Tag Archives: economic weakness

Charts Indicating Economic Weakness – April 2019

U.S. Economic Indicators

Throughout this site there are many discussions of economic indicators.  At this time, the readings of various indicators are especially notable.  This post is the latest in a series of posts indicating U.S. economic weakness or a notably low growth rate.

While many U.S. economic indicators – including GDP – are indicating economic growth, others depict (or imply) various degrees of weak growth or economic contraction.  As seen in the April 2019 Wall Street Journal Economic Forecast Survey the consensus (average estimate) among various economists is for 3.0% GDP growth in 2018 and 2.1% GDP growth in 2019.  However,  there are other broad-based economic indicators that seem to imply a weaker growth rate.

As well, it should be remembered that GDP figures can be (substantially) revised.

Charts Indicating U.S. Economic Weakness

Below are a small sampling of charts that depict weak growth or contraction, and a brief comment for each:

Total Federal Receipts

“Total Federal Receipts” growth continues to be intermittent in nature since 2015.  As well, the level of growth does not seem congruent to the (recent) levels of economic growth as seen in aggregate measures such as Real GDP.

“Total Federal Receipts” through March had a last value of $228,811 Million.  Shown below is  the measure displayed on a “Percent Change From Year Ago” basis with value 8.5%, last updated April 10, 2019:

Total Federal Receipts Percent Change From Year Ago

source:  U.S. Department of the Treasury. Fiscal Service, Total Federal Receipts [MTSR133FMS], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed April 10, 2019: 
https://fred.stlouisfed.org/series/MTSR133FMS

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Federal Government Current Tax Receipts:  Personal Current Taxes

Another measure that depicts weak growth is that of “Federal government current tax receipts: Personal Current Taxes.”  Through the fourth quarter the value is $1648.173 Billion Seasonally Adjusted Annual Rate (SAAR).  Shown below is the chart, displayed on a “Percent Change From Year Ago” basis with value of .9%, last updated March 28, 2019:

Federal government current tax receipts: Personal Current Taxes - Percent Change From Year Ago

source:  U.S. Bureau of Economic Analysis, Federal government current tax receipts: Personal current taxes [A074RC1Q027SBEA], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed April 11, 2019:
https://fred.stlouisfed.org/series/A074RC1Q027SBEA

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Federal Government Current Tax Receipts:  Taxes On Corporate Income

Another measure that depicts contraction is that of “Federal government current tax receipts: Taxes On Corporate Income.”  Through the fourth quarter the value is $160.899 Billion Seasonally Adjusted Annual Rate (SAAR).  Shown below is the chart, displayed on a “Percent Change From Year Ago” basis with value of -39.1%, last updated March 28, 2019:

Federal government current tax receipts: Taxes On Corporate Income - Percent Change From Year Ago

source: U.S. Bureau of Economic Analysis, Federal government current tax receipts: Taxes on corporate income [B075RC1Q027SBEA], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed April 11, 2019:
https://fred.stlouisfed.org/series/B075RC1Q027SBEA

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The Chicago Fed National Activity Index (CFNAI)

A broad-based economic indicator that has been implying weaker growth or mild contraction is the Chicago Fed National Activity Index (CFNAI).

The March 2019 Chicago Fed National Activity Index (CFNAI) updated as of March 25, 2019:

The CFNAI, with current reading of -.29:

CFNAI

source:  Federal Reserve Bank of Chicago, Chicago Fed National Activity Index [CFNAI], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed March 25, 2019:
https://fred.stlouisfed.org/series/CFNAI

The CFNAI-MA3 (CFNAI three-month moving average) with current reading of -.18:

CFNAIMA3

source:  Federal Reserve Bank of Chicago, Chicago Fed National Activity Index: Three Month Moving Average [CFNAIMA3], retrieved from FRED, Federal Reserve Bank of St. Louis; March 25, 2019:
https://fred.stlouisfed.org/series/CFNAIMA3

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Total Construction Spending:  Commercial

“Total Construction Spending: Commercial” is a measure of construction exhibiting a contraction on a “Percent Change From Year Ago” basis.   This measure through February had a last value of $87,810 Million.  Shown below is the measure displayed on a “Percent Change From Year Ago” basis with a value of -5.6%, last updated April 1, 2019:

Total Construction Spending: Commercial - Percent Change From Year Ago

source:  U.S. Bureau of the Census, Total Construction Spending: Commercial [TLCOMCONS], retrieved from FRED, Federal Reserve Bank of St. Louis, accessed April 11,2019: https://fred.stlouisfed.org/series/TLCOMCONS

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Other Indicators

As mentioned previously, many other indicators discussed on this site indicate economic weakness or economic contraction, if not outright (gravely) problematical economic conditions.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2888.32 as this post is written

Charts Indicating Economic Weakness – March 2019

U.S. Economic Indicators

Throughout this site there are many discussions of economic indicators.  At this time, the readings of various indicators are especially notable.  This post is the latest in a series of posts indicating U.S. economic weakness or a notably low growth rate.

While many U.S. economic indicators – including GDP – are indicating economic growth, others depict (or imply) various degrees of weak growth or economic contraction.  As seen in the February 2019 Wall Street Journal Economic Forecast Survey the consensus (average estimate) among various economists is for 3.0% GDP growth in 2018 and 2.2% GDP growth in 2019.  However,  there are other broad-based economic indicators that seem to imply a weaker growth rate.

As well, it should be remembered that GDP figures can be (substantially) revised.

Charts Indicating U.S. Economic Weakness

Below are a small sampling of charts that depict weak growth or contraction, and a brief comment for each:

Total Federal Receipts

“Total Federal Receipts” growth continues to be intermittent in nature since 2015.  As well, the level of growth does not seem congruent to the (recent) levels of economic growth as seen in aggregate measures such as Real GDP.

