Sic Semper Tyrannis

So Ford announced today that it lost about $5.8 billion in Q3.

The NYTimes article in which I spotted this story had a nice chart of Ford's profits over the last 15+ years. The chart was supposed to illustrate profit vs. executive tenure for this period, but frankly, it is obvious there is little if any causal pattern in the data connecting these two aspects. But the efforts of the Times' chartists were not for naught -- I did notice some far more interesting and compelling patterns, which are marked up in my version of the chart below:

Follow up:

(Click for full version. Note that the past two recessions, according to NBER, are shaded in light red).

I have named the new chart "It's The Economy, Stupid", for reasons that will be made clear below.

Some key observations:

• The huge single-quarter declines seem to happen at the tail end of "official" recessions (or soon thereafter)
• The longest stretch flush with profits spans about '93-'00; which includes one recession recovery and, most notably, the liquidity boom that begin in '95 (which of course generated the notorious stock market bubble)
• The boundary between the above two is notable as a significant profit drop in '95.. seemingly coinciding with the (semi-notorious) "phantom recession" event that happened around then.

And two glaring questions:

1. Why has Ford just had a gigantic quarterly loss if we are not having a recession?
2. Why have profits been so shoddy continuously since '00, if we ever came out of the '01 recession? (consider that this period coincides with an unbroken trend of declining median compensation and low consumer sentiment)

My hypotheses in response to this data (which happen to render it a lot more consistent):

1. Ford is very (consumer) economy-sensitive. There is little to Ford other than a business that does OK when the economy is doing well, and does poorly (loses money) when it isn't. Ergo, the exec at the helm doesn't make much difference.
2. Ford is therefore a good barometer of the general economy.
3. We're either in or headed into a major recession event (or worse) -- Ford doesn't just suddenly lose almost $6 billion unless something is wrong with the economy.
4. We likely never meaningfully exited the recession in '01, which probably in actuality extended back to '00. That is likely a major thing that is wrong with the economy.
5. The '90-'91 recession probably lasted at least until '92, looking at the above numbers.
6. In fact, official (NBER) recession dating is probably methdologically deceptive, given flaws (lies) in the GDP calculation, inflation calculation, and labor pool statistics calculations. Most of the above recessions probably started earlier and lasted longer than "official" dates. Just ask Ford.

Another interesting puzzle in this data is why the '95-'00 liquidity-boom profit era seems to induce 3-5 quarter-long "waves" of increasing profits in successive "ascending staircases", then after the '00-'02 crash, this seems to switch to 3-5 quarter down-waves in "descending staircases". Weird, huh? Anyone have an explanation for this?