Disclaimer

Disclaimer. After nearly 40 years managing money for some of the largest life offices and investment managers in the world, I think I have something to offer. But I can't by law give you advice, and I do make mistakes. Remember: the unexpected sometimes happens. Oddly enough, the expected does too, but all too often it takes longer than you thought it would, or on the other hand happens more quickly than you expected. The Goddess of Markets punishes (eventually) greed, folly, laziness and arrogance. No matter how many years you've served Her. Take care. Be humble. And don't blame me.

BTW, clicking on most charts will produce the original-sized, i.e., bigger version.

Saturday, September 17, 2011

US Coinciding Index for August

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I have all the data for my US coinciding index for August except one, which I've estimated.  In contrast to the weak employment data, the index is surprisingly robust.  I've plotted the 3 month rate of change in the index against a weighted average of the ISM industry and ISM services surveys.  Both series have been extreme-adjusted to remove statistical aberrations.  On the face of it, these data do not yet point towards a double dip.

The correlation between these two indicators is very close.  Of course, the 3 month rate of change would tend to lead the underlying series, which account for the absence of any leading relationship in the ISM surveys.

As always, clicking on the chart will give it you in the original size.

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