“Total Federal Receipts” through January had a last value of $339,980 Million.  Shown below is  the measure displayed on a “Percent Change From Year Ago” basis with value -5.8%, last updated March 5, 2019:

Total Federal Receipts Percent Change From Year Ago

source:  U.S. Department of the Treasury. Fiscal Service, Total Federal Receipts [MTSR133FMS], retrieved from FRED, Federal Reserve Bank of St. Louis, accessed March 5, 2019: 
https://fred.stlouisfed.org/series/MTSR133FMS

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Regional Manufacturing Surveys

Various Federal Reserve regional manufacturing surveys are indicating either a significant weakening in growth or a decline in various aspects of activity.

Below is a chart of various regional manufacturing surveys, depicted on a 3-month moving average, from Doug Short’s site post of February 28, 2019 titled “February Regional Fed Manufacturing Overview“:

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Total Construction Spending:  Commercial

“Total Construction Spending: Commercial” is a measure of construction exhibiting a contraction on a “Percent Change From Year Ago” basis.   This measure through December had a last value of $86,188 Million.  Shown below is the measure displayed on a “Percent Change From Year Ago” basis with a value of -3.2%, last updated March 4, 2019:

Total Construction Spending: Commercial

source:  U.S. Bureau of the Census, Total Construction Spending: Commercial [TLCOMCONS], retrieved from FRED, Federal Reserve Bank of St. Louis, accessed March 4,2019: 2019:https://fred.stlouisfed.org/series/TLCOMCONS

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

Among the broad-based economic indicators that seem to imply subdued or intermittent growth is that of the Aruoba-Diebold-Scotti Business Conditions Index (ADS Index.)  Below is a chart of the index from the year 2000 through March 2, 2019, with a value of -.4717, as of the March 8 update:

ADS Index

source:  Federal Reserve Bank of Philadelphia, Aruoba-Diebold-Scotti Business Conditions Index (ADS Index)

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The Chicago Fed National Activity Index (CFNAI)

Another broad-based economic indicator that has been implying weaker growth or mild contraction is the Chicago Fed National Activity Index (CFNAI).

The February 2019 Chicago Fed National Activity Index (CFNAI), last updated as of February 25, 2019:

The CFNAI, with current reading of -.43:

CFNAI

source:  Federal Reserve Bank of Chicago, Chicago Fed National Activity Index [CFNAI], retrieved from FRED, Federal Reserve Bank of St. Louis, February 25, 2019:
https://fred.stlouisfed.org/series/CFNAI

The CFNAI-MA3, with current reading of 0:

CFNAIMA3

source:  Federal Reserve Bank of Chicago, Chicago Fed National Activity Index: Three Month Moving Average [CFNAIMA3], retrieved from FRED, Federal Reserve Bank of St. Louis, February 25, 2019:
https://fred.stlouisfed.org/series/CFNAIMA3

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Other Indicators

As mentioned previously, many other indicators discussed on this site indicate economic weakness or economic contraction, if not outright (gravely) problematical economic conditions.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2743.07 as this post is written

Charts Indicating Economic Weakness – February 2019

U.S. Economic Indicators

Throughout this site there are many discussions of economic indicators.  At this time, the readings of various indicators are especially notable.  This post is the latest in a series of posts indicating U.S. economic weakness or a notably low growth rate.

While many U.S. economic indicators – including GDP – are indicating economic growth, others depict (or imply) various degrees of weak growth or economic contraction.  As seen in the February 2019 Wall Street Journal Economic Forecast Survey the consensus (average estimate) among various economists is for 3.0% GDP growth in 2018 and 2.2% GDP growth in 2019.  However,  there are other broad-based economic indicators that seem to imply a weaker growth rate.

As well, it should be remembered that GDP figures can be (substantially) revised.

Charts Indicating U.S. Economic Weakness

Below are a small sampling of charts that depict weak growth or contraction, and a brief comment for each:

Total Federal Receipts

“Total Federal Receipts” growth continues to be intermittent in nature since 2015.  As well, the level of growth does not seem congruent to the (recent) levels of economic growth as seen in aggregate measures such as Real GDP.

“Total Federal Receipts” through December had a last value of $312,584 Million.  Shown below is  the measure displayed on a “Percent Change From Year Ago” basis with value -4.1%, last updated February 13, 2019:

MTSR133FMS Percent Change From Year Ago

source:  U.S. Department of the Treasury. Fiscal Service, Total Federal Receipts [MTSR133FMS], retrieved from FRED, Federal Reserve Bank of St. Louis, accessed February 13, 2019:  
https://fred.stlouisfed.org/series/MTSR133FMS

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Loan Demand And Related Measures

As seen in previous updates, various aspects of lending growth and related measures have shown a contraction.  Shown below is a measure, Net Percentage of Domestic Banks Reporting Stronger Demand for Credit Card Loans, that shows a decline.  The current value is -17.4% as of the February 4, 2019 quarterly update:

DEMCC

source: Board of Governors of the Federal Reserve System (US), Net Percentage of Domestic Banks Reporting Stronger Demand for Credit Card Loans [DEMCC], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed February 11, 2019:
https://fred.stlouisfed.org/series/DEMCC

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Vehicle Miles Traveled

I continue to find the flagging growth trend in the “Vehicle Miles Traveled” (NSA) measure since 2015 to be notable.

