What both of these organizations need to do — pronto! – is change their models for calculating data.
Yesterday’s existing home sales, and today’s Durable Goods numbers both were awful. But the problem isn’t with the economy — its the econometric models used to calculate these data points.
In case you forgot, the Conference Board decided they didn’t want the LEI’s to be negative — which has been the case for 10 of the past 12 releases. So they "form-fitted" some of the indicators that make up the LEIs. By drawing the highly suspicious conclusion that even a flattening yield curve shows up as economically positive, they were able to stay upbneat about the future, despite the ominious readings of their own indicators.
Even people recently suffering from recent blunt head trauma (and concurrent brain damage) know a flattening yield curve is nit stimulative — indeed, its a big negative — but it was the only way to get a decaying economic situation to appear positive.
ISM and NAR may want to steal that approach. Otherwise, their data may remain useful to those reality-based people who still care about such things . . .
Music industry insider Bob Lefsetz gives us brief history of the Music Business, and a fascinating vision of what the future of the industry might look like:
"What if it’s over. What if everything this business was built upon, everything we know, is disappearing.
Well, this business WAS built upon music. But that was a long time ago.
That was before everybody got greedy. Before it was demonstrated how much MONEY there was in the music business.
Oh, there’s always been a music business. Back to the days when cavemen were banging on rocks and people sat around and listened. But the sixties were different. We had recorded music, and a large ready audience, i.e. baby boomers, with the money and wherewithal to buy it.
Before the sixties the single was the dominant format. First 78s, then 45s. You can’t make much money selling singles. Just ask the labels how profitable iTunes is. And, there wasn’t much money. There was a depression. And then a war. But when rock and roll hit, when the baby boomers came of age, when the Beatles turned it into an album format, purveyors started COINING DOUGH!
You HAD to have the Beatle album.
And the Beatles and the San Francisco sound begat concert venues. And press to cover the scene. And suddenly, music was the driver, the hippest art form extant.
And the MONEY!
First there were the records. Then, Led Zeppelin changed the live deal. To 90/10. And everybody wanted to SEE Led Zeppelin. There was no venue too big, they could sell every seat of a stadium.