Daddy, Is The Recession Over Yet? Handy Chart Holds The Answer
When are we going to pull out of the recession? The Kiplinger Recovery Index thinks it can tell you, using a sophisticated system of red and green colored boxes and checkmarks and X's.
They look at at six major indicators: consumer confidence, durable goods, existing home sales, interest-rate spread, jobless claims and retail sales. An X means they're still crap. A check means thumbs up. The greener the bar, the less crappy. If at least three of these get checkmarks, then the recession is over. Breakdowns tell you what the indicator is, why it matters, and what to watch.
A useful tool for cutting through the swirl of data and hype, updated frequently and always accessible at kiplinger.com/businessresource/recovery.
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I've found the easiest way to check the pulse of the economy is to look at what offers domestic car manufacturers are giving. If it's 0% for 72 months, $1500 cash back, free gas for a year and a puppy, times are probably bad.
It's a good indicator if you're interested in the current state of the economy, and as a small business owner I very much am. That said we really won't know if we're out of the recession until lagging indicators, mainly quarterly GDP reports, tell us the economy as a whole is growing again. I hope that's soon...
My leading indicator is the number of people who complain to me about their jobs.
None - few complainers = Bad economy
Few - some complainers = Improving economy
Some - everyone complaining = Good economy
@hicks: Free puppy? That's a good idea, but can I trade it in with the car when they're both old and boring?
To borrow a quote:
Recession is when your neighbor loses his job. Depression is when you lose yours. And recovery is when Obama loses his.
My opinion is that we're heading into a depression. We still have too much bad debt in the system and the Fed is trying wayy to hard and meddling in the economy much more so than is allowed.
Looks too much like a dead cat bounce to me.
@grapedog: So, there is some magical limit to government meddling that can supposedly tip the scale towards a depression? You don't think irresponsible corporate meddling had anything to do with the situation? If you don't like government meddling, then look to the CEOs of the companies that practically begged them to do so. It was like trusting a bunch of teenagers to be home alone and come back to find a party in progress and the house trashed. They deserve everything they get.
@I Love New Jersey: heh. I was going to post a quote, too, but yours is better.
(In case anyone's wondering, it would have been "For every complex problem, there is a solution that is simple, neat, and wrong")
I don't like graphs like this,for the simple reason that past performance can't predict future results.The graph could be green all day,but thousands could be laid off the day after it comes out.
Worse,the fundamental problems of our economy have not been solved.Major corporations are taking no prisoners on cutting pay and compensation,and as downright greedy/dishonest major companies are today,well never see a pay increase or hiring boom on the next uptick anyhow.
The major,no BS sign of a recovery is when you see books predicting the next recession.
Damn, Jobless claims is definitely a cylon :(