A “leading indicator” is supposed to forecast, or at least to help the person using it, to make a forecast. The Conference Board recently announced that it was changing its Leading Economic Indicator to address structural changes that have occurred in the US economy in the last few decades. The new indicator was released on [...]
Business writers often speak of “measures that drive future performance.” The trick is figuring out what measures those are. Doctors have been measuring their patients since the Italian doctor Santorio Santorio invented a scale for the Galileo thermometer in 1612. But patients can (and do) die soon after they get a clean bill of health, [...]
Leaders at the G-20 meeting in Korea last week agreed they will establish early warning indicators of economic imbalances. The G20 communiqué said : “We will strengthen multilateral cooperation to promote external sustainability and pursue the full range of policies conducive to reducing excessive imbalances and maintaining current account imbalances at sustainable levels. Persistently large [...]
This week the Conference Board’s leading economic indicators were released in the US and Canada. Both forecast, according to reports, somewhat weak, economic growth in the months ahead. Nobel winning economist Paul Samuelson quipped in 1966 that “Wall Street indexes predicted nine out of the last five recessions.” Are they any better today? Are the [...]
Does the Baltic Dry Index really give a leading indicator of economic activity?