ECRI Leading Economic Index Plunges At -6.9% Rate, Back To December 2007 Levels When Recession Officially Started

Tyler Durden's picture

It's getting close: the fabled -10% annualized change (see David Rosenberg) which guarantees a recession is now just 3.1% away, which at this rate of collapse will be breached in two weeks. The ECRI is now at December 2007 levels, the time when the last recession officially started. The index dropped from an annualized revised -5.8% (previously -5.7%) to -6.9%. As a reminder, from Rosie, "It is one thing to slip to or fractionally below the zero line, but a -3.5% reading has only sent off two head-fakes in the past, while accurately foreshadowing seven recessions — with a three month lag. Keep your eye on the -10 threshold, for at that level, the economy has gone into recession … only 100% of the time (42 years of data)." We are practically there.

Shorter-term...

And a more dramatic longer-term chart:

 

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papaswamp's picture

yowch!....here comes the next round of stimuli.

Translational Lift's picture

Nah....Nothing to worry about...the UM cci is up to 76!!

Bwhaaaaaaaaaaa

Translational Lift's picture

Nah....Nothing to worry about...the UM cci is up to 76!!

Bwhaaaaaaaaaaa

SignsAndWonders's picture

But consumer confidence is up!!!  BUYBUYBUY

Assetman's picture

Oh... and if you look close enough, the ECRI hit a positive second derivative. 

I mean... who cares if the numbers are negative, and that second derviatives are headfakes 50% of the time???

Eally Ucked's picture

You mean the acceleration of acceleration is going down? What about third derivative? Or fourth?

I love it!

Hephasteus's picture

Or that the markets keep trying to put shoulders on everything to show "support".

Muir's picture

Toooo gloomy

My response:

 

__

Allan: That's quite a lovely Jackson Pollock, isn't it?
Museum Girl: Yes, it is.
Allan: What does it say to you?
Museum Girl: It restates the negativeness of the universe. The hideous lonely emptiness of existence. Nothingness. The predicament of Man forced to live in a barren, Godless eternity like a tiny flame flickering in an immense void with nothing but waste, horror and degradation, forming a useless bleak straitjacket in a black absurd cosmos.
Allan: What are you doing Saturday night?
Museum Girl: Committing suicide.
Allan: What about Friday night?

 

__

Joe Shmoe's picture

And, remember how long it took the Fed to actually cave in and admit to the recession in teh first place?

 

Don't they call it suasion?  As in they think they're trying to bolster confidence by saying good calming things to the huddled masses so that everything will work out okay?  How'd that work out for Hoover?

Gully Foyle's picture

Joe Shmoe

"And, remember how long it took the Fed to actually cave in and admit to the recession in teh first place?"

They have yet to admit to a Depression.

Charley's picture

If you chart GDP, using the price of gold instead of dollars, you will find this depression began around 2000-2001. This explains the entire fiat monetary policy of the Fed, and, why Cheney remarked, "Deficits don't matter."

 

Only gold discloses this secret...

 

Here: http://tinypic.com/r/2dhs8sx/6

 

Charley's picture

Let's put this another way:

Deflation: European austerity, US states' austerity, China relaxation of its peg (again, austerity)...

Deflation offset: No house budget resolution = the victory of Modern Monetary Theory, i.e., damn the deficit full dollar explosion ahead. We don't have to borrow your stinking dollars because we own them already.

Result: the death of all alternative currencies to the dollar, gold price collapse.

Charley's picture

BTW: this will be the third US default in 80 years. (The domestic gold standard in 1933, Bretton Woods in 1971, and ?2010-2011?)

Max Gibson's picture

finally! I almost started to worry about my shorts

Kreditanstalt's picture

My thoughts exactly! 

Initially, I was about to scream, a la "V for Vendetta", WHY WON'T YOU DIE??? at CRE.

But now I may get a little help...still, it's "Up and down, up and down, up and down WE GO!!!!", just like the Teletubbies

papaswamp's picture

Hurricane biotches!!!

1. A LOW PRESSURE AREA CENTERED BETWEEN THE NORTHEAST COAST OF HONDURAS
AND GRAND CAYMAN CONTINUES TO SHOW SIGNS OF ORGANIZATION. SHOWER
ACTIVITY HAS BECOME A LITTLE MORE CONCENTRATED THIS MORNING...AND
SURFACE PRESSURES ARE FALLING. UPPER-LEVEL WINDS ARE GRADUALLY
BECOMING MORE CONDUCIVE FOR DEVELOPMENT...AND THE SYSTEM IS LIKELY
TO BECOME A TROPICAL DEPRESSION BEFORE IT REACHES THE YUCATAN
PENINSULA IN A COUPLE OF DAYS. THERE IS A HIGH CHANCE...70
PERCENT...OF THIS SYSTEM BECOMING A TROPICAL CYCLONE DURING THE
NEXT 48 HOURS.  AN AIR FORCE RECONNAISSANCE PLANE IS SCHEDULED TO
INVESTIGATE THIS DISTURBANCE LATER TODAY TO DETERMINE IF A TROPICAL
CYCLONE HAS FORMED.

