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Economists Name Least Useful Indicator

Posted By Barry Ritholtz On September 26, 2005 @ 5:42 am In Economy | Comments Disabled

A Chicago Tribune [1] article on Sunday named the most useful and useless economic indicators. A panel of 15 economists/analysts (including yours truly) participated in the discussion.

There were many indicators deemed helpful, with very little overlap. As the old expression goes, "that’s what makes a horse race." The big surprise was the widespread agreement, by a large margin, of which indicator was of the least value.

The envelope please . . . (I’m so excited) . . . And the winner of the economic report deemed most worthless is:

The Conference Board’s Leading Economic Indicators [2]

No upsets here, the favorite took the prize! Kudos to the conf bd for producing the LEIs [2] — now widely acknowledged as the most useless economic indicator in the land! 

Via the Chicago Tribune [1], here’s our Ubiq-cerpt:™

"We asked 15 economic analysts to tell us which indicators are most–and
least–valuable to everyday investors. One thing they do agree on: Data
are dandy, but trends are tops…

Our experts also named a few names on a handful of economic reports that are worth overlooking.

Leading the list of pans was the leading economic indicators, a monthly index published by The Conference Board that compiles 10 other economic reports, including jobless claims, interest-rate spreads, stock prices and building permits. (emphasis added)

Let me be the first to offer my hearty congratulations to the Conference Board [3] for all their efforts. Thanks to your insightful work, you managed to take something with actual utility for investors, and turn it into a worthless, widely-ridiculed, piece of economic flotsam. Nicely done.

Congrats on all your fine work . . . [3] 

Experts gauge the gauges [1]
Janet Kidd Stewart
Chicago Tribune, September 25, 2005 (Your Money columnist)

Follow Indicators? Look For Momentum [4] 

Ha Ha [3]
Nelson Munz: Economic Analysis & Commentary

Article printed from The Big Picture: http://www.ritholtz.com/blog

URL to article: http://www.ritholtz.com/blog/2005/09/economists-name-least-useful-indicator/

URLs in this post:

[1] Chicago Tribune: http://www.chicagotribune.com/business/chi-0509250321sep25,1,7931852.story

[2] The Conference Board’s Leading Economic Indicators: http://www.conference-board.org/economics/bci/

[3] Conference Board: http://bigpicture.typepad.com/comments/files/haha.wav

[4] Follow Indicators? Look For Momentum: http://www.courant.com/business/hc-ymindicators0925.artsep25,0,7259824.story?coll=hc-headlines-business

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