“Vehicle Miles Traveled” through November had a last value of 258,533 Million.  Shown below is  the measure displayed on a “Percent Change From Year Ago” basis with value .3%, last updated January 17, 2019:

Vehicle Miles Traveled Percent Change From Year Ago chart

source:   U.S. Federal Highway Administration, Vehicle Miles Traveled [TRFVOLUSM227NFWA], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed February 11, 2019: https://fred.stlouisfed.org/series/TRFVOLUSM227NFWA

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Total Construction Spending:  Commercial

“Total Construction Spending: Commercial” is a measure of construction exhibiting a contraction on a “Percent Change From Year Ago” basis.   This measure through November had a last value of $87,459 Million.  Shown below is the measure displayed on a “Percent Change From Year Ago” basis with a value of -.4%, last updated February 5, 2019:

Total Construction Spending: Commercial Percent Change From Year Ago

source:  U.S. Bureau of the Census, Total Construction Spending: Commercial [TLCOMCONS], retrieved from FRED, Federal Reserve Bank of St. Louis, accessed February 11, 2019: https://fred.stlouisfed.org/series/TLCOMCONS

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Rail Freight Carloads

“Rail Freight Carloads” continues to show a downward progression.  Shown below is a chart with data through November (last value of 1,115,510, updated January 15, 2019):

RAILFRTCARLOADSD11

source:  U.S. Bureau of Transportation Statistics, Rail Freight Carloads [RAILFRTCARLOADSD11], retrieved from FRED, Federal Reserve Bank of St. Louis;  accessed February 12, 2019: https://fred.stlouisfed.org/series/RAILFRTCARLOADSD11

Here is the same measure on a “Percent Change From Year Ago” basis, with value .1%:

Rail Freight Carloads Percent Change From Year Ago

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Other Indicators

As mentioned previously, many other indicators discussed on this site indicate weak economic growth or economic contraction, if not outright (gravely) problematical economic conditions.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2753.03 as this post is written


Charts Indicating Economic Weakness – January 2019

U.S. Economic Indicators

Throughout this site there are many discussions of economic indicators.  At this time, the readings of various indicators are especially notable.  This post is the latest in a series of posts indicating U.S. economic weakness or a notably low growth rate.

While many U.S. economic indicators – including GDP – are indicating economic growth, others depict (or imply) various degrees of weak growth or economic contraction.  As seen in the January 2019 Wall Street Journal Economic Forecast Survey the consensus (average estimate) among various economists is for 3.1% GDP growth in 2018 and 2.2% GDP growth in 2019.  However,  there are other broad-based economic indicators that seem to imply a weaker growth rate.

As well, it should be remembered that GDP figures can be (substantially) revised.

Charts Indicating U.S. Economic Weakness

Below are a small sampling of charts that depict weak growth or contraction, and a brief comment for each:

Regional Manufacturing Surveys

Various Federal Reserve regional manufacturing surveys are indicating either a significant weakening in growth or a decline in various aspects of activity.

Below is a chart of the Dallas Fed General Business Activity chart, from Doug Short’s site post of December 31, 2018 titled “December Dallas Fed Manufacturing Outlook at 2.5 Year Low“:

Texas Manufacturing General Business Activity

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Philadelphia Federal Reserve’s Nonmanufacturing Business Outlook Survey

Another indicator that is flagging is the Current General Activity diffusion index from the Philadelphia Federal Reserve’s Nonmanufacturing Business Outlook Survey. Below is a chart through December, with a value of 4.3:

GABNDIF066MNFRBPHI

source: Federal Reserve Bank of Philadelphia, Current General Activity, Perceptions of Respondents for their Firm; Diffusion Index for FRB – Philadelphia District [GABNDIF066MNFRBPHI], retrieved from FRED, Federal Reserve Bank of St. Louis: accessed January 11, 2019: https://fred.stlouisfed.org/series/GABNDIF066MNFRBPHI

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Unemployment

I have written extensively concerning unemployment, as the current and future unemployment issue is of tremendous importance, but is widely misunderstood.

The consensus belief is that employment is robust, with the often-cited total nonfarm payroll growth and the current unemployment rate of 3.9%.  However, my analyses continue to indicate that the conclusion that employment is strong is (in many ways) incorrect.  While the unemployment rate indicates that unemployment is (very) low, closer examination indicates that this metric is, for a number of reasons, highly misleading.

My analyses indicate that the underlying dynamics of the unemployment situation remain exceedingly worrisome, especially with regard to the future.  These dynamics are numerous and complex, and greatly lack recognition and understanding, especially as how from an “all-things-considered” standpoint they will evolve in an economic and societal manner.  I have written of the current and future U.S. employment situation on the “U.S. Employment Trends” page.

While there are many charts that can be shown, one that depicts a worrisome trend is the  Civilian Labor Force Participation Rate for those with a Bachelor’s Degree and Higher, 25 years and over.  Among disconcerting aspects of this measure is the long-term (most notably the post-2009) trend, especially given this demographic segment’s characteristics.

The current value as of the January 4, 2019 update (reflecting data through the December employment report) is 73.6%:

LNS11327662

source:  U.S. Bureau of Labor Statistics, Civilian Labor Force Participation Rate: Bachelor’s Degree and Higher, 25 years and over [LNS11327662], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed January 10, 2019: https://fred.stlouisfed.org/series/LNS11327662

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The ECRI WLI, Gr.

The ECRI WLI,Gr. measure has been steadily declining and now is at -6.5% as of the January 11, 2019 update, reflecting data through January 4, 2019.

A chart of the WLI,Gr., with an overlay of U.S. GDP, from the Doug Short’s site ECRI update post of January 11, 2019:

ECRI WLI,Gr.

