ECRI’s Weekly Leading Index: No Business Cycle Upturn in Sight


Chart courtesy of ECRI

As the chart above reveals, ECRI’s leading indicators are deep into recession territory. Not only are they weekly measures at the lowest levels in 5 years, but the annualized drop is the biggest in 28 years.


"The Economic Cycle Research Institute, a New York-based independent forecasting group, said its Weekly Leading Index fell to 125.9 in the week to Aug. 15 from 126.4 in the previous period. Its annualized growth fell to negative 11.4 percent from minus 10.7 percent, revised up from minus 10.8 percent. It hit its lowest mark since the week to June 13, 1980, when it was negative 11.8 percent.

The index declined to its lowest since July 2003 due to lower stock prices and housing activity, and the fall was partly offset by lower interest rates and jobless claims, said in an instant message interview Lakshman Achuthan, managing director at ECRI.

"Last year WLI growth fell to its worst reading since the 2001 recession, and today it has plunged to a 28-year low, its worst reading since the 1980 recession," he wrote. "This makes it crystal clear that there is no business cycle upturn in sight."

It is getting increasingly difficult for event he most polyannish permabull to claim — at least within a straight face — that there is no US recession.


Weekly Leading Index (WLI) Press Release
Friday, August 22, 2008

US yearly growth gauge drop biggest in 28 yrs-ECRI
Rodrigo Campos
Reuters, Aug 22, 2008 10:31am

Category: Data Analysis, Economy, Psychology

ECRI’s Weekly Leading Index: No Business Cycle Upturn in Sight

Category: Data Analysis, Economy, Psychology

CNBC: Shadow Fed/Economists Fishing Trip

Squawk Box will run a 4 part series on Grand Lake Stream trip this week. 4 Packages which Steve Liesman will wrap around, beginning at 7:15am, and then repeating throughout the week.  (I believe the full package will run sometime on Labor Day weekend)

The 1st installment of the Kansas City Shadow Fed/Maine Leen’s Lodge fishing trip will air Tuesday at about 7:15 am EST.

I had a long sit down with Steve  for part 2 and 3 — unshaven, unshowered, reeking of fish –  be happy its not broadcast in smell-o-vision.

It will be interesting to see what gets cut and what stays in  but you never know what ends up on the cutting room floor.

Tuesday – Friday

Part1: The forecast/results of the survey and an overall review of the trip

Part 2: fishing for answers to the credit crisis Part 1

Part 3: fishing for answers to the credit crisis Part 2

Part 4: The future of the banking system

Category: Media, Video

Feldstein: Low Rates May Not Boost U.S. Growth

Harvard University economist Martin Feldstein, a member of the committee that charts American business cycles, said the Federal Reserve cannot count on low interest rates to buoy economic growth.

"Lower interest rates are not going to get us anything more,” Feldstein, who retired in June as president of the National Bureau of Economic Research. The economy has really shown one sign after another of weakening.”

click for video

(why this sometimes works with on a Mac and sometimes not is beyond me)


Feldstein Says Low Rates May Not Boost U.S. Growth
Anthony Massucci and Kathleen Hays
Bloomberg, Aug. 21 2008

Category: Economy, Fixed Income/Interest Rates, Video

Take A Load Off Fannie

Interesting juxtaposition!

Hat tip:  A.Deluca

Category: Credit, Real Estate, Video

Bank Robbery

Category: Credit

Political Futures Markets on CNBC

How funny is this?

Cashing in on the Race:  The Intrade political futures market shows shares of Barack Obama has gone up nearly four points, with CNBC’s Scott Cohn   


click for video

One correction to the video: Intrade did actually have Biden as the top Veep pick

Category: Markets, Politics, Video

Market Selloff Due to Presidential Polls ?

Category: Markets, Politics

Existing-home sales drop 13.2% as prices fall 7.1%

Category: Real Estate

Money Markets Show Credit Crunch is Worsening

Category: Credit, Derivatives, Economy