm die.

Many will of course blanch at the presumed loss of jobs that would result from GM’s death, but judging by the high level of unemployment in Michigan, it would be more realistic to say that GM’s continued existence under weak management has served as a capital repellant such that capital and jobs will continue to flee the state if GM is saved with the money of others. Worse, business history, from ships to farming to mining, shows that sectors reliant on government help are invariably weakened as opposed to strengthened.

The above is the case because businesses rarely fail due to a lack of money. Instead, poorly run businesses find it hard to raise money in the capital markets. Government money allows the architects of bad decisions to continue making mistakes that cause a company to be capital deficient to begin with.

This distinction is important considering the efforts of GM’s present management to secure more funds on top of the low interest loans that Congress recently approved. Were GM well managed it would have no need to run to the federal government, but because its management has proven time and again that it lacks ability, capital is correctly searching for better opportunities.

…So in a sense there’s a moral aspect to letting GM implode. Indeed, with companies not in the auto sector presently shedding workers due to a lack of funds, how could Obama or the outgoing administration take even more precious capital from the private sector in order to keep alive a firm notorious for its prodigious misuse of the money offered it?

The better answer for a capital-starved economy would be for the federal government to once again get out of the way, and in doing so, let funds flow to the very best ideas to insure as quick a recovery as possible. Importantly, if investment proves non-existent for GM absent government largess, it’s a certainty that foreign carmakers will step in amid the firm’s bankruptcy in such a way that job losses will be much less of a problem than is often assumed.

…In the end, the state of Michigan and the U.S. automobile sector are struggling not due to back luck, but precisely because they cling to a company that investors no longer value. And with GM shares near all-time lows, those with capital are stating loudly that so long as GM remains as is, the funds necessary for job creation will continue to flee.

So rather than waste precious capital in the naïve hope of propping up that which investors don’t value, it’s essential to let GM fail. Only then will a necessary change of ownership occur; the latter change the only solution when it comes to properly utilizing assets whose misuse is presently destroying a formerly great company, not to mention the economic health of the state in which it is headquartered.

Assuming GM does go into bankruptcy, that should not have an immediate effect on employment and its normal operations as this piece from the Wall Street Journal [emphasis added] on the recent bankruptcy filing of the Tribune Company demonstrates.

Tribune Co. filed for Chapter 11 bankruptcy protection Monday, bruising billionaire Samuel Zell’s ambitious effort to rescue the media company and reshape the ailing newspaper industry.

…The bankruptcy filing covers Tribune’s eight major daily papers, including the Los Angeles Times and Chicago Tribune, as well as the company’s string of local television stations. Tribune’s Chicago Cubs baseball franchise, in which the company is trying to sell an interest, wasn’t included in the filing.

The filing gives Tribune breathing room to rework its debt, and Mr. Zell said the company will continue to operate normally. He added that the company expects to remain intact, but he is open to selling other assets besides the Cubs…

The Tribune Company is a large media company with multiple newspapers and other assets including the Los Angeles Times, the Chicago Tribune, television stations and even the Chicago Cubs.  The point of the bankruptcy filing was to allow the company to continue normal operations while it restructures its businesses to become profitable again.  Bankruptcy is not the end of the line, but rather an organized restructuring of a company.  And, so far, normal operations are continuing at those Tribune subsidiaries.

Getting back to GM, from a political perspective, a bailout may be inevitable.  But, a bailout won’t work over the long haul unless GM changes the cost structure shown above and the bailout plan being discussed says little or nothing about amending the union contracts. Second, why should Americans (who generally make far less than autoworkers make) be asked to pay taxes in order to preserve the jobs of overpaid autoworkers?

One big issue hangs over the domestic automakers and that is, what will happen to retirees who rely on the company for pensions and health insurance? Unfortunately, it is almost certain that a bailout will not work unless GM makes radical changes on those very issues of retiree benefits.  However, even that is not enough.  GM will have to make many other changes — obtaining competent leaders, improving its product line and changing its bloated dealership structure to name a few. But, the likelihood of all of those improvements being made in a timely fashion is pretty low in my opinion.

