The arrival of the coronavirus pandemic in the United States in March 2020 and, perhaps more significantly, the lockdown measures that state and local governments imposed on Americans as their response had a major impact on how Americans spent money in 2020.

That much is evident from the results of the 2020 Consumer Expenditure Survey, which saw the average annual expenditures of American "consumer units" drop by 2.7% from their 2019 level. "Consumer units" is the affectionate nickname given by the BLS' data jocks to what are predominantly made up of U.S. households. Our first chart featuring data from the 2020 CEX survey shows that measure for each year from 1984 through 2020.

That's the big picture, but the Consumer Expenditure Survey breaks down the average annual expenditures of U.S. household consumer units into major categories of spending. Our second chart show the amount of spending from 1984 through 2020 for housing; transportation; life insurance, pension savings and Social Security; health expenditures and medical expenses; entertainment; charitable contributions; apparel and other products; and finally education, to rank them from largest to smallest.

The major categories of spending that rose in 2020 include housing; life insurance, pension savings and Social Security; and finally charitable contributions. Every other category fell, with the largest declines in expenditures for transportation; food; and apparel and other products.

This outcome confirms the extended negative impact of the various lockdown measures imposed by state and local governments. What's important to recognize here is that they continued in much of the country well beyond the two month-long recession that arrived when large population states first mandated their residents stay at home and shuttered businesses in March 2020 during the first wave of coronavirus infections in the U.S.

Our next chart presents the share of each of the major categories of household spending as a percentage of total annual average expenditures.

The most significant item here is housing, which jumped to represent 35% of the average American consumer unit household's spending, an all-time high for the data series.

Our final chart stacks all these major categories of household spending together to assemble the full picture of how the spending of American consumer unit households has changed each year from 1984 through 2020.

This last chart is one of our favorites, in part because the colors convey which major categories of spending have generally risen over time (the purple-shaded components) or fallen over time (the green-shaded components).

We'll be exploring the wealth of data contained within the 2020 Consumer Expenditure Survey more over the next several weeks.

Referencees

U.S. Bureau of Labor Statistics. Consumer Expenditure Survey. Multiyear Tables. [PDF Documents: 1984-1991, 1992-1999, 2000-2005, 2006-2012, 2013-2020]. Accessed 9 September 2021. 

We now have quarterly dividend futures data for the S&P 500 (Index: SPX) through the end of 2022. Here's what the future looked like as of the close of trading on 20 September 2021:

The past and projected data shown in this chart is from the CME Group's S&P 500 quarterly dividend index futures. The past data reflects the values reported by CME Group on the date the associated dividend futures contract expired, while the projected data reflects the values reported on 20 September 2021. Until the futures contracts for their indicated quarter expire, projected dividends will fluctuate with changing expectations of the future for the index' dividends per share.

Readers should note these projections indicate the amount of dividends per share to be paid out over the period covered by each quarters dividend futures contracts, which start on the day after the preceding quarter's dividend futures contracts expire and end on the third Friday of the month ending the indicated quarter. So for example, as determined by dividend futures contracts, the "current" quarter of 2021-Q4 began on Saturday, 18 September 2021 and will end on Friday, 17 December 2021.

That makes these figures different from the quarterly dividends per share figures reported by Standard and Poor, who reports the amount of dividends per share paid out during regular calendar quarters after the end of each quarter. This term mismatch accounts for the differences in dividends reported by both sources, with the biggest differences between the two typically seen in the first and fourth quarters of each year.

The S&P 500 (Index: SPX) had what Reuters called a 'rollercoaster' week, but when all was said and done, stock prices still fell within the expected range.

Or rather, the range that would be expected if investors were mainly focusing on 2022-Q1 in setting current day stock prices. Or on 2021-Q4, since there's not much difference between the expectations for this quarter and 2022-Q1 at this point of time.

As for the market's rollercoaster week, Friday, 17 September 2021 was a quadruple witching day, with a slew of options and futures contracts expiring. That includes the dividend futures contract for 2021-Q3, which as far as the alternative futures chart is concerned, is over.

If you read the marking moving headlines of the week below carefully, you can see why 2021-Q4 or 2022-Q1 are points of interest for investors looking forward in the story considering the timing of when the Fed will start tapering off its pandemic stimulus bond buying program, which it identifies as likely to happen in either November (2021-Q4) or in December (2022-Q1), where the quarters are defined by dividend futures contract expiration dates.

