Inventory to Sales Ratio

I have been somewhat pessimistic about the pace of the recovery that appears to be underway, particularly for labor markets, mainly because I don’t want policymakers to believe their job is done before it actually is (though they apparently came to that conclusion anyway).

I hadn’t looked at this for awhile — should I interpret the return of the inventory-sales ratio to near normal levels as good news?:

Here’s a graph of inventories, which appear to have stabilized:

About Mark Thoma 243 Articles

Affiliation: University of Oregon

Mark Thoma is a member of the Economics Department at the University of Oregon. He joined the UO faculty in 1987 and served as head of the Economics Department for five years. His research examines the effects that changes in monetary policy have on inflation, output, unemployment, interest rates and other macroeconomic variables with a focus on asymmetries in the response of these variables to policy changes, and on changes in the relationship between policy and the economy over time. He has also conducted research in other areas such as the relationship between the political party in power, and macroeconomic outcomes and using macroeconomic tools to predict transportation flows. He received his doctorate from Washington State University.

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