« Can We Have a Recovery When People Have So Much Debt? | Main | How NOT to Conduct an Interview »
Check Out the Kiplinger Recovery Index
By JLP | June 12, 2009
I received an email from a PR person for Kiplinger’s yesterday introducing the Kiplinger Recovery Index:
Identifying a turn in the economy is tricky business, especially when each day’s news seems to bring conflicting information. To cut through the noise, Kiplinger.com has developed the Kiplinger Recovery Index, which identifies 6 key economic indicators (shown in the graphic below).
All 6 indicators have posted some dramatic tumbles, but all are also showing signs that they may be bottoming, several are recovering, and interest rate spreads have recently returned to health. When at least 3 of the 6 indicators go fully positive – noted by a check mark — it’s more than likely that the recession has ended.
Here’s how the Index looked yesterday when I received the email:
As you can see from the graphic, only one of the items is checked off. For an explanation of each indicator, check out Kiplinger’s Economic Recovery website.
One indicator that I don’t see but would be important (at least in my mind) would be household debt to income. As we talked about yesterday, I don’t see how we can have a recovery until household debt is under control.
Topics: Economics | 2 Comments »
June 13th, 2009 at 1:03 am
JLP,
I agree with you about the debt load. Everyone on Wall Street is examing metrics that were useful for the regular inventory led recession. This is a balance sheet recession, which is a completely different beast.
We will probably see an improvement in the economy, but it will be short lived. If things heat up and the Fed raises rate, we will see another recession. If they don't raise rates, inflation will rear its ugly head, which will cause a recession. Until we lower our debt and begin saving, we won't get through this. The market is telling us we don't get rich on debt.
June 13th, 2009 at 4:14 am
How about a listing of temporary agency/contractor employment? I think this would be a leading indicator for a recovery as a lot of employers may not want to risk hiring someone full time but will need someone to fill in for a few weeks or months.