Thursday, September 23, 2010

Leading Index Improving, But Very Slowly

The Conference Board reported today that the U.S. Leading Economic Index reached a new high of 110.2 in August, and increased for the 15th time in the last 17-month period that started in April 2009 just before the recession ended.  Today's announcement follows recent reports from the Conference Board that its July Leading Indexes increased in Germany, France, Spain, China, and the U.K.; and fell in Korea and Japan in July.  

Ken Goldstein, economist at The Conference Board, said: “While the recession officially ended in June 2009, the recent pace of growth has been disappointingly slow, fueling concern that the economic recovery could fade and the U.S. could slide back into recession. However, latest data from the U.S. LEI suggest little change in economic conditions over the next few months. Expect more of the same – a weak economy with little forward momentum through 2010 and early 2011.”

MP: Looking at the chart above, there were several periods in mid-2002 and early 2003 when the economy was in recovery from the 2001 recession, but the LEI was flat for several months in a row, similar to the flattening in recent months.  

4 Comments:

At 9/23/2010 2:21 PM, Blogger juandos said...

How does continued high unemployment play into the LEI?

 
At 9/23/2010 5:52 PM, Blogger PeakTrader said...

Warren Buffett: "We're still in a recession"
Sep 23, 2010

Buffett said he defines a recession differently from the NBER, saying it ends when real per capita gross domestic product returns to its pre-downturn level.

 
At 9/23/2010 6:54 PM, Blogger PeakTrader said...

U.S. Real Per Capita GDP (in 2005 dollars) peaked in 2007:

2007 $43,926.00
2008 $43,713.92
2009 $42,247.00

http://measuringworth.com/usgdp/

 
At 9/23/2010 7:11 PM, Blogger PeakTrader said...

Based on real per capita GDP data, the U.S. fully recovered from the 1990-91 recession in 1992 and there wasn't a recession using annual data in 2001.

Also, the U.S. fully recovered from the 1973-75 recession in 1976 and from the 1981-82 recession in 1983.

 

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