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The 'Other' Recession Indicator Is Flashing Red
Having disproven the "yield curve is not inverted so there cannot be a recession anytime soon" meme, we thought the following chart of a much more macro-economic-data-related indicator that appears to be a useful timing tool for suggesting recessionary conditions exist would provide some more useful context than an articially-manipulated 'market' interest rate.
As Evergreen Gavekal notes, the ratio of coincident-to-lagging conference board indices has an admirable record as a recession forecaster... and is at its lowest level since Sept 2009.
h/t @EvergreenGK
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Heck of a recovery Brownie.
<Call it whatever you want. Just don't call it a depression.>
And what a recovery it is!
maniacal laughter
Good chart. Captures perfectly the fact we never left the last recession.
That we can call this obvious depression a "recovery" is testament to how far thought control and lying has come since 1933.
1984 was written in 1948.
You mean it wasn't all the other stuff:
Repost:
Largely I missed out on the Financial Cycle in trying to put together a timeline of some sort. Can't really trace when European Bankers came to the USA either, maybe after 1812. Or maybe in 1791, the government granted the First Bank of the United States a charter to operate as the U.S. central bank until 1811.[138]
- 1900s, when US started Depending on Outsourced Produce
- 1900s, when US started using military to suppress union movements, strikes, and management problems in foreign countries producing agricultural goods, first signs of Empire
- 1960, when US started Outsourcing Auto Factories
- 1968, when Costs of Vietnam War became Obvious Problem
- 1971, Nixon Shock, US Refuses to convert USD to Gold for Foreign Holders of USD
- 1972, BCCI Bank created
- 1974, CIA Slapped with Investigations of Practices, they decide to Outsource & Subcontract
- 1978, Soviet-Afghanistan War Starts
- 1979, the Top of US Manufacturing
- 1979, when US Median Wages got Stuck or leveled out
- 1980, Presidential Campaign, Debt, Economy, Inflation, Iran
- 1981, the Top of US Money Velocity
- 1982, Ronald Reagan Maxes out DoD Budget
- 1982, CIA Begins using BCCI Bank
- 1986, DoD Contractors Soar with profits & plans
- 1990, Start of US Gulf War with Iraq, US & UK will Bomb Iraq for the next 13 years till US-Iraq War II
- 1994, NAFTA Treaty,
- 1995, Sub-prime mortgages started
- 1995, Community Reinvestment Act, the Clinton Admin urged flexibility,
- 1995, HUD advocated greater involvement of state and local organizations
- 1996, Start of a Period of Accounting Fraud in USA which continues today
- 1997, M2 Money Velocity Top
- 1998, Brooksly Born Rejected on her concerns on OTC Derivatives
- 1998, Derivatives expanded and were not regulated
- 1998, Clinton's Kosovo War
- 1998, Citicorp & Travelers Insurance Merger
- 1999, Gramm–Leach–Bliley Act (GLBA), End of Glass Steagal Act
- 2001, US-Afghan War
- 2003, US-Iraq War
- 2005, CAFTA-DR Related Progression
- 2005, US Mortgage Top of Bubble
- 2008, US-Global Financial Crisis
- 2012, Existing Home Sales finally return to USA
- 2013, IRS Budget exceeds $100 Billion since it now pays out cash to households as Credits
- 2013, Corporate Income Taxes Receipts still fail to return to 2006, 2007, or 2008 pre-crash Level of over $300 Billion
The power of Monopoly is very strong and corrupting.
Rules will be broken, Crimes Committed, Fraud Created... Lobbing will under cut the laws of the land and the rules of Commerce. It is best to recognize that humans will always petition for changes while committing fraud and larceny.
Why don't the people get it. Why don't voters get it when only 10% of the Population is making economic gains.
Good Paying Jobs were based on Manufacturing... even if it became corrupted with compensation that was too high... and Let's Get Real about the Fake US Auto Industry that paid everyone too much compensation... lowered quality... and lost the entire US Auto Industry to Foreign Competition!!
Zero Net US Investment in Manufacturing is the result of Monopoly & too much Industry Control.
Zero Net US GDP Growth since 1989 is the result of Monopoly, Centralized control of Credit & Investment, and to much Central Planning... like Communism or Fascism or Catholicism... Truth Hurts.
