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Source: Street Talk Live



Whenever we are near fully invested, we begin to look for the drivers that have the potential to derail the current portfolio posture.

Earnings were the prime worry last month. Now, the concern is an eventual recession coming sooner rather than later.

Towards that concern, Albert Edwards of Soc Gen points us to John Hussman who points us to Lance Roberts, who is looking at the Coincident to Lagging Economic Indicators (above) . Dennis Gartman has called this the “single best recession forecaster” there is.

While I don’t believe that a recession is a sure thing, I also suspect (fear?) that it is a greater possibility than most Non-Rosenberg economists are forecasting.

That is the nature of the art of investing – it requires probabalistic decision-making using imperfect information about an inherently unknowable future.

Category: Data Analysis, Economy

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

7 Responses to “Coincident to Lagging Economic Indicator”

  1. alexanderdelarge says:

    BR, maybe you’ve said this before, in the past…. but this…. ” That is the nature of the art of investing – it requires probabalistic decision-making using imperfect information about an inherently unknowable future. “…might be the single best sentence / thought / acknowledgement, etc. Period. Thanks.

  2. Knownuthing says:

    Nothing is a sure thing, but of course a recession has a much higher probability that is commonly acknowledged.
    For a start we still have to meet a recession that was predicted by the majority of economists and analysts. They are always caught by surprise and chances are they will be this time.
    In they specialize in this, and surprisingly they present a chart dated 10/31/2012 in which they follow the same indicators that NBER does. Surprisingly a month an a half ago we were at a level that was only seen twice since 1959 and the economy was not coming or going into recession yet they give a recession probability of 12.8% (yes, with decimals). To me it would be a chance of 1-(2/10) = 80% That’s my probability of a recession in the cards.

  3. AHodge says:

    worth a little not that much
    leading indicators better
    i think you read it as turning points and direction

    who put in the recession indicator line?
    if you literally looked at that only
    look at the history it stinks?

  4. Mike C says:

    Dr. Jeff Miller took this indicator on in his Nov 7 posting:

    I read that piece…he writes some good stuff, but he is a permabull who completely missed the 2008 recession and bear market. Whenever the next recession hits, he won’t see it coming.

  5. Nice chart except that it missed the 1990 & 2001 Recessions. TRI gauges Q4 is on a 1.2% GDP pace. 2013Q2 still looks awesome…

    TRI chart:

  6. innertrader says:

    The problem we are currently experiencing in “predicting” is called Socialism or Marxism. Within the “two” nothing is “real” and the so called “numbers” or “reports” can no longer be relied on, period. WE, as in “American Citizens” are in HUGE trouble! WHY do you think they supposedly have violated the Constitution and can now arrest anyone at anytime, without charges and hold you for as long as they wish…. they can throw away the key, should they so desire. NOW, we no longer dare to speak up for the “Rights” we once had. We have LOST them for our children and grandchildren. I am ashamed.