Leading Economic Indicators

Developed fifty years ago by the National Bureau of Economic Research, the analytic methods of business cycles and economic indicators enable economists to forecast economic trends by examining the repetitive sequences that occur in business cycles. The methodology has proven to be an inexpensive and useful tool that is now used extensively throughout the world. In recent years, however, significant new developments have emerged in the field of business cycles and economic indicators. This volume contains twenty-two articles by international experts who are working with new and innovative approaches to indicator research. They cover advances in three broad areas of research: the use of new developments in economic theory and time-series analysis to rationalise existing systems of indicators; more appropriate methods to evaluate the forecasting records of leading indicators, particularly of turning point probability; and the development of new indicators.

A history and critical assessment of leading indicators reveals their indelible impact on the economy, public policy and other critical decisions, discussing their shortcomings while making suggestions for reducing dependence on them.

This text provides a thorough explanation of the non-financial economic indicators that are closely watched by the financial markets. It details how the indicators are compiled and what the statistical significance is for the economy, as well as presenting insights into interpreting the data.

Every day, stocks, bonds, and currencies bounce wildly in response to new economic indicators. Money managers obsess over those statistics, because they provide crucial clues about the future of the economy and the financial markets. Nowyoucan use these indicators to make smarter investment decisions, just like the professionals do.You don't need an economics degree, or a CPA... just this easy-to-use book. FormerTIMEMagazine senior economics reporter Bernard Baumohl has done the impossible: he's made economic indicatorsfascinating. Using real-world examples and stories,Baumohl illuminates every U.S. and foreign indicator that matters.Where to find them.What they look like. What the insiders know about their track records. Andexactlyhow to interpret them. Whether you're an investor,broker, portfolio manager, researcher, journalist,or student, you'll find this book indispensable.Nobody can predict the future with certainty. ButThe Secrets of Economic Indicatorswill get you as close as humanly possible. What the numbersreallymean... ...to stocks, bonds, rates, currencies, and you Ahead of the curve: spotting turning points Calling recessions and recoveries in time to profit from them Leading indicators: where's the economyreallyheading Decoding initial unemployment claims, housing starts, the yield curve, and other predictors Beyond the borders Why foreign indicators are increasingly important—and how to use them Making sense of indicators in conflict What to do when the numbers disagree Finding the data Free web resources for the latest economic data Investments "This is the most up-to-date guide to economic indicators and their importance to financial markets in print. For anyone trying to follow the economic data, this should be next to yourcomputer so that you can understand and find the data on the Internet." David Wyss, Chief Economist, Standard and Poor's "I find Baumohl's writing fascinating. Just about anyone who's serious about understanding which way the economy is headed will want to read this book. It could be a classic." Harry Domash, Columnist for MSN Money and Publisher, Winning Investing Newsletter "Every business person or investor should keep a copy of Baumohl's book close-at-hand. It is great, at long last, to have someone who has eliminated what may have been so perplexing to so many and to have done so with such remarkable clarity." Hugh Johnson, Chief Investment Officer, First Albany "Bernie Baumohl has written a "must read" educational and reference book that every individual investor will find indispensable for watching, monitoring, and interpreting the markets." Allen Sinai, President and Chief Global Economist, Decision Economics, Inc. "Baumohl has a gift for taking a complicated subject and allowing it to read like a fast-moving novel. I recommend this book if you care about your future finances." Morris E. Lasky, CEO, Lodging Unlimited, Inc.—manager and consultant for $6 billion in hotel assets; Chairman, Lodging Conference; Chairman, International Hotel Conference "I think this is an excellent book. It's well written, accessible to a variety of readers, deals with an interesting and important subject, and covers the topic well. It deserves to get a lot of notice and use." D. Quinn Mills, Alfred J. Weatherhead Jr., Professor of Business Administration, Harvard Business School The fascinating, plain-English guide to economic indicators: what they mean, and how to use them. Unemployment. Inflation. Consumer confidence. Retail sales... Every morning brings new economic statistics. Which economic indicators really matter? What do they mean for stocks, bonds, interest rates, currencies...your portfolio? How can you use them to make faster, smarter investment decisions? Simple, clear, non-technical, friendly,usable...theonlybook of its kind! By former renownedTIMEMagazine economics journalist Bernard Baumohl. © Copyright Pearson Education. All rights reserved.

How did we come by the “leading indicators” we place such stock in? We allocate trillions of dollars and make public policy and personal decisions based upon them, but what do they really tell us? “The leading indicators” shape our lives intimately, but few of us know where these numbers come from, what they mean, or why they rule the world. GDP, inflation, unemployment, trade, and a host of averages determine whether we feel optimistic or pessimistic about the country’s future and our own. They dictate whether businesses hire and invest, or fire and hunker down, whether governments spend trillions or try to reduce debt, whether individuals marry, buy a car, get a mortgage, or look for a job. Zachary Karabell tackles the history and the limitations of each of our leading indicators. The solution is not to invent new indicators, but to become less dependent on a few simple figures and tap into the data revolution. We have unparalleled power to find the information we need, but only if we let go of the outdated indicators that lead and mislead us.

We are bombarded with economic numbers: unemployment, retail sales, inflation, GDP—the list goes on and on. Some analyst or another is constantly telling us about an obscure statistic that is the key to our future, or is apparently the indicator that the "Fed" will be using to key off its decisions. With economic numbers playing such a central role in the national and world dialogue on policy and markets, and spilling over into the political arena, a broad review of what they are all about is timely. This book reviews the critical US economic data, and how one may put the numbers into an intellectual structure that will depict evolving economic reality. The work is aimed at those who want and need to get some understanding about how the data contributes to a big picture of the economy and guides policy. The objective is for the reader to grasp the overall logic of the data—how each piece of the puzzle contributes to our understanding of the overall economy. This is the way the Fed looks at the numbers. There are other books that go through the economic numbers, but they do so in a "bottom-up" fashion, describing a series in some detail and adding something about how financial markets may respond to it. This book naturally has considerable discussion of series, but views them as part of the overall mosaic, not items of fundamental interest in themselves.

The ultimate resource for understanding and interpreting important economic figures Economic indicators are increasingly complicated to compute and comprehend. Yet in today's challenging economic environment, economic indicators are also more important than ever. This highly accessible seventh edition of the Guide to Economic Indicators presents the complicated subject of economic indicators in a conversational tone, helping readers to quickly gain an understanding of economic indicators, including why they're important, how to interpret them, and their reliability in predicting future economic performance. The book Describes how economic indicators can be manipulated to demonstrate almost any business cycle Examines how GDP, invisible balances, the terms of trade, and unemployment are used to interpret economic data Includes over ninety tables and charts Fully updated and revised, the Guide to Economic Indicators, 7th Edition is an invaluable resource for anyone searching for a clear explanation of the world's underlying economic realities.

Leading, composite and sentiment indicators offer a powerful way of communication of statistical information and reaching out to users of statistics. The indicators can provide relevant and timely information on aspects of the economy and the social society that are not covered by other statistics. They can also provide information on complex phenomena in simple and condensed form, for instance on the current or expected economic development or on the well-being or sense of happiness of the citizens. These Guidelines provide guidance to statistical offices on their possible roles in developing and producing leading, composite and sentiment indicators and give practical and operational guidance to statistical offices that produce or consider producing these indicators. Existing examples of good practice are also referenced.