The referenced chart (at right) shows a conspicuous drop-off since the end of November. The trend reversal is essentially confirmed by my own work with the Big Four Economic Indicators. Optimists will point out that severe weather has impacted the economy over the past two months and that the upward trend will soon return. It will indeed be important to see improvement in key economic indicators in the next few months: Nonfarm Employment, Retail Sales and Industrial Production.
DYI Comments: Once again ECRI indicators are showing a slowing economy on the verge of recession. Will the Federal Reserve pull another rabbit out of the hat when the indicators were all poised for a recession that was thwarted by operation twist? There will come a time when the law of diminishing returns will come into play when no amount of money printing takes place the economy will fall into recession.
The U.S. stock and junk bond markets are in a bubble poised for poor returns going forward with a market correction baked into the cake. Add on a recession we will see major fireworks to the downside.
DYI
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