LIVE Gold Prices $  | E-Mail Subscriptions | Update GoldSeek | GoldSeek Radio 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page 

 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

GoldSeek.com to Launch New Website
By: GoldSeek.com

Is Gold Price Action Warning Of Imminent Monetary Collapse Part 2?
By: Hubert Moolman

Gold and Silver Are Just Getting Started
By: Frank Holmes, US Funds

Silver Makes High Wave Candle at Target – Here’s What to Expect…
By: Clive Maund

Gold Blows Through Upside Resistance - The Chase Is On
By: Avi Gilburt

U.S. Mint To Reduce Gold & Silver Eagle Production Over The Next 12-18 Months
By: Steve St. Angelo, SRSrocco Report

Gold's sharp rise throws Financial Times into an erroneous sulk
By: Chris Powell, GATA

Precious Metals Update Video: Gold's unusual strength
By: Ira Epstein

Asian Metals Market Update: July-29-2020
By: Chintan Karnani, Insignia Consultants

Gold's rise is a 'mystery' because journalism always fails to pursue it
By: Chris Powell, GATA

 
Search

GoldSeek Web

 
US Recession Watch


By: Steve Saville, The Speculative Investor

 -- Published: Monday, 7 May 2018 | Print  | Disqus 

The US economic expansion that began in mid-2009 has been much weaker than average, but, as indicated by the chart displayed below, it is also much longer than average. In fact, it is simultaneously the weakest and the second-longest expansion on record. Due to the advanced age of the expansion and the signs of weakness that have appeared over the past three months in economic statistics and the stock market, recession warnings are becoming more common. However, when we take an impartial look at the most reliable leading indicators of recession we arrive at the conclusion that these warnings are premature.


Chart source: http://realinvestmentadvice.com/bull-markets-actually-do-die-of-old-age/

The three leading indicators of US recession that we care about are the ISM New Orders Index (NOI), Real Gross Private Domestic Investment (RGPDI) and the yield curve. Not one of these indicators is close to giving a recession warning, which is why we say that the increasingly-common warnings of recession are premature.

The NOI, for instance, has declined each month since making a 13-year high in December-2017, but it remains far above the level that it would have to drop below (the red line on the following chart) to warn of a recession.

Also, there are not even tentative signs of major trend reversals in either RGPDI or the yield curve. That’s because last month the US yield curve became its flattest in more than 10 years (a recession is signaled by a major shift from flattening to steepening) and because the data published at the end of last week revealed that RGPDI hit a new all-time high in Q1-2018. RGPDI’s trend generally reverses downward at least two quarters prior to the start of a recession.

Note that the vertical red lines on the following chart mark the starting points of the last two recessions.

Based on the latest data, we roughly estimate the recession start-time probabilities as follows:
- Q2-2018: 0%
- Q3-2018: 10%
- Q4-2018: 30%
- Some time in 2019: >80%

The main reason for our high 2019 recession probability estimate is the decline in the G2 (US plus euro-zone) monetary inflation rate illustrated by the following chart. The inflation rate bounced in March, but it’s likely that the preceding decline was large enough to bring the artificial boom to an end.

 


| Digg This Article
 -- Published: Monday, 7 May 2018 | E-Mail  | Print  | Source: GoldSeek.com

comments powered by Disqus


Regular financial market forecasts and analyses are provided at our web site. We aren’t offering a free trial subscription at this time, but free samples of our work (excerpts from our regular commentaries) can be viewed here.

E-mail: Steve Saville



 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2019



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer


Map

The views contained here may not represent the views of GoldSeek.com, Gold Seek LLC, its affiliates or advertisers. GoldSeek.com, Gold Seek LLC makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, Gold Seek LLC, is strictly prohibited. In no event shall GoldSeek.com, Gold Seek LLC or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.