Tag Archives: Consumer Metrics Institute

Updates On Economic Indicators November 2010

Here is an update on various indicators that are supposed to predict and/or depict economic activity.  These indicators have been discussed in previous blog posts:

The November Chicago Fed National Activity Index (CFNAI)(pdf) updated as of November 22, 2010:

The Consumer Metrics Institute Contraction Watch:

The USA TODAY/IHS Global Insight Economic Outlook Index:

An excerpt from the October 27 Release, titled “Latest economic index forecasts weak growth through first quarter” :

“The October update of the USA TODAY/IHS Global Insight Economic Outlook Index shows real GDP growth, at a six-month annualized growth rate, slowing to 1.4% in October and then increasing to 2.0% in February and March, as weak housing and employment conditions continue to impede growth.”

The ECRI WLI (Weekly Leading Index):

As of 11/12/10 the WLI was at 124.3 and the WLI, Gr. was at -4.5%.  A chart of the growth rates of the Weekly Leading and Weekly Coincident Indexes:

The Dow Jones ESI (Economic Sentiment Indicator):

The Indicator as of November 1 was at 43.9, as seen below:

An excerpt from the November 1 release:

“The Dow Jones Economic Indicator (ESI) jumped 3.2  points to 43.9  in October, an unusually strong gain. In back-testing through 1990, election year Octobers averaged a 0.3 point rise. The ESI is now at its highest point since December 2007.

October’s gain, however, was preceded by a 2.5 point drop in September. The ESI’s turbulence implies that the economy is teetering between a slow climb up and a relapse.

“The Dow Jones ESI rebounded in October from its dip the previous month, resuming a modest upward trend seen during much of the year,” Dow Jones Newswires “Money Talks” Columnist Alen Mattich said. “The indicator, however, is still well below levels seen during normal expansions. The October number was not particularly boosted by press coverage of impending quantitative easing from the Federal Reserve or from any one off factors, supporting the view that it reflects self sustaining growth in the economy.”

The Aruoba-Diebold-Scotti Business Conditions (ADS) Index:

Here is the latest chart, depicting 11-13-08 to 11-13-10:

The Conference Board Leading (LEI) and Coincident (CEI) Economic Indexes:

As per the November 18 release, the LEI was at 111.3 and the CEI was at 101.5 in October.

An excerpt from the November 18, 2010 Press Release:

“Says Ken Goldstein, economist at The Conference Board: “The economy is slow, but latest data on the U.S. LEI suggest that change may be around the corner. Expect modest holiday sales, driven by steep discounting. But following a post-holiday lull, the indicators are suggesting a mild pickup this spring.”

_________

I post various indicators and indices because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not necessarily agree with what they depict or imply.

A Special Note concerning our economic situation is found here

SPX at 1197.84 as this post is written

Updates On Economic Indicators October 2010

Here is an update on various indicators that are supposed to predict and/or depict economic activity.  These indicators have been discussed in previous blog posts:

The October Chicago Fed National Activity Index (CFNAI)(pdf) updated as of October 25, 2010:

The Consumer Metrics Institute Contraction Watch:

The USA TODAY/IHS Global Insight Economic Outlook Index:

An excerpt from the October 28 Release, titled “Latest economic index forecasts weak growth through first quarter” :

“The October update of the USA TODAY/IHS Global Insight Economic Outlook Index shows real GDP growth, at a six-month annualized growth rate, slowing to 1.4% in October and then increasing to 2.0% in February and March, as weak housing and employment conditions continue to impede growth.”

The ECRI WLI (Weekly Leading Index):

As of 10/15/10 the WLI was at 122.1 and the WLI, Gr. was at -6.8%.  A chart of the growth rates of the Weekly Leading and Weekly Coincident Indexes:

The Dow Jones ESI (Economic Sentiment Indicator):

The Indicator as of September 30 was at 40.7, as seen below:

An excerpt from the September 30 release:

“Following five months of modest but steady gains, the Dow Jones Economic Indicator (ESI) fell to 40.7 in September, down from 43.2 in August and its largest one-month drop since October 2008.  And while the Indicator has historically declined in September, there are signs that the economic recovery is faltering with a sharp increase in negative economic stories during the last seven days of the month.”

The Aruoba-Diebold-Scotti Business Conditions (ADS) Index:

Here is the latest chart, updated through 10-23-10:

The Conference Board Leading (LEI) and Coincident (CEI) Economic Indexes:

As per the October 21 release, the LEI was at 110.4 and the CEI was at 101.4 in September.