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Other Indicators

As mentioned previously, many other indicators discussed on this site indicate weak economic growth or economic contraction, if not outright (gravely) problematical economic conditions.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2596.26 as this post is written

Charts Indicating Economic Weakness – December 2018

U.S. Economic Indicators

Throughout this site there are many discussions of economic indicators.  At this time, the readings of various indicators are especially notable.  This post is the latest in a series of posts indicating U.S. economic weakness or a notably low growth rate.

While many U.S. economic indicators – including GDP – are indicating economic growth, others depict (or imply) various degrees of weak growth or economic contraction.  As seen in the December 2018 Wall Street Journal Economic Forecast Survey the consensus (average estimate) among various economists is for 3.1% GDP growth in 2018 and 2.3% GDP growth in 2019.  However,  there are other broad-based economic indicators that seem to imply a weaker growth rate.

As well, it should be remembered that GDP figures can be (substantially) revised.

Charts Indicating U.S. Economic Weakness

Below are a small sampling of charts that depict weak growth or contraction, and a brief comment for each:

Total Federal Receipts

“Total Federal Receipts” growth continues to be intermittent in nature since 2015.  As well, the level of growth does not seem congruent to the (recent) levels of economic growth as seen in aggregate measures such as Real GDP.

“Total Federal Receipts” through November had a last value of $205,961 Million.  Shown below is  the measure displayed on a “Percent Change From Year Ago” basis with value -1.5%, last updated December 13, 2018:

source:  U.S. Department of the Treasury. Fiscal Service, Total Federal Receipts [MTSR133FMS], retrieved from FRED, Federal Reserve Bank of St. Louis, accessed December 13, 2018:  
https://fred.stlouisfed.org/series/MTSR133FMS

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

While the 3rd quarter GDP (Second Estimate)(pdf) was 3.5%, there are other broad-based economic indicators that seem to imply a weaker growth rate.

Among the broad-based economic indicators that seem to imply subdued or intermittent growth is that of the Aruoba-Diebold-Scotti Business Conditions Index (ADS Index.)  Below is a chart of the index from the year 2000 through December 8, 2018, with a value of .0405, as of the December 13 update:

ADS Index

source:  Federal Reserve Bank of Philadelphia, Aruoba-Diebold-Scotti Business Conditions Index (ADS Index)

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Total Construction Spending:  Commercial

“Total Private Construction Spending: Commercial” is a measure of construction exhibiting weak YoY growth.   This measure through October had a last value of $88,686 Million.  Shown below is the measure displayed on a “Percent Change From Year Ago” basis with a value of 1.6%, last updated December 3, 2018:

Total Construction Spending: Commercial YoY

source:  U.S. Bureau of the Census, Total Construction Spending: Commercial [TLCOMCONS], retrieved from FRED, Federal Reserve Bank of St. Louis, accessed December 13, 2018:  
https://fred.stlouisfed.org/series/TLCOMCONS

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The Yield Curve

Many people believe that the Yield Curve is a leading economic indicator for the United States economy.

On March 1, 2010, I wrote a post on the issue, titled “The Yield Curve As A Leading Economic Indicator.”

While I continue to have the stated reservations regarding the “yield curve” as an indicator, I do believe that it should be monitored.

As an indication of the yield curve (i.e. a yield curve proxy), below is a weekly chart from January 1, 1990 through December 13, 2018.  The top two plots show the 10-Year Treasury and 2-Year Treasury yields.  The third plot shows the (yield) spread between the 10-Year Treasury and 2-Year Treasury, with the December 13, 2018 closing value of .16%.  The bottom plot shows the S&P500:

(click on chart to enlarge image)(chart courtesy of StockCharts.com; chart creation and annotation by the author)

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Loan Demand And Related Measures

As seen in previous updates, various aspects of lending growth and related measures have shown a marked slowing in the growth rate.  Shown below is a measure, Net Percentage of Domestic Banks Reporting Stronger Demand for Commercial and Industrial Loans from Large and Middle-Market Firms, that shows a decline.  The current value is -14.5% as of the November 14, 2018 quarterly update:

DRSDCILM 11-14-18

source:  Board of Governors of the Federal Reserve System (US), Net Percentage of Domestic Banks Reporting Stronger Demand for Commercial and Industrial Loans from Large and Middle-Market Firms [DRSDCILM], retrieved from FRED, Federal Reserve Bank of St. Louis;  accessed December 11, 2018:  
https://fred.stlouisfed.org/series/DRSDCILM

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The ECRI WLI (Weekly Leading Index)

The ECRI WLI,Gr. measure has been declining and now is at -4.1% as of the December 7, 2018 update, reflecting data through November 30, 2018.

A chart of the WLI,Gr., with an overlay of U.S. GDP, from the Doug Short’s site ECRI update post of December 7, 2018:

ECRI WLI,Gr.

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Other Indicators

As mentioned previously, many other indicators discussed on this site indicate weak economic growth or economic contraction, if not outright (gravely) problematical economic conditions.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2650.54 as this post is written

Charts Indicating Economic Weakness – November 2018

U.S. Economic Indicators

Throughout this site there are many discussions of economic indicators.  At this time, the readings of various indicators are especially notable.  This post is the latest in a series of posts indicating U.S. economic weakness or a notably low growth rate.

While many U.S. economic indicators – including GDP – are indicating economic growth, others depict (or imply) various degrees of weak growth or economic contraction.  As seen in the October 2018 Wall Street Journal Economic Forecast Survey the consensus (average estimate) among various economists is for 3.1% GDP growth in 2018 and 2.4% GDP growth in 2019.  However,  there are other broad-based economic indicators that seem to imply a weaker growth rate.

As well, it should be remembered that GDP figures can be (substantially) revised.

