More Signs of an Economic Turn

Get ready, this is one of those “green shoots” posts. There’s some fairly good data here that at least argues the recession is running out of steam.

First, on the jobs front, initial claims were up 3,000 to 608,000 but the more reliable four-week moving average fell by 7,000 to 615,700. Since April the four-week average is down by 40,000. Total unemployment fell by 148,000 to 6.76 million. [NYT]

Next, the Conference Board’s index of leading economic indicators was up 1.2% in May after an upward revision to 1.1% for April. When you start seeing positive revisions that’s generally a good sign. The May increase is the largest since a 1.4% increase in March 2004. [Reuters]

Finally, Philly Fed survey of economic activity rose significantly from minus 22.6 in May to minus 2.2 in June. Both new orders and the employment gauge were at their highest levels since last September and November of last year respectively. To be sure, the reading still indicates contraction but just barely. [Reuters]

I know, I know a few data points do not a recovery make. But, these are fairly significant data points and taken with what we’ve seen over the last few months, it’s becoming pretty clear that there is a turn occurring. Whether that turns into a full blown recovery is very much up in the air. There is a lot that can go wrong and if you read this blog often, you know that I just see all of this as an upward leg on a recession (maybe something worse) that has multiple years to run.

But enjoy the good news while you can.

About Tom Lindmark 401 Articles

I’m not sure that credentials mean much when it comes to writing about things but people seem to want to see them, so briefly here are mine. I have an undergraduate degree in economics from an undistinguished Midwestern university and masters in international business from an equally undistinguished Southwestern University. I spent a number of years working for large banks lending to lots of different industries. For the past few years, I’ve been engaged in real estate finance – primarily for commercial projects. Like a lot of other finance guys, I’m looking for a job at this point in time.

Given all of that, I suggest that you take what I write with the appropriate grain of salt. I try and figure out what’s behind the news but suspect that I’m often delusional. Nevertheless, I keep throwing things out there and occasionally it sticks. I do read the comments that readers leave and to the extent I can reply to them. I also reply to all emails so feel free to contact me if you want to discuss something at more length. Oh, I also have a very thick skin, so if you disagree feel free to say so.

Enjoy what I write and let me know when I’m off base – I probably won’t agree with you but don’t be shy.

Visit: But Then What

Be the first to comment

Leave a Reply

Your email address will not be published.


*