Comments on: The Peekaboo Recession — Is It or Isn’t It? http://www.fundmasteryblog.com/2008/05/19/the-peekaboo-recession-is-it-or-isnt-it/ Mutual Funds, Investing, Retirement, Economy, Personal Finance Wed, 07 Jan 2009 23:40:19 +0000 http://wordpress.org/?v=2.3.1 By: owen http://www.fundmasteryblog.com/2008/05/19/the-peekaboo-recession-is-it-or-isnt-it/#comment-918 owen Sat, 14 Jun 2008 13:05:44 +0000 http://www.fundmasteryblog.com/2008/05/19/the-peekaboo-recession-is-it-or-isnt-it/#comment-918 what about ECRI? they say mild recession, and they're track record is pretty good. what about ECRI? they say mild recession, and they’re track record is pretty good.

]]> By: Sean Maher http://www.fundmasteryblog.com/2008/05/19/the-peekaboo-recession-is-it-or-isnt-it/#comment-838 Sean Maher Wed, 21 May 2008 14:33:45 +0000 http://www.fundmasteryblog.com/2008/05/19/the-peekaboo-recession-is-it-or-isnt-it/#comment-838 I agree that this is a very different downturn to those experienced in the 80s/90s or indeed after the tech bust, which were classic inventory/business cycle led recessions; it's probably more like the oil shock/banking crisis of the early 70's and therefore likely to be a protracted affair, with the ecomony dipping in and out of quarterly recession over a couple of years at least; in the end we may need a painful Volcker style squeeze on inflation to restore the economy to equilibrium. I agree that this is a very different downturn to those experienced in the 80s/90s or indeed after the tech bust, which were classic inventory/business cycle led recessions; it’s probably more like the oil shock/banking crisis of the early 70’s and therefore likely to be a protracted affair, with the ecomony dipping in and out of quarterly recession over a couple of years at least; in the end we may need a painful Volcker style squeeze on inflation to restore the economy to equilibrium.

]]> By: Penelope http://www.fundmasteryblog.com/2008/05/19/the-peekaboo-recession-is-it-or-isnt-it/#comment-835 Penelope Wed, 21 May 2008 05:15:24 +0000 http://www.fundmasteryblog.com/2008/05/19/the-peekaboo-recession-is-it-or-isnt-it/#comment-835 I've said it before and it deserves repeating, economists are notorious for being horrible forecasters (including Marty Feldstein). Yet, there's no doubt (as you correctly pointed out, Kurt) that the often contradictory economic data we've seen recently is confusing. My hunch is that this may be only the beginning of a protracted downturn and eventually all, or many, of the numbers will point in the same direction. Give it some time. As for the LEI, here's what the Conference Board had to say: "After declining steadily since the middle of 2007, the leading index appears to have stabilized lately, increasing slightly in March and April. Meanwhile, the coincident index declined slightly since October 2007 and the weaknesses among its components have been widespread in recent months. During the first quarter, real GDP expanded at a 0.6 percent annual rate, the same growth rate that prevailed in the fourth quarter of 2007. The current behavior of the composite indexes so far still suggests that economic activity is likely to remain weak in the near term." http://www.conference-board.org/economics/bci/pressRelease_output.cfm?cid=1 Despite its name, I don't believe the LEI has historically been a very good predictor of anything either. I’ve said it before and it deserves repeating, economists are notorious for being horrible forecasters (including Marty Feldstein). Yet, there’s no doubt (as you correctly pointed out, Kurt) that the often contradictory economic data we’ve seen recently is confusing. My hunch is that this may be only the beginning of a protracted downturn and eventually all, or many, of the numbers will point in the same direction. Give it some time.

As for the LEI, here’s what the Conference Board had to say:
“After declining steadily since the middle of 2007, the leading index appears to have stabilized lately, increasing slightly in March and April. Meanwhile, the coincident index declined slightly since October 2007 and the weaknesses among its components have been widespread in recent months. During the first quarter, real GDP expanded at a 0.6 percent annual rate, the same growth rate that prevailed in the fourth quarter of 2007. The current behavior of the composite indexes so far still suggests that economic activity is likely to remain weak in the near term.”
http://www.conference-board.org/economics/bci/pressRelease_output.cfm?cid=1

Despite its name, I don’t believe the LEI has historically been a very good predictor of anything either.

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