Charts Indicating U.S. Economic Weakness

Below are a small sampling of charts that depict weak growth or contraction, and a brief comment for each:

Total Federal Receipts

“Total Federal Receipts” growth continues to be intermittent in nature since 2015.  As well, the level of growth does not seem congruent to the (recent) levels of economic growth as seen in aggregate measures such as Real GDP.

“Total Federal Receipts” through October had a last value of $252,692 Million.  Shown below is  the measure displayed on a “Percent Change From Year Ago” basis with value 7.4%, last updated November 13, 2018:

Monthly Treasury Receipts

source:  U.S. Department of the Treasury. Fiscal Service, Total Federal Receipts [MTSR133FMS], retrieved from FRED, Federal Reserve Bank of St. Louis, accessed November 13, 2018:

https://fred.stlouisfed.org/series/MTSR133FMS

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Real Hourly Earnings

The level and growth rates of wages and household earnings continues to be (highly) problematical.  I have extensively discussed these worrisome trends in income and earnings.

As seen in many measures the problem is chronic (i.e long-term) in nature.

Shown below is a chart depicting the 12-month percent change in real average weekly earnings for all employees from January 2008 – September 2018.  As seen in the chart below, growth in this measure over the time period depicted has been intermittent, volatile, and, especially since 2017, weak:

U.S. Real Average Weekly Earnings

source:  Bureau of Labor Statistics, U.S. Department of Labor, The Economics Daily, Real average weekly earnings increase 1.1 percent, September 2017 to September 2018 on the Internet at https://www.bls.gov/opub/ted/2018/real-average-weekly-earnings-increase-1-point-1-percent-september-2017-to-september-2018.htm(visited November 09, 2018).

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Unemployment

I have written extensively concerning unemployment, as the current and future unemployment issue is of tremendous importance.

The consensus belief is that employment is robust, citing total nonfarm payroll growth and the current unemployment rate of 3.7%.  However, my analyses continue to indicate that the conclusion that employment is strong is incorrect.  While the unemployment rate indicates that unemployment is (very) low, closer examination indicates that this metric is, for a number of reasons, highly misleading.

My analyses indicate that the underlying dynamics of the unemployment situation remain exceedingly worrisome, especially with regard to the future.  These dynamics are numerous and complex, and greatly lack recognition and understanding, especially as how from an “all-things-considered” standpoint they will evolve in an economic and societal manner.  I have recently written of the current and future U.S. employment situation on the “U.S. Employment Trends” page.

While there are many charts that can be shown, one that depicts a worrisome trend is the  Civilian Labor Force Participation Rate for those with a Bachelor’s Degree and Higher, 25 years and over.  Among disconcerting aspects of this measure is the long-term (most notably the post-2009) trend, especially given this demographic segment.

The current value as of the November 2, 2018 update (reflecting data through the October employment report) is 73.4%:

Civilian Labor Force Participation Rate: Bachelor's Degree and Higher, 25 years and over

source:  U.S. Bureau of Labor Statistics, Civilian Labor Force Participation Rate: Bachelor’s Degree and Higher, 25 years and over [LNS11327662], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed November 12, 2018:

https://fred.stlouisfed.org/series/LNS11327662

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New Home Sales

For numerous economic reasons, the number and price of homes sales, especially new home sales, is a very important aspect of the U.S. economy.

As an indication for the overall health of the overall new home sales market, below is the Dow Jones Home Construction Index, depicted on a weekly basis, LOG scale, from the year 2000 through the closing price of 635.79 on November 13, 2018.  As one can see, the latest peak was on January 24, 2018 at 1008.89:

(click on chart to enlarge image)(chart courtesy of StockCharts.com; chart creation and annotation by the author)

DJUSHB Weekly chart since 2000

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Other Indicators

As mentioned previously, many other indicators discussed on this site indicate economic weakness or economic contraction, if not outright (gravely) problematical economic conditions.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2722.18 as this post is written

Charts Indicating Economic Weakness – October 2018

U.S. Economic Indicators

Throughout this site there are many discussions of economic indicators.  At this time, the readings of various indicators are especially notable.  This post is the latest in a series of posts indicating U.S. economic weakness or a notably low growth rate.

While many U.S. economic indicators – including GDP – are indicating economic growth, others depict (or imply) various degrees of weak growth or economic contraction.  As seen in the October 2018 Wall Street Journal Economic Forecast Survey the consensus (average estimate) among various economists is for 3.1% GDP growth in 2018 and 2.4% GDP growth in 2019.  However,  as discussed below, there are other broad-based economic indicators that seem to imply a weaker growth rate.

As well, it should be remembered that GDP figures can be (substantially) revised.

One GDP-based measure that is notable is that of the GDPplus measure from the Federal Reserve Bank of Philadelphia.

Shown below is the most recent update (from September 27, reflecting the GDP release for the 2nd Quarter of 2018, 3rd Estimate).  Of note is the divergence between the Real GDP (4.1%*, shown in orange) and the GDPplus measure (2.0%*, shown in light blue):

GDPplus

* the quarter-over-quarter growth rate in continuously compounded annualized percentage points

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Other Charts Indicating U.S. Economic Weakness

Below are a small sampling of charts that depict weak growth or contraction, and a brief comment for each:

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

While the 2nd quarter GDP (3rd Estimate)(pdf) was 4.2%, there are other broad-based economic indicators that seem to imply a weaker growth rate.

