Thursday, January 21, 2010

Dec. Leading Economic Index Hits Record High; First Time Since 2004 of 9 Consecutive Increases

WASHINGTON, Jan 21 (Reuters) - "A gauge of the U.S. economy's prospects rose for the ninth straight month to a record high in December, a private research group said on Thursday, indicating a recovery was set to pick up. The Conference Board said its index of leading economic indicators rose 1.1 percent to an all-time high of 106.4 last month.

Analysts forecast that the index would rise 0.7 percent, according to a poll by Reuters. "The leading economic index suggests that the pace of improvement could pick up this spring," said Ken Goldstein, an economist at the Conference Board."

MP: The Leading Index's ninth monthly increase from April to December 2009 is the first time since mid-2004 that the Leading Index has increased that many months in a row.

9 Comments:

At 1/21/2010 1:51 PM, Anonymous Anonymous said...

I'd rather live in the leading economic indicator economy than the real one.

I wonder how the chart would look if you overlayed it with the actual economy, with a lag.

 
At 1/21/2010 1:52 PM, Anonymous Anonymous said...

Looks like the Reagan years were a bummer in terms of leading economic indicators.

 
At 1/21/2010 3:03 PM, Anonymous gettingrational said...

The Federal Reserve has a good web page that explains and defines:Leading, Coincident and Lagging Indicators.

Thus, we look for upward graphs for Leading and Coincidents (duh) but downward for Lagging (new to me) -- in case anybody else was wondering!.

 
At 1/21/2010 4:35 PM, Blogger OBloodyHell said...

> I'd rather live in the leading economic indicator economy than the real one.

I have to go with anon on this one.

There seems to be a disjoin between Indicator-Universe and The-One-We-Inhabit.

> Looks like the Reagan years were a bummer in terms of leading economic indicators.

Only the first part of the first term, and year 3, both of which were corrections to what had been messed up in the 70s.

The difference was, you could FEEL that the issues were resolving, something that isn't happening now.

It's not that Obama's gotten handed problems -- it's that he isn't showing that he has any clue how to actually fix them. The "solutions" he's applying don't work, more critically are known to not work, and hence aren't going to work.

In addition, he's pushing for things that are known to make things worse.

It's obvious he suffers from Cranio-Rectal Insertion Syndrome.

And no, I'm not going to quip that maybe he's not really black, that it's just an obvious side-effect of his CRIS.

Okay, okay, I just did. Couldn't resist...


.

 
At 1/21/2010 7:05 PM, Anonymous Anonymous said...

Dead cat bounce, if you ask me. But you didn't.

 
At 1/21/2010 8:24 PM, Blogger Craig said...

I hope these bear out, but we have to remember that economics is, in the end, the study of human expectations and how those are expressed in economic transactions.

I still fear that -- absent a very clear signal from Washington that health insurance costs won't go up; that carbon emissions won't be controlled and that capital gains taxes won't be hiked -- there will be no significant recovery.

I've no reason to doubt the accuracy of the leading indicators, but a recovery is not required simply because they're heading in the right direction. Business is still not investing in its own future.

Growth can't happen without that.

 
At 1/21/2010 10:51 PM, Blogger BxCapricorn said...

I read a lot of comments, and I though Craig was dead on.

I love your blog professor, because you post so much information and great graphics, but since you have no unified knowledge of trading, you fall for the same trader-engineered setups over and over again.

The BDI, leading indicators, data (that is revised to the downside months later)...the list goes on and on.

If I believed what you focus on, I would not have avoided the financial retirement savings meltdown, be filing with lawyers for "bankruptcy protection", having my vehicle repossessed, fighting with my spouse over money expectations, etc.

Instead, I go to work, live a normal life, have realistic retirement expectations (that include my original spouse) and marvel at the greed and fear that drives people. Economics is the study and manipulation of the audience which watches the daily comic/tragedy of money, hoping to gain more of what they don't really need, and willing to lose it all in the process. If you can't take it with you, and the kids wouldn't appreciate it, why care?

 
At 1/22/2010 7:31 AM, Blogger juandos said...

"I still fear that -- absent a very clear signal from Washington that health insurance costs won't go up; that carbon emissions won't be controlled and that capital gains taxes won't be hiked -- there will be no significant recovery"...

Yep!

Very well said Craig...

I keep wondering what private sector will Obamunism flounder into next...

 
At 1/22/2010 7:35 AM, Anonymous geoih said...

And yet the economy is still in the toilet. I think when your metrics say things are going well, but the reality is much different, then maybe you're not measuring the right things.

 

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