From an old post:
1913 federal reserve act, 16th amendment
1933 eo 6102
1934 gold reserve act
1935 ssa
1938 fnma
1942 ration books
1944 bretton woods
1948 gatt
1963 eo 11110
1964 affirmative action
1965 medicaid
1966 medicare
1971 nixon shock
1977 community reinvestment act
1980 china provisional most favoured nation status
1980 fed fund rate 20%
1986 tax reform act (beginning of s&l crisis)
1995 wto
1996 reed amendment (shame and name)
1997 asian contagion
1998 ltcm bust
2001 china permanent most favoured nation status
2001 tech wreck,
2003 medicare act of 2003
2004 fed fund rate 1%
2008 expatriation tax
2008 financial crisis
2008 QE1
2008 fed fund rate 0.25%
2010 obamacare
2010 estate tax repealed
2010 fatca
2010 QE 2
2011 estate tax reinstated
2012 QE 3
Poisson process, major rule changes every 3 years
I thought the 'meme' was an inverted yield curve is always followed by a recession. NOT a recession is always preceded by an inverted yield curve...
very good.
Georgie Orwell, a former Fabian, wrote 1984 as a warning of the Fabian plan for the world. 1984 was the Fabian Societie's centennial. Keynes was a Fabian, as well. Orwell was introduced to them through his French teacher at Exeter, Aldous Huxley.
FORWARD FABIANS!
The market is running on hope and forecasts of profits to come. Christmas will be interesting this year and the fire sale afterward should be spectacular.
Or the fires after the sale will be spectacular.
Which one, the dot com bubble or the subprime 2008? scary chart indeed!
The "recovery" is measured in a ever-smaller meter stick known as the US dollar.
On dating sites, I'm going to become 6'0 and then 6'1" using Barry and Bernanke Math.
Duck(y) and recover(y)...
They'll keep changing the definition of "recession" so we're never in one.
NEW: Obama official calls Netanyahu "chickenshit", sparks fly
http://tinyurl.com/luntrox
Dear Abbey,
Used to be an old saying the pot calling the kettle black.
So, I'm wondering how it's rephrased for the _______ calling _______ chickenshit?
Signed
Perplexed
my best friend's sister makes $80 /hour on the internet . She has been laid off for 7 months but last month her paycheck was $13987 just working on the internet for a few hours. visit site... www.Yelptrade.com
What recession? The stock market is near all-time highs, unemployment rate is below 6%,
and President Obola states that we are in recovery. There must be a glitch with that indicator.
When the central banks lose control that will be the lynch pin. We are getting closer every year.
Just like congress has lost it so will the CB's.
The CB's can buy all the futures and stocks they want. But they can't force people to buy them except for the shorts. When the shorts are gone that'll be the end game.
The what? The the ratio of coincident-to-lagging conference board indices. OK, I understand now (NOT).
Sure you do
The Conference Board (As separate from Congress or the Bilderbergers and has nothing to do with the meetings Flounder has missed) has 3 indicies; Leading, Coincident and Lagging.
This ratio is simply the Coincident divided by the Lagging.
You do'need ta unnersands no more.
Actually, the point is that Coincident indicators will show a firming or weakening in the level of economic activity before Lagging indicators. Thus, when the ratio falls, it portends weakness and vice versa.
So when the trend is prolonged in falling, then it foreshadows a much weaker (increasingly weakening) economy. And vice versa.
What about the Leading index, you ask? The leaders are generally held to be the weakest predicatively of the three, so the ratio of the stronger two is considered a more robust forecasting mechanism.
:)
What are you? Some kind of freaking economist or something? Nobody's supposed to understand shit like that. Get the hell outta here. Stop explaining things in simple terms that were designed to sound too complicated to understand.
All kidding aside, that was really freaking good.
What are we talkin' here, lagging indicators:
Like:
- Existing home sales
- Flat or Decreasing real Median US Wages since 1979
- Loss of Manufacturing Jobs, an exponential Rate since 1979
- Lower Labor Participation Rate since women entered the Work Force in 1960s
- Higher Wealth Disparity and Discontinuation of GINI Coefficient chart by the Federal Reserve
- Higher Government Compensation, higher public & private executive compensation continuously since 1979
- Federal Contract Exponential Expansion in number and total dollars since 1982
- Halting of Fixed Income Wealth Growth since 2008
- Halting of Pension Fund Growth, percent Investment fulfilled by corporations since 2008
- Total Decrease in use of Retirements for security since 1980s
- Exponential Growth of Wealth of DoD Contractors since 1990
- Matching Growth of Federal Budget to Corporate Wealth & Subsidies since 1986
- Matching Growth of US TBTF Banking Profits since 1998
I'm certain that chart is upside down. Nothing to see here...Please disperse.