Among the broad-based economic indicators that imply weaker growth is that of the Aruoba-Diebold-Scotti Business Conditions Index (ADS Index.)  Below is a two-year chart of the index through October 6, 2018, with a value of -.0323, as of the October 11 update:

ADS Index 2 years as of 10-11-18 update

source:  Federal Reserve Bank of Philadelphia, Aruoba-Diebold-Scotti Business Conditions Index (ADS Index)

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Auto Sales

As discussed in previous posts, I believe that many factors indicate that auto sales have peaked.  While this peaking will have extensive economic implications, there are many other factors concerning auto sales that are worrisome.  While an exhaustive discussion of the topic would be exceedingly lengthy, various notable factors include the degree to which (ultra-) cheap financing and relaxed financing terms are aiding sales, as well as various aspects of pricing and discounting.

Shown below is a 3-year chart showing the performance of various auto stocks.  As one can see, there has been consistent weakness in these stocks (generally) since the beginning of 2018:

(click on chart to enlarge image)(chart courtesy of StockCharts.com; chart creation and annotation by the author)

auto stocks price charts 3 years

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Vehicle Miles Traveled

I continue to find the flagging growth trend in the “Vehicle Miles Traveled” (NSA) measure since 2015 to be notable.

“Vehicle Miles Traveled” through August had a last value of 286,654 Million.  Shown below is  the measure displayed on a “Percent Change From Year Ago” basis with value 1.2%, last updated October 12, 2018:

TRFVOLUSM227NFWA_10-12-18 286654 1.2 Percent Change From Year Ago

source:   U.S. Federal Highway Administration, Vehicle Miles Traveled [TRFVOLUSM227NFWA], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed October 12, 2018:

https://fred.stlouisfed.org/series/TRFVOLUSM227NFWA

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Underperformance Of Consumer Staples Stocks

In the March 23, 2017 post (“‘Hidden’ Weakness In Consumer Spending?“) I wrote of various indications that consumer spending may be (substantially) less than what is depicted by various mainstream indicators, including overall retail sales.

One recent development that appears to be an indication of problems in consumer spending is the performance of the consumer staples stocks.  As one can see in the chart below, there has been a marked relative weakness in these stocks (with the XLP serving as a proxy).  The chart shows a 10-year daily depiction of the XLP (top plot), the S&P500 (middle plot) and XLP:S&P500 ratio (bottom plot.)  While there can be various interpretations and reasons for this underperformance, it does appear to represent a “red flag” especially considering other problematical indications concerning consumer spending:

(click on chart to enlarge image)(chart courtesy of StockCharts.com; chart creation and annotation by the author)

XLP v SPX 10 years

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Other Indicators

As mentioned previously, many other indicators discussed on this site indicate economic weakness or economic contraction, if not outright (gravely) problematical economic conditions.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2767.13 as this post is written

Charts Indicating Economic Weakness – September 2018

U.S. Economic Indicators

Throughout this site there are many discussions of economic indicators.  At this time, the readings of various indicators are especially notable.  This post is the latest in a series of posts indicating U.S. economic weakness or a notably low growth rate.

While many U.S. economic indicators – including GDP – are indicating economic growth, others depict (or imply) various degrees of weak growth or economic contraction.  As seen in the September 2018 Wall Street Journal Economic Forecast Survey the consensus (average estimate) among various economists is for 3.1% GDP growth in 2018 and 2.4% GDP growth in 2019.  However,  there are other broad-based economic indicators that seem to imply a weaker growth rate.

As well, it should be remembered that GDP figures can be (substantially) revised.

Among the broad-based economic indicators that have been implying weaker growth or mild contraction is the Chicago Fed National Activity Index (CFNAI).

The August 2018 Chicago Fed National Activity Index (CFNAI) updated as of August 27, 2018:

The CFNAI, with current reading of .13:

CFNAI_8-27-18 .13

source:  Federal Reserve Bank of Chicago, Chicago Fed National Activity Index [CFNAI], retrieved from FRED, Federal Reserve Bank of St. Louis, August 27, 2018;

https://fred.stlouisfed.org/series/CFNAI

The CFNAI-MA3, with current reading of .05:

CFNAIMA3_8-27-18 .05

source:  Federal Reserve Bank of Chicago, Chicago Fed National Activity Index: Three Month Moving Average [CFNAIMA3], retrieved from FRED, Federal Reserve Bank of St. Louis, August 27, 2018;

https://fred.stlouisfed.org/series/CFNAIMA3

Another broad-based economic indicator that implies a weaker growth is that of the Aruoba-Diebold-Scotti Business Conditions Index (ADS Index.)  Below is a two-year chart of the index through September 8, 2018, with a value of .1034, as of the September 13 update:

ADS Index 9-8-18 .1034

source:  Federal Reserve Bank of Philadelphia, Aruoba-Diebold-Scotti Business Conditions Index (ADS Index)

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Other Charts Indicating U.S. Economic Weakness

Below are a small sampling of other charts that depict weak growth or contraction, and a brief comment for each:

Total Federal Receipts

“Total Federal Receipts” growth continues to be intermittent in nature since 2015.  As well, the level of growth does not seem congruent to the (recent) levels of economic growth as seen in aggregate measures such as Real GDP.

“Total Federal Receipts” through August had a last value of $219,115 Million.  Shown below is  the measure displayed on a “Percent Change From Year Ago” basis with value -3.2%, last updated September 13, 2018:

MTSR133FMS_9-13-18 219115 -3.2 Percent Change From Year Ago

source:  U.S. Department of the Treasury. Fiscal Service, Total Federal Receipts [MTSR133FMS], retrieved from FRED, Federal Reserve Bank of St. Louis, accessed August 11, 2018:

https://fred.stlouisfed.org/series/MTSR133FMS

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Federal Government Current Tax Receipts:  Personal Current Taxes

Another measure that depicts weakness is that of “Federal government current tax receipts: Personal Current Taxes.”  Through the second quarter the value is $1605.803 Billion Seasonally Adjusted Annual Rate (SAAR).  Shown below is the chart, displayed on a “Percent Change From Year Ago” basis with value of 0%, last updated August 29, 2018:

A074RC1Q027SBEA_8-29-18 1605.803 0 Percent Change From Year Ago

source:  U.S. Bureau of Economic Analysis, Federal government current tax receipts: Personal current taxes [A074RC1Q027SBEA], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed September 10, 2018:

https://fred.stlouisfed.org/series/A074RC1Q027SBEA

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The Yield Curve

Many people believe that the Yield Curve is a leading economic indicator for the United States economy.