If there is a bankruptcy at GM, we should certainly do something to mitigate the pain suffered by its employees and its retirees, but dealing with that issue can wait until we find out whether or not GM joins the bailout bonanza (see Bailout Bonanza for Bad Businesses — Will it ever end?).

Update:

Nobel Laureates for bankruptcy.  Now there’s a catchy phrase.

Gary Becker and Joseph Stiglitz have both have won the Nobel Prize in Economics and both believe bankruptcy is the proper solution for GM and the other domestic automakers.  Becker also addresses the issues of warranties and whether or not this would be a bad time for them to go in Chapter 11.  Here are excerpts from each [emphasis added]:

Here’s Becker:

I believe…that the big three auto companies should be allowed to go bankrupt. This sharp recession is actually a good rather than bad time for them to go bankrupt. The global auto industry is in a deep depression, and GM, Ford, and Chrysler have been among the hardest hit. GM said that it expects to produce about 30 percent, or 250,000, fewer cars in the first quarter of 2009 than it did in the comparable quarter of 2008. It is temporarily closing about 20 North American factories in order to make these production cuts. Since they cannot sell their cars anyway because of the depression in car demand, especially for their cars, any disruptive effects bankruptcy would have on their production actually helps them adjust their production of cars to the reduced demand for these cars.

GM and the other carmakers have claimed that bankruptcy would have a particularly big effect on sales because consumers would fear that their warranties on the cars they bought could not be honored in the future. Whether this is true or not would depend on whether consumers expect these companies to emerge from bankruptcy in the future as stronger rather than weaker companies compared to a bailout. If they expect bankruptcy to lead to better labor conditions for the company and smaller debts, bankruptcy would give consumers more rather than less confidence that their warranties would be honored in the future. 

Here’s Stiglitz:

…What needs to be done is to help the automakers get a fresh start and allow them to focus on producing good cars rather than trying to juggle their books to meet past obligations.

The US car industry will not be shut down, but it does need to be restructured. That is what Chapter 11 of America’s bankruptcy code is supposed to do. A variant of pre-packaged bankruptcy – where all the terms are set before going before the bankruptcy court – can allow them to produce better and more environmentally sound cars. It can also address legacy retiree obligations. The companies may need additional finance. Given the state of financial markets, the US government may have to provide that at terms that give the taxpayers a full return to compensate them for the risk. Government guarantees can provide assurances, as they did two decades ago when Chrysler faced its crisis.

With financial restructuring, the real assets do not disappear. Equity investors (who failed to fulfil their responsibility of oversight) lose everything; bondholders get converted into equity owners and may lose substantial amounts. Freed of the obligation to pay interest, the carmakers will be in a better position. Taxpayer dollars will go far further. Moral hazard – the undermining of incentives – will be averted: a strong message will be sent…

Those who believe bankruptcy would be a bad solution would do well to read these pieces.

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Source: Calculated Risk

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If you find the title of this post shocking — particularly in view of the current economic situation — you are not alone.  Yet, polls have consistently shown that Americans are generally happy and satisfied with their lives.  And, a very recent poll found that 56% of Americans think their personal financial situation is either excellent or good.

Admittedly, this is a bit different from what we see and hear in the media right now.  Here is a chart we produced based on data from a November 13, 2008 poll by the Quinnipiac University Polling Institute.

Chart: Fundmasteryblog

Data: Quinnipiac University

Here are the actual question from the poll that piqued my interest:

32. Would you describe the state of the nation’s economy these days as - Excellent, good, not so good, or poor?

34. Would you describe the state of your own personal finances these days as: Excellent, good, not so good, or poor?

Putting the responses together points to a fundamental and revealing difference in our perception of the overall economy versus our perception of our own personal finances:

Adding up the responses, the poll indicates that only 4% of Americans think the economy is excellent / good.  However, 56% say their own personal finances are excellent / good.  And, 95% believe the economy is not so good / poor, but when the question is about their personal situation, the number drops considerably to just 43% who think their own personal finances are not so good / poor.