Monday, 13 September 2021

• Signs and portents for the U.S. economy:
• From zippers to glass, shortages of basic goods hobble U.S. economy
• U.S. consumers' inflation expectations highest since 2013, NY Fed says
• Oil rises to six-week high as U.S. supply concerns dominate
• U.S. grain exports sink as Gulf terminals struggle to recover from Ida
• Bigger inflation developing all over:
• Japan's wholesale inflation hovers near 13-yr high as material costs rise
• Key gauge of euro zone inflation expectations at highest since mid-2015
• BOJ minions thinking stimulus policies of previous boss were wrong:
• After the 'bazooka', Bank of Japan dismantles the work of its radical chief
• S&P 500 snaps losing streak as tax hikes, inflation data loom

Tuesday, 14 September 2021

• Signs and portents for the U.S. economy:
• Tamer US August CPI bolsters Fed's transitory inflation case
• Oil settles unchanged as latest storm spares U.S. energy sector
• Louisiana grain terminal reopens after Hurricane Ida as Nicholas rains arrive
• Bigger trouble developing in Japan:
• Japan's Q3 growth forecast more than halved on COVID-19 impact
• Bigger inflation developing all over:
• India's August WPI inflation quickens to 11.39%
• U.S. stocks close lower on worries over recovery, corporate tax hikes

Wednesday, 15 September 2021

• Signs and portents for the U.S. economy:
• Hurricane Ida, supply constraints slow U.S. factory production
• Record 60 cargo ships wait to unload at busiest U.S. port complex
• Positive signs in Australia, Japan, Eurozone:
• Australian consumers cheered by reopening plans as vaccinations surge
• Japan's machinery orders rebound in sign of capex recovery
• Euro zone production stronger than expected in July
• Bigger trouble developing in China:
• China's house of cards: Evergrande threatens wider real estate market
• China's cooling measures curb new home price growth, property investment
• China's factories, retailers stumble on COVID-19 disruptions
• ECB minions think Delta COVID is overrated and fear inflation hump, inflation hits multi-year high in Canada, UK:
• Markets may be overestimating Delta's impact on growth - ECB's Schnabel
• Analysis: ECB sees a new inflation 'hump' as prices surge
• Canada's annual inflation rate in August hits highest in nearly two decades
• UK inflation posts record jump to hit 9-year peak in August
• S&P 500, Dow gain on factory data, strong oil prices

Thursday, 16 September 2021

• Signs and portents for the U.S. economy:
• U.S. business inventory accumulation slows in July
• U.S. retail sales surprise to upside in strong boost to economy
• Oil prices steady as U.S. storm threat wanes
• U.S. Gulf crude oil ramps up after hurricane losses -data
• Fed minions have huge ethics problem:
• Fed's Powell orders sweeping ethics review after officials' trading prompts outcry
• Bigger trouble developing in Japan:
• Japan cuts economic view on weaker production, spending due to COVID revival
• Japan's hot exports growth cools as COVID-19 hits supply chains
• ECB minions wants to hike interest rates, gradually drop stimulus bond buys:
• ECB's Rehn warns governments to count on higher rates
• ECB's exit from crisis measures will be "very gradual": Rehn
• ECB's Lane reveals in private meeting inflation target may be hit by 2025 - report
• S&P ends modestly lower as rising Treasury yields offset robust retail data

Friday, 17 September 2021

• Signs and portents for the U.S. economy:
• https://www.reuters.com/article/global-oil/oil-falls-as-storm-hit-u-s-supply-trickles-back-into-market-idUSKBN2GD04M
• Fed minions debating when to start tapering off stimulus bond buys:
• November? December? Fed's 'taper' timeline tied to volatile jobs data
• ECB minions thinking no rate hikes through 2023, upset at leak of inflation forecasts, then leak more inflation forecasts:
• ECB's De Cos is not foreseeing an interest rate hike in 2023
• ECB faces call to end private meetings after Lane leak
• Some in ECB think inflation forecasts too pessimistic -Makhlouf
• Wall Street Closes Rollercoaster Week Sharply Lower
• "Monster reallocations" to stocks as U.S. tax threat recedes - BofA

With expectations for the future of U.S. interest rates often influencing investors, one resource for checking out recent trends you might find useful is the Daily Treasury Yield Curve Rates database from the U.S. Treasury.

In a sign the strange new world of innovation is becoming stranger, U.S. District Judge Leonie Brinkema ruled on 2 September 2021 that an artificial intelligence machines cannot be inventors under the U.S. Patent Act. That ruling contradicts rulings made in favor of AI systems being eligible to be granted patents in Australia and in South Africa and may influence patent applications and appeals currently under consideration in a number of other nations.

The case involves two patent applications filed on 29 July 2019 for a "neural flame" (ASN 16/524,350) and a "fractal beverage container" (ASN 16/524,532) filed by Stephen Thaler, whose DABUS artificial intelligence system is listed as the inventor, with Thaler as the AI system's owner listed as the assignee. In the plaintiff's argument advanced in the court case protesting the U.S. Patent and Trademark Office's earlier rejection of patent awards, Thaler would be the owner of any patent awarded for inventions generated by the artificial intelligence.

But as the judge ruled, because the AI system does not qualify as a person under the U.S. Patent Act, no U.S. patent will be awarded. Consequently, the U.S. patent office's rejection of the two DABUS' patent applications was upheld.