Gully Foyle's picture

Phil Collins - I Dont Care Anymore

http://www.youtube.com/watch?v=xLpfbcXTeo8

I Don't Care Anymore lyrics

Well
you can tell everyone I'm a down disgrace

Drag my name all over the place - I don't care anymore.
You can tell everybody 'bout the state I'm in

You won't catch me crying 'cos I just can't win -
I don't care anymore
I don't care anymore

I don't care what you say
I don't play the same games you play.
'cos I've been talking to the people that you call all your friends
And it seems to me there's a means to an end - they don't care anymore.
And as for me I can sit here and bide my time

I got nothing to lose if I speak my mind -
I don't care anymore
I don't care no more

I don't care what you say - we never played by the same rules anyway.
I won't be there anymore
get out of my way - let me by

I got better things to do with my time

I don't care anymore
I don't care anymore

I don't care anymore
I don't care anymore.

Well
I don't care now what you say
'cos everyday I'm feeling fine with myself.
And I don't care now what you say
hey -
I'll do alright by myself 'cos I know.

'cos I remember all the times I tried so hard
And you laughed in my face 'cos you held all the cards -
I don't care anymore.
And I really ain't bothered what you think of me
'cos all I want of you is just a let me be -
I don't care anymore
d'you hear I don't care no more

I don't care what you say - I never did believe you much anyway
I won't be there no more
so get out of my way - let me by

I got better things to do with my time
I don't care anymore.
D'you hear I don't care anymore
I don't care no more.
You listening I don't care no more
no more.
You know I don't care anymore
don't care no more
no more
. . .

Citizen of an IKEA World's picture

Father: That's rockin' good stuff!

Son: "Fuck you, dad!"

--Patton Oswalt

yabs's picture

papaswamp

I'm sure Jpmorgan will say a nice bit of oil rain in the south is good for the economy

I mean not only will we have to clean up ouil from the sea but now we can have clean up on the land as well

Think of all those crops dying as well

they will have to replanted and heh maybe a few million of people will have to relocate

maybe boosting up rents further north

all in all a real WINNER for the economy

oklaboy's picture

yee of little faith, Obamo will lower the oceans and part the sea's, quel your disbelief, all wil be well under Comrade Obammooooooooo

dan22's picture

 


China’s Coming Banking Crisis- The Banks Are Loosing Deposits At a Rapid Pace

"Lower Interest Rates Can No Longer Attract Deposits, Major Banks Are Luring Customers With Higher Interest Rates."

By the end of March, Citi bank, Ever bright bank, Merchant Bank, Pudong Development banks, Industrial Bank, and Minshen Bank of china’s loan deposit ratio is exceeding the official upper limit(75%) set by CBOC and China Banking Regulatory Committee. Among them, Mingshen and industriral bank are exceeding 80%, while local city commercial banks are at even worse of a shape. So, the deposits in Chinese banks are shrinking and they are facing rising liquidity risk while there is a capital out flow of wealthy Chinese

 

Cursive's picture

The Depression is an open secret.

papaswamp's picture

In depth explanation by ECRI of what is coming....duck and cover!

 

http://www.businesscycle.com/reuters/news/2010/june/pdf/3radb25mavjw1pk.pdf

Mitchman's picture

Her comes QE2 to infinity and beyond!

Monday1929's picture

I have trouble with the captcha, but that's 3.1 % points, no?

The S&P Crash will be 90% down though.

LS

DosZap's picture

Well, the asshol*s just passed anothe (2000 PAGE FINANCE REFORM BILL!!!), as usual no one knows what is in it.except a few leaks............

Any LOAN you want to take will be subject to a Fed regulator, and maybe even denied.

Nothing to do with your credit scores.

 

bmfe's picture

I can substantiate this article.  I work for a large semiconductor company that makes low end parts that go into EVERYTHING.  We have evenly distributed geographical sales all over the globe, across many industry segments, and into tens of thousands of diverse products.  All and all, our shipments have been an excellent leading indicator /  economic bellwether.

 

 I keep a personal tracker at my desk of all orders we make over $500k on a daily basis.   Huge precipitous drop back at the end of ’08 with sustained malaise though most of ’09.  Then around Jan 2010 things went gang busters, record after record. Trouncing all ’08 pre-bust benchmarks.  Then suddenly, in the last 5 weeks shit fell off.  Not dead mind you, just flaccid.  So this ECRI drop is no surprise and is within the scale of what we’re seeing.

Muir's picture

Thank you for your post.

firstdivision's picture

Thank you for the direct impact perspective

Kali's picture

Thank you, good info.  My biz is showing the same trend.

Bohica's picture

For a little perspective here, the WLI itself is up from last week, at 122.9 up from 122.5