An excerpt from the October 21, 2010 Press Release:

“Says Ken Goldstein, economist at The Conference Board:  “More than a year after the recession officially ended, the economy is slow and has no forward momentum.  The LEI suggests little change in economic conditions through the holidays or the early months of 2011.”

_________

I post various indicators and indices because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not necessarily agree with what they depict or imply.

A Special Note concerning our economic situation is found here

SPX at 1183.78 as this post is written


Consumer Metrics Institute Readings: From Bad To Worse

This post highlights current readings from the Consumer Metrics Institute.  Previous posts solely concerning the Consumer Metrics Institute (CMI) can be found on August 23, July 27 and March 31;  as well CMI data is included in the monthly “Updates On Economic Indicators.”

Here are a couple of charts concerning the CMI’s Daily Growth Index, as seen at Doug Short’s site on 10/5/10:

(click on charts to enlarge images)

This chart shows the CMI Daily Growth Index vs. GDP and the S&P500.  I would like to highlight two notable items (among the many that I have commented upon in the aforementioned posts of August 23, July 27 and March 31).  First, as one can see the CMI Daily Growth Index is now (at -6.13) below the low experienced in 2008, which I view as highly notable and disconcerting, especially on an “all things considered” basis.  Second, another notable item is how the official (as defined by NBER) recession period, seen in gray, contrasts with the CMI’s Daily Growth Index, especially after June 2009, the official end of the recession.

The second chart, as seen below, contrasts the Daily Growth Index’s movements and durations from its 2008 and 2010 declines:

As seen in this chart, there are various disconcerting dynamics.  Perhaps most troubling is that the 2010 contraction appears significantly more pernicious than that of the 2008 decline  – with little if any indication that the current contraction will soon reverse.

A Special Note concerning our economic situation is found here

SPX at 1160.75 as this post is written

Updates On Economic Indicators September 2010

Here is an update on various indicators that are supposed to predict and/or depict economic activity.  These indicators have been discussed in previous blog posts:

The September Chicago Fed National Activity Index (CFNAI)(pdf) updated as of September 27, 2010:

The Consumer Metrics Institute Contraction Watch:

The USA TODAY/IHS Global Insight Economic Outlook Index:

An excerpt from August 31, 2010:

“The August update of the USA TODAY/IHS Global Insight Economic Outlook Index shows real GDP growth, at a six-month annualized growth rate, slowing to 1.3% in November through January. The end of government stimulus spending and inventory buildup combined with continuing high unemployment, a weak housing market, tight credit and high debt are behind the slowdown.”

The ECRI WLI (Weekly Leading Index):

As of 9/17/10 the WLI was at 122.2 and the WLI, Gr. was at -8.7%.  A chart of the growth rates of the Weekly Leading and Weekly Coincident Indexes:

The Dow Jones ESI (Economic Sentiment Indicator):

The Indicator as of August 31 was at 43.2, as seen below:

An excerpt from the August 31 Press Release:

“The ESI’s stability during recent months belies some of the recent weakness seen in other sentiment surveys and suggests that the underlying momentum of the U.S. economy, including employment, remains positive,” Dow Jones Newswires “Money Talks” Columnist Alen Mattich said. “However, the ESI remains well below the 50-plus levels that characterize normal expansions. This relative weakness suggests it would take little to push the economy back into recessionary conditions.”

The ESI is determined using an economic sentiment analysis algorithm to review news coverage in 15 daily newspapers across the U.S.”

The Aruoba-Diebold-Scotti Business Conditions (ADS) Index:

Here is the latest chart, updated through 9-18-10:

The Conference Board Leading (LEI) and Coincident (CEI) Economic Indexes:

As per the September 23 release, the LEI was at 110.2 and the CEI was at 101.3 in August.

An excerpt from the August 23, 2010 Press Release:

“Says Ken Goldstein, economist at The Conference Board:  “While the recession officially ended in June 2009, the recent pace of growth has been disappointingly slow, fueling concern that the economic recovery could fade and the U.S. could slide back into recession.  However, latest data from the U.S. LEI suggests little change in economic conditions over the next few months.  Expect more of the same – a weak economy with little forward momentum through 2010 and early 2011.”

“New Financial Conditions Index”

I wrote a post concerning this index on 3/10/10.  There is currently no updated value available.

