ICSC-GS Weekly Store Sales Continue to Improve After Expectations Downside of Range is Lifted; Redbook Improves.
S&P/Case-Shiller Home Price Index Disappoints Yet Again But Seasonally Adjusted +0.4%.
Conference Board’s Consumer Confidence Bounces.
Tax receipts covering less than 50% of public spending in peacetime was the German Weimar government, so Japan joins rare company.
www.atimes.com/atimes/Global_Economy/LC31Dj02.html
Tax receipts might be a good comparison for GDP doubters but we don’t have the data. The Conference Board Coincident Index is what the NBER used to use and may still to pinpoint turning points and it currently shows the economy bottomed in June 2009. The NBER seems to have a harder time pinpointing turning points since Moore and then Zarnowitz died, so we’re not sure if their missed intial calls is due to political pressure or a change in technique. Moore and Zarnowitz designed and used the coincident indexes. Moore especially was more interested in applied economics and practical use. Moore’s background was farming and ag econ, so he was always working on applying economics for investors and business and made bold calls. So many economists are worried about hurting their reputation and don’t want to forecast or have models that give specific calls. We got our inflation cycle comparisons from Moore and they can be very handy despite neither FIBER or ECRI using them anymore. All the economic cycle comparisons that we do came from Moore and Zarnowitz even though they would laugh at our use of growth rates on almost anything. Moore did as much, however, when it came to his market indicators.
The main thing we’ve added is using how the indexes relate to each other. If you can get the data of the old JoC commodity index, it can be very handy. A Chicago trader used to have it faxed intraday to the floor. The index uses the prices of burlap, benzene, rubber, cardboard, and many other commodities that aren’t normally looked at. The textile subindex tended to lag and metals/misc tended to lead. Moore and Zarnowitz would sometimes use beer consumption or motorcycle sales in emerging countries to make their indexes. The only country they worked on (and with) that didn’t end in much success was Mexico despite the help of both the govt and Dallas Fed.
North America is bush-league compared to Australia in debt slavery race? Mike Shedlock checked the figures and says North America is tops, despite the Australian claim. This is getting a bit like after the Cross Bronx Expressway lost the title of “America’s Worst Road”. The northeast was in an uproar saying, “traffic, potholes, and the time it would take thieves to be on your car if it broke down clearly makes us #1.”
Markets (oil price and interest rate growth rates relative to the stock market):
Long term: Neutral 2/8.
Intermediate: Positive 3/19.
Short-term: Neutral 3/24.
Sectors (basic materials and energy growth rates relative to the other sectors):
Long term: Neutral 9/10.
Intermediate: Neutral 11/11.
Short-term: Neutral 1/12.