On March 1, 2010, I wrote a post on the issue, titled “The Yield Curve As A Leading Economic Indicator.”

While I continue to have the stated reservations regarding the “yield curve” as an indicator, I do believe that it should be monitored.

As an indication of the yield curve (i.e. a yield curve proxy), below is a weekly chart from January 1, 1990 through September 13, 2018.  The top two plots show the 10-Year Treasury and 2-Year Treasury yields.  The third plot shows the (yield) spread between the 10-Year Treasury and 2-Year Treasury, with the September 13, 2018 closing value of .21%.  The bottom plot shows the S&P500:

(click on chart to enlarge image)(chart courtesy of StockCharts.com; chart creation and annotation by the author)

Yield Curve Proxy as of 9-13-18

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Auto Sales

Auto sales have experienced significant growth over the post-2009 period. The current reading (through August, updated on September 7) is 16.596 million vehicles SAAR:

Light Weight Vehicle Sales: Autos and Light Trucks

source:  U.S. Bureau of Economic Analysis, Light Weight Vehicle Sales: Autos and Light Trucks [ALTSALES], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed September 10, 2018:

https://fred.stlouisfed.org/series/ALTSALES

Here is the same measure on a “Percent Change From Year Ago” basis, with value .9%:

Light Weight Vehicle Sales: Autos and Light Trucks Percent Change From Year Ago

I believe that many factors indicate that auto sales have peaked.  While this peaking will have vast economic implications, there are many other factors concerning auto sales that are worrisome.  While an exhaustive discussion of the topic would be exceedingly lengthy, various notable factors include the degree to which (ultra-) cheap financing and relaxed financing terms are aiding sales, as well as various aspects of pricing and discounting.

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Other Indicators

As mentioned previously, many other indicators discussed on this site indicate economic weakness or economic contraction, if not outright (gravely) problematical economic conditions.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2904.18 as this post is written

Charts Indicating Economic Weakness – August 2018

U.S. Economic Indicators

Throughout this site there are many discussions of economic indicators.  At this time, the readings of various indicators are especially notable.  This post is the latest in a series of posts indicating U.S. economic weakness or a notably low growth rate.

While many U.S. economic indicators – including GDP – are indicating economic growth, others depict (or imply) various degrees of weak growth or economic contraction.  As seen in the August 2018 Wall Street Journal Economic Forecast Survey the consensus (average estimate) among various economists is for 3.0% GDP growth in 2018 and 2.4% GDP growth in 2019.  However,  there are other broad-based economic indicators that seem to imply a weaker growth rate.

As well, it should be remembered that GDP figures can be (substantially) revised.

Charts Indicating U.S. Economic Weakness

Below are a small sampling of charts that depict weak growth or contraction, and a brief comment for each:

Total Federal Receipts

“Total Federal Receipts” growth continues to be intermittent in nature since 2015.  As well, the level of growth does not seem congruent to the (recent) levels of economic growth as seen in aggregate measures such as Real GDP.

“Total Federal Receipts” through July had a last value of $225,266 Million.  Shown below is  the measure displayed on a “Percent Change From Year Ago” basis with value -2.9%, last updated August 10, 2018:

MTSR133FMS_8-10-18 225266 -2.9 Percent Change From Year Ago

source:  U.S. Department of the Treasury. Fiscal Service, Total Federal Receipts [MTSR133FMS], retrieved from FRED, Federal Reserve Bank of St. Louis, accessed August 11, 2018:

https://fred.stlouisfed.org/series/MTSR133FMS

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Taxes On Corporate Income

Another measure that depicts weakness is that of “Federal government current tax receipts: Taxes on corporate income.”  Through the first quarter the value is $149.029 Billion.  Shown below is the chart, last updated July 27, 2018:

B075RC1Q027SBEA_7-27-18 149.029

source:  U.S. Bureau of Economic Analysis, Federal government current tax receipts: Taxes on corporate income [B075RC1Q027SBEA], retrieved from FRED, Federal Reserve Bank of St. Louis;  accessed August 9, 2018:

https://fred.stlouisfed.org/series/B075RC1Q027SBEA

Here is a chart of the measure, on a “Percent Change From Year Ago” basis with value of -48.6%, through the first quarter, last updated July 27, 2018:

B075RC1Q027SBEA Percent Change From Year Ago

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

While the 2nd quarter GDP (Advance Estimate)(pdf) was 4.1%, there are other broad-based economic indicators that seem to imply a weaker growth rate.

Among the broad-based economic indicators that imply weaker growth is that of the Aruoba-Diebold-Scotti Business Conditions Index (ADS Index.)  Below is a two-year chart of the index through August 4, 2018, with a value of .047, as of the August 8 update:

ADS Index

source:  Federal Reserve Bank of Philadelphia, Aruoba-Diebold-Scotti Business Conditions Index (ADS Index)

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Total Construction Spending:  Commercial

“Total Construction Spending: Commercial” is a measure of construction exhibiting weak YoY growth.   This measure through June had a last value of $90,991 Million.  Shown below is the measure displayed on a “Percent Change From Year Ago” basis with a value of 1.1%, last updated August 1, 2018:

TLCOMCONS_8-1-18 90991 1.1 Percent Change From Year Ago

source:  U.S. Bureau of the Census, Total Construction Spending: Commercial [TLCOMCONS], retrieved from FRED, Federal Reserve Bank of St. Louis, accessed August 9, 2018:

https://fred.stlouisfed.org/series/TLCOMCONS

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Real Hourly Earnings

The level and growth rates of wages and household earnings continues to be (highly) problematical.  I have extensively discussed these worrisome trends in income and earnings.

