A Little Good News Lost in the Doom and Gloom

The sentiment is obviously terrible out there for the market and the economy, so it is important to highlight some data that didn't get that much play because most pundits are too busy predicting when the sky will fall and whom it will fall on.

The Conference Board reported that its Index of Leading Economic Indicators rose 0.4% in January. This is the second month in a row that it increased. Five of the ten components in the index were up.

And no...I am not saying everything is great in the economy, but the world is not coming to an end like the blogosphere seems to be saying. This is not Imperial Rome, and there is no Barbarian army camped outside our walls waiting to sack us.

Capitalism is cyclical. Get used to it.

Comments

[Noleen]

Yes,I know that every few years due to the cyclical nature of capitalism, the country hits a recession and regular people start losing jobs and go homeless. But Eric, our lives are too short for this kind of instability.
Life is never going to be easy. There will be haves and have nots. Other governments have tried other ways, communism, socialism, dictatorships, royalty and the newest of them capitalism. None have worked to every ones satisfaction.

2009 Feb 24 05:56 AM

[Fred Voetsch]

"The Conference Board reported that its Index of Leading Economic Indicators rose 0.4% in January. This is the second month in a row that it increased. Five of the ten components in the index were up."

A very small increase from very low levels.

ECRI also shows a very small blip but we have seen such blips in this recession already and you will see it in every recession and depression.

This is a very important indicator that should not be misued. We really need to see a stronger increase in the LEI's as staying at these levels is not conducive to a recovery.

2009 Feb 24 01:54 PM

[Eric Fox]

I don't think I was misusing it. I was trying to make the point that sentiment is so negative that anything positive is ignored. The same thing happens at peaks, too much bullish sentiment.

2009 Feb 25 10:30 AM

[VennData]

The reason the LEI was up a bit back in January was because the stock market bounced. Now it's down, so the LEI will drop in months ahead.

2009 Feb 26 07:34 AM