_________

I post various indicators and indices because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not necessarily agree with what they depict or imply.

SPX at 1148.67 as this post is written

Updates On Economic Indicators August 2010

Here is an update on various indicators that are supposed to predict and/or depict economic activity.  These indicators have been discussed in previous blog posts:

The August Chicago Fed National Activity Index (CFNAI)(pdf) updated as of August 23, 2010:

The Consumer Metrics Institute Contraction Watch:

The USA TODAY/IHS Global Insight Economic Outlook Index:

An excerpt from August 16, 2010:

“The July 28 update of the USA TODAY/IHS Global Insight Economic Outlook Index shows real GDP growth, at a six-month annualized growth rate, slowing to 2.5% in December. The end of government stimulus spending and inventory buildup combined with continuing high unemployment, a weak housing market, tight credit and high debt are behind the slowdown.”

The ECRI WLI (Weekly Leading Index):

As of 8/13/10 the WLI was at 120.8 and the WLI, Gr. was at -10.0%.  A chart of the growth rates of the Weekly Leading and Weekly Coincident Indexes:

The Dow Jones ESI (Economic Sentiment Indicator):

The Indicator as of August 2 was at 42.3, as seen below:

An excerpt from the August 2 Press Release:

“The Dow Jones Economic Sentiment Indicator (ESI) has given an upbeat signal on the economy, registering its biggest rise since October and a return to the level of June 2008.”

also:

““The Dow Jones ESI’s rise suggests the prospects of a double dip recession have receded,” Dow Jones Newswires “Money Talks” Columnist Alen Mattich said. “The ESI is still at a very low level, just above where it has in the past signalled a drop into recession. The indicator, however, has been steadily climbing since April 2010 which implies continued economic improvement.”

also:

“The ESI’s back-testing to 1990 shows that the ESI clearly highlighted the risk that the U.S. economy was sliding into recession in 2001 and 2008 and suggests the indicator can help predict economic turning points as much as seven months in advance of other indicators.”

The Aruoba-Diebold-Scotti Business Conditions (ADS) Index:

Here is the latest chart, updated through 8-14-10:

The Conference Board Leading (LEI) and Coincident (CEI) Economic Indexes:

As per the August 19 release, the LEI was at 109.8 and the CEI was at 101.4 in July.

An excerpt from the August 19, 2010 Press Release:

“”The indicators point to a slow expansion through the end of the year,” says Ken Goldstein, economist at The Conference Board.”

“New Financial Conditions Index”

I wrote a post concerning this index on 3/10/10.  There is currently no updated value available.

_________

I post various indicators and indices because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not necessarily agree with what they depict or imply.

SPX at 1067.36 as this post is written

Consumer Metrics Institute Data: Red Alert?

This post highlights current readings from the Consumer Metrics Institute.  Previous posts solely concerning the Consumer Metrics Institute (CMI) can be found on July 27 and March 31;  as well CMI data is included in the monthly “Updates On Economic Indicators.”

Here is a chart of CMI’s Daily Growth Index: (click on chart images to enlarge)

As one can see, the Daily Growth Index is rapidly approaching the low of the 2008 reading; perhaps more importantly there seems to be no signs of abatement in its downward trajectory.  Also of great importance is the rift between its reading and that of Quarterly GDP.

The second chart is CMI’s Contraction Watch:

Here again, the readings are rather draconian, even when compared to the 2008 event.

Lastly, here is a chart from Doug Short’s blog of 8-22-10.  It shows CMI’s Growth Index vs. the S&P500 and GDP.  As one can see, if one believes in the efficacy of CMI’s Daily Growth Index both the S&P500 and GDP seem destined for rather sharp downward trajectories:

Of course, before one can draw solid conclusions from CMI’s data, one has to have a solid understanding of the methodologies used.  This is difficult with CMI’s data as it is proprietary, and as such, it is much akin to other “black box” mechanisms where computations aren’t disclosed.

As well, as CMI stated in their August 20 commentary, “Remember that our data only reflects consumer demand for discretionary durable goods.”

However, from an “all-things-considered” basis, it would appear as if CMI’s readings present the most negative forecasts among popularly published indicators.

