As market participants point to a bleak outlook for 2012, I have chronicled thoughts from money managers Kyle Bass and Jeffrey Gundlach. The forecasting firm Economic Cycle Research Institute is calling for a U.S. recession in 2012.
The firm's leading indicators index has been pointing down. The Company’s Weekly Leading Index slipped to 121.3 in the week ended Dec 16 from 122.3 the previous week. The index's annualized growth rate dipped to minus 7.7 percent from minus 7.5 percent a week earlier.
The chart below outlines ECRI's Weekly Leading Index:
click to enlarge
While many are calling for another recession the charts below highlight that our recovery was short and shallow and unlikely to help the average citizen. Since the 2008 recession, real GDP has been stagnant, while unemployment has improved only modestly. Most troubling is the overall debt situation which has yet to be resolved. The stagnation in debt growth is exacerbating the problems of anemic GDP growth and stagnating unemployment.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
