ECRI WLI Growth Rate at Lowest in History

Friday the Economic Cycle Research Institute, or ECRI an independent forecasting group based in New York, said its Weekly Leading Index (WLI) fell to its lowest level in its six decade history. The WLI and its growth rate are designed to predict future turning points in the business cycle (recessions and recoveries).

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Friday ECRI said its WLI fell to 112.9 for the period ending October 24, 2008. Last week WLI was 114.0.

The WLI growth rate fell to -21.9%, down from -19.3% last week.

Commenting on the data, Lakshman Achuthan, managing director at ECRI said:

With WLI growth plummeting to the lowest reading registered in its six-decade history, the outlook for the economy has darkened dramatically.

Date and graph courtesy of Economic Cycle Research Institute

Stock position: None.

Comments

[whidbey:]

This is more or less expected given recent data on this series. What it means is very hard to speculate about. Growth is critical to the economy since it seems to be either growing or retrenching, little stable middle ground. The petty is that Treasury and Fed policy have not targeted consumer demand by providing for stabilization of the housing decline. Some sort of a chapter 11 for consumers where a court could set aside a mortgage (in part) on condition that when the reality was later sold the seller would repay the set-aside. Something of that nature might stop or slow the collapse. Now jobs? We need industrial export jobs, not public sector. This seems intractable in the short run. Does it mean a long run down turn? How does it turn? I can not see the answers if indeed there are any.

2008 Nov 02 07:43 AM

[messy:]

WHAT FUTURE JOBS. The way the USA economy is now operating and the number of factories being built in America, it deplicts the future of job growth here as a huge minus. WHY YOU ASK? Because the USA does not produce shoes, sheets, shirts, pants, underware, but rather airplanes, autos and guns. What a joke for a future of a country.

2008 Nov 03 05:23 AM