As I stated in the July 27 post, “It should be very interesting to see how the CMI’s readings evolve as compared to actual economic activity…”

A Special Note concerning our economic situation is found here

SPX at 1071.69 as this post is written

Updates On Economic Indicators July 2010

Here is an update on various indicators that are supposed to predict and/or depict economic activity.  These indicators have been discussed in previous blog posts:

The July Chicago Fed National Activity Index (CFNAI)(pdf) updated as of July 26, 2010:

The Consumer Metrics Institute Contraction Watch:

The USA TODAY/IHS Global Insight Economic Outlook Index:

An excerpt from July 26, 2010:

“The July update of the USA TODAY/IHS Global Insight Economic Outlook Index shows real GDP growth, at a six-month annualized growth rate, slowing to 2.5% in December. The end of government stimulus spending and inventory buildup combined with continuing high unemployment, a weak housing market, tight credit and high debt are behind the slowdown.

The index predicts future real GDP growth (gross domestic product, adjusted for inflation) based on 11 leading economic and financial indicators.

Four of the 11 indicators were positive in July, down from five last month and the lowest number since USA TODAY first published the index in June 2009.”

The ECRI WLI (Weekly Leading Index):

As of 7/16/10 the WLI was at 120.17 and the WLI, Gr. was at -10.5%.  A chart of the Weekly Leading and Weekly Coincident Indexes:

The Dow Jones ESI (Economic Sentiment Indicator):

The Indicator as of June 30 was at 40.3, as seen below:

An excerpt from the June 30 Press Release:

““The ESI’s modest and steady rise over the last couple of months is a positive sign, but the U.S. is not out of the woods yet,” Dow Jones Newswires “Money Talks” Columnist Alen Mattich said. “Anxiety about the U.S.’s employment conditions and questions around Europe’s stability are key concerns that are unlikely to subside soon.”

The Dow Jones Economic Sentiment Indicator aims to predict the health of the U.S. economy by analyzing the coverage of 15 major daily newspapers in the U.S. Using a proprietary algorithm and derived data technology, the ESI examines every article in each of the newspapers for positive and negative sentiment about the economy. The indicator is calculated through Dow Jones Insight, a media tracking and analysis tool. The technology used for the ESI also powers Dow Jones Lexicon, a proprietary dictionary that allows traders and analysts to determine sentiment, frequency and other relevant complex patterns within news to develop predictive trading strategies.”

The Aruoba-Diebold-Scotti Business Conditions (ADS) Index:

Here is the latest chart, updated through 7-17-10:

The Conference Board Leading (LEI) and Coincident (CEI) Economic Indexes:

As of July 22, the LEI was at 109.8 and the CEI was at 101.4 in June.

An excerpt from the June 22, 2010 Press Release:

“”The indicators point to slower growth through the fall,” says Ken Goldstein, economist at The Conference Board.”

“New Financial Conditions Index”

I wrote a post concerning this index on 3/10/10.  There is currently no updated value available.

_________

I post various indicators and indices because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not necessarily agree with what they depict or imply.

back to <home>

SPX at 1113.68 as this post is written

Consumer Metrics Institute’s Readings

I have been following The Consumer Metrics Institute’s work since March.  I have previously written two posts focusing on their work (both found on March 31), as well as included it in the monthly “Updates On Economic Indicators.”

To briefly summarize, I find their work and methodologies very interesting, especially given that they appear quite different than other such measures that purport to depict/predict economic activity.

Here is one of their current charts, that of the Daily Growth Index:

Given its proprietary methodologies and relatively limited history, it seems likely that varying interpretations of The Consumer Metrics Institute’s data can be supported.   My interpretation of the chart is that the growing “rift” between GDP and the CMI’s Consumer Growth Index is significant.  This begs the question as to which trend will prove accurate going forward; that of GDP growth around 3% (that which is the current consensus among economists for both full-year 2010 & 2011) or that of the CMI’s Growth Index, which seems to be indicating some type of impending negative (perhaps significantly so) GDP growth rate?

Of course, one can argue that the CMI’s growth rate can suddenly materially increase, which would likely support a positive GDP growth rate.   Of course, such a sudden increase is possible, but my “guess” (which is seemingly all that one can offer, given the proprietary nature of the data) is that such is unlikely.

Of further note is the CMI’s “Contraction Watch” chart (not shown) and its implications.

Of course, the CMI’s readings of weakening economic activity are not entirely unique.  ECRI’s recent WLI Growth readings have generated much discussions lately given the WLI Growth’s significant and rapid decline.

