Friday, December 18, 2009

Another V-Sign of Economic Recovery: Philadelphia Fed Index Highest Since Apr. 2004, 4 1/2 Year High

PHILADELPHIA FED -- Activity in the region's manufacturing sector is expanding, according to firms polled for this month's Business Outlook Survey. Indexes for general activity, new orders, and shipments all remained positive this month. Indicative of improvement, the overall level of employment and average work hours among reporting firms increased this month. Overall, expectations moderated somewhat in December, although the forecast for employment improved slightly.

The survey's broadest measure of manufacturing conditions, the diffusion index of current activity, increased from 16.7 in November to 20.4 this month. The index has now remained positive for five consecutive months (see chart above, click to enlarge, data here).


MP: The 61.7 point improvement in the Philadelphia Fed Current Activity Index from -41.3 in February to +20.4 in December follows a pattern very similar to the last two recessions (see red circles in graph) and provides an additional V-sign indicator that we are now in a period of unmistakable economic expansion (see more here).

2 Comments:

At 12/18/2009 1:34 PM, Anonymous Benny "Tell It LIke It Is Man" Cole said...

Die recession, die, die, die!

I think we got this recession under the water, and the bubbles are coming to the surface. A few more shivers, and we can call it dead. Oh, happy day.
Blah, blah, blah double-dip--based on what evidence?

We may see a new paradigm--investors wait for busts, then rush in. With a chronic glut of global capital, we are going to see booms and busts a lot. In time, intrepid investors will toughen up, moving in quickly to buy when the weaker-nerved bail.

Right now, who doesn't wish they went all-in in the dark last quarter of the Bush Administration?

My advice: We are on the cusp of the greatest boom in global GDP of all time. It will last for decades.

You can be a weenie, and stay on the sidelines, wringing your hands.

Or, you can buy when markets tumble, and get really filthy rich in the next 20 years.

I never met a wealthy pessimist. and I am not talking just about money, although next to money everything else is secondary of course.

It is true, the USA will lag non-Islamic Asia going forward. The future is there. We are burdened by debt spending, for social welfare, a military-parasite complex, and a huge rural subsidy economy. But, even here there will be economic growth.

But non-Islamic Asia? I think we see 5 percent a year GDP growth for decades at a stretch. Wow.

 
At 12/18/2009 6:05 PM, Blogger bob wright said...

Benny,

The "military-parasite complex" is the only reason you're not speaking German or Japanese right now. It is also one of the few legitimate functions the federal government has. We can disagree on weapons systems and force size/structure; but they are at least constitutional.

I'm with you on axing the departments of agriculture, energy, education, HUD, commerce, etc. These are usurpations of state power by the federal government.

Merry Christmas to you and your family :)

 

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