If you find this confusing, you are not alone. However, these results are consistent with other polls from Gallup and Pew (see Gallup — Most Americans Very Satisfied With Their Lives and The Happiness Gap — Economy, Jobs, Money & Government).

Americans tend to be happy and satisfied with their lives, but they think others are not.   In this Quinnipiac poll, the same dichotomy is at work. That is, Americans think the economy stinks, yet they are still quite happy with their personal financial situation.

Update: 

This post elicited a bit of confusion or skepticism in the comments, so I thought I would clarify things a bit.  The survey from Quinniapiac also addressed the question of our outlook for the economy and personal finances.  Again, Americans are somewhat gloomy about the economy, but still quite optimistic about the outlook for their personal situations.  Here are two additional questions:

33. During the next 12 months, do you think the economic conditions in the United States will get better, get worse, or stay about the same?

1. Get better            40%
2. Get worse            19%
3. Stay the same      38%
4. DK/NA                   3%

36. During the next 12 months, do you think your own personal finances will get better, get worse, or stay about the same?

1. Get Better            38%
2. Get Worse            12%
3. Stay the same       47%
4. DK/NA                    3%

As you can see, 57% believe the economy will either stay weak or get worse.  Yet, 85% believe their personal situation will either get better or stay the same and only 12% think it will get worse.

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One way to value a publicly-traded company is to compare the total value of its shares to actual cash on the balance sheet.  In boom times, very few stocks would have more cash on hand than the company’s market capitalization, but these aren’t exactly boom times.  This piece from Bloomberg points out that a number of companies have more cash on hand than the total value of the company’s shares [emphasis added]:

Cheapest Stocks Since 1995 Show Cash Exceeds Market (Bloomberg, December 8, 2008, Michael Tsang and Alexis Xydias)

Stocks have fallen so far that 2,267 companies around the globe are offering profits to investors for free. That’s eight times as many as at the end of the last bear market, when the shares rose 115 percent over the next year.

Bank of New York Mellon Corp. in New York, Danieli SpA in Buttrio, Italy and Seoul-based Namyang Dairy Products Co. hold more cash than the value of their stock and debt as the slowing world economy wiped out $32 trillion in capitalization this year. Companies in the MSCI World Index trade for an average $1.17 per dollar of net assets, the lowest since at least 1995, and 39 percent sell at a discount to shareholder equity, data compiled by Bloomberg show.

…BNY Mellon is among 49 companies with a market capitalization greater than $1 billion that hold more cash than the value of their stock and debt, out of 2,267 overall, data compiled by Bloomberg show.

“Everywhere I look, I see cash,” said James Paulsen, chief investment strategist at Minneapolis-based Wells Capital Management, which manages $220 billion. “When greed overcomes fear again, value is going to wag the dog.”

Stocks plunged this year after almost $1 trillion in bank losses and writedowns froze credit markets and pushed the U.S., Europe and Japan into the first simultaneous recessions since World War II. The 39 percent drop in the Standard & Poor’s 500 Index is the steepest since 1931, while the MSCI World’s 44 percent plummet is the biggest since the gauge started in 1970.

The slump left prices in the global measure at 1.17 times companies’ so-called book value, or assets minus liabilities, on Nov. 20, the lowest on record, data compiled by Bloomberg show.

…Businesses with reserves will be cushioned from insolvency and may even benefit from deflation because buying power and the value of dividends increase as prices retreat, said Arlene Rockefeller, chief investment officer for global equities at State Street Global Advisors, which oversees $1.7 trillion.

“You want stocks with good cash flow and are self-funding,” Rockefeller said in an interview last week. “This is an opportunity for companies that are large and that do not have a lot of debt to go out and acquire other companies to gain market share.” …

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I thought this was interesting because it indicates that even though mortgage delinquency rates are pretty high now at about 7%, they have been quite high for decades.

Source: Calculated Risk

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