It should be very interesting to see how the CMI’s readings evolve as compared to actual economic activity…

back to <home>

SPX at 1115.01 as this post is written

Updates On Economic Indicators

Here is an update on various indicators that are supposed to predict and/or depict economic activity.  These indicators have been discussed in previous blog posts:

The June Chicago Fed National Activity Index (CFNAI)(pdf) updated as of June 28, 2010:

The Consumer Metrics Institute Contraction Watch:

The USA TODAY/IHS Global Insight Economic Outlook Index:

An excerpt from June 23, 2010:

“The June update of the USA TODAY/IHS Global Insight Economic Outlook Index shows real GDP growth, at a six-month annualized growth rate, slowing from 4.1% in April to 3.1% in November. Increased consumer and business equipment and software spending fueled strong growth in the spring, but tight credit, high debt and continuing high unemployment will slow growth in the second half of the year.”

The ECRI WLI (Weekly Leading Index):

As of 6/18/10 the WLI was at 122.9 and the WLI, Gr. was at -6.9%.  A chart of the Weekly Leading and Weekly Coincident Indexes:

An excerpt from a June 25 Reuters article: “”After falling for six weeks, the uptick in the level of the Weekly Leading Index suggests some tentative stabilization, but the continuing decline in its growth rate to a 56-week low underscores the inevitability of the slowdown,” said Lakshman Achuthan, managing director of ECRI.”

The Dow Jones ESI (Economic Sentiment Indicator):

The Indicator as of June 1 was at 39.4.  An excerpt from the June 1 Press Release:

““Overall, the ESI has been flat during recent months. This likely reflects the failure of a significant pickup in underlying employment trends and suggests that while the U.S. economy is no longer in recession, its recovery is subdued,” Dow Jones Newswires “Money Talks” Columnist Alen Mattich said. “The modest rise of the Dow Jones ESI in May is largely due to a reversal of April’s slight downward distortion caused by coverage of the Congressional inquiry into Goldman Sachs.”

The Aruoba-Diebold-Scotti Business Conditions (ADS) Index:

Here is the latest chart, updated through 6-19-10:

The Conference Board Leading (LEI) and Coincident (CEI) Economic Indexes, as of June 17, 2010:

The LEI was at 109.9 and the CEI was at 101.3 in May.

An excerpt from the June 17, 2010 Press Release:

““The LEI for the United States has been rising since April 2009, and though its growth rate has slowed in 2010, it is well above its most recent peak in December 2006,” says Ataman Ozyildirim, economist at The Conference Board. “Correspondingly, current economic conditions, as measured by The Conference Board Coincident Economic Index® (CEI) for the United States, have been improving steadily since November 2009, thanks to gains in payroll employment and industrial production.”

“New Financial Conditions Index”

I had a post of this index on 3/10/10.  There is currently no updated value available.

_________

I post various indicators and indices because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not necessarily agree with what they depict or imply.

back to <home>

SPX at 1041.24 as this post is written

Updates On Economic Indicators

Here is an update on various indicators that are supposed to predict and/or depict economic activity.  These indicators have been discussed in previous blog posts:

The May Chicago Fed National Activity Index (CFNAI) (pdf) updated as of May 24, 2010:

The Consumer Metrics Institute Contraction Watch:

The USA TODAY/IHS Global Insight Economic Outlook Index:

An excerpt of May 24, 2010:

“The May update of the USA TODAY/IHS Global Insight Economic Outlook Index shows strong growth in real GDP, at a six-month annualized growth rate, in April and May followed by slower, yet solid, growth in June through October. Increased consumer and business spending will fuel strong growth into the second quarter, but tight credit, high debt and still-high unemployment will moderate growth in the second half of the year.”

The ECRI WLI (Weekly Leading Index) : Last updated 5/14/10:

The WLI is at 127.3

The Dow Jones ESI (Economic Sentiment Indicator):

The Index as of April 30 was at 38.3.  The title of the April 30 news release is “Dow Jones Economic Sentiment Indicator slips to 38.3 for April; signals that Recovery has yet to firmly take hold.”

The Aruoba-Diebold-Scotti Business Conditions (ADS) Index

Here is the latest chart, updated through 5-15-10:

“New Financial Conditions Index”

I had a post of this index on 3/10/10.  There is currently no updated value available.

_________

I post various indicators and indices because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not necessarily agree with what they depict or imply.

back to <home>

SPX at 1074.14 as this post is written