Leading Indicators

The latest leading indicator readings from the Conference Board came in for Spain and Japan, both in the negative. The table below has turned from almost all green to at least half red.

Source: Conference Board

The OECD leading indicators for June are in, and the picture is mixed. USA, Japan and Russia are both positive and upward trending. UK, Germany, Canada and Brazil are negative but trending upwards. China and India are both negative and trending downwards.

Source: OECD

ECRI leading indicators for the US have dipped into the negative and the trend is down. Note that their indicators have been very volatile since 2008 and two dips to -10 in 2010 and 2011 did not bring on either a recession or a bear market.

Source: Dshort / ECRI

Drawing all together, the picture is one of mixed to negative, globally. There is the potential that we are seeing a new turn up, looking at the likes of the UK, Brazil and Canada, that may be followed by the weak turning up also, such as India. However, there is also the potential that the weak could drag down the others, and that the current outperformers, such as USA and Japan, are starting to turn down. Based on solar cycles we are due a natural upswing. That aside, we have evidence of a new round of global government invervention, in rate cutes and various stimulus/aid measures. The question is how far they go and how quickly, to help leading indicators improve. With Spanish and Italian CDSs still pressuring record levels, the ECB is going to need to act again. The FOMC on 20th June is also going to be important.

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10 thoughts on “Leading Indicators

  1. An interesting insight into the goings-on at the European Parliament earlier today, in relation to the Euro and “Spailout”:

    It seems this video is doing the rounds through many financial institutions…

  2. Chinese OECD looks very worrisome while Shanghai Composite still remains below resistance without a breakout as many of us contrarians hoped it would. At the moment, the movement is still undecided.

    China has started easing, but the question is, as you are already put it, will they ease quick enough to re stimulate the bubble or will they let it pop properly later this year and into 2013 in a form of hard landing? Maybe we should ask the Rothchilds.

    1. Maybe you would, in fact, benefit from trying to answer your own rhetorical question in a practical and constructive way.

      Attempted jibes at those who have been taking your money will not help you to turn a significant profit Tiho – the silver I bought from you very recently is up more than 1.5%. I’ll hold on to it and see if the market gives me any more.

      I’m consious that this discussion will be tedious to other readers, if it hasn’t become so already, but it might provide an excellent illustration of the huge gulf between the skills required to analyse the markets, and those required to trade and invest. Bearing in mind your claims to be “not a fence-sitter” (I assume you mean that you are always prepared to call “buy” or “sell” in any particular set of circumstances), then have a look back at the videos of Jim Rogers you have posted in the past…

      Count the number of times he answers questions with phrases like “I don’t know…” or “I have no idea…”. Then try to reconcile why your approaches conflict so much, while you claim to adopt his style of investing.

      You are providing a vivid illustration of something the markets can do to everyone from time to time – you are allowing the markets to rile and manage you (even if you don’t feel it that way), tempting you into shorter-term trades that do not suit your style for example.

      I know that you will not be able to accept what I’ve said (although that would no doubt change if I ran a public blog, or was a name that you recognised), but I have found it useful from a personal point of view to have a quick think about it.

      It is up to you alone to decide whether you want to get back to your core strategy…

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