Signed,
Obama Administration Chart Czar
Operation Twist 2.0 coming soon.
My FAFSA indicator is flashing red too; ever since the IRS grabbed a chunk of it to, of all things, pay taxes that I don't owe. Arrest Loyd Blankfein.
Again this morning I awoke to a market where stock futures were soaring ever higher even after important economic numbers had been released that came in below expectations. As the stock market continues to remain at historic highs please tell me what is so good? What is so much better? As I see it the weight of carrying a large number of unemployed and nonworking people who have dropped out of the work force will wear down society through attrition.
The article below points out some of the glaring flaws in the argument that blue sky lies ahead. The article below points out some of the glaring flaws in the argument that blue sky lies ahead as the stock market seems to indicate. As I look at a landscape of empty and under-leased buildings that once housed thriving businesses that provided Americans with good paying jobs I'm forced to ask, How are things getting better?
http://brucewilds.blogspot.com/2014/10/tell-me-again-how-things-are-getting.html
I'm not sure at this point anyone gives a flying fuck about quality of living, employment, purchasing power. They are drunk on greed and an ever increasing stock market. It's human nature, end of story. It's a feeding frenzy now to the point of destruction.
How it ends will become the important issue.
70% of the country is angry about the direction of the country.
Let's see how angry the dumbasses are. If they are really angry they will vote out some of the incumbents.
To set the stage for the next election I think it should be mandatory that both Obama and George W are the Democrat and Repulican representatives.
If this was the case, who the hell are the US citizens going to vote for? This should frame the context of democracy in the US.
I garantee you that the next Republican president will be even worse than Obama and the next Democrat president after that will be worse again.
It'd be hard for the best of intentioned persons now to turn around the USS Titanic, she's steaming on all engines in overdrive towards the iceberg and when those rock hard shards of ice start ripping through the hull get as far away from the country as you can. The tribe will be the first on the life boats and pulling away with them half empty, count on it.
come on now for the twentieth time it is not a country but a corporaton! so start acting like an employee and not some dumb citizen!
I don't think what the fed does will have much long term impact.
If they don't support the market the market will fail and we are doomed.
If they do support the market then the rest of the world will see that our economy is really just the fed printing mo money. They will stop accepting dollars even faster than they currently plan to...then the market will fail and we are doomed.
Either way our fate is no longer under our control. We live (a bit longer) or die depending upon the kindness of strangers (most of whom we have really pissed off over the past 6 decades).
"If they do support the market then the rest of the world will see that our economy is really just the fed printing mo money. They will stop accepting dollars even faster than they currently plan to...then the market will fail and we are doomed."
Except that rest of the world is also doing QE or some type of financial shenanigans too. In the case of Europe People are worried about Bank Bail-ins, so they move their money to the US in hope of avoiding Bail-ins. In the Asia, The have a Debt bubble that dwarfs the US, and Japan has even bigger QE program. For the time being, the US Dollar is the prettest of a group of very ugly women.
Its likely this slooow-Mo collapse will continue for quite some time. Unless there is some sort of event that breachs the tipping Point. I don't expect the announce of QE (probably in Q1 or Q2 2015) to be that event. If Ebola spreads to other parts of the developing world (ie India, China, Latin America) it would certainly take eyes off the US for a while. One or two Ebola victims in India or China could trigger a big pandemic there since there are very large overpopulated regions, and the majority of the people in India and China would have issues protecting themselves from infection (lack of hygene and overcrowded public transportation systems).
Overpopulation is THE single most pressing issue facing humanity. Nearly every problem has it's roots in over population. The problem is, who decides what the right number is. My answer: mother nature. It's just that the process of equalization is going to be truly horrible. We humans are a glutten for punishment. I'm beginning to think we actually like it that way.
Does this mean it is time for Wall Street and the FED to rake the little people's chips off the green felt again?
Screw them with lost valuations, lost jobs, and taxes paid on having to cash out their 401K's/IRA's?
Lather, rinse, repeat?
2000...2008...