As seen in many measures the problem is chronic (i.e long-term) in nature.

Shown below is a chart depicting the 12-month percent change in real average hourly and weekly earnings for private sector employees from June 2008 – June 2018.  (July 2018 was unchanged from June 2018, and it decreased .2% YoY (i.e. compared to July 2017.))  As seen in the chart below, growth in this measure over the time period depicted has been intermittent, volatile, and, especially since 2017, weak:

Real Average Hourly Earnings

source:  Bureau of Labor Statistics, U.S. Department of Labor, The Economics Daily, Real average hourly earnings unchanged from June 2017 to June 2018 on the Internet at https://www.bls.gov/opub/ted/2018/real-average-hourly-earnings-unchanged-from-june-2017-to-june-2018.htm(visited August 10, 2018).

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Other Indicators

As mentioned previously, many other indicators discussed on this site indicate economic weakness or economic contraction, if not outright (gravely) problematical economic conditions.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2833.28 as this post is written

Charts Indicating Economic Weakness – July 2018

U.S. Economic Indicators

Throughout this site there are many discussions of economic indicators.  At this time, the readings of various indicators are especially notable.  This post is the latest in a series of posts indicating U.S. economic weakness or a notably low growth rate.

While many U.S. economic indicators – including GDP – are indicating economic growth, others depict (or imply) various degrees of weak growth or economic contraction.  As seen in the July 2018 Wall Street Journal Economic Forecast Survey the consensus (average estimate) among various economists is for 2.9% GDP growth in 2018.  However,  there are other broad-based economic indicators that seem to imply a weaker growth rate.

As well, it should be remembered that GDP figures can be (substantially) revised.

Charts Indicating U.S. Economic Weakness

Below are a small sampling of charts that depict weak growth or contraction, and a brief comment for each:

Total Federal Receipts

“Total Federal Receipts” growth continues to be intermittent in nature since 2015.  As well, the level of growth does not seem congruent to the (recent) levels of economic growth as seen in aggregate measures such as Real GDP.

“Total Federal Receipts” through June had a last value of $316,278 Million.  Shown below is  the measure displayed on a “Percent Change From Year Ago” basis with value -6.6%, last updated July 12, 2018:

MTSR133FMS

source:  U.S. Department of the Treasury. Fiscal Service, Total Federal Receipts [MTSR133FMS], retrieved from FRED, Federal Reserve Bank of St. Louis, accessed July 12, 2018:

https://fred.stlouisfed.org/series/MTSR133FMS

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The Yield Curve

Many people believe that the Yield Curve is a leading economic indicator for the United States economy.

On March 1, 2010, I wrote a post on the issue, titled “The Yield Curve As A Leading Economic Indicator.”

While I continue to have the stated reservations regarding the “yield curve” as an indicator, I do believe that it should be monitored.

As an indication of the yield curve (i.e. a yield curve proxy), below is a weekly chart from January 1, 1990 through July 11, 2018.  The top two plots show the 10-Year Treasury and 2-Year Treasury yields.  The third plot shows the (yield) spread between the 10-Year Treasury and 2-Year Treasury, with the July 11, 2018 closing value of .27%.  The bottom plot shows the S&P500:

(click on chart to enlarge image)(chart courtesy of StockCharts.com; chart creation and annotation by the author)

Yield Curve proxy

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U.S. Auto Sales

U.S. auto sales have experienced significant growth over the post-2009 period as seen in the chart shown below. The current reading (through June) is 17.381 million vehicles SAAR.  Of great economic importance is whether auto sales have peaked, which I believe has occurred, as well as other problematical characteristics of the light vehicle market.  A long-term chart is shown below:

Light Weight Vehicle Sales: Autos and Light Trucks

source:  U.S. Bureau of Economic Analysis, Light Weight Vehicle Sales: Autos and Light Trucks [ALTSALES], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed July 10, 2018:

https://fred.stlouisfed.org/series/ALTSALES

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Vehicle Miles Traveled

I find the flagging growth trend in the “Vehicle Miles Traveled” (NSA) measure since 2015 to be notable.

“Vehicle Miles Traveled” through April had a last value of 272,442 Million.  Shown below is  the measure displayed on a “Percent Change From Year Ago” basis with value -.2%, last updated July 2, 2018:

TRFVOLUSM227NFWA_7-2-18 -.2 Percent Change From Year Ago

source:   U.S. Federal Highway Administration, Vehicle Miles Traveled [TRFVOLUSM227NFWA], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed July 12, 2018:

https://fred.stlouisfed.org/series/TRFVOLUSM227NFWA

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Alternate Growth Trend Measures

Another facet of economic activity is seen in the ratio of the Conference Board’s Coincident Composite Index to the Lagging Composite Index.  I interpret the trends seen in this measure to be disconcerting, as the ratio has generally been sinking for years:

Conference Board Coincident To Lagging Ratio

source:  Haver’s June 21, 2018 post (“U.S. Leading Economic Indicators’ Rate of Increase Eases“)

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Other Indicators

As mentioned previously, many other indicators discussed on this site indicate economic weakness or economic contraction, if not outright (gravely) problematical economic conditions.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2798.29 as this post is written