Rather than delve further into the legal considerations, the Inventions in Everything team was curious to see what kind of patentable innovations the DABUS AI system came up with. Here's the basic abstract describing the neural flame, whose purpose is to attract human attention:

The present invention discloses devices and methods for attracting enhanced attention. Devices include: an input signal of a lacunar pulse train having characteristics of a pulse frequency of approximately four Hertz and a pulse-train fractal dimension of approximately one-half; and at least one controllable light source configured to be pulsatingly operated by the input signal; wherein a neural flame emitted from at least one controllable light source as a result of the lacunar pulse train is adapted to serve as a uniquely-identifiable signal beacon over potentially-competing attention sources by selectively triggering human or artificial anomaly-detection filters, thereby attracting enhanced attention.

Here's the abstract for DABUS' fractal container invention:

A container for use, for example, for beverages, has a wall with and external surface and an internal wall of substantially uniform thickness. The wall has a fractal profile which provides a series of fractal elements on the interior and exterior surfaces, forming pits and bulges in the profile of the wall and in which a pit as seen from one of the exterior or interior surfaces forms a bulge on the other of the exterior or interior surfaces. The profile enables multiple containers to be coupled together by inter-engagement of pits and bulges on corresponding ones of the containers. The profile also improves grip, as well as heat transfer into and out of the container.

Because it's more visually interesting than DABUS' neural flame invention, here's an illustration of the AI system's fractal container:

Fans of fractal geometry will recognize the profile of the Koch Snowflake. The novel application that would be potentially patentworthy is its application for use as a beverage container, where the combination of an infinite perimeter with a finite cross-sectional area would in fact make it useful for transferring heat through its sides either to or from the beverage or fluid contained within. Here's an video overview of the Koch Snowflake from the Khan Academy:

The invention would have use in applications where its desirable to rapidly transfer heat either into or out of the sides of the container, such as in cooking, where fluted ramekins are often used for that purpose.

From the Inventions in Everything Archives

When IIE the IIE team has previously looked at beverage containing-related inventions, the goal of the inventor has often been to prevent or to minimize the amount of heating or cooling taking place across the walls of a beverage container. Here's where the IIE team has previously paid attention to the heat transfer properties of beverage-containing innovations:

• Keeping Your Beer Cold on a Hot Day
• Inventions in Everything: Geothermal Beer Coolers
• Inventions in Everything: The Beerbrella

The U.S. Census Bureau released its annual estimate for median household income in the U.S. for the 2020 calendar year on 14 September 2021. It reported median household income for the 2020 calendar year was $67,521.

If you compare that number with the official estimate of median household income of $68,703 reported for the 2019 calendar year, that is a 1.8% decline. But there was a big problem with the 2019 estimate. The Census Bureau was collecting the data that would be used to determine that figure in March 2020, when the coronavirus pandemic reached the U.S. and the lockdowns imposed by state and local governments to "flatten the curve" disrupted the Census Bureau's ability to collect data. It particularly affected the rate of responses for its Current Population Survey's Annual Social and Economic Supplement from lower income households, where many households in this demographic group did not respond.

Census Bureau analysts have estimated that had they been able to collect a more complete data sample, they would have estimated median household income to be $66,790 for the 2019 calendar year, which we first reported in October 2020. And that brings us to the most remarkable aspect of the median household estimate for 2020. If not for the disruptive effect of the pandemic lockdowns, median household income would have risen by 1.1% from the adjusted estimate for 2019 to 2020's official estimate.

The following chart shows the Census Bureau's estimates of median household income from 2018 through 2020, illustrating how different 2019's estimate would be when accounting for the pandemic's disruption.

Only the Census Bureau's official estimate for 2019 was significantly impacted by the coronavirus pandemic. It wasn't a factor at all in March 2019 when data was collected for the 2018 calendar year, and it wasn't a significant factor in March 2021 when data was collected for 2020. The data sources supporting our exclusive analysis are presented below.

References

U.S. Census Bureau: Jessica Semega, Melissa Kollar, John Creamer, and Abinash Mohanty. Report Number P60-266. Income and Poverty in the United States: 2018. [PDF Document]. 15 September 2020.

U.S. Census Bureau: Jessica Semega, Melissa Kollar, Emily A. Shrider, and John Creamer. Report Number P60-270. Income and Poverty in the United States: 2019. [PDF Document]. 15 September 2020.

U.S. Census Bureau: Jonathan Rothbaum and Adam Bee. Coronavirus Infects Surveys, Too: Survey Nonresponse Bias and the Coronavirus Pandemic. [PDF Document]. 3 May 2021.

U.S. Census Bureau: Emily A. Shrider, Melissa Kollar, Frances Chen, and Jessica Semega. Report Number P60-273. Income and Poverty in the United States: 2020. [PDF Document]. 14 September 2021.